What happens when you file a Chapter 13?

Steps to Obtaining Debt Relief

When you file for bankruptcy under chapter 13, you must give your bankruptcy attorney a list of ALL your debts. You must also give your lawyer a list of everything you own. You must tell your attorney everything about your money situation. A bankruptcy attorney will tell you about the two kinds of bankruptcy, Chapter 7 and Chapter 13. Before you file a Chapter 13, you and your lawyer for bankruptcy work out a payment plan. The attorney prepares your Chapter 13 papers (the petition and other documents – like a wage order).

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The Bankruptcy Petition is Filed with the Court

You read and sign the bankruptcy petition and Chapter 13 Plan.  You must swear under oath and penalties of perjury that as far as you know the information is correct.  Failure to disclose all information to the bankruptcy court could be a criminal offense.

Your bankruptcy lawyer files the petition with the court.  The court notifies every creditor listed in your petition that you have filed a Chapter 13 bankruptcy. The Court also notifies them when to come to the creditors’ meeting. You and your attorney must attend the meeting of creditors . There, the Chapter 13 trustee will ask you questions. This is to make sure your petition is  complete and correct. Your creditors may also ask about your debts and what you own, your income, etc.

The Bankruptcy Court Must Approve Your Chapter 13 Plan

If the court approves your Chapter 13 payment plan, you will then make payments to the Trustee, usually by wage assignment sent to your employer. The chapter 13 Trustee makes sure the money goes to your creditors each month. Usually the payments are taken out of your pay check and sent to the Trustee. You must make all your Chapter 13 payments in full and on time. If you miss a payment, the Trustee may ask the court to dismiss your case. If that happens, the court can’t protect your property from creditors, and no debt will be discharged or reduced.

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