What if you have to file bankruptcy again?

If you find yourself in a situation again where a bankruptcy filing is the only route to fix the financial problem, yes you can file again. Bankruptcy can be filed any number of times, but the biggest hurdle you will face is whether you will get a discharge. A Chapter 7 case cannot be filed again until 8 years have passed since the first case was filed. However, if need, a debtor can file a Chapter 13 case should he have some secured debt that needs to be taken care of. It is possible … [Read more...]

Bankruptcy – Punishment or Reward?

Bankruptcy is neither a punishment nor a reward. It is a method to smooth out a period of financial instability. Some may argue that a person who gets a discharge from his debts is getting rewarded for bad financial management, specifically a over use of credit cards. True, but it would most likely be applicable to maybe less than 1/3 of all filings. Although overextended credit may include over-use or abusive use of credit cards, it would also include purchases of homes and cars that are … [Read more...]

What happens when I have a foreign debt I can no longer pay?

Occasionally, I will see a question come up on the internet regarding foreign debts and whether those types of debt are dischargeable in a bankruptcy that is filed in the United States. The simple answer is yes the debt is dischargeable in a United States bankruptcy case. The basic issue regarding discharged debts, even foreign ones, is enforcement. All debts that have been discharged in a bankruptcy case filed in the United States are protected from future collection by a creditor through … [Read more...]

Is there a stigma to bankruptcy?

Many many years ago, people stigmatized those who did not pay their debts and turned to bankruptcy to solve their financial problems. This stigmatization caused people to be afraid to seek help through bankruptcy because they did not want to be labeled “deadbeats.” They also believed that filing for bankruptcy would affect their ability to seek employment because they would have been regarded as financially irresponsible. The idea that someone would file bankruptcy was just not heard of. It … [Read more...]

The Chapter 7 341 Meeting of Creditors

Carol called me the other day to ask what she should expect at the 341 Meeting of Creditors. She was somewhat nervous about the hearing. It is not unusual that I get a call from my clients after they get the notice of the hearing. Carol also asked if there would be a judge there and I said no, the hearing is conducted by a Chapter 7 Trustee whose job it is to review cases to see if there are any assets that can be sold to pay creditors. She also asked if any or all of her creditors would be … [Read more...]

What happens when I can no longer afford my Chapter 13 case?

The national success rate for Chapter 13 cases is approximately 33%. It has also been reported that if a bankruptcy is filed, Chapter 13 is the better way as it helps all parties. The debtors are at least paying something on their debt. Creditors are happy to get at least some of the money owed to them. And in the grand scheme of things, commerce continues to work. However, many times, those debtors who go the route of Chapter 13 experience a change in circumstance that was not expected. … [Read more...]

How is an overpayment of Unemployment Compensation handled in bankruptcy – is it dischargeable?

Over the past few years, a lot of people have been losing their jobs and in order to make ends meet, they have filed for unemployment compensation benefits. In an effort to get back to a financial normalcy, they collect their benefits each week and look for that illusive job. They make things work as best they can, but then nothing happens and the bills continue to pile up. On top of those bills piling up, a letter comes from the Department of Labor explaining that the state made a mistake … [Read more...]

What happens to my credit report?

Did you know that filing a bankruptcy case does affect one’s credit report in a negative way?  Many debtors are under the belief that by filing bankruptcy, they will never ever be able to buy a house, car or anything else because they filed bankruptcy.  While filing bankruptcy is not going to produce a positive spin on a debtor’s credit history, nothing can be further from the truth.  Clients have shared with me the fact that they have taken a 200 point hit while others only 100 points.  … [Read more...]

INCOMES, DEBTS AND BANKRUPTCY

Sometimes I will get a phone call asking how much debt someone must have in order to file a bankruptcy.  Another question that comes up is regarding income levels, as in ‘can I file if I have too much or too little income?’ First, income levels as well as debt levels do not determine whether you can file, but will determine which type of bankruptcy you can file.  Yes, it is possible that you may earn too much income to file a Chapter 7 bankruptcy, but a Chapter 13 can be filed for those wage … [Read more...]

Can Bankruptcy Really help?

Many times, debtors aren’t sure whether filing bankruptcy will really help their situation or hurt them. The word bankruptcy has a tinge of negativity to it. History shows that the word comes from the Latin terms bancus (a bench or table), and ruptus (broken). Additionally, Italians have been known to use the word “bancarupta”which means bench broken or bank broken quite often when a banker/tradesman could not make good on his debts. So it is understandable when people try to find other ways to … [Read more...]