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Excessive debt is one of the major reasons why people file for bankruptcy. In many cases, the excessive debt is the result of paying for necessities such as medical bills and vehicle repairs. While there are some exceptions, most credit card debt can be wiped clean with Chapter 13 and Chapter 7 bankruptcy. Chapter 7 Bankruptcy […]
The post How to Get Rid of Credit Card Debt Through Bankruptcy appeared first on Allmand Law Firm PLLC.
Excessive debt is one of the major reasons why people file for bankruptcy. In many cases, the excessive debt is the result of paying for necessities such as medical bills and vehicle repairs. While there are some exceptions, most credit card debt can be wiped clean with Chapter 13 and Chapter 7 bankruptcy. Chapter 7 Bankruptcy […]
The post How to Get Rid of Credit Card Debt Through Bankruptcy appeared first on Allmand Law Firm PLLC.
The Bankruptcy Courts in Miami has recently started a new program to help people get a mortgage modification in your to help them save their home from foreclosure with the assistance of the bankruptcy court as part of their chapter 13 bankruptcy case. Most of the time, the homeowner seeks to modify their first mortgage and is able to wipe out their second mortgage as the second mortgage
is "underwater"
The program is called "Mortgage Modification Mediation" (MMM). It is available for homeowners and certain investment property owners who are seeking a modification of their mortgage and may be facing foreclosure of the mortgages on their property. As part of the MMM program, the Bankruptcy Court appoints a mediator to work with the debtor and their bankruptcy attorney in reaching an agreement. MMM has been successful in about 80% of the cases in other parts of Florida that previously instituted the program. One advantage of this program is that it provides for better communication with the mortgage lender in the process of negotiating a mortgage modification. A mediator is appointed by the Bankruptcy Court to help the parties negotiate an agreement.
As part of this process, an order is issued by the Bankruptcy Court requiring your mortgage lender to register with the internet portal and negotiate with you for a mortgage modification. The documents that are needed for the mortgage company to consider the mortgage for a modification are submitted on an internet portal for better communications. All communications between the parties is done through the MMM Portal. After the order is entered the homeowner, mortgage lender and mediator communicate and meet to mediate a modification. In the meeting, all parties must be really and able to settle all matters.Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
You probably do not even bother answering the phone because you know it is a creditor calling. It would be nice to have some peace, right?
Creditors will stop calling you immediately after you hire a law firm to file your bankruptcy case. This is even before your bankruptcy case is filed with the bankruptcy court! You tell your creditors that you hired a lawyer and that all contact must go to that attorney. They have to follow your instructions. Under the Fair Debt Collection Practices Act, once a creditor is made aware that you are filing for bankruptcy or that you have representation to file bankruptcy, they are prohibited from contacting you and they must go through your attorney.
Most bankruptcy attorneys can be retained for a small down payment toward your bankruptcy fee. Many debtors take several months of saving money to afford a lawyer to file their bankruptcy case. Those months of saving are done without the hassle of creditors calling all the time.
Photo credit: Atilla KeFeli at Flickr
1. Urban Legend - doing it inappropriately because "everybody at work did it"
2. Foreclosures - to discharge a potential mortgage deficiency on your home - the mortgage lender may never bring it
3. Exemptions - recently moved to Florida from another state, another state's exemptions apply, and alot of your property is subject to liquidation in a chapter 7 case
4. Too Much Property - substantial amount of property that is not exempt and the chapter 7 trustee is able to liquidate a lot of property
5. Too Much Income - an "abusive filing" and that will be dismissed or converted to chapter 13 or 1
6. Intangible Property - intangible property is real property. A potential personal injury claim or interest in a trust or estate may be very valuable. Non-exempt intangible property is not yours anymore when you file chapter 7 - it belongs to the chapter 7 trustee. That valuable personal claim - all the chapter 7 trustee has to do is pick up the phone and settle for whatever he deems appropriate by the Court - in most case, you get nothing.
7. Chapter 7 - when should have filed under chapter 13
8. Chapter 13 - when should have filed under chapter 7, such as little income and no non-exempt property
9. Cooperation - full cooperation with a chapter 7 trustee is required and the failure to do so may result in the lack of discharge of debt
10. Only One Large Creditor - sometimes if there is only one creditor, you are just moving the state court case over to the Bankruptcy Court - even worse, the creditor may have more power over you in a bankruptcy case
11. Valuable Real Estate in Another Country - a chapter 7 trustee can have a real estate broker in the other country sell it
12. Property Owned Together with Spouse - the exemption for property owned as "tenants by the entireties" is not always not a good bet as does not always fully work or is very difficult to prove
13. Eviction - to buy a few more days
Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
The U.S. Supreme Court will decide whether homeowners can terminate “underwater” second mortgages during bankruptcy.
On Monday, the country’s top court agreed to review two appeals from Bank of America against bankrupt homeowners who are attempting to eliminate bank liens on their properties.
Two Florida homeowners are arguing that filing for Chapter 7 bankruptcy protection with a first mortgage valuing more than their property’s worth permits them to remove the lien from the second mortgage.
The homeowners’ lawyers argue that when both mortgage loans are underwater, the second lien is effectively valueless.
Financial lenders are fighting to keep the second mortgage lien, contending the debt could one day be fully paid—especially as property values increase.
“There is no such thing as a ‘truly valueless’ lien on property capable of appreciating,” as stated in court papers filed by Bank of America lawyers.
The 11th U.S. Circuit Court of Appeals ruled that homeowners currently in Chapter 7 bankruptcy can annul a second mortgage when the owed debt is greater than the value of the first mortgage.
Bank of America appealed the decision, stating their plea “may be the single most important unresolved issue in consumer bankruptcy.”
In 1992, the Supreme Court ruled a bankrupt homeowner does not have the authority to void a lien on a submerged first mortgage; however, the judgment is not clear as to the regulations on a second mortgage.
The last bankruptcy revamp occurred in 1978, when second mortgages were much less common.
Roughly 2.1 million debtors had partially or fully underwater second mortgages by the end of2014’s second quarter, according to a CoreLogic report.
A decision is expected June 2015.
The post Supreme Court to Rule on Second Mortgage Liens appeared first on The Bankruptcy Blog.
Most commentators suggest that the days of lien stripping in chapter 7 bankruptcy cases is soon to end. Yesterday the U.S. Supreme Court granted Bank of America's writ of certiorari which will allow it to address the issue of lien stripping in chapter 7 cases.
The numerous recent appellate decisions out of the 11th Circuit have been suggesting that the issue would be considered by the 11th Circuit en banc or by the Supreme Court. The 11th Circuit Courts were forced by the "prior precedent rule" to apply its Foledore decision, which allowed lien stripping in chapter 7. Under the "prior precedent rule", the 11th Circuit held that the Supreme Court's landmark decision in Dewsnup was not explicit enough to overrule Folendore.
The Supreme Court's DocketDocketed: August 13, 2014 No. 14-163
Title: Bank of America, N.A., Petitioner v. Edelmiro Toledo-Cardona
Lower Court: United States Court of Appeals for the Eleventh Circuit, Case Nos. (13-15855)
Decision Date: May 5, 2014
~~~Date~~~ ~~~~~~~Proceedings and Orders~~~~~~~~~~~~~~~~~~~~~Aug 13 2014Petition for a writ of certiorari filed. (Response due September 12, 2014)Aug 25 2014Order extending time to file response to petition to and including October 14, 2014.Oct 6 2014Brief of respondent Edelmiro Toledo-Cardona in opposition filed.Oct 21 2014Reply of petitioner Bank of America, N.A. filed.Oct 22 2014DISTRIBUTED for Conference of November 7, 2014.Nov 10 2014DISTRIBUTED for Conference of November 14, 2014.Nov 17 2014Petition GRANTED The petition for a writ of certiorari in No. 13-1421 is granted. The cases are consolidated and a total of one hour is allotted for oral argument.Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
Most commentators suggest that the days of lien stripping in chapter 7 bankruptcy cases is soon to end. Yesterday the U.S. Supreme Court granted Bank of America's writ of certiorari which will allow it to address the issue of lien stripping in chapter 7 cases.
The numerous recent appellate decisions out of the 11th Circuit have been suggesting that the issue would be considered by the 11th Circuit en banc or by the Supreme Court. The 11th Circuit Courts were forced by the "prior precedent rule" to apply its Foledore decision, which allowed lien stripping in chapter 7. Under the "prior precedent rule", the 11th Circuit held that the Supreme Court's landmark decision in Dewsnup was not explicit enough to overrule Folendore.
The Supreme Court's DocketDocketed: August 13, 2014 No. 14-163
Title: Bank of America, N.A., Petitioner v. Edelmiro Toledo-Cardona
Lower Court: United States Court of Appeals for the Eleventh Circuit, Case Nos. (13-15855)
Decision Date: May 5, 2014
~~~Date~~~ ~~~~~~~Proceedings and Orders~~~~~~~~~~~~~~~~~~~~~Aug 13 2014Petition for a writ of certiorari filed. (Response due September 12, 2014)Aug 25 2014Order extending time to file response to petition to and including October 14, 2014.Oct 6 2014Brief of respondent Edelmiro Toledo-Cardona in opposition filed.Oct 21 2014Reply of petitioner Bank of America, N.A. filed.Oct 22 2014DISTRIBUTED for Conference of November 7, 2014.Nov 10 2014DISTRIBUTED for Conference of November 14, 2014.Nov 17 2014Petition GRANTED The petition for a writ of certiorari in No. 13-1421 is granted. The cases are consolidated and a total of one hour is allotted for oral argument.Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
The amount you are required to pay back to your general unsecured creditors in a Chapter 13 Bankruptcy Case depends on various factors. It can range from only a few pennies on the dollar to a 100% of the debt. The amount required to be paid must be the higher of the "Means Test" (projected disposable income) and the amount of the chapter 7 liquidation test.
Means TestThe amount you are required to pay back must be at least the amount of you "projected disposable income" as calculated by the "means test" used in Chapter 13. Basically, your monthly income is calculated and your expenses are deducted, leaving the "projected disposable income."
For purpose of this test, your income is based on the income for the six months period prior to the filing of the bankruptcy case. If the income changes, higher or lower, the new figure may be required to be used. The expenses used in these test are not your actual living expenses, but they are amounts based on the IRS collection standards for certain items and actual mortgage and car loan debts.The amount of expenses is deducted from the income leaving the monthly "projected disposable income." Debtor with income less than median income will only be required to pay for three years, but over-median income debtors are required to pay for five years. Chapter 7 Liquidation TestThe amount required to be paid back in a Chapter 13 case must be at least as much as the "chapter 7 liquidation test" which is the amount that could be received on a hypothetical chapter 7 liquidation of your property.Jordan E. Bublick is a Miami Bankruptcy Lawyer - www.bublicklaw.com
The amount you are required to pay back to your general unsecured creditors in a Chapter 13 Bankruptcy Case depends on various factors. It can range from only a few pennies on the dollar to a 100% of the debt. The amount required to be paid must be the higher of the "Means Test" (projected disposable income) and the amount of the chapter 7 liquidation test.Means TestThe amount you are required to pay back must be at least the amount of you "projected disposable income" as calculated by the "means test" used in Chapter 13. Basically, your monthly income is calculated and your expenses are deducted, leaving the "projected disposable income."
For purpose of this test, your income is based on the income for the six months period prior to the filing of the bankruptcy case. If the income changes, higher or lower, the new figure may be required to be used. The expenses used in these test are not your actual living expenses, but they are amounts based on the IRS collection standards for certain items and actual mortgage and car loan debts.The amount of expenses is deducted from the income leaving the monthly "projected disposable income." Debtor with income less than median income will only be required to pay for three years, but over-median income debtors are required to pay for five years.Chapter 7 Liquidation TestThe amount required to be paid back in a Chapter 13 case must be at least as much as the "chapter 7 liquidation test" which is the amount that could be received on a hypothetical chapter 7 liquidation of your property.Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
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