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VanDLaw, Attorney
Category: Bankruptcy Law
Satisfied Customers: 833
Experience:  Chapter 7 & 13
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To XXXXX XXXXX receiving my small P.I. Settlement, ...

Customer Question

To: XXXXX XXXXX receiving my small P.I. Settlement, can I use the proceeds to buy a home and a car (renter for 10 years, no car for 18 months) and then declare bankruptcy to remove the judgement, etc. from my credit without being penalized for the basic purchases by the bankruptcy court? My insurance company is ERISA and intends to sue me for what they've paid out on my medical bills so my net may not be big enough to fully purchase a home.
Submitted: 9 years ago.
Category: Bankruptcy Law
Expert:  VanDLaw replied 9 years ago.


It will depend on how long you wait after receiving your PI settlement. It is usually 1 to 2 years that they ask if you have received anything. Your medical bills would be discharged if you did declare bankruptcy.

However, keep in mind that anything you have an ownership interest in at the time you file for banktruptcy is subject to liquidation. So if you buy a home and a car, you would have to-at the least reaffirm them, because any equity would be subject to liquidation.

The longer you wait to file, the better chances you will have with the courts not attaching your PI settlement, but unless it has been two years (my estimate) you may have to disclose your settlement, and then it would be up to the trustee to deal with that at the time.

VanDLaw and other Bankruptcy Law Specialists are ready to help you
Customer: replied 9 years ago.
Thank you for the information you have shared. I'm now a little less comfortable with my situation though not happy by any stretch of the imagination.
Expert:  VanDLaw replied 9 years ago.
I understand debt can be very stressful. I wish you good luck!