What bills do I pay if I file bankruptcy
In addition to your recurring expenses such as utility bills (you don’t want your power cut off!) you must continue to pay certain creditors. You must continue to pay your secured creditors even after you have filed bankruptcy.
Secured creditors are usually the lender(s) on your house and / or car. If you don’t make your regular house payment, the bank or mortgage company will foreclose. If you don’t make your car payment, the lender will repossess the car. Foreclosure or repossession during a bankruptcy does require pre-approval of the bankruptcy court, but such pre-approval is routinely granted.
Unsecured creditors, usually credit cards, you need not continue to pay, at least temporarily. Some credit card debt(s) may not ultimately be dischargeable at all. For instance, Sears, unlike most credit card issuers, has a provision on its charge slip which gives it a secured interest in whatever you bought with their card. In a Chapter 7, you will pay none of the unsecured creditors.
In a Chapter 13, unsecured creditors will be paid by the bankruptcy trustee through the plan. You will not pay the unsecured creditors directly. You must, however, make your Chapter 13 plan payments in full and on time. Failure to do so may result in the trustee requesting your case be dismissed. The first plan payment is generally due thirty days after the filing of the Chapter 13 Plan and Schedules.
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