Preparing for Chapter 13 Bankruptcy
It’s never easy to make the decision to file for bankruptcy. If you’ve been experiencing financial hardship and are in debt, Chapter 13 bankruptcy may be right for you. It can help you restructure your debt with a reorganization plan that will fit your budget. To survive bankruptcy you need to understand the process. You also need to develop habits that will help you stay within your Chapter 13 budget. Here are some bankruptcy help and preparation tips to help you through the process.
Gather Your Financial Records
Take the time to gather all your financial records including tax returns, bank statements, and paystubs. If you can’t provide originals, do your best to get copies. Additionally, ensure you prepare and file your tax returns. That must be done to file for bankruptcy.
Complete All the Paperwork
You will be required to fill out up to 50 pages of information regarding your debts, assets, income, and financial history. The paperwork required when filing bankruptcy can be time-consuming, confusing and overwhelming. These forms are intended to give the court an overview of your financial situation.
This paperwork will be the backbone of your bankruptcy case. Therefore it’s crucial that you are honest, accurate, and thorough. Don’t rush when preparing your Chapter 13 bankruptcy papers. If you do happen to leave something out, it can come back and cause trouble later on.
Inform Creditors of the Bankruptcy
Creditors must stop automatic deductions once they receive notice of your bankruptcy filing. However, most won’t stop instantly when you file for bankruptcy. If you’ve set up automatic deductions, these can take longer to stop. Notifying your creditors via email or fax of your Chapter 13 filing status can speed up the cessation of your charges. Be sure to include your bankruptcy case number, filing date, and the court where you filed. This will work for wage garnishments, vehicle repossessions, and various other financial obligations.
Create a Budget & Stick to It
One of the most important keys to surviving bankruptcy is developing a budget and sticking to it. With a Chapter 13 filing, the amount you’ll have to pay will depend on your disposable income. This is calculated by deducting allowed monthly personal and household expenses from your take-home pay.
You need to learn how to live with less, so cut back on non-essentials like vacations, eating out, and cable TV. Once you’ve made a few tweaks to your lifestyle, you can adjust to living in your new budget.
Make a Promise to Yourself
The court will not take things lightly if you incur more debt. Running up debt within the first 90 days of filing can be very damaging to your case. This is why it’s essential to avoid using your credit cards. Don’t get large cash advances or transfer balances. Once you file for a Chapter 13 bankruptcy you must show you are trying to be financially responsible.
By all means, don’t transfer assets out of your name. This will make it appear as though you’re hiding assets or trying to keep certain ones unfairly. Chapter 13 allows you to retain many of your assets, so be truthful in your dealings with filing and the court.
At Bartifay Law Offices, we offer Chapter 13 bankruptcy help so you can get a fresh financial start. Call us today to set up a consultation with one of our attorneys to discuss your case.