There
are a number of ways that an individual or business can declare
bankruptcy, these methods are commonly called “Chapters.” Filing
for Chapter 13 bankruptcy in Utah is a form of debt relief that
allows the petitioner to put forward to the court a plan to
reorganize his or her debt. It is normal practice for the petitioner
to engage the services of a competent bankruptcy attorney whose task
is to demonstrate that the petitioner is capable of repaying most of
the accumulated debt and that this is the preferred option for all
involved.
Chapter13 bankruptcy is for people who have significant assets that theywish to keep; assets such as their home, other
property, art, vehicles, collectables, etc. Filing for Chapter 13
bankruptcy will allow them to keep their assets intact; they will not
be seized and disposed of at auction. For those who have very few
assets the preferred choice is Chapter 7, they have really nothing to
lose so having the debt discharged quickly is the favored option.
Under
the rules that apply to Chapter 13, the petitioner is obliged to
visit the court before actually filing. This visit will give the
petitioner and his or her attorney an opportunity to disclose any and
all information as it pertains to debt and assets. The court will
expect the petitioner to provide a detailed list of monthly
expenditures including repayment of secured debt such as a vehicle or
property. Anyone that files for Chapter 13 bankruptcy in Utah must
prove that they have a steady income which exceeds the total amount
of secured debt and living expenses, the balance in the eyes of the
court is available to pay the unsecured debt, some of which is
priority, other is not. Priority debt for example is past due child
support, back taxes and any debt that is payable to their current
employees where they have a personal liability. Unsecured debt that
is not considered to be a priority are credit card bills and medical
bills; if the reorganization plan is accepted by the court
administrator some unsecured debt may be forgiven.
Once
the petition for Chapter 13 has been presented to the court and
accepted these actions in themselves are enough to end all creditor
actions that are designed to collect the outstanding debt. Upon
filing Chapter 13 all creditors must cease any form of harassment and
they are not allowed to sue you.
When
everything has been settled, the reorganization plan is complete and
the repayment schedule agreed upon all payments to creditors are
taken out of your hands, you pay the agreed upon amount to the court
appointed administrator who in turn makes the payments to the
creditors on your behalf. Making your payment to the administrator in
accordance with the plan is imperative otherwise you may lose certain
privileges such as the discharge of certain debts once the plan is
completed.
