Texas bankruptcy can be a complicated concept to wrap your head around. No matter your financial situation, there is undoubtedly a tangle of circumstances totally unique to your situation that make things complicated. However, there are a few common bankruptcy myths that seem to be more or less universal in discussing Chapter 13 bankruptcy. Here we address one of the biggest ones.
Chapter 13 & Expenditures
A common bankruptcy myth surrounds the Chapter 13 repayment plan in bankruptcy. Many people are under the impression that their finances will be under close scrutiny for the entire term of their Chapter 13 Texas bankruptcy repayment plan, that their bank statements will be checked, that all expenditures will be vetted. In fact, the bankruptcy trustee checks your bank statements and finances at the time of the Chapter 13 filing, and extrapolates out assuming an average income consistent with the numbers at the time of filing. In other words, this bankruptcy myth is totally ungrounded. Your bank statements will not be checked at all, and the responsibility for making your repayment amount under bankruptcy law is entirely on your shoulders. This can be liberating, but it is also puts all the responsibility squarely on your shoulders. No one is making sure you are being responsible with your money except yourself.
Perhaps this bankruptcy myth pervades in order to give people an added incentive to make their repayment installments! It certainly does not hurt to imagine that someone is looking over your shoulder and judging your every financial move in light of your bankruptcy filing. This mentality is almost certain to result in better financial decision-making and more responsible expenditures.