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What is Chapter 13 Bankruptcy?

Depending on your financial situation, you may decide to File Chapter 13 Bankruptcy. Chapter 13 is often referred to as the wage earner’s plan. This type of bankruptcy allows you to devise a plan to repay your debts. This type of bankruptcy is best suited for individuals with a steady income. When you File Chapter 13 Bankruptcy, you submit a plan to make payments to your creditors over a 3-year period. In some cases, the court may authorize a five-year payment period. However, the payment period cannot extend beyond five years.

Benefits of Filing Chapter 13 Bankruptcy

If you own your own home, Chapter 13 can provide you with the opportunity to save your home from possible foreclosure. If your home is under foreclosure proceedings, filing Chapter 13 can stop the proceedings. You must continue to make your mortgage payments on time. In addition, you are required to bring the payments up-to-date. You may be able to lower your monthly payments on your unsecured debt allowing you to avoid costly late fees. In addition, if you had a cosigner on consumer debt, the cosigner is protected if you file Chapter 13. Essentially, filing Chapter 13 is similar to obtaining a consolidation loan. You pay your payments to a trustee who will distribute the funds to creditors. Filing Chapter 13 prevents collection calls and collection activities. You do not have direct contact with your creditors.

devise a plan to repay your debts. This type of bankruptcy is best suited for individuals with a steady income. When you File Chapter 13 Bankruptcy, you submit a plan to make payments to your creditors over a 3-year period. In some cases, the court may authorize a five-year payment period. However, the payment period cannot extend beyond five years.Depending on your financial situation, you may decide to File Chapter 13 Bankruptcy. Chapter 13 is often referred to as the wage earner’s plan. This type of bankruptcy allows you to devise a plan to repay your debts. This type of bankruptcy is best suited for individuals with a steady income. When you File Chapter 13 Bankruptcy, you submit a plan to make payments to your creditors over a 3-year period. In some cases, the court may authorize a five-year payment period. However, the payment period cannot extend beyond five years.?

What happens when you File Chapter 13 Bankruptcy

The process begins when you file a voluntary petition along with the filing fee of $274. You are required to file the following information in addition to the petition:

  • Schedules of assets and liabilities
  • Schedule of current income and expenditures
  • Schedule of executory contracts and unexpired leases
  • Statement of financial affairs
  • In addition, you are required to file a copy of a repayment plan devised through the services of credit counseling and a certification you completed credit counseling. There may be more requirements depending on your specific case. You may choose to hire an attorney who can handle the process for you. An attorney can ensure all necessary documents and requirements are met.

Once you have filed Chapter 13, an automatic stay is issued. This means creditors covered under the Chapter 13 filing must cease all collection activities. These activities include but are not limited to wage garnishments and collection calls. The bankruptcy clerk will issue notification to the creditors listed in the Chapter 13 filing.

Within 20 to 50 days after filing the initial petition, a trustee will initiate a meeting of creditors. You are sworn under oath and must answer questions asked by the trustee and creditors. If you have hired an attorney, you attorney will be present. This meeting is to resolve any issues or concerns regarding your proposal of a repayment plan. You can avoid unnecessary problems by reviewing the plan with the trustee before the meeting. If you have hired an attorney, your attorney may be able to resolve any potential issue prior to the meeting. There will be a final hearing on the case to determine if the repayment plan will be approved.

Top 3 Chapter 13 Bankruptcy Questions

If you are considering filing Chapter 13 bankruptcy, you may undoubtedly have several questions and concerns. While you are not required to hire an attorney to file bankruptcy, it is recommended you seek the advice of an attorney. An attorney will provide you with answers based on your specific financial situation. However, there are general answers to many of the top Chapter 13 Bankruptcy Questions.

The Most Asked Chapter 13 Bankruptcy Questions:

  1. 1. How do I File Chapter 13?

Chapter 13 begins with completing a two-page petition to the court requesting relief under Chapter 13 bankruptcy. Once the petition is filed with the courts and automatic stay is in place. All creditors must cease collection activities including phone calls. In addition, this stay may protect against repossession or foreclosure activities. You can choose to complete the petition and file it on your own, or you can hire an attorney to begin the process for you.

  1. 2. What is a 341 meeting?

This is a meeting with all of your creditors. For many people, the prospect of meeting with creditors is cause for anxiety. However, you are assigned a court appointed Trustee who will be present at this meeting. If you have hired an attorney, he or she may also appear. The purpose of this meeting is to develop a repayment plan that meets the needs of the debtor and creditors.

  1. 3. If the repayment plan is approved, whom do I pay?

Once your repayment plan is accepted, you will make one monthly payment to the Trustee. The Trustee will pay each of your creditors. The payment must be made by the agreed upon date.
Chapter 13 bankruptcy can help your reorganize your finances and manage your existing debt. It will also prevent creditors from calling you to collect on the debt. For many people, Chapter 13 has helped them become debt free within three to five years.

 

Chapter 13 Bankruptcy Lawyer

If you are ready to File Chapter 13 Bankruptcy, you may want to get a free evaluation from a local attorney. An attorney can help you through the entire bankruptcy process. It is important that all documents be completed accurately in order to obtain a favorable outcome. You will be under any obligation once you have received your free