Meeting of Creditors and Discharge

Had a Chapter 7, 341 Meeting of Creditors with the Trustee in Newark today. The only thing missing was the client's response to a written request of the Bankruptcy Trustee. He allowed the client to mail it after the meeting (no creditors showed up as per the typical case) and he advised the client would be discharged soon.

Lenny Dykstra, filing bankruptcy, foreclosures, unemployment

126,434 Americans filed for bankruptcy in July

— the highest monthly total since landmark changes enacted five years ago — and the number could hit 1.4 million by the end of the year, Bloomberg writes.
The increases march in lock step with unemployment, home foreclosures and tighter credit. The data come from the American Bankruptcy Institute.
From January through June, 675,351 Americans filed for bankruptcy, a 36.5% jump from the same period a year ago.
Bloomberg notes a couple of celebrities who have filed for Chapter 11 protection: actor Stephen Baldwin, who is fighting foreclosure, and former Philadelphia Phillies star Lenny Dykstra, who owes between $10 million and $50 million. Dykstra's filing comes in the wake of more than 20 lawsuits he faces tied to his activities as a financial entrepreneur, including The Players Club, a glossy magazine for athletes that he helped launch last year.
Dykstra also used to be featured on Yahool Finance dispensing advise on stocks and money.

Meeting of Creditors, discharge in bankruptcy, and tax returns

When you attend your 341 Meeting of Creditors, be sure to bring with you the form of government ID (original) that has your social security number on it, along with the prior year's tax return. 45 days after the Chapter 7 meeting, you should be done with the process.

Credit Reports

Your credit report is critical to a complete submission to the Bankruptcy Court. Typically, the report contains bills that you may have overlooked, forgotten, that were not properly forwarded to you and for sundry other reasons do not show up in your own files. This applies whether you are filing a solo bankruptcy or with a spouse or significant other.

Bring your credit report with you when you confer with an attorney. It will serve you well and make for a complete Petition for Bankruptcy.

Put us between you and the problem. TM

Stop the collection calls and harassment

Can't stand the constant ring of the phone? Do you cringe when it rings? Sick of bill collectors? Bankruptcy ends all of that. In fact, if a bill collector calls you after you have declared bankruptcy, you may have a cause of action against that person for violation of the automatic stay provisions of the Bankruptcy Code. You can actually sue the harassing bill collector for calling you! Everything about bankruptcy makes it an option to consider.

Put someone between you and the problem. TM

Dischargeable divorce obligations: important chapter choice

Choice of Chapter (7 or 13) can be critical to whether a debt is dischargeable.

If the bankruptcy is a chapter 7, the obligation to the ex wife is likely non dischargable. See 11 USC 523(a)(15). If the bankruptcy is a chapter 13, the obligation to the ex wife is dischargable.

Have your counsel choose your bankruptcy chapter wisely.

Democracy, the middle class and survival

Democracy depends upon the continued existence of a large and happy middle class. In cultures without a strong middle class, democracy is threatened. A large class of poor people and a small rich class will soon part company. But, a small rich class and a large and happy middle class and a relatively small class of poor people maintainnand support a thriving democracy. During difficult financial times, middle class and upper middle class people seem to suffer most visibly.

Bankruptcy supports the existence of a large and happy middle class. It allows for a fresh start for those of us who have suffered through these difficult times. A fresh start ensures democracy and preserves the middle class. Bankruptcy is democracy in action. Like bailouts for other democratic institutions such as banks, motor vehicle manufacturers and large insurance companies, bankruptcy ensures that our democracy will survive.

Husband and Wife, joint or solo bankruptcy?

In some circumstances a husband and wife ought to declare a joint bankruptcy. In others, a solo bankruptcy may be the way to go. Today, a Wife, fully employed with both solo and joint debt, decided to declare bankruptcy. On the solo debts, she will clear her name of any liability for the debt. On the joint debts, the husband will retain his obligation to pay and will retain the property (car, etc) that may be secured by the debt. The wife is free to reaffirm the debt and maintain her obligation to pay along with her husband if she likes.

Voila.

Taxes and other Government Debts

The general rule is: all government debts must be paid. One exception is income taxes that are more than three years old. See your attorney to discuss your circumstances.

Chapter 7 vs. Chapter 13

A Chapter 7 Bankruptcy wipes out all a person's eligible debts usually within four months. In the vast majority of cases the debtor has no assets that he or she would lose. Chapter 7 bankruptcy gives a person a relatively quick "fresh start".

A Chapter 13 Bankruptcy is for people who want to pay off part of their debts over a period of three to five years.

Mirella Under Water

I have this imaginary client named Mirella that i will refer to from time to time.

Mirella lives in a house that she lost in a foreclosure. She says the mortgage was $195,000 at the time of foreclosure but the bank can prove the value was only $150,000 when the property was foreclosed. The house was "under water" because it was worth $45,000 less than the amount she borrowed. She can avoid a deficiency judgment of $45,000 by declaring a post foreclosure bankruptcy.

Bankruptcy is an option to consider.

Even as the Obama administration is pushing mortgage servicers to modify more loans to keep folks in their homes, RealtyTrac released its August, 2009 monthly report revealing more than 360,000 foreclosure filings in July - up 7 percent from June and 32 percent from a year ago. The numbers are sure to capture some attention on Capitol Hill, where Democratic leaders in both the House and Senate have threatened the return of bankruptcy reform legislation - which would empower homeowners to prevent foreclosure through the courts - if the enticements to industry don't result in more loan mods. With today's news that foreclosures have topped 12,000 per day, something must be done.

My First Blog

Some Random Initial Thoughts on my Blog:

Put Someone Between You and the Problem. (tm)

The American Medical Assoc. Journal recently reported that 62.1% of all bankruptcies have a medical cause.

http://www.pnhp.org/new_bankruptcy_study/Bankruptcy-2009.pdf

New Client came to see me, this one a "medical" bankruptcy, like so many others. He is the victim of identity theft and owns a home with three other family members. NJ's Homestead Exemption protects $20,200 in equity of each owner so... he can declare bankruptcy and still keep his home. In about a year, his credit report will start looking better too. Bankruptcy is putting people back on their feet.