A former client of mine dropped by the office recently. He had filed for bankruptcy about three years ago when things were really rough for him.
The bankruptcy gave him a new lease on life. He was fortunate to get a good job, one that allowed him to buy what he needed, when he needed it — without having to use credit.
But then he ran into another streak of bad luck. He became seriously ill and couldn’t work any longer. He is too young to be eligible for retirement and had filed for Social Security Disability, but that process takes quite a while and the rate of approval is unpredictable.
As I have told my clients in the past, they can get credit fairly quickly after their bankruptcy ends by doing a few targeted things. My former client was able to get enough credit to pay the rent, utilities, and transportation expenses. Food stamps didn’t quite cover what he needed, so he relied on the food bank.
Meanwhile, the credit card amounts rose to over $7,000 and the collection calls had started. My client was approved for Social Security Disability, so he had some income, and he was working part-time.
But he wants to do something about the debt.
Seeking Relief and Your Options
I put him into a small payment Chapter 13 reorganization plan of $100 per month to keep his creditors at bay. He will not be able to receive a Chapter 13 discharge of his debts, as his bankruptcy filing now is too close to his prior bankruptcy filing. But for five years, none of his creditors will be able to come after him because paying the $100 per month to the Chapter 13 Trustee shields him.
When the five years is up, it is unlikely that his creditors will come after him. If they do, he will be able to file a Chapter 7 at that time if needed.
Just because you have filed for bankruptcy relief before does not preclude you from seeking relief again. Contact Steidl and Steinberg and let’s take a look at your options.