We cannot give legal advice
online, only legal information
, so I will address your concerns to the extent I can, but you will need to consult with an attorney in your jurisdiction for legal advice (i.e. I cannot answer "should I" but I can tell you some things to consider...)
I can say that generally, Chapter 13 is not helpful if it is filed too soon. Chapter 13 generally allows one to keep houses and cars on which payments are behind by curing the arrearage through the Chapter 13 Plan. The debtor in bankruptcy generally has to start paying the Chapter 13 Plan within 30 days after filing the bankruptcy case, and all payments that are behind BEFORE the case was filed can normally be cured so the house and cars are protected.
So, if you are unemployed and do not currently have sufficient income and you file Chapter 13, if your income is too low to make the Chapter 13 Plan payments plus mortgage payments going forward, then the case will get dismissed and you wasted a lot of money. Also, if you file Chapter 13, even if you can struggle along for awhile, if you cannot afford both the mortgage and the Chapter 13 Plan, then if the house gets behind AFTER the case is filed, the creditor will request permission to foreclose.
So... generally, it is ideal to wait until you have a new income source, then file Chapter 13 and catch up payments on the house through the Chapter 13 Plan plus you can normally pay car loans through the Plan as well, thus curing any arrearage on those too.
The catch, of course, is hoping you find a job with sufficient income to accomplish all these goals before the house is foreclosed and the car is repo'd. But, if you file before you can afford the reorganization, all you buy yourself is a couple of months and then the house will get foreclosed and the car will get repo'd anyway
, plus you're also out attorneys fees and a filing fee for the Chapter 13, if that makes sense.
Another way of saying this is that Chapter 13 will fix arrearage which occurred before the case was filed, but it will not normally fix anything that goes unpaid after the case is filed, so you normally want to be sure your income is stable and sufficient before filing the case.
Another consideration is the Means Test
. This is a test in which you list how much money your family made in the previous 6 months, and then after much ado, it determines the minimum amount your Chapter 13 Plan payments can be. It is more detailed than this, but I think that explanation suffices for your purposes. So, the ideal time to file (generally) is right AFTER you get a new job, because at that point you can afford the Chapter 13, and your previous 6 months income is as low as possible, thus mandating a lower payment.
All of these timing issues are things you should discuss with your attorney to see what works out best for your specific circumstances.
If you have any more questions, or if something I said doesn't make sense, please let me know!
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