Why You Need a Chapter 13 Attorney for Your Bankruptcy

Bankruptcy is a scary concept, especially for those facing it. What does it mean for you and your family? How does it affect your credit? What happens to your home and other major assets? The questions and trepidation are endless. The bankruptcy code contains five different chapters that each apply to a certain type of organization or individual. As an nonfarming individual you will be filing for either chapter 7 or chapter 13. These are two very different forms of bankruptcy and you will need to consult with a chapter 13 attorney in Wichita to determine which option is best for you.


Bankruptcy Chapters Applicable to Individuals

Chapter 7 bankruptcy is the most well known type and requires your assets to be liquidated so that your creditors can be paid. There is, however, the alternative of filing for chapter 13. While this chapter of bankruptcy is much more complicated than chapter 7, it allows you to retain your assets by reorganizing your debt and creating a payment plan. Due to the complicated nature of chapter 13, you are advised to seek out an attorney to actually begin the process, but this article will give you a brief overview of what you can expect.


The Chapter 13 Process

Once you and your attorney have determined that chapter 13 is your best option, you will need to file a petition with your local bankruptcy court. This petition includes a list of all your assets, both exempt and nonexempt. Exempt assets generally include essential property like cars, primary residences, clothing, and household appliances and furniture. Keep in mind, however, that even these items are exempt only to a certain dollar amount. If you live in a mansion and drive a Porsche, you’ll probably be looking for apartments and driving a Camry in the near future. The reason the court needs a list of your assets is that the value of your nonexempt assets must be paid to your unsecured creditors in order to get the green light for your debt reorganization plan.

After filing your petition, you will need to pay any and all applicable fees. Only after all of your fees have been paid in full will the court “stay” any actions against you by your creditors. This simply means that your creditors have to stop harassing you for payment while you work out your debt reorganization plan. Once your fees have been paid and your creditors stayed, you and your attorney have 15 days to file your repayment plan with the court. This plan will then be given to your creditors for consideration.

About 50 days after you file the initial bankruptcy petition, you will be required to meet with your creditors. The meeting is designed to give your creditors an opportunity to ask questions about your financial situation and your repayment plan. After this meeting you will have your bankruptcy hearing in which a judge will either confirm or deny your plan. If your chapter 13 attorney from Wichita was successful in his or her petition, you will be able to begin making payments on your new plan immediately following the hearing.