Be sure to comply with requirements in Wilmington Chapter 13
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Filing Wilmington Chapter 13 bankruptcy can help you get control of your debt, stop a foreclosure on your home, repossession of your auto, and other dire consequences that can come with delinquent debt. Fortunately, bankruptcy is a legal solution that offers a fresh financial start for struggling consumers. Chapter 13 can get you back on track, but in exchange for the benefits offered, you must meet certain requirements.
#1 Be Transparent With Your Lawyer, Update the Court
Throughout your Wilmington bankruptcy process, it’s mandatory that you operate transparently. From the very first appointment with your attorney, you must be honest and forthcoming about your financial situation including your income, bills, assets, all debt, and living expenses. You’re not permitted to conceal income, inflate expenses, or try and keep some of your debt out of the bankruptcy process.
Legally, all of these are part of your bankruptcy case, and your attorney needs complete information to serve you best. Plus, if you lie to the court, you can end up in hot water accused of bankruptcy fraud. Also, if anything changes, you’re required to notify your attorney, and they will let the court know if it’s something that needs to be brought to the attention of the Trustee and judge on your case.
#2 File Taxes And Court Documents
During your Wilmington bankruptcy, you’ll be required to submit documents including income tax returns, wage reports, and other documents requested by the court. Each year, you must submit an updated statement of earnings and expenses, and you are required to file your income tax returns on time as well.
But that’s not all, the Chapter 13 Trustee will need to see your last four years of tax returns in most cases, too. You also must submit your credit counseling certificates – there are two courses to complete. Plus, you must submit any info on changes in assets or income including a pay raise or inheritance. You may also be asked to submit receipts to prove your expenses.
#3 Make Your Payments on Time Every Month
Most importantly, throughout the three to five years of your Wilmington bankruptcy, you must make your required payments on time each month. Your repayment plan must be designed to catch up all delinquent balances on secured and priority debt over the duration. This includes your mortgage, auto loan, child support, alimony, some tax debts, etc.
You should pay a lesser percentage of unsecured debts including credit cards, medical bills, and personal loans. If you ever miss a payment, you must make it up ASAP or you risk your bankruptcy being tossed out of the court. However, if it turns out you can’t afford your repayment plan, you might be able to convert your case to Chapter 7 bankruptcy for faster and greater debt relief.
#4 Don’t Get Into Additional Debt
While in your Chapter 13 repayment plan, you are not allowed to add any debt to your life without the court’s permission. That means no opening credit cards, consumer accounts like store cards, and you can’t even borrow at places that don’t require a credit check such as a payday loan (which are illegal in our state anyway) or a buy-here pay-here car lot or furniture store.
In rare cases, you might be approved for an exception. For instance, if you need a credit card for travel for your job or your car dies, and you must finance a replacement, you might be granted an exception, but the court must approve the request before you can take on additional debt during the Chapter 13. As a rule, though, it’s not allowed.
#5 Don’t Pay Debts Outside of the Case
Another critical thing to know is that you cannot exclude debt from your Wilmington bankruptcy case and you can’t pay any debt outside the case. For instance, if you owe $2000 to your dad, that’s part of your bankruptcy case because it’s a personal liability. The court doesn’t care that it’s your parent. If you pay your dad the money you owe, the court can come after it.
The bankruptcy court can force a creditor, in this example your parent, to turn the money over to them or face trouble. Everything must run through the court. In the case of dad, finish your bankruptcy and then pay him back later – or risk having your bankruptcy plan tossed out of court and your debt piling up on you again.
To find out more about the benefits of Chapter 13 bankruptcy, contact the Law Offices of John T. Orcutt. Call +1-919-646-2654 now for a free Wilmington bankruptcy consultation at one of our convenient locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington.