- Author: George Haines
- Published
Let’s say you are being sued for something, such as not making a payment on your credit card, your car or some other payment that you owe but are having trouble paying.
Maybe you’re thinking of filing for Chapter 7 or Chapter 13 bankruptcy in Las Vegas in the not-too-distant future. And if so, maybe you’re tempted to think, “If I file for bankruptcy, I can get rid of these debts, so I really don’t need to worry about this lawsuit.”
However, it’s important to understand that that is the wrong way to think about the situation. Here’s why:
If a lawsuit is filed against you and you ignore it and don’t file an answer, then the court will enter a judgment against you.This is a big problem for you. Because a judgment means the creditor has a lien on your property. And that changes the nature of the debt to a “secured debt” instead of an “unsecured debt.”
Why is secured debt a problem? Because it’s much harder to get rid of secured debts in a bankruptcy case. For example, if you were to try and sell your home or other real estate to pay off your debts, you would need to pay off the secured debt before you could make the sale.Also, if you file for Chapter 13, then secured debts generally have to be paid in full. So that means more money for your creditors and less for you.
The main points to take away are:
- Do not ignore lawsuits. Make sure you at least file answers to them so that the plaintiff cannot easily get a judgment against you. And of course, always talk to a lawyer if possible.
- If you think bankruptcy may be in your future, definitely talk to a bankruptcy lawyer to make sure you plan ahead and protect yourself as well as possible.
For the best bankruptcy information in Las Vegas, please feel free to get in touch with us for Las Vegas bankruptcy help. We offer free consultations, so it never hurts to get in touch by phone or set up an appointment so that you can talk with good bankruptcy attorneys in Las Vegas and get answers for all your questions and concerns.
