When individuals face financial difficulties, bankruptcy may be an option that they wish to consider. Working to eliminate debt may not always be easy for Ohio residents, and bankruptcy options may help them understand that they could work toward a fresh financial start. However, parties must qualify for certain types of bankruptcy, and individuals may be interested in a case in another state in which the type of bankruptcy used was determined by the court.
It was reported that one man facing approximately $2.5 million in debt had originally planned to file for Chapter 13 bankruptcy. This type of bankruptcy allows a qualifying individual to pay back debt over several years through a court-approved payment plan. However, the bankruptcy judge presiding over the case apparently did not feel that this type of filing fit the situation.
Rather than allowing the man to pay back his debts over time, the judge ruled that the man’s Chapter 13 filing must be converted to a Chapter 7 filing. As a result, the man must now liquidate his assets in order to pay back creditors in a shorter time frame. This ruling came about due to the judge reportedly feeling that the man had a history of dishonesty in court.
As this case shows, filing for bankruptcy can be complicated, and parties may face unexpected changes. However, Ohio residents who are concerned with their finances may be able to learn more about the various types of bankruptcy and for which type they will most likely qualify. By discussing their interests with an experienced bankruptcy attorney, individuals may be less likely to face unexpected challenges during their proceedings.
Source: arstechnica.com, “Judge: Prenda lawyer must sell condo, liquidate assets to pay $2.5M debt“, Cyrus Farivar, Dec. 4, 2015