Filing Chapter 13 in Wyoming

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Filing bankruptcy requires compliance with both state and federal laws. This means if you are filing chapter 13 in Wyoming, you must be aware of what the requirements are and how the bankruptcy process will work. 

Chapter 13 Bankruptcy Rules

In the state of Wyoming, the vast majority of consumers who get into debt trouble and need bankruptcy relief choose either chapter 7 or chapter 13, as these are the two types of consumer bankruptcies. For some, chapter 7 is not a choice, as you need to make below the Wyoming median income and/or you need to pass a means test in order to be eligible for chapter 7 protection. Since many people do not meet these requirements and make too much income, chapter 13 has become a very common form of bankruptcy in Wyoming. 

Those who wish to file bankruptcy in the state of Wyoming must understand both the requirements and the process of a chapter 13, as there are some significant differences from chapter 7. Chapter 13 bankruptcy is an option for those who have not filed a chapter 7 in the past 6 years. Chapter 13 requires you to first complete an approved credit counseling course. If your debt exceeds certain levels, you may not be eligible for a chapter 13 bankruptcy. These levels are subject to change over time. 

Those who file chapter 13 have no requirement to relinquish or turn over any assets to be sold as part of a bankruptcy estate. This is required of chapter 7 debtors, but not chapter 13 filers, making chapter 13 a better choice for those with significant non-exempt assets in many cases. However, if an asset is acting as collateral, like a home for a mortgage, then the debt associated usually must be paid if the collateral is kept. When chapter 13 bankruptcy is filed, the income of the debtor and the amount of debt he or she has is considered. Debtors must show their income for the six months before the bankruptcy filing and demonstrate that they have the means to repay back a portion of the debts owed. 

Chapter 13 requires a repayment plan to be created that lasts between 3 years and 5 years (36 and 60 months). The plan must be proposed by the debtor but approved by the trustee and associated creditors. The plan must involve the debtor repaying a portion of all included debts. Not all debts can be included in a chapter 13, as there are those like student loans and unpaid child support debts that are not eligible for renegotiate or discharge using bankruptcy. After the repayment plan has been approved, the debtor will make his or her monthly payments to the trustee, who distributes money to the appropriate creditors. At the end of the term of the repayment plan, any debts included but not fully repaid are forgiven. 

Getting Help

The creation of a chapter 13 repayment plan that is approved is a legally and financially complex process. You'll want an experienced bankruptcy attorney to help you create a plan that will be approved and that will allow you to deal with your debt in a proactive and efficient manner.