What is the maximum debt limit for Chapter 13 bankruptcy?
One debt relief option out there is Chapter 13 bankruptcy. Whether a Chapter 13 bankruptcy is a good fit for a given person who is facing difficulties related to debt depends on a great range of factors. One is whether they would be eligible for this type of bankruptcy.
There are some things that can disqualify a person from Chapter 13 eligibility. One is if they have too much debt. This is because, under U.S. bankruptcy law, there is a maximum debt limit for Chapter 13 bankruptcy.
This debt limit sets two debt ceilings for a Chapter 13 bankruptcy; one is for secured debts and the other is for unsecured debts. Secured debt is debt that has collateral backing it, while unsecured debt is debt that does not. Currently, the secured debt ceiling is $1,149,525 and the unsecured debt ceiling is $383,175. Generally, if a person’s debts are not lower than both of these ceilings, the person will not be eligible for a Chapter 13 bankruptcy. As a note, changes are made to the amounts of these ceilings on a periodic basis.
As the maximum debt limit for Chapter 13 bankruptcy illustrates, there are a variety of different things that can impact what specific bankruptcy options are available to a person. Bankruptcy lawyers here in Florida can provide individuals in the state with guidance on what sorts of bankruptcy types they do and do not have eligibility for given their debt situation, their financial situation and their other individual circumstances.
Source: United States Courts, “Chapter 13 – Individual Debt Adjustment,” Accessed March 30, 2015