If you are at the point where you are considering filing for bankruptcy, you have likely found yourself in a significant amount of debt that you believe you cannot overcome without help. The good news is that bankruptcy may offer a way out, irrespective of your financial situation.
Those with a steady and dependable income may find that filing for Chapter 13 bankruptcy is the best choice for them. Chapter 13 bankruptcy involves the pausing of all creditor action, meaning that debtors can reorganize their debts and use their disposable income to repay them over time without having to worry about additional fines.
The repayment plan is designed to be realistic and attainable since it is based on your disposable income. However, completing Chapter 13 bankruptcy does require that you are motivated and disciplined. The following are some tips for successfully completing Chapter 13 bankruptcy.
Remember that it’s a marathon, not a sprint
Completing a Chapter 13 bankruptcy will take between three and five years. Some bankruptcy filers can be extremely motivated for the first few months and then start to lose discipline because they have been too strict on themselves. You must be committed in the long term, so it’s important to budget accordingly. For example, you may want to try to put some money aside each week to save for occasional treats, such as a family meal, to keep your motivation strong.
Take action as soon as circumstances change
Your repayment plan is based on your income as it was at the start of the bankruptcy filing. However, if you suffer an unexpected illness or lose your job, it may be impossible for you to keep up with payments. Take action to modify your bankruptcy arrangements. In certain situations, it can be possible to suspend or modify your payment plan, extend the length of your plan or gain permission to incur a new debt such as a loan against property.
Chapter 13 bankruptcy is challenging, but when completed it will allow you to enjoy a debt-free life without the financial stresses associated with unpaid debts. Make sure you have a good overview of all options before filing for Chapter 13 bankruptcy.