September 18, 2018

How Much Money Does it Cost to File for Bankruptcy Protection?

Yes, it costs money to file for bankruptcy protection. This post covers court costs and legal fees related to Chapter 7, Chapter 13 and Chapter 11 bankruptcy cases. Too often, I counsel folks who qualify for bankruptcy protection who’ve been spending their money trying to avoid filing. They spend it on so-called debt relief programs; they spend it trying to keep their home out of foreclosure, … [Read more...]

Chapter 13 Bankruptcy for Second Mortgages

Homeowners who are in financial difficulty are well advised to consider a Chapter 13 bankruptcy case as an option when they are current on their first mortgage but are not paying, in full and on time each month, their second mortgage (including a home equity loan or other debt secured by the property). I see situations where people whose incomes have been cut will forego paying the second … [Read more...]

Should I Keep Some of My Debts Out of Bankruptcy?

When people consider filing for bankruptcy protection, they often want to know if they can keep some of their debts out of their bankruptcy estate. In legal terms, this is called "reaffirming a debt." Reaffirmation means that the reaffirmed debt is not discharged in bankruptcy.  In other words, the Debtor voluntarily agrees that the debt will not go away.  Beware reaffirming debts What … [Read more...]

Life After Bankruptcy: How to Rebuild Your Financial Life

Many people can't consider filing for bankruptcy protection until they know what happens after their debts are discharged. They frequently ask everyone (except a bankruptcy attorney) questions like these: "Will I ever qualify for credit again? "How long will it take to get a decent rate on a car loan?" "What's the fastest way to rebuild my credit? What's in the Guide to Life After … [Read more...]

Reaffirmation in Bankruptcy: What, How, When and Why

The goal in any bankruptcy case is to discharge debts. Discharge is the technical legal term that means the debts no longer exist. Literally, they are gone and can never come back. An exception to discharge can come in the form of the reaffirmation of a particular debt. Reaffirmation means that the debt is excepted from the discharge and is not affected by the bankruptcy discharge. Reaffirmation … [Read more...]

Joint Liability for Debts: An FAQ

I am frequently asked whether spouses have joint liability for debts. This FAQ should help readers gain a basic understanding of the issues to consider, but is not a replacement for a qualified bankruptcy attorney's opinion on your specifics. Q: MY HUSBAND HAS SUBSTANTIAL DEBT THAT HE CANNOT PAY. HE NEEDS TO FILE BANKRUPTCY. DO I HAVE TO FILE WITH HIM? A: I have heard this quite often. One … [Read more...]

Chapter 11 Bankruptcy and Religious Institutions

Chapter 11 bankruptcy may offer a long term solution to the problems churches now face in the wake of The Great Recession. While the recession has been painful for millions of individuals and hundreds of thousands businesses, it has also made continued existence a matter of concern for a number of churches and other religious institutions. Unfortunately, the leadership of many religious … [Read more...]

Attorneys Who Don’t Understand Bankruptcy’s Means Test: A Case Study

I was recently consulted by a highly-paid professional.  He was quite distraught over his financial plight that included debts of over $1,000,000.  He had consulted another attorney who had indicated to him that he was going to have difficulty filing a Chapter 7 bankruptcy case because of the amount of his income. He was at his wits end. I analyzed his situation. Two ways the Bankruptcy Code … [Read more...]

The Means Test Often Decides Whether You File Chapter 7 or Chapter 13 Bankruptcy

In 2005 the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) was signed into law, and continues to be the law applicable to bankruptcies filed on or after October 17, 2005.   BAPCPA was the result of the credit card industry’s lobbying efforts, and reflects the industry’s goal of forcing more debtors to repay something to creditors by disqualifying them from a Chapter 7 with a … [Read more...]

The Bankruptcy Means Test: Don’t Make Assumptions

Virtually everyone who is considering bankruptcy goes online to get information regarding the bankruptcy process.  These folks will almost certainly encounter the “means test." This is a part of the bankruptcy law that makes it harder to file a Chapter 7, liquidating bankruptcy. The means test purportedly exists to stop people from abusing the bankruptcy law by filing Chapter 7 cases when they … [Read more...]