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Understanding The Important Changes In Chapter 13 Bankruptcy Payment And StepsBy filing a chapter 13 bankruptcy foreclosure of your homes to your creditors could be avoided. Typically, chapter 13 allows bankruptcy filers to reorganize their finances to pay off their creditors through a court supervised monthly repayment schedule that usually extends from 3 to 5 years. Nevertheless, it is imperative for probable bankruptcy filers to know the steps which are followed as well as the changes in payments when filing a chapter 13 bankruptcy. By filing a chapter 13 bankruptcy foreclosure of your homes to your creditors could be avoided. Typically, chapter 13 allows bankruptcy filers to reorganize their finances to pay off their creditors through a court supervised monthly repayment schedule that usually extends from 3 to 5 years. These payments are made to the to the chapter 13 bankruptcy trustee every month through direct deduction from the wages. However, a debtor is required to pay some of the debts and not all. The unpaid balance qualifies for a discharge after the payment plan ends. Under tenets of the personal bankruptcy laws, the debtor retains the right to continue owning the house and the car until he maintains regularity in making monthly payments. Nevertheless, it is imperative for probable bankruptcy filers to know the steps which are followed as well as the changes in payments when filing a chapter 13 bankruptcy. Steps involved in filing a chapter 13 bankruptcy 1. When a bankruptcy petition is filed with the bankruptcy court, a chapter 13 trustee is appointed for administration of the case. There is only one trustee in a chapter 13 unlike in a chapter 7 bankruptcy petition wherein there could be more than one trustee called the “interim”. 2. Your bankruptcy attorney submits a chapter 13 monthly repayment plan which includes details about proposed monthly installments and time duration required, along with your bankruptcy petition. 3. The amount of money to be paid to the trustee each month actually depends upon your current monthly income minus the monthly expenses. 4. 5 days after the filing of the petition, the trustee sends notice to the debtor’s creditors to whom he owes money. Alternatively, even the bankruptcy filer gets a notice determining his eligibility for a chapter 13. 5. Within 30 days of filing for bankruptcy under chapter 13, the trustee issues a notice to both the bankruptcy filer and his creditors for the 341 meeting wherein the creditors are likely to raise objections against the proposed plan. 6. After a bankruptcy filer is approved for a chapter 13 bankruptcy through a confirmation hearing, the debtor is required to make his first chapter 13 bankruptcy payment to the trustee either in the form of a money order or by issuing a cashier’s check. Get Free Bankruptcy Evaluation from Experienced Bankruptcy Attorney http://www.bankruptcyonly.com/apply-bankruptcy-application.php Changes in payments during a chapter 13 bankruptcy A debtor is required to pay his monthly payments regularly to the trustee for a period of 3 to 5 years. If in case, the debtor is unable to maintain a regularity in monthly payments for whatever reasons ranging from loss of job to having a baby, the bankruptcy process makes it mandatory for him to file a “Motion to Modify” the chapter 13 plan with the help of his lawyer. All that a debtor could be required to furnish is details of latest income and monthly financial budget along with an explanation why he cannot pay his chapter 13 payment. Another critical aspect of a chapter 13 bankruptcy is that if during the process the debtor needs to purchase something by going into debt, the attorney needs to file a “Motion to Incur Debt” on the debtor’s behalf. This permits the debtor to get access to the credit facility for purchasing the desired commodity. To get more information about personal bankruptcy laws, it is recommended to get professional help from free bankruptcy services employed by reputed online service providers like Bankruptcyonly. As a community-building service, TMCnet allows user submitted content which is not always proofed by TMCnet editors. If you feel this entry is of inferior quality or wish to report it for some reason, please forward the URL to "webedit [AT] tmcnet [DOT] com" with your comments. |