Question: If you file a bankruptcy petition, will that affect your case?
Answer: The worst thing you can possibly do is file a bankruptcy petition.
There are two kinds of bankruptcy cases for individuals: Chapter 7 and Chapter 13. In Chapter 7 bankruptcy, you seek to wipe away all of your debts and in return you lose almost all of your possessions and money. In Chapter 13, you keep your assets and money and seek to repay your debts over a three to five year period.
In Chapter 7, you lose ownership of your assets, including any personal injury claims, and your lawsuit becomes the property of your bankruptcy estate. When you file a bankruptcy petition, the bankruptcy trustee takes over control of your lawsuit and I am no longer permitted to represent you—I become the attorney for the bankruptcy trustee. If the lawsuit is successful, the bankruptcy trustee uses the settlement money to pay your debts, and if any money is left at the end, you might get something from the case.
It is always a bad idea to file a bankruptcy petition when you have a lawsuit. Whatever you do, you should always speak with your injury lawyer before you file a bankruptcy petition. If you file a bankruptcy petition, you may lose all of your right to any of the money recovered in your injury lawsuit.
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