Chapter 13 is a procedure for individuals with a regular source of income to reorganize their debt while under the protection of the Bankruptcy Court.   Unlike Chapter 7, it does not involve the potential liquidation of your property by a bankruptcy trustee.

Chapter 13 is often used is stop a mortgage foreclosure and propose a plan to catch mortgage payments up-to-date.  During the first phase of a Chapter 13 plan  (typically the first 4 years), the mortgage is caught up-to-date. During the second phase of the  plan  (typically another l year), you  pay your mortgage payments directly to the mortgage company and continue with monthly payments to the Chapter 13 Trustee in an amount sufficient to pay a dividend to your unsecured creditors. The payments under a Chapter l3 plan are made to the Chapter l3 Trustee.  

Chapter 13 is also often by individuals who do not have mortgage problems, but who have credit card, loan, medical bill, etc. problems.  In such cases, a Chapter 13 Plan is often proposed with monthly payments over 3 or 5 years sufficient to pay a dividend to unsecured creditors. Usually only a small portion of the unsecured debt is required to be paid.