Losing control of your finances is never easy. If you have recently lost income or acquired an excess number of bills that you cannot realistically afford, bankruptcy may be an option to consider. If you have sufficient income for paying a portion of your debt, your attorney will advise you on filing chapter 13. With this guide, you will understand the process of filing chapter 13 so you can gain back control of your financial future.
Consultation
Schedule a consultation with a bankruptcy attorney that will look over your bank statements, pay stubs, and an overview of your monthly bills and living expenses. Using a standard test, the attorney will see if you have the means to pay some of your accumulated debt.
If you do not have the means of paying a portion of the debt, chapter 7, which wipes out your debt completely, may be a better option.
There are benefits to filing chapter 13 instead of chapter 7. Chapter 7 will affect your credit for a longer period of time. In addition, chapter 13 allows you to keep your home out of foreclosure and your car from being repossessed.
Your attorney will be able to discuss benefits that pertain to your specific situation.
Counseling
Once you and your attorney decide chapter 13 is right for you, you must enroll in a credit counseling program. This course will teach you the basics of budgeting, helping you manage your finances during the repayment process and after the bankruptcy has been discharged.
It is important to note that the credit counseling program is a requirement. You must be enrolled in and complete the class within 180 days before filing.
File
Once you complete the counseling and furnish the attorney with a certificate, a repayment plan will be designed, proposed, and filed.
After counseling, your attorney will work with you to design a plan to pay down your debts.
The repayment plan will include monthly payments that will be made to a bankruptcy trust. The monthly payment will be based on the total balances and your available income after basic living expenses.
Stay and Confirm
After the proposal is filed and approved, an automatic stay is placed on your debt. This prevents creditors from contacting you in hopes of collecting on their debts.
The bankruptcy will then be confirmed, starting the process of repayments.
Filing chapter 13 is not for everyone. With the help of your attorney, you can gain back control of your finances by filing chapter 13 bankruptcy. You can contact companies like Dunbar & Dunbar for more information.
Share1 February 2018
