If You File Chapter 13 Bankruptcy in Georgia Will You Need To Make Payments?
Establishing a payment plan is the main difference between
filing chapter 13 bankruptcy and filing chapter 7 bankruptcy. Your payment plan
must be submitted either with the initial bankruptcy filing or within 15 days
later.
Your payment plan must meet court approval, and it must
include fixed-amount payments to the plan trustee. These payments must be set
for a regular schedule.
Your payment plan will treat different creditors in
different ways. In Chapter 13 bankruptcy, there are 3 primary types of
creditors.
Priority. These
are the creditors whose claims generally must be paid in full, or they may
agree to a lower amount (such as recent tax debt and child support payments).
Secured. These
are creditors who have secured the right to take certain property from you if
you do not pay. If you want to keep your property, you must pay these creditors
(such as mortgage arrears or car payments).
Unsecured. One common example of a unsecured lender is a
credit card company. Under Chapter 13, many people qualify not to have to pay
these creditors at all.
When the plan is approved by the court, its terms are
binding to you and your creditors alike. You will need to make the regular payments to the trustee
either directly or through payroll deductions. Payroll deductions can be a good
idea due to the likelihood that the payments will be made on time and in
sufficient amounts.
Once your plan is approved, make your scheduled payments. If
you think you are going to miss a payment, be sure to inform your attorney.
Failure to do so may lead to dismissal of the bankruptcy protection. Bankruptcy
on your own can be difficult; we can help.
Call King and King bankruptcy
attorneys for a free consultation today 404-524-6400 or visit us at kingandkingattorneys.com
