Can I File Chapter 13 If I Am Retired?

A Chapter 13 bankruptcy case is a reorganization of debts. This chapter of bankruptcy is available to individuals and married couples. Individuals of all ages file under Chapter 13 for debt relief, including young adults, middle-aged parents, and retired senior citizens. There is no age limit for an adult who needs to file a Chapter 13 petition.

Why Would a Retiree Need to File Bankruptcy?

Even though a person is retired, that person might need bankruptcy relief for a variety of reasons. Examples of reasons why some Phoenix and Las Vegas retirees might need to file a Chapter 13 include:

• A decrease in income because pension or retirement income runs out (outliving retirement savings);
• An increase in expenses because of a change in housing, health, or family responsibilities;
• The need to raise a grandchild or support a grown child;
• An accident or illness that creates substantial medical costs for the retiree, spouse, or dependent;
• The loss of a spouse by death or divorce;
• Expenses and bills exceed the person’s monthly fixed income; and,
• Carrying too much debt into retirement.

Whatever the reason, seniors and retirees experience financial problems just like people of all ages. When a person cannot afford to pay his debts after paying for basic living expenses, a bankruptcy case might be necessary to provide the debt relief the person needs to get back on his feet.

Chapter 7 vs. Chapter 13 for Retirees

A Chapter 7 bankruptcy case might be a good option if the retiree does not have excess disposable income or substantial equity in non-exempt assets. The Chapter 7 case could discharge unsecured debts and provide much-needed debt relief in four to six months.

However, many retirees have accumulated assets throughout their lives that could be at risk in a Chapter 7 case. Therefore, a Chapter 13 bankruptcy filing might be the best option to protect the retiree’s income and assets. Also, there are some things you can do through a Chapter 13 case that you cannot accomplish with a Chapter 7 bankruptcy.

Our Phoenix bankruptcy lawyers carefully analyze each person’s situation to determine the best bankruptcy option to give the person the best possible results from filing a bankruptcy petition.

Is the Chapter 13 Bankruptcy Process Different When You Are Retired?

No, the bankruptcy process is the same regardless of whether you a retired, self-employed, or working for another person or company. However, each situation can retire a slightly different approach, additional forms, or the filing of various motions. Your Chapter 13 case will be structured based on your specific financial situation and financial history.

The first step is scheduling a free consultation with our Las Vegas bankruptcy lawyer to analyze your finances to determine if a Chapter 13 bankruptcy filing is in our best interest. If filing a Chapter 13 will give you the best resolution to your debt problem, our team of legal professionals walks you through each step in the Chapter 13 process while providing support and guidance.

Before filing your bankruptcy petition, you must complete a credit counseling course. The courses are available online, in person, and by telephone to make it easy and convenient to complete the course. The cost is relatively low with some companies offering classes for as low as $25 for a couple. Our staff can provide a list of approved companies in Arizona for the credit counseling course.

Once your course is complete, you review and sign your bankruptcy forms. We want to ensure that your information is complete and accurate; therefore, we review each page with you to ensure accuracy before filing. Once your forms are signed, our staff electronically files the forms to obtain a bankruptcy case number.

Attending Hearings and Beginning Your Chapter 13 Plan

When the petition is filed, we also file a Chapter 13 plan. The repayment plan explains to the court and your creditors how you intend to resolve your debt problem. We will thoroughly explain the plan to you so that you know exactly what you need to pay and when you need to make the payment.

You are required to attend the 341 First Meeting of Creditors, but this is a short, informal hearing with the Chapter 13 trustee. We will inform you if you are required to attend the Confirmation Hearing. Your bankruptcy lawyer attends each hearing with you, and our staff prepares you before the hearing, so you feel less stressed.

Completing Your Chapter 13 Plan

Once your plan is confirmed, you continue making your payments for the term of the plan. At the completion of your plan, you will receive your bankruptcy discharge, and your case is closed. Our team of legal professionals helps you each step of the way because we want you to be successful in Chapter 13, so you can put this debt problem behind you and enjoy your retirement.