Debt Trouble Again After Bankruptcy

Letter to “Ask Leon”

In February of this year I became ill and was forced to shut down my EBay business. Currently I owe them approximately $47,000 in fees. I still do not have an income. I live with my adult children. A few years ago my ex-husband and I filed bankruptcy when he lost his job. Are there any bankruptcy options for me?

Leon Says…

You are definitely not alone in this. Many people find themselves with serious debt problems again and again. Luckily, in your case there is a remedy! You should consider filing Chapter 13 bankruptcy, (otherwise you would have to wait until 8 years after the old Chapter 7 case was filed). You are eligible for a Chapter 13 filing now, provided that the Chapter 7 case was filed more than 4 years ago. I’m assuming you have no valuable assets and below average income. If so, you can probably file Chapter 13 now, with a bankruptcy payment plan based on what you can afford to pay towards your debts over the next 3 years. Sometimes that amount works out to be just pennies on the dollar! Whatever you can’t afford to repay gets discharged by the Chapter 13 at the end of your 3 year payment plan. Sometimes the court will allow a plan to extend as long as 5 years if there is a good reason, but you would be better off to get in and out as fast as you can. For persons with valuable assets, and above average income the Chapter 13 rules are much more complicated, and the repayment plan must take into account the value of property that creditors would have received if you had filed again under a Chapter 7 case.