Whether you were already having financial trouble before the pandemic struck or you’re newly unable to pay your debts as a result of the crisis, we want to help answer some of the most pressing questions we’re being asked about bankruptcy during the COVID-19 pandemic. If, after reviewing the information below, you still have questions about your specific situation, contact our office to set up a time for us to talk.

• Filing for bankruptcy while unemployed – Bankruptcy filing eligibility is not impacted by employment beyond the fact that being unemployed can make you more likely to qualify for Chapter 7 or for a lower payment plan under Chapter 13.
• Chapter 13 bankruptcy hardship discharge – If you are already operating under a Chapter 13 bankruptcy plan, losing your job and being unable to keep up with your repayment plan can lead to your case being dismissed entirely.
• Converting Chapter 13 bankruptcy to a Chapter 7 bankruptcy – If you are already operating under a Chapter 13 bankruptcy plan and can’t afford to keep up with the repayment schedule, you may be able to transition to a Chapter 7 bankruptcy.
• Protecting your home – If you are unable to keep up with your mortgage payments as a result of losing your job or being furloughed, a Chapter 13 bankruptcy filing will allow you to make up the amount that you owe through a repayment plan. Under a Chapter 7 bankruptcy plan you will be able to protect some of your property and sell other assets to protect your home. Before pursuing bankruptcy, you may want to explore the possibility of getting your mortgage loan modified.  You should also be aware that the CARES Act (Coronavirus Aid, Relief and Economic Security) imposed a 60-day foreclosure moratorium on all federally backed mortgage loans, including FHA-insured reverse mortgage loans.
• Small business owner protections – If you are a small business owner who has been forced to shutter as a result of the COVID-19 crisis, filing for Chapter 13 or Chapter 11 bankruptcy can help you stay open by reorganizing your debts and reducing your payments to your creditors. However, it is important to speak with a financial expert before making your decision, as many of your outstanding debts may be dischargeable. For example, if you took out a Small Business Administration loan to start or grow your business, that debt can be discharged by filing for bankruptcy.

For help with bankruptcy, you can contact our experienced attorneys today!