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When you’ve got a judgment against you, collection gets scary. For New Yorkers, there’s some relief.
When people call me for help with their bill problems it’s usually because they’re scared of a judgment.
The fear doesn’t stem from the actual lawsuit from a creditor, but rather the efforts that creditor can take after the lawsuit is completed.
Wage garnishments, bank account freezes and the prospect of being penniless are powerful motivators when it comes to clearing up bill problems.
Luckily, the law’s on your side this time.
New York Exempt Income Protection Act
Once upon a time, a creditor with a judgment against you could lock up your entire bank account as a way of enforcing the judgment. A little known New York law called the Exempt Income Protection Act prevents that from happening.
The Exempt Income Protection Act prevents judgment creditors from taking certain funds in bank accounts to satisfy money judgments. It’s not a cure-all, but it does take some of the heat off you as you plan your next move for getting out of debt.
What’s Protected?
Under the EIPA, the following funds cannot be frozen:
- The first $1,740 in any bank account;
- The first $2,500 in any bank account received within 45 days from the following sources:
- Social Security benefits
- Supplemental security income (SSI)
- Disability benefits
- Child support payments
- Worker’s Compensation benefits
- Veterans Administration benefits
- Railroad Retirement benefits
- Public or private pension payments
- Unemployment benefits
- Public assistance
If your account contains less than the amount you can exempt, then the restraining notice sent by the creditor to the bank is considered void – in other words, the bank gets to rip it up and ignore it.
Beware The Exceptions
Don’t jump for joy yet – the exemptions have exceptions. If the State of New York, or any of its agencies or municipal corporations, is the judgment creditor then all of your funds can be frozen. In addition, if the debt being enforced is for child support, spousal support, maintenance or alimony then the exemption doesn’t apply either.
For that reason, it’s important to take a look at the debt collection lawsuit as well as the judgment carefully.
The EIPA Doesn’t Solve Your Problem
You probably can’t live off the amount of money excepted under the EIPA, so it’s not going to solve the problem of having a judgment against you.
It doesn’t prevent a judgment creditor from taking a portion of your income to pay off the debt.
The interest on the judgment continues to pile up.
And if you’re like most of my clients, this isn’t the only debt you’ve got.
With that in mind, remember that the EIPA is designed to give you some breathing room so you can take stock of your situation and figure out the best course of action to work through your bill problems. For some people, negotiating with the creditor is the right solution. For others, bankruptcy makes sense. And for a very few, allowing the creditor to collect on the judgment through a wage garnishment is going to cause the least financial pain.
Regardless, the EIPA gives you the opportunity to sit down with a lawyer and map out a course of action.
Image credit: rofltosh
Bank Account Frozen? For New Yorkers, There’s Hope. was originally published on Consumer Help Central. If you're seeing this message on another site, it has been stolen and is being used without permission. That's illegal, a violation of copyright, and just plain awful.
By Mary Ann Pekara
In Tampa this afternoon arguments will be heard in the Casey Anthony bankruptcy case as to whether or not Casey Anthony's life story can be considered property or not.
Last month, Stephen Meininger, the bankruptcy trustee handling Anthony's case, filed a motion that essentially said her life story could be used to pay her off her debt.
In the motion, "the Property" included details of Anthony's childhood (which includes allegations of sexual abuse by her father) as well as the disappearance and death of her daughter, Caylee.
Anthony's attorneys disagree on the basis that such a thing would be invading her constitutional rights and "private thoughts." They say the motion "should be denied because the 'property' that the Trustee seeks to sell does not exist."
"By allowing property that can only be created by post-petition labor to be sold as part of the bankruptcy estate, a debtor would never be able to achieve a "fresh start," the filing says. "Perhaps more troubling, the Order sought by the Trustee would result in the judicial invasion and taking of thoughts and memories that have not been memorialized but are contained solely within the debtor's mind. This is a terrifying Orwellian prospect that would destroy the long-standing protections guaranteed by the Bankruptcy Code."
A $10,000 bid was made on the story by James Schober, an attorney in Texas, who wants to prevent the story from ever getting out. This would stop Anthony from ever making a profit on her life story.
Meininger thinks auctioning off Anthony's story to the highest bidder would best maximize the value for those Anthony owes in her bankruptcy filing, listing over $792,000 in debt.
Anthony, 27, has been unemployed and living with friends since she was acquitted of her daughter's death in 2011. She has yet to share her side of the story.
Despite the image and stigma associated with bankruptcy, financial reorganization of failing businesses (and nonprofit organizations) through Chapter 11 bankruptcy is actually helping the economy by giving companies a chance to find new financing, reject onerous contracts, renegotiate leases, and expedite the sale of assets.
Harvard Business School recently published an article reviewing comments made by Stuart C. Gilson, a Harvard business professor and advocate of Chapter 11 bankruptcies in his new book, "Creating Value Through Corporate Restructuring: Case Studies in Bankruptcies, Buyouts, and Breakups." Gilson believes that the first step is getting the public to realize that Chapter 11 is not about "dying companies," but about "reviving" them.
During the financial crisis of 2008, debt restructuring and Chapter 11 played a heroic role in reviving the US economy. Not only does it speed up a company's reorganization process, but it focuses in on what is necessary to "rehabilitate" the company rather than focusing solely on paying back creditors and stakeholders. (US bankruptcy laws differ from other countries in that they strive to restore the companies facing bankruptcy in order to make them viable and competitive rather than simply liquidating them.)
Restoring Chapter 11's Image
Chapter 11 was often seen as slow and expensive, however, it is emerging and evolving in a way that allows "managers and financiers to work with companies facing bankruptcies and deal with them effectively and appropriately."
For example, one of the ways Chapter 11 is evolving is through the use of the "prepackaged bankruptcy." A "prepackaged bankruptcy" combines the traditional notions of a Chapter 11 bankruptcy while incorporating "out-of-court" restructuring. Companies are able to negotiate restructuring plans with creditors to give them assurance that once they file the actual bankruptcy, the creditors all will be on the same page.
Allowing for prepackaged bankruptcies gives companies the flexibility and assurance from creditors that they will "vote for the restructure plan once the firm officially enters into chapter 11." By choosing this path, it allows companies a chance to "avoid the steep costs associated with spending [time] in bankruptcy court."
Another emerging frequent use of Chapter 11 is for a bankrupt company to sell its assets in a competitive auction that is supervised by the courts under Section 363 of the Bankruptcy Code. Companies who utilize this option can expedite the sell-off of their assets free and clear.
In addition to expedited asset sell off, Chapter 11 gives companies other options for generating income. During Chapter 11, the company pays no interest on any "pre-bankruptcy debts," they can "reject unprofitable leases" and "new lenders are given priority in the capital structure" using what is known as "debtor in possession financing" by new lenders gain super priority and stand ahead of pre-existing creditors. This priority encourages banks and other lenders to lend to companies in Chapter 11 rather than discourage it.
Should My Company Seek Advice From a Bankruptcy Attorney?
Chapter 11 is changing and becoming an integral part in saving US companies and the economy. If you feel your company or organization could benefit from filing for Chapter 11 it is advisable to speak with an attorney, and in particular an attorney familiar with bankruptcy practice in Maryland, Virginia and Washington, DC. An attorney will evaluate your company's situation and determine whether you would benefit from reorganizing. Additionally, an attorney will aid you throughout the process as well as assist you through the restructuring process to meet your goals.
Despite the image and stigma associated with bankruptcy, financial reorganization of failing businesses (and nonprofit organizations) through Chapter 11 bankruptcy is actually helping the economy by giving companies a chance to find new financing, reject onerous contracts, renegotiate leases, and expedite the sale of assets.
Harvard Business School recently published an article reviewing comments made by Stuart C. Gilson, a Harvard business professor and advocate of Chapter 11 bankruptcies in his new book, "Creating Value Through Corporate Restructuring: Case Studies in Bankruptcies, Buyouts, and Breakups." Gilson believes that the first step is getting the public to realize that Chapter 11 is not about "dying companies," but about "reviving" them.
During the financial crisis of 2008, debt restructuring and Chapter 11 played a heroic role in reviving the US economy. Not only does it speed up a company's reorganization process, but it focuses in on what is necessary to "rehabilitate" the company rather than focusing solely on paying back creditors and stakeholders. (US bankruptcy laws differ from other countries in that they strive to restore the companies facing bankruptcy in order to make them viable and competitive rather than simply liquidating them.)
Restoring Chapter 11's Image
Chapter 11 was often seen as slow and expensive, however, it is emerging and evolving in a way that allows "managers and financiers to work with companies facing bankruptcies and deal with them effectively and appropriately."
For example, one of the ways Chapter 11 is evolving is through the use of the "prepackaged bankruptcy." A "prepackaged bankruptcy" combines the traditional notions of a Chapter 11 bankruptcy while incorporating "out-of-court" restructuring. Companies are able to negotiate restructuring plans with creditors to give them assurance that once they file the actual bankruptcy, the creditors all will be on the same page.
Allowing for prepackaged bankruptcies gives companies the flexibility and assurance from creditors that they will "vote for the restructure plan once the firm officially enters into chapter 11." By choosing this path, it allows companies a chance to "avoid the steep costs associated with spending [time] in bankruptcy court."
Another emerging frequent use of Chapter 11 is for a bankrupt company to sell its assets in a competitive auction that is supervised by the courts under Section 363 of the Bankruptcy Code. Companies who utilize this option can expedite the sell-off of their assets free and clear.
In addition to expedited asset sell off, Chapter 11 gives companies other options for generating income. During Chapter 11, the company pays no interest on any "pre-bankruptcy debts," they can "reject unprofitable leases" and "new lenders are given priority in the capital structure" using what is known as "debtor in possession financing" by new lenders gain super priority and stand ahead of pre-existing creditors. This priority encourages banks and other lenders to lend to companies in Chapter 11 rather than discourage it.
Should My Company Seek Advice From a Bankruptcy Attorney?
Chapter 11 is changing and becoming an integral part in saving US companies and the economy. If you feel your company or organization could benefit from filing for Chapter 11 it is advisable to speak with an attorney, and in particular an attorney familiar with bankruptcy practice in Maryland, Virginia and Washington, DC. An attorney will evaluate your company's situation and determine whether you would benefit from reorganizing. Additionally, an attorney will aid you throughout the process as well as assist you through the restructuring process to meet your goals.
Georgia foreclosure law allows lenders to start and complete the mortgage foreclosure process in as little as 37 days. This means that just over a month from the start date of the foreclosure, you may lose all title interest in your home.With very limited exception, lenders in Georgia do not have to go to court to foreclose on your home. Georgia law permits non-judicial foreclosure, which means that if you go into default, the mortgage company or bank needs only to send you a written notice of intent to foreclosure, then advertise the pending sale for four (4) weeks in the legal newspaper for the county where the property is located.By contrast, other states like Florida, Illinois and Ohio use a judicial foreclosure procedure where the lender must file a lawsuit against you, win a judgment allowing for a foreclosure then conduct the sale. In these other states, a title transfer might not happen for 8 months to a year.Foreclosure sales in Georgia are conducted on the courthouse steps of the county where the property is located. These sales occur only on the first Tuesday of each calendar month and consist of live auctions conducted by mortgage company lawyers.In many cases, the foreclosing back “buys” the property at the courthouse steps sale. Any buyer would have to pay off any first mortgage so an investor would not be interested in a property where there is no equity. Since property values have fallen in Georgia over the past few years many sales result in the bank or mortgage company taking title back.So, let’s assume that today is Wednesday and your house was sold on the courthouse steps yesterday (foreclosure Tuesday). What happens?Usually, nothing happens, at least right away. Under Georgia law, you have lost your title interest in your property and now you are considered a tenant at sufferance. As long as you do not abandon the property, the new owner cannot use self help to take possession of the property.If the new owner was to forcibly change the locks, or worse, dispose of your property, you might have a claim for damages against the new owner.Usually, the new owner will contact you within a few days of the foreclosure sale to request that you move. Some owners will offer “cash for keys” – usually a few hundred dollars to move and avoid an eviction.Other owners will file an eviction, which is a type of lawsuit that seeks a court order terminating any leasehold rights. If you ignore the eviction or if you go to court and lose, the judge will issue an order of eviction and within a few days, the sheriff’s office will show up at your home and physically remove you and your possessions, putting your stuff on the street.I have seen a few cases where a homeowner answers the eviction proceeding by asserting a counterclaim that arises from a wrongful foreclosure claim. A foreclosure may be wrongful if the lender did not give you proper notice, or if the lender did not properly credit you with payments. Wrongful foreclosure actions can take months or even years to work their way through the court system – in this type of situation, the lender will most likely ask the court to require you to pay a monthly sum into the court registry as rent.My good friend and real estate expert Marc Oppenheimer recently testified as an expert witness in a case where a foreclosed homeowner is challenging the foreclosure but has not been paying rent. The judge in the eviction proceeding accepted Marc’s testimony about what constitute reasonable rent for this particular home and the now former owner was ordered to pay monthly “rent” into the court registry while the wrongful foreclosure action proceeds in Superior Court.Bankruptcy can stop the eviction proceeding – sometimes permanently and sometimes temporarily – we’ll discuss that in a future post.Often, foreclosed homeowners can strike deals with foreclosing lenders whereby the homeowner has time to leave, cash to cover expenses and certainty as to what will happen. If you are facing foreclosure, please call my office to discuss your options and the steps you can take to make the best of a bad situation.The post Home Foreclosed? Here’s What Happens Next appeared first on theBKBlog.
Myra Holmes, 55, was recently convicted by a federal jury of one count of bankruptcy fraud, one count of bank fraud and three counts of making a false statement to a bank. There were two other false statement accounts Holmes was acquitted on after a recent 3-week court trial. Her conviction includes taking more than [...]
The worst thing you can do for your credit is to allow inaccurate or out of date information to remain on your credit report. By simply checking your credit report, you can stay apprised of all suspicious action.
Remaining on top of your credit is the best way to avoid having to repair your credit. For example, as discussed in one recent helpful article, the best way to find errors are to check your credit report regularly. The story breaks down the five most common credit reporting errors that you need to look out for:
- Identification that does not belong to you.
- Accounts that don’t belong to you.
- Incorrect payment status.
- Public records that are not yours.
- Inquiries for credit you never applied for.
- Identification that does not belong to you.
The most common of these mistakes are due to variations in name spelling, wrong social security numbers, or entry mistakes. This can be a sign of identity theft. Staying on top of your credit report and in contact with the credit reporting agency can help you correct the mistakes before any damage is done to your credit.
Accounts That Don’t Belong to You
The worst feeling is seeing an account that says was opened in your name and with your social security number, yet you never opened an account. In this instance, it is most likely a sign of fraud that requires your immediate attention.
Incorrect Payment Status
If you see that one of your accounts reported you were delinquent or making late payments and you can show that they are mistaken, it is crucial that you contact the credit reporting agency immediately. Late payments can hurt your credit score more than people realize, so staying on top of your report is necessary.
Public Records That are Not Yours
The most common thing to look out for is civil judgments, tax liens, or bankruptcies that are not yours. Credit is affected from these public records, so it is crucial that you keep these off of your credit report.
Inquiries For credit that You Never Sought
Every time you apply for an account, or look to secure a line of credit, inquiries are made into your accounts. If there are inquiries that you did not authorize or do not recognize, fraud is likely involved. It is suggested at this point that you contact an attorney or contact the credit reporting agency.
How Can an Attorney Help Me?
Attorneys are well equipped to help dispute errors on credit reports. More importantly, the best attorneys are honest with you, and suggest that you write your own credit dispute letter before you go spending thousands of dollars paying a “credit-fixing” attorney.
We have a complete guide to credit repair and suggest that you review it and follow the steps set forth there before seeking help from an attorney.
Attorneys are well versed and are aware of the most of the common credit reporting mistakes. You can contact them and show them your credit report with your concerns. They will help you along the way, whether it is disputing a report or simply understanding anomalies. Not only can they help you negotiate settlements on outstanding debts, but they can counsel you on improving your credit. Consider contacting an attorney if you need help or need assistance with any information that is either incomplete or inaccurate.
The post Why Should I Check My Credit Report? appeared first on AKB.
Joint Debtor and Co-Debtor sounds like the same thing or same debtor, but they have distinct meanings in bankruptcy. A person who owes money along with you on a given obligation is your joint debtor; whereas, a person who files bankruptcy with you is your co-debtor. For example, a parent who co-signs a student loan for you is your joint debtor. Your wife who files bankruptcy with you is your co-debtor.
You can be a co-debtor without being a joint debtor on anything.
The original post is titled Joint Debtor or Co-Debtor? , and it came from Oregon Bankruptcy Lawyer | Portland, Salem, and Vancouver, Wa .
In Oregon, the Confirmation Order signed by the Bankruptcy Judge approving your Chapter 13 Plan, specifies that you should not incur any credit obligations during the life of your plan without the Trustee’s written consent. The only times you can buy on credit without the Trustee’s written approval would be in an emergency(as you can imagine this is interpreted pretty narrowly) and in the case of ordinary expenses for a business approved in your plan.
Any request for credit must be approved by the Trustee in writing before you obligate yourself in any way. The most common credit obligation you may wish to incur is for the purchase of a car. Be sure to contact your attorney if you must buy a car or trade in your old one. Do not let a car dealer talk you into anything before your attorney has had a chance to get involved. The Trusteeconsistently approves requests to finance replacement or basic needs vehicles, so long as you and your attorney follow the proper procedure. The procedure simply calls for you to get the Trustee some pretty basic information on a form provided by your attorney and that obtainTrustee approval you commit to any car loan.
If you have any questions at all regarding how you can go about incurring credit during your Chapter 13 Bankruptcy, please feel free to contact Northwest Debt Relief anytime and ask for Tom McAvity so that we can go over your situation.
The original post is titled Can I Take Out Credit While I My Oregon Chapter 13 Bankruptcy is Pending? , and it came from Oregon Bankruptcy Lawyer | Portland, Salem, and Vancouver, Wa .
Our managing attorney, Christopher Jones, just received board certification as a Consumer Bankruptcy Specialist. This is a demanding process that he completed with the American Board of Certification (ABC) over the past three years. ABC is a non-profit organization dedicated to serving the public and improving the quality of the bankruptcy bar. The rigorous certification [...]The post Attorney Chris Jones Joins Ranks as Board Certified Bankruptcy Specialist appeared first on Acclaim Legal Services, PLLC.
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.