You should consider a Chapter 13 plan if you can work out a way to pay off part of your debts over a period of time and still afford the reasonable costs of living.

The law says you can use a Chapter 13 plan if you have a steady income. This means you work for wages, own a small business or receive pension, social security or other benefits. You also must owe less than approximately $750,000 in secured debts, such as a mortgage, and less than approximately $250,000 in other debts.

If you qualify for Chapter 13, you and your lawyer must work out a plan for the court to approve. The plan must show how you intend to pay all or part of your debts. Certain debts must be paid in full. These include secured debts, federal or state income taxes that you have incurred in the past three years, and the court, trustee and attorney fees involved in setting up and carrying out the plan.