Category Archives: Bankruptcy

How a Chapter 13 Bankruptcy Will Affect Your Property

One of the provisions in Chapter 13 of the bankruptcy code allows a bankruptcy filer to cure a debt by surrendering property. And right now many filer are more than willing to part with their property due to declining house values, making Chapter 13 only second to Chapter 7 in the number of bankruptcy filings nationwide.

 

If you have filed for a Chapter 13 bankruptcy and decided you no longer want your home, you had better make sure the property transfer or foreclosure happens quickly, otherwise you will run into some problems.

 

Just because you’ve moved out you think your problems are over? Think again.

 

You are still responsible for vacant property – So you have filed for bankruptcy, moved out and notified the mortgage holder you are surrendering your property. Guess what? Until the title is transferred the property is still technically titled in your name.

 

Until then you can still be held responsible for those pesky homeowners or condominium association fees, any fines imposed by the city or town it is located in for failure to maintain the property and even any damage claims as a result of injuries or accidents that occur on the property.

 

If your bank is taking forever on your foreclosure, those pesky fines, fees and damages will just accumulate and put you in debt all over again. While it is true that the lender does have responsibilities for vacant property and some cities and towns have ordinances requiring banks to check up on and maintain foreclosed properties, it is not the same all over the US.

 

Transferring property to the bank through via Chapter 13

 

This is a problem you want to nip in the bud. There are some things you can do to make sure it doesn’t happen.

 

  • You can include the surrender and transfer of ownership in the property to the lender in the terms of your Chapter 13 plan. You have to state that the ownership of the property will become legally effective in the bank at plan confirmation.

 

  • Try to get the court to go along with this and include appropriate transfer language in the confirmation order so that no deed will be necessary.

 

  • Record the court order in the official property records office of the area where the property is; don’t forget to include the legal description of the property and the name of the bank, just to hit it on the head that that is the right house.

 

Admittedly, this is still not a generally accepted method and some courts may allow it while others don’t.

 

Other options for getting rid of your property

 

If even with a Chapter 13 plan the bank still won’t take back the property then there are others things you can do to get rid of it.

 

For one you can negotiate a deed in lieu, short sale, or consent judgment of foreclosure. You can also lease the property and use the rent for maintenance, insurance, and city or homeowner’s fees.

 

You can also transfer the property by quitclaim deed, but remember that deeds should be recorded in the official property records. This must also be prepared and executed in the form required by the state, and most of all, this must be accepted by the new owner.

How to be Ready for a Bankruptcy Meeting

If you have opted to file for a Chapter 7 or a Chapter 13 bankruptcy, a meeting between you and the creditors (also called a 341 meeting) will be scheduled at least 21 days after you file your case but no later than 40 days after you file for bankruptcy.

 

The true purpose of a 341 meeting is to make sure you have fairly and honestly represented your assets, income and debts in your bankruptcy petition. As part of his or her job, the trustee will also try to determine any bankruptcy fraud and make sure your paperwork is accurate.

 

For a bit of trivia the name 341 comes from the section of the bankruptcy code that requires such a meeting. So, yes, it is provided for by law.

 

What you should know about the meeting

 

It doesn’t take place in a courtroom – the meeting is usually arranged in a regular room in the bankruptcy court.

 

There are usually few people in attendance – There will be no judge, by law judges are not allowed to attend 341 meetings, your Chapter 7 trustee will be there since he or she will be the one to conduct the meeting.

 

Your lawyer will be there to represent you, but you also have to be there.

 

Creditors will be formally invited to the meeting, but they usually neither attend nor send representatives. In the rare instances they will, it is usually to inquire about the whereabouts or condition of mortgaged property or anything covered by a secured loan.

 

Again it is important that you not miss this meeting; at best it will be rescheduled, at worst this may result in the dismissal of your case and you will have to re-file and pay the court filing fees again.

 

What to provide before the meeting

 

Prior to the meeting, you are required to send your trustee certain documents like tax returns, paystubs and mortgage statements so he or she can check them against the information in your bankruptcy petition. You might also be asked for a copy of your most recent federal tax return at least seven days prior to your meeting of creditors.

 

As to the meeting itself, you will be asked to present any photo ID and any ID with your Social Security number or any government document with the same for proper identification.

 

What questions will be asked during the meeting?

 

As it is the job of the trustee to make sure everything in your petition is in order, he or she might ask you:

 

  • Why you filed for bankruptcy
  • If you have sold or given away any property in the past few years
  • If your monthly expenses are necessary and reasonable
  • If you have reviewed your petition before it was filed
  • If you have listed all your assets and debts
  • If there has been any improvement in your finances since the filing

 

Meetings are rescheduled for any number of reasons, but usually to provide more information to the trustee, submit more required documents or amend some entries in your petition.

 

In all, the meeting should not last longer than 15 minutes. After that you will have just taken what is considered the first step in order to get your debts discharged.

Ways to Increase Your Credit Score After Bankruptcy

 

Don’t think of bankruptcy as the end of your “financial trustworthiness”. Even if you have filed for protection from your creditors and reached some form of agreement regarding your debts there are still some things you can do to save and even improve your credit rating.

 

Just remember that this is something you have to take seriously. A bankruptcy can remain reflected in your credit report for up to 10 years and your credit score will stay low until you have started building up your credit again.

 

So what should you do?

 

Do not close your accounts

 

Yes, it was your account that led to temptation and spending in the first place, but it would be a bad idea to throw the baby out with the bathwater, if you get the drift. Closing your accounts will only raise red flags with the company and make them think that you are no longer interested in settling your obligations or even that you’re preparing to make a run for it. Closing accounts will also reduce the amount of credit you have available to you.

 

Apply for a secured credit card

 

Get a card that will allow you to put as high a deposit as possible. You might think this is a bad idea, but if you have such a card the disposable balance the credit card will report to the credit bureaus will be equal your deposit and that will do good for your score. Just remember to buy little with that card at first, never get carried away. It also helps to pay off the small balance each month. Paying this will eventually get rid of the initial credit increase.

 

Pay your bills on time

 

Your payment history makes up roughly 35 percent of your credit score so one of the best ways to get your score up again is to make sure you always your bills on time. If it was bad memory that made you always late for payments, take drastic measures to make sure you know when the due date is. Go as far as to mark due dates on your calendar or PDA. You can also set up alerts with any handheld mobile device you always have with you. Many banks and creditors also offer services that allow you to set up your payments electronically, take advantage of this feature.

 

Constantly monitor your credit report

 

You can request yearly copies of your credit report, but better if you go over them every six months. Check the report and make sure all items that have been discharged in the bankruptcy are no longer there. Also keep any eye out for mistakes or inconsistencies.

 

If you see something that has to be disputed you should do this over certified mail as opposed to phone call, email or the company’s online service. Letters have to be encoded manually by a processor and this may help guarantee that your case gets to where it should.

 

Get a loan

 

Try not to do this until after a year or two after the bankruptcy. Whether it’s for a car, a house, education or anything else, also be sure that it is affordable so you can pay it off. Keep a lookout for loans with the lowest interest rates. Remember that once your credit score improves, any loan you get in the future may likely have a lower interest rate.

The Good and Bad of Filing a Chapter 20 bankruptcy

There is actually no Chapter 20 in the bankruptcy code, the Chapter 20 is the term used when someone files for a Chapter 13 bankruptcy just after getting a Chapter 7 discharge. This is done when the person filing bankruptcy, or his lawyer, feels either chapter is inadequate to provide relief to the filer.

 

First let’s see in a nutshell what each chapter provides.

 

Chapter 7 – This provides for a quick discharge of a bankruptcy filer’s debts, but also requires the filer to pay a lump sum to creditors to be able to keep secured property like a home or a vehicle, roughly equivalent to the item’s replacement value or reaffirm the debt and go on making payments as if a bankruptcy never occurred.

 

Dischargeable debts include credit card debt, mortgages, medical bills, vehicle loans, personal loans and even tax debts.

 

Chapter 13 – This allows a filer to pay a non-dischargeable debt or settle a delinquent mortgage or car loan by way of a payment plan that usually lasts several years.

 

Why people file for a Chapter 20

 

A Chapter 20 strategy allows consumers to be eligible for Chapter 13 relief if they cannot file for Chapter 13 directly because they do not fulfill some of the requirements.

 

Pros of a Chapter 20 strategy

 

It buys time. The most common reason for filing Chapter 20 is when people need more time to settle a delinquent mortgage or car loan. If your overall debt exceeds the limits specified under Chapter 13, you can file for Chapter 7 first, so when you subsequently file for Chapter 13, you will get more time to settle the debts or to pay non-dischargeable debts under Chapter 7.

 

A Chapter 20 filing can also protect your home while allowing you to pay off debts, specifically when people have a second or even third mortgage on their home. When a homeowner owes more on the first mortgage than the home is actually worth, Chapter 13 will let the second mortgage be removed to become an unsecured debt.

 

Cons of a Chapter 20 strategy

 

You have to be careful in proceeding with a Chapter 20 bankruptcy. Under law you cannot file for a Chapter 13 discharge four years after you have filed for a Chapter 20.

 

Some jurisdictions and judges also do not favor granting this type of bankruptcy, seeing it as a loophole already overexploited by opportunists; others cite the possible lack of good faith on the part of the debtor when it comes to this move.

 

Another known disadvantage to going for a Chapter 20 is that some states require the petitioner to first pass a Means Test. For example the in Colorado Bankruptcy Court the household size, income and expenses of the family of the filer has for to be examined six months before filing. So this has to have ample preparation. A debtor who does not pass the Means Test will be required to file chapter 13 directly, if eligible.

 

The strategy itself can also be used against a filer if a secured creditor can prove that the multiple filings were intended to hinder, delay or defraud them.

Rise in Physician Bankruptcies

Why are doctors being driven to bankruptcy is a question that many physicians and patients are asking and concerned about. Indiana bankruptcy attorneys have seen an increase in the number of physicians coming to them for help. If you one of those hardworking physicians worried about money and having to file bankruptcy, you are not alone. The trend has been accelerating in recent years with many practices shutting down.  Physician bankruptcy not only affects practices of many doctors, it also affects patients who end up with less choices of getting nearby healthcare.

 

Factors Contributing to Recent Physician Bankruptcy Trends 

While you may think that malpractice filings are behind physician bankruptcy filings, you would be wrong. A combination of other factors can be attributed to the recent rise in bankruptcy among physicians. The weak economy has caused patients to cut back in doctor visits. Insurance companies and Medicare cutbacks have reduced reimbursements physicians receive. Medical malpractice costs have gone sky high with many specialty physicians such as OB-GYN’s having to self-insure in order to make ends meet. High prescription drug costs and business operating expenses and incremental changes in Obamacare have added to doctor’s woes making it more difficult to keep afloat.

 

Options to Help Physicians Get Out of Debt

There are alternatives if you seek help right away. By talking to an experienced Indiana bankruptcy attorney, you may be able save your practice and keep your doors open.

Physicians who are struggling may be able to keep their business assets and their practices by restructuring their debt and filing for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. Filing for bankruptcy protection prevents your creditors from suing you and obtaining judgments against you.

 

Benefits of Chapter 11

Chapter 11 allows you to reorganize your business by reducing your debt with your creditors by agreeing to enter into a court-approved reorganization plan over a three to five year period. The good thing about Chapter 11 is it gives you time to come up with an effective business plan and reduce your debt at the same time. After you complete the plan, any unsecured business debts you may have are discharged by the Court. If you are looking for a second chance keep your practice and service your patients, Chapter 11 may be the right answer for you.

 

Indiana Bankruptcy Lawyers Assistance

If you are a physician facing financial difficulties, our Indiana bankruptcy lawyers at Walton Legal Services can help you sort out the best options for your business to get you out of debt. Whether you decide Chapter 11 bankruptcy is the right option for you or not, it is recommended that you speak with an Indiana bankruptcy attorney right away before you lose your practice and have to shut your doors.

 

Sources: http://www.naturalnews.com/040416_medical_bankruptcy_obamacare_doctors.html#ixzz2nYKDmhttp://money.cnn.com/2013/04/08/smallbusiness/doctors-bankruptcy/index.htmllg6

Listing Your Bankruptcy Debts

When you file for bankruptcy, you must list all your outstanding debts on the bankruptcy petition as well as your assets. Debts include secured accounts such as home mortgages and car loans and unsecured debts such as credit cards, department store accounts, medical and dental bills, cell phone and other bills.

 

You cannot select which debts will be discharged under bankruptcy. The decision to keep your accounts open or to close them is up to your creditor. Your bankruptcy attorney has no authority to make these kinds of decisions either. Your bankruptcy attorney can negotiate with your creditors to try to get them to keep your account open if our can show that you are able to make the payments on time, but there is no guarantee that they will agree to do so. Also, keeping accounts open may depend on what type of bankruptcy you file.

 

Under Chapter 7, your unsecured credit card debts are generally discharged. Secured debt such as a home mortgage or debt secured by other collateral may be kept if your creditor agrees. Under Chapter 11, your debt is restructured. Any remaining unsecured debt is generally discharged after you complete your court-approved reorganization plan over a 3-5 year period.

 

Reasons Why you May Want to Keep Your Credit Card or Other Account

There are reasons why you may want to keep an account open such as the need for a credit card to travel or for an emergency. You may want to keep your department store charge open or other account if you have maintained a good credit history with a particular creditor. There may be a joint account or co-signer involved.

 

If you have a car loan or a home mortgage, you probably are going to want to keep your car and home if you can afford the payments. It is possible for you and your Indiana bankruptcy to negotiate a resolution to the debt so you may be able to keep both accounts. However, if at any time you default on your payment, the creditor can attempt to collect the debt against you after the bankruptcy discharge. This means that your lender could start foreclosure proceedings against you to foreclose on your home or your car finance company could repossess your vehicle.

 

Walton Legal Services: Indiana Bankruptcy Attorneys

A good Indiana bankruptcy attorney can explain how you can resolve your credit card debt issues and assist you with bankruptcy filing.  The attorney can answer any questions you may have regarding the bankruptcy proceedings and which debts you may be able to retain. Keep in mind that after your bankruptcy is discharged, you may be able to re-establish your credit by obtaining a secured credit card or getting a co-signer. Also, your credit will improve over time.

 

For questions about bankruptcy filing and listing your credit card and other debts, it is recommended that you speak with an Indian bankruptcy attorney.

When to File Chapter 7 or Chapter 11 for Your Business

If your business is having financial problems, you may want to consider filing for bankruptcy protection. If your business is a sole proprietorship or partnership, your personal liability is higher than if your company is a corporation. In a sole propetorship, you are considered responsible for 100% of the debts of your company. Creditors could go after your personal assets. While in a partnership, you and your partner are each responsible for your respective proportion of debts, you could also be responsible for 100% of the debts, if your partner does not have enough assets to cover your partner’s share of the debt.

 

If your business is a corporation, corporations are considered separate entries so you are not personally liable for your company’s debts unless you personally guarantee your company’s business loan or collateral securing the loan. Keep in mind also that your initial investment and that of your other shareholders in the company are at risk when your business files for bankruptcy. Similar to a corporation, if your company is a LLC, you may be personally liable if you guarantee a loan or collateral securing a loan

 

Chapter 7

 

Chapter 7 bankruptcy protection is used when a company no longer wants to stay in business. The company’s assets, including business equipment, are sold to pay off creditors. Chapter 7 relieves your business’s contractual obligations under a lease and gets rid of your business debts.

 

Chapter 11

 

Chapter 11 bankruptcy protection is used for businesses that wish to continue conducting their business and keep all their assets. Under Chapter 11, your business agrees to enter into a reduced debt reorganization plan with creditors, subject to the Bankruptcy Court’s approval. Basically a Chapter 11 is a reorganization and restructuring of your business. Under the reorganization plan, your company agrees to pay off its debt to its creditors over a 3-5 year period. After the plan has been completed, the bankruptcy is discharged.

 

Indiana Bankruptcy Attorney

 

Filing for business bankruptcy is complex. Before you decide to file for bankruptcy of your business, you should discuss the decision with an experienced Indiana bankruptcy attorney. An Indiana bankruptcy attorney can sit down with you and help you choose the best option for your business and your financial situation.  The attorney will be able to file the Petition of bankruptcy on your behalf, attend court hearings and negotiate the reorganization plan with your company’s creditors.

How to Handle Mistakes on Your Credit Reports

Handling Credit Mistakes and Billing and Electronic Errors    

A recent government study reflects that there are approximately 40 million Americans with mistakes on their credit reports. Just about every time you use your credit cards, take out a home mortgage, car loan, or student loan or obtain other financing, your payment history is reported by your creditor to one or more of the three major credit reporting bureaus in the United States- Experian, TransUnion and Equifax. These credit agencies compile files about your credit history and the amount of due you owe and provide that information to new or existing creditors. Your creditors make decisions about your credit worthiness and whether to give or deny your credit depending on your credit score.

Having mistakes and errors on your credit report, can result in you having to pay higher interest rates or being denying credit altogether.  Even if you know that you have a perfect or near perfect credit history of paying your bills on time, it can be a long and frustrating process to get the credit bureaus to correct or remove the mistakes.

 

What You Can Do to Protect Yourself?

As a consumer, you have certain rights regarding the reporting of your credit. For instance, if you are denied credit, the creditor must advise you in writing the reason for the denial. You can obtain a copy of your credit report for free if you have been denied credit within the last 90 days by writing to the credit reporting agency listed in the creditor’s denial letter or by obtaining your annual free report from annualcreditreport.com (https://www.annualcreditreport.com).

Upon reviewing your credit report, if you discover any errors or mistakes, then under the Fair Credit Reporting Act (FCRA), you have the right to dispute the information by making a written request to the major credit bureaus or going to their websites and completing an online dispute request. The credit reporting agencies must contact the creditor. If your creditor fails to respond in 30 days, then the reporting agency by law must remove the information forever from your report.  Consumers frequently complain about the frustrations of getting the information corrected or removed and sometimes require the assistance of an Indiana credit counseling attorney to help them in their efforts.

Credit Card Billing Error Protections

On the other hand, if you find credit card billing errors on your monthly statement, under the Fair Credit Billing Act (FCBA) and Electronic Fund Transfer Act (EFTA), you also have the right to resolve those mistakes and request that your bank, credit card company or finance company correct the problem. This includes crediting funds to your account for billing errors or funds taken out electronically without your permission, overdraft fees, finance charges, installment loan fees or ATM withdrawals or deposits. However, the law excludes transactions relating to home or car loans.

 

Assistance from an Indiana Bankruptcy and Debt Counseling Attorney

If you are still having trouble getting the credit reporting agency or your creditor to remove a mistake or error or credit your account for billing, electronic funds transfers or ATM errors, then you may want to contact an Indiana Bankruptcy or debt counseling attorney to assist you with getting the items corrected or removed. If for some extreme or unusual circumstances, you find it necessary to file a lawsuit against a consumer credit reporting agency for violating the FCRA laws or your creditor for violating other credit, billing and electronic funds laws, the Bankruptcy Lawyer can handle the lawsuit and represent you in connection with any settlement negotiations regarding the matter.

Source:

http://www.cbsnews.com/8301-18560_162-57567957/40-million-mistakes-is-your-credit-report-accurate/

 

What You Need to Know About Indiana Bankruptcy Judgments and Credit Reports

The Indiana statute of limitations governs the maximum amount of time that a party has in order to sue someone for a debt. The statute of limitations for oral contracts and written contracts concerning the payment of money and promissory notes is 6 years from the time the debt incurred and 10 years for all other contracts which are not related to money matters. If the debtor makes a promise to pay or makes a payment, then the statute can start running all over again.
A debt collection company or debt collector also has the right to extend the time in which it can collect a debt from a debtor/consumer by filing a lawsuit and obtaining a judgment. The statute of limitations in Indiana for a judgment is 10 years, unless otherwise renewed by the debt collector. This means that the judgment stays on your credit history for 10 years and the creditor has 10 years in which to collection that judgment against you. The creditor can go to court after the 10 year period and ask for a request to renew the judgment against you for an additional 10 years.

 

Creditor’s Rights
Under the Fair Debt Collections Practice Act, you have the right to dispute the debt. The debtor must give you 30 days time in which to dispute a debt before filing a lawsuit. If they fail to do so, you can ask the court to dismiss the lawsuit. You can also dispute the debt with the three major creditor bureaus, and ask them to remove it from your credit history. They must automatically do so if your creditor fails to respond within 30 days from receipt of the dispute notice and your creditor cannot report the debt again. However, this does not relieve you from paying the debt unless it has expired under the statute of limitations.
If the debt has expired, you can also ask the court to dismiss the lawsuit. There is no reason for you to pay an expired debt. However, if you fail to show up in court, the creditor can obtain a judgment against you. A creditor can enforce a judgment against you by garnishing your wages or bank account or filing a lien against property you own. Once a judgment has been entered against you, it is much more difficult to have it removed. It can also damage your credit by lowering your credit score. So it is best not to ignore the lawsuit and to try and fight it with the help of an Indiana debt counseling attorney.
Hiring an Indiana Bankruptcy Attorney  
Our Indianapolis Indiana Bankruptcy Lawyers at Walton Legal Services will guide you safely through Bankruptcy proceedings.  We have over 30 years of experience and know exactly how to get you relief from the burden of too much debt.  Call our Bankruptcy Attorneys at 317-897-3262 today.

Steps to Take When You are Unable to Pay a Debt or it Goes to Collection 10.13

Circumstances such as a job loss or other financial hardship may arise causing you to default on your debt. When this situation occurs, there are some steps you can take to avoid a debt from going to collection in the first place such as calling, emailing or writing to the creditor and making payment arrangements. The creditor may be able to allow you to skip a full payment or two and just pay the interest or make a partial payment and then catch up later, lower the interest or re-adjust your payments making them more affordable for you.  It does not hurt to ask. If they won’t work with you, then you should speak with an Indiana credit counseling attorney for legal assistance.

 

Collection Practices 

A debt typically goes to collection after you fail to pay the creditor within 60 to 90 days after the initial due date. Once the debt has gone to collection, under the Fair Debt Collections Practices Act, the creditor must send you written notice of the attempt to collect the debt. You then have 30 days to respond from the time you receive the notice to dispute the debt, pay or settle the debt and request that they remove the debt from your credit. You can also dispute the debt with the three major credit agencies, Equifax, Experience and TransUnion, and they will contact the creditor. If the creditor does not respond to the creditor bureaus within 30 days, then the creditor bureaus must remove the debt from your credit report permanently. However, this does not relieve you of the liability to pay the creditor or collection agency if you owe the debt.

 

What Happens if You Ignore a Collection Notice or Lawsuit Against You?

If you ignore the collection notice, the collection agency can sue you and get a judgment against you if you do not respond to the collection notice within the 30 day time period. Under Indiana law, a creditor can sue you for any oral or written contract concerning the payment of money or a promissory note within 6 years from the time you incurred the debt. If you make a promise to pay, the the statute of limitations starts running from the date of your promise. The collection agency can obtain a default judgment against you if you do not respond to the lawsuit. Or if you lose the case in court and obtain a judgment against you, they can also put a lien on your home or other property or attempt to garnish your wages or bank account to collect the debt.

A judgment can be enforced for 10 years under Indiana law, unless your creditor renews the judgment for an additional 10 years. It is much harder to get judgments removed, and you will need the assistance of an Indiana credit counseling attorney to help you. The attorney may be able to file a motion to vacate the judgment during the statutory time allowed to do so if you can prove you were sued by mistake, or you paid the debt and have a cancelled check or other receipt to reflect the payment was received by the original creditor or collection agency.

 

Indiana Credit Counseling Attorney

An Indiana credit counseling attorney can help you negotiate debt settlement with your creditors or help you fight an attempt to collect a debt against you such as judgments and garnishment orders. The attorney can represent you in court and assist with other debt matters, including filing for bankruptcy if you have a lot of debt and are unable to pay your creditors.