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WA Bankruptcy Lawyer
WA Bankruptcy Lawyer, Attorney
Category: Bankruptcy Law
Satisfied Customers: 25
Experience:  30 years practice. Author of several articles.
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More info. on filing a chpt. 13 -It was a recent suggestion

Resolved Question:

Do to an auto accident 2 1/2 years ago I have lost a lot of assets & beyond my injuries I am really in poor financial straights. When the accident happened my newly formed business went under and left $50k of debt on business credit cards, lines of credit, & such. I made a deal with one, the other two are not really pushing it, they are not real aggresive, but I have just recently being sued. I was issued a summons from a debt collector in the past month+. If they get a judement towards me, what can they do? My PI lawyer tells me that I can't file bankruptcy, chpt. 7 because the creditors would take most of my settlement, so we never talked about bankruptcy options again. Today I spoke to a bankruptcy lawyer out of the blue. He told me you 'need to file a chpt. 13 to protect yourself from any judgements, he says it won't affect my settlement & will lprotect you now from further financincial destruction of your property, etc. Is this honestly the way "you" would go? Why?
Submitted: 9 years ago.
Category: Bankruptcy Law
Expert:  WA Bankruptcy Lawyer replied 9 years ago.
When you file a bankruptcy, all of your assets, including personal injury claims become property of the bankruptcy estate. Depending upon your state you may or may not be able to exempt them. If you file a Chapter 7, the trustee takes control of the assets, including your personal injury claim and can settle it or do with it what he wants.

A Chapter 13, on the otherhand allows you to propose a plan and take into account the personal injury claim. The value of the claim needs to be included in your schedules and dealt with. However, and it is a large however, you retain control of the claim and still make decisions concerning the initial decision to settle or not.

In either case it needs to be listed because the failure to list it will be used against you by the person who hit you.

Based upon the information provided it is impossible to tell how bad off you are. If you are going to file any bankruptcy, a 13 is the only one that makes sense given the information disclosed. GIven the increasing pressure, especially with the new law suit, it makes sense but only an attorney with all of the information can really answer that question.
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Customer: replied 9 years ago.
I have very little money now, basically living on SSDI, $800/mo. I don't know how I could manage paying my creditors anything unless it was really small. Is the number based on your current income? Secondly, and this goes back to my original question. In what ways, mostly I am concerned about the negative consequencws it may have on my lawsuit against the other drive and the settlement amount. Do I have full control in how I deal with my debtors once settled? ... and, is there any reason as to why my current PI lawyer has not suggested this for me, he knows how dire my circumstances are? Thank you.
Expert:  WA Bankruptcy Lawyer replied 9 years ago.
Its based upon current income and the expected recovery in the PI case. Once it is settled, if you are in a 13 you are bound somewhat by the plan. However, a Chapter 13 can be dismissed and then there will be control.

As to why your PI attorney has not suggested it, I do not know. My guess is that he is a PI attorney and knows nothing about bankruptcy. Most PI attorneys are not bankruptcy lawyers. It is a totally different skill set.
Customer: replied 9 years ago.
okay, can you expand on just a couple ideas here... 'you are bound by the plan'... what does that really mean in terms that I can understand
? Also, 'a chapter 13 can be dismissed', what does that mean?. I think I have a good PI, pretty up front with me, I'll ask him why he did not offer it up.

Lastly, just to confirm I understand this, this in no way affects the amount of money I receive in my settlement. And once settled and the money is turned over to me, do I still have a responsibility to those debtors? More specifically, right now they are all throwing up offers that are significantly below what I originally paid, unfortuneately I can't take advantage of this because I have no cash. After the Settlement are they goning to expect or be entitled to the full amount?

I've used this service before, I like it and I will continue to do so. Can't I find out more about you, the attorney who is helping me? Just to say I spoke to so and so about this and 'this' is what they said. Do you have a profile? Thanks again. That's all I have, appreciate it.
Expert:  WA Bankruptcy Lawyer replied 9 years ago.
You are bound by the plan means that as long as you are in it, the terms that are confirmed are the terms you live with. DIsmissal means that. The case is dismissed -- it is as if it was never filed (although there will be repercussions if you try to refile).

As to dealing with creditors - After dismissal - yes. If you pursue the plan what you propose and what is accepted binds creditors as well.

As to finding more about me - I have no idea what the rules are. You really need a lawyer who practices in the district where you are. There are all sorts of local exceptions.