If you do not qualify for a Chapter 7 liquidation bankruptcy, you can still qualify for a Chapter 13 reorganization. In order to qualify for a Chapter 13 an individual with regular income must have less than $336,900.00 of noncontingent, liquidated, and unsecured debt and less than $1,101,650.00 of noncontingent, liquidated, and secured debt. These numbers are adjusted every three years to reflect changes in the Consumer Price Index with the next scheduled adjustment being April 1, 2010. You also must not have received a discharge under Chapter 7, 11, or 12 during the preceding four years or filed a Chapter 13 during the preceding two years.

The most common reasons for seeking a Chapter 13 bankruptcy are to avoid foreclosures and repossession. A Chapter 13 reorganization plan gives you the opportunity to catch up on outstanding payments and even reclaim property which has been repossessed. Another benefit to a Chapter 13 bankruptcy is that is allows a debtor with substantial priority debt such as tax and child support debt to make those payments while reducing payments on other unsecured debts. Remaining current on priority debts can be especially important if the state imposes sanctions on debtors owing child support or taxes.

- Richard V. Stokan, Jr.