The purpose of a chapter 13 bankruptcy is to essentially reorganize your payments to pay off some of your past-due and current debts over a period of three to five years. Under the chapter 13 you can keep property such as your home and car by making payments to a court appointed trustee. These payments typically include the monthly payment on the mortgage or car loan and an extra payment to bring the past due account current. A chapter 13 requires you to have enough income to pay for necessities and keep up with the required payments.

Unsecured creditors receive a percentage of what is owned on the debt, depending on your ability to pay. At the end of the bankruptcy most unsecured debts are discharged.

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