Bankruptcy Can Take A Toll On Your Assetsbut Not Your Firearms
There are several provisions of the Bankruptcy Act, which are in the process of being amended. One of the provisions to the bankruptcy code which has passed the House of Representatives in July 2010, is provision that, if a person files a bankruptcy, the debtor would be allowed to retain their rifles, shotguns, and pistols so long as the items are not worth more than $3,000.00 combined.
In addition, if a person files for bankruptcy and has just one gun, then there is no limit on the value. This bankruptcy provision passed the House of Representatives by a vote of 307 to 113. In addition, the House Democrat who introduced the provision to the Bankruptcy Code stated, according to the Plain Dealer, we must protect the rights guaranteed to us by our founding fathers, no matter what financial circumstances a citizen might face
In the Senate, Senator Patrick Leahy, Democrat of Vermont, introduced a similar measure.
The National Rifle Association has commented on the proposed bankruptcy changes indicating they too think it is reasonable for people who are in a bankruptcy proceeding to have an effective means of protecting themselves.
Qualifying For Chapter 7 Bankruptcy
Not everyone qualifies for a Chapter 7 debt dischargethe order that wipes out debt. However, being unemployed usually makes the bankruptcy process easier .
A debtor must pass an income-qualifying test called the means test. The means test compares your household income against your state’s median income for a similar household. It’s a two-part test, but each part isn’t always required. Here’s what the test entails.
- Comparing your total income to the state median income. You’ll add together the gross income earned by all family members during the full six months immediately preceding your filing date. If the total amount is below the median, you’ll qualify and won’t need to proceed to step two. If it’s above the median, you’ll go to the next step.
- Subtracting allowable expenses from your gross income. This step determines your disposable income by subtracting certain costs from your gross income. For instance, you’ll deduct the amount you actually spend on some things, such as income taxes, mandatory income deductions, and childcare. You’ll be allowed to deduct a certain amount for other expenses, such as food, utilities, and housing costs. If, after completing the calculations, you don’t have sufficient disposable income to make a meaningful monthly payment to your creditors, you’ll pass the means test.
Ohio Chapter 7 Bankruptcy Debtor Can Not Wipe Out Student Loan
Laura Pietras filed her Chapter 7 bankruptcy in Ohio and sought to wipe out student loans which she cosigned for her daughter. In her petition, Debtor listed an expense for two timeshares of $200.00 per month, $600.00 per month for home improvements, $225.00 per month for cellular phones, and $150.00 per month for vip cable packages.
The Court acknowledged that Debtor had health issues which rendered her unable to work. In fact, Debtor was experiencing mental and physical health related issues. Her monthly income was $4,841.00 per month and was based upon several governmental benefits. Her montlhy expenses totaled $4,799.49 which left a very small budget surplus.
In ruling that the Debtor could not discharge her student loans, the Court relied on the decision in Brunner which is a three pronged test to determine whether a student loan may be discharged. In the first prong, the issue is whether a debtor can maintain a minimal standard of living if required to repay a student loan. Here the Court pointed out that payment of $200.00 per month in the two timeshares was not an expense necessary to maintain a minimal standard of living.
As to the Debtors medical condition the Court noted that there had to be a relationship between the medical condition and the inability to repay the student loan. Debtors income was $58,092.00 and the median income for Debtors family size was $51,319.00. Therefore the Court held that Debtor did not meet the second prong of the Brunner case.
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Chapter 7 Bankruptcy Court Rules In Texas Divorce Attorney Fees Are Support
Raymond D. Tepera filed for Chapter 7 bankruptcy in Galveston, Texas. Debtors former wifes attorneys filed a claim for $129,388.24 in attorneys fees relating to the divorce proceeding between Debtor and his former wife.
The divorce decree stated in pertinent part:
To effect an equitable division of the estate of the parties and as a part of the division, the court finds that Tammy Lynetter Tepera has incurred $125,154.43 as attorney fees, expsenses, and costs. IT IS ORDERED that good cause exists to award Kenneth C. Kaye a judgment in the amount of One Hundred Twenty- Five Thousand and 43/100 dollars for attorneys fees, expenses, and costs, with interest at five percent per year compounded annually from the date this Final Decree of Divorce is signed until paid.
In this case Debtor claimed that teh claim was not a domestic support obligation because Kaye is not a spouse, former spouse or child of the debtor, or the parent, legal guardian, or responsible relative of such child. In this case Kaye testified that he represented Debtors former wife regarding a custody dispute and the fees related to a jury trial on the sole issue of child custody.
If you have questions about bankruptcy in Texas or about this particular court decision, you should inquire with a local Texas bankruptcy attorney.
Hawaii Chapter 7 Bankruptcy Dismissed As Abusive
Christopher Dean NG and Sheila Marie NG filed for Chapter 7 bankruptcy in Hawaii on June 30, 2010. The United States Trustee filed a motion to dismiss their Chapter 7 as being abusive. In fact, the Trustee relied upon 11 U.S.C. 707 and 707 in making its motion.
When the bankruptcy case was filed, Debtors listed income of $5,301.09 per month and this income included a retirement income of $1,439.88 from the military. The payroll deductions all reflected a voluntary contribution to a second retirement account of $520.74. Mr. Ng disclosed that he would not be retiring and that he intended to work for about another twenty years. In addition, when the case was filed the petition showed that there was a surplus of about $76.09 each month.
The bankruptcy court denied the Trustees motion based upon 11 U.S.C. 707 but continued the hearing for a ruling on 11 U.S.C. 707. As the Court noted he Court may dismiss a chapter 7 case as abusive if a debtor filed the petition in bad faith or if the totality of circumstances of a debtors financial situation demonstrates abuse. Section 707 provides:
In considering under paragraph 1 whether the granting of relief would be an abuse of of the provisions of this chapter in a case in which the presumption in subparagraph dos not arise or is rebutted, the court shall consider whether the filed the petition in bad faith or the totality of the circumstances of the debtors financial situation demonstrates abuse.
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Chapter 7 Bankruptcy Court In Pennsylvania Wont Approve Reaffirmation Agreement
Barbara Marie Caldwell filed for Chapter 7 bankruptcy protection in Pennsylvania on April 27, 2011. The issue in this Chapter 7 case was whether she should be allowed to reaffirm a mortgage which was primarily held in her daughters name.
The bankruptcy schedules indicated that Debtor would have a net monthly income of $454.65 if she were allowed to reaffirm the mortgage payment of $537.27 per month. As the bankruptcy court noted, pursuant to 11 U.S.C. 524 of the bankruptcy law, a debtor my reaffirm a debt, thereby ensuring that the debtors personal liability for the debt will survive the debtors discharge. However, under 11 U.S.C. Section 524, bankruptcy courts may disapprove a reaffirmation agreement if a presumption of undue hardship arises, and is not successfully rebutted by the debtor to the satisfaction of the court.
At the hearing, Debtors bankruptcy attorney argued that the court should approve the reaffirmation agreement because Debtor was seeking to protect the interest of her daughter who is a co-owner of the property and her daughter makes the payments. However, Debtors bankrupcy lawyer was unable to tell the court was benefit there was to the Debtor by reaffirming the agreement.
If you have questions about Chapter 7 bankruptcy in Pennsylvania you may want to contact a Pennsylvania bankruptcy attorney who can evaluate your specific circumstances.
Minnesota Unemployment Overpayment And Bankruptcy
Sometimes people receive more money from unemployment than they are supposed to get. This can happen in any number of ways, many of which are perfectly innocent.
- You could fill out the unemployment forms wrong, saying that you had more income at your previous job than you thought.
- You could lose your job, apply for unemployment, and start receiving it, but then your previous employer appeals and wins
Unemployment will start paying out the benefits even if the employer appeals the benefits, and will keep paying the benefits until the appeal is resolved.
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Discharging Unemployment Overpayments In Bankruptcy
In bankruptcy generally you can discharge the unemployment overpayments. Unemployment benefits or EDD overpayments are treated like any other debt in bankruptcy. They are not given special protections, even if they are owed to the state. Section 523 of the bankruptcy code lists those debts that are non-dischargeable in bankruptcy. An unemployment overpayment is not a debt that is listed as exempt from discharge. It is subject to discharge in a Chapter 7 and Chapter 13 bankruptcy. Filing for bankruptcy can provide significant relief from the collection efforts of the state. The automatic stay will help stop collection efforts from the state to pay back the unemployment benefits.
Unemployment benefits only pay a portion of the normal wages that individuals received from their previous employment. Unemployment benefits are generally paid based on calculations from your previous earnings. In California unemployment benefits are calculated based on a specific 12-month period. Overpayments in unemployment can result from a number of reason including incorrect calculations, payments issued for period in which the claimant did not qualify for benefits or reporting false information.
Can You Always Discharge Unemployment Overpayments?
The simple answer is no. If you obtained an unemployment or EDD overpayment as a result of fraud, then it may not be subject to discharge in bankruptcy. Section 523 of the bankruptcy code makes the following debts non-dischargeable.
Unemployment Overpayments And Bankruptcy
Ohio officials recently announced that the state overpaid unemployment to the tune of $1.2 billion. Even if you received a notice that you were overpaidand owe the state money as a resultyou still have some options available.
First, you may be eligible for a waiver. If the mistake was a clerical error on their end , Congresss Continued Assistance Act makes it possible for states to forgive and waive overpayments. However, Ohio doesnt have a set policy on waivers yet, so you may need to pursue another option.
Next, you can file an appeal. A lawyer can help you navigate this complex process. If all else fails, your attorney can help you negotiate a payment plan with the state. These options could help you avoid filing for bankruptcy, which would allow you to avoid credit and related consequences.
If you do choose to file for bankruptcy, heres the good news: theres nothing that exempts unemployment overpayments from being discharged. You can file for Chapter 7 or Chapter 13 bankruptcythe right type will depend on your financial situation. If the debt is massive , and you are ineligible for a waiver or payment plan, this may be the best choice.
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How Can A Bankruptcy Help In A State Of Maryland Lawsuit
The number one thing a bankruptcy can do is to immediately get the persons license reinstated or get their car registration renewed, which is the most common reason people come to see us when they have problems with the State of Maryland. Being unable to drive a car can make it very difficult to take care of the family, go to work, take the kids to school or do the things people need to do to survive.
Also, a lot of these debts can be discharged or wiped out in a chapter 7 bankruptcy. For example, unemployment overpayments are a very common debt, and they can be wiped out in a bankruptcy as long as there is no fraud involved. A Chapter 13 filing can set up a payment plan to pay off the debt that cant be wiped out, like fines, parking tickets, taxes and any other kind of debt that cant be discharged in a chapter 7.
The person will get the same immediate relief with either a Chapter 7 or a Chapter 13 and they can get their license renewed, and they will be able keep any and all tax refunds without the State of Maryland intercepting them.
Can Unemployment Over-Payments Be Wiped Out?
Unemployment overpayments have become a very common reason for a lawsuit over the last few years because, as the economy went south a lot more people started collecting unemployment. The unemployment fund paid out more in 2009 and 2010 than they took in, because the economy was so bad and so many lost their jobs.
Can Motor Vehicle Administration Fines and Tuition Fees Be Wiped Out?
Chapter 7 Bankruptcy Trustee In Kentucky Strips Lien On Vehicle
Lisa G. Godsey filed for Chapter 7 bankruptcy protection in the Eastern District Of Kentucky. The Chapter 7 trustee sought to avoid, or, do extinguish the lien General Electric Credit Union thought it held on Debtors 2005 Nissan Ultima.
The facts in this case deomonstrate that on December 22, 2007, Debtor financed a 2005 Nissan Ultima with General Electric Credit Union, hereinafter, GE. The loan agreement with Debtor was entered into in the State of Ohio.
On Janaury 18, 2008 a Title Lien Statement was recorded in the Kenton County Clerks office in Kentucky. The Certificate of Title which was issued incorrectly identified Nissan Motor Acceptance Corporation as the lienholder with an address of 915 L Street, Sacramento, California 95814. This was the address associated with Nissan Motor Acceptance Corporation. However, the notation number on the certificate of title correctly reflected the Title Lien number assigned to GE.
The issue before the bankruptcy court was whether GEs lien was properly perfected. As the Court noted, Kentucky law determines whether a security interest in a vehicle is perfected. Furthermore, in Kentucky the only manner of perfecting a security interest in a vehicle is by a notation on the vehicles certificate of title. In fact the Court noted that he plain language of K.R.S. Section 186A.190 requires the name, the mailing address and the zip code to be on the certificate of title for proper perfection.
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Experts Warn Of Massive Bankruptcy Surge In Wake Of Coronavirus
Federal Reserve researchers are predicting that the number of coronavirus-related bankruptcies will surge to over a million in the coming months. The caveat is that Congressional efforts to stem the financial bleeding of our nation may have some impact on those numbers.
Those who are already in a difficult financial position before the quarantine are more likely than not to require the services of a bankruptcy attorney in the coming months. Those who were already in bankruptcy can expect their bankruptcy to continue to move forward despite measures put in place to stop the spread of the coronavirus.
In this article, well take a look at the financial impact that the coronavirus quarantine is likely to have on the U.S. economy.
What is the Government Doing to Help Americans?
The federal government, alongside state governments, has issued a series of moratoriums on debt collection practices that could help Americans out during this difficult ordeal. As an example, there is a moratorium on any foreclosures during this period. But once the quarantine is lifted, what will the banks do?
Those who are receiving money through unemployment right now may be getting enough money to pay off their mortgage, car loan, monthly expenses, child support, and more. Those who are only getting the $1,200 stimulus check, though, may have a very different outcome.
Debtors May Be Blindsided Once the State of Emergency Is Lifted
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Protecting Yourself From Fraud Charges
It is seldom a good idea to sell property just before filing for bankruptcy as the sale could mean you are charged with bankruptcy fraud. If you are facing overwhelming debt, rather than selling off property to try to keep your head above water, consult with a Kennesaw bankruptcy attorney and see what your options are. While some property may be sold without problem, you could risk your right to file bankruptcy if you sell property, particularly if it is sold for less than market value.
Keep in mind, you should also avoid transferring real estate, automobiles and other property that can be transferred to spouses, children or family members prior to filing bankruptcy. While you may think this is protecting the asset, in the long run, it could cause you far more problems than you need. On top of no longer having access to an asset, you could be facing fraud charges and you could also forfeit your right to seek protection under Georgia bankruptcy laws.
If you are in debt, before you decide to start selling off your assets, contact Roger Ghai, a bankruptcy attorney in Kennesaw at the Law Offices of Roger Ghai at 792-1000 unfortunately, sales of assets could prevent you from filing for bankruptcy and getting a fresh financial start.
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Tips For Rebuilding Credit After Filing Chapter 7 Bankruptcy
Many consumers who had to file for Chapter 7 bankruptcy are uncertain about what steps to take to rebuild their credit history. Chapter 7 bankruptcy eliminates all outstanding debt and for ten years, your credit report will show the debts included in the bankruptcy. However, few consumers are prepared to wait the full ten years after the process to start rebuilding their credit. There are some simple things you can do to establish a new credit history.