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What should I expect during the Chapter 13 repayment period?

After our last few blog posts about Chapter 13 bankruptcy, we realize that some Wayne County readers may still have a few basic questions left unanswered. You know what Chapter 13 offers and you know about how your debts will be grouped and prioritized. But do you really know what to expect the first morning you wake up with your new repayment plan in effect? After all, this is your life we're talking about, and you deserve to have a clear picture of what the next few years will be like.

Let's try to answer your question with some general information from the United States Courts website, and note in advance that this should not be construed as specific legal advice. Let's say your proposed repayment plan has been approved by the court. Your payments need to begin "as soon as is practicable" -- there's no grace period or window within which to work up to those payments. This is something to which you and your attorney would have given careful thought as you drafted the repayment plan.

It's not necessarily going to be business as usual under Chapter 13. You will have to adjust to living on a fixed budget. The trustee will accept your payments via payroll deduction, if you wish to set it up that way. You'll have manageable payments under Chapter 13, true, but you won't be able to take on any additional debt unless you can get the trustee to approve it.

This may sound intimidating to some readers. What happens if you suffer serious injury or contract a debilitating disease? The law does allow for a hardship discharge in limited circumstances, although it's typically not as broad as you would receive if you completed the repayment plan.

Readers who are still considering this option may wish to follow up with a legal professional regarding their specific questions. It's important to give full consideration to the benefits as well as the potential challenges of Chapter 13 before making a decision.

Source: United States Courts, "Individual Debt Adjustment," accessed on Sept. 26, 2014

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    He helped me thru my 1st bankruptcy and now the second. I had no idea what to expect , but they kept me informed and answered all my questions. Mr. Schneider is the most experienced and knowledgeable lawyer I have ever met. If you have to file call this attorney first!

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