Bankruptcy and Foreclosure Attorney Blog

Many personal injury judgments are being recorded and if the defendant cannot pay, plaintiff's are having defendants' licenses suspended. If the defendant cannot pay and is able to discharge this debt through a bankruptcy, then he or she should be able to show the discharge paperwork to a local DMV and get his or her license reinstated.

However, if the defendant was charged with driving under the influence of alcohol or committed some type of intentional act, the personal injury debt would not be discharged. The only way a defendant would be able to have their license reinstated, in this instance, would be to pay off the judgment, any restitution, and any court fines and/or costs. Criminal fines and court costs are not dischargeable in a bankruptcy.

Continue reading " Personal Injury Judgments, License Suspensions, and Bankruptcy " »

In recent posts, we mentioned how there are thousands of Florida foreclosure cases sitting in limbo especialy with the closing of powerhouse foreclosure firms.

Many of these cases have had zero activity for quite some time and, therefore, are subject to dismissal for "failure to prosecute." This is great news for many homeowners that are facing foreclosure suits. It should buy time to stay in their homes a little longer until the bank decides to refile a complaint, if they choose to do so.

A home is not like a vehicle in that a vehicle can be repossessed anytime there is a default by the borrower. No lawsuit is needed. However, real property cannot be "repossessed" until a competent court permits the foreclosure to occur.

Florida judges will most certainly begin dismissing cases to help free up their dockets and relieve the limited resources that are available to handle these massive caseloads.

To learn more about this article, please visit, Florida Courts May Begin Dismissing Foreclosure.

Continue reading " Are Florida Courts Dismissing Foreclosure Suits? " »

Lender Processing Services (LPS) Ben-Ezra & Katz law firm, and LPS Default Solutions, Inc. are being sued in the Florida Northern District Federal Court. The complaint alleges, among other things, that these entities defrauded bankruptcy courts and breached the federal bankruptcy code by misrepresenting what was owed for attorney's fees.

There are several other plaintiffs looking to file similar complaints, therefore, the action may class actionable in the near future.

The above mentioned law firm allegedly split fees with the LPS subsidiary and classify attorneys fees as administrative fees as to the amount that was owed. In addition, the law firm is based out of Ft. Lauderdale but is one of many who alledgely defrauded bankruptcy courts.

Representatives from LPS failed to comment on the litigation, but made note that these types of actions have been attempted before, but never have succeeded.

To learn more about this article, please visit, Mortgage foreclosure mill sued in alleged kick-back scheme.

Continue reading " Foreclosure Mill being Sued in Florida District Court " »

Many times debtors cannot continue to make the chapter 13 plan payments as set forth and approved by the Chapter 13 Trustee.

They foresee having economic troubles with making the payments but still need economic relief. Debtors can convert their 13 case to a chapter 7. This also assumes the debtor's income meets the income requirements and the mean's test is satisfied.

However, keep in mind that if you are not current on secured debt, there is a strong possibility the creditor will ask relief from the automatic stay and ask the bankruptcy court to pursue state court remedies.

For example, if you are behind on your mortgage and you convert your caseto a chapter 7, you may subject the property to foreclosure.

Continue reading " Can I convert from a Chapter 13 to a Chapter 7 after I have filed my petition? " »

Often times debtors file bankruptcy and have received or are expecting to receive tax refunds from the previous tax return. In chapter 7 and chapter 13 cases, these refunds are considered property of the estate.

It may be forfeited to the bankruptcy Trustee unless there are exemptions available to protect it. If a debtor is in chapter 13, they are more than likely going to have to surrender the refund every year they are in the bankruptcy unless you can show a hardhsip for why you need it. The refund is considered additional income and does not satisfy that month's plan payment requirement.

If you have already spent the refund, the debtor may become indebted to the bankruptcy court for the amount of the refund and may have to pay back the court over a period of time.

Continue reading " Tax Refunds and Bankruptcy " »

In most cases, yes. Bankruptcy should be a last resort kind of option. However, when clients schedule a consult with our office, it is usually the only or best option at that particular moment.

Bankruptcy will certainly affect a debtor's credit. However, there is a good chance your credit is already shot by the time you file for bankruptcy. What bankruptcy does provide is an ability to approximate beginning and end dates in terms of how long your credit will be dampered. If a debtor does not file bankruptcy and continues to be delinquent on bills and other debt, the debtor runs the risk of garnishments, judgments, and liens in addition to a poor credit score.

Alternatives to bankruptcy are do nothing and become delinquent on bills, try and work out agreements with creditors yourself (which rarely works) or hire debt consolidation companies. Most debt consolidation companies are being heavily monitored by the Federal Trade Commission and every state attorney general for taking large fees upfront and never negotiating on client's behalves.
Needless to say, bankruptcy is sometimes the only option available.

To read the corresponding article, please visit Bankruptcy, The Last Resort.

Continue reading " Should Bankruptcy be a Last Resort Option? " »

The Middle District of Florida (which consists of the Jacksonville, Orlando, and Tampa areas)
saw a decrease in bankruptcy filings for the first quarter of 2011. 2010 was a record breaking year for number of filings.

Reports show that filings are down about 16% thus far for the three major chapters. However, the decrease may be attributed to the foreclosure freezes because of the robo-signing debacle last fall. People are able to stay in their homes longer because of the freeze but once foreclosure filings pick up so too will bankruptcy filings.

There were 2,415 bankruptcy filings in the Jacksonville Division from January to March. There were 2,799 filings at the same time last year in the Jacksonville Division.

To learn more about this article, please visit Bankruptcies declining after record 2010.

Continue reading " Bankruptcy Filings down for 1st Quarter of 2011 " »

If a debtor is filing for chapter 7 bankruptcy relief, and the debt is primarily personal debt, than the debtor may have to consider passing the "mean's test." What is the lookback period for determining whether or not a debtor will qualify for a chapter 7?

The Trustee will lookback to the income from the past six months from the date of filing in determining eligibility.

The entire household income will be considered. Therefore, if a debtor who is contemplating bankruptcy makes too much money but knows the income will reduce soon, then he or she should hold off for a few months until the six month average falls below the state median income for that household.

Continue reading " What time period is considered for whether or not I qualify for Chapter 7? " »

Yes. A debtor may add tax debt into the plan payments that are being paid to the Trustee every month. In fact, the debt will not accrue additional penalties or interest charges while it is included in the plan.

If the tax debt is older than three years, their is a possibility that the remaining balance after your last 13 plan payment can be discharged. Any and all tax debt can be included in the plan. However, any tax debt that you incur postpetition, you will be responsible for.

Back taxes and bankruptcy can be a very difficult combination to grasp especially when one has an implication on the other. If you have questions about tax debt and/or bankruptcy, please do not hesitate to ask.

Continue reading " Can tax debt be included in my Ch. 13 Florida Bankruptcy? " »

This is a very common question that comes up in bankruptcy. In addition to credit card and medical debt, there are additional debts that are considered unsecured and should be discharged in your bankruptcy. Old utility bills, car repossessions, evictions, contract damages, and personal injury judgments are just a few other debts that should be discharged through the bankruptcy.

We have our clients pull credit reports from all three credit reporting agencies to ensure that all creditors are listed in the bankruptcy petition and schedules. Debtors should also anticipate future creditors and list them in their schedules. Credit reports only pick up existing or current creditors.

For example, if you are contemplating bankruptcy but know you have an expensive medical procedure coming up, you may want to wait to file for bankruptcy in case you need to include that debt in your bankruptcy. Remember debt incurred post-filing, you are personally liable for.

Continue reading " Apart from Credit Cards and Medical Bills, what other unsecured debts are discharged in a Bankruptcy? " »

If you are behind on your mortgage payments and file for chapter 7 bankruptcy relief, your lender will most likely pursue foreclosure actions against you either during or after the bankruptcy. If you plan to keep your home, chapter 7 is not the proper course of action to take.

Chapter 13 allows a debtor to pay mortgage arrears for a period not to exceed 5 years in order to catch up. Please keep in mind the debtor will have to make regular monthly payments in addition to making payments towards the arrears every month. You cannot alter mortgage terms on a first mortgage in a chapter 13.

If you plan to surrender the house and are able to qualify for a chapter 7, you may discharge your mortgage obligations through a chapter 7.

Continue reading " What Bankruptcy chapter should I file if I am behind on my mortgage payments? " »

Many debtors who filed bankruptcy before are wondering how long they have to wait before they can file again. The answer depends on several factors.

First, how long has it been since you FILED your last bankruptcy? Notice the key date is the filing date, not the discharge date.

Second, did you receive a discharge in your case? If you did not receive a discharge, you may file again without waiting as long as the case was not dismissed with prejudice.

Third, what chapter are you looking at filing? The waiting period is different depending on the chapter you are filing. A debtor must wait eight years between filing dates on Chapter 7s.

There is only a four year waiting period between Chapter 7 and Chapter 13 filings.

Continue reading " How long do I have to wait to file for bankruptcy again? " »

First, it really depends on the type of debt. If a debtor has mostly unsecured debts, then bankruptcy may be a viable option. However, if a debtor has mostly student loan and current IRS debt, then a bankruptcy will not do the debtor much good because those debts are generally nondischargeable.

There is no amount of debt that is required or needed to file for bankruptcy. It really depends on each individual case. $10,000 in credit card debt may not be as damaging to one debtor as it is to another. It really depends on whether or not a debtor feels he or she can get out of the financial hole currently consuming their lives. Credit card interest rates can be very excessive and just making the minimum payment every month will never satisfy that balance. In most cases, you will be paying on that debt much longer than you ever anticipated.

Many times debtors have bad luck and incur thousands and thousands of dollars in medical debt. The medical company will normally turn the debt over to a collection agency if the debtorhas defaulted on the debt.

Continue reading " How do I know if I have enough debt to file for bankruptcy? " »

Many times debtors leave vehicles and other assets in their own names and never transfer the title to the individual actually benefitting from the asset. However, if a debtor is considering bankruptcy, it is not a good idea to begin retitling assets. Although the asset may be for another's benefit, it is still your asset because it is in your name!

This will be a red flag to the bankruptcy Trustee and he or she may try and dismiss the petition altogether if he or she feels abuse or fraud is involved. In fact, the Trustee can retroactively go back 90 days (for non-insider transactions) and/or 1 year (for insider transactions) from the time the petition is filed. An insider transaction simply means the debtor transferred an asset to a family member or friend.

If a Trustee believes there is preferential treatment, he or she can actually go and recapture the asset that was transferred and consider it "property of the debtor's estate."

Continue reading " Vehicles in my Name But For Others Benefit and Bankruptcy " »

A reaffirmation agreement is something a lender (holding a secured lien) will send you once a debtor files for bankruptcy. These are common for vehicle loans and mortgages. The question becomes should you sign the reaffirmation agreement? And what does that mean?

It means you will be personally responsible for the loan until it is paid off. You should really consider the total value of the vehicle compared to the value of the loan. If the lender wants you to reaffirm a loan that is much more than the vehicle is worth, it may not be in your best interest to sign the agreement. This is particularly true if you have other means of transportation.

If you do not have other means of transportation, it may be in the debtor's best interst to sign the agreement. Redemption is a little bit different. Redemption basically crams down the value of the loan equal to the value of the vehicle. Lenders are hesitant to do this and attorneys typically charge an additional fee to negotiate a reaffirmation or redemption proposal.

If you do not sign the reaffirmation agreement, the lender may try and foreclose or repossess the property. Mortgage loans should never be reaffirmed.

Continue reading " What is a Reaffirmation Agreement and do I have to sign one? " »

Whether you file for Chapter 7 or 13 bankruptcy relief, they will both be on your credit for 10 years. However, many debtors find that they are receiving credit offers within months of filing. Now, these offers are usually for smaller lines of credit, but this is the way you begin to rebuild your credit.

One of the reasons for this has to do with the fact that future creditors know debtors are going to have debts discharged and will have extra cash available to pay them. This is especially true in a Chapter 7.

Another reason creditors will lend to those coming out of bankruptcy is because they know the debtor cannot file again for at least 4 years, maybe longer. So, whatever debt they incur post-petition, the debtor will be personally liable for.

Continue reading " How bad will a bankruptcy affect my credit? " »

A second mortgage can only be stripped in a Chapter 13. The possibility for stripping a mortgage depends on the value of the debtor's home, the 1st mortgage balance, and the 2nd mortgage balance. Stripping mortgages is procedurally unique in each jurisdiction. Different judges have different requirements.

Once the Chapter 13 is filed, it is up to each creditor to file what is commonly referred to as a "proof of claim." Once the proof of claim is filed, the attorney usually has a certain time period to file a motion on behalf of the debtor to strip the mortgge.

The judge may decide to hold a hearing on the matter or, if it is uncontested, simply grant the stripping. What does that mean? It means it will change the treatment from secured to unsecured debt and the lender will get what all the other unsecured creditors are getting. Once the lien is stripped and the debtor is out of the bankruptcy, the debtor will only have to pay one mortgage every month.

Continue reading " How is a 2nd mortgage stripped in a bankruptcy? " »

Debt consolidation companies are under close scrutiny from many state Attorney Generals and the Federal Trade Commision (FTC). Reason being, many of these companies were requiring large, upfront fees and not doing anything in return.

One of the many fallbacks to using a debt consolidation company is that your creditors are not legally required to negotiate with these types of companies. There are no state or federal laws in place that forces these companies to negotiate with debt consolidation companies.

However, in a bankruptcy not only does the automatic stay keep creditors from contacting the debtor throughout the bankruptcy, it forces creditors into negotiations and agreements that they necessarily would not have agreed to outside of a bankruptcy.

Continue reading " Should I use a debt consolidation company rather than Bankruptcy? " »

In a recent post, we mentioned the closing of the David J. Stern office. They were a powerhouse foreclosure firm that represented creditor rights nationwide. With the announcement of their closure, there are over 9,000 cases in limbo throughout the state of Florida.

Case management officials are trying to distribute the cases to those wishing to take them, but it is anticipated that many of these cases will be dismissed. Although they may be dismissed, that will not preclude the banks from refiling these foreclosure suits.

However, it will give homeowners an extra few months to stay in their homes before having to surrender and vacate them. To learn more about this article, please visit South Florida law firm's demise puts 9,000 foreclosures in limbo.

Continue reading " Stern's closure leaves thousands of Foreclosure cases Pending " »

Here are a few tips on what actions to avoid if you are thinking about filing for bankruptcy. First, do not go out and retitle a bunch of your assets. Second, do not pay back family member for debts you owe them. The Bankruptcy Trustee may seek to recover those payments from the family member you made the payments too. If they do not have that money to pay back the Trustee, they will be in debt to the bankruptcy court. Third, do not take out cash advances, pay day loans, or balance transfers. Many times, these debts are non-dischargeable. Fourth, if you owe the IRS, do what you can to setup a payment plan with them! Fifth, keep making the monthly payments on secured debt. It is the unsecured debt that you can stop making payments on to help with legal fees or costs.

Continue reading " Actions to Avoid Before Filing for Bankruptcy " »

Once a debtor files a bankruptcy petition, the petition counts only those debts that are mentioned in the schedules. Therefore, any new debt a debtor incurs after the bankruptcy petition has been filed, they are on the hook for.

Property of the estate is also determined at the date of filing. Postpetition wages are not considered property of the estate in a Chapter 7. The debtor's property of the estate will be the property subject to liquidation if there is no exemption to protect it. In addition, a bankruptcy Trustee will keep in mind inheritances received up to six months after the petition has been filed.

If the debtor is not upfront and honest with the Trustee in disclosing these types of things, he or she could subject the bankruptcy petition to being dismissed or even worse the debtor could face purjury charges.

Continue reading " What about the debts I incur after I file bankruptcy? Are they included as well? " »