Chapter 7 Bankruptcy Exemptions

Author: David Romito

Federal and state bankruptcy laws reflect the public policy value that no one should be deprived of all of their property.  The federal bankruptcy laws, as well as the state laws where you reside, therefore, both allow for certain “exemptions.”  Federal exemptions are the same for all bankruptcy filers nationwide, while state exemption limits vary from state to state. The debtor may choose whether to use the federal or state exemptions; in general it’s best to use the federal exemptions because they are more ‘generous’ (that is to say, higher).

How your assets will be treated with respect to these exemptions depends on how much ‘equity’ you have in the property. Equity for all property that is not collateralized (that is, there are no liens against it) is simply the fair market value of the property.  Equity for property that does have a lien against it (the most common examples being a house or a vehicle) is calculated simply by subtracting from the fair market value of the property any amounts you owe on loans secured by that property.  For example, let’s say your house has a fair market value of $200,000, and that you have a first mortgage outstanding balance of $150,000, and a second mortgage (or home equity loan) balance owed of $30,000.  Your equity would be calculated as:

            Fair market value:                                                         $200,000

            First mortgage balance:                                                $150,000

            Second mortgage balance:                                            $30,000

            Total debt secured by home:                                         $180,000

            Equity in home:                                                            $20,000        

Bankruptcy exemptions set a certain dollar limit on the amount of equity that you can have in a specific type of asset. If you have more equity than what the prescribed exemption allows, the bankruptcy trustee may seek permission from the court to ‘administer’ the property, that is, to sell it in order to distribute the proceeds among your creditors. 

And that raises the very important question, what are the exemption limits for the various types of property?  To help answer that question, below are listed the federal exemption dollar limits for the most common asset types.  Bear in mind, these figures are for a single debtor.  To calculate the figures for a married couple (that is, for joint debtors), simply double the dollar amounts indicated:

Real property                                                         $ 20,200

Vehicle                                                                  $   3,225

Household goods (clothes, appliances, etc.)             $ 10,775

Jewelry                                                                 $   1,350

Retirement accounts (401K, 403B etc.)                     unlimited

“Wildcard”                                                              $   1,075*

* There is actually a second, and much larger, “wildcard” exemption available, but it’s a function of what amounts the debtor has used in other categories and is therefore a little more complicated to calculate – you’d be well advised to talk to an attorney about this one.

In sum, then, the above should give you at least a rough idea of whether you are within the limits – as far as assets are concerned – for qualifying for a Chapter 7 bankruptcy.  If you’re not, don’t despair – this might just mean that you’ll need to consider filing under Chapter 13 instead.

Article Source: http://www.articlesbase.com/bankruptcy-articles/chapter-7-bankruptcy-exemptions-730505.html

About the Author

David Romito is a Bankruptcy Attorney handling matters in Pittsburgh and the Western District of Pennsylvania. For more answers to your bankruptcy questions, please visit his website at Pittsburgh Bankruptcy Attorney .

What Chapter 11 Bankruptcy Law Entails

Author: Peter Gitundu

Chapter 11 bankruptcy law is also known as the reorganization code applicable to partnerships and corporations. It allows for businesses to make a plan on how to pay off their debts without having to sell their property. This comes as an opportunity for businesses to keep on operating even when they are in a financial crisis. Partnerships and corporations are eligible to file under this chapter in court. It may be voluntary, meaning that the debtor will file the petition, or involuntary where creditors who meet some standard file the petition.

To have the court accept the bankruptcy petition, he should also attach financial documents of the previous years operations. They must have gone through credit counseling on how to manage the debt. A fee is paid to the court clerk to cover filing charges and to pay the trustee. These can be paid in installments for not more than one eighty days after filling the petition. Once a voluntary or involuntary petition has been filed, he assumes the position of a “debtor in possession” meaning that he is still in control of the property.

For the bankruptcy petition to be accepted in court, he should also file a reorganization plan and a disclosure statement which includes information on the assets, liabilities and the business affairs. This enables the creditor to have an informed perspective on the reorganization plan filed.

Chapter 11 identifies the debtor under a corporation or a partnership as a separate entity from the business and as such personal property is not at risk. However, for a sole proprietor, he is part and parcel of the business and therefore personal property may be at risk.

Article Source: http://www.articlesbase.com/personal-finance-articles/what-chapter-11-bankruptcy-law-entails-892126.html

About the Author

Peter Gitundu Researches and Reports on Bankruptcy. For More Information On Chapter 11 Bankruptcy, Read More Of His Articles Here CHAPTER 11 BANKRUPTCYYou Can Also Add Your Views About Chapter 11 Bankruptcy On His Blog Here CHAPTER 11 BANKRUPTCY

The Automatic Bankruptcy Stay Explained

Author: Dave D. Clark

When falling behind on mortgage payments, foreclosure is not inevitable. Since the real estate market collapsed, more than 5% of all homes loans are in default. Today, workout situations are common. Lenders try to avoid repossessing homes, which in turn, bloats their balance sheet with non-performing assets. You may have time to workout an arrangement with your lender. Perhaps a loan extension is available. You may consider a different lender to refinance, focusing on high risk specialists. You may consider a deed in lieu of foreclosure if you cannot make mortgage payments.

In every situation, borrowers have unlimited options that include working cooperatively with creditors, settling debts, litigating disputes, and confronting creditors in the U.S. Bankruptcy Court system.

Bankruptcy automatically stops all foreclosure proceedings. The mechanism is known as the automatic stay. Each time a case is filed, under any chapter, the automatic stay prevents creditors from collecting debts. The stay provides broader protection by prohibiting repossession of assets, home foreclosure, and the continuation of lawsuits seeking judgments on debts.

The stay is not permanent. Borrowers who file bankruptcy have two options to bring payments current. In Chapter 7, actual payment is required to prevent the court from lifting the automatic stay. In Chapter 13, the court indulges legal fiction. The inclusion of payments in the plan creates an assumption that payments are current. To maintain a Chapter 13 case in good standing, monthly payments to a trustee are required.

Future mortgage payments must be made to avoid foreclosure in all bankruptcy cases. If you home has negative equity, homeowners in bankruptcy should carefully consider the long-term impact of keeping their home. You may surrender your home and treat the deficiency balance as an unsecured debt. All remaining unsecured debts are discharged when a case is closed. Chapter 7 typically lasts about four months unless creditors file objections. Chapter 13 cases last from three to five years before receiving a discharge.

Timing a bankruptcy case properly is critical for your success. You may file too quickly or too late to receive the maximum benefit available. If you file too early, you may not qualify for Chapter 7 because of the means test. If you file too late, you may unnecessarily waste exempt assets and potentially incur imputed income. Imputed income creates tax liability when lenders charge off debts. The best bankruptcy strategies begin well in advance of the filing date. In this way, you will gain the maximum allowed benefit and prevent the accrual of non-dischargeable tax liability. If you consider a few advanced strategies, you may adjust debts in a plan and receive a quick discharge by using your options at the proper time and in the proper sequence.

Article Source: http://www.articlesbase.com/bankruptcy-articles/the-automatic-bankruptcy-stay-explained-1514831.html

About the Author

Dave Clark enjoys bankruptcy strategy questions. Can bankruptcy stop foreclosure? Find out more why Chapter 7 bankruptcy stops foreclosure temporarily through his website.

Why Do You Need Bankruptcy Attorneys?

Author: Judy Dixon

It is abysmal and often very difficult to take see yourselfbeing insulted for debt, to see your property repossession and face foreclosure or simply not being able to see yourself on the other side of all your debts. If you also find yourself in such a case of mounting debts and torturing creditors then perhaps you should take the first appointment you get with a bankruptcy attorney. For bankruptcy lawyers it is their business and they know about everything that goes around in it so they will be able to sketch out a viable alternative for you which you might not even think can be worked out. So give in an expert and let them help you.

Along with repaying your debts and the bankruptcy attorney can also guide you to sell off your property in order to repay the creditors. And if selling off your property is not exactly your idea of getting rid of all your debts the bankruptcy lawyers can also assist you in making an arrangement with your creditors approved by the court to repay them in a pre-determined frame of time. Again, if you hire a bankruptcy attorney they are updated with every last bit of information regarding the United States Bankruptcy code. Bankruptcy is not an easily gliding procedure it can really confuse nonprofessional so a bankruptcy lawyer really can make things easy and facilitate them for you. The most common procedures in bankruptcy proceedings are Chapter 7 wherein you follow the debt liquidation or reorganization. The other one is arranging for repaying the indebted money under the Chapter 9, 11, 12, or 13 bankruptcies.

If you are thinking of filing for bankruptcy, a bankruptcy attorney is recommended. The rules of bankruptcy have changed and new norms have been introduced which a nonprofessional cannot be expected to know about. Again, the new rules have made it only difficult to file for bankruptcies all the more reason you will need bankruptcy lawyers to make your experience more pleasant after everything that you are already going through. They will be able to suggest you ways to get rid of your debt mountains, deal with your property and assets in a way that will benefit you and give you more time at hand.

Article Source: http://www.articlesbase.com/banking-articles/why-do-you-need-bankruptcy-attorneys-1634939.html

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Bankruptcy Attorneys also work with the creditors and give them the assurance that their funds will also get recovered back. So a bankruptcy attorney is obviously a person you are going to thank once you see the benefits of hiring them.

Author: Mercy Maranga

During these harsh economic times more and more people are filing for bankruptcy. Once frowned upon, it is now a common option for individuals with unmanageable debt. This is despite the fact that the laws have made it more difficult to file for bankruptcy. Plus let’s not forget the implications and the cost of filing for bankruptcy. Bankruptcy statistics clearly show there is an increase in large proportions of individuals filing for bankruptcy.

These statistics are normally complied by the administrative office of the U.S. courts. They are done quarterly with each quarter ending December, March, June and September. According to bankruptcy statistics released earlier this year, chapter 7 filings have increased 43%. Also on the increase are non business bankruptcies which have risen 31%.  On the other hand business bankruptcies have risen 54%. This increase is blamed on the fact that we are a society that is hooked on material things even when we have the inability to cater for them. If by some misfortune we are caught by an emergency that needs financial resources, we get into debt while trying to come up with the money.

This digs us into a hole that is very difficult to get out of. Most families that usually file for bankruptcy do so for a number of reasons. The leading cause are jobbing loss, medical problems and credit card debt. According to bankruptcy statistics, credit card debt can be avoided if people just have discipline and learn how to use cash when making purchases. It is a very easy trap to get into because you do not actually see how much you are spending at any given time and you end up spending more than you earn.

According to the demographics the average age of people filing for bankruptcy is 38 years. According to The Fragile Middle Class: Americans in Debt by Elizabeth Warren, 44% of filers are couples, 30 % are women filing alone while 26% are men filing on their own. In addition, two out of three people who have filed have suffered a job loss. The states with the highest bankruptcy rates are Alabama, Georgia, Tennessee, and Utah.

Article Source: http://www.articlesbase.com/finance-articles/bankruptcy-statistics-1170442.html

About the Author

Mercy Maranga writes content on Finance and Debt Management. Visit her site here for more information on Finance and how to effectively Manage your debts. Bankruptcy

How Does Chapter 7 Bankruptcy Deal With Small Business Debt In Missouri And Illinois?

Author: Jim Brown

Starting and operating a small business in Missouri and Illinois is not an easy task, especially in this economy. Fortunately, bankruptcy may be an option for some business owners. The debt involved in a Chapter 7 bankruptcy is divided into two categories: dischargeable and non-dischargeable. Dischargeable debts, which include credit card debt, personal loans, medical bills, and most income tax debts more than three years old, can be eliminated through bankruptcy. Non-dischargeable debts, however, cannot. Those debts include student loans, alimony, child support, and income tax debts less than three years old.

So, where does small business debt fall? If you are filing Missouri or Illinois Chapter 7 bankruptcy to stop harassing creditor calls, get credit card debt help, or stop a wage garnishment, your debt must be primarily consumer debt. Chapter 7 bankruptcy discharges your personal obligation to pay a small business debt, if you are eligible. Does that mean that you can assume your small business debt is lost and gone forever? Not necessarily. Depending on how your business is structured, creditors may still take action to collect the debt from the business. Filing a chapter 7, however, does protect your personal interest in the debt; and since most lenders require small business owners to make a personal guarantee on any loan, this could be a great move to get yourself out from under your crushing debt.

The best move would be to contact a St. Louis Missouri or Belleville Illinois bankruptcy attorney who is experienced in handling small business debt in a bankruptcy case. Normally I recommend finding the best attorney in your area but, if you are filing bankruptcy as a small business owner, finding the best attorney in your area is absolutely critical. You may even be able to keep your small business with a Chapter 13 bankruptcy.

The roots of the American economy all lie in small business. Following your dreams to open a small business is not always an easy process. But, luckily, there are Missouri and Illinois bankruptcy lawyers who can help you keep your dream alive while also helping you handle the debt you?ve incurred in the process. How do you know when you’ve found the best bankruptcy attorney in your area? Most attorneys offer a free consultation but the best attorneys will offer you free information before you even step foot in an office. Look for an attorney who offers you free articles, blogs, and even free publications to help you understand how bankruptcy can help you.

Article Source: http://www.articlesbase.com/law-articles/how-does-chapter-7-bankruptcy-deal-with-small-business-debt-in-missouri-and-illinois-1811695.html

About the Author
Missouri Bankruptcy attorney James Brown has been working to relieve the debt of hard-working American families for over 15 years. He has dedicated his career to educating consumers about options for debt relief and has released 5 publications, including, “Get Out of Debt: Secrets Your Creditors Don’t Want You to Know.” You can request a free copy at http://www.castlelaw.net

How To Rebuild Your Credit Rating After Bankruptcy

Author: figowang

Bankruptcy attorney Benjamin Ginter runs the Law Offices of Benjamin J. Ginter in Cranford, New Jersey. Here, he says that it is possible for people who file for bankruptcy to rebuild their credit rating.

You may despair at the thought that you will never get credit again after filing for bankruptcy. But the truth is far from that. Your bankruptcy can be erased from your record after 7 to 10 years’ time.

How to Rebuild Your Credit

Your credit report is based on many factors, which include your income and the debt you acquire after the bankruptcy. It is also based on whether or not you are paying your existing debt on time.

If you try to rebuild your credit, you must pay your bills and existing debt on time. When you use a credit card, you must pay the balance in full each month. If you need a car, you can get one. But make sure you make payments on time, as delayed payments will hurt your credit. Just be optimistic. Over time, your credit will improve, as long as you play by the aforementioned rules.

Different Credit

In my opinion, there is good credit and bad credit. Bad credit is like a department store card, such as Target or Bloomingdales, known as an unsecured credit card. Good credit consists of things like financing a car or your mortgage.

When you have a mortgage and you make payments each month, your credit will go up. But if you open many department store cards and you have open credit limits, that could negatively affect your credit.

What to Notify Creditors

The bankruptcy court will notify all creditors of the following items by email:

• The filing of the bankruptcy
• The case number
• The automatic stay
• The name of the trustee assigned to the case (if filed under Chapters 7 or 13)
• The date set for the meeting of creditors
• The deadline, if any, set for filing objections to the discharge of the debtor and/or the discharge of specific debts
• Whether and where to file claims

The exact information in the notice may be slightly different depending on the chapter under which the case is filed. 　

Article Source: http://www.articlesbase.com/bankruptcy-articles/how-to-rebuild-your-credit-rating-after-bankruptcy-1885367.html

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figo

Arizona Foreclosure: How Bankruptcy Can Help You

Author: Steve Engram

If you’re like thousands of other Arizonans, you’re in danger of losing your home to a bank foreclosure. Fortunately, many are discovering the solution in what may seem the unlikeliest of places ? bankruptcy. Losing everything you own is just one of many Arizona bankruptcy myths encountered by Arizona Bankruptcy Now legal counsel over the past 15 years. In fact, with the help of an experienced Arizona bankruptcy lawyer who understands the law, you’ll likely keep your home, as well as your vehicle and other prized possessions too!

In most cases, homeowners facing potential Arizona foreclosure have been hard hit by adjustable rate loans. They started out with low payments they can afford, only to see the cost of their monthly mortgage rise beyond their reach. For many, the problem is multiplied by credit card debt and medical bills. Once they’ve exhausted all their options, hundreds of hardworking Arizonans just like you come to the same conclusion every single month ? they need the help of an Arizona bankruptcy attorney.

The bankruptcy process can be complicated and stressful. That’s why it’s imperative you seek the counsel of an experienced bankruptcy attorney who’s done it countless times ? not just anywhere, but here in Arizona where you live, as bankruptcy laws vary by state.

First, your attorney will help you decide which form of bankruptcy may be right for you. Chapter 7 eliminates much of your debt, including credit card and medical bills, freeing up extra money for you to make your monthly mortgage and car payments. Chapter 13 requires you to pay back what you owe over a specified period of time. It may also eliminate more types of debt than Chapter 7. Only an experienced bankruptcy attorney will know which option is best for your unique situation.

When it comes time to file your bankruptcy petition with the court, your lawyer is equally essential as paperwork errors mean revision and resubmission. It is critical to provide the court with a schedule of your assets and liabilities within 15 days of filing the petition. Miss this deadline, and the court dismisses the case.

If you are already in the middle of a bank foreclosure on your home, be sure to file your petition with the court before the foreclosure sale date on your property. That means consulting with an attorney as soon possible to allow enough time for preparation.

When it comes to keeping the home you’ve worked so hard for, your toughest decision could also be your smartest. Within months of your bankruptcy’s completion, you can start rebuilding your credit again. You can get the fresh start that bankruptcy law is intended to provide. To find out which form of bankruptcy may be right for you, contact an experienced bankruptcy lawyer for a free consultation.

Article Source: http://www.articlesbase.com/mortgage-articles/arizona-foreclosure-how-bankruptcy-can-help-you-474959.html

About the Author

Attorney Kirk Guinn advises and assists individuals and families statewide in Arizona with legal questions and concerns relating only to bankruptcy and real estate. He answers all questions and knowledgeably explains the tough questions that exist about bankruptcy and the new laws associated with it.

Low Cost Bankruptcy — How To Find An Affordable Bankruptcy Solution

Author: Roilee Mandeville

A low cost bankruptcy is essential for many people struggling with financial situations. Cutting costs everywhere, including cutting back on the cost of bankruptcy lawyer, is one of the most important steps to regaining financial balance. There are a number of tips for finding cheap bankruptcy solution that is right for you.

Filing for bankruptcy is a process that you can take on yourself. You will need to get an application for bankruptcy from court and fill it out completely. Keep in mind that some of these forms can run up to twenty pages. Remember that bankruptcy has long-term effects on your credit score, your financial situation and even legal consequences. This is one of the reasons that many people avoid filing for bankruptcy on their own even though there are cheaper bankruptcy alternatives.

Finding a Low Cost Bankruptcy Solution

Understand the costs of bankruptcy — there are some expenses that cannot be avoided but that may be able to be lowered through negotiation. There are also some expenses that you need to be aware of before starting the bankruptcy process so that you can begin saving for them.

1. Required credit counseling — the court wants to be sure that you will be able to stay out of financial trouble in the future.

2. Filing fees — there is no way around these fees so be sure that you plan on saving the $274 up to $299 that it will cost to file for bankruptcy.

3. Attorney fees — this is the amount that you will pay your lawyer and it is one of the easiest ways to help cut expenses and end up with an affordable bankruptcy. Take some time to call different lawyers and law offices to see which one will meet your needs at the price that you can afford.

You can also find some help getting a low cost bankruptcy on the internet. Visiting bankruptcy and legal websites will help you to understand the process and prepare for expenses. You can also research potential lawyers or law firms to see how other clients rate their experiences. Financial websites can help you to better understand the long-term ramifications of bankruptcy and give you tips on getting your financial situation under control for the future.

Take a moment to find a website that offers a free case evaluation to help you find the right bankruptcy lawyer in your area for your needs. You can use that information to choose the lawyer that will guide you to your cheap bankruptcy filing or you can let the information go. Make sure to look for the “no obligation to hire” guarantee. It’s better if you don’t need to give any credit card information just to get you free case evaluation.

Article Source: http://www.articlesbase.com/bankruptcy-articles/low-cost-bankruptcy-how-to-find-an-affordable-bankruptcy-solution-1459117.html

About the Author

Roilee Mandeville maintains a website dedicated to information on how to quickly find a cheap bankruptcy attorney in 10 minutes or less. You will learn a better way to research, compare prices and services when you visit http://www.BankruptcyLawyersAndAttorneys.com/ today. For a limited time he’s also giving away FREE e-books about saving money, debt, and a bankruptcy audio guide to help debtors deal with their financial problems. The free download will only be available for a few days so hurry and get them now!

Alternatives To Bankruptcy

Author: Natalia Kobseva

As anyone who has seriously examined Chapter 7 bankruptcy protection knows all too well, filing bankruptcy may be the absolute worst thing that borrowers can do to improve their financial position. For desperate folk suddenly realizing that there is little they can do on their own to achieve debt relief, bankruptcy might seem like an attractive possibility. After all, from our earliest memories, Americans are taught to respect bankruptcy as the (for whatever reason) dignified end to debt crises. Whether playing board games or watching cartoons, we’re taught that bankruptcy is just what is supposed to happen once any borrower has debts that they can no longer responsibly manage. In our culture, bankruptcy is simply expected to be the final debt solutions to personal economic strife. Even as the nature of consumer debt changes from hospital bills and department store accounts to the burdens of credit cards too easily granted and too quickly filled to their limits, bankruptcy maintains a mythic allure as an all-inclusive cleanser for financial woes.

Much as the debt protection of bankruptcy may have seemed a godsend for the generations that came before, there are now any number of new bankruptcy alternatives available for those debtors who have faced financial misfortune. More to the point, once a consumer takes time to fully analyze the Chapter 7 bankruptcy program, they may very reasonably wonder whether or not bankruptcy would be the correct choice for any debtor regardless of their own situation. Successfully filed and discharged, bankruptcy protection could indeed offer consumers new beginnings. In the best scenario, the fortunate borrowers could even start their financial lives over from ground zero, but that is only after they have suffered a harrowing ordeal that risks the utter ruination of their credit rating as well as the potential loss and seizure of any even vaguely valuable possessions.

The relief that people may feel when entering the bankruptcy program is understandable, really. Given that most borrowers seriously considering bankruptcy have already had to deal with (the sometimes hourly) harassment from bill collection agencies and watch their mailbox fill to bursting with past due notices from credit card companies, it is not that surprising that the average consumer – struggling to pay their credit cards and other debts – would jump at the chance to have a specialist take over their affairs. The very idea that debtors would no longer be held responsible for their actions alone comes as a sort of salvation that impels otherwise cautious heads of household to essentially hand over the reins of their economic futures. Certainly, the bankruptcy lawyers charging more and more outrageous fees are not going to argue against what may as well be thought of as their own product. Despite the amount of time the lawyers may spend with their clients (they are paid by the hour, as you probably know), very few attorneys will spend even five minutes counseling borrowers about exactly what they are getting themselves into. Eliminating unsecured debts (credit cards, primarily, as these things tend to go) should be a priority, but wise debtors must recognize the limitations of bankruptcy protection under the current statutes. Above all else, they should know not to trust their attorneys for advice beyond their specialty.

To learn more about Federal Debt Relief Program and how to get started, please visit DebtRelief.bz

Article Source: http://www.articlesbase.com/advertising-articles/alternatives-to-bankruptcy-723421.html

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