Chapter 13 is reorganization under the bankruptcy code.  A debtor submits all of his disposible income for the benefit of creditors over a term of 36 to 60 months.  Secured creditors such as mortgage arrears or auto payments are paid as a priority while unsecured debts like credit card charges are paid as a non-priority.  A debtor receives a discharge under Chapter 13 once the payment plan is completed.

Chapter 13 is not an easy undertaking.  The debtor must budget strictly and provide payments to some creditors outside of the Chapter 13 plan.  For example, if someone is using Chapter 13 to repay mortgage arrears, the person must continue to make timely mortgage payments outside of the Chapter 13.  If the debtor fails to make the required payments, the creditor will be able to avoid the bankruptcy protection and pursue the debt and the property. 

There are several pre-filing requirements that must be satisfied before relief can be obtained.  They include a credit counseling briefing, submission of four years of federal tax returns and sixty days worth of pay advices just prior to filing.  If the requirements are not satisfied, the case may be dismissed on the forty-sixth day after filing.