The Benefits and Disadvantages of Filing for Bankruptcy

Posted on August 22, 2013 by Staff Writer

The choice to file for bankruptcy is not an easy one. The benefits need to outweigh the negative results of bankruptcy. It is necessary to have a full understanding of the consequences of bankruptcy in order to make the best decision possible.

The following are possible outcomes of bankruptcy:

1. Weakened Credit Score

Filing for bankruptcy has a negative effect on your credit score. A bankruptcy shows up on your personal report for 7 to 10 years depending on the type of bankruptcy for which you file. Yet, bankruptcy allows for a financial fresh start. You can rebuild your credit over time and there is an opportunity for it to be better than before your bankruptcy.

2. Difficulty Getting Loans

One of the results of having a bad credit score post-bankruptcy is that it will be more difficult to get a loan. You will also have a difficult time being approved for credit cards and financing the purchase of a home. Yet, if you are considering filing for bankruptcy, it might not be the best idea to have new bills to pay.

3. Issues with Finding Employment

Potential employers occasionally review your credit report before offering you a job. Certain states have outlawed or limited such a practice because of the negative cycle it perpetuates. People who can’t pay their bills on time are not able to get jobs that would allow them to pay their bills on time. Arizona is not one of the states that currently regulates such activity.

The benefits of bankruptcy can far outweigh the negative aspects because it will allow you to start fresh. It is important to discuss your situation with an Arizona bankruptcy lawyer. Bankruptcy will eliminate either some or all of your debts depending on what chapter is selected. Filing will also stop harassment from creditors, foreclosure, wage garnishment, or repossession because filing creates an injunction called an automatic stay. In the long run, a bankruptcy will allow you to build your credit back up to a respectable level and allow you to regain your life. Contact a dedicated bankruptcy attorney in Casa Grande who can assist you in deciding if filing is the right step for you.

Fewer People are Filing for Bankruptcy because of New Habits

Posted on August 18, 2013 by Staff Writer

Since the beginning of 2013, consumers in the United States are not filing for bankruptcy protection as much as previous years. The way consumers are carrying debt has also improved. Credit card debt is one type of debt that can be removed or reduced through bankruptcy. Only 2.4% of credit cards were delinquent by thirty days or more, which is the lowest percentage in over 20 years.

“Sharply lower delinquency levels reflect improving consumer balance sheets, steady job creation and a continuing increase in household wealth,” said James Chessen, the American Bankers Association’s chief economist. “Many consumers have learned the hard lessons of recession and have redoubled their efforts to keep debt at manageable levels.”

This decrease in filings is a trend not only nationally, but in the Phoenix as well. Compared to the same period of last year, there was almost a 25% decrease in filings. Overall, bankruptcies have been decreasing since their peak in 2009.

Certain bankruptcy experts look to temper this good news by looking at possible causes for this decrease. They say it is not necessarily a sign that the economy is recovering, but that consumers are reluctant to sign up for new bills. The executive director of the American Bankruptcy Institute, Sam Gerdano, said that consumers have limited the chance of filing for bankruptcy by living on their base income alone.

If you have experienced a change in your life and need a fresh start financially, consider filing for bankruptcy. Large medical expenses, losing your job, and filing for divorce can all put a major strain on your bank account, even if you are frugal with your money. Don’t let an unexpected event get in the way of your future, contact an experienced bankruptcy attorney in Phoenix today. They can see if you qualify for bankruptcy and let you know what options are available to you.

The Bankruptcy Automatic Stay – Good Dog

Posted on August 8, 2013 by Staff Writer

So filing bankruptcy with a good bankruptcy lawyer is supposed to put a leash on your creditors, but when do they stop? What is there to make them stop calling, harassing, or garnishing? There is an injunction from a federal judge called the “automatic stay”. The judge essentially tells your creditors to stay, like a dog. When the judge speaks, they listen.

The automatic stay is a statutory injunction that is issued by the court immediately upon filing of a bankruptcy petition. Bankruptcy Code 362, and 101 (15). It is designed to protect the debtor and provide a break from collection efforts. Before the actual filing of the bankruptcy petition, you have to rely on your bankruptcy attorney to fend off your creditors by taking their calls and enforcing collection rules. This, in itself, is enough of a reason to retain a bankruptcy lawyer right away.

Once your bankruptcy attorney files your bankruptcy petition, the automatic stay goes into effect automatically, as the name would suggest. It is a very powerful tool and applies to nearly every entity involved in the bankruptcy. The automatic stay does not mean your debt is forgiven or discharged, it just calls off the creditors.

As long as your bankruptcy case is active, your bankruptcy attorney can enforce the automatic stay to protect your interests. Beware, once your bankruptcy is dismissed or goes away, so does the automatic stay. However, while it’s in place, most actions are prohibited. A creditor cannot start a new lawsuit or even continue any existing lawsuit to collect a pre-petition claim. Ellis V. Consolidated Diesel Electric Corp, 894 F.2^nd 371 (10^th Cir. 1990). Even if a creditor already has a judgment against you, the automatic stay will stop collection of that judgment through garnishment or execution on your property, immediately. The bankruptcy law even prohibits attempts to collect, especially harassing, bothering, or intimidating the debtor. B.C. 362 (a)(6)

The automatic stay is an amazing tool. There are reasons it might not be granted or might not apply to a specific debt. There are also a bunch of exceptions to the automatic stay where some courts and some creditors may still be able to pursue you. This is a very important part of a Chapter 7 or a Chapter 13 bankruptcy filing. It is one of the best and most immediate manifestations of bankruptcy relief. It is significant to execute and enforce the automatic stay. It is one of the main tools against a creditor. A qualified and affordable bankruptcy lawyer can help you through this. You can retain immediately to assuage the creditor calls and harassment. Payment plans are available, and the consultation is free. GET FREE HELP NOW.

Getting a Mortgage after Bankruptcy

Posted on August 7, 2013 by Staff Writer

At one time, going through bankruptcy had a stigma that was hard to shake when trying to move on with your financial life. However, according to SFGate Home Guides, not only is the stigma around bankruptcy lessening, but it is also very possible to get a new home in as little as a couple of years after the discharge of your bankruptcy. Here are a few things that you can do to get there.

Check for Accuracy

Once your bankruptcy has been discharged, check your credit report to ensure that everything that was included in the bankruptcy has been closed and discharged. You want to make sure that you do not have any inaccuracies there to bring down your credit score.

Open New Trade Lines

If you have any debt that was not included in the bankruptcy, such as student loans, make sure that you make timely payments on them. Remember, the point is to show that you are now creditworthy and financially responsible. Now that your bankruptcy is discharged, you will be getting offers for credit cards. Find the one with the lowest interest rate and fees. Once you acquire your new credit card, never use more than 30 percent of your credit line, and pay the balance every month.

Take Out a Larger Loan

About a year after your discharge, take out a larger loan such as a car note. You need to be able to show that you can handle a larger debt. Make sure that you have zero late payments while you are in the process of rebuilding your credit profile. You have to show your creditworthiness.

If you have questions regarding what you can include in your bankruptcy or about the discharge of your bankruptcy, a qualified and experienced Arizona bankruptcy attorney can assist you.

The Section 341 Meeting of Creditors Requirements in Bankruptcy

Posted on August 6, 2013 by Staff Writer

One of the many obligations of a debtor after filing a bankruptcy petition is to attend the section 341 meeting of the creditors. This is a make or break moment for most bankruptcy cases. If your bankruptcy lawyer has properly prepared your bankruptcy petition, including the schedules, disclosures, and fees, it may be a very short inquisition. However, if your bankruptcy petition is deficient, or if all of the schedules and disclosures have not been filed, the section 341 creditors meeting is not the most discrete or appropriate place to find this out. In fact, if all of the proper information has not been provided to conduct the examination, the U.S. Trustee may continue your hearing, at best, and may even move to dismiss your case.

The U.S. Trustee is not one to be trifled with. The section 341 creditors meeting is not a judicial hearing, thus, the United States Trustee is to preside over the meeting. The judge is even prohibited from attending the 341 creditors meeting having to defer to the U.S. Trustee. B.C. §341, Bankruptcy Rule 2003 (b). Therefore, it is of utmost importance to be sure all documents and disclosures have been filed and are acceptable to the U .S. Trustee.

The section 341 meeting of creditors will be held between 20 and 50 days from the filing of the bankruptcy petition. It will be held at the courthouse or at a place assigned by the U.S. Trustee. The Clerk of the Court will provide at least 20 days notice, usually more, of the 341 meeting of creditors to the debtor, debtor’s bankruptcy attorney, the trustee, all secured and unsecured creditors, and other interested parties. The notice of 341 creditors meeting is comprehensive. It will include notice of the order for relief, B.C. 342, notice of the automatic stay, B.C. 362(a), and notice of the final dates for claims, complaints, and objections to discharge to be filed.

Essentially, every interested party gets to ask questions of the debtor. It is the purpose of the 341 creditors meeting to provide opportunity for creditors, the trustee, or other appointed or interested parties to examine the debtor under oath. Bankruptcy Code section 343. Normal questions can be about location and existence of property, exemptions, facts related to secured or non-dischargeable debt, debtors reasons for filing, and goals of reorganization.

There are many things that can go wrong at a 341 meeting of creditors, and even more that can happen to complicate a bankruptcy case. It is essential to file and prepare properly. There is no reason to attempt to understand the nuances of the 341 meeting of creditors and bankruptcy law. A qualified bankruptcy lawyer is affordable and invaluable. Payment plans are available and the consultation is free. GET FREE HELP NOW from a quality, experienced bankruptcy attorney.

Doctors Facing Bankruptcy

Posted on July 29, 2013 by Staff Writer

It’s not just the unemployed or underemployed that are still dealing with the ripple effects of the financial crisis. According to CNN Money Magazine, “as many doctors struggle to keep their practices financially sound, some are buckling under money woes and being pushed into bankruptcy.” The American Bankruptcy Institute’s health care committee, chaired by Bobby Guy, has recently noted a spike in bankruptcy filings by physician practices. Guy told CNN Money that there was a period in early 2013 when there were eight filings in a row, which before would have been considered unusual.

But it’s not doctors working in large hospitals or practices that are necessarily facing financial insolvency. Chapter 11 bankruptcy for physicians is more common when the doctor has a small private practice. Guy told CNN Money that “the weak economy has taken a toll on doctors’ revenue as consumers cut back on office visits and lucrative elective procedures.” There is also the issue of “shrinking insurance reimbursements, changing regulations, and the rising costs of malpractice insurance, drugs, and other business necessities” for a doctor’s practice, according to CNN Money.

It’s not only doctors who are affected by their practices closing—Chapter 11 does, of course, affect the filer first and foremost, but in areas where there’s only one small doctor’s practice, its closing can severely affect the community. “Having a cancer practice closer,” for example, “can be debilitating to a community,” according to CNN Money. An oncologist in Connecticut, who had had a successful solo practice for years, told CNN that his revenues began to fall when “reimbursements for treatment and drugs” starting shrinking. While he referred his patients to larger area hospitals, his practice closing likely had a severe affect on them as well. And it’s not just specialists facing bankruptcy. Primary care doctors “face similar challenges,” according to CNN Money. Fewer patients able to afford care means less profits for doctors.

If you or someone you know is a doctor who is facing financial insolvency, bankruptcy may be the best option. Don’t go through it alone. Contact a dedicated Arizona bankruptcy attorney today.

Bankruptcy Exemptions

Posted on July 25, 2013 by Staff Writer

The Bankruptcy exemptions are unique to each state. They are normally the same exemptions used to apply to creditor collection lawsuits. The exemptions, when used in a bankruptcy filing, can be more complex than they appear. Some of the exemptions can be used twice, once for each spouse. Some of the exemptions can only be used under certain circumstances. Different trustees treat exemptions differently. Nobody will be coming to your house to count your forks to assure you have been specific and accurate with declaring you bankruptcy exemptions, but unless the numbers are within a certain range, the trustee will likely be alerted to some fraud.

Running afoul of the exemption declaration is easy, but it is also easy to avoid. Like most things, experience is invaluable. There is no reason to step in front of such harm and scrutiny as making a mistake on your bankruptcy exemptions. An experienced bankruptcy attorney will be able to guide you through the filing and give you peace of mind that you will not lose property that could have been declared exempt, or worse yet get fined or prosecuted if the trustee thinks you did it on purpose.

An experienced bankruptcy lawyer is your best friend in unfamiliar times. You can schedule a free appointment to talk to the bankruptcy attorney over the phone or in person. There are payment plans available and the consultation is free. A great bankruptcy lawyer can help you through this. GET FREE HELP NOW.

Getting back on your Feet after Bankruptcy

Posted on July 23, 2013 by Staff Writer

As you may have learned by now, having to file for bankruptcy does not mean the end of your financial world. It is quite the opposite; you have the opportunity to have a fresh start after filing bankruptcy and having your debts discharged.

Create your Budget

Part of recovering from your bankruptcy is getting back on track. Create a budget that includes the items that need to be paid monthly. Make sure that you also cut the things that you do not need to have until you are sure that you are not taking on expenses that you cannot afford. This is the time to restructure your finances and ensure that all of you payments are timely to reflect a financially responsible comeback from bankruptcy.

Pay Cash when you can

Whenever you can, don’t use credit. You do not want to overspend and end up in the same type of situation that led to the bankruptcy. The way that you treat your finances now will heavily weigh on how you will look to potential creditors.

Stay away from Large Loans

While it is important to establish new trade lines, you want to stay away from large loans such as car loans. Until you establish that you are credit worthy, your interest rates will be higher because you will be a risk to new creditors. This higher interest rate will mean that you are paying more toward the interest of the loan than the principle. Depending on the type of loan that you are looking for, the higher interest rate can mean a significantly higher payment for you.

If you have questions about how to get your credit back on track once your debts are discharged, your Arizona bankruptcy attorney can assist you with questions as well as make good suggestions to get you back on track for the long term.

Bankruptcy Exemptions to Keep Wedding Ring

Posted on July 21, 2013 by Staff Writer

Bankruptcy exemptions will likely allow you to keep your wedding rings. Here’s how:

A bankruptcy exemption describes an asset that is exempt from the bankruptcy process. An asset identified as an exemption to bankruptcy is an asset you can keep.

These exemptions can be found listed in most bankruptcy codes as well as in Arizona Revised Statutes. The exemption for a wedding ring is quoted as follows: “All engagement and wedding rings not in excess of an aggregate fair market value of one thousand dollars.” This begs several questions.

What is fair market value? The bankruptcy code will also talk about replacement value. We all know, or at least suspect, that the normal makeup of a jewelry store is several times the value of the ring. The appraisals they provide are usually more disingenuous and just lead to higher insurance premiums instead of reflecting the actual value of the ring. Let’s look at it from a very pragmatic perspective. What would it really cost to replace the ring? Buying it a jewelry store is something love-struck patrons do. If you found one, could you replace it from a pawn shop? What would it really cost? What would the pawn shop really take? It is a used ring. You cannot usually buy used rings at the mall. Therefore, used rings at a pawn shop might be your best indication of fair market or replacement cost.

Unless your ring is declared on an insurance policy or the U.S trustee has reason to believe it is worth a large sum, it might occur to you that the receipt is not registered anywhere and how do they know you had a ring anyway. You probably had to sell it to pay your bankruptcy lawyer. You would be correct in all of these thoughts. But try not to fall into this trap. It is never a good idea to wear jewelry to a bankruptcy hearing, but the minute you do not declare an asset, you are exposing yourself to a lot of liability you just don’t need. You are signing under oath that you have declared all of your property, and perjury is such an ugly word.

If you are having trouble with the value of an asset compared to the exemption, don’t forget to subtract any money owed on the asset. In any event, you should probably talk to a qualified bankruptcy attorney. There are many ways to deal with the issue. Make sure you do it right. GET FREE HELP NOW.

How to avoid filing Bankruptcy Again

Posted on July 19, 2013 by Staff Writer

Filing bankruptcy can give you the fresh start that you are looking for. You are finally free of debt, you are not in collections, and you don’t have bill collectors ringing your phone off the hook. It feels great to feel free but the most important thing is to be financially responsible. Recent reports showed that of all of the bankruptcies filed in 2011, 28 percent of them were repeat filings. Here are a few steps that you can follow to ensure that you are not a part of this statistic.

Be Careful with Credit

Part of having good credit is having positive trade lines on your account. The easiest way to establish these positive reports is my establishing credit. The most common way to establish credit and have it reported is through a credit card. Many credit card companies will start sending offers as soon as a person has their bankruptcy discharged. Treat these new credit cards with respect. Use them only when needed and pay them off in full each month.

Seek Preventative Medical Care

The highest debt for many people is for medical care. A way to keep medical debt down is to go see your regular doctor as soon as you begin feeling ill. Trips to the emergency room can be much more costly and can lead to a hospitalization. The office visit charge is usually cheaper and if you are strapped for cash, many offices allow you to make interest free payments.

Live within your Means

It is easy for people to be carried away into living beyond their means. Create a budget and stick to it. Diligent budgeting can also make it feasible to purchase a luxury item for yourself occasionally. If you have questions regarding the discharge of your bankruptcy or starting all over, your Arizona bankruptcy attorney can answer those questions for you.