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“The US health care financing system is broken, and not only for the poor and uninsured” According to a recent study in The American Journal of Medicine, middle-class families are collapsing under the strain of “a health care system that treats physical wounds, but often inflicts fiscal ones”.
The study, (http://pnhp.org/new_bankruptcy_study/Bankruptcy-2009.pdf) claims that 62.1% of all bankruptcies filed [...]
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“I don’t want to file bankruptcy on my house!” “I don’t want to file bankruptcy on my car!” “I owe my mom some money but I don’t want to file bankruptcy on her!”
Every bankruptcy attorney practicing in this country has heard these phrases or variations of them. The client wants to keep his home so he thinks [...]
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Although filing Chapter 7 bankruptcy usually wipes the slate clean as far as most of your debts are concerned, there are some debts that may not be discharged.
Certain debts, such as most taxes, child or spousal support, and student loans usually survive the Chapter 7 discharge. Debts incurred through fraud, may also survive the discharge. And in [...]
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When you file for bankruptcy you are required to file certain documents - your bankruptcy petition, bankruptcy schedules, and a host of other papers. These papers must all be completed accurately, honestly and completely.
You do not get the option of filing blank forms “just for now.” If you do, the bankruptcy trustee or [...]
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On Friday, June 26, 2009, Governor Ted Kulongski signed HB 2306, which provides increased protection for a debtor to protect his vehicle and his home from creditors. Formerly, a debtor could protect $2150 in value of a motor vehicle. The bill amends Oregon Revised Statute 18.345(d) motor vehicle exemption value up to $3000. Oregon has [...]
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Your Credit Score can be an important asset. It determines your ability to get credit, and the cost. It could be a factor in your getting a job, renting an apartment, and purchasing a house or a car. When you file a Chapter 7 bankruptcy, your credit score will be affected. In some cases, however, it’s [...]
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Preparing the paperwork to file a bankruptcy is, generally, the next step after you have hired an attorney, met with him to discuss your options, and provided him with all of the information requested.
The initial paperwork for a chapter 7 bankruptcy consists of the petition; the schedules and the statement of financial affairs. Additionally, there [...]
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Dairy farmers in Upstate New York are facing a crisis. While the cost of milk at the grocery store continues to climb, the price dairy farmers receive has not. Farmers are currently receiving $13.33 per hundredweight. This is $4.25 below the cost of production in New York, even in the most efficient dairy farms. Even the safety [...]
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You may have purchased something from a company now in bankruptcy, and you have to make a warranty claim.
If the company is in Chapter 11, it will very likely honor your claim for the good will it generates (you’ll tell your friends that it’s okay to do business with the company) even though the company [...]
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When an insurance policy pays a damage claim for a totaled car that is involved to a chapter 13, the bankruptcy trustee is required to hold excess money over the amount of the lender’s secured claim according to In re Feher, Southern District of Illinois case Bankruptcy Number 95-30444, Adversary Number 96-3133. Consequently, the money [...]
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In the Southern District of Illinois Bankruptcy Court, one option permits the insurance company to pay the money directly to the car lender. Another option lets the debtor use the proceeds to purchase a substitute vehicle.
The insurance money is property of the bankruptcy estate under contractual terms that make the money payable to the debtor, [...]
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Filing for bankruptcy can be confusing, especially when you don’t have all of your documents prepared. Learn more about what documents you need to have on hand when you meet with your bankruptcy lawyer by listening to this audio segment.
If you liked that post, then try these...8th Circuit Strikes New Bankruptcy Law As Unconstitutional [...]
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Your homestead exemption is one of the most important benefits you get when you file for bankruptcy. It protects your residence. In New York, you can protect up to $50,000 of equity in your home, $100,000 if you file together with your spouse.
You usually get to take the homestead exemption if the property is [...]
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As my friend and colleague, Cathy Moran explained in her blog over a year ago, the benefits of filing a bankruptcy mean that the debtor provides information to the bankruptcy court in the papers filed with the court.
This benefits the debtor more than the Court–this honesty. For full disclosure, the debtor is able to rid [...]
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If 2nd Circuit Judge Sonia Sotomayor gets to sit on the US Supreme Court, she will likely give all parties a fair opportunity to be heard, and ensure that the rights of all parties, debtors and creditors alike, will be respected. This is the prediction from the Alliance for Justice “Report on Supreme Court Nominee [...]
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Choosing a bankruptcy lawyer can be difficult - you want to get the right help, but can’t figure out what’s important. Listen to this audio session to get some answers.
If you liked that post, then try these...Bankruptcy Filings Nearing Million by Jill Michaux, Kansas Bankruptcy AttorneyBAPCPA and the Rule of Unintended Consequences by [...]
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For many years, it was questionable whether a debtor who filed for chapter 7 relief was able to keep expensive real estate at the expense of paying other creditors. At least 5 cases have come down since the new laws passed in 2005 that held that such high expenses related to residences was an “abuse” [...]
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If your Chapter 13 payments are set by the Means Test and not only by mortgage and priority tax arrears, then a Family Medical Leave can reduce your payments.
The Means Test looks at your average monthly income for the six month period ending with the month before your filing. If you have not yet filed [...]
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Should you file a Chapter 7 bankruptcy or a Chapter 13 bankruptcy?
The answer to the question of what type of bankruptcy to file is that it depends on your financial circumstances.
A Chapter 7 bankruptcy and a Chapter 13 bankruptcy are really designed for two different types of debt situations.
A Chapter 7 bankruptcy, which is often referred to [...]
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The United States District Court located in San Diego recently issued an opinion on December 10, 2008, holding that student loans may be discharged in chapter 13 bankruptcy cases where the creditor fails to object after receiving proper notice. Other cases around the country are also holding the same and the United States Supreme Court [...]
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What happens when you cannot make your Chapter 13 payments due to unexpected bills? A furnace goes, or a car breaks down, or you get sick or hurt. What then?
There are a number of options. None of them are “Keep this secret from your lawyer!”
You can ask for a suspension, or moratorium of payments and [...]
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Filing Chapter 7 bankruptcy will stop collection efforts of your creditors, however that relief may be temporary if your debts are of the kind that are not discharged in bankruptcy.
Some debts, like student loans, child support, many taxes, and a few others, are not discharged by bankruptcy. However you may experience some relief from their collection for [...]
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My client’s business corporation is long dead and he’s back to working for others. But six quarters of unpaid corporate payroll taxes not only become his personal debt, but a tax that is never dischargeable in bankruptcy and a priority claim which must be paid in his Chapter 13 case.
It is so tempting for the [...]
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Courts may grant a Motion for Relief from Stay in a Chapter 7 if it was filed because a debtor is behind on the mortgage when filed, and there is no equity in the property for creditors. Chapter 7 is not designed to stop foreclosures to give people time to catch up on their mortgages. [...]
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Clients frequently ask us if they must be a citizen of the United States to file a bankruptcy case in the United States. No - you don’t have to be a citizen to file a bankruptcy case in the United States.
You do have to be a resident of the place where you plan to file [...]
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The Southern District of California Bankruptcy Court in San Diego recently issued a ruling that allowed a junior lien to be removed in a Chapter 13 case, even though the debtor was not eligible to obtain a discharge. Discharge was not available since the debtor previously filed a chapter 7 petition and the new bankruptcy laws [...]
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Clients frequently face debts from countries other than the United States. If you file a bankruptcy case in the United States, what is the effect on your debts from overseas?
We tell clients not to worry too much about this. First of all, it takes some effort for a foreign creditor to make its judgment enforceable in [...]
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Creditors can argue that your case should be dismissed for abuse, a term not defined in the Bankruptcy Code; It generally means that you’ve been a bad boy. There’s a presumption of abuse when you flunk the Means Test and show that you have means to pay some of your debt. Abuse might also exist [...]
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In June, people’s thoughts turn to marriage. These days, people’s thoughts also turn to bankruptcy. Clients ask me, “Should I file my bankruptcy case before my wedding?” It’s a good question.
The answer is not always simple. Why should it matter? The main reason is the “means test.” The Bankruptcy Code says that you are presumed [...]
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I often find that when asked about their insurance, my bankruptcy clients tell me that they are “covered by insurance from the mortgage company.”
Bankruptcy or not, be very clear about this: if your insurance lapsed and you were notified by your mortgage company that they have obtained insurance for you, this insurance covers their loan [...]
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Good news for California Homeowners who are in default on their mortgages. On February 20, 2009, Governor Schwarzenegger signed ABX2 7 and SBX2 7. These new laws provide additional time for borrowers to work out loan modifications who are presently facing foreclosure. This law went into effect June 15, 2009.
Essentially, Civil Code Section 2923.52(a) now requires [...]
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Senior citizens with fixed incomes frequently think about filing for bankruptcy. Even though we have experienced a horrible mortgage meltdown, many retired people have actually paid off their houses and, at least in theory, still have equity. Yet their social security income is not enough to live. Even worse, many pensions have been cut back [...]
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It often happens that a creditor gets a judgment against you before your bankruptcy case is filed. That judgment is erased by the filing, unless it’s a type of debt that isn’t discharged anyway (fraud, theft, intentional injury, and the like).
This doesn’t automatically mean that you need to file a bankruptcy case. You may be [...]
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Ever wonder how a bankruptcy court would rule, if you actually had a hearing on the question of how much a car is worth in chapter 13? Did you doubt you could really get a court to reduce the amount of the secured claim to take into account the car’s need for expensive repairs? Maybe [...]
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Judge Feeney, Massachusetts Bankruptcy Judge, days ago issued an important decision on an issue of whether a Chapter 13 debtor would be allowed a means test deduction for a payment of a secured debt when the payment was not being paid due to lien avoidance. See In re Marshall, 2009 WL 1652471 (Bkrtcy.D.Mass. 2009). [...]
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In general, a simple, no asset Chapter 7 bankruptcy case will usually go on for about 4 months, but the case could be open a lot longer.
When filed, the Court sends out a Notice of Filing to all parties in the case, notifying everyone of the filing and of the deadlines involved. The notice contains [...]
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Hat tip to my New York colleague, David B. Shaev, for the excellent coverage and honest statements. Finally, the news media gets their information about bankruptcy right!
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Some companies are sending letters to bankruptcy debtors for the 2nd bankruptcy course that must be taken in bankruptcy. These letters can be misleading and many debtors believe, after reading the letter, that they must take the course from that particular company.
Companies get a list of bankruptcy filings and the addresses of all people [...]
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If a creditor sends a letter to you after your discharge, they may be violating the Bankruptcy Code - even if they include language saying it’s just for informational purposes.
The recent case of In re BIRAKOYE NASSOKO, Case No. 07-11966 (ALG) (SDNY 2009) involved a car lender that sent a consumer a payment demand comtaining [...]
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The borrower’s personal liability for a home equity line of credit or a standard second position home mortgage is dischargable in bankruptcy. A reader of my website Bankruptcy in Brief, emailed me about conflicting input she was getting in her self prepared bankruptcy case.
I learned that the sources of misinformation continue to multiple: some HUD [...]
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Bankruptcy and Foreclosure Defense attorney Andy Miofsky announces the opening of his new office in Mt. Vernon Illinois.
“Clients from deep Southern Illinois are driving 90 minutes or more to my Granite City office for a consultation, so I know there is a need that isn’t currently being met in that area,” reports Andy Miofsky. “I [...]
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If you have a commercial lease in bankruptcy, it pays to reject it quickly according to the Eighth Circuit Bankruptcy Appellate Panel.
When a business or individual with a lease on commercial real estate, like a store or (in this case) farmland, files bankruptcy, the debtor or trustee has the right to assume or reject the [...]
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The U.S Court of Appeals, Fifth Circuit, recently ruled that on the means test’s Form B22A, a vehicle ownership expense is allowed even when the debtor has no car payment. The court’s ruling in In re Tate, No. 08-60953 (5th Cir. June 10, 2009), agrees with the only other circuit court opinion on this issue, In re [...]
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The Eighth Circuit Bankruptcy Appellate Panel recently reversed a Minnesota bankruptcy court’s ruling that under Minnesota law, a chapter 7 trustee was not entitled to $90,000 which had been mistakenly deposited by a bank president into the debtor’s bank account before he filed bankruptcy. The bankruptcy court had ruled that because the deposit was a mistake, [...]
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I’ve been having more and more potential clients who are older come see me asking about bankruptcy. Sometimes, bankruptcy is a good solution for these people. Sometimes though, bankruptcy is not a good option. And quite often, very few good options remain to deal with your debt.
Recently, I spoke with an older person who wanted to know if [...]
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Your decision to file for bankruptcy should involve a great deal of thought and discussion with both your loved ones as well as your legal counsel. Once filed, a bankruptcy carries with it some significant consequences.
First, your credit will be affected if you are bankruptcy for one day, one month, one year, or longer. Credit [...]
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I was sitting in bankruptcy court this morning, waiting for my cases to be called, when something unusual caught my attention. The trustee who was presiding made a very sarcastic remark.
Now, I have to tell you, for some trustees that wouldn’t seem unusual. This particular trustee, however, is usually the soul of polite good humor. [...]
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Last month I wrote a post about problems I had been having accessing the Bankruptcy Court’s ECF system and a workaround to solve that problem. In that post I spoke about a problem that arises when your browser sees the ECF bankruptcy pleading filing screen as a disallowed pop-up, thereby leaving you with a blank [...]
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If you stop making Chapter 13 payments and do nothing else, your bankruptcy case will be dismissed and the court will not enter a discharge order. This means you will lose the benefits of your bankruptcy and will no longer be protected from your creditors.
When your bankruptcy case was filed, the court entered a stay [...]
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It is not uncommon for debtors to have attorney fee claims against themselves and/or future property of the estate. The most common example is an attorney fee lien agreement on a personal injury case. In the event of recovery in those cases, the attorney typically receives 33% or more of the gross settlement or judgment.
Recently, [...]
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Congress established the Office of the U. S. Trustee as part of the Bankruptcy Reform Act of 1978 to act on behalf of the executive branch and regulate or supervise certain aspects of the bankruptcy process.
According to the official website the US Trustee program consists of the Executive Office for U. S. Trustees (EOUST) located [...]
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When you file a bankruptcy case, you may get a letter from a company that makes it seem as if you have to take a course from them, now that you have filed for bankruptcy. You don’t.
Read the letter carefully, because it might be an advertisement for the Financial Management Course that is given by [...]
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Why is it that consumers and small business owners see bankruptcy as a mark of shame to be avoided at all costs when bankruptcy is touted as a new beginning and a positive step for corporate America? Is there really anything different about “bankruptcy” when the debtor is General Motors than when it is Joe [...]
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A recent Idaho bankruptcy court decision, In re Jackson, 2009 WL 562621 (Bky.D.Idaho March 5, 2009), shows how critical it can be to correctly choose, in a chapter 13 plan, whether property of the estate should or should not vest in the debtor upon confirmation of the plan. In this case, the debtors suffered having [...]
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This is the sixth in a series of blogs about the Statement of Financial Affairs and the questions it asks.
Question 6 of the Statement of Financial Affairs is a two-parter. The first part asks about “Assignments for the Benefit of Creditors,” and the second part asks about receiverships.
What is an “Assignment for the Benefit of [...]
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More and more, I’m seeing folks in my office after attempting debt workouts through debt settlement companies. Usually, the debt settlement companies that these people used were ones that advertise heavily on television and in other media. And usually, the potential clients have paid a lot of money to these debt settlement firms and gotten very little out of it.
So now, they [...]
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You have decided to file bankruptcy and even taken the first step of finding competent counsel to help. Hopefully you have met with the attorney and he has given you some forms to fill out or told you what he needs to prepare the paperwork.
You need to get him the information right away so he [...]
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You may listen online to the audio recordings of the Chrysler LLC, 09-50002, and General Motors Corporation, 09-50026, bankruptcy hearings in the U.S. Bankruptcy Court in the Southern District of New York.
Available Online: Recordings of GM and Chrysler Bankruptcy Case Hearings
The recordings are being made available online through through a pilot project of [...]
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A Tennessee bankruptcy court recently ruled that confirmation by the court of a chapter 13 plan did not affect the debtor’s obligation to continue paying his ex-wife’s house payment. The chapter 13 plan did not specifically say that the ex-wife’s rights were being altered by the proposed plan, although the plan implicitly treated the ex-wife as [...]
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Forbes.com says the top 20 American cities for credit card (over)spending are:
Miami, FL
Tampa, FL
Los Angeles, CA
Jacksonville, FL
Orlando, FL
Riverside, CA
San Diego, CA
San Antonio, TX
Las Vegas, NV
Sacramento, CA
Virginia Beach, VA
Pittsburgh, PA
Phoenix, AZ
Columbus, OH
Cleveland, OH
Charlotte, NC
Austin, TX
Cincinnati, OH
Indianapolis, IN
Houston, TX
Miami households owe 22.61% of their income to credit cards compated to Houston households owing 13.60%.
Forbes determined where [...]
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Banks and credit unions love to have automatic payroll deductions from their customers. It helps them guarantee as long as you work, you pay them. What happens when you file bankruptcy?
The bank or credit union should think twice about continuing to “accept” these payroll deductions. That’s the lesson from a recent Eighth Circuit Bankruptcy Appellate [...]
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It is a good idea to make sure that you don’t have funds in bank accounts at banks you owe money to, particularly if you are going to file for bankruptcy. Banks will often keep the funds in your account on the day your file for bankruptcy to set off against the debt owed to [...]
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A simple enough situation. After a bankruptcy case was filed, a large telephone and Internet ervice provider sent bills from its special bankruptcy administration office for a pre-bankruptcy debt. I filed a motion for sanctions. The provider then sent a notice of termination of services. I called it to confirm receipt of the motion and [...]