When the time comes that you find there is no other alternative but to declare bankruptcy then you should know about Chapter 13 bankruptcy. This is put in place for some people that are struggling with financial difficulties. With this regulation anyone declaring bankruptcy can use their wages to pay back creditors over a specified period of time. You can make timely payments over a period of three to five years.

With this type of bankruptcy you may have difficulty with filing in the courts for it because it depends on the amount of debt you owe and how much income is coming into your home. When it is established that your income is high enough and you have a steady income there shouldnt be a problem. With this type of bankruptcy your debt cant exceed $922,975 and your total unsecured debt cant be more than $307,675. A secured debt is backed up by some material items that is used for collateral, unsecured loans are things such as credit cards, loans and medical bills.

There is a catch to this type of bankruptcy. You will be required to complete a course in personal finance management and this must be approved by the court trustee. You can receive free counseling if you qualify but if you dont then there is a fee for these services. Once this is done the courts will tell you how much you have to pay and the payments start within thirty days. These payments go to the trustee and they will pay your creditors. Ten percent of your payment will go to the trustees as their commission. When you go with this type of bankruptcy then there are debts that must be paid in full such as child support, alimony and some tax obligations.