Blogs
Imagine you’re going into college and staring at a bill for $25,000 for tuition and assorted other fees for your first year of school.
You’ve got two ways to pay the bill. You can take out a combination of federal and private student loans, or … you can agree to pay to a lender a set portion of your earnings over a defined period of time.
The latter is called an income share agreement, a concept originally proposed by economist Milton Friedman in his 1955 essay, The Role of Government in Education. Under an ISA, an entity (could be an investor, a bank, or even an employer) would give a student the money to pay for a college or graduate education in exchange for a fixed percent of the student’s future income to be paid for a fixed period of time.
For an example of what an ISA looks like, here’s the one offered by a company called Upstart.
There’s been renewed interest in the ISA over the past few years, including Investing in Student Success Act of 2014, a bill to increase the use of ISAs.
Now here comes Pave, a company that offers an income sharing agreement as an alternative to the traditional student loan. According to its website the company makes lending decisions based not only on FICO score but also on, “alternative factors that might demonstrate financial responsibility and creditworthiness, like education, employment history, current job status and future potential.”
Here’s a recent interview with the Pave CEO to learn more:
An income share agreement sounds like a great idea. The lender is more of a partner in the student’s future success. There’s an incentive for the lender to help the student get a good job because the higher the income, the better the lender’s return on investment. In situations where the school is the lender, bad job placement means the school has to do a better job of educating people in the first place because a failure to do so loses money for the school.
It’s great for the student as well, bringing income based repayment into the arena of private lending. Borrowers know that their payments won’t exceed a certain portion of their income, so they don’t have to worry about repayment quite as much as is currently the case with private student loans.
Looking at it that way, the ISA sounds fantastic for everyone involved.
But the income sharing agreement has some problems. If you can’t see them, consider that the economist who proposed the concept is the same one who is responsible for trickle down economics, an idea widely embraced in the 1980s and now just as widely vilified.
Who’s going to receive an ISA? Not the 18 year old undergraduate at a mid-level college who thinks she wants to be a math teacher at a public school. And definitely not a community college entrant who has yet to figure out what he wants to do with his life.
Instead, the ISA will be reserved for those who attend the top universities and opt for the major with the best employment options after graduation. People getting an MBA or other professional graduate degree will be more likely to have the earning record and career path that leads to the best job, so more money will go to them than to undergraduates.
Choosing a major based on return on investment is a great idea, right? After all, we don’t want a bunch of people getting degrees in Underwater Basket Weaving, do we?
But consider the long term impact of those decisions. Over time the market becomes flooded with computer science engineers and professionals from the top schools. Lesser schools, filled with the cast offs who can’t get better funding for their educational endeavors, struggle to attract the top talent. With graduates less likely to go into high paying fields, those schools suffer from a decline in alumni contributions.
At the same time, students from the best schools stop picking a course of study that includes English, history and philosophy because they know it’s not going to allow them to get the ISA. The inventory of teachers coming from excellent universities dries up, leaving universities with only those graduates who didn’t qualify for an ISA in the first place.
The rich get richer, the poor get poorer. And over a fairly short period of time, we as a society become dumber as the next generation becomes less likely to learn about history, philosophy, literature and similar fields.
First in your family to go to college? Recent immigrant? Slightly older student with some bad credit and employment history? Forget an income sharing agreement because you’re less likely to have the employment track record to please the lender. Instead, you’ll be left with the high cost private student loan, which will be even more expensive as banks recognize that they have more leverage than ever with those least able to get more attractive financing.
This isn’t to say that income sharing agreements are a bad idea – they’re a different way to approach the spiraling costs of higher education. But don’t buy into the idea that it’s a cure for what ails the world of higher education.
the income share agreement is an idea that’s more likely to work for graduate students in a field of study that’s in high demand.
For everyone else, it’s just another reminder of the growing divide between the haves and the have nots.
The post Income Share Agreements, and Their Role in Higher Education Inequality appeared first on Bankruptcy and Student Loan Lawyers - 866.787.8078.
In just thirteen months, Maria’s credit score after bankruptcy was above the national average Are you one of the people who still thinks bankruptcy hurts your credit score? Maria M was worried about her credit score when she came to talk to me in November 2013. That’s part of the reason she put off filing bankruptcy […]The post Maria’s credit score after bankruptcy is 640 by Robert Weed appeared first on Robert Weed.
According to a fellow lawyer, JayFleischman · August 28, 2015, a proclaimed expert in student loans and bankruptcy, federal student loans can be discharged if you are totally and permanently disabled. And you can do it without filing for bankruptcy.
Unfortunately, getting the U.S. Department of Education to approve your discharge request isn’t always so simple. The procedure can be complicated, and it’s easy to make a mistake that can cost you thousands of dollars.
Read more….
As with everything you read or hear – use your common sense before jumping in; this includes hiring a lawyer or trying the latest craze – a chocolate covered burrito.
The post Disability Discharge for Federal Student Loans appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.
The doorbell rings, and there’s a strange guy standing there. He asks for you by name, hands you some documents, and walks away.
Congratulations, you’re being sued.
It’s a story that plays out thousands of times a day. People fall behind on credit card debts, can’t pay the collectors, and find themselves named as defendants in collection lawsuits.
This happens so often that some law firms do nothing but sue consumers for past due debts. Huge operations, these firms file thousands of lawsuits every day.
Suing For Credit Card Debts Is Big Business
The business model is simple – file a lot of collection lawsuits with the expectation that most people will do nothing so the law firm can get a default judgment. With a default judgment in hand, the collection lawyer can force payment through wage garnishments, bank account levies, and more.
It’s a profitable model for these collection lawyers. In fact, nearly 98% of all people who get sued for a credit card debt take no action whatsoever. Some people are confused about what to do, others simply shrug and figure there’s nothing they can do.
A few end up filing for bankruptcy to either wipe out the debt or pay it off over time.
Doing Nothing Is A Terrible Idea
When a lawyer sues you, all they need to do is make a claim that you owe money. They don’t need to come up with much evidence in order to support that claim – that’s the way the law is written.
You, as the defendant, have the right to challenge the lawyer’s claims and raise any defenses you may have. You are also allowed to make any claims you may have against the creditor, as well as any reasons why you shouldn’t be held responsible for the debt even if all of the claims are correct.
But there’s a limited amount of time for you to make those challenges. Once the clock runs out, you no longer have the right to bring them up.
Any protections you may have had go out the window, and you’re left legally liable for whatever the lawyers claim you owe.
If You’re Sued For A Credit Card Debt, Take These Steps
Lucky for you, you’re not going to do nothing about the lawsuit. You’re going to stand up for your rights, throw down the gauntlet, and force the credit card company’s lawyers to prove every claim they’ve made against you. Maybe you’ll win, maybe you’ll lose – either way, you’re going to make them earn every penny they’re trying to get from you.
Here’s what you’re going to do.
- Don’t panic. Nothing terrible is going to happen to you so long as you keep on top of the situation.
- Identify who’s suing you. This is the name you’ll see before the word, “Plaintiff.”
- Identify who’s being sued. This should be your name. If your name doesn’t appear here then you’re not being sued. If someone else’s name appears with yours, that person is also being sued – you should have a talk with them abut what’s going on.
- Note the name of the law firm representing the Plaintiff. These are the people you need to communicate with from now on. The creditor won’t communicate with you directly anymore (that’s why they hired the lawyers).
- Write down the date, time, and how you got the papers. Remember, you’ve got a limited amount of time to do anything about the lawsuit before the court enters a judgment against you. Better to know when the clock starts running than to guess about it later on.
- Review the claims. You’ll want to read the Complaint carefully because it will give you valuable information about the name of the original creditor (the debt may have been sold or transferred, so the Plaintiff may not be the same as the original company) as well as the amount of money they claim you owe.
- Organize any documents you have. Go through your files, bank account records, and old mail to get any information you may have about the credit card debt. Even if you don’t think a document is important, it may contain helpful clues.
- Get your most recent paystub and tax return. These financial documents will help analyze your ability to pay a settlement or judgment, as well as to understand what you may have at risk in the event of a wage garnishment or bank account freeze.
- Talk with a collection lawsuit defense lawyer. You aren’t legally required to have a lawyer represent you in court, but you should make sure to talk with an attorney who practices in the field of collection lawsuit defense. Even if you don’t hire that attorney or decide to go it alone, it’s important that you have all the information you need to figure out if you’ve got any valid defenses or should use the magic words. An attorney will also tell you how long you have to file papers with the court to protect yourself – and what the impact of a judgment will be on you.
- Show up. You have to either hire a lawyer or go to court to file papers within the period of time provided for under the law (a phone call to the credit card company’s lawyers won’t protect you). If the court schedules a hearing, you or your lawyer have to appear in the right place and at the right time. When a trial is scheduled, you need to be there as well. If you don’t do what you’re required to do, the creditor wins a judgment against you. That’s why it’s important to always show up – there’s no legal excuse for forgetting to file papers with the court or for failing to hire a debt collection lawsuit defense lawyer on time.
Follow The Rules To Be Treated Fairly
If you fail to follow these guidelines you will lose the case and have a judgment filed against you.
I’m not saying you’ll win the case if you follow these 10 steps – but you will force the credit card company’s lawyers to prove their case and show them you’re not going to let them take advantage of you.
At the very least, your chances of a settlement go up if you take your responsibilities seriously. And in the end, that’s better than a judgment and all it entails.
The post 10 Steps To Take If You’re Sued For A Credit Card Debt appeared first on Bankruptcy and Student Loan Lawyers - 866.787.8078.
Interesting article in Bloomberg Business regarding Consumer Financial Protection Bureau (CFPB) “a record 26,704 complaints were registered in July, up 15 percent from the previous month and up 20 percent from a year ago. The CFPB regulates a wide range of consumer financial products, with the notable exceptions of investments and insurance. Debt collectors inspire the most complaints, followed by problems with credit reports and with mortgages. Rather than once again calling customer service and waiting on hold, people can complain to the CFPB online or over the phone. Within days, those complaints are reviewed and routed to companies electronically. Companies must respond within 60 days. ”
Read more..
NOTE FROM DIANE: Bullies can only be stopped by standing up to them. Banks, credit collection companies and the like have lost all sense of responsibility or accountability when it comes to collecting debts. In the four years that CFPB has existed it has done more to quash creditors and collection companies abuse of consumers and downright fraud than any governmental organization.
When you are being abused or bullied stand up for yourself and complain to someone who can do something. Be loud and insist on your right to peace and security. Yes, this includes abusive collection companies. There are laws governing their actions – the federal Fair Debt Collection Practices Act. In addition, any states have debt collection laws.
The post Consumer Complaints at an All Time High. CFPB Leading the Charge. appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.
Just about everyone who files for bankruptcy worries that they’ll never get a mortgage.
It’s not true – in fact, it’s never been true. That’s not to say you can go from the bankruptcy court right to the mortgage broker, either.
You’ve got to take steps to rebuild your credit standing, save for a down payment, and stabilize your income in order to qualify for a mortgage.
Until recently, Fannie Mae had a waiting period of 4 years between the time a Chapter 7 or 11 bankruptcy case finished and when you could qualify for a mortgage. Chapter 13 cases had a waiting period of 2 years after discharge, or 4 years if the case was thrown out of court.
The Federal Housing Authority loosened their standards a few years back, and now the government controlled mortgage giant will do the same.
According to The Mortgage Reports:
Borrowers can now re-apply for a loan just two years after a bankruptcy, short sale, or pre-foreclosure. This is one year longer than the FHA’s minimum waiting period via its FHA Back to Work program, and a major improvement for conforming mortgage borrowers nationwide.
Mortgage guidelines are loosening across all loans and Fannie Mae is now the most recent government group to help borrowers who have a history of poor credit because of bankruptcy, short sale, and pre-foreclosure.
This is good news, of course. According to the company’s earnings report for the fourth quarter of 2014, it is the largest single issuer of single-family mortgage-related securities in the secondary market with an estimated market share of 40 percent. The company also owns or guarantees approximately 19 percent of the outstanding debt on multifamily properties.
The market leader has loosened the purse strings when it comes to people coming out bankruptcy, so more people will qualify overall.
But don’t think this is all part of some good will effort. People coming out of bankruptcy have very little debt if any, which means they’ve got more money to spend on mortgage payments. Home ownership is lower than at any time in nearly 50 years, and allowing more people to qualify for a mortgage will help lift those numbers.
And don’t forget that qualifying for a mortgage is more than simply a bankruptcy issue. Borrowers need to have steady income to meet the costs of the mortgage payment as well as a down payment towards the purchase price. That will continue to be a problem for many, especially given the fact that debts such as student loans remain a post-bankruptcy nightmare for millions of people.
Finally, remember that Fannie Mae needs more people to take out mortgages in order to continue to profit from mortgage-backed securities. Bringing more post-bankruptcy consumers into the fold makes sense not only for the housing market but also for the company’s bottom line.
So if you just got out of bankruptcy, rejoice – your mortgage is closer now than ever before. Just make sure you’re financially ready when you make the jump into home ownership.
The post Why The Government Is Making It Easier To Get A Mortgage After Bankruptcy appeared first on Bankruptcy and Student Loan Lawyers - 866.787.8078.
Lake Geneva, WI – September 3, 2015 – Wynn at Law, LLC, a Southeastern Wisconsin law firm, announces the expansion of its Wisconsin legal team with a new appointment.
According to Shannon Wynn, Principle of Wynn at Law, LLC, “The law firm is growing, and our clients are asking for additional services. Thus, Wynn at Law, LLC needed to grow in order to meet our clients’ demands. On the heels of opening several new office locations, we have started to build our team. With the expanded team, we will continue to build our expertise and expand our service areas. Our highly skilled legal team allows us to deliver desired results with the attention to service that our clients need and deserve.”
The newest appointment to Wynn at Law, LLC’s legal team is Alyssa S. Wilson. Attorney Wilson was born and raised in Walworth County, graduating from Big Foot High School. She went on to receive her undergraduate degree from University of Wisconsin – Madison in 2007, and graduated from Drake University Law School in 2011. She is committed to providing legal support to members of her community. Alyssa concentrates her practice primarily in areas of real estate, estate planning, probate, business law, employment law, and workers’ compensation.
“With the new appointment of Attorney Wilson, I’m proud to say that Wynn at Law has begun to build a first-class team of legal talent,” said Attorney Shannon Wynn. “Southeastern Wisconsin residents have our undivided attention. We can now help more members of our local communities due to our growing portfolio of legal services.”
Wynn at Law, LLC focuses on bankruptcy, business litigation, foreclosure, debt repair, real estate law, landlord/tenant law, foreclosure, repossession defense, debt collection, probate, estate planning, and now employment law and workers’ compensation. Wynn at Law, LLC has law offices located in Lake Geneva, Delavan, Salem, and Muskego, Wisconsin. More information regarding the law firm can be found on the website by visiting http://wynnatlaw.com.
About Wynn at Law, LLC
Wynn at Law, LLC is headed by Shannon Wynn, an experienced bankruptcy, debt relief, real estate, and estate planning attorney. Attorney Wynn was born and raised in Walworth County. She graduated Valedictorian from Big Foot Union High School, completed an undergraduate degree at Vanderbilt University with honors, and graduated with honors from Marquette University Law School. She currently teaches at Marquette University Law School in addition to running her practice. Attorney Wynn has received the CALI Award for The Law Governing Lawyers, the CALI Award for Drafting the Wisconsin Real Estate Transaction, the AVVO Client’s Choice Award in Bankruptcy, and has received the Super Lawyers Rising Star award on several occasions. She is a member of the Wisconsin Realtors Association, National Association of Consumer Bankruptcy Attorneys, Wisconsin Bar Association, American Bar Association, Walworth County Bar Association, Kiwanis Club of Elkhorn, and A Day in Time Board Member.
On September 2, 2015, Hulu announced that it would offer an ad-free level of its popular streaming service. This prompted a lot of my Facebook friends to start talking about cutting their cable service.
According to the company’s press release:
Viewers now have the choice to watch Hulu commercial free for $11.99 per month or with limited commercials for $7.99 per month. Current Hulu subscribers will maintain their existing subscription, but will have the choice to switch to the commercial-free option at any time for an additional $4 per month. For viewers who choose to watch content with limited commercials, Hulu will continue to show fewer commercials than scheduled television.
With so many options out there for getting your favorite shows on demand, is there any reason to keep paying for cable or satellite TV?
For years I’ve watched my clients struggle with cable bills that come to well over $200 each month, draining their wallets for the privilege to do the same things we used to get for free – watch television.
Sure, there are more options now than there were when I was a kid. In spite of that, most people struggle to find something interesting to watch. Many compelling programs continue to come from the major networks, with the rest shown on channels we’re forced to pay for.
I’ve been a proponent of cutting the cord and ditching cable television for a long time, but it was only when we moved that I took the plunge.
It’s been over two years, and I’m pleased to report that I am now saving $80 per month. Here’s how I did it.
Get A Device To Stream Programs
In order to cut the cord and be able to keep getting the content you want, you’re going to need to have a set top device that connects to the Internet. That device will wirelessly access your Internet connection and plug into your television, essentially functioning as a tiny little computer for your TV.
You’ve got lots of options when it comes to devices, and I’ve found that most of them are interchangeable. I opted for the Roku 2 Streaming Media Player, which allows me to add channels to access Amazon Videos, Hulu, Netflix, and a bunch of others. It hooked up to my television easily, and setup amounts to entering in your wifi password.
These days there are a number of options that are less expensive and just as good. They include:
- Apple TV ($62.10)
- Roku Streaming Stick ($39.99)
- Amazon Fire TV Stick ($34.00)
- Google Chromecast HDMI Streaming Media Player ($29.99)
What’s the difference? For the most part, not much – they all give you access to the channels I mentioned. Apple TV allows you to buy TV shows and movies from the iTunes Store, so if you’re deeply involved in that platform then you may want to stick with that device over the others.
Subscribe To Streaming Channels
There are a number of paid streaming options, each of providing slightly different programming options. You’ll need to go through each one carefully to make sure you’re getting the right subscription, but the good news is that none of them require a long-term commitment. Subscribe to one, use it for a month, then drop it if it doesn’t meet your needs.
Some of the more popular streaming channels are:
Netflix (free trial, then $7.99 per month): Netflix gives you access to a lot of movies and television shows, including original programming such as House of Cards, Narcos, and Frankie and Grace. You can also watch Netflix-only episodes of Arrested Development and Wet Hot American Summer if that’s up your alley. Netflix has a great selection of shows for kids, including PBS Kids.
Sling TV (free trial, then plans begin at $20 per month): For years, the thing that kept people hitched to their cable subscriptions was the ability to watch sports. Sling TV blew this one out of the water when it introduced this service, which includes pretty much every variation of ESPN, as well as TBS and TNT.
You also get HGTV, The Food Network, Cartoon Network, Disney Channel and Disney Junior, and new channels such as CNN and Bloomberg. There’s also AMC and A&E. In other words, pretty much everything you’re going to watch on basic cable.
The only downsides are that you have to watch live (no DVR or on demand options yet), and there are commercial breaks.
Hulu ($7.99 per month with commercials, $11.99 without): Every show on ABC, Fox, NBC, WB, The CW, Lifetime, Comedy Central, FX and Bravo are on Hulu. There are also movies and some old shows to keep you busy when the networks end their seasons). There’s a free level with more limited options, but the price is so low there’s no reason to stick with the free plan.
Amazon Prime ($8.25 per month, which comes to $99 per year): Amazon Prime Videos includes some good stuff, and lots of old movies. Amazon is breaking into original programming to compete with Netflix, so it’s not an awful choice. If you order from Amazon and enjoy the free shipping with Prime then you should sign up. If not, it won’t make much of a difference in your life.
Keep Your Internet Access
You need to have solid Internet access if you’re going to pump video content to your television. Don’t cancel it, and make sure you have decent service.
If you’ve had your service for awhile, call your provider and be sure you’ve got their most recent router.
For those who want to save even more money, consider buying your own router (make sure you talk with your provider to ensure your chosen model is compatible before you buy).
What About Your Home Phone?
Lots of people don’t have a landline phone anymore, which makes the whole, “I need cable service because I’ve got the Triple Play,” argument pointless. If you can’t remember the last time you used your landline then this applies to you as well.
Many of my clients don’t want to lose their local phone number because they’ve had it for years. If you fall into this camp, call your cell phone provider and port the number to a cheap phone you can pick up on eBay for $20 (turns out your old flip phone from 2002 still has some value).
Count The Savings
When I had cable television, I was spending $190 every month for the service, the set top DVR, and the privilege of watching my money go to Time Warner Cable. Now I spend $94.22 – a savings of about $95 a month, or $1,140 a year.
Here’s what I spend each month now that I cut the cord:
- Netflix ($7.99)
- Hulu ($7.99)
- Sling TV ($20.00)
- Amazon Prime ($8.25)
- Internet access ($49.99)
We haven’t used a landline phone for years, so that part wasn’t an issue for us. If you need to port your number to an old flip phone, you can reduce your savings by about $15 each month for an additional line on your account.
All of the streaming services are available on your iPad, Android phone, and iOS device. That means you can watch your favorite shows and movies when you’re traveling, during downtime during your day, and in some cases in the subway (Amazon allows offline access for their television shows and movies).
More convenience at a lower cost. What’s not to love about cutting the cord?
The post How I Save $1,140 A Year On Cable Television Service appeared first on Bankruptcy and Student Loan Lawyers - 866.787.8078.
By: Steven P. Taylor
Law Office of Steven P. Taylor, P.C.
August 31, 2015
Commonly, in consumer bankruptcy cases, Debtors have attempt resolve their financial issues by raiding their retirement accounts. For those debtors that are younger than 59 ½ years of age, this leads to the 10% additional tax (an “exaction”) of the withdrawn amount as part of their current tax bill in addition to the normal income tax. Bankruptcy may be an appropriate method to deal with tax debt and other times it’s not-and something like the Offer in Compromise program may be a much better option than bankruptcy tax relief.
In the bankruptcy world, whether the Internal Revenue Service has assessed a “tax” or “tax penalty” has different implications. The priority scheme treats income taxes and tax penalty claims differently. Income taxes that a debtor owes to the government are entitled to eighth priority distribution under § 507 of the Bankruptcy Code which are not dischargeable. In contrast, tax penalties that do not compensate for the government’s actual pecuniary loss are subordinated to general unsecured claims and are dischargeable.
In a Chapter 7 bankruptcy, the exaction not entitled to priority status under §507(a)(8), but will not be dischargeable under §523(a)(7). In Re Mournier, 232 B.R. 186 (Bankr. S.D. Cal. 1998). In a Chapter 13 bankruptcy (§523(a)(7) does not apply) there is Tenth Circuit opinion, In Re Cassidy 983 F.2d 161 (10th Cir. 1992), where the Court rejected contentions that the 10% amount was entitled to §507(a)(8) priority status either as income tax or a penalty in compensation for actual pecuniary loss. See also In Re Cespedes, 393 B.R. 403 (Bankr. E.D.N.C. 2008).
Recently, the Court, Bradford v. United States Department of Treasury – IRS, 14-11805, a case from the United States Bankruptcy Court, Middle District of Georgia, Albany Division, looked at the dischargeability of this 10% exaction again. In this Chapter 13 bankruptcy case, the Internal Revenue Service asserted a priority status for the 10% due to early withdrawal of the Debtors from a retirement account under 11 U.S.C. §507(a)(8), either as an income tax (§507(a)(8)(A) or, alternatively as a penalty compensating the government for actual pecuniary loss (§507(a)(8)(G)). The Debtors contended that the 10% exaction was a penalty and that the penalty was not in compensation for actual pecuniary loss and thus not entitled to priority. The parties agreed that if the 10% penalty did not fit into a subcategory of §507(a)(8), it was not entitled to priority treatment under the Debtors’ plan. The Court, in a 36 page opinion, found that the classification by Congress of the 10% exaction as a “tax” was not determinative based upon Supreme Court precedent. The Court, following a functional analysis, found the 10% exaction was a penalty for purposes of §507(a). Furthermore, the Court found that the penalty was not to compensate the government for actual pecuniary loss and not entitled to priority status.
TALK TO A BANKRUPTCY ATTORNEY
The interaction between bankruptcy and tax laws can be extremely complicated. In some cases, simply waiting to file your bankruptcy can turn a priority tax debt into a nonpriority obligation. For these reasons, if you want to file for bankruptcy to eliminate or reorganize your tax debts, consider talking to a knowledgeable bankruptcy attorney in your area first to learn about your options.
Filed under: Chapter 13 Bankruptcy, Taxes Tagged: Chapter 13 Bankruptcy, tax discharge 
Divorce causes stress and amplified emotions for all family members. Once you realize you must also reconcile marital debt, you can double the stress for you and your spouse. Filing a Kenosha bankruptcy before divorcing, preferably jointly, can be a great solution to marital debt problems. We’ve put together a list of seven reasons why filing a Kenosha bankruptcy before divorcing may be the perfect option for you and your spouse.
1. Filing bankruptcy jointly before a divorce to save money. When you file a joint Kenosha bankruptcy, debts can be cleared under one bankruptcy case, thus saving a lot of money on court and attorney fees. If you qualify for a Chapter 7 Kenosha bankruptcy, you both can eliminate unwanted debts, such as your credit card and medical debt. A bankruptcy may also decrease your divorce costs as well; you will avoid arguing over debt and simplify your divorce filing.
2. Bankruptcy may wipe out your responsibility to pay any debt as part of the divorce agreement. If you have an uncooperative spouse who refuses to file bankruptcy jointly, go it alone. Remember, do not agree to any conditions of your divorce that would require you to pay any part of any joint debt. Your Kenosha bankruptcy discharge freed you from those financial obligations. On a side note, you cannot file bankruptcy on debts you agreed to pay during your divorce. In order to be free of any marital debt, you must file bankruptcy first.
3. Reduce Stress. If you and your spouse qualify for a Chapter 7 Kenosha bankruptcy, you both can eliminate unsecured debt. This means no fighting over who pays what. Your Kenosha bankruptcy will be discharged in approximately 90 days. It can be fast and stress free with an experienced Kenosha bankruptcy attorney.
4. Increase Exemption Amounts. If you file jointly for bankruptcy before a divorce, you may be able to increase your exemption amounts and qualify for a Chapter 7 Kenosha bankruptcy. The State of Wisconsin allows you to double exemption amounts when you file jointly which means you are able to keep most if not all of the property you own.
5. Don’t Get Stuck with Your Spouse’s Share of Debt. If your spouse decides to file bankruptcy alone before or during the divorce proceedings, it can put a huge damper on things, especially for you. If his or her bankruptcy is discharged, you may be held responsible for all joint debts incurred during the marriage. This can lead to collection efforts, lawsuits, and a hindered credit score.
6. Save Your Marriage. According to several studies, the number one reason couples get divorced is financial trouble. Financial stress directly affects your marriage and can tear it down. Filing for bankruptcy prior to filing for a divorce may inadvertently save your marriage. It’s possible that all your marital issues will be resolved once your money issues disappear.
7. Save time. If any spouse files bankruptcy during the divorce proceeding, the divorce will be paused until the bankruptcy case is closed. This will drag out your divorce proceeding. It could make a very stressful and emotionally painful process longer and more expensive than usual. The best option is to file amicably and jointly together for a Kenosha bankruptcy before a divorce, if possible.
At Wynn at Law, we understand that divorce and bankruptcy are both stressful subjects for you. There are hard decisions for anyone to make. It helps to seek the assistance of a knowledgeable Kenosha bankruptcy attorney who can bring you peace of mind during this trying time. You have big changes impacting your life. We are here to help.
We offer free bankruptcy consultations. If you are planning to file a divorce, feel free to schedule a free initial consultation with our Kenosha bankruptcy attorney. Find out what your options are and if Wynn at Law is the right fit for you. You can reach our skilled Kenosha bankruptcy attorney by phone at 262-725-0175 or by email via our bankruptcy website’s contact page. We have bankruptcy offices conveniently located in Lake Geneva, Delavan, Salem, and Kenosha. We have a 100% bankruptcy discharge success rate. Call us today.
Find out if you qualify for bankruptcy.
Click Here to Get a Free Bankruptcy Assessment
from Wynn at Law, LLC
.
It’s Free. It’s Easy.
*The content and material on this web page is for informational purposes only and does not constitute legal advice.
Updated daily, this blog will keep you informed on the latest bankruptcy news! 
Learn more about how Bankruptcy works and what you need to know.