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Recovering From Financial Ruins After an Injury

6 Types Of Debt You Can’t Discharge With A Chapter 7 Bankruptcy

Posted by on Oct 22, 2015 in Uncategorized | Comments Off on 6 Types Of Debt You Can’t Discharge With A Chapter 7 Bankruptcy

Filing for bankruptcy allows you to discharge a wide range of debts, freeing you from the stress of owing money to a dozen different creditors. However, not every debt automatically becomes wiped away when you successfully pass the tests for filing the Chapter 7 style of bankruptcy. Learn about these six debts that are usually excluded in this type of filing so you can figure out if another type of bankruptcy might work better for you. Unlisted Obligations The court can’t make any decisions and issue declarations for debts that go without listing on the filing paperwork. It’s possible to address a debt you miss later by hiring your lawyer to reopen the case and have a declaration sent to the forgotten creditor, but it’s costly and difficult. Make sure you record every debt you have, and who you owe the money to, before starting the Chapter 7 process. The discharging process is the only way to stop creditor calls and prevent potential lawsuits. Most Student Loans In almost all cases, student loans are exempt from any type of bankruptcy discharging. Yet, you can still manage to get some or all of your educational debt discharged in a Chapter 7 filing if you’re lucky. In order to beat the odds and include these loans in your case, you’ll need to Prove that paying back the most lenient plan offered by the creditor will still prevent you from affording your basic needs Demonstrate unemployment, costly illnesses, or other hardships that keep you from paying the loan back File an adversary proceeding, which is an additional and separate lawsuit apart from the bankruptcy. Child Support Amounts Are you receiving letters from the state requesting that you pay a large amount to your former spouse to support your shared children? Don’t expect Chapter 7 bankruptcy to fix this kind of problem. While there are ways to prove you can’t repay the money yet by appearing in family court, none of them involve any bankruptcy directly. Your lawyer can help you decide if filing first could help you argue your case to a family court judge. Crime Related Debts Most types of money owed after a crime is committed rests outside the jurisdiction of a bankruptcy court decision. For example, money you owe to a person injured by a drunk driving accident or a willful and malicious action remains your responsibility to repay. This immunity extends to cover amounts owed as government fines, payments for parole services, willful property damage, and restitution ordered by any court. Large Cash Advances Watch out how much money you start withdrawing against your credit cards or loans in the months leading up to your Chapter 7 filing. The courts go over your financial records with a fine tooth comb to find signs of planning, so you’re still on the hook for cash advances taken out within 70 days of the filing date. However, amounts totaling under $925 are included for discharging, so you can still use an advance to pay a bill or buy groceries in an emergency. Past Bankruptcy Exceptions Finally, consider your history of bankruptcy before choosing a Chapter 7 arrangement. While other forms of bankruptcy allow you to forgive debts that have survived former filing, this form limits the discharging of any money owed...

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Should You Consent To Let Your Bankruptcy Judge Hear Related Matters?

Posted by on Jun 18, 2015 in Uncategorized | Comments Off on Should You Consent To Let Your Bankruptcy Judge Hear Related Matters?

If you’ve recently fallen behind on some bills (or are tired of juggling to avoid the inevitable) and are considering filing for bankruptcy protection, you may also be struggling with other legal problems. Often, bankruptcy comes on the heels of a messy divorce or inheritance battle — and in some cases, you could find yourself engaged in several simultaneous matters in both state and federal court. However, a new ruling from the U.S. Supreme Court can allow you to grant permission to the bankruptcy court to consolidate each of your related cases and hear them along with your bankruptcy. When should you consent to this consolidation? What effects could this decision have on your case? Read on to learn more about the factors you may want to weigh when making this important decision. When may other cases be heard by a bankruptcy judge? If you’ve already stopped paying certain bills, you may have begun receiving collections notices or court summonses. These collection matters are generally filed on the state level, in your local county court. However, bankruptcy law is federal — and the courts that hear bankruptcy matters answer to the U.S. Supreme Court. Because bankruptcies and collection matters are handled by different types of courts, there’s relatively little overlap, even if the same debt is at issue in both matters. For decades, the common law permitted individuals who had other related cases pending to request that the bankruptcy judge to make findings of fact and issue rulings on these related cases, along with the bankruptcy itself. This changed in 2011, when the Supreme Court held in Stern v. Marshall that federal bankruptcy courts couldn’t constitutionally enter final judgments in state court cases, even if the matter had essentially already been litigated in the bankruptcy court. The Court clarified this controversial ruling in May 2015, holding that while their previous constitutional argument stood, parties should be permitted to consent to the court’s exercise of jurisdiction over other cases. This essentially takes the courts back to the pre-Stern v. Marshall days and allows them to streamline their workload by consolidating multiple federal and state law issues into a single case. Under what circumstances should you consent to consolidation?   In most cases, allowing the bankruptcy court to hear evidence and make findings of fact in your related matters — like garnishments, liens, inheritances, or divorce settlements — will dramatically reduce the amount of time you have to spend in various federal and state courts, as well as lower the amount you must spend in attorney’s fees. Because the bankruptcy judge has already been presented with extensive information on your financial matters in conjunction with the Chapter 7 liquidation or Chapter 13 repayment plan, you won’t need to relitigate these issues, and your attorney won’t need to spend extra time preparing for a hearing or cross-examination. However, the streamlined docket resulting from your consent for the bankruptcy court to hear your case may not always be worth the potential drawbacks. In some cases, you may already have a good relationship with the local district or trial court, and may want to keep your non-bankruptcy case(s) in this court for continuity and because you expect a good and fair result. However, even if you withhold your consent, you may not be able...

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3 Things You Should Not Do When Filing For Chapter 7 Bankruptcy

Posted by on Jun 18, 2015 in Uncategorized | Comments Off on 3 Things You Should Not Do When Filing For Chapter 7 Bankruptcy

Bankruptcy is a legal process available for people to use when they find themselves in desperate financial situations. While filing for Chapter 7 bankruptcy has consequences, it also has a lot of benefits too; however, you cannot file unless you qualify. You should also know that there are certain things you cannot and should not do before you file, and here are three of these things. Give Away Your Assets If there is one thing you should know about Chapter 7 bankruptcy, it is that you stand to lose some of your assets when you file. Qualifying for Chapter 7 allows you the right to have your debts discharged, which means they are wiped out, forgiven, and gone. The downside to this is that if you have assets of value, the bankruptcy trustee can seize them and sell them to raise money to repay some of your forgiven debts. Because of this, it might be tempting for you to “give” some of your things away before you file. For example, if you have a classic car that you do not want to surrender in the bankruptcy proceedings, it might be tempting for you to transfer the title of the car to a trusted relative for a temporary period of time. The act of doing this is strictly prohibited before or during a bankruptcy case. If you get caught doing this, the bankruptcy trustee has the right to dismiss your case, leaving you without any of the benefits of a Chapter 7 bankruptcy. In addition, if this happens, you will not be allowed to file for bankruptcy for at least 180 days from the time the dismissal takes place. File a Lawsuit While it is not against the law to file a lawsuit prior to filing for bankruptcy, it would not be advantageous for you to do this. When you file for Chapter 7, you will have to disclose all your income, debts, and assets. You will also have to disclose any inheritances you might be receiving soon, or any compensation you are expecting from lawsuits. If you are in the middle of a lawsuit when you file, the bankruptcy trustee must know about it. In other words, you must legally disclose this information when you file. This is legally required because the trustee handling the case has the right to seize the money you win from the case. This money is considered an asset and can be used to repay the debts that are included in the bankruptcy. If you want to file a lawsuit against someone, you should either wait until after you file for bankruptcy, or you should wait to file for bankruptcy for six months after the lawsuit is settled. The reason for this is due to the six month period of income you are required to report when you file for Chapter 7. If you have to include this money in your income, you might not meet the requirements for Chapter 7. Lie About Anything Finally, you should realize that if you lie about your income, assets, or debts when you file, your case could get dismissed immediately. Bankruptcy trustees are used to complete bankruptcy cases, and one of their jobs is to examine a person’s application. If they find any type of miscalculation, discrepancy,...

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Surviving And Thriving After Filing For Chapter 7 Bankruptcy

Posted by on Jun 3, 2015 in Uncategorized | Comments Off on Surviving And Thriving After Filing For Chapter 7 Bankruptcy

Chapter 7 bankruptcy has a bad reputation. Of course, it’s not a process that anyone undertakes lightly, and it’s usually reserved for those people who are seriously in deep debt, and who are already in a dark, stressful place. However, there is life after bankruptcy, and no matter how stressful things get, you will survive, In fact, some people find that filing for Chapter 7 bankruptcy is one of the best things that they could ever do for their finances. Here are some tips on how you can survive and thrive during, and after, filing for Chapter 7 bankruptcy. Be honest and complete when listing your debts. When you file for Chapter 7 bankruptcy, you must list every debt that you owe, even if you plan on paying some of those debts back. Some debts can be reaffirmed, which means you agree to keep that debt and be responsible for paying it back after your bankruptcy. For example, if you have a loan that you are repaying because you purchased a car, it may be in your best interest to reaffirm that debt, and keep making payments in order to keep the vehicle.  You won’t necessarily lose all of your “stuff” when you file. Under a Chapter 7 bankruptcy, all of your unsecured consumer debt is wiped out, and your assets can be sold to repay the debts. However, you needn’t worry about losing everything that you own. Most states allow people filing for bankruptcy the chance to keep the basic necessities, such as a car for getting to work and school, furniture in the home, and other household items.  Exemptions are in place to secure a decent standard of living for people filing for bankruptcy, and if you have property that exceeds the exemption limits, you could have to surrender the items to be sold to repay your creditors. Speak with your bankruptcy attorney if you aren’t sure whether any of your belongings fall into this category. Never try to lie or hide property in order to keep it. If you are found to be doing this, it could jeopardize your bankruptcy case, and you could be in big trouble. You may lose your bank account. If you owe money to the bank, they will likely take the money in your checking account to pay down the debt. This is common practice, and most banks will close the account once they’ve taken the money to repay the debt you owe them. Banks can use this “set-off” to reduce their losses, regardless of how this inconveniences you. If you owe money on a bank credit card or loan, go ahead and move the money out of your checking and savings accounts prior to filing for bankruptcy. Open a new account at a different bank or credit union, and consider it part of your “new start.” Your credit may not be obliterated. While it’s true that a bankruptcy remains on your credit report for up to 10 years after you file for a Chapter 7 bankruptcy, this doesn’t mean your credit is completely obliterated. It’s true that a bankruptcy has a very negative effect on your credit report, but with careful spending, cautious borrowing and a new attitude towards your personal finances, you can repair any damage done to your credit score within...

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