If you're considering Chapter 13 bankruptcy in New York, the first thing you need to know is whether or not you're even eligible. Remember, this is a reorganization plan, which does not eliminate all of your debt. Instead, a payment plan is set up and the payment structure must be followed.
The first thing to consider is your income level. Based on the amount of debt you have, you'll be told to pay a certain amount each month. If it is determined that you don't earn enough to make the monthly payments, your filing will be denied. With no income, you may want to use Chapter 7 instead.
You can also run into issues if you don't have a regular source of income. These payments are monthly, so you must bring in enough each month to meet them. If you get sporadic payments, it can be harder to show that you'll definitely have the money on hand each month. This doesn't mean it's impossible, especially if you average enough to pay, but it can be harder.
Finally, you should know that there are debt limits that come into play. If you owe too much, you won't be able to use this plan, as the monthly payments could be quite high. These limits do change from time to time, so be sure that you check into the current levels. According to the U.S. courts, the limit is $1,149,525 for secured debts and $383,175 for unsecured debts.
If you think that you are eligible for Chapter 13 bankruptcy in New York, make sure you know exactly what legal steps to take when filing.
Source: FindLaw, "Chapter 13 Reorganization Bankruptcy," accessed Feb. 12, 2016