Who Is a Good Candidate for Chapter 13 Bankruptcy in Texas?

 Posted on May 09, 2025 in Bankruptcy

When most people unfamiliar with bankruptcy think about what it means, they tend to imagine the specifics of Chapter 7 bankruptcy. After all, this is the most common type of bankruptcy, in which a debtor liquidates their nonexempt assets to pay back creditors and in exchange gets many of their debts discharged. Chapter 7 is a good option for many people, but it may not be the right option for everyone. Chapter 13 bankruptcy is also a powerful tool for individuals facing significant debts. For some, Chapter 13 might be the best choice, and for others, it could be the only option available. A knowledgeable Wise County, TX Chapter 13 bankruptcy attorney can review your financial situation and advise you on what type of bankruptcy might be best to file for.

What Is Chapter 13 Bankruptcy?

Chapter 13 bankruptcy allows individuals to make a court-approved payment plan to repay their debts over three to five years. Chapter 13 is sometimes called the "wage earner’s bankruptcy" because it tends to be a good fit for people with a steady income to make the monthly payments.

When is Chapter 13 Bankruptcy a Good Fit? 

There are many factors that influence who is a good candidate for Chapter 13 bankruptcy, and there is no substitute for the individualized guidance of an experienced bankruptcy attorney. However, some of the indicators that Chapter 13 might be right for you include:

You Are Not Eligible for Chapter 7

If your income is too high to pass the means test required to file for Chapter 7, Chapter 13 might be the right choice for you. You must also meet eligibility requirements for Chapter 13, however. Financially, that means that your unsecured debts must be less than $526,700 and your secured debts must be less than $1,580,125 on the day you file. 

You Want to Keep Your Assets

In Chapter 13, your assets are generally not liquidated to pay back your debt. Rather, you pay back that debt with the repayment plan over some time. If you want to hold onto your assets and have significant assets that would not be exempt under Chapter 7, Chapter 13 could be the best choice for you. 

You Have Many Non-dischargeable Debts

Not all debts are dischargeable in Chapter 7. Things like child support, tax debts, and student loans are not dischargeable in bankruptcy. However, under Chapter 13, you would pay back these debts through a more manageable repayment plan.

Call a Wise County, TX Chapter 13 Bankruptcy Attorney 

Filing for bankruptcy can be a difficult decision, and it helps to have guidance from an experienced Arlington, TX bankruptcy attorney about the process and whether you may be a good candidate for Chapter 13. At Acker Warren P.C., we value our clients and will always speak directly with you to discuss pending legal matters. Call the law firm at 817-752-9033 to consult with one of our attorneys, in person or virtually.