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You Need to Make Your Chapter 13 Bankruptcy Payments


Bankruptcy is something that absolutely has to be taken seriously, and that means making those payments on time, every time. Chapter 13 bankruptcy is often thought of as the "best" choice because you don't always lose assets. Instead, you pay the money you owe off over time. It's true that this is best for many people, which is why making the payments is so important.

If you miss your payments, it's possible for the filing to be dismissed. This means that you still owe everything that you originally owed. You are no better off than when you began, and your financial situation can be a mess.

Another possibility, if the case isn't dismissed, is that it will be altered so that it is a Chapter 7 filing instead. You don't have to make payments. However, your assets will be liquidated to pay off what you owe. This could cause you to lose a lot of what you thought you'd protected by choosing Chapter 13 bankruptcy in the first place.

If you're a business owner, this is also a huge issue because you may need your assets so that your business can keep going. If you lose all of what you bought with the loan -- such as machines, parts, materials and the like --then that's it for your company. The debt is gone, but so is your income and your dream.

As you can see, bankruptcy can help when used properly, but it must be handled properly. Be sure that you know exactly what your bankruptcy filing means, what is asked of you and what you have to do going forward.

Source: Huffington Post, "Seven Terrifying Things They Don't Tell You About Bankruptcy," Brian Reed, accessed Sep. 24, 2015