Financial problems can happen to anyone. Recovering from these problems is what matters most. One option Pennsylvania residents have when dealing with a financial crisis is to file for Chapter 13 bankruptcy protection. Chapter 13 protection will allow you to reorganize your debts and stop collection activity.
Is Chapter 13 Bankruptcy the right choice for you?
The first thing that you must do is look at the amount and types of debt you have. Chapter 13 bankruptcy is generally used for those with a mortgage who want to save their home by restructuring their debts. However, if your debts are too high compared to your income, the court may deny your request for Chapter 13 and recommend a different filing.
Steps to take when filing for Chapter 13 bankruptcy
When you are ready to file for Chapter 13 bankruptcy, you are encouraged to take the following steps:
- Gather all income and financial information
- Gather information on all debts
- Prepare all documents requested by the court
- File all forms with the court
- Meet with the court trustee to review your repayment plan
Once you have met with the trustee, you must attend a confirmation hearing. This hearing will confirm the repayment plan that you have made with the trustee. Once the hearing is finalized, you will begin to repay your debts within 30 days.
Your payments will be made directly to the trustee, who will disburse your payments to your creditors. You will need to make this payment on time each month for the bankruptcy terms to stay in place. Once you have fulfilled your repayment obligation, the bankruptcy will be discharged.