Bankruptcy and Foreclosure Attorney Blog

No. Many times only one spouse is responsible for all of the debt. In this instance, it is probably wiser for that spouse to file for bankruptcy alone.

However, if there is shared debt, and the spouse that files for bankruptcy gets a discharge on that debt, the non-filing spouse can still be held wholly responsible. This even applies to 2nd mortgages or liens on primary residences.

If only one spouse files for Chapter 13, and the 2nd mortgage is stripped off after the debtor's final plan payment, the 2nd mortgage lender can still look to the non-filing spouse to recover the balance owed. If you have questions on whether or not you should file by yourself or jointly with your spouse, you should cntact an experienced bankruptcy attorney.

Continue reading " Does my Spouse have to file Bankruptcy with me? " »

Many Floridians are having their homes foreclosed on, but most citizens are unaware of when they actally have to vacate the property. When must a debtor/homeowner vacate?

Although a sale date is set for the home, the tenant may still occupy the property until the lender sues the debtor individually and gets a judgment against the debtor. Only then will the debtor be legally obligated to leave the property. Florida law sets out this procedure and iit s unique to many other state jurisdictions. Debtors in Florida have the opportunity to stay in their homes longer than most debtors from other states.

Continue reading " My House is Scheduled for Foreclosure: Do I have to leave the property? " »

Until recent, high foreclosure rates were attributed mostly to bad loans and overvalued property prices. However, the unemployment rates and job reductions are said to be the biggest causes for recent spikes in foreclosures. Everyone has been impacted in some way or the other with the recent economic decline.

The housing market has been impacted tremendously. However, there are alternatives to foreclosure. Borrowers can try applying for loan modifications. There are different types of modifications available, but the lender does not have to approve the new terms. If catching up on mortgage is unlikely, you can apply for a dee in lieu.

A deed in lieu entails the borrower signing over the deed to the lender and the lender in return, releases the borrrower from liability. Another alternative to a foreclosure is asking the bank to approve a short sale. In a short sale, the bank agrees to allow the borrower to sell the home for less than the value of the loan and the lender will release the borrower from liability if short sale offer is accepted by a buyer. Deed in lieu and short sales can stay on your credit report for up to seven years.

To learn more about this article, please visit Foreclosure activity up across most US metro areas.

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First, in order to file for bankruptcy in the state of Florida, you must have lived consistently in Florida for at least 90 days (3 months) leading up to the filing of the petition. If you live in one of the following counties, you may file your bankruptcy case in the Jacksonville middle district. The counties include: Baker, Bradford, Citrus, Clay, Columbia, Duval, Flagler, Hamilton, Marion, Nassau, Putnam, St.Johns, Sumter,
Suwannee, Union and Volusia.

If you live in Brevard, Lake, Orange, Osceola or Seminole counties, then you have to file in the Orlando division of the Middle District.

Continue reading " Can I file my bankruptcy in Jacksonville, Florida? " »

In a recent story published in “The Daily Record”, a statewide business and legal newspaper out of Maryland, Steve Lash reports that 18 notaries public invoked their Fifth Amendment rights and refused to testify in foreclosure proceedings. The issue involved in this case is whether notarized documents in foreclosures were actually signed by attorney Thomas P. Dore, an attorney representing the bank in foreclosures.

The attorney for the notaries said “truthful answers to questions posed might tend to incriminate them.” If the notaries knowingly falsified signatures for Thomas Dore they could be subject to criminal sanctions for misconduct in office or fraud. Dore was interrogated by the judge in the proceedings and a special master for irregularities in his foreclosure documents. Dore expressed his regret to the court for failing to sign the foreclosure documents himself. “I made a terrible mistake” was his explanation to the court.

It is cases like this that have brought the foreclosure machine under heavy scrutiny for fraudulent practices by courts and investigative authorities all over the country. There has been an abundance of fraud in the way foreclosures have been prosecuted by the banks and their attorneys. Several firms in Florida are under investigation for fraudulent practices as well.

Continue reading " More Fallout in the Foreclosure Crisis Nationwide " »

There are many exceptions to discharge. If a debtor is ever dishonest or tries to defraud the Trustee, the entire petition can be dismissed. Most student loans, IRS debt, and domestic support obligations will not be discharged.

There are exceptions to the exceptions, but a general rule of thumb is these debts are nondischargeable. Cash advances, balance transfers, or convenience checks over $750 within 90 days prior to filing will not be discharged either.

If the Trustee believes a debtor incurs a debt with the intent never to repay, that too would not be dischargeable. All dischargeable means is the debt would be wiped out and those creditors legally prohibited from coming back after you once the bankruptcy ends.

Continue reading " What debts are not dischargeable in a Florida bankruptcy? " »

Many times debtors are willing to part with real estate property. However, banks and other lenders will choose not to accept the signing over of the deed from the borrower for a release of liability. What should a debtor do in this situation? Will bankruptcy protect the debtor?

The short answer is yes. If the debtor qualifies and files for a Chapter 7 bankruptcy and surrenders property, the debt on the property will be discharged as to the debtor filing for bankruptcy. However, if only one party to the note files for bankruptcy, then the lender can legally seek full recourse against the party who did not file for bankruptcy.

Continue reading " Can I Surrender Real Property in a Florida Bankruptcy? " »

A common question in bankruptcy is "How much is my vehicle or vehicles worth?" There are several vehicle appraisers out there but the most commonly used entity is "Kelly Blue Book." In fact, their site can be viewed at Kelly Blue Book.

The value of a debtor's vehicle(s) is very important in a Chapter 7 bankruptcy. If there is equity in the vehicle, a debtor will want to protect that equity if he or she can by applying exemptions.

After applying allowed exemptions, if there is still unprotected equity in the vehicle, the Trustee could essentially seize the vehicle or make the debtor buy back that equity. If there is a loan on the vehicle, and the loan is worth more than the vehicle, then there is no equity and no threat of losing the vehicle as long as the debtor continues to make the loan payments.

Continue reading " What is the Value of My Vehicle in a Florida Bankruptcy? " »

Exemptions are considered in both bankruptcy consumer chapters, but non-exempt property in a Chapter 7 is liquidated and distributed to the debtor's unsecured creditors. A debtor has allowed exemptions in Florida. Each state's allowance may be different.

If a Florida debtor has property over the exemption amount allowed, then the Trustee may liquidate that property, allow the debtor to buyback the equity in the property, or if the property has no value, do nothing. If the debtor is able to buy back the equity in the property, he or she will have no longer than 12 months to pay it off to the Trustee.

Should you have questions, you should contact an experienced bankruptcy attorney to discuss Florida's exemption allowances.

Continue reading " Non-exempt Property and my Florida Bankruptcy " »

In a chapter 7 you may be able to get a full discharge on tax debt if:

1) the debt owed is at least three (3) years old;

2) if you are not suspected of tax evasion;

3) if the IRS has had at least 240 days to inspect the return for which the debt is owed;

4) not debt related to payment penalties for not filing your returns on time or filing them late and

5) the IRS cannot already have a lien against any of your property for that debt you want discharged.

If all 5 factors are present, you may have a chance to have the full debt discharged in a Ch. 7. In a Ch. 13 you may be able to have the remaining debt (that meets the above description) discharged after your final plan payment.

Continue reading " Can I get my IRS tax debt discharged in a Florida bankruptcy? " »

In order for a debtor to file for Chapter 13, the debtor must have a steady stream of income. Monthly wages/salary are not the only methods of income the bankruptcy court will accept. Chapter 13 plans may be approved if the debtor receives a steady income through unemployment, social security, retirement, or any other source of income.

If the income increases or decreases during the life of the plan, the plan may be modified accordingly. However, the Trustee does not have to approve a plan submitted by the debtor. If the Trustee feels the debtor will not be able to make consistent monthly payments, he may recommend the case be converted to a Chapter 7.

If a debtor is unemployed, he or she will most likely be eligible for a Chapter 7. An approved Chapter 13 plan could last anywhere between 3-5 years. The more income a debtor makes, the longer the plan duration will most likely be.

Continue reading " Do I have to be employed to file a Chapter 13 in Florida? " »

The Bankruptcy Code states that if a debtor charges more than $500.00 on one credit card for luxury items within the last 6 months prior to the filing of the petition, that debt will be nondischargeable.

The Code basically defines "luxury items" as any expense not reasonably necessary to live. Also, if a debtor makes charges or purchases on a credit card with the intent never to repay that creditor, that debt will also be considered nondischargeable.

In addition, if a debtor makes over $750 in cash advances or balance transfers within 70 days of filing the petition, those debts will not be discharged either.

This all makes sense. It would not be fair to creditors or good public policy to allow debtors to run up large debts right before filing bankruptcy and then have those debts discharged. That would be a complete abuse of the system and that is why the Code provides these types of provisions and exceptions to discharge.

Continue reading " Can I charge whatever I want to on my credit card right before filing bankruptcy? " »

The Associated Press reported bankruptcy filings slowed down in 2010. December 2010 showed a 3% decrease in filings from December 2009.

There was an overall 10% increase in filings from a year ago but the rate had been growing between 25-35% each year for the last several years.

There is not much indication as to whether there has been a bigger decrease in Ch. 7 filings as opposed to Ch. 13 filings. With foreclosure filings continuing to rise, it is much more likely more 7s are being filed than 13s. But is the drop in bankruptcy filings a sign that the economy is strengthening? Only time will tell.

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AP: Surge in bankruptcies shows signs of slowing.

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If a short sale is agreed to by your primary lender (1st mortgage holder), that does not necessarily mean you will be free and clear of personal liability after a short sale, especially if you have a 2nd mortgage.

If the same lender holds both mortgages and agrees to release the debtor from personaly liability, then great. However, most 2nd mortgages are with different lenders and just because your primary lender agreed to a short sale does not mean the 2nd mortgage lender will. In fact, many lenders are trying to recover the 2nd mortgage notes from the debtor in personal actions after a short sale has occurred.

There are ways to avoid personal judgments for deficiencies in house notes. If you do not handle the situation, you could have your wages garnished and/or liens imposed on other property that you own.

Continue reading " Should I agree to a short sale if I have 2 mortgages? " »

On November 4, 2010 a federal bankruptcy judge in West Virginia ruled that the obligation to pay a former spouse a debt under a divorce decree was dischargeable. In this case the former husband, who later filed for bankruptcy, owed the former wife money for her share of the equity in the marital home, attorney's fees from the dissolution action, costs from the same action, and money owed on a credit card account. The former husband sought to have these debts discharged in a subsequent bankruptcy.

Typically support obligations arising out of a family law case are not dischargeable.

Under 11 U.S.C. sec. 523(a)(5), "[a] discharge under section . . . 1328(b) of this title does not discharge an individual debtor from any debt . . . (5) for a domestic support obligation." The term "domestic support obligation" is defined in the Bankruptcy Code.

In this particular case the Court found that although the debts met three of the four elements under the definition of "domestic support obligations" under the Bankruptcy Code, they did not all meet the fourth requirement that the obligation be in the nature of alimony, maintenance, or support.

Continue reading " Debt Related To Divorce Decree Is Dischargeable " »