Most people know that bankruptcy is a process that eventually cancels monies owed to creditors. In legal terms, the canceling of a debt is referred to as a discharge of that debt. There is always some confusion about which debts can and cannot be discharged. As a rough guide, consumer debts that have not been [...]
Bankruptcy is a process that is designed to give debtors who are financially in trouble a little breathing space and relief from the pressure of those debts. Part of the bankruptcy process is a legal term known as a ‘stay’. A stay in simple terms is an order to all creditors to stop any actions [...]
When a debtor is underwater, they will often try a number of avenues before facing bankruptcy. Sometimes, those avenues work and the debtor is saved from the perceived loss of face through bankruptcy. Some of the methods used do come with side effects that debtors need to be aware of. They also need to be [...]
The costs associated with engaging a bankruptcy lawyer can be high, however, in the long run, their services often save a bankrupt a lot of money. Simple mistakes in your petition can see the court dismissing it, forcing you to file again, and to pay the filing fees a second time. There is one important [...]
The bankruptcy process is really a legal process that is handled through the courts. A bankruptcy judge handles the case and is advised primarily by the court officials and a trustee appointed by the court. In most cases, a petitioner never gets to see the judge. They only have to appear before the trustee when [...]
The term involuntary bankruptcy refers to the process where an individual is forced into bankruptcy by a creditor. If there are less than twelve creditors owed money by an individual debtor, then it only requires the action of one creditor to force an involuntary bankruptcy. If there are more than 12 creditors, then three must [...]
Bankruptcy is a useful tool that can help those in serious financial difficulty to clear many of their debts and then make a fresh start. There are several myths that surround bankruptcy, one of which is the thought that all debts are wiped away. This is far from truth in reality – in fact, for [...]
Bankruptcy is a legal process designed to help rescue debtors from overwhelming while also ensuring that creditors gain as much protection as possible. Over the years it has been a lifesaver for many with only the rich attempting to game the system for personal advantage. There is a growing belief in the credit community that [...]
Bankruptcy is a legal process that is undertaken through the court system. Every document that is submitted as part of the bankruptcy process requires your signature – and that signature is verification that the contents of those documents are accurate and true. Creditors are under the same obligation – when they submit documents they must [...]
Filing a petition for bankruptcy will help debtors clear unsecured debts from their life, allowing them to make a fresh start. Court-ordered liens are generally orders that relate to secured debts, not unsecured debts. Bankruptcy can still help debtors in these situations, although the debt itself will not be cleared by the bankruptcy process. Court [...]
A lawyer is a lawyer and it could be argued they are prepared to handle any case if there is a dollar in it for themselves. In practice, lawyers prefer to specialize in areas where they feel the most comfort. One misconception of a bankruptcy lawyer is that they only handle bankruptcies. This is far [...]
Deficiency judgments are relatively rare these days, but they do occur from time to time, and they do leave debtors in a great deal of distress and financial hardship. One reason for claiming a deficiency judgment is when a creditor feels that a debtor is in a position to pay – this can often be [...]
If you are going to file for bankruptcy, then in most situations you are going to have to pass a means test to see whether or not you qualify for a Chapter 7 petition. The means test is based on the state’s median income and while your income can be discounted for various factors, many [...]
There are times when people confuse the words “reject” and “object” when it comes to dealings with the bankruptcy court. Under a Chapter 13 bankruptcy petition, the debtor must include a repayment proposal that has a value equal to their disposable income after normal living expenses. Creditors can object to this repayment plan. They cannot [...]
Chapter 7 bankruptcy is the category of bankruptcy that allows debtors to liquify their assets under certain conditions. Here are five essential facts to know before you apply for Chapter 7 bankruptcy. Current monthly income is defined as the average income over the six months previous to the commencement of the bankruptcy case. This includes [...]
In the majority of cases, bankruptcy petitions are handled with only minor issues. These are generally worked through with the trustee, and the bankruptcy petition works its way to a satisfactory conclusion. Occasionally, the bankruptcy process can be disrupted by what is known as an Adversary Proceeding. For those who have filled in all their [...]
Generally speaking, retirement plans such as 401K are fully protected when it comes to a bankruptcy petition. While many assets can be seized under a Chapter 7 petition, for example, the 401K remains untouched. However, for some people, that 401K protection can be a real trap. When money is tight and lenders reluctant to extend [...]
In most cases, debtors petition the court as a means of obtaining relief from burdening debts. In rare cases, creditors can force an individual into bankruptcy. This will most often occur when the debtor has been operating a small business as an unincorporated sole trader. Involuntary bankruptcy can also occur to corporate entities, when creditors [...]
A Chapter 13 bankruptcy petition allows a debtor to submit a repayment plan that fully covers all secured loans. The trustee will do everything possible to ensure that the amount you pay each week, fortnight or month also covers part payments to your unsecured creditors. One difficulty that debtors face is not having sufficient funds [...]
Bankruptcy provides a pathway for debtors to clear their debts and make a fresh start. There are times when a creditor is making claims that a debtor has refuted. These debts must be included in the schedule of debts that is submitted to the court. While the debtor may be disputing these debts, failing to [...]
Many view bankruptcy as an easy path to debt avoidance. However, if you value your financial reputation, then this process should be at the end of your list of options, not at the top. Bankruptcy can often be avoided if you are prepared to work at it. If you can successfully work your way out [...]
Many people have the mistaken view that bankruptcy is designed to squeeze as much as possible from debtors and that creditors have all the rights. That view is far from what is day-to-day fact. Most creditors will tell you they have few rights and that thy have to accept what the court decides the debtor has [...]
In some sections of the community, credit collections agencies are a blight on our community. For others, particularly business owners, they are the difference between survival and bankruptcy. It’s ironic in a way since most credit collections agencies don’t want a debtor anywhere near the bankruptcy courts, despite their threats to the contrary. Here is [...]
For most struggling debtors, there are two bankruptcy options to select from. Chapter 7 bankruptcy petitions clear almost all of a debtor’s unsecured debts while a Chapter 13 bankruptcy petition will only clear debts after a period of repayments. Each option has specific rules that determine who qualifies for each. While many people will talk [...]
One of the benefits of seeking advice from a bankruptcy lawyer is that they will go through each debt with a fine tooth comb. There are a number of reasons for this. They are looking at the legal obligations such as legal costs in any legal action, early termination fees (if any), and whether or [...]
This is actually a trick question. Can anyone file for bankruptcy? Now legally, yes, any American citizen can apply for bankruptcy relief. In practice, whilst you can apply, there is no guarantee you will make it past the first phase. In fact, those going through the filing process without legal assistance rarely make it through [...]
A meeting of creditors is not as simple as it may sound. In most Chapter 7 and 13 bankruptcy petitions, a debtor is required to attend a meeting of creditors where they are questioned about their financial situation. This can be a rather intimidating experience – however, it needn’t be if you have an understanding [...]
A discharge in bankruptcy in simple terms is the termination of the bankruptcy process. When this occurs will depend on the type of bankruptcy and can be as short as four months for a Chapter 7 petition and as long as 4 or more years for other Chapters. Technically speaking, the debtor should be free [...]
