Is it Possible to Have Too Much Debt to File a Chapter 13 Bankruptcy?

Is it possible to have too much debt to file a chapter 13 bankruptcy? The simple answer is yes although there are variables and other options. Chapter 13 is only for individuals and not corporations or LLC’s. It provides an individual with an opportunity to pay a debt over time, such as mortgage arrears to prevent foreclosure or taxes to avoid levies. However, you cannot file a chapter 13 if you have over $419,275.00 in unsecured debt or more than $1,257,850.00 in secured debt. If the debt is unliquidated or contingent then it does not count towards those debt limits. So what happens if your debt exceeds those limits? You can still file a chapter 11 bankruptcy to deal with the debt. A chapter 11 is more expensive and more complicated, but it generally allows you to accomplish the same thing. There is also now a more simplified chapter 11 called a subchapter V although in order to qualify you must be engaged in business activities.