Those who are feeling overwhelmed with debt consider a variety of options for re-gaining control of their finances. For those who have accumulated an extreme amount of debt, bankruptcy sometimes seems like the best solution. Before deciding to file for bankruptcy, however, there are many things one should know. Some of them are specific to filing bankruptcy in Texas.
Texas Bankruptcy Law
Revisions to bankruptcy law several years ago included a mandate that everyone who files bankruptcy in the state of Texas must enter a credit counseling program at least six months prior to filing. In order to file for chapter 7 bankruptcy, one’s income must be less than median income within the state of Texas capable of only paying $6000 or less over the repayment period, or less than one-quarter of overall debt. Those interested in filing should also be aware that they will be expected to provide a two-year history of financial records, and those considering paying for a Chapter 13 must also submit a plan for reorganization and repayment with their petition.
As soon as your petition is filed, your creditors are prevented from taking action against you. At that point, they will have a period of time (typically 60 days) to file a claim that you owe them money with the court. If you included a debt in your bankruptcy filing and a creditor does not file with the court, they forfeit the right to the debt. Filers should also note that payments under Chapter 13 filings begin as soon as the claim is filed with the court.