Legal Question in Bankruptcy in Louisiana

Chapter 13 Default...

If Bob's Plan fails there are several things that could happen. One is that his case could get converted to Chapter 7 whereon his assets are subject to liquidation to pay creditors, and, unless his Ch. 13 Plan was a 100% plan, there may be more than $8,000.00 to pay in the Ch. 7. When you say "co-owners" do you mean joint tenants? If so, a trustee could force the sale of the house. You may be better off borrowing against the equity on the home and making Bob agree to repay that amount.

Chapter 13 Default

If Bob defaults on his Chapter 13, it will be dismissed and he will be in the same situation he was in before he filed. Any creditors with judgments against him can force a sale of his interest in the real estate.

I question the baloon payment in a Chapter 13 Plan. Most Chapter 13 Plans are funded with wage deductions and payments are equal throughout the life of the Plam. Ask Bob to show you the Plan approbved by the court then take it to a bankruptcy lawyer if you have any question.

Your interest in the house cannot be ordered sold to pay Bob's debts unless you are a co-signer (in which case, you would probably be in the Chapter 13 with him). Only Bob's interest could be sold and you could keep your interest; that would make you joint owner with whomever bought Bob's interest.

I would advise consulting a Bankruptcy lawyer in Louisiana.

The foregoing does not create an attorney-client relationship but is for general information purposes only. The questioner is advised to consult with a practitioner in the questioner's geograhic area whose advise may be different from the foregoing.