Bankruptcy Chapter 13 debt limits have changed!
In the past, in order to qualify for a chapter 13, in order to file a chapter 13 bankruptcy you had to owe less than $394,725 unsecured debt and $1,184,200 secured debt.
But now (as of December 2022) the debt limits have changed! Any individual, even if self-employed or operating an unincorporated business, is eligible for chapter 13 relief as long as the individual’s combined total secured and unsecured debts are less than $2,750,000 as of the date of filing for bankruptcy relief. 11 U.S.C. § 109(e).
In other words, you now have to owe less than $2,750,000 total of any kind of debt. This makes chapter 13 available to many more people and small businesses, which is a good thing.
These limits may not apply if the debt is “contingent” or “unliquidated.” This means the limits may not apply if you have a valid reason for disputing the validity of the obligations. If this applies to your situation, please give me a call so we discuss it more.