Call Now!
Call Us 414-326-9231 608-260-7133 Text Us 414-326-4709

Chapter 128: What is this Wisconsin bankruptcy alternative?

When filing for federal bankruptcy relief, debtors have to go through a fairly burdensome process -- they must submit property statements, financial disclosures, go through debt counseling, go through the "means" test to see if they qualify for bankruptcy relief (and, if so, what kind) and struggle to determine what property they can keep under various exemptions.

Chapter 128, by comparison, is a much simpler process. Existing only in state law, it's a program available to Wisconsin residents who want to pull themselves out of debt without going through bankruptcy. It's begun with a simple petition and an affidavit of debts and generally doesn't require the debtor to appear in court.

It's important to realize that Chapter 128 is very unlike bankruptcy in that it doesn't offer any discharge of debts -- that power resides only within the federal bankruptcy program. What it usually does, however, is stop interest from accruing on credit card and other unsecured debts and halts collection efforts (including distressing phone calls). It can also halt garnishments. This gives the debtor a chance to make good on all of his or her debts through an established repayment plan, without being buried under layers of interest, late-fees and missed payment penalties. This makes it a particularly good option for people who have gotten trapped in an endless cycle of payday loans that they can no longer handle repaying.

Just like in a bankruptcy, a trustee is appointed to handle the repayment plan for the debtor. The trustee's fees (which have to be paid by the debtor) are usually rolled into the debtor's monthly repayment plan. The trustee takes on the responsibility of notifying the debtor's creditors about the Chapter 128 filing and handles any objections that arise. The debtor makes one monthly payment to the trustee, and the trustee distributes the funds according the repayment plan that's been established.

Is Chapter 128 right for you? If you have a steady source of income and believe that you could repay your debts if you were given a fair opportunity and a chance to dig yourself out of never-ending additional interest and other penalties, it is worth considering. However, only an attorney can give you correct advice for your particular situation, once he or she has reviewed your case.

Source:, "Chapter 128," Dec. 19, 2016

No Comments

Leave a comment
Comment Information
Email Us For A Response

Free Case Evaluation

* indicates required field

Miller & Miller Law, LLC
  • VISA
  • Master Cards
  • Discover
Milwaukee Office map Madison Office map Kenosha Office map

633 W Wisconsin Ave, Suite 500
Milwaukee, WI 53203

Phone: 414-312-6581
Fax: 414-277-1303
Milwaukee Office

2810 Crossroads Drive
Suite 4001
Madison, WI 53718

Phone: 608-260-7133
Madison Office

6123 Green Bay Road
Suite 210
Kenosha, WI 53142

Phone: 262-326-1669
Kenosha Office

Appleton Office
4321 W. College Ave.
Suite 200
Appleton, WI 54914

Phone: 920-280-3838
Appleton Office

Brookfield Office
200 S. Executive Drive
Suite 101
Brookfield, WI 53005

Phone: 262-261-0665
Brookfield Office

Glendale Office
6333 N. Green Bay Avenue
Glendale, WI 53209

Phone: 414-973-8662
Glendale Office

Fax: 414-277-1303 - We also have offices in Appleton, Glendale and Brookfield to better serve you.