Bankruptcy

The truth about bankruptcy

editor — Mon, 08 Mar 2010 00:51:53 +0000

Whether or not to file bankruptcy is tough decision for many people but also sometimes it is a decision that makes itself. It is not an easy way out of your debt by any means, this is a long process and one that will cost you money to follow through on. When filing for bankruptcy you will need to hire a lawyer and they will take a look at all of your debt. They will also look at your income and financial situation. If you were someone who made a decent amount of money in the past and had experienced a change in your circumstance maybe from a company downsizing and you can no longer afford the debt you previously could afford you may be a good candidate for bankruptcy. If you make enough money to cover your bills then you most likely will not be able to successfully go through a bankruptcy. There are several types of bankruptcy and your attorney will advise which one would pertain to you. There was also a misconception about bankruptcy as most people believed it could only be filed once in your life time. This is not true, you can file for bankruptcy more then once but there are a certain amount of years you must wait before filing again. Depending on the type of bankruptcy you may be able to keep your home and basic assets. They will ask for a list of everything you own free and clear and determine if they will liquidate and attempt to pay something to your debtors. Bankruptcy will stay on your credit report for typically 7 to 10 years and can impact your ability to purchase a home, obtain credit cards and in some cases it can even effect your consideration for employment. Think long and hard if this is the only option for you because it is not an easy road.

Chapter 13 Bankruptcy

editor — Fri, 05 Mar 2010 03:46:08 +0000

If you file a chapter 13 bankruptcy, you are agreeing to pay your debts back at a monthly amount which will be determined by a trustee that has been appointed to you by the bankruptcy court. You will need to see a lawyer that practices bankruptcy law. The difference between a chapter 7 and a chapter 13 bankruptcy is the amount of debt that you owe and your ability to repay the debts. If your income is too high and the amount of debt you have is high (but not high enough) to qualify for chapter 7 then, if you decide to file, it will have to be a chapter 13 bankruptcy. You will have to prove income, debts and reveal all your financial assets. You will keep what you own and continue to pay a set amount monthly. This is usually for a period of 5 to 7 years. You will not be able to buy or sell anything without the permission of the trustee appointed to your case. Any income tax or other monies that you are entitled to will be taken to pay towards your debts. Many people decide to deal with the creditors themselves and try to work out a payment that satisfies everyone, rather than lock themselves into a 5 to 7 year time frame where they have to have someone’s permission to buy or sell anything. Explore your options before you commit to filing bankruptcy in any form. It basically ruins your credit for a period of up to 10 years, and limits your ability to purchase things like a car or a home.

Bankruptcy Basics

editor — Wed, 24 Feb 2010 21:38:02 +0000

What a blessing and a curse at the same time. It is a blessing as it allows you to get out from under the debtor stress and a curse because it has to be used at all.
Really it is a way to reduce the burden of debt by legal means. There are a few chapters to this book called Bankruptcy. There is chapter 7. What a chapter! This chapter allows the courts to take certain belongings and resale them. When they get the money back they divide it up between the people you owe. This supposedly frees you from the debts That is like reading one of those old English novels about the Lords losing their estates and joining the regular people. The other great chapter is chapter 13. This chapter has a bit more dignity. It sets up payment plans so that you can pay back your debts over a period of time. It is all relative to what you own and how much you make. It is not a good situation but, at least it exist for those with that necessary hardship. There is no shame in it. Millions of people go through it on the earth each year. Not just here in America, it is happening anywhere that English law prevails. Bankruptcy is not something anyone enjoys. Sometimes it becomes the necessary between two evils. Thank goodness for it here in America. Without it, there would be so much more woe and worry. You would have creditors walking through your living room lifting all of your belongings, breaking your fingers and legs for a payment. It would be absolutely ridiculous. Like we need more woe and worry over economics. Bankruptcy is what, a blessing and a curse. It is also a legal procedure.

Filing Bankruptcy is Harder

admin — Tue, 09 Feb 2010 19:57:41 +0000

Many people get in over their heads with debt and will find themselves in a situation where they might be thinking about filing bankruptcy. Up until 2005 this was an easy task for people to do and then the law was changed. The law was changed in order to hold people more liable for their debt. When a person is getting ready to make the decision to file bankruptcy they need to know that they might only be able to file Chapter 13 and not Chapter 7. By the person being eligible for a Chapter 13 they will have to pay back as much as possible of the debt they have made. They will be given 2-5 years to pay the debt off. A person will also be required to take 90 minutes of credit counseling and a money counseling course so they will learn how to manage their debt. Each state has a guide line to follow in order to see what the person is eligible for to file when claiming bankruptcy. Each state now has a median for comparing a persons income and debts to. If a person is above the median and can use a quarter of their income to satisfy the debt then they will only be able to file Chapter 13 bankruptcy. If a person falls under the state median and cannot use a quarter of their income to pay back the debt then they would qualify for a Chapter 7 filing. There are many other things that a state will take into account when a person is filing for bankruptcy. The state will look at how long the person has been a resident of the state for which theyre filing in. Even though the new law is stricter people can still file for bankruptcy.

Understanding the New Bankruptcy Law

admin — Tue, 02 Feb 2010 17:35:00 +0000

On October 17, 2005, a new bankruptcy law went into effect. The purpose of the bankruptcy was to restore some fairness into the bankruptcy law in terms of who could qualify. Congress had become convinced that many people were taking advantage of the system under the old law in order to get out of paying debts they could afford to repay. The new law makes it more difficult to qualify for a bankruptcy, but it also places a heavier responsibility on the bankruptcy attorney. The new bankruptcy law changed the old law in several important areas. For one thing, the new law resulted in more people qualifying for a chapter 13 filing rather than a chapter 7 filing. Under the chapter 7 filing, all of the debtor assets are liquidated and used to repay the creditors. In many cases, debtors have no assets except their house or car and so the creditor gets very little or nothing. A chapter 13 filing is a repayment plan which forces the debtor to repay as much debt as possible between 3 to 5 years. The new bankruptcy law also established new calculation rules and made it more difficult to use the homestead exemption. The new calculation rule uses the IRS standard of living numbers to determine your net income figure. The IRS living standard amounts usually are often lower than what you actually spend. The homestead exemption refers to the fact the new law has placed greater restrictions on which state exemption you can use as determined by your length of residence. A bankruptcy attorney will carefully determine the status of your homestead exemption during the filing process. Another addition to the new bankruptcy law is the requirement that debtors take a money management course and get 90 minutes of credit counseling. This process has been streamlined in that there are many ways to fulfill these requirements online. One of the major changes in the new bankruptcy law is the establishment of an income means test. The means test is how the courts will determine if you should be allowed to file a chapter 7. Under the means test, your income will be compared to the state median income in the state in which you live. Then your income will also be used in a formula that will determine if you can pay at least 25% of your net income to pay off unsecured debt. If you can, and your income is over the median, then the court will probably make you file a chapter 13 unless you can prove you have unusual circumstances. This is just a quick snapshot of the new bankruptcy law changes effective October 2005. Of course, there are many other complex aspects to the law that only an attorney is qualified to interpret. Though the new law is more stringent than the old, it still gives millions of people a fresh start. gmac bankruptcy

Chapter 7 Bankruptcy

editor — Thu, 28 Jan 2010 03:49:52 +0000

If you find that you are in need of having to file bankruptcy, you will need to know what ‘chapter’ you are going to be able to file. Chapter 7 enables you to write off almost all of your debt, providing you are able to prove that you are no longer able to pay due to lack of income or some other circumstance. Make an appointment with a lawyer who specializes in bankruptcy law. Your first step is to gather all your financial information. List all your debts, the creditors, their addresses, and the amounts owed. List all of your assets and the amount that you think they are worth. This would include any jewelry, clothing, furniture, and so on. Your lawyer will also require proof of your income and your tax returns from the previous year. List the amount of money that you pay out each month for utilities, groceries, gas, entertainment, clothing and any other incidentals. Your financial status will be an open book. Leave nothing out. Discuss with your lawyer about anything you wish to withhold from bankruptcy, such as your home or vehicle. These debts will have to be what is called reaffirmed, meaning that the financial institution that holds the debts will have to be notified that you are not including these debts in your bankruptcy filing. You will also have to appear in bankruptcy court with your lawyer and swear under oath that everything concerning your financial status is true and correct.( Sometimes (not often) someone from one of the companies that you owe money to will also appear to dispute this filing.) Your statement will be recorded by the trustee appointed to hear your case. He will ask you a few questions, and then you will be finished. If your debts are discharged you will be notified by mail in a few weeks.

Do it Yourself Bankruptcy

editor — Mon, 25 Jan 2010 02:19:59 +0000

So you decide to declare bankruptcy and contact several companies to inquire about filing only to be told you must pay up to $3000 to file bankruptcy. Forgive me but if your already in DEBT it maybe hard to come up with the money to pay this. Did you know that if you don’t have any property, businesses, or other complicated assets that you can do your bankruptcy yourself. When you file bankruptcy yourself the only fees you pay are the actual filing costs with average around $300. You can pay this $300 in installments but your case can not be discharged until you have paid the complete filing fee. To get started first you must obtain a copy of all 3 of your credit reports to ensure that you have all the accounts you want to include on your bankruptcy. Next you download the appropriate blank bankruptcy packets complete with instructions. Follow the instructions to ensure that you include all the necessary information they ask regarding your personal information and information regarding your creditors.

After your packet is complete go online to find the closest Bankruptcy court to your home. Contact your local office to get the exact requirements for filing in your district. Once you find the location you can take your bankruptcy packet to the filing office. They will process your paper work and then you get a court date. This is only recommended for consumers who don’t have a huge amount of debt but are still considering bankruptcy.

Getting a Fresh Start with a Chapter 7 Bankruptcy

admin — Tue, 19 Jan 2010 08:13:12 +0000

You can think of a chapter 7 bankruptcy as a fresh start with a life not overburdened with unmanageable debt. The chapter 7 was designed just for the individual debtor and is used to discharge certain eligible debts. When the court discharges the debt it means you no longer have any responsibility for the liability. Not all debts can be included in this type of bankruptcy filing, but for many people that dont have any of the exempted debts, this bankruptcy literally allows them to start with a clean debt slate. The chapter 7 bankruptcy should be handled by an attorney who is a specialist. Though the chapter 7 filing is one of the less complicated filings in many cases, there are still specific and complex laws governing how the process will be handled. The reason it can be less complicated is only because many people filing a chapter 7 are dealing with the normal types of debt such as mortgages, credit cards and past due taxes. Of course, this doesnt hold true for everyone, but for many people the chapter 7 filing turns into a fairly simple process. But even in the simple cases, the right forms must be filed and the laws followed. For example, the bankruptcy attorney must submit a petition to the court requesting the bankruptcy along with certain financial schedules detailing your income and expenses. The court is also given a copy of several years worth of tax returns. When you and your bankruptcy attorney decide to file a chapter 7 bankruptcy, you have to complete a credit counseling course. In most cases, you can complete an online course now which makes it very easy to fulfill the court requirements. There are some filing fees which must be paid to the court also, but if you cant afford the fees, the attorney can ask the courts to allow you to pay the fees in installments. Under the chapter 7 bankruptcy laws there are certain assets which are considered exempt property. In fact, individual states are allowed to define this exempt property too, so your attorney can pick the most lenient definitions which will give you the most relief. This is why you need an experienced bankruptcy attorney. When the bankruptcy is filed, you will find that the debt collection efforts stop quickly. In legal terms, this is called an automatic stay and it stops telephone calls, garnishments, levies, lawsuit filings and so on. This is another reason why it is critical that you list every single creditor in your life on your financial schedule. Even if you are not sure you owe the debt, it should be listed to prevent future collection efforts. The court is going to appoint a trustee to handle your filing. The trustee will hold a creditors meeting which gives your debtors the opportunity to explain why they do not believe the debt owed to them should be discharged. The trustee can also ask you questions about anything you included on your financial statements. A chapter 7 bankruptcy is a way for people unable to pay their debt to clear the slate and start fresh. It is a major decision to file bankruptcy, but this is a decision that can give you the opportunity to start a new long term financial life. michigan bankruptcy

Credit Counseling as a Bankruptcy Alternative

admin — Wed, 13 Jan 2010 06:22:36 +0000

Sometimes it is possible to seek a bankruptcy alternative through credit counseling. It is feasible to get deeply in a debt, but be able to avoid bankruptcy when certain conditions exist. First and foremost, if you earn enough income to pay your current monthly expenses and your debt payments, but have fallen behind because of high interest rates or a one-time financial emergency, then it might be possible to avoid bankruptcy. Also, if your secured debt such as your mortgage and car payments are current and it is the unsecured debt wreaking financial havoc, then credit counseling may be a good choice. There are plenty of other good reasons why you might consider seeking credit counseling. You can find many different types of credit counseling agencies, nonprofits and for-profit businesses. You should be very careful about the company or agency you choose, because some of them charge high fees. That means a significant amount your monthly payment would go to pay fees and not your debt. The best place to start when looking for a reliable and experienced credit counselor is with a bankruptcy attorney. You should meet with the bankruptcy attorney in order to determine if credit counseling is even the path you should pursue. Credit counseling is usually only suggested instead of bankruptcy when two conditions can be met. First, you have to be able to budget your money and adhere to a repayment plan. Second, you only need to get interest rates lowered on unsecured and maybe some of the secured debt in order to get your payments lowered. Credit counseling involves listing all of your income and debts. You are assigned a counselor who then contacts each of your debtors. In most cases, high interest rates on credit cards can be reduced and the credit card companies agree to accept lower payments. In some cases, even secured debt payments can be lowered, because a company would rather not repossess personal property if at all possible. Normally though, only unsecured debt is included in the repayment plan. Once the counselor has obtained the new payment amounts, a total monthly sum payment is calculated which includes a fee. You then pay that one amount to the credit counseling agency which distributes the payments to the credit card companies or other debtors. For many people, credit counseling offers a bankruptcy alternative. You are able to avoid filing a bankruptcy that remains on your credit records for 10 years. The credit management services are often able to negotiate lower interest rates so you can restore your financial health. It’s always best to avoid bankruptcy if possible, but when you need to actually reduce your debt, rather than just the payments, then bankruptcy is the best solution. A bankruptcy attorney can review your financial status and advise you as to the best course of action. for bankruptcy protection

Looking at the Forms Bankruptcy Can Take There are many types or forms bankruptcy can take

admin — Thu, 07 Jan 2010 12:02:49 +0000

Looking at the Forms Bankruptcy Can Take There are many types or forms bankruptcy can take
Looking at the Forms Bankruptcy Can Take There are many types or forms bankruptcy can take. The US bankruptcy laws are designed to help individuals, businesses and even municipalities that are having severe debt problems that appear to be unsolvable within the current income or revenue levels. There are many reasons why this happens, but the reasons seem unimportant when buried under a mountain of debt. As many people discover when bills become backlogged, debt collection practices are harsh. The phone rings off the hook with collectors, and the late notices and penalty charges only seem to make the situation worse by the day. When you owe back taxes, the IRS is relentless when it comes to collecting the money. The forms of bankruptcy are defined as chapters. The chapters were written to provide a specific form for filing when you are an individual, farmer, business, or municipality. Most people are aware of the availability of bankruptcy laws applicable to people and businesses, but even counties and cities can find themselves unable to pay their debt. Right now there is a current case in Alabama in which a county cannot pay its sewer bonds and is considering filing bankruptcy. The first form bankruptcy takes for individuals is chapter 7. A chapter 7 is a liquidation bankruptcy in which your non-exempted assets are used to pay off as much debt as possible and the remaining balances are eliminated. A chapter 13 is called an individual debt adjustment form. In this case, an individual agrees to a court defined debt repayment plan. Another form bankruptcy can take is chapter 11 which is a business reorganization plan. Under this chapter, the business asks for the debt to be adjusted in a way that makes it workable. The business can also ask for a total reorganization which is often what you read about large corporations doing in order to stay in business. Farm businesses, on the other hand, will file a chapter 12 when needing debt relief. The other types of bankruptcies are chapter 9 for municipalities and chapter 15 for ancillary cases or cases which don’t fit the other defined chapters. There are even bankruptcy laws that address service people who are unable to pay their debts because they are overseas serving their country. It is easy to see how complex the bankruptcy codes really is and it is a work in progress too. Every day new court cases refine the code based on actual experiences. A good bankruptcy attorney will always stay current on the laws so that you are able to get the best advice possible. The goal is to help you or your business start over again financially, but in a way that is the best fit for your situation. bankruptcy attorney in los angeles