It seemed like a vanilla chapter 7 case. A widow, living alone, impacted by Covid. $25,000 in credit card debt with high minimum payments. A prior bankruptcy more than 10 years ago. Under $60,000 in income. No house. No personal injury case to protect.
But I kept looking for RISK. Did you EVER own a house?….. and there is was: “My name was never on the deed, but when we got divorced I became entitled to a share of the sale proceeds. But the house is not going to be sold now because my adult children are living there with their father.”
Conclusion: no chapter 7. The bankruptcy trustee would clearly offer to sell the wife’s equitable distribution interest in the house to the ex-husband for $25-30,000. My client would lose more3 more than $100,000, and I would be sued for malpractice.
Instead, we decided to file a chapter 13 repayment plan. 100% of credit card debt over 5 years with no interest. The monthly payments would be about 1/3 of her current minimum payments, and she could afford them. https://www.silawfirm.com/bankruptcy-overview/the-chapter-13-bankruptcy-process/
Moral of the story: be careful who you choose to help you with bankruptcy. https://www.silawfirm.com/attorney/paul-hollender/