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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..

If you’re thinking of filing for bankruptcy, take the advice of an experience, bankruptcy attorney. Be honest, truthful, open and revealing when dealing with your bankruptcy lawyer. If you have assets that are going to be unprotected, your lawyer will advise you with regard to those assets. If you have made transfers that could be+ Read More
The post Full Disclosure Always Best In Bankruptcy appeared first on David M. Siegel.

Wynn at Law, LLC is frequently on the lookout for its clients when it comes to their two largest investments: The retirement nest egg, and the family home. We’ll talk about the nest egg, wills, estates, and wealth transfer several times in the coming weeks. However, this week I’ve noticed how low real estate inventory is in southeast Wisconsin, so let’s cover what that means for the legal rights of buyers and sellers.
Low inventory means it is a seller’s market and that’s excellent news if you have a property to market. Typically bidding favors you:  It’s supply and demand. However, deals can still be found for buyers in the market today. The key on either side of the transaction is an effective attorney, and here are five reasons why.
1) Offers need speedy attention during a low-inventory cycle. No buyer should make one, no seller should accept one, without a legal review. Real estate agents all know attorneys for this reason. (Did you know you can choose your own instead?) Without an experienced real estate attorney in a buyer’s corner, it gives time for other buyers to enter the bidding.
2) Home sellers are more inclined to go For Sale By Owner (FSBO) when the inventory is light. Their theory is that real estate agents add value when there is a glut of homes on the market. In my opinion, the theory is a little over-simplified, but to each, their own. A buyer’s attorney makes sure the transaction represents the buyer’s best interests… the FSBO seller’s attorney ensures the seller’s rights are protected in the face of mortgage lenders and the legal transfer of the deed.
3) A seller’s market often triggers buyers to take on properties as-is or with minimal improvement in order to beat other buyers to the table. Wynn at Law, LLC sees several lake properties a year that fall into this category in buyer’s markets, too. A buyer’s attorney makes sure the client doesn’t get in over his or her legal head.
4) Time is a recurring theme here. The attorneys coordinate the closing to encompass every detail in one sitting. A missing deed or inspection will impact the mortgage which will impact the deal.
Know how many initials and signatures are involved in the transaction? Dozens. All are binding. It seems monotonous. It can also seem threatening. Attorneys add value by taking emotion out of a big investment and scrutinizing every detail, which saves time, money… or both in a seller’s market.
 
*The content and material in this original post is for informational purposes only and does not constitute legal advice.
Photo by Alex Raths, used with permission.
The post Enlist an ally in a seller’s real estate market appeared first on Wynn at Law, LLC.

After Bankruptcy: Tammy Gets A Car Loan at 4.48% The same week that her bankruptcy was discharged, Tammy got a car loan at 4.48%.  Now I sure don’t suggest trying to buy a car the same week your bankruptcy is over. But Tammy had no choice. Three weeks before her car was totaled in a […]