CHAPTER 13 FREQUENTLY ASKED QUESTIONS:
What is a Chapter 13 Bankruptcy and how does it work?
Chapter 13 is a form of bankruptcy whereby you pay creditors according to a payment plan set up by my office. Unsecured creditors, for example credit cards, medical and utility bills receive a percentage of what you owe them and secured creditors, for example car and home loans, receive 100% of what you owe them (if you decide to keep the property). Your monthly net income minus your necessary monthly expenses yields your Chapter 13 plan payment. Generally, in a Chapter 13, you retain all of your possessions. Debtors that would benefit from a Chapter 13 are those who owe income taxes, large mortgage arrearages, student loans and back child support. Also, a Debtor that has assets that can be lost in a Chapter 7 may wish to file a Chapter 13.
Do I have to appear in Court for a Chapter 13 Bankruptcy?
You may have to appear in Court after appearing at a mandatory meeting of creditors, formally known as the 341 Meeting.
How long after the filing do I receive a notice to appear at the 341 Meeting?
You receive the 341 Meeting Notice about two weeks after the filing and the meeting date is usually four to five weeks after the date of filing.
What happens at the meeting and what do I need to take to the meeting?
At the 341 Meeting, creditors may question you regarding their collateral. If this is a joint case both Debtors must attend this hearing. In a Chapter 13, a second hearing is held for approval or "confirmation" of your case. In most instances clients do not need to be present at the second hearing.
Where is the hearing held and how long does it last?
The 341 Meeting is held at 170 North High Street on the 2nd Floor and lasts from ten to twenty minutes. The second hearing, if you have to go, is also at 170 N. High Street, but on the fifth floor in a Courtroom indicated on your notice.
What debts have to be paid 100% under Chapter 13?
Most taxes and student loans; mortgage arrearages, child and spousal support, fines and penalties; Non Sufficient Funds (NSF) checks, some cosigned debts, any debt obtained under false pretenses, criminal debts and personal injury caused by driving while under the influence of drugs or alcohol.
When will my plan payments be deducted from my paycheck?
Approximately three months after filing the petition. Until that time you are responsible for making the plan payments directly to the Trustee.
If you are not sure that you want to file bankruptcy, contact my office for a free consultation to help you arrive at a decision.