Article written by Columbia, SC bankruptcy attorney Daniel Stone
As a bankruptcy attorney, I am often asked to file bankruptcy petitions for my clients in expedited manners sometimes. Most of my potential clients are looking at filing for bankruptcy and want to know how soon they can get the expected relief they are seeking. However, in a certain percentage of my potential clients, my advice is not to file bankruptcy – but rather to either wait a period of time or not to file at all. Let me give you some examples. The classic example is a potential client with assets that are not covered entirely by the South Carolina exemption tables. For example, a man comes to me with $50,000 of unsecured credit card debt and he wants to file quick to avoid the stress the creditors are giving him. However, after consulting with him, I discover he has over $100,000 in equity in his home. While, approximately $56,000 is protected pursuant to the South Carolina homestead exemption, $44,000 would be non-exempt and potentially an asset a Chapter 7 Trustee could seize. In a case like this, it might be prudent to sit back and look at non-bankruptcy alternatives. Whenever I discuss non-bankruptcy alternatives to my potential clients, I first review with them the specific rights and powers each creditor has in South Carolina to collect on their debt. Then I review a best/worst case scenario.
In the scenario above, my recommendation to this potential client would be not to file a Chapter 7 bankruptcy. If the client could afford to, I would look at a 100% Chapter 13 bankruptcy as an option. While this may not look like much of an option, I have previously blogged about some options to include 100% Chapter 13 plans. In some instances, we can work out plans that can make their plan payment svery manageable. An example would be if some or all of the unsecured debt was subject to statute of limitation issues.
Finally, I want to point out that it always better if you can to be patient and find the right opportune time for you to file your case. Rushing to file a bankruptcy can be dangerous and you need to avoid if at all possible.