In April 2016, the debt limits for Chapter 13 bankruptcy increased for people filing after that date. A bankruptcy attorney can explain qualification requirements and other restrictions that impact Chapter 13 bankruptcy filers.
Chapter 13 Debt Limits
On April 1, 2016, the upper debit limits for Chapter 13 bankruptcy increased, however there are still restrictions on qualifying debts. To qualify for Chapter 13 bankruptcy, debtors must have less than $1,184,200 in secured loans and less than $394,725 in unsecured loans.
Based on consumer price inflation information, federal bankruptcy debt limits are adjusted every three years. 2016 limits represent a small increase over 2013 limits. The debt limits placed on Chapter 13 bankruptcy filers may rule out this type of relief for some debtors. Some people may have too much debt to file a Chapter 13 bankruptcy, but there are no debt limits to file a Chapter 7 bankruptcy. A bankruptcy attorney can outline the differences, advantages and disadvantages between the two types of filings.
Filing for Bankruptcy in Illinois
Bankruptcy rules and procedures are established primarily by federal law, so the filing process in Illinois is similar to that in other states. However, Illinois law requires some specific information that must be included in bankruptcy documents, and it also controls allowable bankruptcy exemptions. Before filing for bankruptcy in Illinois, debtors must complete a certified credit counseling course, submit required bankruptcy forms, and file in the proper Illinois court.
- Credit Counseling Course – Debtors must complete a credit counseling course from an approved agency within the immediate six months prior to filing. In most cases, there is a fee for the course, but courses can be completed in person, over the telephone, or online.
- Bankruptcy Forms – When filing for bankruptcy, debtors must complete a bankruptcy petition and several schedules that include all property, income, debts, income, and other information. Debtors must also complete a form that references the “means test.”
- Bankruptcy Courts – In Illinois, there are three federal judicial districts where bankruptcy filers must file. Debtors must file in the district where they have been living for the majority of the 180-day period before filing, or in the district where they maintain their permanent home.
Since Illinois imposes state bankruptcy laws that impact filing rules and procedures, an Illinois bankruptcy attorney is required to oversee the process. It’s essential that all required information is provided and necessary forms are filed in the proper court district.