Monday, February 19, 2007

New legal blog link

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Saturday, February 17, 2007

Chapter 13

Chapter 13 Stop mortgage foreclosure
Keywords: chapter 13, bankruptcy, foreclosure, consolidation, chapter 7, mortgage, mortgage default, credit cards, medical bills, interest rate, ARM, adjustable rate mortgage
Stop Foreclosure
Yes, you can save your home!

Using the chapter 13 can strategically help you cure your mortgage default, protect your equity and eliminate your other debts to help you right the ship.

Several years ago, we saw a boom in mortgage lenders offering low adjustable rate mortgages (ARMS) 100% to 110% mortgage loans, and no money down mortgages.

Today, we have seen these ARMS increase from 5% to 8%, 9% or more depending on the lender. Homeowners are being bombarded with a mortgage payment that is almost double than it had been previously before the interest rates have started to rise.

What is a homeowner to do? With the soft real estate market, homes have not appreciated in value, or not enough to allow homeowners to refinance and use some of their equity to help with the higher rates.

Chapter 13 is an option. In a nutshell, consumers can file chapter 13 which will let them catch up on their mortgage payment, interest free. It can also consolidate their other financed items and often save money on the interest rates. Currently, debtors can pay cars, furniture and jewelry back at prime rate of interest or prime +2, or +3. shows a current prime rate of interest at 8.25%.

Consumers can also consolidate their credit card debt, medical bills and other consumer debts and pay them back, with little or now interest, and often can pay them as low as 10 cents on each dollar owed!By doing this, consumers can cure any mortgage arrears, pay off their secured debt for vehicles and for big ticket financed items, while eliminating their consumer debt. A Chapter 13 bankruptcy can run from 3 to 5 years. This depends on your monthly household disposable income. There are several recent changes to the Bankruptcy Code that can affect this repayment plan. These changes were part of the BAPCPA reform. Therefore, it is crucial to discuss with an experienced bankruptcy lawyer about the various law requirements and qualifications based on your unique situation.

For instance, let’s say Johnny Consumer owns a home worth $100,000 in Chicago, Illinois. Let’s say he has a $70,000 mortgage with the bank, but has fallen $6,000 behind and the mortgage company has started a foreclosure. Johnny was recently out of work do to an injury on the job. He has just went back to work, and sees no way to catch up $6000 any time soon. He has $10,000 in medical bills. He owes $3000 on his car. For our example, let’s say that Johnny makes $3000 per month and takes home about $2100. His mortgage is $700 a month, his car note is $300 and he has $67 left at the end of the month to use to try to catch up with the medical bills and the mortgage arrears.

At first glance, there is no way he can manage this on his own. Under a chapter 13, Johnny can make a monthly payment of $367 to the court. This will allow him to catch up on the mortgage, pay off his car note, and eliminate the medical bills he has. This will only take 3 years. It will protect all of the equity he has in his home and stop the foreclosure!

Therefore, if you are looking to stop foreclosure, and have steady income, Chapter 13 could be a great tool to use. You can always refinance or sell your home while under Chapter 13 if you wish to pay off the bankruptcy and move on with your life. The Chapter 13 stops the foreclosure immediately. Often, your only other option would be to refinance, or enter into a repayment agreement with your mortgage company. All too often, they want a double payment each month until you can catch up. If you had that kind of disposable income, you probably wouldn’t be in this situation in the first place.

Contact an experienced Chapter 13 bankruptcy attorney today to discuss these options. You
don’t need a home to file either. Often consumers just wish to get a better deal on their old car note, consolidate their credit card debt to eliminate the high interest rates…or wish to consolidate their old student loans and parking tickets. There is a way to pay back old IRS debt as well as pennies on the dollar.

Pick up the phone and call me at 312-427-7400 and I’ll be happy to give you a free consultation by phone or schedule an appointment at one of our convenient
office locations
We also have a free online legal evaluation to try as well.

The time to act is now if you want to save your home from foreclosure.

Thursday, February 08, 2007

Feb 1 - Updated census bureau median income in Illinois

For Illinois Bankruptcy filings: Census Bureau Median Family Income By Family Size

(Cases Filed On and After February 1, 2007)

The following are the for ease of use in completing Bankruptcy Forms B22A and B22C.

1 EARNER: $42,995
2 PEOPLE: $54,599
3 PEOPLE: $64,184
4 PEOPLE: $74,705*

* Each additional person in the household gets $6300 additional allocation.

information provided by the US Trustee, Department of Justice.

Now, even if you are above the median income, you may still qualify for chapter 7. Contact your bankruptcy lawyer for more info, or if you are seeking legal advice, shoot me an email or phone call and I'll be happy to review your specific situation.
Terry Leeders
Law offices of Leeders & Associates, Ltd.

Bankruptcy - Real Estate - Divorce - DUI - Immigration - Personal Injury - Small Business

Friday, February 02, 2007

Foreclosure and bankruptcy

My clients often call and ask me how long does a foreclosure take?
How much time do I have in my house?
Or how much time do I have to file Chapter 13 to stop the foreclosure?

Excellent questions. The generic answer is anywhere from 6-9 months from the time the foreclosure started. The party being foreclosed upon will get notices and timelines of events as they occur to get specific dates. The foreclosure attorney's office can also provide the dates to you...if they will even take your call!

Therefore, I have posted the Illinois Statute that sets out the time frame. Remember, each state differs. Please contact me if you need help to stop foreclosure, time is of the essence, and the foreclosure will not stop until a bankruptcy is on file.

info below as found on

State Statutes

Illinois Mortgage Foreclosure Law (IMFL), 735 ILCS 5/15–1507,1508; 1602

Foreclosure Process

The entire process in Illinois takes, on average, from the filing of the complaint to the eviction by the sheriff, nine months. Foreclosure defense in court is seldom successful in defeating the foreclosure action but may prolong the foreclosure by as much as 24 months. If the property is not residential or is abandoned, the process can be substantially shortened. The following is an outline of a typical foreclosure case:

  • Default
  • Filing of Foreclosure
  • Personal Service of Summons
  • Foreclosure Judgment and Order of Sale
  • Reinstatement Period Expires (90 days after personal service)
  • Redemption Period Expires (7 months after personal service or 3 months after judgment, whichever is later)
  • Foreclosure Sale
  • Foreclosure Sale Confirmed
  • Right to Possession Expires (30 days after foreclosure sale confirmed)
  • Eviction by Sheriff of Named Parties
  • Recording of Foreclosure Deed

Thursday, February 01, 2007

Bankruptcy Chapter 13 Law update

Projected Disposable Income is the Same as Disposable Income
(Form B22C Controls)
In re Farrar-Johnson, WL 2662709 (Bankr. N. D. Ill. 9/15/06.)

Under Chapter 13 where a debtor is above the median income, section 1325(b)(3) makes clear that Schedule J has no role in calculating disposable income when determining what the monthly plan payment will be. Line 58 multiplied by 60 will give you the amount needed to be paid to the unsecured creditors when calculating the plan.

Another, possibly bigger blow to debtors is found in the decision In re Wiggs, 2006 WL 2246432 (Bankr. N. D. Ill. 8/04/06).
If a debtor who does not make a vehicle note or lease payment cannot take the ownership/lease deduction on Lines 28-29 of Form B22C.
Finding §707(b)(2)(A)(ii)(I) “clear and unambiguous,” the court stated that the word “applicable” "modifies the amounts specified to limit the expenses to only those that apply” (Citing In re McGuire, 342 B. R. 608 (Bankr. W. D. Mo. 2006)). The court also reasoned that the court should look to the statute rather than the IRS guidelines.

Obviously, you should speak to an attorney to help you with these issues.
Contact me at