If you are prepared to file for Chapter 13 bankruptcy, chances are that you might feel a little nervous right now. Going through a bankruptcy case can leave a person feeling this way, but going through a case can also provide you with a new, fresh financial start. As you prepare for this, here are several things you should expect during your case.
You Must Make Your Payments
One of the unique aspects of Chapter 13 bankruptcy is the payments it requires. Your lawyer will work hard with the bankruptcy court by creating a repayment plan that works for your budget and needs. Your responsibility after the court approves it is to make the scheduled payments. You may need to make these weekly, biweekly, or monthly, and your plan will state the frequency. You will also need to know the amount you must pay, which will always be the same. You must also know how to pay for it. You might be able to do this through check or money order, or you might be required to do it electronically.
You Must Live Within Your Budget
The repayment plan you have allows you to keep some of your income each month. The amount you get to keep is the money you can use for regular living expenses, such as food and gas. You will need to learn how to live within your budget during this time because you will only have a small amount of your income at your disposal. You cannot overspend because of this, and you cannot apply for lines of credit, credit cards, or loans.
You Must Notify the Trustee of Changes
During your plan, you also need to make sure you notify the trustee if you experience any financial changes. For example, if your employer decides to give you a raise or a bonus, you cannot hide this from the trustee. You must reveal this event to the trustee, and the trustee may adjust your repayment plan afterward.
You must also notify the trustee of changes in your debts. If you get sick and end up in the ER, you could wind up with a lot of medical bills that you must pay. If this occurs, you need to notify the trustee about these new debts.
Going through a Chapter 13 plan takes up to five years, but it is not forever. If you have questions, call a Chapter 13 bankruptcy lawyer today.