Many people consider bankruptcy an intimidating process. You may also hold this idea, and while it certainly is a complex legal process to go through, you do not have to feel so intimidated that you choose not to consider it a debt relief option. If you earn a steady income and face substantial debt, you could qualify for Chapter 13 bankruptcy.
With Chapter 13, you work with a plan to pay back your creditors over the course of three to five years. However, not just any repayment plan will do. You must create a plan, present it to the court and have it approved. This part of the process is known as confirmation.
Timing for confirmation
After filing for Chapter 13 bankruptcy, you may feel ready to keep the ball rolling. However, many aspects of your case can change within the first couple of months of filing. Because of this potential, your confirmation hearing may not take place until approximately 60 days after your initial bankruptcy filing. You may think this time frame will allow you to second guess your decision and sit around feeling anxious, but you will have plenty to do during this time.
Additionally, your creditors still receive some payment until confirmation. These small amounts are known as "adequate protection."
Creating your proposal
As mentioned, you must create a repayment plan proposal that you will provide to the court. This part of the process may seem intimidating because you do not know the steps necessary for repaying creditors or what your plan should include. Fortunately, you can obtain legal assistance with this and all parts of your bankruptcy process, so you do not have to feel alone or lost.
When it comes to what to include in your plan, it will need the following information:
- Which creditors you plan to pay
- When you intend to pay those creditors
- The portion of original debt you intend to pay
If the court approves your proposal, you will receive a confirmation order. This order allows you to more fully move forward with bankruptcy and begin making the payments necessary to address your debt. As long as you stick to your plan, you should remain eligible for the discharge of applicable debts. While Chapter 13 bankruptcy may seem intimidating to begin, it may be the route that helps you regain your financial freedom.