CHAPTER 13 BANKRUPTCY

Chapter 13 Bankruptcy also known as “reorganization” or “wage earner” bankruptcy. It is understood that you do wish to repay your bills but just need a little more time, or that you do not qualify for Chapter 7.

Chapter 13 Bankruptcy allows individuals to reorganize their debt. This reorganization can allow debt to be repaid over a period of 3 to 5 years.

In reorganizing your debt, you may not be responsible to pay all or a majority of your unsecured debt. This will allow you to keep your assets and pursue a debt free existence through a reasonable debt repayment plan.

The typical reasons for choosing Chapter 13 over Chapter 7 are:

1. You wish to keep your property and you have fallen behind in payments.
2. You have property that you want to keep which may not be protected in a Chapter 7
3. You are upside down (have negative equity) on your first and/or second mortgage and only want to pay back the true value of your home.
4. You are upside down (have negative equity) on your car and only want to pay the market value of your car.
5. You have tax debts that may not be fully dischargeable in Chapter 7.
6. You have received a Chapter 7 discharge within the past 8 years..

US Bankruptcy Code - Wikipedia

CHAPTER 13 TIMELINE

Determine if Bankruptcy is your only option

Have your case evaluated for free by using the form on this website. One of our Attorneys will contact you to discuss your situation and put you in touch with an Attorney in your area. There is no obligation. If it is determined that filing is in your best interests, you may choose to schedule an appointment with an Attorney to go over your financial situation in more detail.

Obtain the services of an Attorney

If you do choose to file, it is important to have an attorney at each stage of the process. Your attorney will alleviate the stress of filing for bankruptcy while providing the necessary representation to protect your interests. Once a bankruptcy is filed, everything you own or have a claim to becomes part of the bankruptcy estate. The Court will appoint a trustee to analyze and administer your estate which includes the majority of your assets and liabilities. The Trustee is most likely an attorney as well, therefore you will need the assistance of an attorney on your side to help protect your assets against the claims of the Trustee. This requires experience, knowledge of the law, diligent research, effective planning and time. To Find a competent Attorney in your area, contact us.

Filing your Case

Once you choose to file, a face to face meeting with your Attorney to go over your financial situation in more detail occurs at this time. This typically involves bringing with you all pertinent bills, pay stubs, and other documentation to file the petition with the local court. Your Attorney will draw up the necessary documents and will file them with the court on your behalf.

Once the documents have been received, the Court will also send a letter to your creditors notifying them that a Chapter 13 bankruptcy has been filed. At this point, creditors are required to discontinue any communications with you. This is known in Bankruptcy as the Automatic Stay. Once the Automatic Stay takes effect, creditors will no longer be able to:

1. Continue foreclosure proceedings against your home.
2. Continue a repossession action against your car or other property.
3. Send Collection letters.
4. Continue making harassing phone calls.
5. Begin or continue to garnish your wages.
6. Begin or continue to sue you.

An experienced attorney can help protect you from any violations of the automatic stay.

Meeting Of Creditors (typically 4 weeks after filing)

The next step in the process is a meeting with the trustee pursuant to section 341a of the bankruptcy code, also known as the Meeting of Creditors. You and your Attorney will be required to attend. After the meeting is conducted, the trustee will make a recommendation to the court on the administration of the estate. During this process, you have certain rights and protections that will need to be guarded. This can be done through effective bankruptcy planning and strong representation.

Discharge

The last step in the bankruptcy process is the discharge. The discharge is typically issued 90 days after the bankruptcy is filed. The discharge is the main reason people file for bankruptcy. It is the official cancellation of the debts pursuant to section 727 of the bankruptcy code. It includes any debts that do not survive the bankruptcy.