ELIGIBILITY FOR A CHAPTER 13 BANKRUPTCY

ELIGIBILITY FOR A CHAPTER 13 BANKRUPTCY

Eligibility does not change for a chapter 13 whether the individuals live in Moorestown New Jersey or Northeast Philadelphia. In order to file a Chapter 13, there are limits imposed. Pursuant to section 109 of the Bankruptcy Code, only an individual with regular income that owes, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts of less than $394,725.00 and noncontingent, liquidated, secured debts of less than $1,184,200.00, or an individual with regular income and such individual's spouse, except a stockbroker or a commodity broker, that owe, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts that aggregate less than $394,725.00 and noncontingent, liquidated, secured debts of less than $1,184,200.00 may be a debtor under chapter 13 of this title. There are several items to note from this statute. First, an individual, not a corporation is eligible as long as debt is not exceeding limits. Otherwise the individual would need to file an individual Chapter 11 bankruptcy to reorganize their debts. In addition there must be regular income. While there is some flexibility in what constitutes regular, certainly if you have no income you are not eligible for chapter 13. You should consult an experienced attorney if you intend on filing a chapter 13 as there are many complexities involved.

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