The answer to this query may depend on several factors, such as the type of bankruptcy for which you qualify and intend to file. Chapter 7 and Chapter 13 are the two most common forms of bankruptcy. Chapter 7 is more difficult to obtain approval for because it is a direct asset liquidation with strict regulations and requirements. The majority of individuals filing for bankruptcy will be required to file Chapter 13, along with a two-page petition and filing fee.
The filing itself will be the initial action, followed immediately by the request to creditors to cease collection efforts. They may no longer demand payment from you for delinquent debts, nor may they sue you or repossess your property. You will submit this petition to the court, along with the names and addresses of all of your creditors, within a few days of filing for Chapter 13 bankruptcy.
One week after submitting your list of creditors, you must provide the court with documentation of your assets, income, expenses, financial plan for the reorganization of your finances under Chapter 13, and evidence that you can adhere to the plan.
Next, you will finalize your financial plan with your trustees. This meeting will occur between one and three months after your initial Chapter 13 filing and will last no longer than ten minutes. You will likely be required to swear to tell the truth, followed by answering queries that will be recorded. Your creditors will be able to inquire about your financial strategy. Very infrequently do creditors actually attend these appointments. The repayment plan commences following this meeting.
The creditors have until the 60th day after the creditor meeting to file litigation contesting your intent to discharge a debt.
In Chapter 13 bankruptcy, the duration of your repayment plan will depend on the amount you owe and your monthly income. Even if you are able to pay off your debts in less than 36 months, Dallas's bankruptcy laws stipulate that all repayment arrangements must last between 36 and 60 months.
Once your Chapter 13 bankruptcy has been discharged, it will remain on your credit report for up to ten years. Consider this before filing, particularly if you intend to purchase a home or vehicle in the near future or are seeking a new position. During a background check, creditors and employers typically dislike discovering a bankruptcy. Take the time to explain your circumstance to a prospective employer if declaring bankruptcy is unavoidable.
When filing for bankruptcy becomes inevitable, you must be prepared with copious documentation, a long-term repayment plan, and forbearance.
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