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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HOW CAN I USE A BANKRUPTCY TO DEFEND A FORECLOSURE?

A bankruptcy can be an effective way to avoid or delay a foreclosure.  If you are behind on your payments, but are still earning income, you can file a Chapter 13 bankruptcy in order to allow yourself time to "catch up" on your mortgage payments.  A Chapter 13 bankruptcy could allow you up to 60 months to pay off any previous unpaid mortgages or penalties.  If you are prepared to surrender your property back to the lender, but just want to delay the process a few months so you can get everything in order, a Chapter 7 bankruptcy may be your answer.  While a Chapter 7 bankruptcy is ongoing, a lender cannot proceed with a foreclosure case due to the automatic stay, and as a result, you will be able to continue residing in your property for a feww extra months.  Please consult an experienced bankruptcy attorney before proceeding with any of these avenues in order to ensure you know what to expect in the end.

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HOW LONG IS A CHAPTER 13 REPAYMENT PERIOD?

As discussed before, in a Chapter 13 bankruptcy you are required to repay a portion of the debt to the bankruptcy trustee who then distributes the payment to the creditors.  Exactly how long your repayment plan is depends on your assets, income, and debts.  It will be between 36 and 60 months, and you are required to make that payment every month, or else the bankruptcy will be dismissed without any reduction or discharge of the underlying debts. 

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HOW WOULD A BANKRUPTCY AFFECT A FORECLOSURE?

As I mentioned in a previous post, you have three options as to how to handle secured debts in a Chapter 7 bankruptcy.  If you are willing to lose your house, you could file a Chapter 7 bankruptcy, surrender your property, and have any deficiency discharged throughout the bankruptcy process.  If you are behind on your payments and would like to retain your home, you could always file a Chapter 13 bankruptcy, which delays the foreclosure, and allows you an opportunity to "catch up" on your mortgage payments and bring your loan current.  If this is done, you can stop the foreclosure process and continue living in your house as if you were never behind on your payments.  Contact one of our bankruptcy lawyers today to learn how a bankruptcy can help you out of your foreclosue.

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CAN I FILE BANKRUPTCY IF I AM A BUSINESS OWNER?

The answer to this is probably, although being a business owner complicates things. For example, for an individual, his/her income and assets are relatively easy to determine, however, often times this is not so with a business owner. If you own all or a majority of a business, you could also be respionsible for the assets of the company, meaning the bankruptcy trustee could choose to seize those assets in order to repay the creditors. In order to learn more and protect your business, contact one of our bankruptcy attorneys today for a free consultation.

WCZ
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CAN YOU USE YOUR CREDIT CARD RIGHT BEFORE FILING BANKRUPTCY?

The answer is dependent on when the credit cards were last used and for what purpose. Generally, any use of a credit card for luxury goods over $500 and debts owed to any one creditor incurred within 90 days of filing will not be discharged. Also, any cash advances made within 70 days before filing or debt incurred without any intention to repay will also not be discharged. Typically, if minimum payments are made to the creditor for the last six months prior to filing, a debtor should have no problem having such a debt discharged as long as no debt was incurred under false pretenses or fraud.

WCZ
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CAN I TRANSFER ASSETS TO OTHER BEFORE FILING IN ORDER TO AVOID LOSING THEM IN A CHPATER 7 BANKRUPTCY?

In a bankruptcy case, trustees have a lot of power and discretion. They are working on behalf of the creditors in order to determine whether there are any assets of the debtor that can be seized and distributed. As a result, the trustee is not going to look favorably upon a debtor transferring property or assets in order to keep them out of the hands of the trustee. In my experience, any transfers done within one year prior to the filing of the petition can be reversed by the trustee or he/she can pursue those assets. This is referred to as the "lookback period." If the transfer was made more than four years ago, those assets will usually be outisde the scope of the bankruptcy proceeding. The gray area comes in between those two periods. If the trustee feels the transaction was performed primarily to keep the assets out of bankruptcy, he will likely pursue them if it was done within the last four years. If the transfer looks like a bona fide good-faith transaction, the trustee will probably have no problem with it provided it occurred over one year ago.

WCZ
http://www.westmontattorneys.com