4 Tips to Find Success with Your Chapter 13 Bankruptcy Filing
There are many reasons to consider Chapter 13 bankruptcy, including the fact that it lets you control your own income, keep assets, and discharge more of your debt than the other types of bankruptcy. However, all too often debtors fail to get to the end of the process.
One of the main reasons this happens is because the debtor writes their own payment plan. This is actually an advantage – but only if the plan is written correctly. The best bet is to work with a California bankruptcy attorney who can help you create a plan. Call California Bankruptcy Relief at (888) 748-0025 now to get a free consultation. In the meantime, read on for four tips to have success with your Chapter 13 filing.
- Do not overreach
- Be honest about your cost of living
- Take advantage of automatic payments
- Work with an experienced attorney
The most common reason that a Chapter 13 bankruptcy fails is because the debtor creates a plan that is more ambitious than they can handle. This is often the result of having a home that is very far in arrears, or a vehicle that has a very large unpaid balance. Though it can be a hard and emotional process, it is often the case that the most valuable thing a bankruptcy offers is the ability to walk away from debts that are simply unreasonable in your current financial situation.
In a Chapter 13 bankruptcy filing, you must present a budget for your life and that budget must be realistic. Too often, debtors will either over or understate their expense. For example, we’ve seen families of four say that they can live on $200 for food. This is unreasonable in California.
The bad news is that if you base your living expenses on unreasonable numbers, then the plan is only going to work on paper. In reality, you will just be putting off the inevitable. Make sure that the numbers you designated are reasonable and that you are taking all your costs into consideration.
We generally advise that your Chapter 13 payments get automatically paid, whether directly out of your pay check or your bank account. The bottom line is that if the money is gone immediately, then you will have a much better idea of what you really have left to handle your ongoing expenses.
You will need your bankruptcy attorney from the beginning through the end. If you come up to issues, call your lawyer and tell them about it. Be proactive and be honest. Whatever obstacle you are facing, it is unlikely that your attorney has not seen it before. It is likely that there are solutions you have not considered.
If you are ready to find out if bankruptcy is right for you, please contact California Bankruptcy Relief at (888) 748-0025 for a free bankruptcy consultation.