Louisiana residents currently facing serious financial problems will be glad to know there may be several debt relief options available. Various bankruptcy codes may apply that affect such options regarding each person’s eligibility status. It is critical that someone filing for Chapter 13 or another type of bankruptcy first seek clarification of eligibility requirements to avoid complications in the process. Rap star Lil’ Kim understands such complications all too well as she is currently trying to resolve some issues that have arisen regarding her petition for loss mitigation.
The mother of one is hoping the court will approve her application for Chapter 13 bankruptcy. However, the standing Chapter 13 trustee has objected to her request, stating that she has applied under a code for which she is ineligible. Kim’s secured and unsecured debts reportedly exceed $2 million each, which technically eliminates Chapter 13 as a viable option in her case.
In situations like this, a person can convert one type of bankruptcy to another. In other words, if Kim converts her Chapter 13 application to another type of bankruptcy that fits her particular needs and existing financial status, she may then be eligible for debt relief. Those who are eligible for Chapter 13 typically have reliable income through which they can propose alternate payment plans that allow them to satisfy most or all of their debt over an agreed-upon period of time.
The easiest way to determine whether Chapter 13, Chapter 7 or some other type of bankruptcy best fits an individual’s needs is to discuss the matter with an experienced debt relief attorney. Louisiana residents may want to do this before submitting a formal petition to the court. Doing so often helps prevent delays and legal complications.
