These next three scenarios were provided by bankruptcy attorneys, who used fictional names for the clients in describing the bankruptcy cases. Maria is a retired teacher on a fixed income. She sold her home and moved in with her daughter. She had excellent credit because of on-time payments on her mortgage.
Careful with her money, she also had no debt. She agreed to cosign on a mobile home loan for her grandson and a car loan for her granddaughter. How could she say no? And her credit was sterling. But two years later, the mobile home was repossessed after the grandson was divorced. There was substantial debt remaining when the car and home were sold at auction. Maria, in failing health, was hounded by creditors who called about the deficiency claims.
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Maria filed a Chapter 7 bankruptcy, which stopped the harassment and eliminated the deficiency claims. Her social security and retirement income were exempt and protected in the bankruptcy. After graduating from nursing school, Traci got a job at the local hospital. She used student loans to pay for most of her college expenses. As some college students will do, she ran up some credit card debt with frivolous purchases. In her last year of school, she was injured in an automobile accident.
But she made payment arrangements with all of the creditors, so things seemed fine as her nursing career began. When the first payments for her student loans were due, she barely had money left after paying utilities and other expenses. She had already deferred her student loan payments. The collection notices began arriving. She found herself distracted and unable to sleep because of worry over her finances. When Traci filed a Chapter 7 bankruptcy, she eliminated the credit card debt and medical bills.
She then had enough money to make her student-loan payments. Pete and Sheila have two small children. When Pete was discharged from the Army after six years of service, the money was tight. After their children were born, Pete landed a job as a delivery man, but the salary was substantially less than his military pay.
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Monthly bills became a struggle, considering the decreased income and increased expenses. Trying to be smart and prudent, they stopped using their credit cards. But there was still credit card debt that began early in their marriage. The finance charges and late fees began taking a toll.
When the creditors began calling, Sheila already was unnerved while caring for two active children. The creditors soon called Pete at his job and said they would garnish his paycheck. Pete and Sheila decided they had enough. They contacted a bankruptcy lawyer for a consultation. By filing a Chapter 7 bankruptcy, they stopped the phone calls and harassment. Their credit-card debt was eliminated. Because they rented a house and owned two older vehicles, much of their life was kept in order.
From a practical standpoint, there are two questions that generally come up for anyone considering bankruptcy. How much debt do I need to file for bankruptcy? And, is there an income limit for bankruptcy? Under Chapter 7, there is no minimum debt limit there are stipulations under Chapter Every situation is different, but here are some factors to consider before filing for bankruptcy.
Failing to follow these instructions could undermine your efforts. No New Debt — A new creditor could claim you took out a loan or ran up the balance on a credit card without intending to pay it back. They can all be classified as fraud. Be Truthful — You are required, while filing for bankruptcy, to provide full and complete information. You must disclose any debt, assets, accounts or other financial information.
Failure to comply could lead to fraud and potential criminal charges. You could use that money to pay down your debts. Never think you can get away with something sneaky or dishonest. Once you qualify to file for Chapter 7 bankruptcy, it will take up to four months to complete the bankruptcy process. The most important factor is finding an experienced and reputable bankruptcy attorney. To start the process, the debtor must file a petition with the local bankruptcy court. Bankruptcy involves a lot of paperwork, which becomes public record.eschitebe.tk
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Any mistakes in filing and it could be rejected by the court, putting you back at square one. Look for an attorney who has bankruptcy knowledge, the ability to develop a professional relationship and legal fees that are commiserate with the complexity of your case. The fees might seem high, but as a general rule, you get what you pay for in bankruptcy proceedings. You are required to attend a meeting of creditors, which will take place about 30 days after the case is filed.
The trustee, an attorney or accountant appointed by the government to oversee and review the bankruptcy, will preside over the meeting. The entitlement event is most commonly death. Thus, if someone dies within the day period following the filing and that death ultimately entitles you to money regardless of when you get the money , the money reverts back to the petition date and the trustee will administer it.
What if I am on a joint account or on the deed to real estate with someone else purely for the purposes of estate planning and have not contributed any money to the account or any money for the fractional interest in the real estate? Will the Bankruptcy Court say that I own part of those assets and try to take them? If you are on a bank account or deed or you co-own anything with someone else, it is an asset that you own and the Bankruptcy Court will take your interest to satisfy creditors.
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Most often, a parent or grandparent will put a son, daughter, grandson, or granddaughter on a checking account or on a deed to avoid probate. This may be a good arrangement for estate planning purposes, but for bankruptcy purposes, it represents a very real hazard that should be avoided at all costs. Can I get out of debt in a Chapter 7 bankruptcy that I have been ordered to pay in a dissolution proceeding?
Alimony, maintenance, and child support payments are generally not dischargeable.
In order to take advantage of a 15 , the spouse must obtain an order from the bankruptcy court declaring the debt non-dischargeable. How long does it take to be discharged once the petition is filed? The discharge order is normally entered immediately after the deadline to file a complaint objecting to discharge expires. The deadline to object to the dischargeability of a debt is set for approximately 14 weeks from the original petition date the date the case was originally file stamped with the court.
Therefore, the discharge order is normally entered with the court approximately 4 months from the petition date. In certain circumstances, the discharge can be delayed. Normally, a discharge order is delayed because the debtor is not cooperating with either the trustee or a creditor. In these instances, the court enters an order extending the time of the entry of the discharge order.
In some limited circumstances, a discharge can be revoked. Also, in some limited circumstances, there is a continuing obligation to report the occurrence of certain events that extend beyond the discharge date. Can I transfer assets to someone else prior to filing and get them out of my name so that they are not my assets when I go to file bankruptcy with the court? You cannot give away your assets prior to filing. Doing so is a very serious matter. In all instances, the trustee will determine to whom you transferred property within one year of filing.
Some trustees go back as far as five years. This is designed to prevent people from giving their property away before filing in order to prevent it from being liquidated by the trustee for payment to creditors. Transferring property to others prior to filing is a serious matter and should be avoided at all costs.