When you decide that you need help with your finances, one of the choices you may make is to meet with a bankruptcy attorney to discuss your options. One option is known as chapter 13 and you sometimes hear people call this option the debt consolidation option because it works very similar as if you consolidated your debts. Last year, one of my colleagues outlined the Bankruptcy Process Overview. This blog post will outline specifically the process of chapter 13 from start to finish.
- You must complete a credit counseling course before you file chapter 13. A link to the lists of approved credit counseling provides for the districts in Alabama, can be found by clicking on your district below:
- Your bankruptcy attorney will require you to provide information and documentation to complete your bankruptcy petition. It is important that you complete any materials given to you as best as possible since you will be signing your petition under penalty of perjury (meaning it is your responsibility to tell the truth and the whole truth in your petition).
- In addition to preparing your bankruptcy petition, your attorney will outline your chapter 13 plan. This is the document that tells the court how you intend to pay the chapter 13 trustee, what debts are to be paid by the chapter 13 trustee and what debts, if any, that you intend to pay direct.
- The automatic stay is in place immediately upon filing your petition (unless you had more than one prior bankruptcy pending within the last year).
- You must attend the meeting of creditor
- You must make your first chapter 13 payment within 30 days of filing your petition. It is essential that you keep your chapter 13 payments current, especially until your chapter 13 plan is confirmed by the court.
- It is not necessary for you to attend the confirmation hearing UNLESS your attorney tells you otherwise.
- After confirmation, you must continue to make your chapter 13 payments.
- In the Middle District of Alabama, our chapter 13 trustee will send you annual statements reflecting what debts have been paid in your plan. It is very important for you to review those statements every year and contact your bankruptcy attorney with any questions.
- You have an on-going duty to disclose any major changes to your income, any large sums of money you are entitled to receive and/or whether you have a reason to sue someone (i.e., personal injury) during the life of your chapter 13.
- You cannot incur any debt during the life of your chapter 13 or sell any property you currently own without first seeking the bankruptcy court’s permission.
- After completing your plan payments, you must complete the following to receive your discharge:
- Complete the personal financial management course. A link to the lists of approved course providers for districts in Alabama, can be found by clicking on your district below:
- File a Motion for Discharge certifying that you do not owe child support, are current on child support and that you are entitled to a discharge.
- After receiving your discharge, our office will send you a letter with instructions on how to receive your credit reports to make sure that all debts discharge in your bankruptcy are listed correctly on each report. If they are not and the information fails to be corrected, you may have cause of action under the Fair Credit Reporting Act (FCRA). Our offices can help you with that as well.
Bond & Botes, P.C. has several offices at convenient locations with experienced, knowledgeable attorneys that can help you file Chapter 13 bankruptcy and answer your questions. Contact us today and schedule your free consultation.