Posted on September 07, 2015 in Bankruptcy

If you’re hurting financially and getting pressured to sell your home, first get bankruptcy advice to potentially save you lots of money.

Do you have serious financial pressures inducing you to sell your home? Those pressures may be from your mortgage lender itself or other home-related debts like property taxes, a second mortgage, or some other creditor that has put a lien on the home, such as the IRS or your state income tax agency. Or you may have other debts not related to your home but which put your home in jeopardy because they suck money away from your mortgage payments.

So these pressures may be tempting you to hurriedly sell your home, or to just give it up to your mortgage lender. But if you rush to sell your home (or surrender it) you could lose out on the opportunity to keep it through the tools of bankruptcy. Some of those tools may even create equity in your home, making it economically more worthwhile to save. Or maybe you would be enabled to still sell it, but do so later (even a couple years later) at a higher price and/or when the timing is better for you.

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 Posted on September 04, 2015 in Creditor Lawsuits

Don't let a creditor get a judgment against you. File a bankruptcy case before that can happen.

It’s All Too Easy for a Creditor to Get a Judgment against You

If you are seriously behind on payments to a creditor, you can end up with a court judgment against you and a judgment lien against your home even if you act with what seems like common sense.

Let’s say you’ve fallen behind on a debt because you simply didn’t have the money to pay it. You get some papers in the mail or handed to you saying that you are being sued and that you need to pay the entire balance. You don’t have the money to pay hardly anything and certainly not the full amount. You know you do owe the debt so you see no reason to dispute that you do. So you don’t see any point to paying an attorney to fight the lawsuit. And you don’t see any good coming from contacting the creditor’s attorney yourself or to trying to file any kind of response to the lawsuit.

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 Posted on September 02, 2015 in Vehicle Loans

Bankruptcy can save your truck or vehicle various ways. Enable you to pay for it by wiping out other debts. Or even likely pay less for it.

The Pleasant Surprises of Bankruptcy

Most of the time people go to see a bankruptcy attorney they are pleasantly surprised by what options are available to them. An important reason to see a bankruptcy attorney sooner rather than later is because then you will more likely be able to take advantage of those options. That’s very much true when it comes to your vehicle loan.

Surrender or Repossession Is Usually Very Expensive

Whether or not you should use bankruptcy to save your car or truck, surrendering it without having a well-informed game plan about what to do next is almost never a good idea. And worse is putting yourself into a situation that it gets repossessed.

Almost always if you surrender your vehicle or it gets repossessed you will end up owing money on the debt. After your creditor sells the vehicle and credits the sale proceeds against your account you will usually owe much more than you expect. Often shockingly more.

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 Posted on August 31, 2015 in Bankruptcy Law

Doing what you believe is the right thing can backfire, if you pay a special creditor before you file bankruptcy.

“Preference” Payments

Bankruptcy law focuses for most purposes on what you own and who you owe at the moment your bankruptcy case is filed. But there are some limited yet potentially dangerous ways that the law can look into the past. “Preference” payments are one example.

Here’s what the law says. If during the one year before you file a bankruptcy case, you pay one creditor more than you are paying at that time to your other creditors, then after you file bankruptcy that favored creditor could be required to pay back the money you’d paid, not back to you but rather to your bankruptcy trustee, for distribution to all of your creditors.

For example, if you received an income tax refund and used $1,500 of it to pay off a debt to your brother, and then six months later you filed a bankruptcy case, your brother could be required to pay that $1,500 to the trustee. The trustee would then divvy up the $1,500 among your creditors as prescribed by law. Your brother would likely get just a tiny portion of that money, based on his pro rata share of all your debts.

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 Posted on August 28, 2015 in Bankruptcy

Give both you, AND your assets, a fresh financial start.

Getting the Most Out of Your Bankruptcy

When you’re considering bankruptcy your mind is likely mostly on how to deal with your debts. You’re focused on getting a handle on the negative side of your balance sheet. But getting a financial fresh start also means protecting your assets—the positive side of your balance sheet. You can get much more benefit out of bankruptcy by not selling, using up, or borrowing against what you own BEFORE filing your bankruptcy case.

It’s certainly understandable that you might sell some stuff to pay essential debts or expenses. And it may make sense at the time to use savings or some other precious funds set aside for retirement or some other long-term purpose in order to make debt payments. And who hasn’t been tempted to borrow against their home or life insurance or retirement fund to keep their heads above water?

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 Posted on August 26, 2015 in Bankruptcy

Decisions that seem to make sense at the time can end up being against your best interest. Here’s what to look out for.

Giving Our Clients Good News

As bankruptcy attorneys, we chose this kind of law to work in because we really want to help people. We have the privilege of listening to people’s tough stories and then giving them good news about how they can greatly improve their lives. We show how they can now get immediate relief from their debts, create a workable plan to save their home, or a great way to solve a seemingly impossible situation involving unpaid child support or a wage garnishment for income taxes. On a good day we help anxious people learn about solutions they did not realize they had.

On a tougher day we find out that we could have helped someone much more if only they would have not have made some seemingly sensible-at-the-time decision.

The goal of our next few blog posts is to help you avoid these self-inflicted wounds.

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 Posted on August 24, 2015 in Bankruptcy Options

Although either kind of bankruptcy will stop an approaching foreclosure, which one should you choose?

Today’s blog post is summarized by this sentence:

Generally, file a Chapter 7 “straight bankruptcy” if it buys you enough time, and otherwise file a Chapter 13 “adjustment of debts” if you need your more time, but like so much in life it really depends on all your circumstances, with some examples of when Chapter 7 would be appropriate and a list of special advantages that Chapter 13 can get you.

The Simplistic Guideline

If you are behind on your mortgage payments, and definitely want to keep your home, then the simple rule is to file a Chapter 7 case if it enables you to catch up on your back mortgage payments and any other house-related debts (like property taxes) as fast as you need to; otherwise file a Chapter 13 case to give you much more time.

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 Posted on August 21, 2015 in Foreclosure

Either Chapter 7 or 13 will stop a foreclosure, even if your lender unintentionally or purposely proceeds with the foreclosure sale.

Here’s a one-sentence summary of today’s blog post:

Bankruptcy’s “automatic stay” will stop a foreclosure, forcing your mortgage lender’s cooperation, but in the rare event your lender unintentionally or purposely proceeds with the foreclosure sale it will be ineffective and your home will still be yours, whether you file a Chapter 7 or Chapter 13 case.

The “Automatic Stay” Prevents a Home Foreclosure

In our last blog post a couple of days ago we described the “automatic stay” as the immediate stopping of virtually all collection actions of your creditors. Especially if you are racing to stop a foreclosure, this powerful tool is one of the most important benefits of filing bankruptcy.

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 Posted on August 19, 2015 in Automatic Stay

Almost all attempts by creditors to collect debts are immediately stopped when you file bankruptcy. But here are some special exceptions.

Here’s a one-sentence summary of today’s blog post:

The “automatic stay” gives you crucial protection from creditor collections as soon as your bankruptcy case is filed, with some limited exceptions in 1) criminal matters, 2) certain domestic relations (family court) procedures, 3) child and spousal support obligations and procedures, and 4) certain income and business tax collection.

The “Automatic Stay”

The immediate stopping of collections—called the “automatic stay”—is one of the most important benefits of filing bankruptcy.

It’s automatic in that it‘s put into full effect by the act of filing bankruptcy itself. The automatic stay doesn’t need any action by a bankruptcy judge or any other procedure to become effective.

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 Posted on August 17, 2015 in Mortgage

Here are 5 additional tools that come with Chapter 13, each one neatly solving a different challenge to your home.

Here’s a summary of today’s blog post:

Adding to the 5 tools in our last blog post, today’s 5 include: 6) protecting your home equity if it’s greater than the homestead exemption, 7) giving you much more time to live in your home before selling it, 8) dealing effectively with child/spousal support liens against your home, 9) resolving an income tax lien on dischargeable income taxes, and 10) preventing foreclosure from overdue property taxes.

6. Avoid a Chapter 7 Trustee from Taking Your Home for Having Too Much Equity

If you have more equity in your home than the homestead exemption allows, you risk losing your home if you file a Chapter 7 “straight bankruptcy” case. The homestead exemption amount can differ state to state. Chapter 7 trustees have a lot of discretion about pursuing assets, and so it’s difficult to predict how aggressive yours will be about your home. If the amount of your equity is anywhere close to the homestead exemption maximum, you take a risk in filing a Chapter 7 case.

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