Your bankruptcy options.

Filing a Chapter 13 bankruptcy.

When someone files for Chapter 13 bankruptcy, they intend to continue to pay their debt, albeit at better terms with lower or no interest. Unlike a Chapter 7 filing which involves liquidation of assets, this process will utilize the debtor’s income to pay off the creditors. The debtor does have a regular income and thus can afford to request such adjustments and reductions.

Under the United States Bankruptcy Code the debtor is given a period of up to 5 years to repay the creditors in the filing. While your counsel will be representing your interests, the entire filing process is carried out under the supervision of the courts.

While debtors property is not liquidated, the court administers new interest free plan for repayment of the debts. A written plan is drafted to provide details of the repayment. The repayment must begin shortly (usually within 30-45 days) after the case has started. In some cases the debtor will disburse funds to a trustee who would take care of disbursing money to the creditors as per the plan. In other cases, the debtor can pay the creditors directly. Under all plans, the creditors must adhere the repayment plan approved by the court and are prohibited from trying to collect excess sums from the debtor.

Under a Chapter 13 filing, a debtor that manages to complete all necessary payments in the plan, is given a full discharge. A repayment plan is created by the court even if creditors disagree with it. The most important criteria for a person to be able to file for Chapter 13 bankruptcy is that the individual must have a regular and continuing income.

The filing of a Chapter 13 Bankruptcy would approximate the following:

Determine whether Chapter 13 is the best solution for you.
Prepare a budget.
Examine individual cases to figure out whether require filing of Chapter 13 bankruptcy, or can other alternatives be explored.
Determine and implement methods of dealing with secured creditors.
Devise a chapter 13 plan, and fill out the forms.
Pay the filing fee and complete the process of filing the forms and pleadings.
Attend whatever meetings you maybe required to attend; with the creditors, court hearings etc.
Obtain a discharge once the payments have all been made, and the plan terminated.

The process may seem simple but a lot more to the process of filing for bankruptcy. Consult with competent counsel, utilize site like this to explore alternatives and use the information to determine the path that suits your needs the best.
 

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