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
A Chapter 13 requires you to first abide by the new bankruptcy laws and seek credit counseling. You will then file paperwork and the process will begin.
During a Chapter 13 your income and debts are looked at and a payment plan is devised based upon your income. You and your creditors must agree to the legally binding repayment plan.
You will have to file a lot of paperwork and attend court hearings. It is often smart to have a lawyer who can help you with negotiations with creditors. The process can be frustrating, but you are under the watchful eye of the court and also protected by the court, so you have nothing to worry about. The court will help you to reach a repayment plan you can live with.
This can take some time to finalize but in the end you are protected and your creditors are getting paid.
Things 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.
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.
Other than that, another advantage of filing for bankruptcy is that you are protected from creditors when you file for bankruptcy.
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.
No comments:
Post a Comment