A Chapter 13 reorganization can be your fresh financial start, so make sure to avoid things that might cause the plan to fail. If you use Chapter 13 bankruptcy the right way, you'll end up with a repayment plan that will be easy to manage, and you'll be freed from struggling month to month.
Below are four of the main reasons that Chapter 13 bankruptcies fail:
- You don't keep your attorney in the loop. Things do pop up during the bankruptcy process, and a good attorney will know how to deal with unexpected events. Don't try to hide anything from your attorney, or it could come back to bite you. Remember that your attorney is on your side, and your Chapter 13 will run smoothly.
- The debtor can't learn to live on a budget. If you find yourself unable to live on a budget, you might need help. Your attorney can put you in contact with the right resources to help you with your financial troubles. These resources will help you learn how to manage your finances properly.
- The plan is setup poorly and doomed from the start. Make sure you use a good attorney, and they will set you up on a plan that you can easily manage. This also relates to being honest with your attorney. Make sure your attorney knows everything about your financial situation, so that they can evaluate if a Chapter 13 plan will work for you.
- Unplanned for expenses come up. Sometimes even the best laid out plans go awry. You shouldn't be on a repayment plan that stretches you super thin, so you should be able to build a small amount of savings. But, if something pops up that is unmanageable, you need to make sure your attorney knows about it. They'll be able to figure out what you need to do next.
Well, the key thing here is to make sure you pick a good attorney, and keep them informed. Chapter 13 bankruptcy is a great option for many people, and you'll end up with a fresh financial start when it is all through. If you would like to find out more about the bankruptcy process, contact a bankruptcy attorney. If you're a good candidate for bankruptcy, you'll have the weight of the world lifted off your shoulders, and you'll be back on your feet in practically no time.