If you would like to file for bankruptcy but do not know where to start, an experienced lawyer can help guide the process every step of the way. Bankruptcy is a complex legal procedure, and it can be mentally and emotionally trying.
Considering that, the more information you have about your options and the better informed you could be, the more comfortable you will feel about taking this next step.
Are You Prepared To File For Bankruptcy?
Filing for bankruptcy is, for most people, the last resort. Most people don’t file for bankruptcy unless they have exhausted all other alternatives, and for most people, bankruptcy is a last resort.
Bankruptcy is what happens when you can no longer pay your debts. The debts include credit card bills, medical bills, student loans, mortgages, car loans, even alimony. Bankruptcy is a method of eradicating debt.
Anyone of any age can file for bankruptcy.
- It doesn’t matter how old you are.
- It doesn’t matter how much you earn.
- It doesn’t matter where you live.
- It doesn’t matter whether you have a job or whether you’ve lost your job.
- It doesn’t matter whether you have children or grandchildren.
As long as you live, you have debts. Debts are obligations you owe to others.
How Does Chapter 13 work?
Chapter 13 is similar to Chapter 11, which is usually applicable to companies. In both instances, the petitioner presents a reorganization plan that protects assets against seizure or foreclosure and usually includes a request for debt forgiveness.
Both are distinct from the more severe Chapter 7 filing, which effectively liquidates all assets save those expressly safeguarded.
No bankruptcy discharges all obligations. Payments of child support and alimony and the majority of school loans and some kinds of taxes are not dischargeable.
However, bankruptcy may eliminate various other obligations, though it will almost certainly make future borrowing more difficult.
How To Become Eligible for Chapter 13
To qualify for Chapter 13 bankruptcy, an individual must have a total unsecured debt of no more than $419,275, including credit card bills and personal loans.
Additionally, they are limited to $1,257,850 in secured debt, which includes mortgages and auto loans. Monthly updates are made to these statistics to account for the cost-of-living index.
One of Chapter 13’s provisions enables you to halt a foreclosure attempt on your property. Filing a Chapter 13 petition halts any ongoing foreclosure procedures and suspends payment of any other outstanding obligations.
This delays the court’s consideration of the proposal but does not erase the debt. Hopefully, the bankruptcy plan will free up enough of your income for you to continue making regular mortgage payments and retain your home.
How Can You Initiate A Chapter 13 Bankruptcy Filing?
Under Chapter 13, you and your lawyer will work together to demonstrate your qualification for debt restructuring to the bankruptcy trustee, who will oversee the procedures.
You’ll receive court approval for a repayment plan that includes partial or complete repayment of both unsecured and secured obligations.
You’ll settle over 4 to 5 years while maintaining ownership of your possessions. Finally, the court may pardon the balance of some obligations.
The Legal Process
When you’ve decided to file, you’ll follow these steps:
- Credit counseling: Complete credit counseling before declaring bankruptcy with a nonprofit credit counseling organization. Additionally, your advisor may assist you in developing a repayment plan.
- Retain an attorney: Retain the services of a competent bankruptcy attorney. Chapter 13 is a complex process, and skipping a step or improperly filling out paperwork could cause, in your case, being rejected or some obligations being unpaid.
- Complete paperwork: Your lawyer will assist you in completing the different paperwork necessary for filing. You’ll have to compile data on your whole economic state, including your debts, earnings, assets, and monthly expenditures.
- File bankruptcy complaint: Also referred to as “filing” bankruptcy, the procedure begins with submitting the necessary paperwork. A trustee in bankruptcy will be assigned. When you file for bankruptcy, you trigger what is known as an “automatic stay,” which means that the majority of efforts to collect on your debts must stop.
- You must provide a suggested payment plan within 14 days of filing the petition. Within 30 days after the petition’s submission, you must begin paying payments on the plan, even if it has not yet been authorized.
- Between 21 to 50 days after filing the petition, the trustee will convene a meeting of creditors to address any outstanding problems with you.
- Confirmation hearing: Within 45 days after the creditors’ meeting, you, the trustee, and any creditors present in court will convene to confirm the payment plan.
- Payment: Creditors are paid according to the plan’s terms over a three- to five-year period.
- Before filing for Chapter 13, you must take a “debtor education course” offered by a nonprofit credit counseling organization.
Find An Attorney That’s Right For You
Attorneys make the world go round, or so the saying goes. And, while it seems self-evident, their representation is a service, and like all services, it depends upon the quality of service.
When you’re looking for a Chapter 13 bankruptcy lawyer, you’ll want to find someone attentive to your needs.
A bankruptcy attorney should be someone you can relate to, who understands what you are going through. They should make you comfortable, and they should put you at ease.
The bankruptcy process can be intimidating and confusing. To help you clear the fog, your attorney should speak with you, explain the process, and answer your questions. They should spend as much time with you as you need, and you should never feel rushed.
A Bankruptcy Attorney’s Roles
- A good bankruptcy lawyer will be attentive to your needs and should respond quickly and efficiently. They should keep you informed throughout the entire process.
- A good bankruptcy lawyer should also take the time to explain the advantages of bankruptcy for you and your family and the benefits it can provide.
- A good bankruptcy lawyer should also explain the bankruptcy process and answer all of your questions. They should explain the consequences of bankruptcy, and offer you options, and should take the time to explain why bankruptcy, or which avenue of bankruptcy, is the best choice for you.
- A reliable bankruptcy attorney should be capable of helping you through the entire process, from preparing your bankruptcy petition to preparing your repayment plan to filing your bankruptcy petition and completing your bankruptcy plan.
- A good bankruptcy lawyer should be attentive and should have time for you.
Indeed, a competent bankruptcy attorney can assist you in determining if you are eligible to file for bankruptcy, which Phoenix Fresh Start Bankruptcy Attorney can do for you.
Hire a Phoenix Bankruptcy Attorney Today!
In conclusion, you can file for bankruptcy with an attorney. You do not have to handle the legal complexities on your own, as some people are under the misconception. An attorney can explain how Chapter 13 bankruptcy works in detail.
They are well versed in the law and know how to take care of each type of situation that can arise when filing for Chapter 13 bankruptcy. This will allow you to focus on the other aspects of your life that need attention while your attorney focuses on this aspect for you—concerned about bankruptcy? Consult one of our Phoenix Bankruptcy Attorneys now!