What is a Chapter 20 Bankruptcy?
Our Las Vegas Bankruptcy Lawyer Explains
Chapter 20 bankruptcy? Never heard of it? Chapter 20 isn’t one of the chapters of bankruptcy in the bankruptcy code. This is a great piece of information to consider if you have recently filed a Chapter 7 bankruptcy. A chapter 20 bankruptcy may help if you are unexpectedly facing a debt crisis.
Imagine filing for a Chapter 7 bankruptcy and then having an unexpected emergency. An emergency that results in thousands of dollars of debt. Most people are under the assumption that if they filed a Chapter 7 bankruptcy less than eight years ago they do not have the option of filing bankruptcy again. It is true that you cannot file another Chapter 7. There is the option of receiving a discharge under a Chapter 13 bankruptcy if it has been at least 3 years since the filing of a Chapter 7. This is commonly known as a “Chapter 20” bankruptcy. This is a beneficial option for some people in financial trouble.
A “Chapter 20” can also be a strategic financial plan. For example, if someone has $20,000 in unsecured debt, and is also behind on their mortgage, or has priority debt such as taxes that a Chapter 7 will not discharge, it may be in the debtor’s best interest to file a Chapter 7 to discharge the unsecured debt and immediately file a Chapter 13 to structure a payment plan for the non-dischargeable debt.
A bankruptcy discharge will not be granted in a Nevada Chapter 13 if it is filed less than 3 years after the filing of the Chapter 7 bankruptcy. The chapter 13 will provide an affordable repayment plan on the remaining debt. If you would like more information to see if a “Chapter 20” would benefit you, please call our experienced bankruptcy attorneys at My Las Vegas Lawyers, (702) 370-0155. Find out if a Chapter 20 bankruptcy is something you qualify.