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Bankruptcy expert Leon Bayer answers real-life questions.

Dear Leon,

I filed a face sheet Chapter 13 bankruptcy a few days ago in Los Angeles. Now I need a lawyer to take over my case and file the rest of my paperwork.

I filed for bankruptcy to stop my landlord from going ahead with an eviction trial. When the landlord served me with an eviction notice, I offered to pay up (I had just gotten money that my employer owed me). The landlord refused to take my rent money unless I paid an extra $800 to cover lawyer fees. I offered to pay late fees, but not the lawyer fees because I don’t think the lawyer did any work.

Also my car payment is two months behind and I want to keep it. I did a Chapter 7 bankruptcy three years ago. Now I need a to file a plan and make them take my money and save my car. Am I out of luck here?

Thanks,

Katrina

Dear Katrina,

I really wish I could have heard from you earlier, and you will too when you read this.

Most bankruptcy attorneys in Los Angeles  charge around $4,000 for a Chapter 13 bankruptcy.  Whether the landlord’s lawyer did any work or not, it would have been far cheaper for you to pay the landlord the extra $800 than to pay $4,000 to a lawyer for your own Chapter 13.

If You Continue With the Chapter 13 Case

If you proceed in Chapter 13, you can  force reinstatement of a defaulted lease. The drawback is that you will have to pay what you owe, in full. You will also have to pay the landlord’s court costs and whatever attorney fees are called for in your lease. You can also use  Chapter 13 to catch up on your car payments. But remember, you’ll have to fork over $4,000 in attorney fees to get legal help.

If you are considering representing yourself in the Chapter 13, think again. If you file Chapter 13 bankruptcy without a lawyer in the Los Angeles Bankruptcy Court, your chances of having a Chapter 13 case approved are less than 1% (even if you use self-help services from a bankruptcy petition preparer). These findings are contained in a recent study issued by Angeles Bankruptcy Court, Access to Justice in Crisis: Self-Represented Parties and the Court.

Solving Your Troubles Outside of Bankruptcy

Here is my suggestion. Try to make peace with the landlord. If you have been a good tenant up to now, most landlords would rather let you pay up and stay. The landlord knows there is very little chance of collecting from you after an eviction. A landlord also knows he or she is likely to lose  additional rent money while searching for a new tenant. Those are powerful reasons to convince any landlord that you should be allowed to stay.

You can also use the money you now have to catch up on your car payments.

You Cannot Discharge Debt in Your Chapter 13

If you do have debt you want to discharge (and maybe you don’t), be aware that you won’t be able to do so in your Chapter 13 bankruptcy. Because you got a discharge in a Chapter 7 bankruptcy case three years ago, you are not entitled to discharge any debt in your Chapter 13. To be able to discharge debt in Chapter 13, your Chapter 13 had to be filed more than four years after the date you filed your previous Chapter 7 case. However, you are not prohibited from filing for Chapter 13 and making payments under a repayment plan.  (To learn more, see Multiple Bankruptcy Filings: When Can You File Again?)

What you are now going through is a good example of why people need legal advice. Almost all Chapter 13 lawyers in Los Angeles will provide a free consultation. I am confidant that any veteran bankruptcy lawyer would have given you the same advice that I have. I hope things will work for you.

Leon

Leon Bayer is a Los Angeles bankruptcy attorney.  He is a partner at Bayer, Wishman & Leotta, a California law firm specializing in bankruptcy.  The opinions and advice in this blog post are from Mr. Bayer alone, and should not be attributed to Nolo.  By answering a question on this blog, Mr. Bayer does not become your lawyer.

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