Bankruptcy Options
Chapter 13 Bankruptcy in Texas
Chapter 13 is a reorganization bankruptcy. Instead of discharging debt immediately, it puts you on a court-supervised repayment plan that runs three to five years. At the end of the plan, remaining eligible debt is discharged.
The Brown Law Firm handles Chapter 13 in situations where it is the right fit. Jerome does not steer clients toward Chapter 13 as a default, because many people who come in assuming they need it turn out to qualify for Chapter 7 — a faster, simpler path to the same outcome. His first job is to find out which option actually fits your circumstances.
If Chapter 13 is what your situation calls for, that is what he will recommend. If Chapter 7 or another path will accomplish your goals with less time and cost, he will tell you that instead.
When Chapter 13 is the right tool
Chapter 13 does things Chapter 7 cannot. It is most useful when one of the following is true:
- You want to save your home from foreclosure. Chapter 13 lets you catch up on missed mortgage payments through the repayment plan while keeping your home. Chapter 7 provides only a temporary stay.
- You have non-dischargeable debt you need to pay over time. Certain tax obligations and domestic support arrears cannot be wiped out, but Chapter 13 lets you pay them over the life of the plan under court supervision.
- You have assets you want to protect that Chapter 7 would not. If you own property that exceeds Texas exemption limits, a Chapter 13 plan can let you keep it by paying its value to creditors over time.
- Your income exceeds the Chapter 7 means test threshold. Some people do not pass the Chapter 7 means test based on income. Chapter 13 is the alternative that still offers a path to discharge.
Chapter 7 often accomplishes what people assume only Chapter 13 can
People arrive assuming they need Chapter 13 for a number of reasons: they heard their income is too high for Chapter 7, or that they have too many assets to qualify, or that someone else in a similar situation filed Chapter 13. Often those assumptions do not hold up under review.
Chapter 7 discharges most unsecured debt — credit cards, medical bills, personal loans — within three to six months, with no repayment plan. The two chapters serve different purposes and are not simply faster and slower versions of the same thing. Chapter 13 provides tools Chapter 7 does not, but those tools only matter if your goal actually requires them.
Jerome's approach is to understand what you are trying to accomplish first. If Chapter 7 gets you there, that is what he will recommend. If your situation genuinely calls for Chapter 13's specific protections, that is the path he will lay out.
How the Chapter 13 plan works
A Chapter 13 case follows a different path than Chapter 7:
- 1
Filing and automatic stay
When you file, the automatic stay takes effect immediately, stopping creditor calls, lawsuits, garnishments, and foreclosure proceedings.
- 2
Proposed repayment plan
You propose a three-to-five-year plan that pays creditors based on your disposable income. Priority debts like taxes and mortgage arrears are paid first.
- 3
Plan confirmation
The court reviews and confirms the plan. Creditors may object; Jerome handles those proceedings on your behalf.
- 4
Monthly payments to the trustee
You make a single monthly payment to the Chapter 13 trustee, who distributes it to your creditors according to the plan.
- 5
Discharge at completion
Once you complete the plan, remaining eligible unsecured debt is discharged and you receive your fresh start.
Common questions
How is Chapter 13 different from Chapter 7?
Chapter 7 discharges most unsecured debt within three to six months, with no repayment plan. Chapter 13 involves a three-to-five-year court-supervised repayment plan and is typically used when someone has a specific goal that Chapter 7 cannot accomplish, such as stopping a home foreclosure and catching up on mortgage arrears.
Do I earn too much to qualify for Chapter 7?
Not necessarily. Chapter 7 eligibility is based on a means test that compares your household income to the Texas median for your family size, then weighs income against allowed expenses. Many people above the median still qualify. Jerome reviews your specific numbers before drawing any conclusions.
Can Chapter 7 also stop a foreclosure?
Filing Chapter 7 triggers an automatic stay that temporarily stops foreclosure proceedings. However, it generally does not provide a mechanism to catch up on missed mortgage payments over time the way Chapter 13 does. If keeping your home and curing arrears is the priority, that is a situation where Chapter 13 may be the right tool.
What kinds of debt are better handled through Chapter 13?
Chapter 13 is often used when someone needs to catch up on a mortgage, pay non-dischargeable debt such as certain taxes or domestic support obligations over time, or protect non-exempt assets they could not keep in a Chapter 7. Each situation is different.
How do I find out which chapter applies to me?
A free case evaluation with Jerome is the right starting point. He will review your income, your debts, your goals, and your assets and give you a straight answer about which path — Chapter 7, Chapter 13, debt settlement, or something else — actually fits your situation.
Want to understand Chapter 7 first?
Chapter 7 is the most common form of bankruptcy in Texas and often the faster, simpler path to debt relief. If you're not sure which chapter applies to your situation, our Chapter 7 overview is a good place to start.
Read About Chapter 7Start with a free case evaluation
Jerome A. Brown is a Board Certified Attorney in Consumer and Business Bankruptcy with more than 40 years of experience. He will review your situation personally — income, debts, assets, and goals — and give you a straight answer about which path actually fits: Chapter 7, Chapter 13, debt settlement, or something else entirely.
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