Is Bankruptcy right for me?
Bankruptcy can be solution
Do i need to file bankruptcy? Should I file bankruptcy? For most people, if you need to ask the question, the answer is probably yes.
But first, consider the following circumstances:
- Recently, by law, the minimum payment have greatly increased making it even more difficult to pay the bills.
- Have you signed personal guarantees for a business that was forced to close?
- Are you behind on your mortgage? Has a foreclosure been fields?
- Are you unable to provide for your children as you would like?
- Are you being harassed by collection agents?
- Are you unable to pay for your necessities?
- Have any lawsuits been filed against you?
We can help. Check our Bankruptcy Services
Asset Protection involves protecting assets (including cash, stocks, real estate, etc.) from being seized by creditors or plaintiffs. The Bankruptcy Reform Act changed the way an individual can file for bankruptcy (Chapter 7 and Chapter 11). Therefore, having a solid Asset Protection Plan in place can be quite beneficial.
For most people filing for Chapter 7 or 13 bankruptcy, protecting bank account funds is a priority . How bankruptcy will affect your cash or bank account deposits depends on whether the money is protected by a bankruptcy exemption and whether you are able to do some pre bankruptcy planning to protect money that is not exempt in bankruptcy.
Is the Money in Your Bank Accounts Exempt?
In bankruptcy, some of your property is “exempt,” which means it does not become part of your bankruptcy estate. In Chapter 7 bankruptcy, the trustee cannot take exempt property, which means you get to keep it. In Chapter 13, your property is safe, but you must pay back the amount of your nonexempt property during the life of your repayment plan.
If part of your cash or bank account deposits is not covered by an exemption, you may still be able to protect some or all of these funds by some careful pre-bankruptcy planning.
If the funds in your bank account are covered by an exemption, you don’t have to worry about losing the money or having to pay it back through your Chapter 13 plan.
As a Florida asset protection attorney firm, we can evaluate your situation, assess your risk and develop an individualized strategy for you and your family. Contact us to learn more.
What is a creditor? A creditor is someone (or some entity) that has a right to payment or other remedy against/from the debtor who is the subject of the bankruptcy filing. Your options as a creditor depend on which bankruptcy chapter was filed, how your claim arose, and what is going on in the bankruptcy case.
Creditors in bankruptcy are entitled to be heard by the court in matters concerning the debtor's plan (in chapters 11, 12, and 13), the liquidation of the debtor's non exempt assets, and payments from the assets of the estate.
Cease Collection Efforts
The Automatic Stay prohibits creditors from doing anything to collect their debts against either the debtor or property of the estate. Thus a creditor must immediately cease collection efforts, including telephone calls, billing or law suits that might be pending against the debtor. If you are a secured creditor on a delinquent loan, you may be able to get an order of the Court allowing you to obtain the property. This depends in large part on the kind of bankruptcy that is pending and the amount of equity in the property.
When to Consider Bankruptcy
The best time to consider bankruptcy is when you’ve fallen at least 3 months behind on your mortgage payments. At this point, your lender is likely to find your loan in default and begin foreclosure proceedings, of which you will be notified. By this point, your options to either refinance the loan or to work out a new payment plan with your lender have probably dwindled. Foreclosure means your lender wants the entire amount for the home, and if you don’t have the money to pay it, you’ll end up on the hook for a large sum of money.
What Not To Do BEFORE Bankruptcy
DO NOT let your property get taken. After a house is foreclosed or a car is repossessed, there is nothing a bankruptcy will do to get it back. Seek our attorney's protection before that happens.
DO NOT continue to use credit. Stop using your credit cards. Stop getting payday loans or other personal loans. Stop all credit entirely. Recent debt before filing for bankruptcy protection can limit your ability to wipe out those debts. In addition, the creditors may be successful in proving you are not filing bankruptcy in good faith. If that happens, you may not be able to receive bankruptcy protection at all.
DO NOT transfer property out of your name for the sole purpose of keeping it out of the hands of the creditors.
DO NOT make a large cash advance before filing. Cash advances greater than $750 within 70 days of a bankruptcy filing are presumed to be an abuse and will be thrown out by the bankruptcy trustee unless you can make a convincing argument.
Stay away from a retirement account. Federal law protects retirement accounts. At some point, if you can’t right the financial ship, just move ahead with bankruptcy. If you try to use money from a retirement account, you may still end up in bankruptcy. And now your retirement account has taken a hit that as unnecessary.
Avoid any loan or credit purchase you don’t intend to repay. This goes back further than the strict 70 or 90 day rule in federal bankruptcy law. A trustee has the power to go back a year or more and decide a purchase on credit was an abuse because you never intended to repay for the cost of the item.
Filing Bankruptcy Before the Foreclosure Sale
If you file for bankruptcy before the foreclosure sale of your home, you’ll receive what is called the automatic stay. For the most part, an automatic stay offers you protection from foreclosure. It means you can stay in the house. It also means your creditors cannot come after you for money until your case is discharged. Your lender has the option of trying to have the automatic stay lifted, but this process typically takes 2 to 3 months. So even if your lender has the stay lifted, most bankruptcy cases are done within 90 days of filing, which means you could be discharged before the sale.
Types of Mediation Services
Frank Heston's bankruptcy mediators are available for a variety of adversary proceedings or contested matters, including:
- Sale of Assets
- Mortgage Modification
- Claim Objections
- Objections to Exemptions
- Collection & Turnover Actions
- Validity of Lien Proceedings
- Fiduciary Duties
- Churning of Accounts
- Motions for Relief
- Unauthorized Investments
- Complex Financial Transactions
- Plan Issues
- Consumer Protection Actions
- Preference Cases
- Lien Avoidance
- Complex Tax Issues
- Broker Misconduct
- Breach of Contract
- Dischargeability Matters
- Fraudulent Transfer
Can Student Loans be discharged in Bankruptcy?
Only if your student loans creates an "undue hardship" for you and your family. If you can prove to the bankruptcy court that you're only earning enough to pay for a "minimal standard of living", meaning you can’t afford cable, Internet or a personal cellphone, then you have a chance. You also have to prove that your finances aren't likely to get better anytime soon. It helps if you were able to make at least a few payments on a monthly basis, this shows the court that you have been trying to be diligent to your dues.
File Adversary Proceeding to Discharge Student Loans
A hardship discharge won't happen automatically when you file for bankruptcy. Our attorneys normally file an extra petition, which is called an Adversary Proceeding. This document basically asks the court to make an exception in your case since the standard rules prevent loans to be erased.
Chapter 13 Bankruptcy and Student Loans
When Chapter 13 bankruptcy instead of Chapter 7 is filled, you agree to pay off your debts over a period of three to five years. The court will supervise your payments, and your student loan lenders won't be able to demand the whole loan due at once. At this point, each month, you give your bankruptcy trustee all your extra income, and the trustee divides that money among all your creditors. This can make your overall monthly payments go down.
How our Bankruptcy Lawyer Can Help You
The law surrounding student loans and personal bankruptcy is very complicated. Each case is unique and your circunstances may vary. For more details, specific information, please contact our bankruptcy lawyers and setup a free backruptcy consultation.