Personal Bankruptcy

 

Put Your Debt Problems Behind You for Good by Filing Bankruptcy

 

Chapter 7 Bankruptcy is the most common type of Bankruptcy and is often referred to as a “Liquidation Bankruptcy.” You may want to consider Chapter 7 if you have little property except for the basic necessities like furniture and clothing and/or you have little or no money left after paying basic expenses each month – or you’re not even meeting basic expenses.
 
Some of the advantages of a Chapter 7 Bankruptcy are that almost all unsecured debts can be discharged (completely eliminated). The process of a Chapter 7 Bankruptcy moves quickly – you may receive your discharge in just a few months and creditors can’t contact you while the automatic stay is in effect – or after debts are discharged.
 
An individual who qualifies under the ‘means test’ and completed a required pre-filing session with a credit counselor may file for Chapter 7 bankruptcy protection may file for a Chapter 7 Bankruptcy.

A Chapter 13 Bankruptcy is commonly referred to as a “Reorganization of Debts” or a “Payment Plan Bankruptcy.” You may want to consider Chapter 13 if you have significant equity in a home or other property and you want to keep it and/or you have regular income and can pay your living expenses, but you can’t keep up the scheduled payments on your debts.
 
The advantages to a Chapter 13 Bankruptcy are that you can keep most of your property while spreading out time to pay past due accounts. You can also strip liens on your home in a Chapter 13 Bankruptcy.
 
You’ll have 3-5 years to catch up delinquent accounts according to a schedule that you and the bankruptcy trustee have agreed is workable for you and you’ll make one monthly payment to the bankruptcy trustee for distribution. You’ll have no direct contact with creditors during the protection period of 3-5 years.
 
Individuals whose unsecured debts are below $336,900 and whose secured debts are less than $1,010,650 can file a Chapter 13 Bankruptcy.

With bankruptcy, a debtor can be relieved of the debts they were responsible for. In other words, the debtor is waived from paying those outstanding debts. Unsecured debts can usually be let go, including credit cards or hospital bills.

 

Learn more about discharging debt.

If you own real estate with a second or other subsequent mortgage after your first, chances are you can remove that lien in a Chapter 13 Bankruptcy. This is most common these days as a result of the declining real estate market.
 
With real estate declining as much as it has, most second and other mortgages we see beyond the first are wholly unsecured. In fact, in many cases, we are finding that even the first deed of trust/mortgage on the property is greater than the value of the house.
 
For example: If you home worth first mortgage of $500,000 and a second mortgage of $100,000 and the current value of your home is $400,000 you can remove the second lien wholly because it is considered an unsecured debt in a Chapter 13 Bankruptcy Case. Since the second mortgage of $100,000 is not secured by the value of the real estate anymore, they are considered “wholly undersecured.” The $100,000 second was “stripped” from the property and is treated as an unsecured creditor in the case and is no different than a credit card.
 
So while many people are starting to surrender their real estate back to the bank, think twice before you make your decision and speak with a competant bankrutpcy attorney. You just might be able to remove the second mortgage and keep the house with a more affordable mortgage payment!

The filing of a bankruptcy case, under any chapter of the Bankruptcy Code, triggers the Automatic Stay. The Automatic Stay forces all of your creditors to stop any action by any creditor against the debtor or the debtor’s property.
 
The automatic stay gives the debtor protection from his creditors and brings all of the debtor’s assets and creditors into the same forum, the bankruptcy court, where the rights of all concerned can be balanced.
 
The automatic stay prohibits

As explained in Protection From Creditors, the filing of a bankruptcy case, under any chapter of the Bankruptcy Code, triggers the Automatic Stay. The Automatic Stay forces all of your creditors to stop any action by any creditor against the debtor or the debtor’s property including Foreclosure proceedings.
 
Therefore, if you file Bankruptcy your home will not be sold in a foreclosure sale while the Bankruptcy is pending.
 
Contact Sternberg Law Group for a free consultation to learn more about stopping foreclosures.

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires court approved bankruptcy credit counseling to be completed by debtors prior to filing for bankruptcy within the 180 days immediately preceding the filing of a bankruptcy petition. The course can be completed online and is relatively inexpensive.
 
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires two court approved bankruptcy credit counseling to be completed by debtors prior to filing for bankruptcy within the 180 days immediately preceding the filing of a bankruptcy petition. Both courses can be completed online and are relatively inexpensive.

jzaccardoPersonal Bankruptcy