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Bankruptcy Help Is Harder To Get When you are struggling financially, you need bankruptcy help. You need to find a bankruptcy attorney that can take you from point A to point B. You want to get out of debt, you want to get a fresh start, you want to get back to a life without+ Read MoreThe post It Keeps Getting Harder To Obtain Bankruptcy Help appeared first on David M. Siegel.
Behind on the rent? Looking to buy yourself some more time, maybe even wipe out the obligation to the landlord altogether?
If so, you may be tempted by the prospect of filing for bankruptcy.
Filing for bankruptcy will usually wipe out the balance due for past due rent as of the date on which the case is filed. Rent for any period after the case is filed won’t be wiped out, though.
But if you time your bankruptcy correctly, you may also be able to buy some more time in the place before you have to move out.
The Automatic Stay
The filing of a bankruptcy petition stops all efforts at collection, including an eviction proceeding. This automatic stay remains in effect until a creditor makes a request to the court and that request is granted, or until the case is closed or dismissed, or when your discharge is granted.
This means that, under normal circumstances, the eviction action has to stop the minute your bankruptcy case is filed with the court.
Stopping the eviction means you get some extra time before you need to move out.
Landlord’s Exception To The Automatic Stay – Judgment Of Possession
If there a judgment for possession of the property due to failure to pay rent was issued before the bankruptcy case is filed, there is an exception to the automatic stay.
This exception to the automatic stay would not apply if you do all of the following:
- specially mark the petition indicating a judgment of possession has been obtained on the rental property;
- provide the name and address of the landlord that obtained the judgment;
- file with the petition and serve on the landlord a certification under penalty of perjury that, under the applicable landlord-tenant law, there are circumstances under which you would be permitted to cure the entire monetary default that gave rise to the judgment for possession;
- along with the petition, deposit with the Clerk of the Bankruptcy Court any rent that would become due during the 30-day
- period after the filing of the bankruptcy petition; and
- within 30 days of the filing of the petition, file with the bankruptcy court and serve on the landlord a further certification (under penalty of perjury) that the entire monetary default has been cured.
Landlord’s Exception To The Automatic Stay – Non-Monetary Eviction
If you’re being evicted because of a reason aside from failure to pay the rent – for example, conduct causing a health and/or fire risk; use of illegal drugs on property – then there is an automatic exception from the automatic stay.
This exception applies only to residential property in which you reside, if you are “endangering” the property or using, or allowing to be used, illegal controlled substances on the property.
In order for this exception to apply, the landlord must file with the court, and serve on you, a certification under penalty of perjury that such an eviction action has been filed, or that you, during the 30-day period preceding the date of the filing of the certification, have endangered property or illegally used or allowed to be used a controlled substance on the property.
If such a certification is filed then you are required to file an objection with the court and serve such objection on the landlord within 15 days of the landlord’s certification. The court will hold a hearing, and you have the burden of proving that the landlord is incorrect.
Time Your Bankruptcy To Maximize The Benefit
Depending on your goals, the timing of your bankruptcy filing can be really important.
If you’re looking to wipe out as much of the deficiency as possible, file your case as late as you can.
But if you want to buy a little time before you have to pack up and move, you may want to file before the possession order comes down from the housing court judge.
Have you noticed that most lawyer advertising is the same? Every bankruptcy lawyer brags about being the best, the toughest, the most aggressive. We all know they are just making it up.
Cheap Bankruptcy Attorneys are a Dime a Dozen
Lately I have seen there are a lot of lawyers bragging about being the cheapest. Search on Google for a mesa bankruptcy lawyer and you will see “Cheap Bankruptcy Lawyer,” “Cheapest Bankruptcy Attorney,” “Low Fee Bankruptcy Lawyer.” Any day now someone will claim to be the “Cheapest of the Cheap.” Are they really?
We all know that cheap and good don’t go together. If we buy a cheap used car we know it will cost us. We will pay a price with high repair and maintenance costs. When we go to a fast food restaurant we pay for convenience, not quality. If we eat too much of it the medical bills will more than wipe the savings.
Those aren’t surprises. We expect it and decide knowing what will happen. When it comes to hiring a lawyer I don’t believe many people decide knowing the risks.
Hidden Cost of Low Cost Bankruptcy Lawyer
A lot of my clients have visited other lawyers before coming to see me. Most of the times they have gotten good advice. There are a lot of good choices for finding a lawyer. These clients are smart and just want another opinion before making a big decision. That is not always the case.
Recently a small business owner came to discuss filing a bankruptcy. The economy over the last few years has been brutal. Although he had already hired another attorney his gut told him something was wrong. He was advised to file a Chapter 7 bankruptcy and was about ready to take that advice.
I reviewed his situation and recommended filing a Chapter 13 case instead. Compared to the Chapter 7 case he was about to file, the Chapter 13 will eliminate over $50,000.00 in additional debt. He can keep his business and other valuable personal property –things he would have lost had he filed the Chapter 7 case recommended by the “cheap” lawyer. In Chapter 13 his monthly “out go” will be less. The discount lawyer would have saved him about $1,500 in legal fees and he would not have realized how much better his situation could have been by spending a little more.
Discount Bankruptcy Cost Way Too Much
Another situation is even sadder. A gentleman filed a Chapter 7 case with one lawyer that claims to be one of the “cheapests” and bragged about it on their TV ads. He was told his case was straightforward and there was nothing to worry about. He owned a life insurance policy with some cash value and an annuity. If you look at any summary of the property protected in a Chapter 7 case you will see that cash value in a life insurance policy and annuities are protected. But, if you read the actual law you would see that not all insurance policies and annuities qualify for the protection. Apparently the cheap lawyer had not read the statutes. This gentleman lost over $40,000 in assets that could have been protected with some proactive planning. Well, he saved about $1,000 in legal fees but lost $40,000 because he did not know how risky hiring a cheap lawyer could be.
Low Fee Bankruptcy Unnecessary
As sad as those situations are, a far more common problem is when the discount lawyer is recommending a bankruptcy when it is unnecessary.
Recently a man came to visit me about filing bankruptcy because a collection lawyer was threatening to sue him for over $200,000. Both of the previous lawyers he met with recommended filing a Chapter 7 bankruptcy. A co-worker recommended he talk before deciding. He is glad he did. During our first visit it was clear he had a great defense to the lawsuit, if one was ever filed. It was and the Court dismissed it on my request. Then, we sued the collection law firm for violating the Fair Debt Collections Practice Act. The lawsuit was settled long before trial for a substantial amount (I can’t give you the details because the settlement agreement requires we keep it a secret). Not only did my client avoid the costs and problems of an unnecessary bankruptcy, but he received a substantial settlement, too.
Quality Legal Help Pays
Not everyone with a debt problem must file bankruptcy. But, the cheap lawyers must file a lot of cases to pay for their expensive advertisements. The good lawyers will give you honest advice and search for the best solution for your problem even when it means you won’t be hiring them. I can list example after example of situations where the cheap legal advice cost many times more than the savings in legal fees.
Money is tight when considering bankruptcy. If you are tempted to find the lowest cost bankruptcy lawyer consider the risks. I am convinced that
paying a little more in legal fees will be a much better deal and far less expensive in the long run.
Original article: Are Cheap Bankruptcy Lawyers Too Expensive?©2014 Arizona Bankruptcy Lawyer. All Rights Reserved.
Bankruptcy Means Test If you’re trying to file a chapter 7 bankruptcy, you must first qualify. One of the qualifications is that you must pass the means test. The means test is a mathematical formula designed to prohibit those from filing a chapter 7 bankruptcy if they have the ability to repay a portion of+ Read MoreThe post Making Changes To Pass The Bankruptcy Means Test appeared first on David M. Siegel.
$5,000? $50,000? $500,000? How much debt do you need to have before it makes sense to file bankruptcy?
There is No Magical Amount!
There is no particular debt limit that you must have in order to file a Chapter 7 bankruptcy. It really depends upon what is going on in your life. Life is not simple. Some clients find themselves with good income, but are suddenly single parents with little disposable income. Other clients are living on only social security income and have little debt.
A Little Debt....
I once had a client who have wanted to file a bankruptcy with only $4000 debt. In virtually all situations, this is not enough debt to justify filing bankruptcy. However, a perfect world storm caused this case to be filed. First, income was almost non-existent. Usually, this is not a problem once the creditor realizes the issue and will settle the debt for less than what is owed and what the client can afford to pay. In this case, however, the creditor was stubborn, which made it stupid. It wanted to be paid 100% and continued to proceed with a lawsuit, hoping to obtain a a judgment and a 25% wage garnishment. No amount of persuading the creditor to take less worked.
Or, A lot of Debt ....
I have had other clients who had $400,000 worth of debt and were fighting against filing a Chapter 7 and getting a fresh start.
The Key: Can You Make A Dent in Your Bills if You Attacked It for 6 Months?
You have to determine whether or not you feel you can either pay your debt back over time or whether or not you need a fresh start to be able to survive.
I like the 6 month rule. If you attacked your debt for six months, could you leave a dent? Or, would you hardly leave a dent, instead you are just simply paying minimum payments, primarily paying interest. If you don’t see your debt going down, then bankruptcy is probably a good solution for you to get out of debt once and for all and get back on your feet. If, on the other hand, you feel you have the ability to make a significant dent in the debt, I think you should first try this approach.
Photo Credit: Alan Cleaver at Flickr
When you apply for a student loan, you may be required to get a consigner. That person, usually a relative, is doing a good deed for you in helping you get the loan.
Here are some things you need to know about what it means for you – and for the cosigner.
Cosigner Liability
- The cosigner is 100% liable for repayment of the student loan.
- If you don’t make payments when they are due, the cosigner’s credit report will show the delinquency.
- If the lender sues you for nonpayment, the cosigner will also be sued.
- If the student loan lawsuit goes to judgment, the cosigner may be subjected to wage garnishment, bank account freezes, and a lien on his or her real estate.
Cosigner Release
- Unless the cosigner is released by the lender, liability remains intact.
- An agreement signed by the cosigner and anyone else does not affect liability unless the lender also signs the agreement.
- Each lender has different rules to releasing a cosigner from liability. For example:
- Sallie Mae states that, “[T]o qualify for cosigner release, the borrower must have successfully completed school, made 12 consecutive on-time principal and interest payments for Smart Option Student Loan or Career Training Smart Option Student Loan (other Sallie Mae private loan products may have different minimum on-time principal and interest payment requirements, please contact us for details at 1-888-272-5543), meet age of majority requirements, and meet the underwriting requirements when the request for cosigner release is processed. The borrower’s account must remain current until the request for the cosigner release is processed. The borrower must be a U.S. citizen or permanent resident at the time the cosigner release is processed.”
- Wells Fargo says that, “The student borrower may request that the cosigner be released from the loan after the first 24 consecutive monthly payments are made on time and the student borrower meets certain credit requirements. In the event of the death or total and permanent disability of the student borrower, the loan can be forgiven and the cosigner won’t be responsible for repayment. Please note that the student borrower must be a U.S. citizen to be eligible for cosigner release.”
- Usually, the student must apply for the release.
- You can get the cosigner off your student loan if you refinance or consolidate your student loans with a new lender.
Beware The Dangers Of Student Loan Cosigners
The landscape is difficult for those who cosign for student loans, as well as for those who need someone to help them qualify for financing.
If you understand the risks and how to minimize them, you may find that a cosigner can provide much needed security with a minimum of hassle.
Book Free Initial Consultation
Jordan E. Bublick is a Miami Bankruptcy Lawyer with over 25 years of experience in filing Chapter 13 and Chapter 7 Bankruptcy Cases and Mortgage Modifications (305) 891-4055
The answer to this is no…and yes. In Arizona, wedding rings are exempt up to $2,000. This means that for both you and your spouse, you can exempt a total of $2,000 of the value of your wedding rings. For most people, this is more than enough to keep their rings safe. But what if, during better economic times, you purchased more expensive jewelry? Technically, the Trustee can have you turn over your jewelry. Does this happen often? No. Could it? It could. The post Can the Trustee Really Take My Wedding Rings?! appeared first on Tucson Bankruptcy Attorney.
Bankruptcy Petition Can Be Amended Your bankruptcy petition can be amended after you file. This is often the case when someone forgets to list a particular creditor. The creditor may not have shown up on the credit report or the debtor simply misplaced a bill from that creditor. In a chapter 13 case, the bankruptcy+ Read MoreThe post Can My Bankruptcy Petition Be Amended After Filing? appeared first on David M. Siegel.
I am pleased to announce that I have updated my bankruptcy website! This website is meant to offer better content to clients and potential clients in a clean and crisp format. I am very happy that the website is responsive to viewing on mobile devices as well! Please check it out and let me know what you think!
The website was designed by Rod Silver of Artco.
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Learn more about how Bankruptcy works and what you need to know.