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Does The Bankruptcy Attorney Have To Include All My Debts?

January 11, 2012 By Bankruptcy Leave a Comment

Most people that are filing bankruptcy usually have a large number of credit cards in addition to their other debts. In many cases, the interest from credit card debt is what pushed them over the edge into the bankruptcy filing. People that are addicted to using their credit cards usually have one favorite credit card that they try to keep a lower balance so they don’t lose the ability to charge on that account. All the other ones are maxed out and they’ve come to a point where they could no longer afford to live while making the minimum payments on these credit card balances. Many times, an individual will try and set aside and not list in the bankruptcy filing that special credit card that they never used or still has available credit on it. Although, in theory it all sounds good, but when the bankruptcy attorney tells their client to list all their debts, they mean all. The last thing a bankruptcy attorney wants is to be blindsided at the meeting of creditors by the bankruptcy trustee asking why this account was not disclosed. It’s embarrassing for the bankruptcy attorney and could have ramifications on how the bankruptcy filing proceeds from there.

Many people in the process of filing bankruptcy don’t realize that most creditors continuously search the bankruptcy filings than cross reference the names with their own database. When a name pops up the check for social security number and if it matches the account will be closed anyways. So someone that thinks they can be sneaky and hang on to one credit card while discharging all their other debt is foolish. Technology has made this virtually impossible for the debtor to get away with. Once you get caught failing to disclose debts on your bankruptcy petition, the bankruptcy trustee will take a much closer look at all the schedules including an individual’s assets and the bankruptcy exemptions that protect them. The bankruptcy attorney will be on the defense digging themselves out of a hole with a bankruptcy trustee.

The court wants individuals that are filing bankruptcy to be totally honest if they plan on receiving this discharge of debt. Once that trust is broken, the court will question everything else in the bankruptcy petition. It also breaks the trust of the bankruptcy attorney with their client. First of all, if the bankruptcy attorney learns about the hidden credit card at the 341 meeting, they won’t know what else their client is hiding from them. When that trust is broken, the bankruptcy attorney might even drop them as a client.

This is important for an individual filing for bankruptcy if they want to be successful. Include all the information and let the bankruptcy attorney decide whether or not it’s important or if there is a legal way around the situation. Many times there is a solution that the client would not even know about and would avoid the embarrassment of getting caught in a lie.

The author is a professional that formed FilingBankruptcyNow.Com which provides information for debtors considering a bankruptcy filing under Chapter 7 and Chapter 13 bankruptcy and helps individuals stop foreclosure and eliminate their debt by putting them in touch with a local bankruptcy attorney.

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When Enough is Enough – Choosing to File For Bankruptcy

August 16, 2011 By Bankruptcy Leave a Comment

By Joseph Devine -

The popular culture and overwhelming desire to live up to one’s financial obligations can — as noble as that goal is — tremendously complicate an individual, family, or organization’s efforts to eliminate debts and proceed in a more fiscally responsible manner. By creating the impression that the inability to meet payment schedules constitutes some sort of personal or moral failing, these cultural barriers can cause people to strain themselves physically, emotionally, and monetarily well beyond the point of reason. Though bankruptcy is not simply an easy out and should not be looked at as an escape valve at the first sign of financial distress, there are many circumstances under which it represents the best and most sensible option.

The reality is that the majority of those who are driven to consider bankruptcy end up in dire straits due to significant changes that are beyond their own control. These tend to be dramatic shifts in one or more areas of life, including divorce, the loss or reduction of employment, or affliction with a substantial physical or mental illness. It is important that you bear this in mind as a factor in your own financial struggles so that you do not judge yourself harshly and that you can maintain an accurate perspective on the appropriateness of bankruptcy in your present condition.

Signs and Choices

Knowing when the time has come to draw the line and to take the difficult emotional step of filing for bankruptcy protection depends on maintaining an awareness about the specifics of your debt situation. This means taking a long, hard, and honest look at the terms and rates of your varied repayment agreements and realistically determining how quickly you can pay the debt off on your own. In performing such calculations, it is essential that you take into account all the necessary and reasonable incidental expenses so that you can accurately project your capacity to make payments.

Then weigh the following signs that bankruptcy may be right for you:

If you discover that your debt load is too high to pay off in a reasonable time frame
You have many dependents
Cash in accounts, including savings, is limited

A skilled and experienced bankruptcy attorney can help you to identify the best chapter under which to file for your particular debt distribution. Most likely you would file under:

Chapter 7
Chapter 11
Chapter 12
Chapter 13

For the Help You Need

If you are unsure what to do next, contact the Arizona bankruptcy lawyers of the Harmon Law Office, L.L.C.

Joseph Devine

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Filed Under: Bankruptcy Attorney, Court Tagged With: Bankruptcy Attorney, bankruptcy filing, bankruptcy lawyer, chapter 13, chapter 7, Credit Card Debt

Credit Card Debt – Eliminating It Through Chapter 7 Bankruptcy

July 26, 2011 By Bankruptcy Leave a Comment

By John Skiba -

Credit card debt is a big reason many people seek out bankruptcy. It is not uncommon for people to come visit with me who have $100,000 or more of credit card debt. After a job loss, reduction in pay, or unexpected medical expense many people turn to credit cards to compensate for increased expenses or decrease in income. The good news is that most credit card debt can be eliminated or “discharged” through the bankruptcy process.

Chapter 7 bankruptcy is great for eliminating unsecured debts. An unsecured debt is one in which there is no collateral securing the loan. The most typical forms of unsecured debt are credit cards and medical bills. In a chapter 7 bankruptcy these types of debts are discharged 100%. You will not have to pay the debt and the creditor is barred from ever trying to collect on that debt again. There are a couple of pitfalls that you need to be aware of before filing for bankruptcy as it relates to unsecured debts.

Luxury Item Purchases

First, certain card use prior to filing for bankruptcy can cause problems. If you use your credit card to purchase “luxury” items totaling more than $550 within 90 days prior to your bankruptcy filing the bankruptcy court may deem those specific charges “non-dischargeable,” meaning that they won’t go away in bankruptcy. While the bankruptcy code does not specifically define what a luxury item is, it does not include goods or services that are reasonably necessary for the support of your household.

Cash Advances

Next, if you take a cash advance on your card of more than $825 within the 70 days prior to your bankruptcy filing that debt can be deemed non-dischargeable as well. This one is more clear cut – if you took the cash advance, plan on paying it back.

One caveat to both of these exceptions is that while there is a presumption in the bankruptcy court that the purchase of luxury goods and cash advances are non-dischargeable, the creditor must make an appearance in your bankruptcy case and ask the bankruptcy court to make the determination that they will not be eliminated in your bankruptcy. So even if you have those types of charges on your card, if the credit card company does not come to the bankruptcy court and request that the debt be deemed non-dischargeable, it will still be eliminated in your bankruptcy case.

I offer a free bankruptcy consultation where we can discuss your specific case and determination what relief is most appropriate for your situation.
Arizona bankruptcy attorney John Skiba can be reached at (480) 428-4028 or via email at john@skibalaw.com.

John N. Skiba, Esq.
Skiba Law Group, PLC
http://www.skibalaw.com
(480) 420-4028

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The Basics of Chapter 13 Bankruptcy

July 7, 2011 By Bankruptcy Leave a Comment

By Joseph Devine -

Chapter 13 Bankruptcy Basics

Though much has been made in recent years about both the individual and corporate financial struggles that are being faced due to the credit crunch and other broad economic factors, the reality is that there have always been genuine challenges to fiscal security. The free availability of consumer credit and predatory mortgage lending practices have combined to create something of a perfect storm for the debt-strapped, and when you add into the mix the fact that developing a credit history is now an essential part of progressing into adulthood, the deck seems to be stacked against the unwitting consumer. In the most overwhelming circumstances, it may be appropriate to consider filing for Chapter 13 bankruptcy protection.

Even if you have been working steadily for years and manage your money responsibly, it is likely that a single accident, serious illness, or other unpredictable and substantial adverse life event can suddenly threaten to undo all that you have built. Part of this is attributable to the dramatically escalating cost of medical care in the United States, which has considerably outpaced increases in the average income of American workers over the past decade. If you are uninsured or exhaust the benefits available under your insurance policy, you can be stuck with tens of thousands of dollars or more in medical debts for even fairly minor injuries.

Elements of Chapter 13 Bankruptcy to Consider

The United States Bankruptcy Code exists to help debtors to resolve their outstanding financial obligations to creditors and service providers. There are forms of bankruptcy that are available to businesses and others that are solely accessible to individuals and families that are suffering from economic woes. Chapter 13 bankruptcies are restricted to individual filers who are employed at the time of the bankruptcy filing and who appear to have some degree of job security.

As each chapter of the Bankruptcy Code is designed to serve a different set of needs and parties, so, too is each of processes differently structured and requiring of distinctly separate qualifications. A few of the relevant details pertaining to Chapter 13 bankruptcy are:

Liquidation of assets is not a required step as it is with many Chapter 7 filings
Chapter 13 bankruptcy filings stop and prevent foreclosure actions
Debts are not erased, but rather the debtor has the opportunity to propose an extended repayment plan over a 3-5 year period
Collection efforts must cease during the bankruptcy plan

For More Information

For further information about credit management and bankruptcy protection, contact the Arizona bankruptcy lawyers of the Harmon Law Office, L.L.C.

Joseph Devine

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The New Bankruptcy Laws and Credit Card Solicitations

April 14, 2011 By Bankruptcy Leave a Comment

By Harry H Husted -

The biggest problem for debtors today is what to do with the mounting debt they have, especially credit card debt. Ever since the new bankruptcy laws have changed, credit card companies have become more aggressive than before in marketing to consumers. Why? Because they know consumers can’t file bankruptcy so easily. This creates problems for consumers, as they fall for the offers and get further into debt.

The irony of the situation is that when the members of the American Bankers Association (ABA) testified on behalf of the credit card industry urging for reform, they were questioned as to the reason so many bankruptcies were occurring. Instead of agreeing that they were part of the problem, they passed the buck, as it were, and blamed consumers because they were taking on too much debt, being irresponsible with their credit, and in some cases, were flat out being fraudulent, while the credit card companies were being careful with consumers, especially with soliciting new accounts.

What is surprising to know, and this is based on CardTrack findings, is that since the “Bankruptcy Abuse Prevention and Consumer Protection Act” was passed in 2005, credit card companies have sent out more than 8 billion account solicitations, or 1.5 billion more than they had in 2005.

If you are one of those consumers who are being targeted by credit card companies, you can avoid the trap by learning more about credit, how to use it, and how it works, along with what happens when someone files bankruptcy. Educate yourself and your children on the responsible use of credit and how to manage your debt.

Harry Husted is a full time writer, problem solver, and worked in the area of finance for about five years. He’s an expert with how to handle money. If you would like to hire Harry to write anything on finance, debt, credit, or bankruptcy, go to his website at http://www.creatingwords.com, or send him an email to husted@creatingwords.com.

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What Is an Alternative to Bankruptcy?

February 3, 2011 By Bankruptcy Leave a Comment

By Shawn Stack -

If you have already begun searching the Internet for an alternative to bankruptcy you may be dazed and confused trying to sort through the options to determine which is the best for you. To help get through the maze let’s begin by separating those alternatives to bankruptcy you’re read about that provide legal protection from those that don’t.

Alternatives with No Legal Protection

First, there are debt consolidation loans where you borrow new money to pay back old money. In almost all cases these loans are backed by the equity in your home. Some Canadians who wipe out $20,000 in credit card debt by borrowing $20,000 against their home cannot resist the temptation to continue to use those cards, resulting over time in new credit card debt plus the cost of the consolidation loan. If you fall into that trap and can’t make the payments you have no legal protection against losing your home.

Second there are the debt management plans and debt settlement plans offered by for profit companies billing themselves as debt solution companies or credit counseling agencies or debt management consultants. If you enroll in any of their plans acceptance into the plan is at the discretion of your creditors. What’s more there is nothing to stop them from refusing to honor the plan at any time in the future.

Alternatives with Legal Protection

Unfortunately, there are only two, and one of them – an Orderly Payment of Debts – is only available in the Provinces of Alberta, Saskatchewan, Prince Edward Island, and Nova Scotia. You will need to work with a not for profit counseling center to apply for one.

A legally binding alternative to bankruptcy available to all Canadians is the Consumer Proposal. To see if you qualify for this alternative you would need to work with a Licensed Bankruptcy Trustee. This option, along with an OPD, will stop any and all collection activity against you dead in its tracks. Creditors are ordered by the courts to stop any activity in progress – such as wage garnishments, bank account attachments, and property liens – as well as prohibiting them from initiating any activity or even communicating with you as long as you are successfully completing the repayment plan you are in.

As you probably already know there are variations in these plans but the issue of legal protection is one that is often overlooked in favor of the debt solution options advertised on television, which typically have no legal standing at all.

How important is it to be legally protected? To answer that question we have to examine the relationship between three critical aspects of your financial situation – how much you make, how much you owe, and how much you own.

Income, Assets, and Total Debt

If your total debt is low – many experts advise $5,000 or less – and your income is high enough to work out some consolidation of payments that will allow you to repay the total in 3 years or less, the chances are high your creditors will honor the plan without taking action.

Once you get into the stratosphere of total debt — $20,000 or more – and you have significant income and assets, you could be in trouble. Your creditors could choose to garnish your income and get liens on your assets.

The best way to get specific advice about an alternative to bankruptcy for your situation is not the Internet; rather it is a face to face meeting with either a reputable Credit Counselor in your area or a Licensed Bankruptcy Trustee, or both.

If you need advice on your Calgary bankruptcy problems, you can visit Bromwich & Smith at SolvingDebt.ca. You can also download their free ebook on 10 Things You Need to Know about solving your debt problems.

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Bankruptcy Alternatives – How To Avoid Bankruptcy With A Debt Settlement

December 2, 2010 By Bankruptcy Leave a Comment

By Samantha Cox -

Consumers often see bankruptcy as the only way out of their current financial situation. However, consumers do not like what bankruptcy feels like nor what bankruptcy does to their credit scores. With bankruptcy the consumer often looses everything including houses and cars. They often have money taken out of their paychecks. The effect on their credit score is horrible and stays for 10 years.

The consumer has three choices besides bankruptcy. The consumer can go through credit counseling, debt negotiation, and credit consolidation. This allows the consumer to feel empowered and avoid bankruptcy.

Debt counseling is for those consumers who are in the best shape. Credit consolidation is when all the credit card debt is combined together and there is one lower interest rate. The idea is that with less interest accruing on multiple cards, the payment will be smaller. All the debt will be paid back and no negative effect on the credit score will occur. The advantage to having a professional do the work is that you will end up with a lower interest rate meaning you will pay less money.

The second choice is for those consumers who are making at least the minimum payment. With debt consolidation the consumer hires a professional that helps the consumer lower their bills. They do this by combining all the debt and making one monthly payment usually with a lower interest rate. By having a professional do the negotiating the consumer wins with lower interest rates. The professional will also help the consumer plan a budget that they can live within.

In this choice, you usually have to pay only half of the money and over a period of three years. Under credit card debt settlement the consumer will be working with a company that helps negotiate the bills down where the consumer can handle the payment. Then the consumer will make one payment to that company. They will also help the consumer plan a budget that they can live with. For the consumer this option is very freeing. It also means that later when the consumer wants to buy a home or other large ticket item the consumer can get the loan. The consumer can usually settle their debt for 50 cents on the dollar.

So you can avoid bankruptcy through debt settlement. You can choose to do so today!

Debt settlement is a legitimate alternative to filing bankruptcy. Consumers can expect to eliminate around 50% of their unsecured debt with the help of a legitimate settlement program. With the new FTC laws recently passed in July 2010, debt settlement is a much less risky option. If they don’t settle your balance you don’t have to pay a dime.

Check out the following link for free help from a certified debt relief specialist:

Free Debt Advice

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Getting Out Of Credit Card Debt Fast – Bankruptcy Vs Debt Settlement

November 12, 2010 By Bankruptcy Leave a Comment

By Samantha Cox -

If you are unsure of choosing a legal way to get rid of your credit card debt quickly, this article can help you great deal. Let us talk about the two debt relief programs which have created hype in the market; bankruptcy which was a favorite program in the past and debt settlement which is getting popular, every passing day.

In every matter of life you choose a way which is legal and ethical, then why not in this case? Let’s find out which one is more ethical and legal; bankruptcy or debt settlement:

Bankruptcy is a state in which an individual or an organization legally declares its inability to recompense its debt to the creditors. It was a convenient way out of debt situation in the past as the debtor had to pay nothing; but not now, the new laws formulated and implemented by the American government, along with Federal Trade Commission, have made it harder than ever.

Financial settlement is a process in which a debtor negotiates with its creditor, through a debt settlement company in most of the cases, to reduce its pending debt and getting out of the debt situation quicker than paying the minimum monthly payment. Debt Settlement might be the most feasible option for most of the defaulters as it saves you the two most important things; time and money. Unlike bankruptcy, it does not involve all-embracing paper work or court prosecutions. This might be surprising, but true, that Debt Settlement process can reduce your debt from 50 to 70%.

The two most important things in business are time and money. Debt settlement simpler process can save the both while in bankruptcy you have to pay huge amount of fee to the bankruptcy attorneys and considerable amount of time is wasted in tiresome paperwork, never ending court proceedings and agonizing legal tests. Debt settlement has much better effects on your credit rating than bankruptcy, which means you can get more loans in the future.

If your debt is over 10,000 dollars, a settlement is undoubtedly the best way out of debt. It saves your time and money and you can live a graceful debt free life!

Check out the following link for free help from a certified debt relief specialist: Free Debt Advice

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Bankruptcy and How To Recover

October 13, 2010 By Bankruptcy Leave a Comment

By Vince Armstrong -

After having a bankruptcy, it may seem like your troubles are only continuing, not getting better.

If you originally went into debt because you have bad money management, don’t let it happen again. Get counseling and go to classes. To begin your fresh start, pay off all debt that you still owe after declaring bankruptcy.

Don’t get a loan or have a balance on a credit card that you can’t pay back in a fairly short amount of time. Just remember that you can’t spend more than your income. If you don’t have a savings account, open one. You have to be prepared for layoff and unemployment, especially in this difficult economic state.

Your bankruptcy has probably lowered your credit score by a couple hundred points and it will show up on your credit reports for up to 10 years. It may be difficult to rebuild your credit, but don’t give up. The first step is to get a secured credit card to build a good payment record, after a few months or a year, try to get an unsecured credit card. Some credit card companies actually offer cards to people with bad credit. Some credit issuers will also approve you for credit cards because you tried to fix your mistakes unlike someone who is still in debt.

Once you have some new credit cards be sure that you always pay on time every month. If you miss a payment or pay late, you are putting yourself one step further away from having good credit again.

The road to bankruptcy recovery will probably be long and sometimes frustrating, but you can get through it. Be aware that you will get denied for things and just do anything that you can to ensure that you aren’t making any of the same financial mistakes that you made before.

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Filed Under: Bankruptcy Attorney, Court Tagged With: Bankruptcy, bankruptcy recovery, credit card, Credit Card Debt, debt, unsecured credit card

When To File For Bankruptcy

October 8, 2010 By Bankruptcy Leave a Comment

By Vince Armstrong -

If you are in debt and weighing your options, bankruptcy may be going through your mind. But when should someone file for bankruptcy?

If you are over $10k in debt you can get help with a debt settlement. If you have done a debt settlement and still cannot pay off any of your debt you may have to file for bankruptcy.

If you owe millions of dollars and your business has failed, you may have to file for bankruptcy.

If your car is about to be repossessed, your house is under foreclosure, and you owe money on credit cards and loans, you should look into filing for bankruptcy.

Filing for bankruptcy is the action to take when you’ve tried everything else and still can’t pay off your debt. It is being legally declared unable to pay your creditors.

Bankruptcy can stop repossession, foreclosure, and calls from bill collectors, but you will still have debt that has to be repaid. Some debts cannot be eliminated and a court decides which percentage of your debt you will have to pay.

You may get a fresh start, but you won’t be completely free from your mistakes. You will owe money and it will be difficult to repair the damage done to your credit. It is possible to eventually have good credit, but it may take years and years.

Always try credit counseling, debt settlement, or debt consolidation before filing for bankruptcy. Debt settlement can reduce the amount you owe just as bankruptcy can, but it doesn’t hurt your credit score.

With the state of the economy, many people are in debt. Getting out of debt is a long struggle, but it can be accomplished. If bankruptcy is the only option you have left, make sure you find a good lawyer to help you through the process.