For most people who file a Chapter 7 or a Chapter 13 bankruptcy case, the process is smooth and straightforward. Although it may be emotionally difficult for you to file for bankruptcy, sometimes it’s the only option. Unfortunately, sometimes a creditor may still try to sue you after you’ve filed bankruptcy.

Will Chapter 13 stop a lawsuit?

What about filing bankruptcy after losing a lawsuit? Whether you’ve just been served with a summons and complaint or the case has been concluded and a judgment entered against you, filing Chapter 7 or Chapter 13 bankruptcy will stop the lawsuit and related collection actions.

Is Chapter 13 considered a Judgement?

Just like in Chapter 7, deficiency judgments are treated as unsecured debts in Chapter 13 bankruptcy unless your lender placed a lien on any of your assets before filing. When you complete your Chapter 13 plan, the deficiency judgment will be discharged.

Does bankruptcy prevent lawsuit?

Filing for bankruptcy can be very powerful, primarily because of an order called the automatic stay. The stay stops creditors from engaging in debt collecting actions, including pursuing a lawsuit. However, some lawsuits aren’t affected by a bankruptcy filing.

What assets are protected in Chapter 13?

You’re allowed to protect, or “exempt,” a certain amount of equity in the property you’ll need to maintain a home and job. If you want to keep nonexempt property, such as a boat, baseball card collection, or another luxury item, you’ll have to pay for it through your Chapter 13 plan.

Can you file a lawsuit during a chapter 13 bankruptcy?

Claims that arise during the Chapter 13 case are also property of the bankruptcy estate and you must disclose them to the bankruptcy court. If you think you have a claim against someone else, even if you don’t plan to file a lawsuit, contact your attorney to discuss whether it will be necessary for you to disclose the potential claim.

What happens if I file a lawsuit in the middle of my bankruptcy?

If you file a lawsuit during your Chapter 13 bankruptcy case, you must disclose this fact to the court and the bankruptcy trustee and must amend your bankruptcy schedules if it’s not already listed. Also, the lawsuit might mean that you have to pay more into your Chapter 13 plan.

Can a debt be discharged outside of a chapter 13 bankruptcy?

If you don’t want to include the new debt in your Chapter 13 plan, you do nothing and incur the debt without first getting court approval. In this situation, you pay the debt outside of your plan. At the end of your bankruptcy, the debt will not be discharged.

Can a post petition debt be included in a chapter 13 bankruptcy?

You can include post-petition debts in a Chapter 13 case under special circumstances. First, you must obtain the consent of the bankruptcy trustee before you incur the new debt. Second, the post-petition creditor must consent to its inclusion in your Chapter 13 repayment plan. Finally, you must obtain court approval.