Personal Bankruptcy Story
A 60 year old senior from Georgia blogged on a bankruptcy forum website today asking the question why shouldn’t he file for bankruptcy. Here are excerpts taken from his personal bankruptcy story: “My wife deserted me 1 1/2 years ago and my divorce was just finalized. She left me with $15,000 of credit debt I’ve been trying to pay down but I can’t. I can’t even afford to buy shoelaces (the ones I have on now have broken twice and I’m trying to use them till they break a 3rd time)… I have to use a FOUR WATT lamp at night to see in the dark (I don’t turn the lights on to drive up the electric bill) and don’t use the heater in the winter (usually 38-42 degrees in the house – the cat hates it!!). It’s really rough… Just found out I owe taxes for last year (already making monthly payments for the year previous (when she left me). The wife is no longer here to help me with the things she said she would…. Only way I see my way out of all this mess is filing bankruptcy. I do plan to keep making payments on the house and car (both paid off in 5 years) and would like to keep those assets…Why shouldn’t I file for bankruptcy?”
Seniors on limited income, unfortunately, are often good candidates for filing bankruptcy, especially when a tragic events like a divorce, a sickness, sudden loss of income, or a variety of other unexpected events occur.
In the illustrated case above, this male senior was counting on his wife’s income for their retirement years, but instead, the divorce left him not only with income insufficient to sustain his level of living but with debts he can no longer maintain payments on.
The senior owes 5 years more payments on his house and car. The short time he owes on the house could indicate he has a great deal of equity in the home, depending on how big it is and where it is located in Georgia. Georgia homestead exemptions allow $10,000 in equity. For a car, the equity allowed is $3500. The state does not allow filers to use federal exemptions for assets, so their choice is dictated by state bankruptcy exemption laws alone.
Filing bankruptcy is all about protecting what assets you can legally keep in order to make a fresh financial start. The senior in Georgia wants to keep his home and car. That might mean he will need to file a Chapter 13 bankruptcy in order to keep his house, again, depending on how much equity he has in the house.
More than likely, the senior qualifies for filing a Chapter 7 bankruptcy, but one of the advantages of filing a Chapter 13 over a Chapter 7 is that you can keep your house as long as you keep making the payments on time. With a lot more equity in the home than what is exempt, the trustee may liquidate the home to pay off the unsecured debts of the credit cards if the senior files a Chapter 7.
Without knowing all the exact financial particulars about any bankruptcy situation, it is impossible to determine which bankruptcy is right for any given filer and how much assets they can protect. That is why is so important for a potential bankruptcy filer, like the senior in the illustration, to seek out the help of a bankruptcy attorney who can answer any questions he may have about protecting his assets.
- Chapter 7 Bankruptcy for a Family of Four (betterbankruptcy.com)
- Chapter 7 and Massachusetts Exemption Laws (betterbankruptcy.com)
- Chapter 13 Dismissal and Why It Might Happen (betterbankruptcy.com)
- Closing Asset Cases in Bankruptcy (betterbankruptcy.com)
- A Lawyer is Worthy of His Hire (betterbankruptcy.com)
Latest posts by admin (see all)
- Free Information Resources for Filing Bankruptcy - August 15, 2013
- When Creditors Change the Rules in Mid Stream - August 13, 2013
- Understanding the Concept of a Claim in Bankruptcy - August 8, 2013