Wednesday, April 30, 2008

Active Duty -Bankruptcy reform bill

House Panel Markups Focus on Bankruptcy Relief for Active Duty Military
The House Judiciary Committee today will mark up H.R. 4044, a bill that would exempt military reservists called to active duty and certain others from application of the means test in chapter 7.

Stay tuned for further details.....

Tuesday, April 15, 2008

filing multiple bankruptcy cases

Subject: filing chapter 7 again
Question: Hello,

I want to know if I was discharged from a chapter 7 in 2003 or 2004, can I in 08 file again for a chapter 7 due to a hardship, it would be for a car for 20,500 i also have a credit card that i probably would keep with limit at 1,000 and payments are only 30 a month. I'm also a authorized user for my mom's AMEX and the is on my credit-what will happen to that? I just can't afford paying the vehicle it anymore. I have tried to trade and sell and because of the neg equity and economy no wants to buy. I live in Georgia, is this possible? What is my next step? Please help! Thanks in advance

Chapter 7 is only available again 8 years from the date you filed your last chapter 7. So, here, you would be able to file Chapter 13. With a chapter 13, you can pay back anywhere from 10% and up based on your income and your assets. Speak to a local attorney to help calculate your monthly payment.

Bankruptcy and Divorce

Subject: Divorce Decree Judgment and Bankruptcy
Question: My husband ex wife has done everything in her power to make our life miserable. I have a couple questions. Fist.. can you amend a bankruptcy 3.5 years after it has taken place if you forgot a judgment?

My husband got mailed papers yesterday saying that his ex wife is suing him for a judgment that was in their divorce decree. Two years after the divorce was final, my husband filled bankruptcy. I have gone through the entire bankruptcy document and can't find this judgment at all included in the bankruptcy. Does this mean he has to pay it or can a bank. document include items that were forgotten since it was before the actually bank. took place?

Couple issues here:
1. you can bring a motion to reopen a case, there is a court fee to do so. Then it will be up to the judge to decide, based on reasonable and necessity. I have seen most of them granted here in Illinois.

2. Divorce debts: 1. Generally, divorce debts are not dischargeable in bankruptcy.
3. Divorce decree: the divorce decree will control, say there was a joint debt, that the decree said your husband was to be responsible for. Even if he files bankruptcy, the lender can then go after the cosigner, here, his ex. She then can enforce the divorce decree to still get your husband to pay the debt.

Hope that helps clear up the situation.

Selling home after bankruptcy

selling home Question: How long after I have been discharged can I sell my home
Once you receive your discharge, you can sell at any time.
If you need to sell during your case, you can, if you get approval from the judge.

Discharging income taxes in bankruptcy

Subject: back taxes
Question: Unfortunately I had to draw out from my retirement money due to my ill mother, whom has since deceased. I owe from 1999 thru this current year. I tried to do offer in compromise but could not come up with the money needed to get started.
I'm just strapped for money and am scared that the IRS will garnish my wages. Can you give me some insight please

There are loopholes to discharge taxes. The tax must be 3 years old, filed on time and accurate, and you just owe. If they were inaccurate and corrected more than 2 years before your bankruptcy case, then they will be dischargeable as well. Anything less than 3 years old will not be discharged.
This is a narrow loophole, so speak with a bankruptcy lawyer to make sure bankruptcy would help your situation.

Reaffirming a mortgage

A popular question I get is regarding being on the hook for a mortgage after bankruptcy.

Here is a recent question I received:

I filed Chapter 7 Bankruptcy last year and managed to hold on to my home. I checked a box in the bankruptcy paperwork stating that I wanted to hold on to my residency. I am falling behind on my payments and want this debt to be included on my bankruptcy. Is this a reaffirmation agreement by the Court. Or is there more to it?

A reaffirmation is a document signed by the creditor, the debtor, and usually the debtor's attorney. This states that the debtor will continue payments on the debt after bankruptcy. It keeps the debtor on the hook, thus allowing the debtor to keep the asset. This document is filed with the court, and is usually reviewed by the court to verify that there is no undue hardship on the debtor. It sounds like you are referring to your Statement of Intention, that you intend to sign a reaffirmation agreement to keep the home. If you do not sign a reaffirmation, you are not liable for the debt, and the creditor can take the steps necessary to collect the collateral back (here, foreclose.) Check with your lawyer to confirm if you have signed a reaffirmation agreement with the lender.

Wednesday, April 09, 2008

Illinois Attorney General Sues

Below is an article I saw on Crains Chicago business.

Madigan sues citing mortgage scam

By: Lorene Yue April 08, 2008

(Crain’s) — Attorney General Lisa Madigan filed a lawsuit against a Chicago company for allegedly scamming financially troubled homeowners by posing as a mortgage rescue firm.

Victory Consulting & Investments Inc. is accused of violating the state’s Consumer Fraud and Deceptive Business Practices Act. Walter C. Armstrong, the company’s general manager, was also named as a defendant in Ms. Madigan’s suit.

The suit claims that at least five homeowners lost their homes through Victory Consulting’s alleged deceptive practices.

“The last thing desperate homeowners on the verge of losing their homes need is a so-called mortgage rescue firm that does little more than separate homeowners from their money,” Ms. Madigan said in a statement.

Neither Mr. Armstrong nor a Victory Consulting representative could be reached for comment.

The suit, filed in Cook County Circuit Court, marks the 12th time Ms. Madigan has pursued legal action against a firm claiming to offer mortgage assistance.

The suit claims Mr. Armstrong and Victory Consulting employees posed as clergy members to gain the trust of homeowners struggling to make mortgage payments. Customers were solicited through advertisements or found through foreclosure notifications filed with Cook County, the suit said. ........

This is good news. My clients have had some crazy dealings with people claiming to help them with their mortgage problems, only to have to resort to filing bankruptcy to resolve their problems. Some waste hundreds and thousands of dollars with these companies. I recently attended a meeting with the US department of Justice and they laid out a strong stance on mortgage fraud. They are investigating all sorts of angles and are cracking down on real estate fraud heavily.

As always, check with the Better Business Bureau to investigate if these are legit companies, and read up on the number of complaints filed.

Tuesday, April 08, 2008

Fresh Start Forms Debt repayment plan

A colleague of mine, has developed a useful way to pay down debt without filing bankruptcy.
Check out his info here.

I'd like to share this video with you. It's called "10 Minutes to financial freedom"
I guarantee, it will change the way you look at debt forever.
Feel free to share this with co-workers, friends and family.
Check out this video

Fresh Start Forms - Debt Reduction Program

For more information on our upcomming events, visit their events calendar at:

US Trustee moved

The US Trustee has moved their office in Chicago.

The new address will be:
Office of the United States Trustee
Dirksen Federal Court House
219 South Dearborn Street
Room 873
Chicago, IL 60604

The main telephone number (312) 886-5785 and fax number (312) 886-5794 will
remain the same as will all individual employees’ numbers.

Cook County Chapter 7 341 hearings will now be held at 219 S. Dearborn St. Room 800 in the Dirksen Federal Building as well.

Thursday, April 03, 2008

Mortgage Relief

Good News.

I recently attended a meeting presented by several prominent bankruptcy Judges in Chicago, IL. They discussed numerous topics on the current laws, rules etc. They all seemed to be in agreement that the proposed changes to the bankruptcy code that are pending in Congress currently, namely -reduction of mortgage interest rates and reduction of over financed mortgages - would be beneficial to the economy. They feel that the bankruptcy code is the correct place, since the tools are in place to enforce it and implement these changes...aka....ME!

What is being considered is allowing a debtor who has an extremely high Mortgage ARM, be able to modify that term to a fixed rate loan. They also may allow us to cram down and strip off mortgage amounts above the property's fair market value.

The judges indicate that there will be strict guidelines - such as how low we can reduce the rate, how long we can reduce the rate, and having a window in which the loan had to have been incurred or refinanced. So, now, the task is yours to write your senators and congressmen and women to say that you support this legislation.