Legal Question in Bankruptcy in Illinois

I hired a bankruptcy attorney a few months ago by paying a retainer fee, but have not yet supplied the information to file (I did not have the full amount to pay the attorney). Since then, my father passed, and I stand to receive approximately $10,000 in benefits. I have no other income, and have not had any income (and totally insolvent) for 3 years. I have one judgment against me, and numerous other credit card defaults.

My Question: If I file chapter 7 now, will they take the $10k to pay off creditors first, even if I have no other income to live on?


Asked on 1/14/12, 9:47 am

1 Answer from Attorneys
Henry Repay Law Offices of Henry Repay

You have an attorney and should turn to that attorney to continue to advise you. He has all the relevant information to best advise you. My limited reaction, since your financial situation has been so limited, is that if you use part of the benefit to pay the attorney, continue to meet your normal living expenses (groceries, utilities, etc.), and apply your exemptions to any remaining funds, you will likely be able to work around this, but there are a lot of considerations. You will want to be certain you are fully aware of any benefits you stand to receive because any "surprise" benefits that may come to light (such as the unexpected discovery of a life insurance policy) will properly be part of your bankruptcy estate.

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Answered on 1/14/12, 9:59 am


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