tito wrote:
My fiance is mulling bankruptcy with $40k in credit card debt
(including one auto loan). An attorney cautioned this may have long
term repercussions. Later this year, she is likely to receive
approximately $20 - $30k from a lawsuit involving a car accident 3
years ago.
1) If she is declared bankrupt under Ch 7, can creditors still go
after
the settlement proceeds from the lawsuit (assuming the bankruptcy
comes
first)
So, it sounds like she's trying to see if she can get the debts
discharged without mentioning the settlement, and then keep the money
when it finally arrives (instead of passing it on to her creditors.)
Well, she is supposed to declare the settlement on her bankruptcy
paperwork. Her her bankruptcy trustee will ask if any settlements or
other incoming payments are expected. If she gives a false statement
to the trustee, she is perjuring herself. Her lawyer, if she still has
one when she files, will (if he or she is a smart lawyer) discourage
her from perjuring herself.
She will get exemptions when she files Chapter 7, and she may in fact
be able to keep at least some of the money.
