How to File Chapter 13 Bankruptcy in New Mexico

If you owe a large sum of money to a lot of different creditors, you might be feeling a little anxious. But, even though debt can be very scary, there are tools you can use to better manage and take care of your debt.

Out of all the debt relief options available to you, Chapter 13 bankruptcy may be one of the most powerful. By filing for Chapter 13 bankruptcy, you can give yourself more time to pay off your debts, while also having some of your debts relieved. Read the guide below to learn all about how to file for Chapter 13 bankruptcy in New Mexico.

If you are thinking of filing for Chapter 13 bankruptcy or you have questions about the bankruptcy process, you can schedule a free consultation with our attorney at  Gilchrist Law Firm, P.C., by filling out our contact form or calling 505-999-1962.

What Is Chapter 13 Bankruptcy?

Chapter 13 bankruptcy allows you to develop a plan to repay all or part of your debts. Here’s how it works: You reorganize your finances to repay creditors within a period of three to five years by using your regular income.

However, as you might have guessed, Chapter 13 bankruptcy is only available to those who make enough money to repay their debts either in part or in full.

If you had six months to pay off your debt, you will have far longer under your repayment plan. This protects your assets, preventing them — including the assets you owe money on — from being taken from you or used to pay off your other debts.

By the time your Chapter 13 bankruptcy period comes to an end, and you’ve satisfied the terms of your repayment plan, the court may be able to relieve you of your remaining debt. This means you may pay less than you owe.

Who Qualifies for Chapter 13 Bankruptcy?

According to the official website of the Administrative Office of the U.S. Courts, to qualify for Chapter 13 bankruptcy, you must:

1. Have a sufficient amount of disposable income on hand, through your regular wages and other money earned. Disposable income is the amount that you have left after deducting allowed living expenses, secured and priority debt payments, and other mandatory payments.This money is used to pay off your debts.
2. Have filed all required tax returns for tax periods ending within four years of your bankruptcy filing.
3. Owe less than $1,395,875 in secured debts and $465,275 in unsecured debts.
4. Be willing to complete a credit counseling course and, when your Chapter 13 bankruptcy period comes to an end, a financial management course. Both must be given by a government-approved provider.

If you satisfy the terms outlined above, then you may qualify for Chapter 13 bankruptcy.

On the other hand, you might not qualify for Chapter 13 bankruptcy if you, within 180 days of filing for Chapter 13 bankruptcy:

1. Had a prior bankruptcy petition dismissed due to your willful failure to appear in court.
2. Had a prior bankruptcy petition dismissed due to your violation of a court order related to that bankruptcy.
3. Had a prior bankruptcy petition voluntarily dismissed after your creditors went to the bankruptcy court to recover the property they owe.

Exceptions to the above exist. But, as a general rule, if anything of the above has occurred, you are unlikely to qualify for Chapter 13 bankruptcy at this time. Not sure if you qualify? Talk to our Chapter 13 bankruptcy attorney at Gilchrist Law Firm, P.C., to discuss your particular situation.

How Can You File for Chapter 13 Bankruptcy?

To file for Chapter 13 bankruptcy, you must do the following:

1. Complete a credit counseling course, offered by a government-approved provider, within 180 days of filing for Chapter 13 bankruptcy. You cannot file for Chapter 13 bankruptcy if you have not done this.
2. Speak with a Chapter 13 bankruptcy lawyer who can help you. This isn’t always necessary, but the bankruptcy process can be complex, and working with a lawyer often makes things much easier.
3. File a Chapter 13 bankruptcy petition with your local bankruptcy court. To do so, you must provide your tax returns, documentation regarding your assets/debts, as well as anything else relevant to your case.
4. Right before you can file your Chapter 13 bankruptcy petition, you must pay a filing fee of $313. If you do not have the ability to do so, you may be able to pay the fee in installments or, in certain cases, have it waived altogether.
5. Develop a repayment plan—this is often wise to do with a lawyer, who knows which types of plans are more likely to be approved—and, then, file it.
6. Meet with the trustee who has been appointed to your case. This is the person who evaluates your case and  disperses the money you give them to your creditors. You won’t pay your creditors directly, just the trustee.
7. Go to a meeting with your creditors. Your trustee will be there and they will put you under oath. By doing so, they—and your creditors—will assess your case and your repayment plan.
8. Within 45 days of the meeting, you will have a confirmation hearing. At this hearing, you will learn if your petition for bankruptcy has been approved/denied.
9. Take a financial management course that is offered by a provider approved by the U.S. Department of Justice. After you complete your repayment plan, you cannot have your debts discharged until you complete the course.
10. Satisfy the terms of your repayment plan—the installments you agreed to pay over a period of several years—and, upon doing so, have the remainder of your eligible debts discharged.

By following the above-mentioned steps, you can file for Chapter 13 bankruptcy and satisfy the terms of your plan.

Considering Chapter 13 Bankruptcy? Talk to a New Mexico Chapter 13 Bankruptcy Attorney Today

Facing a large amount of debt can be an overwhelming experience. Chapter 13 bankruptcy could help you deal with that debt and get your financial situation under control.

If you want to learn more about filing for Chapter 13 bankruptcy, you can contact Gilchrist Law Firm, P.C., to speNew Mexico Chapter 13 bankruptcy lawyers by filling out our contact form. Or, you can call us at 505-999-1962.

We offer a free consultation that will help you determine whether or not Chapter 13 bankruptcy is right for you.