Should I file Chapter 13 if I haven’t made any late payments to creditors?

UPDATED: Jul 27, 2011

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Should I file Chapter 13 if I haven’t made any late payments to creditors?

I make 100K/year and am 50K in credit card debt. I am able to pay the minimum on my credit cards each month, but end up using that credit to get by. Most people who file bankruptcy are behind on payments. Is the same relief provided to people who are current on their bills? Just don’t want to go through Chapter 13 if, for example, debt is reduced by only $10K.

Asked on July 27, 2011 Texas


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

There is no legal requirement that one be already behind on bills before filing Chapter 13 (or, for that matter, Chapter 7), so you *can* file. Whether you should or should not is a different story, and depends upon whether you could, if you aggressively budgeted, work down your debt, or if the total you owe (e.g. including car, home, etc. as well as the credit-card debt) is too much. You should consult with a bankruptcy attorney--many will provide a free initial consultation--to explore your options, understand better what the pros and cons of filing bankruptcy are, etc. As a general matter, if you have enough income that you *could* repay the debt over a few years, even if the doing so is painful, Ch. 13 won't help you much; the court ordered payment plan will probably not be too different from what you could do yourself with a tough budget.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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