Category Archives: Bankruptcy

Chapter 7 Bankruptcy – A Quick Overview

The concept of bankruptcy that the common person has, is about
the chapter 7 bankruptcy. This type of bankruptcy is also termed as
straight bankruptcy or liquidation bankruptcy. This article intends to
explain the basic things that you need to know regarding the chapter 7
bankruptcy.

What is chapter 7 bankruptcy?

Once a
debtor is granted bankruptcy under the Chapter 7 bankruptcy, a trustee
is appointed by the bankruptcy court. The trustee then arranges to sell
off all the assets, as declared by the debtor. The money thus collected
is used to pay off the debts owed to various creditors based on the
priority level, if any. This way, we can see that the chapter 7
bankruptcy is the worst kind of bankruptcy. The debtor gets no chance to
continue with their business operations. All their assets are sold off,
except for the exempted assets as applicable as per the specific
bankruptcy laws of that particular state.

Is chapter 7 bankruptcy a matter of choice?

The
first thing that you must know regarding the chapter 7 bankruptcy is
that it is not a matter of choice. Not everybody can file for bankruptcy
under chapter 7. There are certain eligibility criteria that you need
to fulfill, in order to file a petition for chapter 7 bankruptcy in the
bankruptcy court. After the inclusion of the new bankruptcy laws to the
bankruptcy code, now it is mandatory for all the debtors to pass a means
test before filing bankruptcy. The MEANS test is a procedure, where you
have to analyze your income and expenses, in order to see if the money
left after deducting the necessary expenses is sufficient to pay off the
monthly installments of the various debts that you owe. If the money
left is less than the median income of the state, you can qualify for
the chapter 7 bankruptcy. On the other hand, if the money left after
deducting the expenses, is more than the median income of the state, you
will not be able to file bankruptcy under chapter 7 of the bankruptcy
code. For such cases, chapter 13 bankruptcy is applicable.

How much does chapter 7 bankruptcy cost?

Filing
bankruptcy under chapter 7 of the bankruptcy code, costs almost 250 to
350 dollars depending upon the specific case. However, you should not
forget about the long-term bankruptcy cost that chapter 7 bankruptcy
brings with it. Once you are declared bankrupt under this chapter, the
bankruptcy will keep affecting your financial life negatively, for the
next 10 years at least.

Bankruptcy Lawyer – The Requirements

Bankruptcy is the legal declaration of an individual or a business that it is unable to pay off its debts. It is simply a way of starting fresh financially by offering creditors a repayment based on the available assets.

Filing a bankruptcy option is considered to be a major financial decision for a debtor as it changes things drastically. Depending upon the situation, a debtor can opt for any option that bankruptcy petition offers. The two most commonly preferred bankruptcy chapters are – –

Chapter 7 – This is the most commonly preferred bankruptcy option. It involves the liquidation of a debtor’s assets. As a person applies for a bankruptcy petition, the court appoints a trustee who evaluates the value of a debtor’s non-exempt assets and liquidates it to pay off the creditors. Exempt property of a debtor cannot be liquidated.

Chapter 13 – This is another popular bankruptcy option that allows a debtor to take some time (3-5 years) to pay off the creditors. This option is ideal for only those individuals who have a steady income option and who can afford to pay the outstanding debts after the given time. Partnership businesses and corporations cannot apply for this kind of bankruptcy option. A debtor who applies for this option needs to submit a repayment option to the court for approval.

Bankruptcy cases involve complications and no common man can deal with them without any expert assistance. A bankruptcy lawyer can be the right person who can help you out in the whole procedure. Even in deciding the right bankruptcy option, your attorney can help you out. An experienced lawyer will have contacts with court personnel and so he will be updated with all the latest legal details. Plus, bankruptcy cases have loads of paper-works to be taken care of.

While choosing a good bankruptcy lawyer, you need to take care of the following facets.

Qualifications – An eminent lawyer must have excellent qualifications. You must go through all the certifications your attorney holds before hiring him for handling your case.

Experience – this is a major factor that you need to take care of. A good lawyer must hold a considerable experience in the field.

Referrals – You can try talking to some of the previous clients that your attorney has handled lately. This will give you a fair idea of how efficient your lawyer is.

If you need assistance in getting your case filed, get yourself a proper bankruptcy lawyer. Niguel dwellers can seek expert legal help at 4Bankruptcy.

For more insights and additional information about choosing a bankruptcy lawyer Niguel as well as getting a free bankruptcy consultation from an local attorney to you, please visit our web site at www.4bankruptcy.com.

Reafermation Agrements in Bankruptcy what happens to those secured items

Often I am asked this question about cars that are kept after filing a bankruptcy . You handled my Utah bankruptcy about 9 months you helped me alot . I just have a quick legal question that will not take much time. At the time I decided to keep a car pay the monthly payment. I located a less expensive vehicle that I can purchase and not be tied down with the car payment. If I do not make payment will they take the car and if they do will I owe the money again? During the first year or so after bankruptcy, many people clients inquire of me if if it is possible to return back the vehicle. They wanted to retain it when they took out bankruptcy, but now it is not working out for them. Sometimes because of a mechanical issues. Some people want to get rid of the car with a payment and just pay cash for a less expensive car. It is possible to return the car. The bankruptcy still protects you . If you stop paying , they can come and repossess it, but they cannot get any money from you. Only if you did not sign a reaffirmation agreement. There’s an exception that’s if you reaffirm the debt during the bankruptcy. Reaffirming is a separate agreement signed by you. If you reaffirm, then you remove the debt completely out of the bankruptcy, and you can’t change your mind down the road about getting rid of that debt.. You are obligated on the debt even after the bankruptcy. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com or www.mybankruptcyutah.com Often I am asked this question about cars that are kept after filing a bankruptcy . You handled my Utah bankruptcy about 9 months you helped me alot . I just have a quick legal question that will not take much time. At the time I decided to keep a car pay the monthly payment. I located a less expensive vehicle that I can purchase and not be tied down with the car payment. If I do not make payment will they take the car and if they do will I owe the money again? During the first year or so after bankruptcy, many people clients inquire of me if if it is possible to return back the vehicle. They wanted to retain it when they took out bankruptcy, but now it is not working out for them. Sometimes because of a mechanical issues. Some people want to get rid of the car with a payment and just pay cash for a less expensive car. It is possible to return the car. The bankruptcy still protects you . If you stop paying , they can come and repossess it, but they cannot get any money from you. Only if you did not sign a reaffirmation agreement. There’s an exception that’s if you reaffirm the debt during the bankruptcy. Reaffirming is a separate agreement signed by you. If you reaffirm, then you remove the debt completely out of the bankruptcy, and you can’t change your mind down the road about getting rid of that debt.. You are obligated on the debt even after the bankruptcy. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com or www.mybankruptcyutah.com

IVAs – new figures out next month

Next month, the Insolvency Service will publish its latest figures, revealing how many new insolvency cases began in the third quarter of 2010.

The term ‘insolvencies’, of course, doesn’t just apply to IVAs (Individual Voluntary Arrangements).

It applies to bankruptcies, IVAs, Protected Trust Deeds and DROs (Debt Relief Orders), since the Insolvency Service provides statistics for all four of the countries in the UK: England, Wales, Scotland and Northern Ireland.

* In England and Wales, people with serious debt problems may be able to enter bankruptcy, an IVA or a DRO.

* In Scotland, bankruptcy is often called sequestration, and IVAs don’t exist at all – although Scottish residents may be able to enter a Trust Deed (which is similar to an IVA in many ways) if they’re in financial trouble and can’t repay their debts.

* In Northern Ireland, IVAs and bankruptcy exist, but DROs have not been introduced (so far).

Third-quarter IVA figures
On 5th November, we’ll see how many people ended up entering insolvency between July and September this year.

Looking just at England and Wales, the figures for the second quarter of 2010 were unusual in quite a few ways:

* The number of IVAs hit an all-time high of 13,466 – an increase of 14% on the 11,782 IVAs that began in the first quarter of the year.

* The number of DROs also hit an all-time high (although this isn’t as significant as it is with IVAs, as this was only the fifth quarter since DROs were introduced). In Q2, there were 6,295 DROs – a 12% increase on the previous quarter and a massive 218% increase on the second quarter of 2009 (when they were introduced).

* The number of bankruptcies actually dropped in Q2, to 14,982. In fact, we saw fewer bankruptcies than we’ve seen in any quarter since the end of 2007.

* Thanks to the fall in bankruptcies, the total number of insolvencies in England and Wales dropped to 34,743 – not just lower than the 35,682 in the previous quarter, but lower than in either of the two quarters before that. This was the first quarter since the end of 2007 in which the number of bankruptcies didn’t increase on a quarterly basis.

A note from the IVA Forum

An expert at the IVA Forum commented: “It’s important not to forget R3’s warning about ‘insolvency lag’ – the fact that there’s usually a gap between the end of a recession and the peak in numbers of people (and companies) entering insolvency. As we deal with the after-effects of the recent recession, it’s likely we’ll see a great many people entering an IVA, a DRO or bankruptcy as a result of problems that have been affecting them for some time.”

Reasons To Make An Effort Having A Home Budget Plan

Do you currently know how much income your household takes in each month? Exactly where does all this income go? How long can you financially endure if you lose your current earnings? These are concerns that every home ought to address and answer. The technique to answer these pivotal questions is to formulate a household budget. Among the biggest issues when a person is having money troubles includes an understanding of their cash flow. Whenever talking about cash flow, it’s simply the flow of money into your household and the flow of money out of your home. When the money inflow is greater than the cash outflow, you have a surplus and life is good. If the inflow of cash is less than the outflow of money, you have a predicament that must be remedied.

A budget plan is the most effective way to determine what money is entering into your household and what cash is leaving your household. A person may have never had a household budget and have absolutely no strategy where to start. You have a variety of viable options. You can get online and obtain free budget templates. If you’re good with certain software programs, you can create your very own personalized budget sheets. You may have access to a personal financial planner or accountant which can assist you in setting up your budget. If you have questions concerning bankruptcy or if you’re unclear if your circumstance would necessitate debt forgiveness, consult an experienced bankruptcy lawyer or attorney. Meeting with an attorney or financial professional will help you to clarify your current circumstance and provide you time tested advice regarding your next logical step. You may find that your financial position can possibly be greatly improved by simply trimming certain expenditures or picking up a part time job. These steps may aid you budget your way out of personal bankruptcy and guide you toward financial health.

Right after you have examined your alternatives, you need to manage your budget effectively. Regardless of whether you consult a lawyer or attorney and find that bankruptcy is your most ideal option, you still need to establish a budget for the future. There are a number of things to think about when creating a household budget:

* Make certain you list all sources of income (salaries, rental income, child support, dividends, etc.).

* Divide your expenses in sub-categories (groceries, mortgage, car expenses, loans, utilities, etc.).

* Distinguish between your fixed monthly expenses (i.e. loan payment) and you variable monthly expenses (i.e. groceries).

* Account for every dollar you spend.

* Create a monthly average for each of your variable monthly expenses.

* Plan in advance and save for substantial future expenses (vacations, holiday gifts, roof repair, etc.).

* Create and fund an emergency savings account to cover unexpected expenses.

A person must take their monthly budgeting very seriously. Accounting for every dollar of income and every expense is crucial to capturing of your finances. Adhering to a solid budget plan may help you climb out of a financial hole. However, your circumstance may require you to consider bankruptcy as an option. Regardless of what decision you make, planning a regular monthly household budget will dramatically benefit your future financial outlook and provide you control over your cash situation.