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Mortgages can be cancelled in a process called rescission. Here’s an overview. Grounds for exercising this right given borrowers by Congress are found in problems with the mortgage closing documents for a residential second mortgage or refinanced mortgage.
Problems include the absence of Truth In Lending Disclosures, such as the Annual Percentage Rate (APR) for [...]
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Borrowers have three days to cancel a mortgage after signing the papers. That three days is extended to three years (four years in Massachusetts), if the papers have certain problems. The extension can even be forever, meaning that it can be used as a defense called recoupment, to oppose a foreclosure.
Cancellation is also called rescission. [...]
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The government’s accountability office reports a 50% increase in the cost of bankruptcy. A large part of the increased expense can be traced to the means test, that supposedly objective measure of whether an individual has the ability to repay his creditors some of the debt he owes.
On this site, Kurt O’Keefe looked at [...]
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Massachusetts Bankruptcy Judge Rosenthal in the recent case in re Zmijewski, 2008 WL 2705508 (Bankr.D.Mass.2008), added a decision to the many dealing with trusts and homesteads in Massachusetts. The Chapter 7 debtors, before their case was filed, conveyed real estate to a self-settled trust. The debtors were sole trustees and beneficiaries. However, they [...]
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Bankruptcy laws were massively changed effective October 17, 2005.
One of the selling points, was that too many people were filing, and this cost the rest of us $400 per year, because our cost of borrowing was higher to cover the losses from all those deadbeats filing Chapter 7.
Well, the credit card company losses were [...]
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No! Objections to claims do not need to be served in the same manner under Bankruptcy Rule 7004 as Adversary Proceedings. This is because even though an Objection to Claim is a Contested Matter generally covered by Bankruptcy Rule 9014, the claims objection process is further governed by Bankruptcy Rule 3007.
The Law is well established [...]
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Jacksonville bankruptcy attorney Robert Wilbert is accustomed to giving away his legal expertise as a staff attorney for Jacksonville Area Legal Aid, but the free service he provides thousands of his colleagues is just as priceless.
Since the enactment of The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) in late 2005, practicing consumer bankruptcy law has become [...]
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So your attorney objected to a claim and got it disallowed in your Chapter 13 case. A year later, the creditor decides to move the court to reconsider the claim. Can they do this?
While the Creditor can file a motion for reconsideration at anytime(yes there is no law that it be done within a certain [...]
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It seems to be happening more often these days. A bankruptcy case is filed, the law firm for the debtor pursues a debt scavenger for illegal behavior, and the debt scavenger then agrees to certain terms to resolve the illegal behavior, but conditions the same on a provision that the attorney or their law firm [...]
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Kansas City, Missouri Bankruptcy Law Attorney Rachel Lynn Foley her article on this site, Do Not Lie To The Bankruptcy Court speaks about the potential criminal results of lying in a bankruptcy.
Delay of the discharge of your debts is a less, but also important, potential result.
One way to delay your discharge (and to cost you money) is falsify the information [...]
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I am not sure why but almost every case I file the debtor will ask me, “How will the judge know I am telling the truth?” You file your bankruptcy petition and schedules under penalty of perjury.
If you lie, the FBI will investigate the crime and if found you are found guilty you will [...]
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Federal tax law allows an individual debtor in bankruptcy to cut off their tax year as of the date before filing a Chapter 7 or Chapter 11 bankruptcy if there are assets in the bankruptcy estate. As I discussed in a prior article, the election, allowed by 11 USC §1398, must be made by [...]
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In an interesting article on Yahoo Finance entitled: “Four Ways to Get That Burdensome Debt Paid Off”, authored by Marshall Loeb, makes several very good suggestions on how to get rid of your debt.
Three of his suggestions, pay more than the minimum balance due every month, use savings to buy down your debt, [...]
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Bankruptcy law is complex. Even “simple” and straightforward Chapter 7 cases require a great deal of information along with calculations that are not at all intuitive.
Prior to the 2005 BAPCPA changes to the bankruptcy law a reasonably intelligent, careful person could find a bankruptcy “how to” book at the library and write out schedules that [...]
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Because of the 2005 Bankruptcy Reform Act, special timing considerations are now present in nearly every bankruptcy case. Even if your lawyer has not specifically told you about this, you may have noticed that there is an urgency to gathering the documents and other information which is necessary to complete the filing of your [...]
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On July 8, 2008, California enacted SB 1137 to deal with the mortgage crisis. This legislation supposedly was an attempt by the State of California to cut down on the numerous foreclosures arising as a result of real estate loans issued from 1/1/03 to 12/31/07.
The law essentially provides that a Notice of Default (NOD) may [...]
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Frequently, debtors are harassed by creditors prior to the filing of their bankruptcy case. Is there a way to prevent creditor harassment and contact in California? Can a debtor stop all future communications from the creditor?
If the debt is for consumer purposes (for personal, family, or living expenses), then there are effective ways to end [...]
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Frequently Debtors ask why their Bankruptcy Fees are different than the fees of someone else they know. Is there a reason for this? After all, the filing fees are the same, so why should the attorney fees be any different?
Actually, the filing fees are different. Chapter 7 presently has a $299.00 filing fee and Chapter [...]
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“Mrs. Smith, please hand your car keys over to your attorney. You are not allowed to drive that vehicle until you provide me evidence of insurance. I suggest you take the bus home and make arrangements immediately to protect and store that vehicle.” Such a statement might come from a Bankruptcy Trustee at the Trustee [...]
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At a recent meeting of creditors, I was approached by a woman who asked me if I could point out her lawyer so she could meet him before she had to go before the trustee and answer questions about her case. I asked her if she had ever met her bankruptcy lawyer before, and [...]
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As a Consumer Bankruptcy Attorney, I meet with individuals seeking bankruptcy information everyday, and I answer their questions about their financial situations. Sometimes they are individuals, but the majority of the time I meet with husbands and wives, and I prefer it this way. I can usually tell who made the consultation and [...]
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Sometimes one tax year in a 12 month period is just not enough! Think of all the fun that could be had if there were two. When it comes to bankruptcy, Congress agreed with that principal. An individual is allowed to split the tax year into two short years in certain types of bankruptcy proceedings. Internal [...]
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Perhaps the most difficult part of a Chapter 13 bankruptcy is getting the plan confirmed. The court has to approve the proposed plan.
There are several common reasons why the court might not approve a proposed plan. It might be infeasible – the schedules put into question the ability of the debtors to make the intended [...]
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You might be wondering if filing bankruptcy without your spouse is a good idea. The answer depends on whether your spouse has significant debts to discharge in a bankruptcy, and whether your spouse is responsible for the debts you intend to discharge in your case.
If you live a community property state, generally your spouse [...]
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The National Association of Chapter Thirteen Trustees (NACTT) has developed a new vehicle for education of bankruptcy professionals as well as the general public. The NACTT Academy, a separate non-profit entity, was created by NACTT to collect and publish educational materials on matters relating to proceedings under Chapter 13 of the US Bankruptcy Code.
The NACTT [...]
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Sometimes a chapter 13 case is filed, instead of chapter 7, due to concerns over possible non-dischargeability complaints. Perhaps the debtor has incurred large credit charges or balance transfers recently, or maybe he or she owes a large debt to a creditor who might claim fraud, or a wilful or malicious injury. If there are creditors who are [...]
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Although bankruptcy laws are federal, there can be some critical differences in how the law is interpreted from place to place, and in how state laws affect bankruptcy. So if you are planning to move, or you have just completed a move, the place you file bankruptcy can make a big difference in your outcome.
Venue–a [...]
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Chapter 13 repayment plans can, and sometimes have to be, five-years long. Once again a court has reaffirmed that bankruptcy law allows those long-term plans to be shortened if the circumstances justify it.
Americans are funny people. We agree to buy a house on 30-year mortgages and often refinance those loans into another 30-years [...]
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In the recent case of In re Dufa,Case No. 07-60743 Judge Federman ruled that since the debtors moved to Missouri on the 730th day before filing their bankruptcy petition they were required to use the Missouri exemptions to protect their assets. Judge Federman looked to the Bankruptcy Code to base his decision. [...]
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I keep many financial advice books and DVDs in my office library to recommend to clients, but Suze Orman is not on my list of recommended authors. When she gets things right, she can be quite good, but when she is wrong she can get it wrong.
Until Suze Orman gets a basic understanding [...]
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Several people have called me recently, saying that they wanted to file for Chapter 7, but couldn’t because their income was too high. In most cases, however, a high income–even one significantly over your state’s median income–doesn’t automatically disqualify you from Chapter 7. I’ve personally filed Chapter 7 cases for people who have incomes over [...]
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What are the repercussions for a partnership if one of the partners has to file bankruptcy? A couple of days ago I wrote a post on filing bankruptcy if a partnership fails. But what if the partnership is still in business but one of the partners needs to file bankruptcy. What is [...]
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On July 1, 2008 the much anticipated District Court decision in the Jones v. Wells Fargo case was released.
In her decision, District Judge Helen G. Berrigan affirmed the judgment of Eastern District of Louisiana Bankruptcy Court Judge Elizabeth Magner on all but one issue, and remanded that issue for further consideration.
In what can only be called [...]
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My previous blog generally outlined the time frame of a typical foreclosure in California. This blog provides an illustration of how that time frame works in a typical case.
The following example illustrates the typical foreclosure in California where a debtor files for bankruptcy protection and stopped making payments on January 1, 2008. As illustrated, the [...]
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Debtors always ask how much time they will have to live in their home if they intend to surrender it in their Bankruptcy Proceeding. If you live in California, you will find this blog useful. Generally speaking, expect to live there at least a year without making any mortgage payments!
Generally, the foreclosure process in California [...]
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Partnerships, like many other businesses in this economy, can fail too. What are your options when the debts of the business exceed its assets?
Unlike a corporation, a partnership lacks the “shield” between its owners and its debts. Legally, it is more like a sole proprietorship (but one owned by more than one person). The individual [...]
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In 2005, the changes to the Bankruptcy Code known as BAPCPA were adopted by the Congress. Previous articles discussing the candidates’ positions on BAPCPA may be found by reading Barack Obama on BAPCPA, Obama vs. McCain on Bankruptcy and Barack Obama on Bankruptcy/Credit Reform. Before the bill was passed, however, there were a number of [...]
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In or out of bankruptcy, climbing gasoline and food prices are having a huge impact on everyone. Many of my new bankruptcy clients were pushed over the edge by rising cost of living. Many current Chapter 13 bankruptcy clients are having problems in their current Chapter 13 bankruptcy cases when [...]
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In my previous articles, Obama vs. McCain on Bankruptcy and Barack Obama on Bankruptcy/Credit Reform, I examined the positions of presumptive presidential candidates Barack Obama and John McCain on the 2005 amendments to the Bankruptcy Code, commonly known as BAPCPA. Since writing those articles, I came across Senator Obama’s comments about the bill made before [...]
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Creditors these days are looking for any and all ways to prevent debtors from discharging their debt in bankruptcy. As a result we are seeing more and more allegations of fraud.
The most common fraud allegation from the creditor is that you, the debtor, charged on a credit card and made absolutely no payments or [...]
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Our primary goal at Bankruptcy Law Network is to increase the amount of information available to you, the American consumer, about debt relief options. Now the National Association of Chapter 13 Trustees has launched a new portal designed to help consumer bankruptcy practitioners learn more at www.ConsiderChapter13.org.
The National Association of Chapter 13 Trustees devoted significant [...]
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One year ago, I posted a blog on this website discussing some of the ways that the bankruptcy law was applied differently in different locations throughout the country. In that blog I discussed the fact that states had vastly different exemption laws, and that in some states a debtor in bankruptcy could protect an [...]
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Under the former bankruptcy law, unsecured creditors in a Chapter 13 were paid only after all secured and priority creditors were paid in full. Under the new bankruptcy law (BAPCPA), Congress imposed a new formula for determining the minimum amount unsecured creditors would be paid in a Chapter 13 for debtors who were above [...]
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Each state has their own laws about what funds deposited in bank accounts are exempt and protected from creditor attachment. In New York, while Social Security and other exempt funds are protected, if a person’s bank account contains “co-mingled funds”, the creditor can attach the money deposited in the account. This is a [...]
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The most experienced and knowledgeable bankruptcy attorneys try to stay current with the latest bankruptcy court decisions and with the local and national trends that are most affecting their current and potential future clients. To do that, we refer to several sources. One, of course, is keeping current with the postings on bankruptcylawnetwork.com, [...]
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It comes up at almost every initial meeting with a prospective client–if I’m bankrupt, how do I pay for bankruptcy?
Many folks who worry about paying for bankruptcy, and think they’ll never be able to afford it miss the obvious–if you are going to resolve your debts by filing bankruptcy, you may be able to stop [...]