Archive for the ‘Chapter 13 bankruptcy’ Category

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Tips on Keeping Your Home Before, During, and After Bankruptcy

Wednesday, May 12th, 2010

Chapter 7 bankruptcy has many clear advantages, but unfortunately not many for home owners. Technically you can eliminate mortgage debt–just don’t expect to keep your home.

So how do you keep your home instead  of Chapter 7 bankruptcy? What can you do during the bankruptcy? And what happens after — will you be able to buy again or negotiate with the lender? This post gives answers.

Before Bankruptcy
Usually Chapter 13 bankruptcy is best for keeping all your assets. The only negative is you have to pay back your debts; you cannot discharge one dollar in Chapter 13. The advantage is, say you have an expensive home you’ve been paying on for 20 years. Do you really want to lose it to pay back debt? And if you have a job, your chances are higher for keeping it with a new debt repayment plan

That said, if you want to keep your home before bankruptcy, no matter whether it’s Chapter 7 or Chapter 13, you need to 1) hire an experienced attorney and 2) make the loan current.

Why hire an attorney?
An attorney is your very best option for keeping your home. No matter your housing market, no matter how far behind you are in payments, an attorney is invaluable.

Why make the loan current?
Really, this is the most important tip of the entire post. According to law, if you get your loan payment current–meaning you pay all delinquent amounts–the lender cannot take your home. If you’re going to file Chapter 7 bankruptcy, you can keep your home if you negotiate with the lender or if  you work with the trustee. For example, if you also wanted to keep your car, you could pay the amount you owe to the trustee so you can avoid losing it.

Is bankruptcy the best option?
Certainly bankruptcy has advantages and disadvantages. For one, if you wait to long to  file, you may lose your home in foreclosure before you can act. But since Chapter 13 bankruptcy can save your home, it’s often the best option.

Will your credit be ruined?
If your home is foreclosed upon, to put it simply, that’s pretty much the worst thing which can happen to your credit.  You will have a lot of trouble getting financing in the future. However, if you avoid foreclosure, bankruptcy looks far better than foreclosure after you file. While foreclosures are as common as bankruptcies, bankruptcy doesn’t necessarily ruin your credit. If you had to choose between losing everything and ruining your creditor, or keeping much and paying back or discharging debts, what would you do?

What’s the first step?
These tips were meant to show you how to successfully save your home from foreclosure. Before you go into foreclosure, consider bankruptcy. During, stay current on payments. And after, rebuild your credit.

The first step would be to hire an expert who can assess your situation. You may want to file Chapter 7, you may prefer Chapter 13, or perhaps there are alternatives. An experienced bankruptcy attorney can help in numerous ways; just hire the right one.

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How Foreclosure Works and What To Do

Wednesday, May 5th, 2010

Let’s get right to the problem: how do you handle foreclosure? You’ve fallen behind on your house payments. Now, before you do anything, you need to consider your options. Technically, Chapter 7 bankruptcy will not save your home–you lose it in the liquidation. If you act quickly enough, you can file Chapter 13 bankruptcy in order to save your home.

What really is foreclosure?
Foreclosure means you’ve fallen behind in mortgage payments and your lender decides to sell your home. If you do nothing, you will lose the home. If you act before the lender decides to initiate foreclosure proceedings, you can in fact protect your home with what’s called an “automatic stay,” which stops the foreclosure from going through.

How can Chapter 13 help?
Chapter 7 is a liquidation, Chapter 13 a debt repayment plan. You pay nothing, in most cases, with Chapter 7 as your assets are sold. Chapter 13 means you still owe money, but your payments are restructured over 3-5 years. That means if you can stay current with the Chapter 13 repayment plan, you can keep your home.

Foreclosure Process
Here’s what happens if you fail to act quickly enough. This is what could happen if you wait too long to file, or if you do absolutely nothing.

First, you fall behind in mortgage payments. How soon is this? It varies in different states, but technically foreclosure can begin after one missed payment. However, few lenders act that quickly; the majority wait until you fall far behind.

Second, depending on the state, the lender will usually send a notice explaining their intent to foreclose your property. This is a ten day notice, and by this time it may be too late to file for Chapter 13 to save the home.

The lender’s next step is to file a lawsuit with the courts; if you can catch up with payments, this won’t happen. You have a chance to fight this case in court after being given a summons, by responding within a few weeks. This is your opportunity to prove to the judge that something is wrong with this process. At this point, you might consider hiring an attorney to help you. The best choice would clearly be to hire a bankruptcy attorney before this process is initiated.

The next steps are pretty straightforward: you are told of intent to sell if the courts don’t stop it, an auction is held on your home, and you are either evicted or allowed to stay.

That last step, where you are either evicted or allowed to stay, depends on the state. Many states allow you to stay in the home until you are given an official eviction notice.

Steps to Avoid Foreclosure
These laws can be navigated if you take immediate action. Since the time involved depends on the lender, the court, and the market for your home, sometimes you have more time and sometimes you have little if any. There are few ways to gauge how this will work in terms of time. So upon falling behind in payments, if it’s clear you won’t be able to catch up, contact a bankruptcy attorney. The good news is, with Chapter 13 filing, you can save your home.

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What Property is Exempt in Bankruptcy

Monday, May 3rd, 2010

With the Bankruptcy Code, state laws on exemptions are more uniform than ever before. That means we can go over the basics on exempt and nonexempt property after filing bankruptcy.

What is exempt property?
Exempt property is assets you can keep. Nonexempt property you can’t keep. That means if you own a home and it’s considered exempt, you can keep it. If you have a property valued too high, and you’re filing Chapter 7 bankruptcy, that may be considered nonexempt and you cannot keep it.

What forms of bankruptcy use exemptions?
Chapter 7 bankruptcy, the most common for many years but somewhat less common currently, is where exempt and nonexempt assets are considered. Why? Chapter 7 is a liquidation–a trustee will sell your nonexempt assets in order to pay debtors. Chapter 13 bankruptcy is different.

If major property is considered nonexempt, what next?
If you have a home and it’s considered  to be worth too much, and if you have a stable income coming in, you may consider filing under Chapter 13 bankruptcy. Chapter 13 is not a liquidation–it’s a repayment plan spread over 3-5 years. You are to pay bills on time, but you have extended periods to pay them back. In the case of having an expensive home or car you fear losing because of nonexemption, Chapter 13 is a good option. You pay back all debts, but you potentially can keep all your assets.

What property is exempt?
The Bankruptcy Code changes how states consider exemptions. Some states are still, however, very different than others. It depends on if the laws were accepted or not, as some states opted to follow Bankruptcy Code on exemptions and some have not. If you’re home is valued too much, you may lose it in Chapter 7 bankruptcy. In some cases, you might be able to keep it while still discharging debts. In this case, you should hire an experienced lawyer.

What you need to know for your home and car is what equity is left.

Questions for Your Bankruptcy Lawyer
What assets can you keep? That’s the big question. Clearly if you invested a lot of money into a home, if you have a valuable car, and have other valuable assets you fear losing, a good option is to hire an experienced bankruptcy lawyer. He/she can explain your options, how state laws work, and what form of personal bankruptcy you might file. Be thorough with your questions about what property is exempt and nonexempt. There are no bad questions when it comes to bankruptcy law.

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Bankruptcy Eligibility for Phoenix Arizona Residents

Friday, April 30th, 2010

If you are are a Phoenix resident interested in filing personal bankruptcy via either Chapter 7 or Chapter 13, you should first find out if you’re eligible. Once you figure out eligibility, you can take the next important steps in successfully filing and getting a fresh start. This post shows you how, specifically for Phoenix, Arizona residents.

The median income for all states is the basis for Chapter 7 bankruptcy eligibility. With changes in bankruptcy, if you make more than the median income you often have to file under chapter 13 bankruptcy.

Chapter 13 bankruptcy does have clear advantages, but first let’s go over eligibility for Phoenix Chapter 7 bankruptcy.

Eligibility for Chapter 7
As stated, eligibility is different in all 50 states. For Phoenix and all residents of Arizona, here are the numbers.

Phoenix Family of 1, Annual Income Limit $43,397
Phoenix Family of 2, Annual Income Limit $57,620
Phoenix Family of 3, Annual Income of 62,002
Phoenix Family of 4, Annual Income of $71,867
And it increases for each additional family member

Why File Chapter 7 Bankruptcy in Phoenix Arizona?
Chapter 7 bankruptcy has many advantages for Phoenix residents. The median income is about average in Arizona to all other states, noting a lower number than in past years because of the rise in unemployment.

Unemployment is one of the leading reasons to file bankruptcy. If you’ve lost your job, have a lot of assets and little income, Chapter 7 bankruptcy may be good. It can clear credit debt for one, and can be finished in a matter of months.

There are of course other reasons to file for bankruptcy, beyond simply unemployment and credit card debt. You may have high medical bills, for example. Or you may be in danger of losing all your assets and want to cut your losses and eliminate debt. Chapter 7 bankruptcy can do this. Chapter 13 bankruptcy is also an option.

How Can Chapter 13 Bankruptcy Help Phoenix Arizona Residents?
Chapter 13 bankruptcy is very different, but more important now than ever for Arizona residents and residents in other states. Because of the median income law where if you make too much you are not eligible, Chapter 7 is off the table for many. This isn’t necessarily bad.

For one, Chapter 7 bankruptcy means you can lose major nonexempt assets, such as your home and car. If you are still employed,  have an income, but fear foreclosure or the repo-man, you might want to talk to a bankruptcy attorney about Chapter 13 bankruptcy.

There are some eligibility laws for Chapter 13 bankruptcy too, which includes Arizona and all other states. You, as an individual or a family, must have less than $336,900 in unsecured debt such as credit cards, medical debts, and taxes. You must also have less than $1,010,650 in secured debt such as mortgages and car loans. Most people fit into this criteria.

What’s the First Step for Phoenix Arizona Bankruptcy?
The first step is to hire a professional Phoenix bankruptcy attorney who can help you figure out 1) what you’re eligible for and 2) what’s best for you.

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Before You Go into Foreclosure, Consider Hiring a Bankruptcy Attorney

Wednesday, April 28th, 2010

Did you know you can avoid or delay foreclosure by working with an attorney?

Filing bankruptcy can be scary. It sounds like throwing in the towel. Yet no matter how the economy is doing, no matter if you’re employed or unemployed, and no matter the size of your family, things happen. That may be a simple way of putting it, but when a $10,000 medical bill comes in, you fall behind on mortgage payments, or you lose your job, there is nothing easy about it.

What are your options if you fall behind in bills or lose your job?

Depending on your situation, you may be eligible to file bankruptcy.

Why bankruptcy? Technically, Chapter 7 bankruptcy can eliminate the majority of your debts. But this guide isn’t about eliminating debts, but helping you save your home from foreclosure.

You can, in fact, hire a bankruptcy attorney to save your home from foreclosure. If the lender on your home offers no way out, if they make it clear they won’t or can’t work with you, you might have to file for Chapter 13 bankruptcy. Chapter 13 bankruptcy includes in it the “automatic stay,” whereby you can save your home from foreclosure. This may sound too good to be true, and there is some fine print.

If you wait too long to file for Chapter 13 bankruptcy and hiring an attorney, technically the lender can file for a motion to lift the stay. Meaning: the automatic stay will be invalid. Also, they can appeal directly to the court to lift the motion at some point during the Chapter 13 bankruptcy. In both cases, you still have a very good chance of saving your home, especially if you have an experienced bankruptcy attorney.

What is Chapter 13 bankruptcy?
Chapter 13 bankruptcy is different than the more common Chapter 7 bankruptcy. Usually, filers have more in the way of assets. If you file for Chapter 13 bankruptcy, as long as you stay current on bills and the debt repayment plan, you can keep all of your assets.

While Chapter 7 is a liquidation where assets are sold to pay back debtors and your debts are discharged, Chapter 13 bankruptcy buys you time to pay back assets and can delay foreclosure proceeding — effectively saving your home.

How do you file Chapter 13 bankruptcy?
Chapter 13 bankruptcy can be very simple, especially if you hire an experienced bankruptcy attorney. You will have to appear before court in a Chapter 13 bankruptcy, but in a limited way.  Prior to the bankruptcy, you will have to take credit counseling with an approved agency. Once this is done, you pay the fee of $274 and file forms.

Hiring an  Attorney
Before even thinking of all the advantages of saving your home from foreclosure via Chapter 13 bankruptcy, you should query experienced bankruptcy attorneys in your area. This is simply a must. And when you hire one, make sure they are affordable, experienced, and not overloaded with clients.

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What Can You Keep After Filing Bankruptcy?

Friday, April 23rd, 2010

The big question bankruptcy attorneys are asked is: What can I keep after filing bankruptcy? The laws can be complex when it comes to exempt and nonexempt property. So where do you start?

Exempt property is property you can keep. Technically, your home, car, and many possessions can be exempt if you are current on them. This depends on what form of personal bankruptcy you file–Chapter 7 bankruptcy or Chapter 13 bankruptcy.

Nonexempt assets cannot be kept in most cases unless you are filing Chapter 13 bankruptcy, where you have the opportunity to pay back assets over 3-5 years. Nonexempt assets can vary in value, but if you have few valuable assets, and are current on mortgage and car payments, you can often keep the majority of them.

For bankruptcy filers, hiring a professional bankruptcy attorney is simply a must.

What if you file Chapter 7 bankruptcy?
Chapter 7 bankruptcy is a liquidation proceeding where you cancel the majority of your debts, mainly credit card debts. You cannot claim mortgage, tax, alimony, college tuition, and many other forms of debt. You can discharge credit card debt, which is mainly why so many want to use Chapter 7 bankruptcy. Chapter 7 bankruptcy typically only lasts a few months; but bear in mind, any bankruptcy will stay on your record for some time, currently 10 years.

What if you file Chapter 13 bankruptcy?
It’s often noted that Chapter 7 filers are being forced to file Chapter 13. Why are fewer being allowed to file Chapter 7 bankruptcy? It’s mainly because people with higher incomes are filing. If you have enough money to pay expenses, but not enough to cover bills, Chapter 13 bankruptcy can buy you time to pay back bills. No possession–such as your home and car–will be taken if you stay current on them .Also, you get 3-5 years to pay back debts. If you fear home foreclosure, Chapter 13 bankruptcy can save it. It’s important to act early before the foreclosure goes into effect. If you are making enough money to pay most bills, but your house payments are behind, you should immediately inquire with a bankruptcy attorney as to your options.

What money can you keep after filing bankruptcy?
How much money you can have is another important question. If your home and car are valued too high, you may lose them with Chapter 7 bankruptcy. If your car equity is too much, these can be considered nonexempt debts. If on the other hand you have too much money in your account and you have a car or home, these could be taken. These laws can be complex, and  some state laws actually come into play concerning the value of exempt and nonexempt assets. If you’re unsure, a quick consultation with a good bankruptcy attorney can help.

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How to Hire a Bankruptcy Attorney in New York

Friday, April 16th, 2010

If you are want to clear debts and  get a fresh start, Chapter 7 bankruptcy in New York can help. If you fear your home will go into foreclosure, you have many options with Chapter 13 bankruptcy and there are also alternatives to bankruptcy.

The first step in filing bankruptcy in New York is hiring a bankruptcy attorney. You must make this decision if you really want to file, and then who you’ll hire. This post will help.

Advantages of Bankruptcy

It was mentioned that alternatives to bankruptcy are often not as effective. Depending on how the courts treat your case, how much you owe, what assets you have, and what you make, filing bankruptcy has clear advantages
Chapter 13 Advantages: Save your home and property, and buy time to pay back bills
Chapter 7 Bankruptcy Advantages: You can clear most credit card debt, and many other debts

How to Hire a Bankruptcy Attorney in New York
If you look online, you can see thousands of bankruptcy attorneys just in the state of New York. Across the country, there are tens of thousands. However, they are not all equal, can have varying skills, and most important charge different rates. You want to hire a bankruptcy attorney in New York who is not overloaded with work, but is trusted. Referrals can really help in this process.

Create a list of potential bankruptcy attorneys you’re interested in. Research the topic, ask for referrals, and look over websites. Then, query attorneys on years experience, how many bankruptcies they file for clients on  a monthly basis, and how much they actually charge you.

How Can They Help You File Bankruptcy?
If you want to hire a bankruptcy attorney in New York, they must be knowledgeable of all laws concerning bankruptcy. They should also be willing to take calls from your creditors during the proceeding; if creditors call you constantly, this gives you peace of mind. Also, with new laws for filing  bankruptcy in New York and across the country, filing for Chapter 7 bankruptcy and liquidating your assets isn’t always an option. Now more bankruptcies are being changed to Chapter 13 bankruptcies, where you have to pay back debts and not discharge them.

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How to Choose a Good Los Angeles Bankruptcy Attorney

Wednesday, April 14th, 2010

Hiring Los Angeles bankruptcy attorneys is tough, right? In fact, with literally tens of thousands of attorneys and thousands of bankruptcy attorneys, it seems easy. You have many options. You can negotiate process. You can get the best one for the deal. Bankruptcy gives you a fresh start, but one of the most important choices you make is in hiring a good bankruptcy attorney.

However, not all Los Angeles bankruptcy attorneys are a good fit for you. First, some are dishonest and  overcharge you (over billing you on hours, for example). It should be said there are just as many if not more honest Los Angeles bankruptcy attorneys as there are good ones. It’s choosing between the two which is hard.

Making a List of Good Los Angeles Bankruptcy Attorneys
The best way to find bankruptcy attorneys in Los Angeles is to use the web. This saves time on cold calls. You can also work via referrals, as you may know someone who worked with a particularly good bankruptcy attorney. How many Los Angeles bankruptcy attorneys should you consider? There is no big rule on how many you can choose, but 5-10 in your initial list is good, as you can focus on the most experienced.

Initial Queries to Los Angeles Bankruptcy Attorneys
Once you have that list, you want to start making phone calls and sending emails, whichever is easier for you. You should confirm the attorney specializes in bankruptcy, knows federal laws, and can help you immediately.

Inquiring on Workload
You should also query the attorney on how much work they have, as well as who you will be working with directly. You don’t want to be one of 100 clients for one or two bankruptcy attorneys in a firm. You could ask them if they are overloaded, but just ask how much time they have to spend with you.

Asking on Fees for Bankruptcy Attorneys
Just as important as workload is affordability. Since not all Los Angeles bankruptcy attorneys are equal, have the same skills and degrees, you may not always want the cheapest or most expensive one. Choose an attorney who has helpful bankruptcy knowledge, can educate you on the process, has years experience, and does not charge a fortune. Hiring the first attorney you find may work out, but it rarely does; the same could be said of hiring the cheapest.

Hiring the Best Bankruptcy Attorney
Once you’ve made your list and inquiries, there will likely be a few standouts. You do want your attorney to be close so you can meet with him or her from time to time. Choosing may seem hard, but you don’t have to agonize over this. Be clear on rates, ask for references, and make an informed decision.

Filing Bankruptcy in Los Angeles
Does the idea of filing bankruptcy scare you? The sad truth is that many just like you feel the same way. A good Los Angeles bankruptcy attorney can offer guidance on how to handle your finances, how to clear debt, how to stop creditor harassment, and how to get a fresh start.

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Eligibility for Chapter 13 Bankruptcy and How to Fund It

Monday, April 5th, 2010

If you need of time to pay back bills, if you face possible foreclosure, or if you’re considering Chapter 7 bankruptcy, you may in fact need to file for Chapter 13 bankruptcy in your state. Chapter 13 bankruptcy is a good option for many individuals, but that’s the only people who can file Chapter 13, as businesses cannot file for it.

With bankruptcy law changes, if you make too much money you may be forced to file for a Chapter 13 bankruptcy repayment plan instead of filing for Chapter 7 bankruptcy. If you’re unsure, hire a professional bankruptcy lawyer in your state today.

So when is Chapter 13 bankruptcy a good option? How are you eligible? And how can you fund the repayment plan? Let’s go over these questions.

When Chapter 13 Bankruptcy is a Good Option
Chapter 13 bankruptcy does have advantages over Chapter 7 bankruptcy, but clear disadvantages as well. This is again a case where professional counsel, a bankruptcy lawyer, can help.

In essence, Chapter 13 bankruptcy does not liquidate your assets and discharge certain debts like Chapter 7 bankruptcy does. You are not free and clear a few months after filing. Chapter 13 bankruptcy is about getting more time to pay back debts; it’s often a solution for those who earn a lot of money but still cannot pay all their bills. Also, rich or not, if you fear your house will go into foreclosure, Chapter 13 bankruptcy and the court can grant you an “Automatic Stay” to buy you several months time. You still have to make your initial mortgage payment, but the repayment plan grants you several years to catch up in a fair way.

Eligibility for Chapter 13 Bankruptcy
As noted earlier, businesses are not eligible to file for Chapter 13 bankruptcy. Businesses typically file for Chapter 11 bankruptcy. However, business owners can file for Chapter 13 bankruptcy as an individual.

For individuals, the key to Chapter 13 bankruptcy filing is to show the court you have enough disposable income for the repayment plan. This means that after your allowed expenses and secured debts, you can still have enough money to complete the 3-5 year repayment plan. Your repayment plan must show how you will pay all these debts back in full, or the court will deny the filing.

Funds You Can Use for Repayment Plan
There is a variety of income you can use to fund your Chapter 13 plan. These can get complex, and that’s where professional bankruptcy lawyers can help you. You can definitely use regular wages or income from self employment, for example, and also Social Security benefits.

Other Rules of Chapter 13 Bankruptcy
You cannot owe too much money and file for Chapter 13 bankruptcy. The number changes every few years, but if you have over one million dollars in debt you might have too much to file. You also must be current on income tax filings.

Hiring Counsel
Hiring a professional bankruptcy lawyer can help you navigate all these laws with ease, save your home from foreclosure, grant you time to pay back debts, and give you a fresh start.

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Bankruptcy Decisions – When it Makes Sense to File for Chapter 7 or Chapter 13 Bankruptcy

Monday, March 29th, 2010

It’s often depressing to look at your finances, see you’re in debt over your head, and admit you have to file bankruptcy. While in many cases alternatives to bankruptcy do exist, whether it’s Chapter 7 or Chapter 13 personal bankruptcy, it’s often clear filing bankruptcy is your best option. Does that mean your house will go into foreclosure? How bad will it be?

In many cases, filing bankruptcy is a logical, if somewhat scary decision you make when you’re out of options. If you are financially in trouble when it comes to your home, job, health insurance, and credit card debt, filing bankruptcy is wise.

This needs to be said because many individuals and families struggle for far too long before they admit they need to file Chapter 7 or Chapter 13 bankruptcy. It’s almost considered giving up. By the time you do make the decision, you’ve lost a lot already and you’re worse than you would have been if you’d made the decision earlier. That goes against why bankruptcy was created–for helping individuals rebound from tough economic times, joblessness, and outstanding debts.

So when do you make the decision? Instead of blaming yourself, file early and take advantage of the law. “You can use Chapter 7, the most popular type, only once in eight years, so draw up a ‘no kidding’ plan for living on your income when you’re finally clear,” says Jane Bryant Quinn for Newsweek.

When to file Chapter 7 or Chapter 13 bankruptcy:
-When you still have assets to protect but you’re financially stuck
-Before you decide to pay back huge bills
-When tap IRAs and 401(k)s
-When you have outstanding medical bills (which can be canceled by bankruptcy)

Speaking of IRAs and 401Ks, you should never use these as an alternative to filing bankruptcy. After all, these are your future, and are meant to provide for you later, not now. These are mainly protected by bankruptcy, so ask your bankruptcy attorney about them.

Never wait for medical treatment–dental, eye, or otherwise–because you are out of money. These can be part of your Chapter 7 bankruptcy filing, or paid back in a reasonable amount of time with Chapter 13 bankruptcy.

Since you can use Chapter 7 bankruptcy once every 8 years, it’s a clear alternative to tapping into funds your future depends on.

So how do you make the decision between Chapter 7 and Chapter 13 bankruptcy? With new bankruptcy laws, Chapter 7 bankruptcy is off the table for many. Now, people are being told to file for Chapter 13 bankruptcy. In short, Chapter 7 bankruptcy clears the majority of your debt, from mortgages, to medical bills, to credit cards. There are some nonexempt items which you may lose here.

Chapter 13 bankruptcy is less about canceling debt and  more about creating a longer time frame for repayment. If you make too much money, you may be forced to file Chapter 13 bankruptcy instead of Chapter 7.

Choosing between the two calls for 1) research and 2) professional counsel. Hiring a professional bankruptcy attorney ensures your financial future will be safe.

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