When you are in debt, you may have explored all options for relief before deciding that bankruptcy is in your best interest. For many, this is not an easy decision to make, but it can provide consumers with much-needed financial relief. Additionally, you’ll find that understanding the steps involved in Chapter 13 bankruptcy can help you best prepare for this complex process. However, though it’s in your best interest to familiarize yourself with this process, it’s imperative to connect with a Memphis, TN Chapter 13 bankruptcy lawyer to ensure everything goes as smoothly as possible.
What Is Chapter 13 Bankruptcy?
When you file for bankruptcy as a consumer, you’ll find you generally have two options – Chapter 7 or Chapter 13. Chapter 7 is a short process that involves the liquidation of assets to pay back creditors. However, to qualify, you must pass a means test, showing that you make less than the average income for your state.
As such, most people must file Chapter 13 when declaring bankruptcy. This process involves creating a repayment plan that lasts three to five years to pay back creditors.
What Are the Steps in This Process?
The first step in declaring bankruptcy is to take a credit counseling course. This must be done 180 days before filing for bankruptcy. This course must be taken through an approved counseling course. Generally, this process is to explore other options for repaying without filing for bankruptcy.
Once you have taken the necessary credit counseling course, the next step is to file. You must provide a list of all creditors and how much you owe, all your assets, tax information, your monthly expenses, and proof of your income. After filing, you will be assigned a court clerk who will grant an automatic stay, meaning collectors must halt all collection efforts against you.
Next, your bankruptcy trustee will host a meeting of creditors to ask questions. Finally, you will receive your Chapter 13 repayment plan and begin making payments. However, you may find that at the confirmation hearings, your creditors may object to the payments. If this occurs, the judge will allow you to adjust your plan before confirming it.
Should I Connect With a Lawyer?
As you can see, filing for Chapter 13 bankruptcy can be overwhelming and complex if you are unfamiliar with how to proceed. That’s why it’s in your best interest to connect with an experienced attorney who can guide you through these challenging matters to ensure everything goes smoothly. Unfortunately, those who try to file on their own may find that they make errors that can invalidate their filing.
When you are ready for a financial fresh start, the team at the Arnold Law Firm is here to assist you. Our team Will do everything in our power to help guide you through these complex times to ensure you receive the best possible outcome for your circumstances. Connect with us today during a free consultation to learn how we can assist you.
