Wis. Stat. §128.21 allows one to set up a payment plan to repay certain debts over the
course of up to three years. A debtor is allowed to choose which qualified debts to
include in the payment plan and is allowed to exclude other debts. Chapter 128
proceedings provide the debtor with many of the same protections as filing bankruptcy.
In addition, the process is much easier and less expensive than filing bankruptcy. Thus,
Chapter 128 proceedings are a unique and valuable alternative to bankruptcy available to
As stated above, the process for filing under Chapter 128 is much less complex than filing for bankruptcy. There are basically two requirements for a debtor to qualify to
file under Chapter 128.
First, the debtor must be an adult resident of the state of Wisconsin. Second, the debtor must have his / her principal source of income consist of wages or salary.
Unlike the Bankruptcy Code, Chapter 128 proceedings do not require the debtor to
include all debts. Instead, debtors may pick and choose which debts to include and
which debts to keep out of the Chapter 128. Nearly all types of unsecured debts can be
included in a Chapter 128. Common types of unsecured debts include debts from credit
cards, utility bills, medical bills, payday loans, and deficiencies. Secured debt generally
cannot be included in a Chapter 128. Some common types of secured debt include
mortgages and car loans. The law does give a secured creditor the option to be included
and thus it is up to the secured creditor whether they want to be included in the
A Chapter 128 also stops future interest from accruing on any debts that are included in the petition.
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Filing under Chapter 128 provides many of the same protections as filing under the Bankruptcy Code. Once filed, a Chapter 128 prohibits creditors from executing any
attachments on the debtor's property.
In addition, a Chapter 128 prohibits creditors from garnishing wages or from attempting to collect on a debt that is included in the Chapter 128 petition. A Chapter 128 also stops future interest from accruing on any debts that are included in
There are a few ways in which a Chapter 128 differs from bankruptcy. Unlike bankruptcy, all debts included in the Chapter 128 petition must be repaid. Thus, a debtor cannot get a discharge of any debt from filing under Chapter 128.
Another important difference is that creditors are still able to get a judgment against the debtor during a Chapter 128. However, even if the creditor does get a judgment for the debt, the creditor cannot collect on the judgment pending the Chapter 128 proceedings.
Chapter 128 is alternative form of debt relief that can be an option for you
Fees for filing a Chapter 128 are generally much less than fees for filing bankruptcy.
The reason is the relative simplicity of filing under Chapter 128 as compared to filing
bankruptcy. Kryshak Law Office offers low fixed rates and flexible payment plans.
Please contact Kryshak Law Office to set up your FREE initial consultation to determine
if filing under Chapter 128 is an option for your specific financial situation.