341 MEETINGS

Many new bankruptcy clients are unfamiliar with the purpose and procedure of a 341 Creditor's Meeting. A 341 meeting takes place with the bankruptcy trustee, and the purpose is to determine if the debtor has been accurate and complete in preparing their petition, as well as whether there are non-exempt assets that can be liquidated for the benefit of the creditor's. A "No Asset" finding is the holy grail for a debtor, and will result in a complete discharge of all debts in Chapter 7 bankruptcy.

 

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IF I AM MARRIED, DO I HAVE TO FILE A JOINT BANKRUPTCY PETITION?

The easy answer if no, you do not have to file a joint petition even if you are married, however, before filing, make sure you speak with an experienced bankruptcy attorney who can advise you on  the implications and consequences of joint versus separate filings.  Generally, if you are in a joint property state, if both spouses are liable for a majority of the debts, or if you are contemplating a divorce, it is probably wise to file jointly so both individuals will be discharged of that debt.  Conversely, if there is substantial debt in one party's name or  if one party would significantly affect the eligibility of filing, you may want to investigate filing individually.  One note, when a married individual files separately, both party's income is utilized for the purposes of the Chapter 7 Means Test.

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ILLINOIS SHOPPING MALL COULD BE FORECLOSED

Because the economy is down, many retailers are feeling the pressure just like everyone else.  As a result, malls across the county are experiencing 10-25% vacancies with many stores reducing their overhead.  Because of this, there are some malls that are facing foreclosure, including at least one in Illinois.  The Machesney Park Mall currently owes almost $2 million from the loan that was taken out to purchase the property eight years ago, including an additional $600,000 in real estate taxes.

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GABBY DOUGLAS' MOTHER FILED BANKRUPTCY

Over the past several weeks, American have become very familiar with Gabby Douglas, the young gymnast who become a national hero after winning the all-around gold medal for the United States.  Far from the glory of the Olympics also came news that Gabby's mother had filed Chapter 13 bankruptcy prior to the Olympics, and she was not embarrassed or ashamed to acknowledge that fact during the games.  Given Gabby's success during the games in London, I'm guessing the family's financial problems could be over, given that many experts have estimated Gabby's earnings over the next year to be between $6-20 million through mostly endorsements. 

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WHAT IS A MOTION FOR RELIEF FROM AUTOMATIC STAY?

Soemtimes a creditor will file a Motion for Relief from Automatic Stay in a bankruptcy case.  This commonly occurs when the debtor owns real property that he/she is planning on surrendering.  The purpose of this motion is to lift the automatic stay and allow the creditor the opportunity to continue with collection, or more commonly, foreclosure.  In the above instance, a lender or mortgage holder will be able to continue with the foreclosure process if the motion is granted and sell the property quicker, without having to wait for the bankruptcy process to conclude.

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WAGE GARNISHMENTS AND ASSIGNMENTS

Many people decide to file bankruptcy because a creditor has began garnishing their wages, which is when a court order is issued to deduct a portion of a debtor's wages in order to repay the creditor.  Garnishments will be stopped immediately upon filing bankruptcy, where creditors will be immediately notified by our firm of the filing.  Wage garnishments are different than wage assignments, where a debtor authorizes a creditor to deduct a payment from their wages, such as through a Pay Day Loan service.  These can be stopped prior to filing bankruptcy, so if you are in these situations, please contact one of our bankruptcy attorneys today to learn more.

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SHOULD I REAFFIRM A SECURED DEBT?

When you file a Chapter 7 bankruptcy petition, you must submit a Statement of Intention which indicates if you wish to reaffirm any of your debts.  A reaffirmation agreement is a secondary contract where you remain liable on a secured debt, such as a car or mortgage.  On the positive side, reaffirming a secured debt will allow you to retain the secured property and sometimes, reaffirming a vehicle could reduce your monthly payments because creditors would rather have a debtor pay a little less than have to repossess and resell the car.  On the other hand, reaffirming a debt can be dangerous because if you default on your payments following a bankruptcy, you will now be liable for that debt and the creditor can obtain a judgment against you that cannot be discharged.  For more information on this important decision, contact an experienced bankruptcy attorney today.

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