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Filing Bankruptcy Under Chapter 13 May Wipe Out Your 2nd Mortgage

September 8th, 2010

It probably won’t surprise you, as an Orlando bankruptcy lawyer, I have seen it first hand: Orlando home values are on the decline, according to an article published recently in the Orlando Sentinel.

Unfortunately, the same can be said for real estate in almost all areas of Florida. It seems everyone is underwater on their homes. In the past few years, many of my Orlando bankruptcy clients have benefited from the ability, in a Chapter 13 case, for their Orlando bankruptcy lawyer to file a motion in their case which allows them to completely wipe out the balance owed on a 2nd mortgage.

To be eligible for this type of relief, you must be able show, through an appraisal of your property, that the value of the property is less than what is owed on the 1st mortgage. In a recent blog by a well respected Illinois and Wisconsin bankruptcy attorney, David Leibowitz, David points out the options available to people with regard to stripping of a lien (second mortgage) on their home.

Since the decline in the economy, there has been some question over whether a person filing bankruptcy under Chapter 7 could qualify to strip a 2nd mortgage. Recently, this question came before an Orlando bankruptcy Judge and she issued an opinion stating that lien stripping is only available under Chapter 13 bankruptcy. Just filing bankruptcy under Chapter 13 is not enough, you must also complete your Chapter 13 plan by making all payments due under the plan and have your Discharge Order entered by the Judge prior to the mortgage being eliminated.

With any luck, the Orlando housing market will rebound in the near future. At which time, once my Orlando Chapter 13 bankruptcy clients have finished making their payments under the plan, they will successfully strip away their 2nd mortgages and once again have equity in their homes.

By filing bankruptcy under Chapter 13, my clients can attain this goal, along with many others, including saving on their car loans and wiping out credit card debt. With the help of an experienced bankruptcy attorney, debt relief is possible.

If you are considering filing for bankruptcy, make sure you hire an experienced bankruptcy lawyer to work for you. Do you have more questions about filing for bankruptcy before you take the plunge? Check out K. Hunter Goff’s FREE eCourse.


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Chapter 7 Bankruptcy Now Has A Means Test

September 6th, 2010

Of all the various chapters for filing bankruptcy in the US, chapters 7 and 13 are the most popular. In fact 85% of all filings are under chapter 7, probably as this is perceived as the “best” type of bankruptcy, leaving the debtor free from any debt on discharge, unlike chapter 13 where debts have to be repaid under a repayment plan.

Even though all the individuals possessions are sold under chapter 7, the end result of freedom from debt makes chapter 7 the most popular for the debtor, but perhaps the least popular for the creditor.

This is because that although the debtor loses virtually everything, the creditor often recovers very little.

In the past, creditors lost out when sometimes they need not have done, as some people hid the true size of their wealth and used chapter 7 merely to get rid of debt that they could have afforded to repay, had their debts been restructured under a chapter 13 filing.

Therefore, 2005 saw the introduction of a compulsory means test for individuals seeking chapter 7 bankruptcy, failure of which would automatically push them into a chapter 13 filing, which is a 3-5 year repayment plan.

The means test has a number of stages, the first being a calculation of the debtor’s disposable income, based on their earnings over the previous 6 months and deducting various living expenses.

The first stage is to calculate what the applicant’s disposable income has been over the previous 6 months. In other words deducting what the court considers to be reasonable amounts for living expenses for example and seeing what’s left.

There are then two more steps. The first takes your previously calculated “disposable income” figure and compares this against the median income for a family of the same size in your state. If your income is less than this, you do not need to take part 2 of the test as you automatically qualify for chapter 7.

If you income is found to be greater than the median then you have to go through some complicated calculations. The problem an individual faces once they fail the first part of the test, is determining if your “disposable income” figure is sufficient, after paying monthly “allowed” expenses, to pay at least a proportion of your unsecured debts (credit cards for example).

The point is that you should really get professional legal advice before filing bankruptcy, so you can be properly prepared.

Bankruptcy is a drastic step, in spite of what other people may tell you. It can devastate your financial future as your credit score drops. Although chapter 7 is the most common form of bankruptcy, it may be worth looking at chapter 13 bankruptcy law. If you would like further free information and advice, visit www.chapter13bankruptcylaw.net.


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Divorce And Bankruptcy: Credit Card Debt

September 4th, 2010

A sad truth that any bankruptcy lawyer can tell you is that filing for bankruptcy and filing for divorce go together like peanut butter and jelly. As an Orlando bankruptcy lawyer, I have represented clients with money problems for many years and can tell you that many people file bankruptcy as a result of a divorce.

The issue of divorce and bankruptcy is so common with my clients, and the two are linked so well, I will be publishing more articles on the matter. However, this article will be devoted to the effect of filing bankruptcy and filing for divorce has on an individual spouse and any credit card debts they may owe.

The most important thing to remember when discussing divorce and credit card debt, is that the only ones party to your divorce are you and your spouse. That is, a third party, like your and your spouse’s creditors, are NOT part of your divorce proceedings and consequently, are not obligated to abide by your marital settlement agreement.

When separating, it is common for people to assign which debts each spouse will be responsible for after the divorce is finalized. These terms are often memorialized in a marital settlement agreement. This agreement legally binds the parities seeking the split-up to the terms included in the agreement. However, each spouse’s creditors rely on the credit card agreement, the car loan, the house loan, etc., that each spouse signed with the creditor at the time the credit was issued. Frankly, creditors could not care less how you decide to divide the debts between the two of you when you part, and the law is on their side.

Bottom lineIf you each were obligated to the creditor before the divorce, no matter how you decide to divide responsibility for the debt amongst yourselves, you are each still liable to the creditor after you part ways.

Hence, when one spouse discharges their liability for the debts by filing bankruptcy, the other non-filing spouse will continue to be responsible for it. In order to remove that responsibility, the non-filing spouse can attempt to settle the debt with the creditors in question, or end up filing bankruptcy themselves.

Bankruptcy and Divorce invite many complex legal issues. Over next weeks and months I will be discussing the common issues faced in Bankruptcy and Divorce in my blog.

For more information about filing bankruptcy, please check out this FREE E-COURSE from your Orlando bankruptcy lawyer. Also published at Divorce And Bankruptcy: Credit Card Debt.


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Benefits Of Hiring A Bankruptcy Lawyer

September 4th, 2010

Each year, many individuals are struggling with huge debt problems and the majority of them don’t have any way to cope with these debt problems. To them, the debt problem in their life is imperative and they don’t know the way to prevail over this predicament. A lot of these debt complications have developed in recent times because of the severe economic conditions.

For anyone who is struggling with the debt issues and you don’t have means to pay back your monthly payments, you should consider bankruptcy. You’ll have to get in touch with a professional bankruptcy lawyer if you’re interested in taking necessary legal measures.

Bankruptcy guidelines and procedures have evolved a great deal in the past few years. So if you are desperate to get out from your unsecured debt and are seeking bankruptcy, it may be challenging to get approved nowadays. Governments and services now demand their money back and they’ll seek every possible way to take money from their customers. So if you would like to apply for bankruptcy, don’t move forward without a professional bankruptcy lawyer.

The very first place to find a bankruptcy lawyer will be your State Bar Association. When looking for a professional bankruptcy lawyer, he or she will need to have approval from the American Bankruptcy Institute. The Bar Association should have a referral system and you should use their service for locating an experienced bankruptcy lawyer.

Normally bankruptcy lawyers will probably be linked to various organizations and you can get a lot of information from these sources. You also can utilize the net to learn more about your desired bankruptcy lawyer. Your research will certainly uncover if your preferred lawyer has any issues or complaints from others.

Together with the guidance of a reputed bankruptcy lawyer, you should be able to get your bankruptcy approval without any kind of issues and waiting. Specialized bankruptcy lawyers will handle the legal authorities and arrange the required paperwork to get a timely approval of your bankruptcy claim.

Related: how much does bankruptcy cost | will bankruptcy ruin my credit


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In Chapter 13 Bankruptcy, What’s The Plan?

September 4th, 2010

It helps to have a plan. In life. In business. In relationships. Plans are good things. So to, in Chapter 13 bankruptcy, having a plan is not only a good idea, it’s the law!

As an Orlando bankruptcy lawyer, I help my clients formulate a Chapter 13 payment plan to accomplish their financial goals. Depending on my client’s situation, through their payment plan, which can usually last anywhere from 36 to 60 months, I can help them catch up a mortgage payment, eliminate a second mortgage altogether, wipe out credit card debt, save money on a car loan, or handle IRS debt.

The Debtor, the person filing the Chapter 13 bankruptcy, has to file a payment plan at the outset of the case. The plan’s job is to tell everyone what goals the Debtor wants to achieve during the time the Debtor is in bankruptcy. The plan also instructs creditors how they will be dealt with, and tells the Chapter 13 Trustee who to pay and how much to pay each creditor.

The Debtor has several options to choose from when creating a chapter 13 plan. Too often in Court I see folks try to develop a plan with no idea how to express what they want to do in the plan in a way that can be understood by anyone. The result is that the plan gets objected to, or the Debtor’s case gets dismissed by the Trustee. This is bad because then the Debtor has filed bankruptcy and got nothing from it.

If you want a good result from your Chapter 13 case, hiring an experienced Orlando bankruptcy lawyer is a great place to start. In almost all of my cases, so long as my client keeps up with the Trustee payment during the plan, my client will never see the inside of the Bankruptcy Court. Even better, my clients will have met all of the goals they wanted to achieve when their case was filed.

In Chapter 13 cases, it’s all about having a plan. A plan that gets you through the Chapter 13 process and wipes out your debt is even better.

Learn more about Chapter 13 bankruptcy. Stop by K. Hunter Goff’s site where you can find an experienced Orlando bankruptcy lawyer and learn how he can help you.


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Filing Bankruptcy? How Much Do You Have To Owe?

September 2nd, 2010

Grampy used to tell me when I was a kid, that if I ate my Lima Beans (Gross!) they would give me a hairy chest! So I believed him! After all, I looked up to my Grampy; he was the smartest, most brilliant man I knew. AND he could even bend a spoon just by looking at it! However, as time goes by, you learn that if you rely on unchecked “truths” you can really get burned in life.

A common myth is the source of a popular question I answer frequently. When they come to my office for their first meeting, to receive their free evaluation, I am regularly asked by my Orlando bankruptcy clients is this: “Are my debts high enough to file for bankruptcy?”

Douglas Jacobs, a California bankruptcy attorney, brings up the question of “Do I qualify to File for Bankruptcy?” in a recent blog. He answers this question with a simple “Yes”. I concur, almost everyone qualifies to file bankruptcy of some type. The more pertinent question, in my opinion: “Should I file for bankruptcy?” Only after an experienced bankruptcy lawyer evaluates your complete financial situation, will this question will be answered.

When filing a Chapter 7 bankruptcy, the legal system does not put restrictions on the amount of debt you can owe to your creditors. So, when determining whether a person qualifies to file a Chapter 7 bankruptcy, how much or how little that person owes to their creditors is not relevant. However, there are limitations on the amount of debt you can have when you file a Chapter 13 bankruptcy, but it is not a question of whether you owe enough, but whether you owe too much.

As an Orlando bankruptcy lawyer, I know first hand that the Chapter 13 Trustee in Orlando looks very closely at whether Debtors exceed the debt limitations of Chapter 13 and will file a Motion to Dismiss the case if the debt limits are exceeded. Specifically, if you owe more than $360,475 in unsecured debt (think credit cards, medical bills, signature loans) or more than $1,081,400 in secured debt (think home loans and car loans), you could face a motion to dismiss in Orlando.

The number of myths about bankruptcy are staggering, and it is unclear where most of them originated. As an Orlando bankruptcy lawyer, I believe the myth about having to owe a certain amount to file for bankruptcy ranks prominently on the list of the top bankruptcy myths.

With the knowledge you’ve gained, you now know that you will probably be able to file some type of bankruptcy. Your next step should be to contact an experienced bankruptcy lawyer to review your financial situation. This myth, and many others you may have heard about bankruptcy can be put to rest by a knowledgeable bankruptcy lawyer.

Do you have questions about filing for bankruptcy? Check out K. Hunter Goff’s FREE eCourse. Hire an experienced bankruptcy lawyer to work for you.


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Bankruptcy Relief And Your Credit Score

September 2nd, 2010

Every day, I speak with clients and potential clients who are considering a bankruptcy filing, who seek my advice as an Orlando bankruptcy lawyer. One of the first things that I am told is that they have an “A++” credit score or “850 Beacon Score”, before we even talk about the amount of debt the person owes or how filing for bankruptcy may help him or her.

“That’s nice”, I might say, and then ask them to “tell me about the money you have saved up for retirement, tell me about the discretionary income you have each month, and tell me how nice it is to not have to make 8 different minimum monthly payments each month to credit cards”.

Dead silence.

You see, the banking industry that promotes and relies on your credit score, as well as your credit score itself, are dependent on you constantly feeling that you need to pay off debt and then incur new debt. A recent blog post by a Connecticut lawyer, Gene Melchionne, who specializes in consumer and bankruptcy law claims there are two things your credit score tells you: “how you handle the debt you already have and how will you likely handle any new debt.”

Think it over. Would you really care about your credit score if you didn’t need to borrow money? If you could become debt free, and get off of that debt hamster wheel, you would no longer be a slave to your credit score! Even so, some clients are still worried about what filing bankruptcy will do to their credit score. As their bankruptcy lawyer, I simply tell them about experiences of past clients. Many, within months of receiving their bankruptcy Discharge, have financed the purchase of car. What is more surprising to those not familiar with the bankruptcy process, is that many of my clients received credit card offers in the mail on the same day their bankruptcy Discharge came.

Someone’s credit score will generally boomerang a couple of years after they receive a bankruptcy Discharge, in most cases.

Many people have been a slave to some computer generated credit score number for years and have lost sight of really important financial matters like “Am I doing enough to provide for a comfortable retirement?”

In retirement, an A++ credit score won’t do much to supplement your social security check each month.

Want to find out more about credit scores and bankruptcy? Then visit K. Hunter Goff’s site on how to choose the best bankruptcy lawyer for your needs.


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Finding A Low Cost And Honest Los Angeles Bankruptcy Attorney

September 2nd, 2010

In times of financial hardship, bankruptcy lawyers are unfortunately required more often. Many times, a lawyer you can trust and is low cost is nearly impossible to find. Never fear. Here are some simple steps you can take when finding a Los Angeles Bankruptcy Attorney you can trust and afford.

When searching out a lawyer, a recommendation from someone you trust is the ideal way to start. Your family members, friends, and maybe even co-workers should be able to help in this process. The lawyer for you may be stuck somewhere in your web of connections. And even if that lawyer cannot help you, they should be able to recommend another lawyer. Do not be afraid to ask those who may be a little further away from your closest relationships. A local social worker, banker, or even your minister might know someone who can help you.

Lawyers will advertise in phone books, newspapers, and online. These are good resources when finding a lawyer. Since there are laws which govern advertising, this information may be valuable. But be careful, advertisements are designed to for one reason, to bring business.

A recommendation might be hard to get. Another option could be a lawyer referral service. Make sure the service you use has been certified. These services should give you information about bankruptcy attorneys. Certified services follow certain rules created for your protection. These certified services can also assist you with reasonably priced or free advice. In addition, a certified service may be able to locate attorneys who speak other languages than English.

There is a program offered by the State Bar for lawyers who would like to be certified as specialists. Becoming a specialist requires the lawyer to show they have much experience in a specific area like bankruptcy. But, many lawyers have experience and expertise but may not have chosen to be certified.

State bars are unable to refer specific attorneys or give legal advice. As mentioned, one of the many certified lawyer referral services is the next place to look if a consultation or hiring of an attorney is necessary. These services can tell you if your legal troubles could be resolved outside of a court, and may not require a lawyer.

Records concerning your attorney are available to the public. Check the official bar membership available from the California State Bar. This record will show when the attorney was admitted to the California Bar, which university they attended for their undergraduate degree, and which law school they attended. Most importantly, this report will tell you if the attorney is allowed to currently practice and whether there has been any history of discipline.

Based on your financial circumstances, and the area where you require legal help, you may be able to access free legal aid. Look online at the California State Bar website for standard legal resources as well as a comprehensive database of attorneys. A few law schools also give legal clinics where you could get some free legal advice.

Hopefully, by following these steps you will be successful in your search for a Los Angeles Bankruptcy Attorney. Keep your attorney well informed. Make sure you have all the details, especially concerning fees, in writing. There is no need for your lawyer to become a best friend, but keep close, and they will be a guide through this process.

Los Angeles Bankruptcy Attorneys are reliable and affordable . Check out our super guide to Los Angeles Bankruptcy Lawyers for this inside info on top class legal eagles.


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What Happens If I Stop Paying Credit Card Debt?

September 1st, 2010

As an Orlando bankruptcy lawyer, one of the first things I advise my clients to do when they decide they are filing bankruptcy and hire me is to stop paying on their credit cards. Recently, though, before I could offer that advice, a client asked me: “What happens when I stop paying my credit cards?”

The answer? Your credit card company will begin the collection process, which normally proceeds in this manner:

1. You will receive frequent phone calls from the original creditor, as will your family and your employer, attempting to convince you to make a payment over the phone. The collection agent will try to intimidate you, by saying they will ruin your financial life unless you pay up.

2. In about 90 days, your original creditor will give up and sell your account to a debt collector. This third party agency will then repeat the actions above.

3. Then, around 180 days from the time you stop making payments, you may hear from an attorney. This attorney will simply try to collect on the debt, following the same protocol in 1 and 2 above.

4. At this point, the attorney might file a lawsuit, seeking a judgment against you. A judgment would permit the creditor to collect from you through a wage garnishment. Your wages cannot be garnished without a judgment.

Kind of a long process until a judgment is obtained, right? Over 6 months from the time payments stopped being made if I added correctly. So why, as a bankruptcy lawyer, do I advise my clients to stop paying on credit cards when they hire me?

You see, the objective is for my client’s bankruptcy to be filed well prior to a judgment being entered against them. As long as no judgment is entered, garnishment is not possible. Now, my client can catch up on car or house payments, for those secured debts they intend to keep through filing bankruptcy. They are not wasting that money on payments to malicious debt collectors, for credit card debts that will be discharged in their bankruptcy. They can also use the money they have saved to create that safety net, which I advocate as their Orlando bankruptcy lawyer, to be used as part of an overall, start fresh, strategy when filing for bankruptcy.

But what about those malicious debt collection agents? Here in Florida, we have some of the toughest laws in the country to protect consumers from the abuses collectors use regularly when attempting to get my clients to pay their credit card debts. Additionally, a Federal Law also restricts those abusive acts by third party collection agents in an attempt to collect on a debt. Why not sue your creditors to enforce your rights?

The debt collection process can be an intimidating experience, or an empowering one. If you know how it works and you know your rights, the empty threats the debt collectors hurl at you in a typical phone call from them will seem laughable, and more often than not, actionable.

Get the Free eCourse to find out how an experienced bankruptcy lawyer to assist you in successfully navigating the debt collection process and help you achieve that fresh start you’ve been craving.


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All About How Your Bankruptcy Works If You Are Married

August 30th, 2010

When you are looking into Bankruptcy, you might wonder if you can file for this when you are married. You can do this. You can file when you are married. However, there are things that you must do a bit differently when file when you are married. Let us take a look at how your bankruptcy works if you are married.

One question that some people will have is what happens if they come after me for loans? What if I only file and my spouse does not. Are they held responsible? We can answer that for you. The only way they are held responsible is if their name is on the loan as well. Otherwise, it is your situation and they will come after you.

Anything you own jointly is something that can be used to pay off debts. If you file taxes jointly, that can be used as well. So, you need to be careful and you need to explain this as you are going through the bankruptcy process. Your spouse needs to understand this and it is helpful to have a lawyer.

When you file for bankruptcy, you will find that your credit is in jeopardy. It will report that you owe and that you have debt. This is standard. However, you might also worry about your spouse as they do not have debt. What happens to their credit report?

We have learned that if it is your loan alone, then that will not reflect on your spouses credit report. The reason for this is because it is in your name alone. Only those joint things will be held on their credit report as being one of those things that they owe on. That is how that works when it comes to the credit reports and how theirs will be affected.

From here things get fuzzy as you have to figure what sort of bankruptcy you want to file and so forth. You have two options as to which you can file. There is chapter seven and then chapter thirteen. Each one differs in its own way. This might be a decision you both discuss and with a lawyer as well.

When you file, you have to remember that not all states are the same. What might be for one state might be totally different for another state. With that in mind, you then need to go about and be sure that you know how your state works. There might be more filing that you need to do and so forth.

For those of you wanting to know how this worked, this answers some of the tougher questions that you might have at first. However, this does not answer everything for you. Keeping that in mind, you must then work to ensure that you do get all your questions answered as this only skims the surface as to how this process works. It is a hard process to understand and many never think that they are going to have to do that; so, you will find that there are many lawyers who are happy to help you and find which route is best for you in all.

Bankruptcy is an extremely complex process,if you need help through the process, hire a Toronto bankruptcy trustee


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