When you file for Chapter 7 bankruptcy, most of your assets are sold to raise money to repay your debts. Obviously, you would try to keep as many of your properties as possible. There are some properties that can be redeemed and thus kept under Chapter 7 bankruptcy.
You redeem a secured property by paying off the secured portion of a loan. By so doing, you will be able to reduce your monthly debt payments by reducing the outstanding balance and hence keep the property.
Let’s say you want to redeem a vehicle valued at $15,000 which has a loan of $22,000 on it. You would pay the value of your vehicle ($15,000) in cash and get to keep the property. The balance of $7,000 is regarded as an unsecured debt and may be discharged depending on the details of the bankruptcy case.
However, redemption can only be applied to personal properties such as vehicles, household appliances etc that are used by you and your household. All forms of real estate do not fall under the category of personal property so they cannot be redeemed in bankruptcy. For real estate, you have other options to keep them when a mortgage is not fully secured by the value of the property.
Likewise, business property is also not eligible for redemption in Chapter 7 bankruptcy. While a personal vehicle can be redeemed, a car registered under your business name cannot even though you use it as a sole proprietor.
If you wish to redeem your personal property, call us at (813) 200 4133 to schedule an appointment for a free consultation. When you engage us, we will help you file a motion for redemption with the bankruptcy court.
Alternatively, you can look into other ways to keep your property such as reaffirmation. If you redeem your property, you will be discharged of future debt although it will entail some lump sum payment. On the other hand, if you reaffirm your loan, you will be subject to post-bankruptcy loan obligations. We will discuss the viability of keeping your property in light of all the options when you call us at (813) 200 4133.
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Filed under Chapter 7 (Tampa) by on Feb 1st, 2012. Comment. 
It is not uncommon for close family members to transfer ownership of assets to one another. It is also common for one family member to own assets by proxy in the name of another family member. But before you do such things, you should be aware of the sticky issue of ownership should bankruptcy take place.
Let’s consider a hypothetical situation. John Doe has bad credit but his sister, Jane Doe has excellent credit standing. John desires to buy a car but because of his bad credit record, he is not able to secure financing, so he asks his sister Jane to purchase the vehicle in her name. John even pays the down payment and promises to pay the monthly installments so that Jane does not have to fork out a single dime.
All goes well for a few months until Jane runs into problems of her own. Let’s say she runs into massive financial difficulties, loses her job and incurs high medical costs for a chronic and serious illness. She is no longer able to clear her debts and files for bankruptcy. Another hypothetical scenario can be Jane is an innocent spouse whose husband has absconded leaving her straddled with huge back taxes she is liable for because she and her husband are joint filers of their income taxes. The IRS might even file a levy on her properties (including the car she bought in her name). Again, the situation is critical and Jane is forced to file for bankruptcy protection.
In these hypothetical situations, the car immediately becomes part of the bankruptcy estate. This means the car might be sold to help pay off Jane’s debts. She cannot transfer the ownership back to her brother because it is not allowed and the bankruptcy trustee would simply reverse the transfer if she tried to do so.
The only way for John to obtain ownership of the car is to buy it back from Jane. Even if the car is fully paid up, as long as it is still under her name, John cannot lay any claim to it. The bankruptcy trustee does not take into consideration who has been paying the monthly installments or maintaining and using the car. As far as the trustee is concerned, the car belongs to Jane because it officially says so on paper.
So if this type of incident happens to you, you should be aware of the legal implications of ownership of assets.
Are you facing huge debt problems? Consider filing for bankruptcy protection to avoid losing your assets and get your creditors off your back. Call us at (813) 200 4133 for a free consultation.
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Filed under Chapter 7 (Tampa) by on Jan 31st, 2012. Comment.
It is not uncommon to get ripped off when making a purchase of certain goods or being overcharged when hiring someone for services. In many industries there are no governing regulations and prices are generally dependent upon market forces. But unlike other industries, the legal industry insofar as bankruptcy is concerned has its fees governed by law.
The bankruptcy judge has the right to determine the fees charged by bankruptcy attorneys to some extent. Section 329 of the bankruptcy code gives the judge this power. In fact, it is legally binding for the bankruptcy attorney to declare his fees to the court. The court then reviews the charges and decides if the fees charged are unreasonable. Being required to do this causes many bankruptcy lawyers not to charge excessively for their services.
But there are no hard and fast figures that determine if a fee charged is excessive. Among the things the bankruptcy judge takes into account in deciding whether fees are reasonable are the complexity of the case, the competence and skill of the lawyer and the amount of work the lawyer did in the case. A long-drawn or complicated Chapter 13 bankruptcy would warrant a higher fee than a straightforward Chapter 7 case. If the attorney solved difficult problems for the client, set out creative strategies or filed correct petitions, the charges can be higher.
If the judge determines that the fees charged are excessive, the onus is on the lawyer to prove otherwise, failing which the lawyer has to lower his fees.
So if you are contemplating filing for bankruptcy but are hesitant to do so because of affordability issues, it’s time to put aside such concerns. Call us at (813) 200 4133 for a free consultation on how bankruptcy can give you a new lease of life financially by eliminating your debts.
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Filed under Chapter 7 (Tampa) by on Jan 30th, 2012. Comment.
How to List an Omitted Creditor in Bankruptcy
When you file for bankruptcy, you have to submit the list of your creditors to the bankruptcy court. This listing contains the names and addresses of all your creditors. This is the list reviewed by the bankruptcy judge and used to pay off your creditors either through liquidation of your assets in Chapter 7 bankruptcy or payment plan in Chapter 13 bankruptcy.
You will have the opportunity to review the list before it is lodged with the bankruptcy court. During this time, if you notice any inaccuracies or any creditor that has been omitted, you should rectify it with your bankruptcy lawyer.
However, if you overlooked a creditor and submitted the list with one or more creditors missing, you can still have the creditor included. But you have to file an amendment. In most cases, when you file for an amendment you will have to complete a new schedule list to show all creditors including the creditor that was omitted. For this, you will incur an amendment fee.
If you have exited bankruptcy and had your debts discharged and discover you have omitted a creditor, you may still have the debt owed to this creditor discharged provided it was incurred before you filed for bankruptcy. If the creditor attempts to collect on the outstanding debt, you may have to reopen your bankruptcy case.
If you are in such a situation, call us at (813) 200 4133 for a free consultation.
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Filed under Chapter 7 (Tampa) by on Jan 27th, 2012. Comment.
Healthcare these days is getting more expensive. Your medical bills are usually unsecured debt. And the peculiar thing about medical debt is that they are ongoing, especially the expensive ones. You see the doctor and you are directed to have additional tests and treatments, followed by consultations with specialists and then come the prescription charges. Should your medical bills increase to the point where they are a debt you cannot bear, you may want to consider filing for bankruptcy.
Usually, it is advisable to seek other means of paying medical debts before filing for bankruptcy. You can look around for more reasonable medical fees, discounts on medicines or seek the help of non-profit advocacy groups. But suppose you have already taken these steps and still find yourself drowning under the weight of medical debts. Then you should consider bankruptcy.
The thing about medical debt is that it is not likely you will be allowed to file for bankruptcy only to clear your medical bills alone. You would be required to include all other debts also, including back taxes, credit card debts, personal loans etc.
It is strongly advisable for you to seek the legal counsel of a bankruptcy lawyer to discuss the timing to file for bankruptcy. As I mentioned above, medical debts are ongoing and bankruptcy only discharges your medical debts incurred up to the point of your bankruptcy filing. So if you file for bankruptcy too early you may be left with a large amount of medical bills incurred after the bankruptcy that cannot be discharged.
So call us at (813) 200 4133 for a free consultation on how to best eliminate your medical debts (and other debts) through bankruptcy.
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Filed under Chapter 7 (Tampa) by on Jan 27th, 2012. Comment.
