When you file for Chapter 13 bankruptcy, you may wonder what steps come next in the process. 

After filing for this type of bankruptcy, you need to acquire a reorganization plan, which allows you to restructure your debt. 

Learning about it 

According to FindLaw, a repayment plan is a major difference between Chapter 7 and Chapter 13 types of bankruptcy. In addition, having a steady income is a prerequisite for Chapter 13 planning. 

After calculating your median monthly income, it is typical to prepare for a five year repayment plan. The only exception is if your median income is less than the state’s median income. Then, you will usually have a three year-long plan instead. 

Avoiding repayment issues 

Due to the differences in the structure, Chapter 13 repayment plans rely on you having a regular job or source of income in order to complete this process. If you fail to make the payments in time, it could be financially risky to agree to this plan. 

However, there are exceptions for outstanding circumstances, such as serious injuries that force you to stay in the hospital for a long length of time. In that case, you should appeal to a judge, who can either discharge your debts or help you change your plan. 

Completing it   

Near the end of this process, you must appear in front of a judge and showcase how current you are on completing off your necessary payments. If you get approved, then from there you finish a budget counseling course. Soon after that, you officially can complete Chapter 13 bankruptcy.