Step By Step Guide: Chapter 13 Bankruptcy Process
If have assets your are looking to keep, like property, homes or cars chapter 13 bankruptcy is the way to go. With Chapter 13 bankruptcy you pay back your debt over 3 to 5 years with little to no interest. This way if you have assets that are important you and want to keep you won’t have to liquidate them like you do with Chapter 7 bankruptcy.
1. First you petition with the court to bring you relief under chapter 13. A petition is a two-page form, which is signed by the debtor and the attorney.
2. After the petition has been filed you will be given a docket number. Which means you have officially “filed” a chapter 13 bankruptcy and you have an automatic stay. No creditors may demand money from you now or harass you. You also need this docket number to stop any foreclosure proceedings.
3. After you file your petition you will need to submit a list of all your creditors, with their names and addresses to the bankruptcy court.
4. After you submit a list of the creditors you will need to submit your assets, liabilities, income, expenses, past financial history and you plan outlining how your propose to reorganize you debt and pay it off under the chapter 13 bankruptcy. You must prove that you capable of paying off the debt.
5. After you file the above paper work, you will have another opportunity, if need, to file amendments as necessary. For instance you may need to add a creditor or modify the schedules etc. The amendments may require an additional fee for your lawyer as well as for the bankruptcy court.
WHAT HAPPENS AT A CHAPTER 13 TRUSTEES MEETING
Usually you don’t see a judge about your case, unless something has been contested, instead you will have a chapter 13 trustee meeting. The meeting usually takes place one to three months after you have filed the bankruptcy petition.
At the meeting can consist of everyone you owe money to, who you listed on your paperwork. At the meeting they will be given an opportunity to ask any questions regarding your financial situation, which may affect the plan you have proposed. Usually though few if any of your creditors attend. Most likely the large creditors, the holder of your mortgage or someone you might owe a large sum of money to will attend.
Also your attorney or someone from their firm will be at the meeting to represent you and speak on your behalf as needed. The person asking the questions and meeting coordinator will be the chapter 13 trustee. If all goes well there will be only one meeting, if there are no objections raised, all that is left to do is make all payments outlined in your plan in a timely manner.
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