What Creditors Don't Want You To Know When Filing Bankruptcy

Filing Bankruptcy

What is it that your creditors don't want you to know when you file for bankruptcy, and it's not only what creditors don't want you to know it is also something that your bankruptcy attorney is not allowed to tell you, so I can tell you this on this article. You might think it's a free country and everybody is able to talk about what they want to talk about but that's not true in bankruptcy law.

In 2005 the bankruptcy law changed and since then bankruptcy attorney is not allowed to advise a client to incur debt shortly before filing bankruptcy and you would think well that is not that exciting I don't want to incur debt I want to get rid of my debt but your creditors are very smart and they lobbied hard and long to get these provisions into the bankruptcy law and here's why

When you want to file bankruptcy let's say you want to file chapter 7 bankruptcy you have to do the means test that determines if you are eligible to file chapter 7 bankruptcy and if your income is above median that means your income is above the median income in your country you would have to look at your expenses, if you still can file chapter 7

For example, you make payment on your car these expenses can be fully deducted from your income and that might lead to the fact that you can file chapter 7 bankruptcy, if you don't have these secured payments you might not be eligible and you would have to file chapter 13 and repay some of your debts

If you are in the position and you thought about getting a new car and a new car loan, a chapter 7 would be beneficial for you and incurring the debt would be beneficial for you but your bankruptcy attorney is not allowed to tell users, what you can do in that situation you can ask your bankruptcy attorney what would happen if I get a new car loan

Then the bankruptcy attorney can explain to you that Zeppo to make you eligible to file chapter 7 but even though a bankruptcy attorney would see oh if a said client gets a new car loan the client would be able to file chapter 7 would save a lot of money and would not need to go in chapter 13

But the bankruptcy attorney is not allowed to tell users so the bankruptcy attorney is not allowed to give you good legal advice, that's just how the law is and you would say well that's unconstitutional well the Supreme Court decided the question and decided that's totally fine, it's constitutional and bankruptcy attorneys cannot advise client to incur debt even if it would be beneficial for the client

The same as applicable in a chapter 13 bankruptcy case, in a chapter 13 bankruptcy case you might have to pay a portion to your unsecured creditors if you have a secured payment the secured payment is deducted from your money you have left over every month so if you have a secure payment you pay less to unsecured creditors, so to have a car loan might be beneficial if you have a new car and you would have to pay less to unsecured creditors

This is something your bankruptcy attorney cannot advise you to do so here again you would have to do the first step and talk to your bankruptcy attorney about the fact what would happen if I get a new car loan and then the bankruptcy attorney is able to tell you well it would lower the guarantee to unsecured creditors and you would have to pay less in your plan




That is What creditors don't want you to know when filing bankruptcy, hopefully, you learn something new today

Author:

Hi, i am Micheal, the guy behind Roadtosuccesse. I share tips and tricks to help take a business to the next level, show which systems I personally endorse and use, share what I learn as a student of the game, and help people with personal development so that they can reach their full potential.

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