3. Failure to reaffirms a mortgage may disqualify you from loan modification or a refinance later. As stated above many mortgage companies refuse to entertain a modification after a bankruptcy and are much quicker to start a foreclosure if you become delinquent in the future.
4. Attorneys make more money in Chapter 13 than Chapter 7. The presumptive fee set by the Western District of NC Bankruptcy Court for Chapter 13 is $4,500
5. Many Chapter 13 clients never complete the plan. Making payments for 3-5 years in a Chapter 13 is a long time and many debtors either convert to Chapter 7 or are dismissed for failure to make their required payments.
6. Inheritances within 180 of filing Chapter 7 go to your creditors. If you inherit money during a bankruptcy you have a duty to disclose and the bankruptcy trustee is tasked to pay your creditors. This duty applies during the entire duration of a Chapter 13 plan.
7. Future tax refunds are often at risk in Chapter 7. The bankruptcy trustee is supposed to look at all assets to determine if anything can be paid to creditors. Future tax refunds are a great source of hidden money.
8. Co-debtors will be notified when you file bankruptcy. If mom or dad co-signed on your car they will receive notice that you filed bankruptcy.
9. If you repaid family or friends in the last year they may be sued if you file bankruptcy. If you have been paying mom and dad for that loan every month they may be asked to return the money or be sued by the bankruptcy trustee.
10. Debt negotiation may be a better option. Many old debts never resulting lawsuits and sometimes a wait and see approach is a better option to handle any that do arise.