Chapter 13 Bankruptcy

Chapter 13 bankruptcy involves the reorganization of debt and the commitment to repay the debt over time. Unlike Chapter 7 bankruptcies, Chapter 13 bankruptcies do not involve the liquidation of assets.

With this type of bankruptcy, a trustee must ascertain whether the debtor has the means to pay off his or her debts over a period of time and to establish a payment schedule. This is a more complicated and lengthy process that can span several years.