Chapter 13 bankruptcy is different from all other types of bankruptcy due to the rules surrounding it. The main purpose of filing for chapter 13 bankruptcy is to allow an indivudual to pay off their debts at a lower interest rate than they would have otherwise. In some cases, after filing for this type of bankruptcy an individual can have the chance to pay off their debts without having to pay any interest at all on them.
This particular chapter of bankruptcy is most often filed for when an individual is facing foreclosure on their house, when they owe a large amount in back child support, when their car is about to be repossed and when they have college loans they are not able to pay back.
To determine whether or not you are eligible to file for this bankruptcy you need to consider factors such as the amount of your salary versus the amount of money you need to pay bills, feed your family and live your life. In order to become eligible you must also attend credit counseling services within 180 days prior to filing for bankruptcy. If you have had a bankruptcy case dismissed within the previous 180 days you are also not eligible to file for bankruptcy again.
Filing for this type of bankruptcy often requires you to consult a bankruptcy lawyer to get the answers to all the questions and concerns you have about the process. You will then need to gather up all the material that you will have to show a judge to prove to them that you should be able to file for bankruptcy. The next step is to fill out paperwork and the petition that will be submitted to the court, stating your case.
Once you have filed for Chapter 13 bankruptcy you are given a window of three to five years in which you must pay off your debts in full. Your unsecured liabilities are gathered together and rolled into a repayment plan. This is referred to as restructuring your debts.
Chapter 13 bankruptcy is often preferred over Chapter 7 bankruptcy protects anyone else who may be in debt with you. Part of having his type of bankruptcy claim is having a trustee to review an individual’s debts You will have to make monthly payments to your trustee until your debt is completely paid off.
When you have filed for this type of bankruptcy you have certain restrictions placed on you. One of them is that you may not take on something such as a car loan while you are in the bankruptcy process unless a judge grants you permission. Any collatoral that you have during this period of time in your life must be insured.
Get More Information – Filing for chapter 13 bankruptcy can be the best way to start your life over financially.