About Robert Vitt Expertise I am able to answer general questions regarding Chapter 7 and Chapter 13 bankruptcy cases. I have particular experience in personal (i.e., non-business) bankruptcies. I am unable to answer any questions pertaining to Chapter 11 bankruptcies.
Experience www.bankruptcy-ie.com
I am admitted to practice in the Central District of California and currently run my own law firm which specializes in bankruptcy.
Organizations San Bernardino County Bar Association, California State Bar
Education/Credentials Bachelor of Arts, Philosophy
Master of Business Administration
Juris Doctor
Master of Arts, Philosophy
Past/Present Clients I have had a variety of clients throughout my career. However, my immediate past clients have been predominantly individuals filing for debt discharge under Chapter 7.
Question My husband and i filed a Chapter 13 bankruptcy 2 1/2 years ago, since then my husband left his job and is eligible to cash out his profit sharing plan. we would like to do this and pay off the rest of our bankruptcy and make some much needed repairs on our home. Can we do this? We are in NC. My husband took a very large pay decrease and we are having a very difficult time maintaining our payments. we feel like this is only chance to save our home.
Answer Anita,
Generally speaking I do not do Chapter 13 so I am not as familiar with its processes, nor am I licensed in NC.
However, even supposing you could pay off creditors early (I am not sure that you can), I am not sure that you should.
Your underlying question is really "How do I manage my assets and debts?"...This is more of an investment question. The proper answer depends upon a number of factors, the state of your local real estate market, the strength of your husband's 401K investments, the amount of debt on the home, whether you could modify the loan you currently have to achieve similar results, what lifestyle you and your husband chose to adopt in the years ahead, etc. You will need to speak to a financial advisor to get some perspective on this. They should provide you with some perspective for little or no charge. Go with a CERTIFIED financial planner.
On the Bankruptcy front, I see you as having the following options:(1) Seek a hardship discharge (2) Converting your case to a Chapter 7 (3) Try to get a brief break from your Chapter 13 plan or modify your plan.
(1) Courts will sometimes grant a hardship discharge if three things are true: First, You failed to complete your plan payments due
to circumstances “for which you should not justly be held accountable.” Second, Based on what you have already paid into the
plan, your unsecured creditors have received at least what they would have received if you had filed for Chapter 7. Third, modification of your plan is not practical.
(2) Convert your case to a Chapter 7. You have an absolute right to convert your Chapter 13 case to a Chapter 7 case if you have not received a Chapter 7 discharge within the last 8 years AND you qualify for a Chapter 7. If you do not qualify for a Chapter 7 now, you may just qualify in a few months because your average income over the last six months will have gone down without your husband working. Consult with a local bankruptcy attorney on this, they will usually provide free consultations.
(3)Try to get a break from your Chapter 13 plan or modify your plan. If your problem appears to be temporary, the trustee may be willing to work with you in order to let you miss a few payments. Creditors do not usually object to the suspension of a few payments.
I hope that this gives you some direction and you are at least more aware of what your options are. Please DO NOT rely solely upon my advice in this situation. I urge you, given what is at stake, to consult with BOTH a bankruptcy attorney AND a financial advisor so that you can make an informed decision.
Hope this helps and my best to you and your husband.
