Bankruptcy Plan with an End in Sight
Bankruptcy Filings... (Photo credit: MyEyeSees)
Chapter 13 Difficult to Complete
For the people who have been forced to file a bankruptcy in order to get back on their financial feet, one of the hardest types of bankruptcies to file and complete is a Chapter 13. The plan of a Chapter 13 is not only difficult to properly devise, it is very hard to maintain and complete. Over 60% of Chapter 13 filers fail to complete the process for one reason or the other. Many of the failures are converted to a Chapter 7 bankruptcy. So when a Chapter 13 plan is successful or an end in sight, there is great joy for the filers.
Personal Bankruptcy Story
This joyful filer recently shared her personal bankruptcy story on a bankruptcy forum website and had this to say about the experience: “I can’t believe it’s my turn to do the happy dance!!! All payments in, paperwork sent to court to get discharge, case scheduled to close per trustee on 2/29/2012! FIVE YEARS!! I had two babies (to add to the two I already had) during this whole mess, so it’s been tough on us all, but now in the end I feel empowered to move on and stay smart about finances! This forum has been SO helpful!! Thanks!”
Chapter 13 Described
A Chapter 13, often called the wager earner’s plan, is for those filers who have a steady income. When you first apply for this type of bankruptcy, you must submit a plan to be confirmed by the bankruptcy court to pay back all or a portion of your debts over a 3 or 5 year plan. The plan is figured on any monthly disposable money you may have after paying normal living expenses as described by bankruptcy law.
The monthly disposable income is used by a bankruptcy court trustee to pay your unsecured debts in order of priority. If you only have enough disposable income to pay only a portion of your unsecured debts, the remaining unsecured debts that are non-exempt from bankruptcy discharges will be forgiven at the close of your bankruptcy. You must stay current on your secured loans during the plan or be willing to surrender you secured property.
The Need for Help in Devising the Plan
Because of the complexities of bankruptcy law, a Chapter 13 plan in particular is difficult to properly devise, and most filers need the help of an experienced bankruptcy attorney to be successful. There should be no wonderment in those who have successfully completed a Chapter 13 plan that they are often very exuberant after completing the plan.
What It Takes to Finish a Chapter 13 Plan
There is no big secret as to what it takes to finish a Chapter 13 plan. Learning to live on a budget, being disciplined in your commitment to stay on the budget, and determination to complete the process are necessary elements in completing your plan. Staying healthy and a certain amount of luck can also apply.
It is amazing that the woman sharing her personal bankruptcy story gave birth to two children adding to the other two she already had, all while going through a Chapter 13 plan. Now that is commitment to process.
Related articles
- Vices in a Chapter 13 (betterbankruptcy.com)
- Rental Allowance in a Chapter 13 Bankruptcy (betterbankruptcy.com)
- How to File for Bankruptcy (answers.com)
- Bankruptcy Basics: Six Basic Types of Bankruptcies (betterbankruptcy.com)
