In this day and age of do-it-yourself businesses, big box discount stores and the growth of the Internet, most people are always looking for a deal. Today, many individuals shop prices from the security of your own home using the Internet for price comparison. People now can shop for cars, houses, vacations, airfare, and just about everything under the sun online. But is cheap always the best? In the past, Americans put a high priority on quality. This even transcended into the service industry from contractors to even law firms. Sure you can shop around and find someone who will do it cheaper, but how good of a job will the person do. This has filtered into the Bankruptcy attorney business. There are ads online where you can find a bankruptcy attorney to file Chapter 7 for $700 or $800. I'm sure they must be getting a lot of takers or they wouldn't be advertising. What's crazy is, would someone search online for the cheapest doctor they could find to perform a procedure on a family member? This is no different than hiring a bankruptcy attorney on a budget.
The folks that try to save a few bucks usually end up paying double in the end. Most bankruptcy attorneys offer a free initial consultation. This is a great time for someone to educate themselves and also meet the attorney to make sure that they feel comfortable with them. When filing bankruptcy, trust is very important. If someone doesn't trust their bankruptcy attorney, they will usually hold back information that might be damaging to their case. Having an attorney that the individual filing is comfortable with goes a long way for a successful bankruptcy filing.
Being cheap when searching for a bankruptcy attorney will usually come back and bite the individual. Since the real estate bubble burst back in 2007, many Americans have been faced with foreclosure and filing bankruptcy. Because of this many attorneys have added bankruptcy to the law they practice. The bankruptcy code has become much more complex than it was in the past, making experience invaluable. A bankruptcy attorney will usually charge based on the knowledge they have of the bankruptcy law. Experience converts to knowledge and cannot be handed over to anyone for free. When considering someone's financial future, this experience will provide quality results in the bankruptcy filing.
There is a lot of advertising that comes by e-mail and banner ads online, run by plastic surgeons offering deals for LASIK procedure for $500 an eye. When you're talking about your vision it would be foolish to risk your eye sight to save a few bucks. This also applies to hiring a bankruptcy attorney. Considering the cost of an average attorney versus the amount of debt that's wiped out in a typical Chapter 7 bankruptcy, it is really quite a value. For this reason, it's foolish to scrimp unless you have nothing to lose.
Minggu, 26 November 2017
Rabu, 01 November 2017
Signing a Reaffirmation Agreement in Chapter 7 Bankruptcy
One of the toughest things to deal with when filing Chapter 7 bankruptcy is a reaffirmation agreement. Many times, a bankruptcy attorney will not want their client to sign a reaffirmation agreement. When a person goes through all the trouble to file for bankruptcy, they are given a chance to start all over and even possibly be debt-free. Obligating themselves to anyone financially might take them back to the same situation that caused them to file Chapter 7 bankruptcy. Without signing any agreements, the debtor should be able to eliminate all unsecured debts and secured debts also. They will have to surrender the secured property back to the creditor, but they would no longer have any liability from the debt to that creditor. If a person agrees to sign a reaffirmation agreement while filing bankruptcy and later change their mind, they will be liable for any damages to that creditor. Most of the time, a bankruptcy attorney will advise their client to think carefully on agreeing to any debt at this time.
In most cases, cars, houses and large ticket items fall under the category of secured debt. If the person refuses to sign an agreement the creditor can come repossess the property. The good news for the debtor is, any liability or damages that the creditor seeks will be wiped out in the bankruptcy discharge. So if there are any back payments, physical damage to the property or any costs incurred by the creditor, the debtor will not be responsible for any of it.
Even against the advice of a bankruptcy attorney, many people will decide on agreeing to sign the reaffirmation agreement. The typical excuse is, I need my car. Sometimes people should reevaluate the automobile they drive and the cost of it. If it is in excess, one should consider letting it go and buying something cheaper prior to filing bankruptcy. The downside to a reaffirmation agreement is it blemishes the fresh start that bankruptcy was created for by having the debtor continue on paying on certain debts. All too many times after the bankruptcy filing, the debtor will have buyer's remorse and call the bankruptcy attorney looking for a way out. It's understandable for the reasons of why the debtor would go along with one of these agreements. First of all, everyone knows that in America a person's car and house are an extension of their ego. Giving either of these up, to them is that admission of failure. Because of this, creditors force the issue to keep the people in bondage to their debt.
It seems foolish to go through all that trouble of filing bankruptcy and not use it to the full extent of the law. People filing bankruptcy need to heed to the advice of their bankruptcy attorney as this is not their first picnic. They have seen the reactions of their clients over and over again. This experience gives them the ability to almost foresee the future and the results of that person's bankruptcy filing.
In most cases, cars, houses and large ticket items fall under the category of secured debt. If the person refuses to sign an agreement the creditor can come repossess the property. The good news for the debtor is, any liability or damages that the creditor seeks will be wiped out in the bankruptcy discharge. So if there are any back payments, physical damage to the property or any costs incurred by the creditor, the debtor will not be responsible for any of it.
Even against the advice of a bankruptcy attorney, many people will decide on agreeing to sign the reaffirmation agreement. The typical excuse is, I need my car. Sometimes people should reevaluate the automobile they drive and the cost of it. If it is in excess, one should consider letting it go and buying something cheaper prior to filing bankruptcy. The downside to a reaffirmation agreement is it blemishes the fresh start that bankruptcy was created for by having the debtor continue on paying on certain debts. All too many times after the bankruptcy filing, the debtor will have buyer's remorse and call the bankruptcy attorney looking for a way out. It's understandable for the reasons of why the debtor would go along with one of these agreements. First of all, everyone knows that in America a person's car and house are an extension of their ego. Giving either of these up, to them is that admission of failure. Because of this, creditors force the issue to keep the people in bondage to their debt.
It seems foolish to go through all that trouble of filing bankruptcy and not use it to the full extent of the law. People filing bankruptcy need to heed to the advice of their bankruptcy attorney as this is not their first picnic. They have seen the reactions of their clients over and over again. This experience gives them the ability to almost foresee the future and the results of that person's bankruptcy filing.
Sabtu, 21 Oktober 2017
What Should I Avoid Prior to Filing for Bankruptcy Protection?
There are certain things that you should not do prior to filing for bankruptcy, as it may inconvenience you, or hinder or delay your case.
Banking
When it comes to banking, most consumers are loyal to their banks. The most common phrase I hear is, "But I've been banking with "X" Bank for more than "X" years! They have been very good to me." These banks are so good to their customers that they are allowing them to take out credit cards that are linked to their bank accounts. What the consumers don't realize is that if they are behind on their payments, the banks have the ability to offset the debt by taking the money from their customer's bank accounts. They are able to do so because the contracts signed (which most people don't read) allow them to do so. Thus, consumers are surprised to find that when it comes time to send off the rent check or mortgage payment, they don't have the money to do so because their bank already has a chunk of their money. To avoid this scenario, do not bank at an institution where you owe money. Some consumers think they are safe if they do not have the funds in their bank accounts. This is not always true. Banks can still offset the debt, and then you would be considered overdrawn, and now you would owe bank fees and bounced checks due to non-sufficient funds.
Paying Down Debt
If you were trying to avoid bankruptcy, then paying down your debt is a great idea. However, if you already know that your only available option is to file bankruptcy, you should not be paying back your creditors, especially your family and friends, whom are considered "insiders." Paying creditors back is considered a "preference." If you have paid back more than $600 to an "insider" in the past year, the trustee has the option of going after the person you paid back to get the money back for the bankruptcy estate, if the funds are significant enough.
Receiving Inheritance
If you believe you are listed as a beneficiary in a will, trust, or life insurance policy, and you are about to receive the inheritance within the next six months, you may not wish to file for bankruptcy. Any proceeds received within 180 days of the filing of your bankruptcy petition are considered to be a part of your bankruptcy estate. If you receive a substantial inheritance, there may not be enough exemptions to protect the inheritance, and in a Chapter 7, the inheritance could be used to pay off your debt to your creditors. Thus, if you think you will receive a substantial inheritance, you may be better off trying to negotiate with your creditors instead.
Lying to Your Attorney
If you retained the services of an attorney to proceed with your bankruptcy case, it is imperative that you do not lie to them about your finances. You should not hide your assets from your attorney, nor should you lie by omitting certain important information regarding your situation to your attorney. Your attorney cannot protect you if they do not know about your problem. If there was an issue in your bankruptcy case, you do not want your attorneys to be the only one in the room surprised by the problem. Your attorneys are not mind readers, they would not know that they need to help you if you do not tell them.
Banking
When it comes to banking, most consumers are loyal to their banks. The most common phrase I hear is, "But I've been banking with "X" Bank for more than "X" years! They have been very good to me." These banks are so good to their customers that they are allowing them to take out credit cards that are linked to their bank accounts. What the consumers don't realize is that if they are behind on their payments, the banks have the ability to offset the debt by taking the money from their customer's bank accounts. They are able to do so because the contracts signed (which most people don't read) allow them to do so. Thus, consumers are surprised to find that when it comes time to send off the rent check or mortgage payment, they don't have the money to do so because their bank already has a chunk of their money. To avoid this scenario, do not bank at an institution where you owe money. Some consumers think they are safe if they do not have the funds in their bank accounts. This is not always true. Banks can still offset the debt, and then you would be considered overdrawn, and now you would owe bank fees and bounced checks due to non-sufficient funds.
Paying Down Debt
If you were trying to avoid bankruptcy, then paying down your debt is a great idea. However, if you already know that your only available option is to file bankruptcy, you should not be paying back your creditors, especially your family and friends, whom are considered "insiders." Paying creditors back is considered a "preference." If you have paid back more than $600 to an "insider" in the past year, the trustee has the option of going after the person you paid back to get the money back for the bankruptcy estate, if the funds are significant enough.
Receiving Inheritance
If you believe you are listed as a beneficiary in a will, trust, or life insurance policy, and you are about to receive the inheritance within the next six months, you may not wish to file for bankruptcy. Any proceeds received within 180 days of the filing of your bankruptcy petition are considered to be a part of your bankruptcy estate. If you receive a substantial inheritance, there may not be enough exemptions to protect the inheritance, and in a Chapter 7, the inheritance could be used to pay off your debt to your creditors. Thus, if you think you will receive a substantial inheritance, you may be better off trying to negotiate with your creditors instead.
Lying to Your Attorney
If you retained the services of an attorney to proceed with your bankruptcy case, it is imperative that you do not lie to them about your finances. You should not hide your assets from your attorney, nor should you lie by omitting certain important information regarding your situation to your attorney. Your attorney cannot protect you if they do not know about your problem. If there was an issue in your bankruptcy case, you do not want your attorneys to be the only one in the room surprised by the problem. Your attorneys are not mind readers, they would not know that they need to help you if you do not tell them.
Rabu, 04 Oktober 2017
Making Sense of the New Bankruptcy Code and IRA Protections
Erasing your debts just got much harder. Two major decisions have recently passed in Washington that may have a dramatic impact, positive or negative, on the lives of many Americans. On April 20, 2005 President Bush signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. And on April 4th, 2005 the U.S. Supreme court ruled that under the bankruptcy code, IRA balances were protected from creditors in a bankruptcy. Both decisions might radically affect your life and require careful consideration, especially if your profession (ie. Medicine) exposes you to potential litigation. This article will expand on some of the recent changes.
Bankruptcy Act
Backed by powerful credit card industry lobbyists, our "friends" on Capitol Hill have been busily at work protecting credit card companies at the expense of the consumer. The Act, parts of which are effective immediately and other parts which go into effect on October 17th, 2005, makes it harder for consumers to erase their unsecured debts and requires debtors to seek credit card counseling before being able to file (more on this later). Here are some of the highlights.
By way of background, individuals may declare one of two forms of bankruptcy---Chapter 7 or Chapter 13.
Under Chapter 7, individual is permitted to keep certain assets, but all others are relinquished to satisfy cost of bankruptcy and creditor claims. Most debts are discharged completely and debtor is no longer responsible for repayment. Child support, alimony and education loans cannot be discharged and the debtor cannot file again for eight years (bumped up from six years).
Under Chapter 13 bankruptcy, a plan is created under which the debtor will repay outstanding debts within specified time. Usually the amount owed is reduced by the judge so that payments remain manageable and debtor is generally not obligated to relinquish any assets.
Means Testing
The most important factor of the law has to do with the "means test" that bankruptcy filers would be subjected to in order to determine if they qualify for Chapter 7 or Chapter 13. There are two facets of the test that are conducted: the median income test and the means test.
The (personal income) means test is based largely on median state incomes. So if the combined gross household income is greater than the median income in your state, the law prevents you from filing Chapter 7 (completely eliminating your debt) and may force you to file a Chapter 13 plan. So, for example a Florida physician supporting a family of 4 would be subjected to a state median of only $62,742 (add $7,500 for each individual in excess of 4). If the combined income in the physician's household is more than the state's median income threshold (and, of course it is), then you do have to apply the Mean's Test, and to do so you need to calculate Monthly Expenses. To find out what the state median income levels are you can visit the Census Bureau's website.
The second test checks to see if the debtor's current monthly income (reduced by allowed expenses) exceeds an amount allowed under the Act for a family of the same size. The means test is basically an "excess income" test used to determine what money is left over after deducting reasonable expenses that can be used to pay unsecured creditors.
Included within the calculation of debtor's monthly expenses are: 1) reasonably necessary expenses incurred to maintain the safety of the debtor and the debtor's family (see link below); 2) continuation of actual expenses paid by the debtor for the care and support of an elderly, chronically ill, or disabled household or nondependent immediate family member; and 3) an additional allowance for housing and utilities based upon documented home energy expenses.
Individuals may use the 'National Standards for Allowable Living Expenses' charts available on the IRS website to determine the standards for food, clothing and other items. The chart is based on the individual's gross monthly income.
If a Debtor's income meets or exceeds the mean's test, then any Ch 13 Plan must have duration for at least five years unless the plan provides that all allowed unsecured claims are to be paid in full over a shorter term.
Credit Counseling
The other critical (and controversial) matter is the mandatory requirement that debtors go through credit counseling in order to qualify for bankruptcy, and counseling must start at least 180 days before filing for federal bankruptcy protection. This particular portion of the Act is quite disturbing, given that the credit counseling industry is not only unregulated, but in fact is beset with unimaginable fraud and abuse by "bad players". There are too many counseling agencies out there posing as non-profits that get away with grossly overcharging clients for services, implementing absurd monthly fees, and do little to negotiate with the credit card companies to reduce rates and/or debt. Credit counseling agencies are supposed to help consumers out of debt; many in fact, make the problems worse. Basically, Congress just paved the way for unknowing consumers to be thrown into the lion's den in an already corrupt system. Their mission, I'm sure, was accomplished as soon as they secured sizable contributions from credit card companies in exchange for this law.
Homestead Protection
The Act also modified some of the protections offered by the previous Homestead Exception (which is already in effect).
The homestead exemption applies to property used as your residence. As of 2011, the federal homestead exemption is $21,165. State homestead exemptions vary a great deal. In some states, like Florida, there's no limit, while in other states, like New York, the limit is $50,000 to $150, 000, depending on where you live.
Before the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Act) was passed, it was common for homeowners to move to a state with a generous homestead exemption and shield assets from creditors by buying an expensive home.
The Act tries to stop this practice by limiting any homestead exemption to $125,000 (inflation adjusted $146,450) if you bought the home within 1215 days (3 years and 4 months) before filing for bankruptcy. This doesn't apply to a debtor already living in the same state who merely transferred his/her interest from a previous principal residence.
Any addition to the value of a homestead that is funded by nonexempt property, and made with the intent to hinder, delay, or defraud creditors, is not protected by the state homestead exemption if it was made during the ten year period before a debtor filed for bankruptcy.
There is a $125,000 cap on the homestead exemption for any debtor convicted of a felony which demonstrates bankruptcy abuse, or if the debtor owes a debt arising from violation of Federal or State securities laws, criminal act, intentional tort, or willful or reckless misconduct that caused serious physical injury or death to another individual during the last five years.
Fraudulent Transfers
Fraudulent transfers are asset transfers that are made with the intent to defraud a creditor (or potential creditor). It is not a criminal activity, but the transaction may be reversed by a judge and therefore make the assets accessible to your creditor.
The look back period in which certain transfers are deemed to be fraudulent and recoverable under the Bankruptcy Code was increased from one to two years. However, state fraudulent conveyance laws often allow the bankruptcy trustee to go back even further. The two year period applies only to cases filed twelve months or more after enactment of the Act.
Bankruptcy Act
Backed by powerful credit card industry lobbyists, our "friends" on Capitol Hill have been busily at work protecting credit card companies at the expense of the consumer. The Act, parts of which are effective immediately and other parts which go into effect on October 17th, 2005, makes it harder for consumers to erase their unsecured debts and requires debtors to seek credit card counseling before being able to file (more on this later). Here are some of the highlights.
By way of background, individuals may declare one of two forms of bankruptcy---Chapter 7 or Chapter 13.
Under Chapter 7, individual is permitted to keep certain assets, but all others are relinquished to satisfy cost of bankruptcy and creditor claims. Most debts are discharged completely and debtor is no longer responsible for repayment. Child support, alimony and education loans cannot be discharged and the debtor cannot file again for eight years (bumped up from six years).
Under Chapter 13 bankruptcy, a plan is created under which the debtor will repay outstanding debts within specified time. Usually the amount owed is reduced by the judge so that payments remain manageable and debtor is generally not obligated to relinquish any assets.
Means Testing
The most important factor of the law has to do with the "means test" that bankruptcy filers would be subjected to in order to determine if they qualify for Chapter 7 or Chapter 13. There are two facets of the test that are conducted: the median income test and the means test.
The (personal income) means test is based largely on median state incomes. So if the combined gross household income is greater than the median income in your state, the law prevents you from filing Chapter 7 (completely eliminating your debt) and may force you to file a Chapter 13 plan. So, for example a Florida physician supporting a family of 4 would be subjected to a state median of only $62,742 (add $7,500 for each individual in excess of 4). If the combined income in the physician's household is more than the state's median income threshold (and, of course it is), then you do have to apply the Mean's Test, and to do so you need to calculate Monthly Expenses. To find out what the state median income levels are you can visit the Census Bureau's website.
The second test checks to see if the debtor's current monthly income (reduced by allowed expenses) exceeds an amount allowed under the Act for a family of the same size. The means test is basically an "excess income" test used to determine what money is left over after deducting reasonable expenses that can be used to pay unsecured creditors.
Included within the calculation of debtor's monthly expenses are: 1) reasonably necessary expenses incurred to maintain the safety of the debtor and the debtor's family (see link below); 2) continuation of actual expenses paid by the debtor for the care and support of an elderly, chronically ill, or disabled household or nondependent immediate family member; and 3) an additional allowance for housing and utilities based upon documented home energy expenses.
Individuals may use the 'National Standards for Allowable Living Expenses' charts available on the IRS website to determine the standards for food, clothing and other items. The chart is based on the individual's gross monthly income.
If a Debtor's income meets or exceeds the mean's test, then any Ch 13 Plan must have duration for at least five years unless the plan provides that all allowed unsecured claims are to be paid in full over a shorter term.
Credit Counseling
The other critical (and controversial) matter is the mandatory requirement that debtors go through credit counseling in order to qualify for bankruptcy, and counseling must start at least 180 days before filing for federal bankruptcy protection. This particular portion of the Act is quite disturbing, given that the credit counseling industry is not only unregulated, but in fact is beset with unimaginable fraud and abuse by "bad players". There are too many counseling agencies out there posing as non-profits that get away with grossly overcharging clients for services, implementing absurd monthly fees, and do little to negotiate with the credit card companies to reduce rates and/or debt. Credit counseling agencies are supposed to help consumers out of debt; many in fact, make the problems worse. Basically, Congress just paved the way for unknowing consumers to be thrown into the lion's den in an already corrupt system. Their mission, I'm sure, was accomplished as soon as they secured sizable contributions from credit card companies in exchange for this law.
Homestead Protection
The Act also modified some of the protections offered by the previous Homestead Exception (which is already in effect).
The homestead exemption applies to property used as your residence. As of 2011, the federal homestead exemption is $21,165. State homestead exemptions vary a great deal. In some states, like Florida, there's no limit, while in other states, like New York, the limit is $50,000 to $150, 000, depending on where you live.
Before the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Act) was passed, it was common for homeowners to move to a state with a generous homestead exemption and shield assets from creditors by buying an expensive home.
The Act tries to stop this practice by limiting any homestead exemption to $125,000 (inflation adjusted $146,450) if you bought the home within 1215 days (3 years and 4 months) before filing for bankruptcy. This doesn't apply to a debtor already living in the same state who merely transferred his/her interest from a previous principal residence.
Any addition to the value of a homestead that is funded by nonexempt property, and made with the intent to hinder, delay, or defraud creditors, is not protected by the state homestead exemption if it was made during the ten year period before a debtor filed for bankruptcy.
There is a $125,000 cap on the homestead exemption for any debtor convicted of a felony which demonstrates bankruptcy abuse, or if the debtor owes a debt arising from violation of Federal or State securities laws, criminal act, intentional tort, or willful or reckless misconduct that caused serious physical injury or death to another individual during the last five years.
Fraudulent Transfers
Fraudulent transfers are asset transfers that are made with the intent to defraud a creditor (or potential creditor). It is not a criminal activity, but the transaction may be reversed by a judge and therefore make the assets accessible to your creditor.
The look back period in which certain transfers are deemed to be fraudulent and recoverable under the Bankruptcy Code was increased from one to two years. However, state fraudulent conveyance laws often allow the bankruptcy trustee to go back even further. The two year period applies only to cases filed twelve months or more after enactment of the Act.
Sabtu, 23 September 2017
Just As It Is in All Things, Planning for Personal Bankruptcy Is Important
With a large number of Americans still looking for work, we can expect to see the numbers of those filing for bankruptcy to continue to rise over the next couple years. The hardest part of a bankruptcy filing is the planning. Usually, most Americans use a bankruptcy filing as a last resort for overwhelming debt. Most people that wait till the last minute to file for personal bankruptcy don't have any time to do any kind of planning. It would be much better when people get into financial trouble that they would take the time to consult a bankruptcy lawyer about this situation. In many cases, there might be other alternatives and filing bankruptcy might not be in the cards at this time. Having the knowledge of what to do and even better what not to do prior to filing bankruptcy is well worth the time spent on a consultation. Before deciding to sign up for a payment plan, refinance your house or even worse, borrow money from friends and relatives one should consult a bankruptcy lawyer to avoid making a mistake that has severe consequences.
When people don't plan for filing bankruptcy, they don't realize the landmines they might be stepping on that will blow up during the bankruptcy filing. They are just trying to survive by whatever means. With changes to the bankruptcy code that went into effect back in 2005, a person has to qualify to file Chapter 7 bankruptcy. To pass the means test the person filing for bankruptcy will have to show an income below the median income for their state. Many people in financial trouble run to their pension and borrow money prior to filing bankruptcy, not realizing that this becomes income according to the bankruptcy code. Now, the person who might be unemployed at the time, is now showing a large amount of income in a short period of time and no longer qualifies to file Chapter 7 bankruptcy. This could've been easily resolved by speaking with a bankruptcy lawyer prior to making this faux pas. There is a way around it as the bankruptcy lawyer will just have the debtor delay the filing. They will have to wait a period of time for this sum of money to drop off the radar so their income is low enough to file for bankruptcy. The problem is, when someone stops paying their bills, they are a target by their creditors to file lawsuits before they have a chance to file for personal bankruptcy. If the creditor can get the debtor into court, they can get a judgment against the debtor and begin garnishing their wages. This just creates another roadblock for the bankruptcy lawyer that can be resolved after the bankruptcy is filed with the court.
In a perfect world, the US should teach young adults about financial planning and using a personal bankruptcy filing to give them a basic education on the process. This would give young people an idea of how the bankruptcy process works if they ever ran into financial difficulties. One thing is for sure, if school taught the benefits of filing bankruptcy, the credit industry would spend millions on lobbyists to make it stop.
When people don't plan for filing bankruptcy, they don't realize the landmines they might be stepping on that will blow up during the bankruptcy filing. They are just trying to survive by whatever means. With changes to the bankruptcy code that went into effect back in 2005, a person has to qualify to file Chapter 7 bankruptcy. To pass the means test the person filing for bankruptcy will have to show an income below the median income for their state. Many people in financial trouble run to their pension and borrow money prior to filing bankruptcy, not realizing that this becomes income according to the bankruptcy code. Now, the person who might be unemployed at the time, is now showing a large amount of income in a short period of time and no longer qualifies to file Chapter 7 bankruptcy. This could've been easily resolved by speaking with a bankruptcy lawyer prior to making this faux pas. There is a way around it as the bankruptcy lawyer will just have the debtor delay the filing. They will have to wait a period of time for this sum of money to drop off the radar so their income is low enough to file for bankruptcy. The problem is, when someone stops paying their bills, they are a target by their creditors to file lawsuits before they have a chance to file for personal bankruptcy. If the creditor can get the debtor into court, they can get a judgment against the debtor and begin garnishing their wages. This just creates another roadblock for the bankruptcy lawyer that can be resolved after the bankruptcy is filed with the court.
In a perfect world, the US should teach young adults about financial planning and using a personal bankruptcy filing to give them a basic education on the process. This would give young people an idea of how the bankruptcy process works if they ever ran into financial difficulties. One thing is for sure, if school taught the benefits of filing bankruptcy, the credit industry would spend millions on lobbyists to make it stop.
Selasa, 05 September 2017
Free Bankruptcy Forms Available To Debtors Without a Bankruptcy Attorney
As the economy continues to struggle, many Americans are feeling the pressures of being buried under mountains of debt. Living paycheck to paycheck is a reality for many as they try to hold on hoping that things will turn around and get better. All it takes is for one unexpected circumstance to happen such as a sudden illness or major car repair and these individuals finances will be sent spiraling out of control. Filing bankruptcy can offer a solution to individuals such as these.
Making the decision to file bankruptcy is certainly a serious step and the individual needs to take into account all of the possible ramifications that come with a bankruptcy filing. For example, filing bankruptcy will affect the debtor's credit rating and alter their ability to borrow money or obtain credit for a period of time in the future. Rebuilding one's credit is not impossible but it requires time and diligence on the part of the debtor. But if an individual finds themselves in a situation that they are not in control of their finances and in terrible debt then bankruptcy will give them a much needed second chance. Some people are so deep in debt that they have a difficult time even coming up with enough money to pay for a bankruptcy attorney. So what then do these individuals do?
It is important to realize that filing bankruptcy is a person's legal right and they also have a right to represent themselves in a bankruptcy case. The place to begin is right on your own computer. There is a wealth of information on the internet about bankruptcy. The debtor can even download the bankruptcy forms for free online from the US bankruptcy court website. The debtor will need to really do their homework and research the bankruptcy laws for their district as they tend to vary not only from state to state, but from district to district. With the changes to the bankruptcy code back in 2005, filing bankruptcy became more complicated. The bankruptcy petition almost doubled in size and became more difficult to fill out. It has landmines that if it is not filled out properly the case can be dismissed without a discharge. There was an addition of mandatory credit counseling and financial management courses that needed to be completed prior to the discharge. A means test was added to qualify a debtor to file Chapter 7 bankruptcy or they would be forced into a Chapter 13 bankruptcy. Exemption laws for protecting property and assets became more involved. Basically filing for bankruptcy became more convoluted for the average individual wanting to file pro se, or on their own. With that said, it is more complicated, but not impossible to file pro se. If the debtor is confident in their ability to research and navigate the internet for bankruptcy information and then download the free bankruptcy forms, then they will certainly save money. The only costs for filing will be the court filing fees which run around $199 nationwide and the cost of the required bankruptcy courses which are around $30-$50 per course. An individual that is really strapped for cash may apply for a fee waiver from the court and even receive a fee waiver or discount from the credit counseling company.
Making the decision to file bankruptcy is certainly a serious step and the individual needs to take into account all of the possible ramifications that come with a bankruptcy filing. For example, filing bankruptcy will affect the debtor's credit rating and alter their ability to borrow money or obtain credit for a period of time in the future. Rebuilding one's credit is not impossible but it requires time and diligence on the part of the debtor. But if an individual finds themselves in a situation that they are not in control of their finances and in terrible debt then bankruptcy will give them a much needed second chance. Some people are so deep in debt that they have a difficult time even coming up with enough money to pay for a bankruptcy attorney. So what then do these individuals do?
It is important to realize that filing bankruptcy is a person's legal right and they also have a right to represent themselves in a bankruptcy case. The place to begin is right on your own computer. There is a wealth of information on the internet about bankruptcy. The debtor can even download the bankruptcy forms for free online from the US bankruptcy court website. The debtor will need to really do their homework and research the bankruptcy laws for their district as they tend to vary not only from state to state, but from district to district. With the changes to the bankruptcy code back in 2005, filing bankruptcy became more complicated. The bankruptcy petition almost doubled in size and became more difficult to fill out. It has landmines that if it is not filled out properly the case can be dismissed without a discharge. There was an addition of mandatory credit counseling and financial management courses that needed to be completed prior to the discharge. A means test was added to qualify a debtor to file Chapter 7 bankruptcy or they would be forced into a Chapter 13 bankruptcy. Exemption laws for protecting property and assets became more involved. Basically filing for bankruptcy became more convoluted for the average individual wanting to file pro se, or on their own. With that said, it is more complicated, but not impossible to file pro se. If the debtor is confident in their ability to research and navigate the internet for bankruptcy information and then download the free bankruptcy forms, then they will certainly save money. The only costs for filing will be the court filing fees which run around $199 nationwide and the cost of the required bankruptcy courses which are around $30-$50 per course. An individual that is really strapped for cash may apply for a fee waiver from the court and even receive a fee waiver or discount from the credit counseling company.
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