A Chapter 13 bankruptcy case takes three or five years in Connecticut.
A debtor who files for Chapter 13 bankruptcy in Connecticut does so with the knowledge that Chapter 13 gives a debtor advantages not offered by other bankruptcy chapters. Chapter 13 bankruptcy allows debtors to keep all of their property. During a Chapter 13 case, creditors are prohibited from attempting to collect from the debtor, and the debtor has three to five years to repay his creditors.
Commencement of Case
A debtor commences a Chapter 13 case by filing a bankruptcy petition in the Connecticut bankruptcy court serving his district. The debtor must also file his bankruptcy forms within 15 days of filing the petition. The debtor will have completed a budget or proposed debt repayment plan during his mandatory credit counseling session. The debtor must also file this debt repayment plan with the bankruptcy court. The bankruptcy court will decide whether to confirm the proposed plan.
Family Income
The debtor's income determines the length of the debt repayment plan by which he will need to abide. On one of the debtor's bankruptcy forms, the debtor must disclose his income for the previous six months. The debtor doubles this amount to come up with his yearly income for the purpose of taking the means test. The means test compares the debtor's family income to the median income for a family of the same size in Connecticut.
Connecticut Median Incomes
As of 2010, Connecticut's median incomes were listed as: $58,321 for a single earner; $72,328 for a family of two; $86,335 for a family of three; and $101,761 for a family of four. Add $7,500 for each family member in excess of four. These figures change each year, so a debtor should check the Department of Justice website to find the most up-to-date numbers.
Debt Repayment Plan
If the debtor's family income is less than the Connecticut median income for a family of the same size, his debt repayment plan will last for three years. If the debtor's family income is more than the Connecticut median income for a family of the same size, his debt repayment plan will last for five years. The U.S. Trustee will appoint a bankruptcy trustee to the debtor's case. The bankruptcy trustee acts as an intermediary between the debtor and the debtor's creditors. The debtor makes monthly debt repayment plan payments to the trustee. The trustee then distributes payment to each of the debtor's creditors until the debtor's repayment plan ends.
