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How Chapter 13 works

Citizens of New York who are researching different types of debt protection and bankruptcy filings may be considering filing under Chapter 13 of the Bankruptcy Code. This requires careful attention to detail and thorough reporting of all requested information, but the process is straightforward and can be accomplished with relatively few fees or levies.

The process begins by contacting the bankruptcy court that serves the section of New York where the petitioner lives. The bankruptcy court must be provided with full report of all assets and debts that the petitioner may possess as well as a schedule that shows current income and expenditures. They will also require a statement of any unexpired leases or executory contracts that may apply. In addition, a statement describing the petitioner’s financial situation, a certificate of credit counseling and a tax return from the most recent year must accompany the petition. Some other relevant documents must be provided so that the court will have a complete picture of the finances, income, expenditures and liabilities. They will also want to see information as to how the monthly economic picture may change if bankruptcy protection is obtained.

Married couples may choose to file separately or together. If only one spouse chooses to file, then that spouse will have to provide all relevant information for their other partner. Approximately $310 in fees must be paid for each filing, though the court may grant permission to pay them in installments. Any lapse in the payments on the fees may cause the case to be dismissed.

Filing for Chapter 13 may be easier with the assistance of an attorney. They might have relevant experience in assembling the necessary documentation, and they could be able to give perspective as to what information the court may need.

Source: United States Courts, “Individual Debt Adjustment“, October 03, 2014

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