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You have obligations when you file for bankruptcy

Don't assume that filing for bankruptcy is an easy way to handle debts. When people file for bankruptcy, they have to take the time to learn what obligations they have. A person who files for Chapter 13 bankruptcy has very specific responsibilities.

Before you file for bankruptcy, you will have to go through credit counseling and provide the certificate of completion. If you were provided with a repayment plan during the counseling, that must be handed over to the court. You will also have to pay a fee to file, but you might qualify for an installment plan to handle this if you can't pay it all at once.

Chapter 13 bankruptcy is often referred to as a wage earner's bankruptcy because it requires the person to make regular payments to the bankruptcy trustee. All of these payments must be made on time and in the amount required.

The payment schedule and amount are based on a few factors. One of these is when you get paid. Another is how much money you have left after paying necessary bills. Once the court knows how much you can pay and how often, it will set the plan.

All debts included in a bankruptcy are categorized. There are priority debts, secured debts, and unsecured debts. Priority debts must be paid in full by the end of your bankruptcy. Secured debts have to remain current during the bankruptcy case. Unsecured debts are handled so that the amount paid is equal to you nonexempt property.

Make sure you understand what you have to do before you file. Once you decide to file, you have to ensure you are complying with the responsibilities you have.

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