Chapter 13 Bankruptcy
For those who have been struck by short-term financial hardships like illness, job loss or significant unexpected expenses, Chapter 13 bank-
ruptcy can be an effective way to reestablish financial stability. For those who have been knocked off balance by a crisis, but have regular income
with which to make monthly payments, Chapter 13 bankruptcy can provide a powerful safety net.
Chapter 13 bankruptcy combines the automatic stay feature with a 3-5 year payment plan for catching up on payments, which makes it an at-
tractive option for those seeking to avoid repossession or stop foreclosure.
The Chapter 13 bankruptcy process is detailed and complex. Making mistakes can mean the loss of the automatic stay, the rejection of a pay-
ment plan, or extensions and delays for the bankruptcy filer. If you’re not sure if Chapter 13 bankruptcy is the right choice for you, you should
consider consulting a bankruptcy lawyer in your area.
If you do choose to file under Chapter 13 bankruptcy, your bankruptcy attorney will be able to advise you during your filing process and help
you navigate the various filing requirements and deadlines involved. Your lawyer can make sure your proposed plan will leave room for regular
expenses as well as payments and affirm that you’ve accounted for all your allowable expenses.
Chapter 13 Bankruptcy Cases: Pre-Filing Requirements
New legislation enacted in October, 2005 dictated that all those filing personal bankruptcy under Chapter 13 or Chapter 7 of the United
States Bankruptcy Code must complete a Credit Counseling Briefing approved by the U.S. Trustee. When your bankruptcy lawyer files your
bankruptcy petition, he will also file your Credit Counseling certificate.
Those who attempt to file bankruptcy without a Credit Counseling certificate may not be accepted, which can be disastrous. A dismissal might
give creditors an opportunity to take collection action, including foreclosure proceedings and repossessions, since the automatic stay would not
be in effect.