Essential Things You Should Know About Chapter 13 Bankruptcy

Are you struggling to pay your debts, and no matter how you try, you simply cannot catch up? Chapter 13 bankruptcy can offer a fresh start. But before you proceed with this option, you should take the time to understand how the process works. Knowing more will help determine if bankruptcy is right for you and why a Chapter 13 bankruptcy lawyer is needed. This post will answer some common questions you may be asking.

What's Chapter 13 Bankruptcy?

This form of liquidation allows those who have debts to structure their repayments and catch up. Generally, one is allowed to make payments within a couple of years and then the funds are shared amongst the creditors. 

If you have assets and don't want to offer them as collateral or an income, this form of bankruptcy will be an ideal option. After you make all the required payments, which might not be the entire amount you owe, the other debts can be discharged.

Is It Vital to Consult a Lawyer Before Filing Chapter 13 Bankruptcy?

Working with an experienced Chapter 13 bankruptcy lawyer will come in handy. First, the lawyer will review your debt situation and determine if Chapter 13 bankruptcy is the best option for you. Then they will help you prepare all the documents you need to file the liquidation petition and prepare you for court. The knowledge and advice they offer will be invaluable. If there are some court proceedings, the lawyer will represent you. 

What Is Required When Filing This Liquidation Petition?

If you want to file a successful Chapter 13 bankruptcy petition, you will need to have all the required documents ready. The documents should contain all the relevant information too. The bankruptcy process will be delayed if you fail to fill in the key information or forget to add a form. Here are some documents you should include in your petition:

• The list of all creditors and the amount you owe
• List of your properties
• Source of income, including the amount you earn and frequency
• A clear outline of your monthly expenses
• A copy of your recent tax return

Will There Be Any Consequences?

Yes, you can expect to have some negative consequences after filing the liquidation petition. For instance, you will be required to comply with the strict budget during the repayment period and will not get help from any creditor. You shouldn't drop out of the payment program before completing the required amount. Even after paying, the case will affect your debtor's credit report up to a decade after filing.

For more information, reach out to a chapter 13 bankruptcy service near you.