 |
 |
||
 |
Bankruptcy
& Chapter 13 Our firm has over 20 years experience providing bankruptcy services to the public. We do more than just prepare forms. We are a law firm. We render legal advice and represent you in court. We
provide personal service which addresses your particular needs.
Your case will be handled by a licensed attorney, not a paralegal
or legal assistant.
Click
here NOW to access our Bankruptcy Questionnaire and filing requirements A Chapter 7 or Chapter 13 Bankruptcy will enable you to:
THE WORLD HAS CHANGEDIn 2005 Congress passed and the president signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, the "BAPCPA". This Act brought about the most extensive changes in the Bankruptcy Code since 1978 and made filing consumer bankruptcy (particularly Chapter 7) much more difficult. Although the new law has added much complexity and additional duties for debtors and their attorneys, Bankruptcy Relief is still available ! BASIC ASPECTS OF CONSUMER BANKRUPTCYThe bankruptcy laws are designed to relieve the honest debtor of the debts that he cannot repay. "Bankrupt" refers to a state or condition where one is unable to pay his debts as they are, or become, due." Black's Law Dictionary. Bankruptcy is a federal court proceeding designed to provide individuals and business with a means of addressing and managing debt. Individual consumer debtors most commonly file under Chapter 7 or Chapter 13 of the Bankruptcy Code. The objective under each of these chapters is for the debtor to obtain a Discharge, a court order relieving the debtor of his debts. Click here NOW to access our Bankruptcy Questionnaire and filing requirementsTHE AUTOMATIC STAYImmediately upon the filing of a petition in bankruptcy under Chapter 7 or Chapter 13 there is an automatic and immediate stay which operates as an injunction to prohibit the commencement or continuation of collection activity against a debtor, including lawsuits, garnishments, foreclosures, repossessions, harassing telephone calls and most collection activities against the debtor. There are exceptions to the automatic stay, several which are the result of the new bankruptcy law, which will be discussed below. CHAPTER 7 BANKRUPTCYChapter 7 is
commonly referred to as "liquidation" or "straight"
bankruptcy. In Chapter 7, the debtor discloses and places all his
or her assets under the authority of a Trustee, appointed by the
Bankruptcy Court, in exchange for a Discharge, a release from or
forgiveness of all his or her dischargeable debts. The trustee is
charged with the task of liquidating all the debtor's nonexempt
assets, turning them into cash, and paying the claims of the creditors
from the available funds. There are exemptions under law which allow
the debtor to retain a minimum level of property so that the debtor
of modest means will typically be able to retain most, if not all,
of his or her possessions. Chapter 7 is available only to debtors
whose income falls at or below median income, as determined by the
United States Trustee, and to debtors who have no disposable Chapter 7 is best suited to debtors with very low income and minimal assets. Chapter 7 is designed to give debtors a fresh start allowing them to proceed in life without the looming specter of overwhelming debt. Although the Discharge is broad in scope, there are a number of debts which cannot be discharged in chapter 7, these include: child support and domestic support obligations, student loans, most taxes, debts based upon fraud, embezzlement, false statements in writing, criminal fines, willful or malicious injuries to persons or property, injuries associated with driving or operating a vessel while intoxicated, to name a few. Click here NOW to access our Bankruptcy Questionnaire and filing requirementsCHAPTER 7 DISCHARGEA discharge in bankruptcy under chapter 7 relieves the debtor of all dischargeable debts, operates to void any judgment to the extent that it is a determination of personal liability, operates as an injunction against the commencement or continuation of any action, lawsuit, or process to collect or recover a debt. However, it does not relieve the debtor of certain "non-dischargeable" debts which include student loans, most taxes, child support and most debts associated with a divorce or dissolution of marriage, debts resulting from fraud, embezzlement or criminal activity, and debts related to driving (or boating, or flying) while intoxicated. CHAPTER 13 BANKRUPTCYChapter 13 is commonly referred to as a "wage earner plan" or debt adjustment plan. Chapter 13 is only available to individuals who have "regular income" from wages or other sources. In Chapter 13, the debtor typically retains all his or her property and files a plan to repay creditors in full, or in part. As in other bankruptcy proceedings, a Chapter 13 debtor must disclose all of his property, assets, income, expenses and creditors in his documents filed with the court. A Chapter 13 filing further assumes that the debtor has "disposable income" in excess of his basic living expenses. The debtor's chapter 13 plan must pay essentially all of the "disposable income" on a monthly basis to the Chapter 13 Trustee . This monthly payment will be applied towards payment of the claims of creditors and the administrative expenses of the chapter 13 case. To be confirmed and approved by the court, a Chapter 13 Plan must provide that the debtor make his or her best efforts to repay creditors over a period of 36 months (for debtors at or below median income) and 60 months (for debtors above median income). A Chapter 13 Plan must also pay creditors as much as they would receive if the debtor filed a Chapter 7 and the debtor's nonexempt property was sold to pay and the funds used to pay creditors. Chapter 13 is available to nearly any individual experiencing financial difficulty. Chapter 13 is designed to allow the debtor to repay what he or she can afford over the life of the plan, which is typically only a fraction of the actual debt owed. Among its other attributes, a Chapter 13 filing allows a debtor to Stop Foreclosures, Stop Repossessions, Stop Garnishments, Stop Lawsuits, Stop IRS Tax Levies, Reorganize, Adjust Debts and stretch out payments for up to Five Years. CHAPTER 13 DISCHARGEA discharge under Chapter 13 relieves the debtor of the same debts that are dischargeable under Chapter 7, but also provides a means to cure mortgage and auto loan arrearages and repay debts for taxes, child support and other non-dischargeable obligations over a period of up to five years. Click here NOW to access our Bankruptcy Questionnaire and filing requirementsCHANGES UNDER THE NEW BANKRUPTCY ACTThe Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 has brought about a number of changes for consumers filing bankruptcy, including the following: CREDIT COUNSELINGTo be eligible
for bankruptcy, all individual debtors must have received credit
counseling from an approved credit counseling agency within 180
days before filing. A Certificate of Completion must be filed with
the petition or the case will be dismissed. Very limited exceptions
apply in emergency situations. Additionally, in order to receive
a discharge, all debtors in Chapter 7 and Chapter 13 must also attend
a financial education course after filing. IF YOU ARE CONSIDERING
FILING BANKRUPTCY WITHIN THE NEXT SIX MONTHS, YOU MUST COMPLETE
THE APPROVED NONPROFIT CREDIT COUNSELING. MEANS TESTINGThe new bankruptcy law is designed to limit and restrict the consumer's ability to file Chapter 7 bankruptcy. Accordingly, the new code implements a "means testing" procedure to determine whether the debtor has the ability to pay back all or a part of his or her debt. If the court is convinced that a debtor has the ability to pay at least $100.00 per month to his creditors, that debtor will most likely be required to file under Chapter 13. To determine the debtor's ability to pay, the debtor is required to produce 6 months of payroll stubs or other proof of income, so that his "ability to pay" is based upon is average income for the last six months. The debtor's average monthly income is then compared to the average monthly income ("median income") as determined by the US Department of Justice for households in the County where the debtor resides. If the debtor's household income is more than the "median income" he will most likely be disqualified for chapter 7, and only chapter 13 will be available. If the debtor is above median income in chapter 13, he or she will need to pay 60 months of plan payments, as opposed to 36 month plans for those debtors at or below median income. The Department of Justice has also developed allowable spending limits (or ceilings) for household living expenses for each county in the country, which are compared to the debtor's actual living expenses. In other words, if you are "living too high" the government will decide what your living expenses should be, and, if it appears you "should" have "disposable income" left over, then you will need to file a chapter 13 payment plan. Click here NOW to access our Bankruptcy Questionnaire and filing requirements
|
||