When a debtor files Chapter 13 bankruptcy he/she is required to repay all or a portion of his/her debt over the course of 3 to 5 years.
While in Chapter 13 bankruptcy, a debtor is prohibited from taking actions such as:
- Selling or "getting rid of" property without the approval of the bankruptcy court. For example, if a Chapter 13 bankruptcy debtor owns an old car and decides that he/she wants to give it away to charity, he/she would need the permission of the bankruptcy court. Another, more common example would be if the Chapter 13 bankruptcy debtor wanted to sell his/her home. In order to sell a home while in Chapter 13 bankruptcy, the debtor would need to get the bankruptcy court's approval.
- Accruing more debt without about bankruptcy court approval. A debtor in Chapter 13 bankruptcy is not allowed to borrow more money unless he/she gets the approval of the bankruptcy court. For example, if the debtor wanted to give away that old car and buy a new one, the bankruptcy court would need to grant the debtor permission before they could proceed.
If a debtor mistakenly takes an action without permission of the bankruptcy court, sometimes the bankruptcy attorney can help the debtor get the court approval even after the fact. For more information about the rules of Chapter 13 bankruptcy, contact a Dallas-Fort Worth Bankruptcy attorney today.