Filing Chapter 13 Bankruptcy? What You Must Include In The Petition And How This Info Is Used

Deciding to file for bankruptcy can be a tough decision. However, if you are paying more in monthly expenses than you have coming in, this may help you rearrange your debt so you can afford to pay it off, or eliminate some of your debt so you can get back on track financially. When you are ready to file for chapter 13 bankruptcy, there is certain information that must be included in your petition. Learning what information you must enclose and how it is used will help you to better understand what to expect from the process.

A List of Creditors and Debt Amounts

One of the things you will need to file with your bankruptcy petition is a full list of creditors you have, what type of debt it is and the amount of the debt. It is important that you submit a full list of creditors, including those that you are not discharging. For example, you may not be discharging your student debt, but it is important to still list this creditor and the amount with your filing. Listing all of your debt helps determine what debts can be discharged, while also helping a judge figure out how much you can afford to pay toward a debt repayment plan. If you don't list all your debt, they may think you have more disposable income than you do.

Information About Your Income

Another important piece of information that has to be included with your chapter 13 bankruptcy filing is information regarding your income. The courts need to see where your income comes from, the amount of your income and how frequently you are paid. Typically, they would like to see your last 60 days worth of pay stubs as well as your tax return from the previous year. Finding out how much you make helps a court determine whether you are able to pay your bills as is, or whether you are truly bankrupt. It also comes into play when setting up a repayment plan.

A List of Your Valuable Possessions

When you file for bankruptcy, you have to make a list of all of the valuable possessions you own, including what you estimate their value to be. This includes things like houses, vehicles, bank accounts and jewelry. The dollar amount that makes an item valuable varies from state to state so always check with a credit counselor or bankruptcy attorney to find the dollar amount for your state to ensure you fully disclose everything. It is also important to note that you still have to disclose the item, even if it isn't paid off. For example, if your car isn't paid off, you still must disclose it. If you have a large number of valuable possessions, you may be forced to sell off these possessions to cover your debt, or have to pay the value of them to debtors if you wish to keep them.

A Detailed List of Your Living Expenses

One of the most challenging things for most individuals to come up with is a detailed list of your living expenses. Most experts recommend keeping a detailed list of everything you spend money on for a couple of months before you file for bankruptcy to help you with this list. You need to provide the courts with a detailed list of your expenses, including food, rent, clothing, insurance and child care. This allows the court to determine how much, if anything, you can afford to repay to creditors monthly. The last thing you want is to underestimate your expenses and not have enough to pay your bills while going through bankruptcy proceedings.

Filing for chapter 13 bankruptcy can be the key to getting you back onto your feet financially. A judge can restructure your debt so you can make payments that you can afford to creditors, or wipe out some of your debt. However, in order to do this, you must provide them with the documentation they need to determine where you stand financially at this point in time. If you fail to include the necessary information, your case can be thrown out, and you will have to re-file, which wastes time that could otherwise be spent getting your life in order. When you are ready to file for bankruptcy, include a list of your creditors and the amount you owe them, detailed information about your income, a list of your assets and a list of your monthly expenditures.

For more information, contact a professional like John G Rhyne Attorney At Law.