How to Avoid Chapter 13 Bankruptcy
- 1). Create a spreadsheet of all monthly expenses. Many people who end up filing for bankruptcy really have no idea what they are paying for all of their monthly bills. Include credit card payments (also list the credit card balances and interest rates), utility bills, cable/Internet/cell phone bills, food, personal care and entertainment expenses.
- 2). Using your spreadsheet, determine whether your monthly expenses exceed your monthly income. List all income sources (after tax) and determine whether your expenses are more than your monthly income. If so, look to see where you can cut back on monthly expenses. Premium cable packages and unlimited cell phone plans can usually easily be cut back to basic plans to save money.
- 3). Visit a credit counseling agency to create a plan to take care of your debt. Find a credit counseling agency that is a member of the National Foundation for Credit Counseling. They can help you avoid Chapter 13 bankruptcy by working with you to create a repayment plan for your debts.
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