Drafting a Chapter 13 Repayment Plan

Chapter 13 bankruptcy is a restructuring bankruptcy, one in which you use a portion of your income to pay off your debts over a set period of time. Unlike other forms of bankruptcy (such as Chapter 7), in which property is liquidated and the profits used to pay off debts, restructuring bankruptcy protection allows you to keep the majority of your possessions. As long as you keep making your payments in accordance with your agreement, you will be able to keep your property.

The key to any Chapter 13 filing is the repayment plan that you make for it. The terms of this plan will determine how successful you will be at overcoming your debt. Because of the complexity of the plan and how important it is to you, your family, and your future, it is vital to know that you’ve crafted an arrangement that is both aggressive enough to ensure that you get out of debt on time, but realistic enough that you are able to consistently make the payments.

Because of how much is resting on the repayment document, it’s important that you know you have a document you can rely on. To this end, it may be very beneficial to discuss your situation with a qualified, experienced bankruptcy attorney.

With that in mind, the following tips may be able to help you and your family get out of debt on time and with a minimum of problems:

· Set realistic goals. The consequences to failing to meet your payments can be severe, and should be avoided at all costs. While you may initially think that setting a very aggressive repayment plan will help you get out of debt faster, it won’t help you at all if you can’t keep to it.

· But be responsible. Don’t lowball your proposal to the point that the courts will not accept your proposal. It’s important to make sure that you draft a plan that can repay your debts in a reasonable time period.

· Discuss your case with a lawyer. An experienced bankruptcy attorney can help work with you to make sure your needs are met and that your repayment proposal will be accepted by the courts.


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