Understanding Chapter 13 Bankruptcy
June 22, 2008 – 4:09 pmI 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.
The Chapter 13 Bankruptcy
Chapter 13 can be filed by individuals. It can only be filed by an individual who has a steady and secure source of income.
What exactly is Chapter 13? Chapter 13 is actually a repayment plan. Individual will work together with the court, and creditor to come out with a repayment plan which is based according to the individual’s income.
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.
It may take up a lot of you time before it gets finalize but you will be on the winning end after all the trouble you went through.
Things to Know
Have you ever wondered why you should file a Chapter 13? It is just a repayment plan, so why don’t you just consolidate your debts instead? Well, the answer is you can get the court’s involvement in the process.
Why court involvement? By having court involvement, you can have more protection and options. The court will ensure that you can afford the repayment. You are considered a willing party instead of being demanded for unreasonable payment plan you cannot afford.
Additionally, once you file for bankruptcy you are protected. Creditors can no longer pursue collections. That means you may be able to protect your assets and prevent court cases.
Of course, as with bankruptcy in general, it is always best to avoid it if possible. You can start with trying to get creditors to work with you and then only move to bankruptcy if you are feeling threatened with losing assets and court proceedings.
Tags: Bankruptcy
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