In order to prepare to file a chapter 13 bankruptcy, the debtor must begin by gathering together several documents. These items will be presented with the filing of the petition.
Starting with the schedule of assets and liabilities, the debtor must completely and accurately list all debts and assets to establish an overall financial picture. Then, along the same lines, the individual�s income and expenses need to be listed for the court to examine the monthly comings and goings of cash flow. The household income is taken into account and reported to the court as part of determining the payback plan.
A third requirement with the filing is the schedule of current leases and contracts. A statement of financial affairs is also required and needs to describe any potential increases in income and any interest the debtor has in education or tuition accounts. Finally, proof of income, payments from employers, and the most recent tax return (as well as verification the last four years have been filed) will be required as well.
As part of the chapter 13 process, the debtor must go through an approved approximately one hour credit counseling session, providing evidence of successfully completing it to the court. Fees must also be paid at the time of filing. The court filing fee is currently $281. Usually attorneys require a portion of the legal fee to be paid up front also.
Once the chapter 13 is filed, the court assigns an impartial trustee to oversee the case. The trustee is responsible for evaluating the financial picture of the petitioning debtor, reviewing assets, and disbursing payments to the creditors. For more information, see part 2.