what to expect from chapter 13 bankruptcy in OmahaSo, you’ve decided to file for bankruptcy. Congratulations! We’re sure that was a difficult decision, but we’re also happy you took your first step toward financial freedom.

With a Chapter 13 bankruptcy, most of your debt (minus things like student loans) will be wiped out by the court after you commit to paying disposable income to the court for 3-5 years. But there are several other things you should be on the lookout for after filing so that you’re not caught off guard.

After Filing for Chapter 13 Bankruptcy in Omaha: What to Expect

  • Your automatic payments for your home loan will be cancelled and your vehicle loan payment will be made through the bankruptcy.
    • A Chapter 13 bankruptcy will protect you with something called the “automatic stay,” which is a law that protects you from creditors attempting to collect debt from you.
    • The creditor will likely revoke permission to pay online and the automatic payments will likely be stopped before your next payment is due so your creditors can protect themselves from legal issues on their end. Take note of this (with your phone or planner) and set up a way to pay.
    • You can:
      • Make your payment by check.
      • Make your payment over the phone.
      • Sign up for monthly bill pay at the bank you have your checking account.
    • We realize this is an added inconvenience, but your creditor does this to avoid legal problems for themselves.
    • Set up this new method of payment as soon as possible so you don’t fall behind.

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  • Your payment for your home still needs to be paid, in full, on time, every month.
    • Confirm with the creditor to make sure the payment has been made each time.
    • Keep a paper trail (cancelled check, bank statement, etc.) of those payments.
    • Maintain adequate insurance on the house and be prepared to show proof of insurance to your creditor.  
       
  • Your first payment to the trustee will be due within 30 days of filing
    • If you agreed to pay by employer withholding, you will want to confirm that the money is being deducted from each paycheck
    • If you chose to pay individually each month, make sure that your check is in the mail with enough time to get to the Trustee’s office within 30 days of filing the bankruptcy.

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  • Your bank may want to speak with your Omaha bankruptcy attorney.
    • Because of the automatic stay, some creditors will require your attorney’s permission before they’ll talk to you about your loan.
    • If that happens, contact our office and we will give them permission to speak with you.
       
  • Your credit cards will be closed.
    • All your credit cards—even the ones with $0 balance—will be closed to prevent any additional losses to the credit card company.
       
  • Your lines of credit will be cancelled.
    • This is so the bank can protect itself from further losses.
       
  • You’ll still receive bills from your creditors—at least for a bit.
    • That doesn’t mean you have to pay them. Although creditors are prevented from trying to collect money from you once you file bankruptcy, you’ll probably still receive some bills in the mail for a while. The court sends out a notice to each of your creditors after you file, and it can take your creditors a few weeks to process the notice.
    • If you do get bills from creditors a month or more after filing, send them to our office so we can give them another notice.
       
  • If you come into a situation where you need to borrow money or have an issue, contact our Omaha bankruptcy lawyer immediately to review
    • If you anticipate any difficulties, don’t wait until the fire is raging to call me.  Please call me before the fire starts.
    • If you are needing to borrow money, contact our office to discuss if this will be possible and the process you will need to follow to get the court’s approval.

That might seem like a lot to think about, but taking this step toward financial freedom and security will ultimately take more stress off your mind and leave you with time to think about what really matters: your friends, your family, and your new future. Good luck!

Contact Our Omaha Bankruptcy Lawyer for a Free Consultation

If you have more questions or are wondering if filing a chapter 13 bankruptcy in Omaha is right for you, contact our bankruptcy lawyer online or call Steffens Law Office at (308) 872-8327 now!

William V. Steffens
Nebraska Personal Injury & Bankruptcy Attorney With 34+ Years Of Experience
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