Saturday, April 28, 2012

Myths About Chapter 13 Bankruptcy

Among the many myths associated with Bankruptcy, we see these two repeatedly so let's clear things up a bit. 

1.  Myth:  When a debtor is in a Chapter 13 bankruptcy, the Trustee will check monthly bank statements and check every expenditure a debtor makes for the life of the Chapter 13 Plan.
Truth: When a bankruptcy is filed, the debtor discloses under penalty of perjury their income and expenses. The Trustee understands the income and expenditures as an average and assumes it stays the same until either the end of the bankruptcy or until an amendment is made. The Trustee will not require bank statements each month to verify this information.

2.  Myth:  When a debtor is in a Chapter 13 bankruptcy and they need a different vehicle, they will not be able to purchase another vehicle while in the Chapter 13 Plan.
Truth: A Chapter 13 bankruptcy is three to five years in length. In that period of time many things can happen to someones car, the Court understands this. It is possible to obtain a new or different vehicle, your attorney needs to file a Motion with the court to Incur New Debt. Once the judge approves the motion you can move forward with the issue.

If you want more details on these or any other bankruptcy questions feel free to submit your question(s) via email or call  877-776-4LAW (4529) to speak directly with one of our Bankruptcy Attorneys.

Read original article here.

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