Bankruptcy plans may not succeed when people fail to plan their finances in advance. Debtors in Michigan have a number of options to repay their debts, but they must prepare for a Chapter 13 plan correctly. The following are several steps that they are recommended to do.
Review bankruptcy laws in Michigan
Filing for Chapter 13 bankruptcy in Michigan is handled under federal law and carried out in a federal court. The type of information that you need includes documentation to prove your income, including tax returns and bills, as well as credit reports that provide a list of the creditors you owe.
Prepare for the process
The process of filing for bankruptcy is similar for nearly all debtors. You can keep many of your assets and properties, but you must create a repayment plan that is approved by the court. You’re allowed to choose an affordable monthly payment along with a repayment period that lasts for three to five years.
When you select a repayment period, you have to commit to it based on your potential income. The courts do allow some leniency, but you must wait two years to file for a second bankruptcy. You also have to decide which exemptions to claim, such as child support, alimony and Social Security benefits.
Planning is the key to your financial success
Even after you file for Chapter 13 bankruptcy, your assets are not entirely secured. Your income and repayment amounts could fluctuate throughout the duration of the plan. It is your duty to protect your finances legally and prepare a case ]in advance of filing.