Is your debt starting to take over your life? You never expected to fall into the financial rut you are in but may have had to max out credit cards and apply for personal loans due to medical expenses, household emergencies, and other issues that have occurred over the span of several years. Now that you owe so much money to assorted creditors, you are probably wondering if you will ever get the chance to pay it all back. If you have been making some of your payments a bit late, the creditors might even be charging hefty late fees that are only contributing to your debt.

Despite working and having a regular source of income, catching up on payments and paying off all your debt may be out of the question simply because you do not have enough money to cover your daily expenses and all the debt repayments. If you feel like your situation is only getting worse and you are now receiving calls from debt collectors hounding you and attempting to get you to pay what you owe, bankruptcy is an option you should think about. In fact, because you are employed, chapter 13 bankruptcy may be the most suitable option.

What Is Chapter 13 Bankruptcy? 

Chapter 13 bankruptcy is a form of bankruptcy that allows you to create a payment plan that works best for you rather than constantly trying to pay hundreds of dollars each month to various creditors. You are essentially still going to pay back what you owe, but it may be possible to work out an agreement where you are paying much less each month. In fact, the right bankruptcy lawyer will even negotiate with the creditors on your behalf to reduce the amount you owe. If the lawyer can have the total debt amount reduced by a large percentage, you are not going to need to worry about paying back nearly as much money as you would have initially needed to pay back if you did not file for chapter 13 bankruptcy.

Who Is Eligible to File Chapter 13?

Not everyone is eligible to file for chapter 13. If you would like to file this way, you must be able to provide proof of a reliable source of income that would allow you to make smaller payments back to your creditors over time through the payment plan. The debt you owe back to creditors and lenders for personal loans should add up to no more than $394,000. It is also the ideal method of filing for bankruptcy if you currently own non-exempt property that would get sold to pay some of your debt off if you were to file chapter 13 bankruptcy.

If your goal is to get out of debt without experiencing such a financial strain, you should think about filing chapter 13 bankruptcy. It may be the best option for you if you are employed, have a steady source of income, and are looking to make a payment agreement to get your debt paid off over time.