The automatic stay goes into effect when your petition is filed. The stay prevents creditors from further collection activities against you including foreclosure , wage garnishment and lawsuits. Chapter 13 is a good option for those wanting to retain property such as their vehicle or house. The plan helps debtors make payments on secured debt with lower payments and reduced interest rates. Chapter 13 may allow you to retain non-exempt property that Chapter 7 bankruptcy may have liquidated.
If you have a co-debtor or co-signer they may be protected under Chapter 13 with the co-debtor stay; in Chapter 7 they could be liable for outstanding debt after you file your case. For sole business owners, Chapter 13 bankruptcy can help your business stay running while debts are being reorganized. Certain unsecured debts may be eligible for discharge or you may not be required to make payment to certain creditors.
Chapter 13 bankruptcy is often considered if you income exceeds requirements for Chapter 7 after taking the means test. Chapter 13 is good option for those who want legal assistance in repaying debt obligations.