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In February, the FBI reported pastor Karl Robinson was sentenced to four years in federal prison for his role in a mortgage rescue scam that falsely promised California homeowners they could stop foreclosure and stay in their houses by paying fees for “experienced consultants.” Unfortunately for the victims of Robinson’s scam, his financial promises were too good to be true, and their money was wasted on useless, fraudulent services. However, there is a way to stop foreclosure that doesn’t involve empty promises or criminal activity: filing for Chapter 13 bankruptcy in California. Our Roseville Chapter 13 attorneys explain how filing under this chapter enables debtors in California to keep, and remain in, their homes.

Can You Keep Your House in a Chapter 13 Bankruptcy in CA?
The short answer to this question is yes: under the right circumstances, filing for Chapter 13 with strategic timing will allow the filer to retain his or her property and avoid being foreclosed on. The long answer, of course, is more detailed.
There are numerous chapters (types) of bankruptcy, but most Californians end up filing under Chapter 7, which involves liquidation of assets, or Chapter 13, which instead focuses on reorganization or creditor repayment. It is critical to emphasize that filing for Chapter 7 bankruptcy will not prevent foreclosure from occurring.
While a feature of Chapter 7 known as the “automatic stay” can postpone foreclosure, the proceedings will continue once the case is over. Moreover, there are circumstances under which a lender could conceivably persuade the bankruptcy court to lift the automatic stay, thus depriving the debtor of its protection. While Chapter 7 bankruptcy can be immensely beneficial for the right filer in that numerous debts are discharged after a short time period, it is generally not the ideal approach for homeowners concerned about foreclosure. An experienced Roseville Chapter 7 lawyer can help you understand how you would be affected by filing under various chapters, and which type of bankruptcy is right for your situation.
The only way to save your home from foreclosure through bankruptcy is by filing under Chapter 13. If you are a resident of Roseville, Folsom, or Sacramento, you will generally file your Chapter 13 petition with the Sacramento Division of the United States Bankruptcy Court for the Eastern District of California, which is located in the Robert T. Matsui United States Courthouse in downtown Sacramento, for a filing fee of $310 (which includes a $235 filing fee in addition to an administrative fee of $75).
But why does Chapter 13 stop foreclosure, while Chapter 7 doesn’t? The answer lies with the process involved in each type of bankruptcy.
When you file for Chapter 7 in California, most of your debts, including medical debt, credit card debt, and various debts arising from personal loans, can be quickly discharged provided you abide by all bankruptcy regulations and the rules of the bankruptcy court. This means you are no longer responsible for paying the discharged debts. However, a court official called a “trustee” will sell some of your property, excluding property you’ve protected using System 1 or System 2 of California’s bankruptcy exemptions. That doesn’t necessarily mean the trustee will sell your house, particularly if you have no equity; but keep in mind that, once the bankruptcy is over, the lender will still have a lien on your home, even though your liability for the mortgage has been eliminated. That means the lender can still foreclose on your home, despite the discharge you received from the bankruptcy court.
Chapter 13 works differently, and therefore, has a different impact on foreclosure proceedings. When a debtor declares Chapter 13 in California, he or she is required to propose a long-term reorganization plan, which essentially establishes a three- to five-year course of monthly payments that the filer will make toward his or her creditors, starting with secured creditors.
Significantly, you can catch up on mortgage arrears (also called “arrearages”) by making payments as part of your Chapter 13 plan. In other words, Chapter 13 gives the filer anywhere from three to five years, depending on his or her financial circumstances, to catch up on his or her missed mortgage payments. If you can remain current on your mortgage payments going forward, and make up for the payments you have missed, you can save your home from being foreclosed upon.

Contact Our Roseville Bankruptcy Lawyers About Stopping Foreclosure
If you’re a homeowner in Sacramento, Roseville, Folsom, or the surrounding communities, and you’re worried about losing your home to foreclosure, Chapter 13 bankruptcy may be able to help you stay in your house and keep your property. However, it is vital to act swiftly. The longer you wait to speak with an attorney about how to stop foreclosure in Roseville, the fewer legal options will remain open to you. To discuss Chapter 13 or Chapter 7 bankruptcy in a free and completely confidential legal consultation, contact The Bankruptcy Group at (800) 920-5351 today.
The post Can You Stop Foreclosure in Chapter 13 in California? appeared first on The Bankruptcy Group, P.C..

Last month, a California-based adoption agency closed its doors after filing for Chapter 7 bankruptcy. Unfortunately for nearly 2,000 hopeful adoptive parents – many of whom had already sunk tens of thousands of dollars into the adoption process – the agency arguably failed to prepare its clients, instead surprising families with last-minute email notifications. Whether it is a corporation, an LLC, or other type of business entity, every company should take steps to avoid this situation by preparing for Chapter 7 and subsequent closure well in advance of filing. In order to help companies prepare for Chapter 7, our Roseville Chapter 7 bankruptcy lawyers have compiled a short business bankruptcy checklist for closing a business in California.

Types of Business Bankruptcy in CA
The vast majority of bankruptcies in California fall into one of the following categories:

1. Chapter 7 (Liquidation)
2. Chapter 11 (Reorganization)
3. Chapter 13 (Reorganization, Wage Earner’s Plan)

Business entities may not file for bankruptcy under Chapter 13, which is prohibited by 11 U.S. Code § 109(e). It is only possible to file Chapter 13 bankruptcy in California if you are filing as an individual, or filing jointly with your spouse. However, with assistance from a Roseville Chapter 13 attorney, sole proprietors may wish to utilize Chapter 13 in certain situations. C corporations, S corporations, limited liability companies, and other California business entities essentially have two filing options under federal law: file under Chapter 7, or file under Chapter 11.
Though both forms of bankruptcy may be utilized by businesses, they involve drastically different criteria and procedures – and likewise, result in drastically different outcomes. While the full explanation is more nuanced, the short explanation is that Chapter 7 is a liquidation in which a trustee sells the company’s assets and the business typically closes. Chapter 11 costs more and takes a longer time to complete, but allows the company to retain its assets and continue operating. Our Roseville Chapter 11 attorneys assist clients with both types of business bankruptcy, and are happy to answer your questions about either during a free consultation.
Chapter 7 Checklist for Businesses: Steps Before Closing
By making sure to take certain steps when filing for bankruptcy in California, you can spare your customers, your employees, and yourself avoidable headaches.

• Hire a California bankruptcy lawyer. Bankruptcy is a complex procedure, particularly if you are filing under Chapter 11, that will have a long-lasting financial impact on your liability for both personal and business debts. It is in your best interests to consult with an attorney, who, in addition to handling your legal documentation and making sure you understand your rights and responsibilities as a debtor, will also work to ensure that your case is filed with strategic timing using the chapter best suited to your objectives.
• Notify your employees. Your employees will need as much time as possible to prepare themselves for the loss of income and to seek a new job.
• Collect accounts receivable. Try to collect as much of the money that is still owed to the company as possible. It’s a good idea to do this prior to announcing closure of the company, and in some cases, may be helpful to offer a small discount as a way of encouraging customers to pay right away. You can also raise money before closing your business by holding a going-out-of-business sale.
• Notify your customers. Make sure your customers receive plenty of notice that the company will be going out of business. For example, you can issue a press release or contact local newspapers about publishing a statement. Even though the company will cease operations, it never hurts to leave a positive impression – especially because you may decide to open a new business later, after the case is closed. Make a good faith effort to wrap up any transactions or contractual obligations you’re committed to, and speak with an attorney immediately about how to handle refunds, project cancellations, and any other unfulfilled provisions of a contract.
• Submit paperwork and tax returns. After you’ve sent the final payments out to your employees, you’ll be required to file various state and federal employment tax forms, in addition to your final tax return. An attorney can help you understand which forms need to be submitted to the IRS, and by which deadlines, in order for you to fulfill your financial obligations.

CA Bankruptcy Lawyers in Roseville, Folsom, and Sacramento
The experienced California bankruptcy attorneys of The Bankruptcy Group provide an array of bankruptcy legal services for corporations, partnerships, LLCs, and sole proprietors, ranging from small family-owned businesses to large franchises with thousands of employees. If you are a business owner who is thinking about filing for Chapter 7, Chapter 11, or Chapter 13 in California, make sure you discuss your legal options with our bankruptcy lawyers before you initiate the filing process. For a free legal consultation with The Bankruptcy Group, call our law offices at (800) 920-5351 today.
The post What to Do Before Your Business Files for Chapter 7 Bankruptcy in California appeared first on The Bankruptcy Group, P.C..

In December, an Irvine-based bankruptcy attorney was disbarred after being convicted of conspiracy to commit bankruptcy fraud. The disbarment makes it clear that actual or attempted bankruptcy fraud can result in dire consequences – but you don’t have to be a lawyer to receive harsh penalties. If the trustee suspects that a filer has committed or tried to commit bankruptcy fraud in a Chapter 7 or Chapter 13 case in California, not only can there be negative ramifications for the bankruptcy, but the filer can even be criminally prosecuted. Our Roseville Chapter 7 lawyers explain what bankruptcy fraud is, and examine some of the consequences that can result from committing bankruptcy fraud.

How is Bankruptcy Fraud Legally Defined?

Bankruptcy fraud is a type of “white collar crime,” or financial crime, which is defined by federal law under 18 U.S. Code § 157. Under the legal definition established by this statute, a person commits bankruptcy fraud when he or she files a bankruptcy petition, or other bankruptcy-related document, as part of a scheme to defraud another party, including having intent to devise such a scheme.
It is also bankruptcy fraud to make “a false or fraudulent representation, claim, or promise concerning or in relation to a proceeding under title 11, at any time before or after the filing of the petition, or in relation to a proceeding falsely asserted to be pending under such title.” In other words, it is bankruptcy fraud to make false statements, or to supply false or misleading information, before or after filing, in connection with any bankruptcy proceedings, which is what is meant by “a proceeding under title 11.” (Not to be confused with Chapter 11 bankruptcy, Title 11 of the U.S. Code pertains to bankruptcy generally, including Chapter 7 bankruptcy, or “liquidation,” and Chapter 13 bankruptcy, or “reorganization.”)
Bankruptcy fraud can take several forms under these fairly broad definitions, such as filing multiple claims. One of the most common examples is concealment of the debtor’s assets, which must be listed using accurate, complete, and up-to-date information when the debtor files for bankruptcy. For example, a document called Form 106A/B (Schedule A/B: Property) requires debtors to list any buildings, land, or other pieces of property they own or have an interest in.
Bankruptcy Fraud Penalties and Consequences

For a California bankruptcy attorney, committing or attempting to commit bankruptcy fraud can result in disbarment. But what if you aren’t an attorney? Other than potentially losing your job, what other types of consequences can arise from engaging in bankruptcy fraud?
In fact, this is really a two-part question: what are the consequences of bankruptcy fraud for your bankruptcy case, and additionally, what are the criminal consequences of bankruptcy fraud?
Let’s start by answering the first question. If you intentionally hide or attempt to hide assets, or if you are suspected by the trustee to have engaged in other forms of bankruptcy fraud, the bankruptcy court could potentially deny your discharge or even dismiss your case altogether, which means not only will you remain liable for your debts, you will also lose the invaluable protection afforded by the automatic stay, which normally freezes debt collection actions while a bankruptcy case is ongoing.
In addition to losing out on the substantial financial benefits of bankruptcy, you could have even bigger worries: criminal prosecution. Though non-violent in nature, bankruptcy fraud is still considered to be a serious offense – and a conviction can result in serious criminal penalties to match. Not only does 18 U.S. Code § 157 permit convicted offenders to be heavily fined, further exacerbating any financial difficulties, it also establishes a prison sentence of up to five years, which may be imposed in place of or in addition to the fine.
Because these penalties are rooted in federal law, they apply not only in California, but to filers throughout the United States.
CA Bankruptcy Lawyers Serving Roseville, Sacramento, and Folsom
If you are looking for a skilled, experienced, and trustworthy attorney who can help you file bankruptcy individually, file jointly with your spouse, or assist with your business bankruptcy, you do not need to look any further. Serving the Roseville, Sacramento, and Folsom area, the California bankruptcy lawyers of The Bankruptcy Group have established a reputation for providing friendly, focused, and efficient representation to help make bankruptcy work for you. Whether you are a small business owner or simply an individual who is seeking a solution to make your debt more manageable, The Bankruptcy Group can assess your options, answer your questions, and help you plan your case strategically while protecting your rights as a debtor.
Our accomplished legal team includes Sacramento Chapter 13 attorneys, Sacramento Chapter 7 lawyers, Folsom Chapter 13 attorneys, Folsom Chapter 7 lawyers, and more. To learn more about how we can assist you in a free and completely confidential consultation, contact The Bankruptcy Group at (800) 920-5351 today.
The post What Happens if You Commit Bankruptcy Fraud in California? appeared first on The Bankruptcy Group, P.C..

Thanks to an error in the postal system, the late filing of a bankruptcy-related complaint was permitted under a March 3 ruling by a California district court. That decision proved unfortunate for Chapter 7 filer Michael A. Turchin, as the complaint, filed by creditor Steven Berkowitz, would make a $624,000 debt owed to Berkowitz non-dischargeable. This case brings up an important question for debtors in California: can creditors dispute which debts are dischargeable? And if so, what are some common reasons a creditor might object to a discharge? Our Roseville Chapter 7 lawyers discuss the U.S. Bankruptcy Code for answers.

3 Reasons Creditors Object to Discharge in Chapter 7 Bankruptcy

In Chapter 7 bankruptcy, debts are separated into two categories:

1. Dischargeable Debts — The filer’s liability for these debts will be wiped out when the case is discharged by the bankruptcy court. That means the filer is no longer responsible for paying off the debts which have been discharged.
2. Non-Dischargeable Debts — A bankruptcy discharge does not affect the filer’s liability for non-dischargeable debts. In other words, he or she will still be required to pay these debts off, even following a successful bankruptcy case.

Most of the major sources of debt in Californian households today, including credit card bills and medical bills, are dischargeable. However, a bankruptcy trustee or creditor can object to the discharge of a certain debt if certain criteria are met.
In order to dispute the discharge of a debt, the creditor must file a complaint in court by a certain deadline. While bankruptcy courts are strict about holding creditors and trustees to these deadlines, exceptions may occasionally be granted when filing delays are caused by forces outside of the filer’s control, such as the recent extension granted for Berkowitz’s complaint.

The grounds on which a creditor may object to the discharge of a debt are enumerated under 11 U.S. Code § 523, which creates multiple exceptions to discharge in bankruptcy cases. These exceptions, or grounds for objection, apply not only to bankruptcy cases in California, but throughout the United States.
Some are fairly straightforward, such as the provision under 11 U.S. Code § 523(a)(5) that explicitly makes debts “for a domestic support obligation,” such as alimony or child support, non-dischargeable. Others are more complex and difficult to clearly interpret and apply, which is one of the many reasons it is so important to review your debts with a skilled California bankruptcy attorney, who can help determine which of your debts are dischargeable and how you could be impacted by Chapter 7 or Chapter 13 bankruptcy.
Under the U.S. Bankruptcy Code, a few examples of debts that can be objected to include:

• Debts related to certain taxes.

• Debts, other than compensation for financial losses, that are owed to the government, such as fines and penalties, with several exceptions.

• Debts related to death or personal injury resulting from a car accident or other vehicular accident involving driver intoxication.

• Debts related to goods, property, or other items or services obtained by fraud or false statements, in addition to debts related to embezzlement or larceny (theft). For example, Berkowitz claimed he was defrauded by Turchin. A few specific reasons a creditor might object to the discharge of a specific debt, or even the discharge of your case, are that the creditor believes:
  • You used a credit card to obtain cash advances, collectively amounting to more than $950, during the 70 days before your bankruptcy.
  • You used credit cards to purchase unnecessary items during the three months leading up to your bankruptcy. In this situation, you would need to prove that the items were essential.
  • You supplied false or incomplete information when submitting a loan application.

On a related note, it’s worth pointing out that suspected acts of fraud, such as concealing assets, may lead not only to the discharge of a specific debt being denied, but potentially to dismissal of your entire case — or even to criminal investigation and prosecution. According to statistics, the IRS initiated nearly 30 investigations for bankruptcy fraud during 2016 alone, more than half of which led to the sentencing of the defendant, with an average of 17 months to serve.
CA Bankruptcy Lawyer Serving Roseville, Sacramento, and Folsom
Make sure that your rights will be protected by a knowledgeable, experienced Folsom bankruptcy lawyer who knows how to handle aggressive creditors. At The Bankruptcy Group, our California attorneys have years of experience assisting businesses, individuals, and married couples filing jointly with consumer and business bankruptcy, including Chapter 13, Chapter 11, and Chapter 7 in Folsom, Sacramento, and Roseville.
To learn more about your California bankruptcy options in a free legal consultation, contact The Bankruptcy Group right away at (800) 920-5351. We will keep your information confidential.
The post Can a Creditor Object to a Debt Being Discharged in a California Bankruptcy Case? appeared first on The Bankruptcy Group, P.C..