Filing Chapter 13 Bankruptcy

Chapter 13 type of bankruptcy is a reorganization or a repayment plan of debts usually provided by credit counseling agencies. It is required by the new bankruptcy law that a person who wishes to file bankruptcy must attend credit counseling session, a documentation of proven attendance of services provided by a credit counseling agencies. With the new bankruptcy law under BAPCPA effective last October 2005, people filing bankruptcy chapter 13 has increased. The new bankruptcy law indirectly encourages people to file this type of bankruptcy.

In order to qualify for a chapter 13 type of bankruptcy, a consumer must have a steady income that when minus all expenses, it still leaves an amount that can pay his debts for an agreed period of time. Filing Chapter 13 bankruptcy has advantages over a chapter 7 type of bankruptcy. It can save the home of a person that is set up for foreclosure. It also gives the debtor chance to reschedule secured debts. The disadvantage of filing bankruptcy chapter 13 is that its record will stay in your credit report up to ten years. This will make it hard for you to obtain a new credit without the permission of the court. Other creditors and lenders will also not risk lending money to people who has a huge red flag on their report credit.

How do you file chapter 13 bankruptcy? The way to file chapter 13 type of bankruptcy is to go first to a credit counseling agency. You have to attend their credit counseling sessions and ask for a documentation of your attendance from them to complete a requirement on the new bankruptcy law. Most likely they will provide you a repayment plan that you will use to propose to your creditors, usually it is in the time period of three to five years.

To be able to do all of this you have to make a bankruptcy petition, and you will need to hire at least a petition preparer if not a bankruptcy lawyer if you do not want to do all the work by yourself. This can really save you some time because petition preparer's main job is to provide information on all your bankruptcy documents which can take you more of your time if you will do it on your own. Make sure you hire a petition preparer or a Denver bankruptcy lawyer that follows the legal rules. One thing you should note is that petition preparers are not authorized to give you legal advice. Hiring a bankruptcy lawyer might be the most effective solution to ensure you file chapter 13 correctly.

If you have some questions regarding filing chapter 13, then you will need to hire a good bankruptcy lawyer. If you want to save some money you can hire a bankruptcy lawyer to just prepare your papers and pay their flat fee, then do the rest all by yourself. If money is no problem in hiring a bankruptcy lawyer then this can be easy for you, you can let the bankruptcy lawyers do all the work.

In order to file for a chapter 13 type of bankruptcy affordably, you can just hire a petition preparer to prepare your papers. Then you can pay him the flat fee and you can start doing the rest of the bankruptcy process.