Understanding Chapter 13 Bankruptcy
I don’t know a thing about you but I’ll bet that you don’t know much about bankruptcy laws. Well, if you haven’t known it yet, Chapter 13 is one of the many types of bankruptcy. Chapter 13 however, is no available for any situations. It is only available for certain situation and only for the best qualified.
Quick Outline of Chapter 13 Bankruptcy
If you are wondering who can file for Chapter 13, let me tell you this. Chapter 13 can only be filed by individuals who have a steady and secured income.
A Chapter 13 is a repayment plan. Debts are not wiped clean. Instead the individual agrees to a plan in court that established repayment of debts. Creditors also must agree to the plan, which is based on the individual’s income.
Steps in Filing Chapter 13 Bankruptcy
The new bankruptcy laws require you to first eek counseling about your credits. You will then need to file paperwork before the process of Chapter 13 begins.
In the process, your income and debts are being looked at. A payment plan is then devised based according to your income. In order to continue with the repayment plan, both you and your creditors have to agree with the plan.
It is not easy filing for paperwork and going to court and the best suggestion I can offer you are that you should hire a lawyer to assist and guide you. Under watchful eyes of an experienced lawyer and the court, you don’t have anything to worry about. The court will ensure that you would be able to afford the repayment plan.
This can take some time to finalize but in the end you are protected and your creditors are getting paid.
What You Need to Know
Many people wonder why to file a Chapter 13. Since it is a repayment plan you are not getting debts wiped away so why not just do debt consolidation instead? The easy answer to that is the court’s involvement in the bankruptcy process.
As mentioned above, you should file for Chapter 13 instead of debt consolidation because the court can protect you. Other than that, you will also have more options. The court will ensure that you are able to afford the repayment plan and thus treated like a willing party.
Other than that, once you are in the process of bankruptcy, creditors are not allowed to pursue collections thus; you will be able to protect your assets.
Your goal? Start utilizing the knowledge you have acquired her but you also have to remember that there are many negative effect of bankruptcy so, is always best to avoid it. Try working together with your creditors if you feel that you are facing financial problems.
If you are declared a bankrupt, it means that you have problems in taking loans in the future. Worst still, the bankruptcy record will stick with you for almost 10 years! Get to know how you can avoid Bankruptcy and find out more about Chapter 7 Exemptions
Related posts:
- Should I Consider Chapter 13 Or Chapter 7 Bankruptcy?
- Chapter Seven Bankruptcy Laws Post 2005
- The Means Test For Chapter 7
- Chapter 7 Bankruptcy Law
- Chapter 13 Bankruptcy – Reasons To File
- Chapter 7 Bankruptcy
- What Is The Plan In A Chapter 13 Bankruptcy?
- Some Facts Regarding Chapter 13 Bankruptcy
- How To Claim Bankruptcy Post 2005
- A Look At Chapter Seven Exemptions