Kenilworth bankruptcy attorney illustrates that a debtor’s main reason for saving the property or reorganizing under Chapter 13 was to repay creditors over time. Many debtors have the belief that they can repay their debts over time; however they don’t have any significant evidence of this. Let me give you an example. If someone comes into my office and they have fallen behind on their mortgage, let’s say they are 10 months behind. I am going to ask them one specific question. That question is what caused you to fall behind on your mortgage? If the debtor tells me that they were laid off for six months, if the debtor tells me that they were injured for three months, if the debtor tells me that a roommate moved out and they didn’t have the income and now they have another roommate, then I’m going to be more apt to say you know what? You can make a bankruptcy Chapter 13 work because you had a problem that deprives you of income and now you have the ability to get that income back or you may already have that income back and you just want an opportunity to repay. That’s the debtor that I believe I can help. That’s the debtor that will have success under Chapter 13. That’s the debtor that has the ability to do a Chapter 13.
If, on the other hand, the person who is behind 10 months on their mortgage comes to see me and I ask them that question again, what caused you to fall behind on your mortgage? And they answer I just can’t make ends meet. Well, that prompts me to ask the next question. Did you have unemployment? Were you ill? Did you go through a situation which caused you to lose income? If the debtor cannot answer any of those with some sort of reasonable explanation, then I know that the debtor is just living above their means and that they don’t have the ability to actually repay the debt over the next 3 to 5 years if they file Chapter 13 bankruptcy.
In some cases, people just have to realize that bankruptcy will not provide the relief that they are seeking. Not everyone can own a home. Some people are better suited to rent an apartment. Although you can seek legal advice from a local bankruptcy lawyer, some decisions are not going to be in the form of a legal opinion. You have to look at your own financial situation to determine whether or not you have the funds to reorganize.