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Written by: leonora | Published on: January 20th, 2010
This is why you should care and why you want (if possible) to have your debts qualified as primarily non-consumer in Chapter 7: You can avoid having to qualify under the Means Test. This is especially important for debtors whose income exceeds state median income for the size of their household. If your debts are primarily non-consumer, Trustee, Creditors or US Trustee will not be able to request (successfully) dismissal for abuse under 11 U.S.C §707(b). 11 U.S.C §101(8) – defines “consumer debt” to mean “debt incurred by an individual primarily for personal, family or household purpose.” Simple enough? [...]
Written by: leonora | Published on: January 18th, 2010
1. Bankruptcy petition – the bankruptcy documents, approximately 50+ pages, your attorney or you prepare and file with the court. These documents will list your assets, debts, income, expenses and financial history. You will have to sign these documents before they can be filed. 2. Creditor’s meeting (aka 341(a) examination) – this is the initial (and in Chapter 7 only) meeting you will attend regarding your bankruptcy filing. At this meeting the Trustee will check your driver license and social security, review your documents, swear you in and ask you questions and determine if there are any assets that the trustee [...]
Written by: leonora | Published on: November 5th, 2009
Chapter 13 is this magic bankruptcy chapter that allows you to “strip” the second mortgage if it is fully unsecured and to cram down the mortgage on your second home. It is great, by the time you get out and successfully complete the plan in 3-5 years, you can get rid of a LOT of debt. There is one little catch. You can only do it if you meet the debt limitations. In California that may be harder to do than you think. Under section 109(e) of the bankruptcy code, to be eligible for Chapter 13, debtor may not have [...]
Written by: leonora | Published on: October 6th, 2009
If the debtor’s income is below the state median, the dreaded Means Test is “done.” However, if debtor’s gross income exceeds the median (gross income for the household size chosen is greater than the state median), the rest of the Means Test Form must be completed. Debtor can deduct things like mandatory deductions from gross income, income taxes and union dues. Debtor can also deduct secured payments to be made in the next 60 months. In other words, if debtor financed a car and there are 45 payments left. The 45 payments are added and divided by 60. The figure is then [...]
Written by: leonora | Published on: August 25th, 2009
Today Washington Post had a story on the effects of foreclosures on mental health. To read the full article click: http://www.washingtonpost.com/wp-dyn/content/article/2009/08/24/AR2009082402333.html Unfortunately, this is a story too familiar to a bankruptcy attorney who has been practicing for more than a week. In fact, the very first client I met (while working at another firm) committed suicide. He had a complicated case. His problems were compounded by the fact that by the time he dealt with his finances he has “borrowed” a large sum from an aging parent. I don’t presume to understand what he was going through. I met the [...]
