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Recent Blog Posts
What is the Texas Homestead Exemption?
Before heading into a personal bankruptcy, it is helpful to know as much as possible about federal and state laws and rules affecting your case. Texas has very unique homestead laws that you should know about before petitioning for bankruptcy. If you are thinking about bankruptcy as an option, talking over your situation with an attorney could be extremely helpful for getting your questions answered and putting you at ease.
If you file for bankruptcy, you can protect the total value of your home under this exemption. It’s important to note that there are several critical stipulations in order for a homeowner to be eligible for this exemption. A rural homestead for the head of the family cannot be more than 200 acres including the space the property is located on and a single adult cannot claim any more than 100 acres. In an urban area, the space is limited to ten acres.
Knowing Your Rights with Debt Collectors
Maybe you are waiting to contact a bankruptcy attorney because you think that the collection calls will stop. Maybe you are feeling overwhelmed and embarrassed by the situation. Rest assured that bankruptcy can happen to anyone and that you should not be afraid to reach out for help. One financial setback like the loss of a job or a serious accident can affect your finances dramatically. Once those phone calls start coming in, however, it can raise some questions about what creditors are and aren’t allowed to do or say when they are contacting you about a debt.
In Texas, your rights are protected under the Texas Debt Collection Act. This law outlines how and when creditors can contact you, but it is also stipulates what is illegal. This law is attempting to cut down on the abusive, unfair, or fraudulent debt collection attempts that have made life frustrating for individuals throughout Texas.
Protecting Yourself From Refinancing Scams
Believe it or not, financial scammers often do not target the wealthiest individuals. Instead, those facing financial pressures and even considering bankruptcy are most often victimized. Those with money problems may painted into a corner, under immense stress, willing to do whatever it takes for a fresh start, and more susceptible to the dubious claims of scam artists.
Staying educated on the tricks of these con artists will help protect you from falling into their trap. How do scammers seek to steal from vulnerable Texas residents? A few of the most common scams include:
Home Affordable Refinance Program Scams (“HARP”): HARP is a program available to those who are not behind on their mortgage but have difficulty refinancing. Scam artists are well aware that this program exists. They may try to contact you by phone or through the mail, claim that you qualify for HARP support, and ask for money to work through the process on your behalf. The only way to truly know if you qualify for HARP is to check HARP’s website, or contact your mortgage lender. Eligibility for HARP is based on a number of factors listed by HARP. If you are not sure you can check Freddie Mac’s website to gauge your potential eligibility for HARP.
Unfortunately, scammers often use HARP as a way to funnel money their way. The main thing to look out for are third parties asking for large fees to help you take advantage of the program.
Can Anyone Stop my Personal Bankruptcy?
Filing for bankruptcy is a great financial tool for people who have accrued too much debt to handle responsibly. Maybe you lost your job and do not want to lose your house. There are several kinds of bankruptcy for which a person or a business can file. A chapter 7 can eliminate credit card balances, unpaid medical bills, tax penalties and other unsecured debt. On the other hand, a chapter 13 allows you to repay a portion of your debts if you have the means to do so and have the rest forgiven.
While this seems beneficial to anyone with unmanageable debts, there are ways that your bankruptcy might not discharge your debts. During a required meeting with your creditors, objections may be raised as to prevent you from eliminating some or all of your debts.
What is a Chapter 20 Bankruptcy?
A Chapter 7 bankruptcy is a common form of bankruptcy because it excuses the filer from all eligible debts. It is commonly referred to as a liquidation bankruptcy because debts are eliminated by the sale of property and other assets. Creditors are repaid through the proceeds of those transactions.
A Chapter 13 is also called the wage-earner’s bankruptcy. If someone is earning an income but cannot keep up with past due payments, then a Chapter 13 bankruptcy can give them time to pay those debts. There is a repayment plan that last from three to five years and is based on each person’s income.
Occasionally there are cases when nether Chapter of bankruptcy is appropriate. While a Chapter 20 bankruptcy is not a term found in the bankruptcy code, it is a common strategy to get a fresh start. It is the process of filing two bankruptcies right after each other to resolve difficult financial situations. The approach is filing for Chapter 7 protection and then for Chapter 13.
What You Need to Know Before Filing for Bankruptcy
If you are considering filing for bankruptcy in Texas, there are several things to consider before filing. While bankruptcy is a great way for many Americans to discharge or reorganize their debt, it could actually be a detriment for some families. In the wake of the Great Recession, the number of personal bankruptcies rose, according to a report from the Columbia Law School. In 2011, according to the report, bankruptcy filing “totaled about 5,800 per million individuals, meaning about one in every 175 Americans filed for bankruptcy protection.” This number was even higher in 2010, during which one in every 150 Americans filed. 
Now that the Recession has receded, many families that were close to insolvency are now on solid financial ground. Because of bankruptcy’s prevalence, however, many people who could otherwise solve their debts differently may think bankruptcy is their only option. The first step to determine if you should file for bankruptcy, according to the USA Today is to determine if you are judgment proof. “If you’re judgment proof,” according to Lawyers.com, “creditors can do virtually nothing legally to obtain money or property from you.” Examples of individuals who are judgment proof are those who have no assets to be collected, have insufficient property to pay a creditor’s claim, or who are protected by laws “that exclude wages and property from being used to pay a debt.”
Bankruptcy Terminology: What is Reaffirmation?
Filing for bankruptcy is a difficult decision. However, bankruptcy is an important tool that gives people a second chance despite the curve balls that life may throw. Indeed, the reason behind the United States Bankruptcy Code is an acknowledgment of the reality that life sometimes just happens.
It is unfortunate that bankruptcy has such a negative stigma. Bankruptcy is an invaluable tool, and if used properly, it allows persons to shed off undesired liabilities while retaining useful assets; just ask Donald Trump.
With proper planning, bankruptcy can even allow a person to continue inhabiting the same home or drive the same car while getting rid of undesired debt. This is all thanks to the concept of reaffirmation. Reaffirmation allows bankruptcy filers to choose to remain liable for the debt that encumbers certain assets, thus keeping those assets.
For example, assume that a person who decides to file for bankruptcy wants to keep a car that they have financed; this may be the vehicle used to make a living or to drive children to school. Under bankruptcy rules, if a person does not reaffirm the debt associated with the car, the bank that financed the purchase would repossess the vehicle and dispose of it as they see fit.
State of Economy in Texas Remains Political Issue
With the gubernatorial race upon us, and local elections being decided throughout the country, the public will surely continue to be inundated with political ad campaigns and candidates’ appearances throughout the region. One of the most discussed issues involves Texas’ economy, and the correlated issues of unemployment rates and the public debt.
According to My San Antonio, Attorney General Greg Abbott, who is running for the 2014 GOP gubernatorial nomination, stated during a recent campaign appearance that Texas’ debt ranks as the second highest among large states in the U.S., while San Antonio holds the highest debt of any city within the state. While this state of affairs is concerning, especially considering the recent actions of cities in financial crisis in other parts of the country, perhaps the public can find some reassurance in the fact that the elections will call attention to these issues and potentially produce proposed resolutions.
A New Baby Could be a Good Time for Financial Fresh-Start
There are usually all kinds of planning and important decisions to be made when a couple has a new baby on the way. And many of those plans are expensive ones. According to the U.S. Department of Agriculture (USDA), it costs a middle-income family almost a quarter of a million dollars to raise that child from infancy to age 18 – and that’s excluding college tuition.
The UDSA’s new report breaks down as follows:
- Families earning between $60,640 and $105,000 (pretax) will spend $241,080.
- Families earning less than $60,640 will spend $173,490.
- Families earning more than $105,000 will spend $399,780.
The report cites the two largest expenses as housing (33 percent) and child care/education (23 percent). The third-highest expense is food (18 percent). Although parents may be tempted to overspend in other areas, none of these three categories are arbitrary ones.
What Does an IRS Tax Levy Mean in Texas?
Since the economy has taken a turn for the worse, the IRS has be relatively aggressive in coming after income tax debt. If you are being contacted by the IRS about existing tax debt and you are feeling overwhelmed with your finances, you need the advice of a San Antonio bankruptcy attorney.
The IRS can use levies to pay your taxes if you do not make payments or arrangements for payments to cover a tax debt. The IRS can take and sell any type of personal property that you own or have interest in. This includes the cash loan value of your life insurance policy, commissions, your wages, bank accounts, licenses, rental income, dividends, and retirement accounts. The IRS may also seize and sell property such as houses, boats or cars.
The tax levy can be completed after the IRS assessed the tax and provided you with a Notice and Demand for Payment, you refused to pay the tax or ignored the notice, and you received a "Final Notice of Intent to Levy and Notice of Your Right to a Hearing." Generally, you will receive this last piece of information about 30 days before the levy. Taxes are extremely complicated and contacting the IRS may not clear up your questions. This is a sign to reach out to a bankruptcy lawyer.
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