Boston Bankruptcy Attorney

Losing Employment While in Bankruptcy

In today’s current economic situation, lay-offs are announced on an almost daily basis. Not just one or two people being laid off for poor performance or something similar but thousands at a time by major corporations. These lay-offs are typically part of a larger restructuring plan that the company is employing. Unfortunately, the odds are not outrageous that someone who is laid off by the company will be in bankruptcy already.

When people enter chapter 13 bankruptcy, they are making monthly payments to a trustee based on their current income. The current income is typically based on a person’s paycheck from work and dividends from stocks which, currently, are also suffering. When a person loses that income, his or her ability to make the required monthly payment is severely jeopardized.

If a person fails to make the required monthly payments, the entire chapter 13 process can be tossed out. It is crucial that once in bankruptcy, a person make all of the necessary payments. If it is not going to be possible to make the payments required, it is important to be in touch with the trustee.

The trustee, in some cases, may be able to renegotiate with the creditors that are being paid on a monthly basis. In other cases, it may be possible to move to chapter 7 and have all debts discharged, particularly in cases where income is virtually nonexistent for a minimum of six months. This period is necessary for individuals to have their debts discharged because then they will be in the right area for the means test.

Contact a Boston Bankruptcy Lawyer

If you are facing a mountain of debts and have very little or no income, contact the Boston bankruptcy lawyers of Joshua Spirn & Associates at 1-800-975-5346 to discuss your situation and to determine your best bankruptcy option.