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Bankruptcy Counseling Certificate

July 28, 2010 By 10 Comments

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Fail Out of Bankruptcy: What Happens When Debtors Cannot Repay Debts?

Author: Simon Volkov

Fail out of bankruptcy refers to people who have filed for Chapter 13, but are unable to adhere to their repayment plan. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 mandates debtors must repay a portion of debts unless their income level is less than their states’ median income. Under BAPCPA requirements, debtors must contribute a large percentage of disposable income toward debt repayment.

When individuals fail out of bankruptcy, creditors can file a petition through the court requesting the bankruptcy be dismissed. When Chapter 13 bankruptcies are dismissed, debtors lose all protection from the court and creditors can commence with collection action, including foreclosure.

Oftentimes homeowners will file for Chapter 13 bankruptcy to avoid foreclosure. If borrowers are able to maintain their regular mortgage payment and adhere to their bankruptcy repayment plan, Chapter 13 can be a saving grace.

Unfortunately, most homeowners fail to understand that in addition to maintaining monthly mortgage payments, they must also repay mortgage arrearages. Homeowners who are already struggling to make ends meet are seldom able to pay additional funds to prevent foreclosure.

When homeowners fail out of bankruptcy mortgage lenders can initiate foreclosure proceedings at the point where they were suspended when the bankruptcy petition was filed. For instance, if foreclosure would have occurred within 30 days, the bank can foreclose on the home within 30 days of the borrower missing a Chapter 13 payment.

When debtors are unable to adhere to their chapter 13 repayment plan they should immediately contact their bankruptcy attorney. If the debtor has encountered a temporary financial setback, the attorney can usually convince the bankruptcy Trustee to work with the debtor to get back on track and avoid failing out of bankruptcy.

Filing for bankruptcy protection can help debtors reorganize their debts and get back on track with finances. The new bankruptcy laws require debtors to undergo credit counseling through an approved agency either prior to or during bankruptcy proceedings. Debtors must present a credit counseling certificate and proposed repayment plan to the bankruptcy judge.

Before filing for bankruptcy, debtors should investigate debt reduction alternatives. These might include debt consolidation, debt settlement, credit counseling and budgeting.

Bankruptcy filings remain on credit reports for ten years. Debtors who fail out of bankruptcy are rarely able to obtain any type of credit. Those who do are certain to pay high interest rates and have exceptionally low credit limits.

Personal bankruptcy can adversely affect other areas of life. Individuals with poor credit and bankruptcy filings typically have to pay more when renting a home or apartment. Landlords oftentimes require high-risk renters to pay first and last month rent, along with a security deposit.

Utility companies will charge security deposits which can be held for two or more years. Debtors are often forced to purchase automobiles through “Buy Here Pay Here” lots and end up paying much more for the vehicle than it is worth. Many banks will not allow consumers with bankruptcy filings to open checking or savings accounts. Insurance companies can charge higher premiums for automobile and home insurance.

Take time to become educated about the process of bankruptcy and the ramifications of failing out of bankruptcy. While it can be tempting to file bankruptcy to stop creditor harassment, the long term affect can be devastating.

Article Source: http://www.articlesbase.com/personal-finance-articles/fail-out-of-bankruptcy-what-happens-when-debtors-cannot-repay-debts-1224763.html

About the Author

Simon Volkov is a California real estate investor who specializes in offering solutions to individuals who fail out of bankruptcy and those facing foreclosure. If you can no longer adhere to your Chapter 13 repayment plan or in fear of losing your home, submit your property information via the “we buy houses” form at www.SimonVolkov.com today.


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Filing Bankruptcy Online Attorney

July 26, 2010 By 10 Comments
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Considerations Before Filing Personal Bankruptcy

Author: Jon Arnold

For some people, filing personal bankruptcy is the only way they can find their way out of overwhelming debt. Whether your debt is the result of not being able to pay your bills because you were laid off work or the result of poor financial decisions, there are a variety of things to consider before actually filing personal bankruptcy. When you first consider to file bankruptcy, you will need to decide if Chapter 7 or Chapter 13 bankruptcy will fit your needs better. As well, there are a variety of debts that cannot be included in your bankruptcy settlement.

Chapter 7 bankruptcy requires that a bankruptcy trustee sell off your nonexempt assets so that your debt can then be repaid. With Chapter 7 bankruptcy, there is the risk of losing your home, along with a majority of your other personal items. Therefore, before filing Chapter 7 bankruptcy, it is important you have a full understanding how Chapter 7 works. When it is all said and done, if you file Chapter 7 bankruptcy, you will no longer have your overwhelming debt.

Chapter 13 bankruptcy varies quite a bit from Chapter 7 bankruptcy. Chapter 13 bankruptcy requires that a portion or all of your unsecured debt is repaid. A repayment plan is established through the bankruptcy court. Payments can be made over a period of 36 months to 60 months, depending on the amount of the debt. The repayment amount is equal to or greater than the amount would be should you have chosen to go with Chapter 7 bankruptcy and liquidated your assets.

Although personal bankruptcy may seem like a great way to break free of your overwhelming debt, there are some types of debt that cannot be included when filing bankruptcy. Debt that occurs from student loans, taxes, child support, spousal support, criminal fees and charges made on a credit card 40 days before filing bankruptcy cannot be included in personal bankruptcy.

It is important that you realize filing personal bankruptcy will have a negative effect on your credit rating. This effect will last for approximately seven to ten years, depending on what type of bankruptcy you file. Although your credit score will be affected, you can still obtain credit after you have filed bankruptcy. However, the credit that you will be able to obtain will carry a higher interest rate than it would if you didn’t have a bankruptcy on your credit.

Filing bankruptcy can also have other negative effects. For instance, if you would need to obtain life insurance you may have a harder time obtaining a policy. Many car insurance companies are now charging a higher premium if you have a bad credit score. Many employees are now running credit checks. Therefore, if you have a bankruptcy on your credit, it may be harder to obtain a job. You may also experience psychological effects, such as depression.

For many, debt is a way of life. However, there are instances when the debt becomes more than you can handle. Personal bankruptcy is a way to help you deal with debt that you can no longer pay. If you are looking to file bankruptcy, it is important that you have a full understanding of the way it works, as well as the lasting effects bankruptcy can have.

Article Source: http://www.articlesbase.com/finance-articles/considerations-before-filing-personal-bankruptcy-283514.html

About the Author

For more insights and additional information about Filing Personal Bankruptcy as well as getting a free bankruptcy evaluation from an attorney local to you, please visit our web site at http://www.bankruptcy-data.com



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Info On Bankruptcy

July 26, 2010 By Leave a Comment

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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

About the Author

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.

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Corporate Bankruptcy Massachusetts

July 22, 2010 By 6 Comments
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Personal Vs. Corporate Bankruptcy

Author: Robbi Gunter

Similar to an LLC, when corporations liquidate under chapter 7 of the U.S. bankruptcy law, it includes only the business assets. The owner is totally exempt from personal liability in regards to any corporate debt, excluding the loss of value of any shares. Creditors are repaid from the proceeds of liquidation. Before equity receives anything, debts must be paid in full.

Chapter 11 of the U.S. bankruptcy law states that all assets are kept by any organization that reorganizes and continues operation, while most creditors receive partial payment. Investment decisions become less efficient in reorganization because equity over-invests in risky projects

In corporate bankruptcy the goal is to obtain enough repayment to creditors that lenders will continue to lend, at least to other borrowers. Inefficient investment decisions made by equity managers in prioritizing decisions, limit the company’s return. Filtering failure is a result of inefficient bankruptcy decisions. Both of these factors are influential to creditors, which may cause them to raise interest rates or reduce the amounts they are willing to lend, depending on whether the company’s return is lowered by inefficient decisions.

Sometimes a corporation is financially solvent, yet strategically defaults on their debt. When the firm is successful, owners repay. They default if the firm fails, with filtering failure and inefficient liquidation.

Slavery is no longer used as a penalty for personal bankruptcy, so individuals can only reorganize, even though it is most commonly referred to as liquidation. When individuals claim bankruptcy, their personal assets are liquidated in order to repay any debt and their assets are divided among the creditors. There is a limit to the amount of assets that debtors must use to repay. Debtors can keep a certain amount of financial wealth and post bankruptcy earnings. “Fresh start” refers to 100% exemptions for post-bankruptcy earnings, limiting the debtor’s obligation to repay. Most unsecured debts are discharged. In personal bankruptcy, debtors can get partial consumptions insurance. Prior to filing for personal bankruptcy, debtors can convert non-exempt assets as bank accounts into home equity. Wealth for debtors who are homeowners are protected by high homestead exemptions.

Article Source: http://www.articlesbase.com/small-business-articles/personal-vs-corporate-bankruptcy-216499.html

About the Author

Robbi Gunter is a staff writer for Strong Business Credit – a free educational web resource for small business owners needing business loans and business credit cards.



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File Bankruptcy Creditor Claim

July 17, 2010 By 10 Comments
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How to File Bankruptcy and Comply With New Bankruptcy Laws

Author: Simon Volkov

Are you perplexed about how to file bankruptcy? If so, you aren’t alone. The biggest source of bankruptcy confusion stems from new bankruptcy laws enacted by Congress in 2005. Known as the Bankruptcy Abuse Prevention and Consumer Protection Act, BAPCPA placed multiple restrictions on debtors and require all petitioners to obtain credit counseling.

Comprehending the process of how to file bankruptcy generally requires help from a bankruptcy lawyer. While there is no legal requirement for petitioners to obtain legal representation, few people can get through the process alone. BAPCPA requirements could cause debtors who file without legal assistance to have their bankruptcy petition dismissed or rejected.

Six bankruptcy chapters exist and include Chapter 7, 9, 11, 12, 13 and 15. Individuals filing personal bankruptcy must file for Chapter 7 or 13. The remaining chapters are used for businesses and corporations, as well as commercial fishermen and farmers.

In previous years, debtors sought financial relief under Chapter 7. Often referred to as liquidation bankruptcy, debtors must sell valuable assets to repay outstanding debts. Any amounts remaining are written off; giving debtors a clean financial slate. Some debts cannot be discharged through Chapter 7 including child support, pending lawsuits, government funded or guaranteed student loans, and delinquent state and federal taxes.

Under BAPCPA, the majority of debtors are required to file Chapter 13. Also known as reorganization bankruptcy, Chapter 13 requires debtors to repay a portion of their debts. In order to determine the amount of debt to be paid, debtors must undergo the ‘means’ test. This financial tool compares petitioners’ income to their states’ median income level. When income is equal to or greater than median income, debtors must file Chapter 13. If income is less than median income, debtors might be allowed to file Chapter 7.

Debtors who obtain authorization to file Chapter 13 must submit a repayment plan to the bankruptcy court for approval. Most Chapter 13 payment plans extend for two to five years. During the repayment phase debtors must contribute a large portion of disposable income toward repayment of debt. Additionally, debtors are prohibited from incurring new debts without court approval.

Chapter 13 payments often place a heavy burden on debtors which can cause them to fail out of bankruptcy. Failing out of bankruptcy will result in loss of court protection and allows creditors to petition to court to seek dismissal. When creditors petition the court for dismissal, a bankruptcy judge reviews the case to determine if debtors are eligible for Chapter 7. If the judge dismisses the bankruptcy petition, creditors can commence with collection actions, including home foreclosure.

The bankruptcy process requires debtors to submit their petition to the court. Afterwards, a 321 creditor meeting is arranged to allow creditors and debtors to discuss payment arrangements. Creditors are allowed to question debtors regarding the circumstances that caused them to file bankruptcy, as well as develop a repayment plan.

Creditors are not required to attend the creditor meeting. However, in order to have their claims included in the Chapter 13 payment plan, creditors must submit a claim through the bankruptcy court within 30 days of the meeting.

The final step of the bankruptcy process requires debtors to appear in front of the judge. The judge will review the proposed Chapter 13 payment plan to determine if it meets BAPCPA requirements. Debtors must present a credit counseling certificate to verify they have met counseling requirements. The judge can either approve the Chapter 13 payment plan; allow debtors to discharge debts under Chapter 7; or dismiss the bankruptcy petition.

Individuals in need of bankruptcy protection should explore information provided through the Department of Justice U.S. Trustee Program website at Justice.gov. Debtors can locate a list of approved credit counseling and debt education agencies, along with bankruptcy information, forms and resources.

Article Source: http://www.articlesbase.com/finance-articles/how-to-file-bankruptcy-and-comply-with-new-bankruptcy-laws-2340127.html

About the Author

Simon Volkov is a private investor who offers solutions to people facing hardships. He specializes in foreclosures, probate, promissory notes and helps people understand how to file bankruptcy. Learn more by visiting www.simonvolkov.comtoday.



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