Bankruptcy

Tips To Review Filing Bankruptcy Cost

2008-04-04T00:02:00.000-07:00

Filing bankruptcy cost is one of the most important aspects for a debtor who is filing a petition for the same. It includes a lot of factors and if you are not well informed and prudent in your approach, you may end up paying a much larger amount than its actual cost. Since your finances are already in a dilapidated situation, a substantial filing cost may put you into further trouble, making your overall situation worse than before. Always remember that insolvency is not an easy and quick way to get out of all your debts. It is a forced situation when all other alternatives have been tried and failed to improve your situation. Filing bankruptcy cost usually depends upon the type of bankruptcy that you have filed for, your specific circumstances, and your method of filing. In fact, there are plenty of ways to file your petition. Your chosen method plays the most important role in determining the subsequent cost.

Is It Worth Trying Using The "Do It Yourself" Manuals?

In order to save the attorney fee, some debtors prefer not to avail the services of a bankruptcy attorney. They choose to take the help of several do-it-yourself manuals that are usually available for free on the Internet. You can also find them at most of the books and stationary stores throughout the country. At the very first look, it seems like a step that can save you lots of money. However, please keep in mind that this is a serious step because the laws of bankruptcy are very complicated and unless you have thorough knowledge regarding all the aspects associated with the same, you are not recommended to ignore the role of an attorney while submitting your case in the court. Always remember that any wrong step may cause result in an increased filing bankruptcy cost. Likewise, a non-lawyer document preparation method is also not recommended for people who do not have much knowledge regarding the laws.

Getting A Lawyer

Even if the attorney charges you a substantial amount of fee, it is always worth availing their expert bankruptcy help. Here, you must note that the attorney fee and the court fee are two different elements. And, therefore, you should calculate the overall filing bankruptcy cost keeping both of them in mind. However, it is very difficult to calculate the overall cost beforehand because it varies from case to case. It is only after you have discussed your case with the lawyers that they will give you an estimate of how much is it going to cost you. Still, as per a recent research in this regard, the average attorney fee has been found to be around 2000 dollars.

Chapter 7 and chapter 13 are two most common types of individual bankruptcy. If yours is a chapter 7 case, you are supposed to pay $299 as the court fee. On the other hand, for a chapter 13 case, the current filing bankruptcy cost is $274. You have to pay the fee to the clerk of the court.

Bankruptcy Information - Some Frequently Asked Questions

2008-04-03T23:59:00.000-07:00

If you are looking out for extensive bankruptcy information, you will find the following frequently asked questions quite helpful to you.

Is It Very Difficult To File For Bankruptcy?

It is not that difficult as people assume it to be. There are some simple forms that you need to fill out. The information you have to provide may include your personal details, the list of the creditors, the amount you owe, and your current financial state – your income, expenditure etc. If you have the basic idea regarding bankruptcy laws, you will not have much difficulty in filling out these forms. However, you must note that no matter how much knowledge you have regarding these laws, if you are not a legal professional, you are always recommended to hire an attorney to handle your case. This way, you can easily make your task much easier, because in that case, you will just have to sit back and your attorney will do everything in your behalf. However, you should always remember that, no matter how easy is the process of filing bankruptcy, it never means that you should take it as an easy alternative to wipe out all your debts. After the introduction of the new laws a few years back, it has no more remained an optional thing for you. You cannot opt for the same just because you do not want to repay your debts. Such plea will easily be rejected. It is now a forced situation and must be seen as the last option. Now, it is mandatory for you to go through a Means test and a government approved credit-counseling services. The reports of the means test and credit counseling determine which kind of bankruptcy you qualify for or whether you qualify at all or not.

Does Filing For Bankruptcy Improve One’s Credit Score?

Many people have the misconception that when bankruptcy wipes out all the debts, it will eventually help improve their credit scores, which is not true. No wonder some bankruptcy lawyers are advertising their business like this in order to get some more clients, but there is no truth in it at all. It is very important for you to understand that it has severe adverse effect on your credit score. Once the court declares you as bankrupt, it brings the worst ever “negative” on your credit score. What is more, you should also note that the negative effects brought by bankruptcy are worse than any other financial component. In general, it has been found that, any negatives on your credit reports usually stay for the next seven years, but in case of bankruptcy, this period might be as long as ten years.

Therefore, bankruptcy information is very important for you, if you are considering it as a final option to wipe out all your debts. If you are well aware of all the facts, it will be much easier for you to make an informed decision regarding the same.

Bankruptcy Claim And Community Debts

2008-04-03T23:53:00.000-07:00

If you are divorced and are filing for bankruptcy claim, you might be thinking whether you will be able to wipe out your obligation of paying community debts. In normal circumstances, it is quite likely that filing the court petition regarding the same will free you from all community debts that are dischargeable. However, in some cases, you may be liable to pay the same even after you have been declared as belly-up under chapter 7 bankruptcy. Therefore, it is important for you to be aware of certain kinds of debts that may or may not be discharged. Always remember, if granted, bankruptcy is going to be there in your financial card for the next 10 years at the very least. Therefore, if you plan everything beforehand, things would definitely be much easier for you.

Filing Petition When A Dissolution Action Is Pending

However, in such cases, you are recommended to discuss the matter with your family law attorney. The attorney is an expert person and they know about the intricacies involved in the laws associated with bankruptcy claim. They will get you the real picture based on your specific circumstances and lots of other factors associated with the same. There can be several implications of filing bankruptcy during the period when a dissolution action, such as a divorce case etc, is pending. Your family law attorney will help you understand those implications and take the right step based on that. What is more, it is also important for you to note that in case the court discharges you from community debts, your spouse will become liable to pay off the entire balance on those debts. In other words, if you file your petition at a time when a dissolution action is pending and community debts are considered as dischargeable debts, the liability will be shifted on to your spouse.

Debts That Can Not Be Discharged In Any Case

Insolvency under this chapter is usually considered as freedom from all kinds of debts. However, there are certain kinds of them that cannot be discharged in any case even after you have won the bankruptcy claim under chapter 7. It depends upon the judgment of the court and your specific circumstances regarding which debts are dischargeable and which ones are not. In normal circumstances, the bankruptcy court considers the following debts as non-dischargeable.

Penalties and forfeitures,

Criminal fines,

Student loans,

Non-dischargeable debts from a prior bankruptcy,

Liability for injury or death from driving while intoxicated,

Debts caused by the malicious or willful misconduct by the debtor,

Liability associated with spousal and child support, and

Taxes (except in certain cases).

However, the debtors sometimes are not able to get even the dischargeable debts removed because the creditors have filed an appeal against the same. Still, in usual circumstances, once the debtors win the bankruptcy claim, and the equity interest in the property is exempt, they can retain the property by redemption or reaffirmation.

Filing Bankruptcy - Facts You Need To Know

2008-04-03T23:52:00.000-07:00

When it comes to filing bankruptcy, there are several facts that you need to understand. Bankruptcy is certainly not a good thing, and you should not file for the same willingly. It is a forced situation, but at the same time, it is also very important for you to understand that when all alternative doors are closed, it comes at your rescue. It gives you an opportunity to fresh start your financial life, wiping out all the previous debts that you owe to various creditors.

Will You Be Able To Get Credit Again?

People usually have the misconception that, when they are granted bankruptcy by the court, all their assets are liquidated completely and they will never be able to get credit again. However, you will be surprised to know that the fact is quite opposite. Very soon, you will start receiving credit-offers from banks and other financial organizations. The only difference is that, they will charge you a little higher interest in comparison to the usual credit-offers. Your credit ability gets affected, but it is nothing like you will never be able to get credit again. However, if you really need a credit to meet a particular purpose, such as to buy an automobile or a home, you are advised to get the credit before filing bankruptcy. This way, you will be able to get some good deals that will charge you a low interest rate. What is more, if we go deep into the technical aspects associated with this crucial financial step, you will be glad to know some interesting facts. For example, if have a credit card with zero balance, you do not need to count them as a creditor. After all, you do not owe anything to the company, which offered you that credit card. The best strategy here should be to keep that card with you so that you could use the same even after the bankruptcy court has granted your petition.

Bankruptcy For Married Couple

Many people have the misconception that, if they are married and one of the spouses gets into a debt problem, it will affect both the spouses, and both of them will have to participate mutually in filing bankruptcy. There is no truth in it at all. It is very important for you to understand that your marital status does not have anything to do with it. Whether you are married or not, if you have borrowed some debt and now are not in a position to pay off the same, the creditors will only ask you for the payment. Therefore, you can file the court petition alone. On the other hand, if both you and your spouse are liable for repayment of the debts and now you want to discharge the same because of your inability to repay, both of you are required to file for bankruptcy together.

Overall, we can see that filing bankruptcy might look like a difficult thing to do, but if you know all the facts, you can certainly make things much easier for yourself.

Bankruptcy Court - Does Getting Bankrupt Stop An Eviction Action Or A Foreclosure?

2008-03-29T02:46:00.000-07:00

Bankruptcy court is a special court that handles all types of bankruptcy cases. You can file your petition regarding such cases in this type of a court. These courts have specially been established for this very purpose. It has the final authority with regard to the judgment related to your case. The court looks into several factors and come to a decision that is not very hard for the debtor. At the same time, the creditors also get their money back. However, there are several factors that you need to know while you are planning to avail bankruptcy help. For example, you must know whether getting declared as insolvent will stop an eviction action or foreclosure. Always remember, when it comes to making the best use of your case, education is the key. You have to be well informed.

Does Getting Bankrupt Will Stop An Eviction Action?

If you are filing your petition with the intention to stop the eviction action, the bankruptcy court will consider it a fraudulent act - an abuse of chapter 7. However, if it was not your intention and your filing was genuine, there are chances that it will indeed stop the eviction action. However, it is imperative that you know that such things will only delay the inevitable. If you are the owner of the property, you are entitled to possession of your property. Till the time you get your discharge from insolvency, you can be allowed to remain in the property. On the other hand, if you are found guilty of the abuse of chapter 7, filing bankruptcy will only put you into a much deeper problem, as the court will impose other legal and monetary sanctions on you. You must know at this point that after the inclusion of the new laws, almost no loopholes are left. If you try some fraudulent act, you are quite likely to pay heavily for the same. So, you are recommended to play it safe. Be genuine.

Does Getting Bankrupt Stop A Foreclosure?

In normal circumstances, then the answer is yes. Once the bankruptcy court imposes the automatic stay, it is likely to stop a foreclosure. However, since the properties are usually secured by a deed of trust, the mortgage company retains the option to apply and the court may grant them relief from the legal stay. However, there are several factors in this regard that are taken into consideration. In usual cases, as per the new bankruptcy laws, in order to keep the home that is in foreclosure, it is mandatory for you to make a deal with the note holder.

Very few people know that filing a petition will also stop a wage attachment. What is more, it is also important for you to understand the automatic stay imposed by the bankruptcy court will also stop most of the civil judgments. This legal stay remains in place during the complete proceedings of your case.

Bankruptcy - Myths and Facts

2008-03-29T02:43:00.000-07:00

There are many myths associated with bankruptcy. It is in fact not that scary, as people have considered it to be. The credit for this popularized scariness goes to the several misconceptions that are hovering around this financial step. Let me give you a brief insight into some of those myths.

Myth 1: Filing Bankruptcy: Everyone Will Come To Know

Most people think that when they file for bankruptcy, everybody will come to know about it. Well, it is just a misconception, as until you do not tell anybody specifically about that, it is very unlikely that others will get to know that you are filing bankruptcy. The people who know about this fact include your creditors only. Obviously, you cannot hide this fact from them. However, if you are a major corporation or a prominent person, and media is giving special coverage to your case, you certainly get nothing much to do to keep the proceedings a secret. In normal scenario, despite the fact that such cases are public proceedings, does not mean that your case will be publicized. It is very important for you to understand that you are not the only person who is filing for bankruptcy. There are thousands of others as well. Therefore, it is very unlikely for every case to get the attention of public. No media has enough time, money, work force, or even interest to cover all of these cases. Even publications do not have much space.

Myth 2: Filing under chapter 7 means all debts will be wiped out

Another popular misconception is that, filing under chapter 7 bankruptcy helps you wipe out all kinds of debts completely. The laws pertaining to the same do not allow discharging or erasing some specific types of debts. These specific types of debts may include debts incurred as the result of fraud, government-guaranteed or government-issued student loans, debt related to alimony, debts related to child support etc. What is more, if some legal settlements are also under process, such amounts are also not dischargeable. It means, if in some earlier legal cases, you have been order to pay a specific amount of sum to the person who had sued you, you will be liable to pay the same even after you have been discharged bankruptcy.

Myth 3: All Your Assets Will Be Sold Off If You File Under Chapter 7

Likewise, people also have the misconception that if they file under chapter 7 and are granted bankruptcy, all their assets and properties will be sold off completely. In fact, many people who need to file under this chapter do not do so because of this fear that they will lose everything. However, you will be glad to know that you will not lose everything even if you file under chapter 7. The laws pertaining to the same also provides a provision of exemptions to certain kinds of properties, which may include clothing, household goods, and money in qualified retirement plans, vehicles, residential properties, and much more.

Overall, there are many myths associated with bankruptcy.

Bankruptcy Laws - Some Misconceptions

2008-03-25T03:01:00.001-07:00

The bankruptcy laws are quite complicated and that has led to several misinterpretations among people. Especially, after the introduction of the new laws, these laws have become more complex than they were previously. Since the new laws are in the favor of creditors, several debtors have taken these in the wrong spirit. If you are planning to file a court petition under chapter 7 or chapter 13 bankruptcy, it is very important for you to comprehend the basic understanding of the laws so that you can make an informed decision. The attorney will certainly be a great help to you, but the more informed you are, the better are your chances of getting the judgment in your favor. Misconceptions regarding the laws will only make things much more difficult for you. Let us go exploring some of the misconceptions and the reality behind them.

Misconception 1 - After Being Declared As Bankrupt By The Court, The Debtor Will Lose His Or Her Job

The most common misunderstanding about insolvency is that once a person is hence declared, he or she is socially rejected. This is not true at all. Bankruptcy laws prohibit such discrimination. There can be genuine reasons for a person filing for such an unfortunate thing. It should not in any way mean that they are not to be provided with another chance to get their financial life back on track. It is very important for you to understand that the bankruptcy code has been designed to achieve two objectives – protect the debtors and help the creditors get their money back. Therefore, if your employer is firing you just because you have been declared as bankrupt, they are acting against the law. You can file a case against them and fight for your rights.

Misconception 2 - Filing A Petition For Insolvency Means That You Will Be Sent To Jail

Many people think that as per the bankruptcy laws, a person must be sent to jail if he files for it. It is also not true at all, a sheer misapprehension. It is only because of the unawareness of people that they think about such drastic things. It is very important for you to understand that filing bankruptcy will not put you in jail. However, if you are caught in some fraudulent act regarding your case, you might be sent to jail as per the criminal act. But, if your case is genuine and your purpose of filing your petition is just to get protection from the court so that you could get another chance to get your financial life back on track, you will not be sent to jail. Always remember, there are no debtors prisons in the United States.

There are several other misconceptions as well. Therefore, if you want to make the best use of the bankruptcy laws, it is very important for you to be well informed.

Bankruptcy Information - Frequently Asked Questions

2008-03-25T02:56:00.000-07:00

When it comes to bankruptcy information, it is imperative that you understand that the more informed you are, the more accurate would be the made decisions. Following are some of the most frequently asked questions in this regard.

How Does Bankruptcy Affect The Obligations Of A Co-Signer?

As per bankruptcy information, if you are a co-signer, you will not be liable to pay the debts that are dischargeable. However, do understand that you will be held primarily responsible for the debts that are non-dischargeable. What is more, if you are filing bankruptcy with a co-signer, do not forget to list the co-signer as a creditor in your schedule. You should always remember that they have a contingent claim against you. As a co-signer, you will be liable to pay all the non-dischargeable debts, such as student loans, certain taxes etc.

Does Bankruptcy Allow The Debtor To Keep His Or Her House?

The bankruptcy information regarding homestead exemptions varies from state to state. Every state has different laws. However, each state allows exemptions of homestead properties up to a certain amount. Since laws also give you some liberty to choose your exemption scheme, the maximum amount exemptible under this section depends upon your selection of scheme and of course your specific circumstances. Overall, you may exempt a maximum of $100,000 in equity. In order to make the best use of bankruptcy exemptions in this regard, you are advised to calculate the equity of your house using a value that must be based upon the forced liquidation against the best selling conditions to arrive at your house’s real value. Now that you know the value, try deducting the total amount that you owe plus selling and transfer costs from this value. This is the right method using which you will be able to calculate the equity of your home. When it comes to bankruptcy information, you must know that the value of liquidated properties is usually very low in a depressed market. Since every state has defined the homestead exemptions in different ways, you are also advised to hire a bankruptcy lawyer. A lawyer is an expert individual who will help you make the best use of the various options available to you. They will do their best to help you keep your home even after the court has declared you as bankrupt.

Can The Debtor Keep The Credit Cards After Being Declared As Bankrupt?

There are certain circumstances in which the bankruptcy court may allow you to keep the credit cards. The court takes several factors into consideration before giving a judgment in this regard. Some of these factors include your ability to pay the present and future credit card debt, the overall balance of the credit cards at the time of filing your petition etc. As per bankruptcy information, the court also tries to know what the credit card company is willing to do.

Filing Bankruptcy - Understanding Non-Dischargeable Debts

2008-03-25T02:46:00.000-07:00

Many people have the misconception that filing bankruptcy will erase all their liabilities. There would be no obligation to pay the amounts that they owe to their various creditors. However, this not true at all. There are certain kinds of loans that have been considered as non-dischargeable ones. Filing under chapter 7 bankruptcy norms will eliminate all kinds of debts but you would still owe the non-dischargeable ones. Depending upon your specific case and the judgment of court, there can be a wide range of such debts.
Following are some of the most common ones.

Student Loans

No matter for whatever reason is that you have been forced towards filing bankruptcy, educational based debts such as student loans cannot be exempted. These may include loans for board, room, books, tuition etc. Even if the court grants your petition and orders for the liquidation of all your assets, you will still be liable to pay these loans off. However, there is a rare exception, as per which if you are able to prove the bankruptcy court that the loans will cause undue hardship for you, they may be discharged as well. For example, you may have to show some permanent disability that prevents you from getting a job and living a normal financial life. If you are capable of proving such aspects, the court may order to discharge the student loans.

Debts Owed To The Court

If you owe some court fees, such debts are also not dischargeable while you are filing bankruptcy under chapter 7. Likewise, because of any criminal activity, if you owe a certain amount to the victim or the court, such amounts are also not dischargeable. Any kind of Court imposed restitution cannot be discharged. In all cases, all such debts come under the title of non-dischargeable.

Debts Associated With A Divorce Or Marital Case

If you owe a certain amount associated with a divorce or marital decree by the court, such debts also cannot be discharged under chapter 7 of the bankruptcy code. Some people have the misunderstanding that these amounts can be discharged if the ex-spouse does not have any objection, which is not true. Even if the ex-spouse does not object, these amounts come under non-dischargeable debts while you are filing bankruptcy for straight liquidation. Therefore, while you are planning to file your petition, you must keep in mind that you will not be able to discharge the debts associated with a divorce or marital case.

Certain Kind Of Taxes

All kinds of taxes except the following are non-dischargeable as per the new bankruptcy laws. Even if you are declared as bankrupt, you will still be liable to pay these taxes.

Taxes measured by gross receipts or income taxes

If the taxes are accurate and no omissions or errors in the return are found in the IRS

If the taxes are older than three tax years

What is more, if you owe an amount associated with Alimony and child support, these are also non-dischargeable while you are filing bankruptcy for complete liquidation.

Personal Bankruptcy - Understanding Homestead Exemptions

2008-03-25T02:44:00.000-07:00

When you file for personal bankruptcy, you certainly do not want to lose your home. You see this hard step as an opportunity to get rid of the mounting debts that owe to various creditors. You certainly do not see insolvency as the end of your financial life. Your intention by taking this unfortunate step is to give a fresh start to your non-existent fiscal life. No matter what the reason is that forced you towards filing bankruptcy, and how different the laws are in different states, every state provides certain homestead exemptions to the debtors. In order to make the best use of these exemptions, you must be aware of the different state laws regarding the same.

What Is Homestead Exemption

A homestead exemption is a provision in the law that protects the equity of your homestead properties up to a certain limit. Different states have defined this exemption in separate ways. The maximum limit of exemption varies from state to state. However, if the equity of your residential properties is less than the limit specified under the homestead exemptions for personal bankruptcy, you can easily protect your home from the terrifying claws of your creditors. Your house, in that case, will not be sold in order to pay the creditors’ bills.

Different State Laws

You should know that the limit specified for such exemptions vary from one state to another. Every state follows the same code of laws, but when it comes to defining exemptions and determining limits for the same, every state has the authority to define the same in different ways. Some states like Florida are very liberal for the debtors while some others have defined the exemptions in favor of the creditors.

New Changes

However, before the introduction of the new bankruptcy laws on October 2005, there had been no specified limit for such exemptions. It is only after the inclusion of these new laws that upper limits were placed on the amount of equity that could be protected. No matter how generous a particular state is in defining the homestead exemptions, there is an upper limit that you can exempt under personal bankruptcy. The amount of exemption is determined by the state. That would be the state where you have been living for the past two years before filing your petition.

Overall, we can see that it could be quite a complicated task to make the best use of the exemptions in your favor. That is the reason you are advised to hire an attorney to help you with this. But, whether you are hiring a bankruptcy attorney to handle your case or not, you are recommended to attain the basic understanding of certain exemptions, including the homestead ones.

Your home is an important asset for you and you certainly do not want to lose the same. That is the reason why you are advised strongly to understand all about property exemptions before you file for personal bankruptcy.

Limits To Automatic Stay As Per The New Bankruptcy Laws

2008-03-25T02:43:00.000-07:00

As per the new bankruptcy laws, the automatic stay has now been defined in a different way for separate situations. However, before we look into those specific circumstances, it is important for you to understand what this legal stay means and what are its applications.

Automatic Stay And Its Applications

If you owe certain debts to a creditor and do not repay the same in a timely manner, the creditor may try to harass you for the repayment. The collection call agencies are usually very good in this regard. Creditors want their money back, generally at any cost. When they find that you have stopped making the repayment, they hire these agencies. The collection agencies will harass you through mail or over the phone. However, filing bankruptcy brings an automatic legal stay that instantly stops all collection proceedings against you. As soon as you file your application, the creditors are legally restricted to stop even the foreclosure proceedings. What is more, this legal stay also stops the lenders from going ahead with any pending lawsuits against you. They are also lawfully forced to stop garnishing your wages. However, as per the new bankruptcy laws, the level of protection varies depending upon the specific cases. Let me give you a brief insight into the same.

Statement Of Intent

In case of a secured debt, the court requires you to submit a statement of intent within 30 days of filing your case. In this statement, you have to explain your plans to deal with such debts. If you fail to submit this statement to the bankruptcy court within thirty days, the automatic stay will be taken away, but only with regard to the secured creditors. However, as per the new bankruptcy laws, the trustee still has the right to ask the courts to extend the automatic stay if they think it proper.

Second Time Filing

If it is the second time you are filing under chapter 7 or 13 within a year, the court will not consider your second attempt in good faith. It will provide you limited automatic stay that is usually not more than 30 days. However, as per the new bankruptcy laws, if within this period, you prove that your filing is genuine, the court may rethink about extending the stay.

Third Time Filing

However, if it is third or fourth time that you are filing your petition, the court will not allow you an automatic stay at all. At the first look, the frequent filing of bankruptcy cases does not look genuine. Therefore, if you are filing for the third or fourth time in a row, you will have to prove to the court that the reason you are filing for chapter 7 or chapter 13 bankruptcy is genuine and in good faith.

However, as per the new bankruptcy laws, such proceedings usually takes time as you would have to convince the court about that the validity of your repeated filings and you may not be able to enjoy the best advantages of the automatic stay.

A Deep Insight Into Bankruptcy Laws

2008-03-25T02:41:00.000-07:00

Bankruptcy laws, the name itself sounds like a big, bad scary thing. Well, these laws are not at all scary. In fact, if you have a closer look into the same, you will find that they have specifically designed to benefit the debtors. However, at the same time, they have also been designed to prevent debtors from committing fraud and misusing the laws. If you are considering filing bankruptcy, there are lots of things that you need to be aware of. The more informed you are, the better are your chances of having a favorable judgment from the court.

How Many Times One Can File For Bankruptcy?

It is not like you can file for bankruptcy again and again. There are certain restrictions that you need to follow. There must be a specific length of period between two filings of such cases by the same person or business. Earlier the restrictions were a bit easier, but after the introduction of the new laws in October 2005, things have become stricter for the debtors. As per the new laws, if you are filing for chapter 7 bankruptcy this year, you will be able to file under the same chapter only after eight years, that too, only if you are truly in a very deep debt trouble and qualify to file under this chapter. The length of the period required between two chapter 13 filings is two years. Likewise, if you have filed under chapter 7 now, you will have to wait for at least four years for a chapter 13 filing.

A Word Regarding Multiple Bankruptcies

However, it is very important for you to understand that multiple bankruptcies are very bad and you must avoid this from happening. It has been found that, sometimes people take bankruptcy laws as an easy solution to wipe out all the debts they owe to the various creditors, and they get into the habit of filing for bankruptcy repeatedly. It is not an exaggeration to say that they are sick people, and it is very much like committing a fraud. What is more, it is of no good for your financial life as well. Your credit report will get the worst negative you ever had. You may not achieve a smooth financial life ever again. You will have to take another birth to achieve the same, so you had better not do this.

Borrowing Lots Of Money Just Before Filing

Sometimes, people try to be over smart, and in order to take advantage of the loopholes of the bankruptcy laws, they try borrowing lots of money just before filing. Always remember that such activities come under fraud. What is more, the recent law changes have left no scope for such frauds. Therefore, if you are trying such things, be very alert. It can put you into a much deeper trouble, which is worse than having a debt problem.

Overall, it is always prudent to be fully aware of all the aspects of bankruptcy laws. It will help you to make right decisions.

New Bankruptcy Laws - Understanding The Changes

2008-03-25T02:39:00.000-07:00

The new bankruptcy laws were introduced on 17 October 2005. Since their entry, these laws have become all the more complicated. However, the cause of most of the complications is nothing but the general unawareness. That is the reason why it is always recommended to hire an attorney while you are filing a petition in this regard. The bankruptcy lawyer are experts in this field and they know how to use the laws in your favor. They will also help you understand the laws and differentiate the same from any misconceptions.

No One Will Know About Your Bankruptcy

Debtors usually have the fear that if the court declares them insolvent, people will come to know about this, which will eventually make their social life harder. It is imperative for you to understand that there is no such provision in the new bankruptcy laws that advertises the news of your going belly-up to your employer and others in your locality. Unless you are a renowned person and a public figure, no one from the media will be interested in your case. Under normal circumstances, only your creditors and others involved in your case will get to know about your insolvency. People who are not well aware of these aspects fear filing bankruptcy because they think if their employer comes to know about this, they will be fired from the job. If your boss is not your creditor, it is highly unlikely that they will ever come to know about this. And, whichever is the case, it is important for you to understand that the new bankruptcy laws are against any such discrimination. It means that no employer can fire an employee just because they were declared insolvent. Always remember that impoverishment is not a crime. It is just an unfortunate phase in one’s financial life.

Does Bankruptcy Remove A Lien?

Some people have the confusion whether being declared as bankrupt by the bankruptcy court removes a lien. Well, there are certain circumstances under which once the proceedings of your case are started, you are allowed to file a special motion to remove certain liens. If the court orders in your favor, these liens can be removed. However, do understand that such issues are usually very complex, especially after the inclusion of the new bankruptcy laws. Therefore, you are recommended to avail legal services of an expert attorney in this regard.

This way, we can see that the reason why many people fear from filing their petition even if they are wholly eligible is nothing else but their misapprehensions. By saying that, I do not mean that insolvency is an easy way to get rid of all your debts. No, it is not. But when all doors are closed to you, it is the only and best way to save your fiscal life. It will make your complex financial world a little easier to live in and you will get another chance to exercise monetary control. Just make sure that you are aware of the new bankruptcy laws.

The Role Of A Bankruptcy Trustee

2008-03-25T02:37:00.001-07:00

If you are into deep financial trouble and are planning to file for bankruptcy, it is very important for you to be aware of the role of a bankruptcy trustee in this regard. For every case that is filed, the court appoints an impartial trustee. No matter whether you are filing under chapter 7 or chapter 13, you cannot ignore the role of the trustee. In every case, the trustee will represent the creditors. However, it does not mean that the trustee will act always in favor of creditors only. In fact, the main duty of the trustee is to make sure that everything is done as per the laws and as per the judgment of the court.

The Role Of The Trustee

The main duty of the trustee is to represent the creditors. However, this role changes, depending upon the different types of cases and the judgment given by the bankruptcy court. These legal professionals are usually the representatives of the creditors, but depending upon case to case, it is also their duty to keep a watch on the debtor’s action. For example, if it is a chapter-7 case, their duty is to make sure that all the assets and properties of the debaters have been liquidated as per the laws. At the same time, they also work in favor of the debtors, by making sure that they get the properties exceptions as per the specific laws of that particular state regarding the same. On the other hand, if it is a chapter-13 case, the bankruptcy trustee keeps a watch on the debtor’s business activity. In some cases, they even work hand in hand with the debtor in order to ensure smooth and profitable running of the business of the debtor. At the same time, they also keep a watch whether the debtor is religiously working on the repayment plan suggested by the court or not.

How Does The Trustee Work?

There are several ways a bankruptcy trustee carries out its work. However, whatever way they follow, their main objective is always to protect the interest of the creditors. For example, the trustee can distribute the funds to appropriate creditors, object to discharge, or certain exemptions a debtor may claim, collect property of the estate, liquidate nonexempt property in the estate, etc.

The Degree Of Involvement

As said earlier, the degree of involvement of the trustee varies from different types of bankruptcy. For example, since in chapter 7 bankruptcy, the role of the trustee is very limited. In chapter 13, the degree of involvement is much more. Moreover, in chapter 11, their job is multi-layered.

Overall, we can see that the job of the bankruptcy trustee is a balancing act. They do not only have to keep the interests of the creditors in mind, but it is also their duty to provide assistance in the smooth performance of the debtor’s plan. In the United States of America, there is an organization “the United States Trustee” that appoints all these trustees.

The Role Of A Bankruptcy Trustee

2008-03-25T02:37:00.000-07:00