MORE BANKRUPTCY Q&A
Get your own lawyer. This is not legal advice for you!
State laws and case law vary.
Here we go.
Subject: Will I be able to Keep my vehicle?
Question: I filed for chapter 7 bankruptcy relief on Sep. 9, 2008. At the time that I filed, I was behind on a few payments to the finance company for my vehicle and requested reaffirmation. The finance company has filed to lift the stay. Will I be able to keep my vehicle?
Answer: Maybe. You need to bring the loan current, or have the loan re-written with the reaffirmation agreement. Otherwise, once the stay is lifted, they can repossess the car if they choose.
Subject: Release of stay
Question: Good evening, After filing Ch 7, I have received a relief of stay from the bank stating they want the house, which we had planned on reaffirming (we are up to date). Now, I’m not sure I should pay this months (Oct) mortgage before we go to the hearing about the release of stay (Oct 22) as then I’ll have no money to move if the bank chooses to keep the house regardless of us being caught up. If the bank does choose to take my home, do you know approximately how long before we will be required to move out? Will I have time to find another place to live or will they just show up and shoo us out the door?
Thanks so much in advance for your kind help.
Answer: The stay modification just allows the creditor to collect from you. If you are current, then you shouldn’t have anything to worry about. You may want to sign a reaffirmation agreement. Please speak with your lawyer to get specific advice though.
Subject: 7 or 13
Question: I have 5 rental homes that are starting the foreclosure process. I currently have 100k in equity in my primary home, and 15k in cars. all rental homes are 80/20 alt a loans. I was told the second lender can and sometimes come after you for the defiency, which all the houses have. Can I file bankruptcy, and still save my primary homes equity and cars?
Answer: You may.
Now, it will come down to if your equity will be protected with your state exemptions, and if you are above the chapter 13 threshold to file, which is just over 1M in secured debt. Speak to a local bankruptcy lawyer for specific advice.
Subject: law suit
Question: I was serve yesterday for a credit debt from 2000. My credit report says it was a charge off. I have 18 more days before the judgment. Is there anyway to stop them from a default judgment. I do not have the money plus they are asking the $1895 plus 8% interest compounded since 2000. The company on the court document is a company that bought the debt. Please help soon. today if the 1st of Oct. and I must know before the 20th.
Answer: Bankruptcy will discharge this debt. The bankruptcy could clear any judgments once you file. In the meantime, though, they can freeze your bank account, garnish wages, or put a lien on your home.
Subject: chap 13
Question: I live in Indiana, and am married for 30 yrs, our house is in my name alone, if my wife files chapter 13 does that cause a stay on foreclosure of our house?
Answer: If your wife is not on the mortgage, her case would not stop any pending foreclosure on your home if it is just in your name.
Subject: Equity line
Question: Hello, filing Ch 7..I forgot to include that in the attorney’s note (representing the mortgage company) requesting the relief from stay, that between our first and second mortgage we currently owe 425,000, it states that the house is only worth 310,000 at this point. Does that mean they can take the house even though our payments on the first and second mortgage are current?
Answer: NO, that just informs the court that there is no equity for the trustee to liquidate. The lender won’t foreclose if you are current.
Subject: Chapter 13 bankruptcy
Question: I filed bankruptcy 3 years ago. I finished in July 1,2008. But i didn’t give my income tax for 2 years,but i gave for one year. Are they still suppose to be garnishing my wages. They mailed me a payoff quote for 3,472.19 I send 1,750.00. After I pay the rest how long will it take me to get my discharge papers. Last week the garnish my wages. Will they continue taking money until the debt is paid.
Answer: Once your balance is paid, the Trustee will audit the file to make sure everyone was paid properly. There are several documents that you may have to file with the court, including your post filing counseling certificate if you haven’t done so. The trustee will send payroll notification to stop deductions once they are paid, any amounts overpaid would be returned to you.
Subject: Chapter 7 and foreclosure
Question: My husband and I are currently in Chapter 7 Bankruptcy. Our meeting of the creditors is next week. I have requested a reaffirmation form from my mortgage company. I was 2 months in arrears, but am now current on my mortgage payments. Today, my attorney and I received a letter from an attorney representing the lender, stating that they have a court day for release of stay. I called the lender and asked them if I am okay with keeping the house since I am up to date, they replied that they will not be taking the house as I am current on my mortgage. Though this attorney has a court date for an appearance in 2 weeks for the release of stay. Will they stop this from happening once the lender notifies the attorney that I am now current on my payments? Now, I’m terrified that I’m going to lose my home….Please advise. Thank you so much!
Answer: It is common to get this motion. if you sign a reaffirmation, you will stay liable for the payments. if you stay current, you should be fine. The motion is just to remove the court protection, you can deal with them directly from that point on.
Subject: Bankruptcy and Marriage
Question: My girlfriend filed for bankruptcy (chapter 13 in Florida) one year ago and now we want to get married in the next year. Will her bankruptcy impact my financial status and will her payments change due to her change in marital status? Thanks for your assistance.
Answer: Everything should stay the same, but she should check with her lawyer in case there are local rules that may say otherwise (I’m in IL)
Question: I know the state laws vary, but in general, is an attorney disbarred if he/she files for personal bankruptcy? Thanks –
Subject: Taxes and Bankruptcy
Question: If someone owe tax money (state and federal, student loans) and get into chapter 13 to force a payment plan. How can the person calculate how much is going to pay? What determine the amount to pay? Do all the debt have to be paid on the years of the bankruptcy?
Answer: taxes that are less than 3 years old are paid 100% thru a chapter 13. If older, you might be able to pay them at a discounted rate with your other unsecured creditors. this can be as low as 10% and up to 100% based on your assets and your income.
Student loans are non-dischargeable, so they would also be paid 10%-100% based on the same issues above, but the balance that doesn’t get paid, you will still owe after the case is done.
Speak to a local bankruptcy attorney (I’m in Illinois) to discuss your case and repayment plan.
Subject: Motion to dismiss Chapter 13
Question: I filed for Chapter 13 almost one year ago, and in the past few months have been unable to make my monthly payments to my trustee. I just received the motion to dismiss my bankruptcy, and I don’t have the money to bring my case current. I am making less money than when I filed (about $3,500 less per year). Does this affect anything? Should I just call my trustee and try to work something out (paying as much as I can today?) Or am I out of luck if I can’t pay the $2,100 I owe right now? I have no one I can ask for help. What happens if my case is dismissed? I have no property and no car loans, etc.
Answer: You would need to discuss with your lawyer about bringing a motion to modify plan/defer default. Otherwise, you can possibly convert, depending on the reasons you were in chapter13. If dismissed, you might be able to refile again.
Subject: civil suit
Question “My situation is this: Filed bankruptcy rel, 01-07. Tried to save the home and didn’t include it in the bankruptcy. Spouse left, Divorced 05-07, With three children and two mortgages, one income, I could not maintain payments, tried to re-finance, no one would. Let the home foreclose, 1st mortgage co. took possession of the property, 2nd company is suing me for the entire amount plus costs, etc. I have no assets left, no disposable income and if they win judgment and garnish my wages I will be forced to quit my job and move. Or something drastic. I answered the complaint, but with no defense, they filed a motion for Summary disposition in their favor. What can I do?”
Answer: You indicated you ‘did not list’ the home in bankruptcy.
1. You were supposed to list all assets and all debts.
2. if you listed both mortgages and did not reaffirm, then the debt is discharged in the case.
3. if you reaffirmed the debt, then you are on the hook.
Talk to your bankruptcy lawyer to see how the debts were listed, if they were at all. If they were not listed, then they were not discharged.
4. Perhaps, if the court will allow, you can file a motion to reopen the case, to file the amended schedules to list the home. This is up to the judge, and there are reopen and amendment fees.
Subject: CHAPTER 7
Question: I FILED 2.5 YEARS AGO I SIGNED A LETTER OF Re-Affirmation. I’VE DISCHARGED LATER FINDING OUT THAT MORTGAGE COMPANY NEVER FILED IT IT WITH THE COURTS AFTER CALLING THE BANK THEY TOLD ME THAT I WAS JUST PAYING RENT I HAVE NOT MISS A PAYMENT UNTIL I QUIT PAYING ON THE HOUSE THAT WAS NOT MINE I HAVE INVESTED A LOT OF MONEY IN TO THE HOUSE ROOF WINDOWS AND LOT MORE DO I HAVE ANT LEGAL ACTION IN THIS MATTER
Answer: if you want to keep the property, you need to keep making the regular payments and stay current. You can also refinance it with another lender, which you would then be ‘on the hook’ for the loan.
Subject: small claims and bankruptcy
Question: I has two small claim judgments that stemmed from 2 credit card accounts. These judgments and credit cards were discharged on my chapter 7 bankruptcy.
The small claims judgments are still open and the courts wont close them. what do I do to get them closed? and also one of the attorneys on one of the suits cannot be found anywhere.? any way to fix this..?
Answer: You can contact the court clerk to properly report the debt as discharged. Also you can contact the credit bureau’s to fix any errors.
Subject: Bankruptcy and Divorce
Question: I recently filed for Chapter 7 (September 17, 2008). I am currently separated and legally married. I filed as an individual for the bankruptcy.
My wife called me yesterday and wants to file for divorce (Uncontested without minor children). She might of overreacted due to receiving a letter from the BK court stating that she is listed as a creditor.
Will this effect my bankruptcy. I have my creditors meeting on October 31.
Can you have to cases at the same time?
Should I see if she can stall filing until after my discharge in January or does it matter?
Thank you so much for your time and attention to my question.
Answer: It should not effect your case.
You can start the divorce proceeding at any time.
The divorce decree will allocate joint debts, so be sure that you understand which debts you will be responsible for after the divorce (the bankruptcy won’t remove her responsibility for the debts)
Question: A relative died several months before I filed bankruptcy. I found out later that I may receive an inheritance. At the time filing and at the time of my hearing it was unknown if there would be any money to be received. If there is, do I have to turn this over to my creditors?
Answer: Inheritances have to be disclosed to the trustee and court for 6 months after you file the case. Provide this information, and the trustee will decide (based on your allowable state/federal exemptions) if they want to liquidate the inheritance to pay to your unsecured creditors. Failure to report this can result in your discharge being revoked
Subject: Realize debts not listed on schedule after hearing
Question: My wife and I filed CH. 7 on 8/27/08, and had our hearing on 9/23/08. A day or two after the hearing we had calls from collection agency and noticed that this specific debt was not listed on our schedule of debts. After closer examination we realized there were other debts not listed. How can we go about getting these debts listed and still be able to get the bk discharged??
Answer: You can amend the schedules with the bankruptcy clerk. Send notice to the trustee and to the creditors. That should do it. Talk to your lawyer, as this is a really simple process that they can handle for you.