Is your Chapter 13 doomed to fail?
Did you know that approximately 50% of these chapter 13 cases will fail?
By failing, I mean that the cases end before the debts are discharged. Yes, sometimes the cases convert to Chapter 7 and the debts are ultimately discharged in Chapter 7.
But the truth is that most of the Chapter 13s that fail do so because the debtors who file Chapter 13 are not well-prepared to take on the challenges of Chapter 13.
This is bad because the bankruptcy filing goes on the debtor’s credit report–does about 350 points damage to the credit score–and doesn’t result in relief from debt.
Who’s at Fault?
- Maybe it’s an unrealistic budget that proposes to put so much in the plan that there isn’t enough money to eat.
- On the flip side: Maybe the debtor’s budget proposes expenses that will be deemed excessive in the eyes of the trustee.
- Maybe it’s the attorney who misunderstood, or miscalculated, the debts that would be paid on in the plan, or who didn’t know that the client didn’t qualify for discharge.
- Maybe there is too much debt to qualify for Chapter 13 discharge.
- Maybe it’s the client who wasn’t totally candid about the types of debts that would need to be paid.
- Maybe it’s the client who thinks that he or she can go it alone (Don’t!)
It’s your Chapter 13 bankruptcy attorney’s job to take the time to work through these kinks with you before you file your case. Don’t waste time and money on an attorney who won’t be bothered to do these calculations for you. If you’re interviewing attorneys, get up and leave if you feel like you’re not being treated well by your attorney. If you’ve already filed and want a new attorney, it’s not too late to switch so long as you are pre-confirmation.
You need an advocate who understands the code, and the Chapter 13 trustees in our district.
Call me, Attorney Shannon D. McDuffie for my advice about your Chapter 13 plan. (404) 418-8879.