More Lessons From Bankruptcy Lawyer in Indianapolis

This week I've been using my Bankruptcy in Indiana articles to highlight court decisions from other states in order to teach how individual bankruptcy in Indiana works. As a debt consolidation lawyer offering bankruptcy services in Indiana, I've helped tens of thousands of individuals file personal bankruptcy in Indiana. Despite these large numbers, the fascinating thing is, each situation is a little different from all the others.

Sometimes the clients who come to me for help (or who turn for help to one of the Anderson, Indianapolis, Bloomington, or Columbus bankruptcy lawyers who work in the Zuckerberg bankruptcy law offices) have made good decisions. Yet circumstances beyond their control (usually some combination of illness, job loss, and divorce) caused their financial problems to become overwhelming.

Other clients, even with all good intentions, are suffering the results of poor decisions they've made. A Chapter 7 bankruptcy case from North Carolina illustrates how the court looks at decisions Chapter 7 debtors make leading up to the time they file bankruptcy.

In 2006, husband and wife R. and K. listed their home for sale after signing a contract for a new home.
For 15 months, R. and K. owned two houses, unable to sell their former residence.
In June 2008, R. and K. sold their first home in a short sale.
A month later, the couple purchased a Disney Vacation timeshare.
In July, 2009, R. and K. purchased two cars at a combined price of almost $70,000. (Their monthly car payment actually went down as a result of the process.)
R. and K. filed Chapter 7 bankruptcy.
The bankruptcy court rejected their petition. The reasoning: The couple had shown bad faith in purchasing, on the eve of bankruptcy, two expensive vehicles. They also did not, the court ruled, need such an expensive home. R. and K., the court ruled, could afford to repay their creditors if they moved to more affordable housing and drove less expensive cars.
The court recommended that R. and K. convert to a Chapter 13 debt repayment plan bankruptcy.

Whenever I'm helping clients through the bankruptcy process, I help steer them through a long list of "to-do's" that need to be completed before actually filing a bankruptcy petition. I also explain that there's an equally long list of "not-to-do's". As a long time lawyer for bankruptcy in Indiana, I know one thing:

It can be very important not only to do the right things before bankruptcy in Indiana, but to do them in the right order!