Pennsylvania residents who are ineligible for a Chapter 7 bankruptcy due to their income or who want to save their home from foreclosure may be eligible to file for Chapter 13 bankruptcy. Chapter 13 reorganizes debt and gives individual debtors a longer time frame to pay back what they owe. This process generally takes between three and five years, and in many cases, any remaining debt can be discharged.
Chapter 13 bankruptcy is available to individuals who have less than $383,175 in unsecured debts and no more than $1,149,525 in secured debts. Individuals meeting these requirements may be eligible for this type of filing even if they are self-employed or run an unincorporated business, but corporations and partnerships are not able to file for Chapter 13.
In order for individuals to be eligible to file for bankruptcy under either Chapter 13 or Chapter 7, they must have completed credit counseling with an approved credit counseling agency within the previous 180 days. Additionally, individuals are not eligible for this type of debt relief if they have filed for bankruptcy within the last 180 days and had a petition dismissed due to their failure to comply with the requirements of the court or because they requested the dismissal.
Chapter 13 bankruptcies can give individuals the ability to regain control of their finances, get out from under large amounts of debt and keep their homes. However, this process may take several years to complete, and someone who has filed for this type of bankruptcy will want to understand just how the process works to ensure they are able to complete it. A bankruptcy attorney may be able to assist people with filing as well as explaining what to expect throughout the process.
Source: United States Courts, "Chapter 13 Eligibility", October 08, 2014