When you file Ch. 7 bankruptcy, how are future payments or insurance policies effected? I'll be receiving a small settlement from an accident around 20k. within a couple months. It's not enough to pay the debt. But I do know that I'm left in a will that would be a substantial amount but I don't know when that will be. How long after filing can something like that be effected? I'd prefer to not file and pay a portion, but the amount of debt is bear 80k to two creditors and I'm not sure they'd settle for an amount low enough for me to handle. Even if so, I'm not sure how to negotiate with them to get the least damaging info on my credit report. I'd appreciate any advice. Thank you
1 Answer from Attorneys
The Trustee in Bankruptcy can pursue inheritances and life insurance pay-offs that accrue up to 6 months after bankruptcy is filed.
As to your credit, if the debts are in collection your credit is already affected. You can ask that as part of any settlement the creditor remove any negative charge on your credit, but that is often difficult to arrange, particularly when they have sold off the debt.