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Ask Terry L. Your Own Question
Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2820
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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Good morning again! The case is dismissed. We are closing on

Resolved Question:

Good morning again! The case is dismissed. We are closing on the property this Friday. The same attorney wants to do our case again and charge $3500 for Chapter 13 again. He is gettling nicer and is willing to answer my questions by email and in person. For some reason he is treating me better than he treated my husband. I guess he wanted to get more money this way rather than risk his license by filing the motion to use Homestead proceeds for other purposes than purchasing a new home. Now he is telling me that before filing another ch 13 case we cannot pay off the car, unless it's under $1000. If we do, the total value of the car will be calculated into our CH 13 payments. Secondly, if we pay off the personal loan, we can only file the case 3 month after the payoff. Everything else, like IRAs, condo repairs, maintenance prepayment, medical expenses are fine. I forgot to ask him about buying new furniture or a tv set, computer. So, my questions: Is everything true what he is saying? Shouldn't he charge us less the second round?
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  Terry L. replied 4 years ago.

Terry L. :

Hi, thanks for your question. You should hire a lawyer for specific legal advice. No attorney client relationship is created here.

Terry L. :

Yes, payments to creditors, especially paying off a debt, would create equity in that asset.

Terry L. :

Chapter13's are designed to protect assets, and you must pay back enough of your unsecured debts to protect those assets. so, by paying $1000, you may be creating $1000 in equity in the bankruptcy estate, and would thus have to pay back $1000 more to your unsecured creditors.

Terry L. :

Preferential payments can be problematic in bankruptcy. Same applies here. I would follow your attorneys advice, the answers sound perfectly fine to me, and it is what I counsel my clients....no recent usage, no preferential payments, and don't pay any of the debts you want to discharge. Payments on financed items are fine, just don't pay ahead.

Terry L. :

Thanks for your question, let me know if you have any more!

Customer:
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