Chapter 13 Debt Limits, 2020
As you might know, Chapter 13 bankruptcy involves repaying some or all of your debt. People will sometimes ask, “do I qualify for chapter 13?” The answer, like to many legal questions is, “it depends.” One factor of many involves the Chapter 13 debt limits.
To qualify for Chapter 13, which is officially called a reorganization bankruptcy, a few things have to be looked at. First, a good Los Angeles bankruptcy attorney will examine your cash flow. That is, can you afford to repay your debts? Or are you struggling to keep your lights on?
Second, you have to compare your debts against the debt limits. These numbers constantly change. And to be honest, we bankruptcy lawyers have to look them up, since in most cases they’re not a factor. And just when we learn them, they change again.
So, the most recent numbers out there for the Chapter 13 debt limits 2020 are
- Unsecured debt: $419,275
- Secured debt: $1,257,850
These values took effect on 4/1/2019, and seem to be still be the most current. Normally, you’d check a government website for updated values. However, as of this writing, even the courts are still listing the chapter 13 debt limits that are from before 2019.
Even this is oversimplifying things, because where do lawsuits fall? That is, if someone has taken you to court, is it a secured debt or an unsecured one? What if you think you’ll win: does it count as a debt at all?
Another issue arises with student loans, particularly if you cosigned as a parent plus loan and it’s not really your debt. Or is it?
Further, tax debt is another tricky one. Is it unsecured, secured or both? And what if it’s priority, can it also count against the unsecured debt?
There are a lot more issues that can arise, so you’ll want to consult with a skilled Los Angeles bankruptcy attorney who specializes in Chapter 13 bankruptcy.