Chapter 13 bankruptcy differs from chapter 7 in that the “liquidation” of debts is not the goal but instead, the adjustment or modification of debts to meet the filer’s needs is taken in to consideration. The easiest way to conceive of a chapter 13 filing is that of a repayment plan. Your repayment plan can be for three to five years depending on the circumstances of your case.

Payments to your creditors are made via a trustee, that is, an agent appointed by the court. You will make your installment payments directly to the trustee for the duration of your repayment plan. While chapter 13 bankruptcy does not completely liquidate your debts, it does provide you with an alternative to ongoing financial hardships and relentless collection calls from creditors. Moreover, chapter 13 bankruptcy provides for foreclosure relief as well.

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