The Chattanooga Free Press reports that Chapter 13 debtors in Tennessee pay more back to creditors than much larger states like Texas, California or New York.   As of September 30, 2008, Tennesseans had paid back over $558 million in active Chapter 13 cases.  Texas Chapter 13 filers were second on the list, paying back $528 million, with Georgia third at $412 million.

Unlike most states, Tennessee debtors file a higher percentage of Chapter 13 cases.  Here, 56% of debtors in 2008 filed Chapter 13, whereas in other states the percentage is much lower.  In California, for example, Chapter 13 amounted to only 19% of cases filed – with 81% of California debtors filing Chapter 7.

Chapter 13, of course, is the repayment plan type of bankruptcy, whereas Chapter 7 permits debtors to wipe out debt.

What does this mean to you?  The trustees and judges in Tennessee bankruptcy courts prefer repayment plans as opposed to debt elimination.  These bankruptcy officials also will try to push you to pay back as much as they can get you to pay.

An experienced consumer bankruptcy lawyer working on your behalf will identify and pursue a form of debt relief that is most advantageous to you.   A good bankruptcy lawyer will serve as your advocate and fight for Chapter 7 relief where appropriate, or create a payment plan that is liveable for you.