Entries in the 'Bankruptcy Settlements' Category ↓

The current state of the economy has forced many individuals and businesses to file Chapter 7, Chapter 11, or Chapter 13 bankruptcy. Homeowners behind in their mortgage loans face foreclosure or short sale. There are extreme tax consequences for filing bankruptcy and foreclosure which can affect your financial future for a very long time. A bankruptcy attorney can advise you what avenue you should pursue to get yourself back on the right financial path.

Facing a large amount of debt can be extremely overwhelming – for anyone. To resolve this financial problem, people often choose to file for bankruptcy with the hopes of starting fresh.

When deciding whether or not you should file, it’s important to consider all factors and all options you have before taking any action. You should also make sure to recognize all of the pros and cons of using a debt settlement company instead of filing for bankruptcy.

What to do:

-Get a copy of your credit report from a credit reporting agency.

-Go over your report and look for any mistakes and figure out your credit score. Determine how much debt you have in total and if it’s possible to pay down your debt with your current income.

-Based on all of your findings, decide if you’ll benefit from using debt settlement services. To qualify for that help, you must owe at least $7,500 in unsecured debt. You should find out what the unsecured debt balance requirements are required by each settlement company.

-Research different settlement companies and what services they offer. Make sure you understand all of the pros and cons when deciding if this is the best debt solution for you.

-If a debt settlement is not best for your situation, make sure to research what other options you have besides filing for bankruptcy. But if filing for bankruptcy is your best option financially, go for it. If you’re unsure of what to do it’s always helpful to speak to a bankruptcy attorney to explore your options.

An experienced Seattle bankruptcy attorney understands that filling bankruptcy in Washington can be tricky if you do not have a thorough understanding of the law.  Learn a little bit more about the most recent changes in Washington bankruptcy rules that could affect your bankruptcy claim.

Rule 1006-1. Filling Fee

• Waiver of Filling Fee:  An individual filling Chapter 7 bankruptcy can a apply for a filling fee should file an Official Form B3B with the voluntary petition.  Bankruptcy cases will not uphold the Local Rule W.D. Wash. CR3(b)
• Payment by Installments:  A debtor who can only meet the filing fees by installments must file an Application to Pay Filing Fees in Installments, Official Form 3A at the same time of filing the petition.

Rule 1007-1.  Lists, Schedules, Statements

• File Schedules & Statements Time Extensions: Requests for extension of time and file schedules, statements and documents required by Interim Fed. R. Bankr. P. 1007 must be filled before the filing expiration date.  It also needs to be made on a notice of 7 days.  If a motion for extension is not filled in a timely manner, the order can be presented ex parte and contain the following mandatory information:  date of petition, due date of schedules and statements, date of the § 341 meeting of creditors and the reason for delay.
  • The debtor must arrange a continuance of the meeting and mails to all creditors with a trustee in order for the courts to extend the date for filing schedules, statements and documents within 7 days.
  • Active military debtors are required to indicate this status on Schedule I.  For individuals on active duty or being deployed after the filing the voluntary petition for a period to exceed 14 days must set forth the starting and ending dates of the active duty or deployment, new address information, a copy of official orders, social security numbers which only show the last four digits and the name, and ss numbers for any entirely redacted non-debtors.

To consult with an experienced Seattle bankruptcy lawyer contact the law firm of Carrington Nuamah by calling 206-965-8726today.  You can also consult the Washington Bankruptcy Courts for more information

Bankruptcy can be a lifesaver for the honest but unfortunate debtor.  However, it doesn’t solve all financial problems or wipe out all debts.  For instance, Bankruptcy can’t solve a current financial squeeze when your current income does not cover your normal current bills (rent, utilities, food, gas, car payments, etc…).  Consult a local Tucson bankruptcy law firm for more information.

Also, Bankruptcy doesn’t discharge debts after the filing date.  Bankruptcy can only clear the slate with old debts – like credit card balances, previous apartment rental debts, old utility bills, and previous repossessions, etc….  Bankruptcy filing only discharges debts before filing, not new debts.  For example, if you or a family member is currently recovering from an accident or disease with significant medical bills, a bankruptcy can only discharge the medical bills to the date of filing, not any future medical bills after filing.

Bankruptcy also does not discharge: Taxes; Student Loans; Child/Family Support; Court Fines, Fees, and Restitution; Drunk Driving Accident Claims; Fraudulent Debts or Fiduciary Obligations; and Business debts involving wages and employee benefits; and New Debts within 90 days of the filing date (see Chapter 13 bankruptcy in Tucson).  These debts are considered a priority, and Bankruptcy does not affect them.   However, a Chapter 13 Bankruptcy can help you avoid the normal collection harassment by setting up a 3 to 5 year repayment plan for many of these debts.

When determining whether or not to file for bankruptcy, the home is often a main consideration.  Keeping your home while filing for bankruptcy depends on several factors:

• How much equity you have in your home
• The type of bankruptcy—chapter 7 or chapter 13
• State laws on homestead exemption

Equity in the home

If your home equity is exempt, the bankruptcy trustee will not attempt to sell your home, whether you are filing a chapter 13 or a Chapter 7 bankruptcy in Chicago.  Equity is calculated by subtracting home sale costs, payoff balances, and lien amounts from the current market value of the home.

Chapter 7 vs. chapter 13

In a chapter 7 bankruptcy, the trustee sells assets to pay creditors; whereas in a chapter 13 bankruptcy a wage earner’s plan is created, debt is restructured, and the trustee collects your payment for creditors every month.  Because of the difference in how these two bankruptcies are managed, there is a greater likelihood of losing your home in a chapter 7 bankruptcy.  People with substantial equity in their homes usually decide to file a chapter 13 bankruptcy.  During chapter 13, an automatic stay is in effect, which goes on for three to five years.  The stay prevents mortgage companies from foreclosing on your home, and you are given extra time to catch up on mortgage payments.  However, if you fail to make your mortgage payments, or if the bank forecloses before you file a chapter 13 bankruptcy petition, you could still lose your home.

State laws on homestead exemption

While bankruptcy is handled at the federal level under the U. S. Bankruptcy Code, states have jurisdiction over allowable exemptions that may be claimed during bankruptcy.  Each state has a list of property exemptions.  Property that you select as exempt is detached from the estate during bankruptcy—meaning creditors cannot seize or demand sale of that property for payment.

Illinois limits the homestead exemption to $15,000 for two people living in the same home and $7,500 for one person.  If your equity in the home is greater than these amounts, you stand to lose it in a chapter 7 bankruptcy.

Jay Fortier is a bankruptcy law firm in Chicago who previously worked as a financial advisor for a large, national financial advisory firm.  He also serves as an associate real estate broker with Sky High Real Estate, INC and is a licensed REALTOR™.  His financial experience helps him guide clients to go beyond bankruptcy and understand how they became insolvent, helping them to plan for future solvency.

Managing life before debt discharge

When your Chicago bankruptcy filing goes into effect and creditors are being paid, you need some guidelines to follow:

• Complete the pre-discharge debtor education course offered by a provider approved by your trustee.  You will receive information about budgets, managing money, and wise use of credit.  Keep your certificate received as proof of doing the course.  You will need to submit it to the trustee in order to receive your debt discharge.
• Do not sell or transfer any assets without contacting your lawyer.  Selling or transferring assets during bankruptcy is considered a fraudulent transfer.
• Contact your attorney when you receive notice for the Creditor’s Meeting for a chapter 7 bankruptcy.
• Bring the following documents to the Creditor’s Meeting:
• State ID card or driver’s license
• Last tax returns filed
• Vehicle titles
• House deed
• Any other property titles
• Mortgage statement showing last balance
• Property tax bill
• Divorce papers (if recent divorce)
• Current pay stub
• Pension/401K plan statements
• Stock/bond certificates
• Do not pay back loans of $600 or more to business associates or relatives.  The trustee can recover the money paid and divide it equally among creditors.  In fact, if you repaid loans that were $600 or greater within the year prior to filing bankruptcy, the trustee may demand a return of those funds.

Life after bankruptcy

You are free from debt, which is a new relief.  However, because of your bankruptcy, new limitations exist:

• You may have to wait two to three years before qualifying for a traditional mortgage or car loan.
• Bankruptcy will lower your credit scores.  Interest rates are likely to be higher until you build your credit again.

Future solvency

Obviously you need to create a solvent future.  You can begin by:

• Breaking bad financial habits
• Applying what you learned about wise spending
• Following a budget
• Setting aside savings
• Avoiding high interest credit cards

Jay Fortier is a Chicago bankruptcy lawyer who previously worked as a financial advisor for a large, national financial advisory firm.  He also serves as an associate real estate broker with Sky High Real Estate, INC and is a licensed REALTOR™.  His financial experience helps him guide clients to go beyond bankruptcy and understand how they became insolvent, helping them to plan for future solvency.

Ways to Avoid Bankruptcy

Although bankruptcy may seem like an easy way out of a financial mess, it brings a whole list of credit problems and inquiries for many years to come. Bankruptcy wreaks havoc with your credit for seven to ten years. If you are starting to feel financial stress, try to avoid bankruptcy by following some of these suggestions from the Boca Raton bankruptcy attorneys of Padula & Grant, PLLC.

- Avoid spending – This may sound easier said than done; however, excessive spending does cause many individuals to seek bankruptcy. Review your credit card statements for revolving charges that can be eliminated such as subscription services that are not necessary. If you do have the urge to buy something frivolous that you do not need, step back and rethink the purchase. Pay cash for necessities to avoid an increase in debt on your credit cards.

- Consolidation – Combine credit cards or transfer balances to avoid duplicate monthly interest charges. Speak to a credit counselor recommended by someone you trust like your bankruptcy attorney or accountant.

- Get help from your creditors – Remembering that you are not alone in financial duress can be comforting, and give you the courage to call your creditors and ask for help. Having a setback like a job loss or medical bills should be explained to your mortgage company and other creditors. They may be able to come to a solution for repayment options that will work for you.

If you follow this bankruptcy advice, as well as other ones recommended by a professional such as your accountant or a bankruptcy lawyer, you can possibly avoid bankruptcy in the future.

You have filed for personal bankruptcy and your case is moving forward. Now what?

Once you have filed for bankruptcy, you will need to adhere to any legal processes or payment plans set forth by the bankruptcy court. What these are and how they are handled will differ somewhat, depending upon whether you declared bankruptcy under Chapter 7 or Chapter 13.

Chapter 7 Bankruptcy Procedure

A trustee will be assigned by the bankruptcy court to administer your case and liquidate your nonexempt assets. If all of your assets are found to be exempt or already subject to valid liens, the trustee will file a “no asset” report with the bankruptcy court.

As your case moves forward, you will provide your trustee with financial records when requested. The trustee will, in turn, inform you of all the possible consequences of your declaration of
Chapter 7 bankruptcy, including its effect on your credit report and how the process will advance.

Anywhere from 20 to 40 days after your petition for Chapter 7 bankruptcy was filed, the trustee will hold a meeting with your creditors. You will need to appear at this meeting and answer questions, under oath, regarding your financial situation, property, and other information relevant to your case.

Ten days after this meeting, the trustee will make a report to the bankruptcy court stating whether they believe your case may be an “abuse” according to the means test required under current bankruptcy code. If the trustee says you do not meet the requirements of the means test, your bankruptcy petition will be denied, at which point you may be able to re-file under Chapter 13 or, if not, find another solution to your financial difficulties.

Once everything allowable has been sold off and the income distributed to your creditors according to their classifications, a discharge will be issued that releases you from personal liability for the majority of your remaining debts.

It is important to note that if you didn’t provide adequate financial records, satisfactorily explain any loss of assets, failed to attend required financial management courses, perjured yourself in any way, or otherwise committed bankruptcy fraud, you may be denied a discharge by the bankruptcy court.

Chapter 13 Bankruptcy Procedure

As in a Chapter 7 procedure, an impartial trustee is appointed to administer your Chapter 13 bankruptcy. The trustee evaluates the case and collects debts from you that are then distributed to your creditors.

You are required to bring any overdue payments on your home mortgage current over a reasonable time period, or risk foreclosure even after filing Chapter 13.

You will file your repayment plan with the bankruptcy court at the same time or within 15 days after your petition for Chapter 13 was filed. This plan must be Submitted by the court and provide for payments of certain amounts to the trustee according to a biweekly or monthly schedule. The trustee will use these funds to pay creditors according to the terms of your repayment plan.
Anywhere from 20 to 50 days after you file Chapter 13, your trustee will hold a meeting with your creditors, as described under Chapter 7. After the meeting, you and the trustee, along with any creditors who want to attend, will go to court for a hearing regarding your proposed Chapter 13 repayment plan.

You must start making plan payments to the trustee 30 days after filing Chapter 13, even if your plan hasn’t been formally Submitted yet by the court. You may also have to make secured loan or lease payments directly to these creditors if they come due before your plan is Submitted. Forty-five days or less after the meeting with creditors, a confirmation hearing will be heard at which the bankruptcy judge will decide whether your payment plan is reasonable and meets all the requirements stated in the Bankruptcy Code. Creditors are able to object to any terms with which they disagree and the judge will consider these objections when deciding whether or not to confirm your plan.

If your plan is denied, you may modify it and re-file at a later date, or convert your case to a Chapter 7 filing. There is a chance the court will deny the modified plan or refuse to let you file under Chapter 7 and instead dismiss your case entirely.

Once the payment plan is confirmed, your trustee will begin distributing funds as directed and it is up to you to help make sure the plan succeeds by making your regular payments to the trustee and avoiding any new debts that could interfere with your ability to meet the terms of your payment plan.

You will be entitled to a discharge once you have complete all of your payments according to your payment plan.

If you are unable to complete the payment plan because of changes in your financial circumstances, you may ask the court for a hardship discharge. A bankruptcy attorney can help you determine whether or not your change in circumstances qualifies you for a hardship discharge under Chapter 13.

Article presented courtesy of Todd B. Becker Riverside and Los Angeles bankruptcy lawyers, (800 946-6332), www.toddbeckerlaw.net.

Many people confronted by mounting debt and insufficient-to-no income consider a declaration of bankruptcy at some point. One of the major deterrents to actually filing is the fear that the person in debt (the “debtor”) may lose their home in the process. While this concern is not wholly unwarranted, in certain circumstances the opposite may be true — declaring bankruptcy can sometimes rescue a home from foreclosure. The key is to understand that there are different types of personal bankruptcy. You need to do some research and get advice from a legal bankruptcy expert to figure out which sort will save you from demanding creditors while not putting your home as risk.

Chapter 7 Bankruptcy (for Individual Debtors)

Chapter 7, also known as “straight” or “liquidation” bankruptcy is one option for wiping out the majority of a person’s debts. While it can also be used for business purposes, when it comes to individuals it is a viable option for those who are unemployed or otherwise have extremely limited incomes, while at the same time have debts for which they can barely meet the minimum payments (or make any payments at all). Any debts left over after the sale of non-exempt assets are usually forgiven, minus a few exceptions such as child support payments or most student loans. It is this form of bankruptcy that is associated with the potential loss of one’s home, as under this declaration, certain possessions are sold and the proceeds used to pay off their debts. The debtor’s property may have liens or mortgages placed against it during this process that effectively pledges their home to creditors. If the debtor otherwise pays off the creditor who has been granted a lien or mortgage on the debtor’s home, the debtor will remain in possession of their home. The Bankruptcy Code also allows debtors to claim exemption for certain property under either federal or state laws. Depending on the jurisdiction of your home state, you may be able to have your home classified as partially or wholly exempt (known as a “homestead exemption”), and thus out of reach of creditors. A bankruptcy attorney representing debtors in your home state can explain whether this exemption applies to you before you file, so that you know whether a declaration of Chapter 7 bankruptcy is a good risk or not.

Chapter 13 Bankruptcy

Chapter 13, also known as “wage earner’s” bankruptcy, is a good option for debtors who do not wish to risk losing their home under a Chapter 7 declaration. If you have a job or other source of relatively steady income, and are only seeking assistance in paying off your debts, Chapter 13 may work well for you. Under this form of bankruptcy, the debtor adopts a repayment plan that allows their loans to be repaid over a three to five year period. Chapter 13 bankruptcies can actually help you keep your home, in that they can be used to end any foreclosure action against your home and to eventually resolve any issues arising from delinquent mortgage payments. However, you will still need to make all mortgage payments on time even while following the Chapter 13 repayment plan. Your mortgage for your primary residence is not eligible for rescheduling under a Chapter 13 plan, nor can payments be spread out over the life of the plan (the way they can for other exempt items). In conclusion, any debtor that fears their home may be at risk if they file for bankruptcy should contact an experienced personal bankruptcy attorney before proceeding with any formal court action. There may be more choices for alleviating your debt situation which a lawyer can help identify and implement on your behalf.
Article presented courtesy of The Law Offices of Todd B. Becker in Riverside and Los Angeles bankruptcy attorneys, (800 946-6332), www.toddbeckerlaw.net.

People and businesses arrive at the decision to file for Massachusetts chapter 13 bankruptcy from many different paths. One point that they all have in common, however, is an inability to pay back their mounting loans.

If you are a debtor with little chance of paying your debts, then bankruptcy may be the best—if not only—solution to your problems. Whether you are filing Chapter 7 to completely liquidate debt, or Chapter 13, which will establish a repayment schedule, bankruptcy’s ultimate goal is to break the cycle of debt.

At the same time, bankruptcy is not without its own set of consequences and responsibilities: your personal credit score will suffer and you will have to demonstrate your ability pay back loans on time in order to improve your credit history.

If you need bankruptcy lawyers in Massachusetts contact DeBruyckere & Roth located at 1595 Lakeview Avenue
Dracut, Massachusetts 01826.

There is no definitive moment when your business must file for bankruptcy. The decision to file is personal. DeBruyckere, Roth & Associates can provide advice, but ultimately, the fate of your business rests in your hands.

If your debt that is accumulating at an unprecedented rate and creditors are constantly asking you for payments, then it may be time to pursue legal solutions.

Many companies, from corporate giants like General Motors to corner stores, seek bankruptcy when their businesses are no longer sustainable. A business bankruptcy can be understood as protection against creditors and an opportunity to restructure your company so that it can return to viability. If you need a bankruptcy attorney in Massachusetts contact DeBruyckere Roth & Associates for a consultation.