Tag Archive for: chapter 7

Should you Reaffirm a Mortgage In Bankruptcy?

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My answer is NO.

Reaffirming a debt means that if you don’t make your future payments the mortgage company can sue you for the balance due after your Chapter 7 is over.   The debt is not discharged if you reaffirmed the debt.

Debtors are required to reaffirm their car loans in bankruptcy in order to keep their vehicles, even if they are current on the vehicle.  Mortgages are a different story however, you can just continue to pay the mortgage and keep the house, without reaffirming the debt.  The mortgage company will not report your mortgage payments, on time or late to the credit bureaus.

If the debtor stops paying the mortgage and has not reaffirmed the debt, the most the mortgage company can do is to take the house back in foreclosure.  The mortgage company will not be able to obtain a personal judgment against you if you have a bankruptcy discharge and did not reaffirm the debt.

This means if later you decided you do not want to keep the home any longer, you can strategically default on your mortgage and just walk away.  This is very valuable.

Why would you consider reaffirming a mortgage then?

If the mortgage company agrees to modify one or more of the mortgage terms so the mortgage is more beneficial to the Debtors you could consider reaffirming.   Possible modifications terms could be a lower interest rate, a lower monthly payment, placing arrears on the back end of the mortgage, or deeming a default current on your credit report.

Reaffirming a mortgage debt requires a complex multi-page agreement which must be approved by the Court.  Unless the Debtor is receiving a  benefit from the mortgage company, most attorneys will not sign off on the agreement and it will require a court hearing.

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney

Difference Between a Chapter 7 and a Chapter 13

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Difference Between a Chapter 7 and a Chapter 13 Bankruptcy

Chapter 7 is a liquidation bankruptcy, it has two primary functions: reviewing your assets to see if you have non-exempt assets that can be turned into cash the trustee can liquidate to pay back some of your debts, while attempting to eliminate your remaining debts. Creditors will receive notice of the automatic stay upon your filing, which means they must stop contacting you about unpaid bills and seize any legal actions.   Unsecured debts, like medical bills and credit card balances, can usually be wiped out in Chapter 7 bankruptcy.  You must pass a means test in order to qualify for this bankruptcy.

Chapter 13 is a reorganization bankruptcy,  your attorney creates a detailed plan for you to pay back creditors while prioritizing your debts and forcing lower payoff amounts.  Unsecured debts like credit cards and medical bill receive cents on the dollar and they the balances are discharged. In Chapter 13, you will pay only disposable income, or the amount above your living expenses, toward unsecured debts for a period of three to five years. It also gives you a chance to catch up on secured debts like mortgages or car loans and work on regaining your good standing with creditors. You must have regular income to qualify.

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate

April-July Special- Chapter 7 at $795

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Clearwater Bankruptcy Attoreny

Chapter 7- $795 excludes filing fee includes personal property appraisal and credit report.

Chapter 13 -$1,500 down balance through plan capped at $4,500 plus administrative fees excludes filing fee, includes personal property appraisal and credit report, does not include loan modification ( additional $1800 through plan).

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate

Failure to Disclose Claim in Bankruptcy Petition

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Lewis v. Portfolio Recovery Associates, LLC 

The Debtor filed a Chapter 7 Bankruptcy in NJ.  The Debtor did not disclose his FDCPA action and received a discharge.

The debtor  then filed a lawsuit alleging the defendant sent him a letter in an attempt to collect a debt that contained a “mini-Miranda” warning in a box entitled “Account Details.” According to the debtor, by mislabeling his legal rights as “Account Details,” the defendant’s correspondence was misleading and designed to confuse the debtor as to the nature of the debt and his rights.

Portfolio Recovery Associates argued that the debtor lacked standing to sue because he failed to schedule the lawsuit as a personal asset. 

 Section 541(a)(1) of title 11 of the U.S. Code provides that a bankruptcy estate comprises “all legal or equitable interests of the debtor in property as of the commencement of the case.” In re Allen, 768 F.3d 274, 281 (3d Cir. 2014). The scope of Section 541(a)(1) is broad, and includes possible legal causes action. Id. It imposes upon a debtor an ongoing affirmative obligation to disclose all assets and liabilities to the bankruptcy court before discharge, including pending and contingent claims. A failure to list an asset as property of the bankruptcy estate does not prevent it from becoming property of the estate.

With regards to undisclosed claims see  Schafer v. Decision One Mortg. Corp., 2009 U.S. Dist. LEXIS 56639, *12 (E.D. Pa. July 1, 2009). In order for a debtor to obtain standing, the trustee must abandon the unscheduled claim, whether voluntarily or pursuant to a court order. 11 U.S.C. § 554(a)-(b).

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate

Qualifying For A Chapter 7

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  • Your Income Barely Covers Your Bills
  • You Can Pass The Bankruptcy “Means Test” Or You Have Exceptional Circumstances
  • You Don’t Have Enough Assets To Pay Off Your Debts
  • Your Debts are Non-Consumer
  • You are a Business Liquidating

 

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate

How Can Chapter 7 Help You?

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Chapter 7 Can Wipe Out:

  • Credit Card Debts
  • Hospital Bills
  • Most Lawsuit Judgments
  • Wage Garnishments
  • Payday Loans
  • Utility Bills
  • Foreclosure Deficiency Balances
  • Vehicle Repossession Deficiency Balance

Carol A. Lawson, Esq., 28870 U.S. Hwy19 #300, Hodusa Towers, Clearwater, FL 33761             Phone: (727) 410-2705;   email: calh@gate.net

Chapter 7 Now $795.00

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Clearwater Bankruptcy Attoreny

Chapter 7 now $795 includes personal property appraisal and credit report if you mention this post.   A savings of $228.

 

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate

Filing For Bankruptcy Can Stop Wage Garnishment

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Mounting Debts can result in Wage Garnishment. What is Wage Garnishment and how does it happen you ask.   The steps to wage garnishment are as follows:

The Creditor seeks legal help to collect your debt.  The Creditor obtains a Judgment against you. The Creditor does discovery for your employer and bank accounts. The Creditor obtains a Court order that requires the debtor’s employer to withhold part of the wages and pay it to the creditor. The Creditor can obtain 25% of Debtor’s disposable income.

Filing for Bankruptcy can stop 0 this kind of wage garnishment. Filing for Chapter 7 or Chapter 13 invokes an automatic stay that stops all collection activities by creditors, including wage garnishments. Resumption of any collection activities requires permission from the bankruptcy court.  After your Chapter 7 discharge, the creditor can no longer collect the debt, or garnish your wages. In a Chapter 13 Bankruptcy,  the automatic stay will last the full 3-5 years till your discharge is entered.   A portion of the debt will be paid along with other unsecured creditors, the balance will be discharged.

Contact our office today at (727)410-2705 to schedule your free consultation.  Regardless of the laws that are applicable to all, each situation is unique.  We will offer you the best advice on the specific course of action to take depending on your unique situation.  We will then guide you through the process.

 

 

Carol A. Lawson, Esq., 28870 U.S. Hwy 19 #300, Hodusa Towers, Clearwater, FL 33761

Phone: (727) 410-2705;   email: calh@gate.net

 Clearwater Bankruptcy Attorney, Clearwater Bankruptcy Lawyer, Clearwater Bankruptcy, Clearwater Estate Planning Attorney,  Pinellas Estate Planning Attorney, Pinellas Probate Attorney #FileLocallyDontOverpay #ClearwaterBankruptcy #ClearwaterBankruptcyAttorney #ClearwaterEstatePlanning #ClearwaterProbate