How it Chapter 13 works

Before you can file for bankruptcy you must receive credit counseling from the approved agencies under the United states Trustee's Office. You will receive a certificate at the completion of your counseling sessions. You must file this certificate with the court, along with a packet of forms listing what you own, earn, owe and spend. Also needed will be your federal tax return for the previous year and proof the you filed both federal and state tax returns for the past four years. This is where a local attorney can help you stay organized and make sure all of the paper work is in order. Finally you will have to submit a repayment plan showing how you will pay off your debt.

A debtor can keep all of their property, while court approves a new interest-free plan for repayment. You will receive a written plan that gives you the all of the transactions that will occur, and the duration of the same. You repayments must begin within 30 to 45 days after the case has started.

Chapter 13 begins with petition and filing

File with the court:

-Schedules of assets and liabilities

-Schedule of current income and expenditures

-contracts un-expired leases

-statement of financial affairs

-Certificate of credit counseling and copy of any debt repayment plan developed through credit counseling.

-Evidence of payment from employers

-Statement of Monthly net income and any anticipated increase

-record of any interest the you have in federal or state qualified education or tuition accounts.

Provide the Chapter 13 case trustee:

-A copy of tax return or transcripts for the most recent tax year

-Tax returns filed during the case

-Tax returns for prior years that had not been filed when case began

Bankruptcy forms:

-A list of all creditors and the amounts and nature of their claims

-The source amount and frequency of your income

-A list of all of your property

-Detailed list of monthly living expenses

After you get all of filing completion

You will be appointed a impartial trustee to administer the case. When filing the petition under Chapter 13 stops most collection actions against you and your property. A creditor may not seek to collect a consumer debt from any individual who is liable along with your (co-debtors).

Meeting

Somewhere between 20 to 50 days after you file the Chapter 13 petition your trustee will hold a meeting of creditors. If the U.S. trustee of bankruptcy administrator schedules the meeting at a place that does not have regular U.S. trustee or bankruptcy administrator staffing, the meeting may be held no more than 60 days after the debtor files.

At the meeting you will be under oath and both the trustee and creditors may ask questions. In order to preserve their independent judgment, bankruptcy judges are prohibited from attending the creditors' meeting.

The parties will finally resolve any problems with the plan. You can avoid problems by making sure the petition and plan are complete and accurate. A lawyer may come in helpful in the completion.

Unsecured creditors must file their claims with the court within 90 days after the first date set for this meeting. A governmental unit will have 180 days from the set date of the meeting.

After the meeting

You, the chapter 13 trustee and creditors who attending will go to court for a hearing on the your repayment plan.

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