How to Handle Bankruptcy

Keeping afloat if you have filed Chapter 13 bankruptcy

For some filing bankruptcy is the ultimate release and for some the ultimate failure. For, bankruptcy has a huge negative impact on your credit. It is going to take time for you to re-build the credit, so that you can obtain a new one soon. However, bankruptcy is not the end of the world. If you learn from your mistakes you will be able to survive bankruptcy and come out of it as a financially responsible person. This can happen irrespective of the Chapter under which you are filing – Chapter 7 or 11 or Chapter 13 bankruptcy or 12.

How can you survive through Chapter 13?
In order to survive a Chapter 13 bankruptcy program, you will be required to:

A.    Start collecting the details of the program – Start collecting the details of the program under which you are going to file. You will have to consider the effect of bankruptcy. You will have to find out as to how Chapter 13 is going to help with elimination of the debts. You should also try to understand the difference between Chapter 13 and Chapter 7 bankruptcy programs.

B.    Find out about the payment plan prior to filing – You need to find out about the payment plan to be followed, after you file bankruptcy under Chapter 13. When you file bankruptcy and the court decrees the plan, it becomes a legal issue. So, you will have to follow the same in order to become free of the debts as soon as possible.

C.    Start following a stringent budgeting plan – As Chapter 13 is about repayment and is known as the re-organization plan, you need to follow a budget. This is going to prove to be helpful for your finances and the payments to be made as per the re-organization plan. Through budgeting, you will get to save some money which can then be used towards the payments. If required, you can also try making some extra money which may bring in some extra dollars.

D.    Plan how you are going to re-build your credit – You need to plan as to how you are going to re-build your credit. If you can plan from the beginning, it is going to help you in following the right path to freedom from bad credit. For, when you file bankruptcy it gets listed on your credit report, this again has a negative effect on your credit score.

E.    Take expert help and advice before filing – Bankruptcy is a complex process and if you are planning to file one, it’s important for you to be aware of the legal basics. Therefore, it would be better to get the help of an expert who has better knowledge regarding the same. An expert can guide you through the process. The best person to get the help or advice from is an experienced bankruptcy attorney.

So, this is how you can go on to do away with your debts if you are going to file Chapter 13 bankruptcy and yet can come out as the winner.

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