https://www.nytimes.com/2020/11/07/your-money/student-loans-bankruptcy.html Originally appeared on The New York Times  It’s an extremely difficult debt to discharge, and only a few hundred people a year even try. Here are the stories of some who succeeded —mostly.With two mortgages, three children and $83,000 in student loan debt, the financial strain finally became too much for George A. Johnson and Melanie Raney-Johnson.New bills kept piling up: The couple had to buy another car when Mr. Johnson wrecked one in a snowstorm, but their insurance didn’t fully pay off the totaled vehicle. Old debts never seemed to get any smaller, either: A mortgage modification they spent months working on fell through when the bank lost their paperwork.And their student debt, an albatross born of aspiration, grew heavier each month.Bankruptcy was the only way out.“It was not an easy decision,” Ms. Raney-Johnson said of filing for bankruptcy in 2011. “It was a feeling of despair, for sure.” Bankruptcy gives over 700,000 debtors a fresh start every year. Bills for credit cards and medical expenses can be wiped away by a few strokes of a judge’s pen, and debts that don’t vanish are reduced.But student loan debts don’t go away as easily. For decades, politicians have slowly made them harder to discharge, while differing standards in courts across the country mean a debtor’s chances can depend on where he or she lives.The few debtors who attempt it are subjected to a morality play unlike anything else in the world of personal finance: so-called adversary proceedings, where they must lay themselves bare in court as opposing lawyers question how much they pay for lunch or give to their church.The Johnsons tried anyway. They had borrowed about $45,000 for Mr. Johnson’s degree in sociology at the University of St. Mary in Kansas and Ms. Raney-Johnson’s pursuit of a bachelor’s degree from the University of California, Davis. Unable to pay, they had received permission to put off their payments, but their balance nearly doubled as interest charges continued to pile up.Mr. Johnson lost his job after they filed for bankruptcy and, unable to afford a lawyer, Ms. Raney-Johnson prepared their case. She remembers how she felt when they arrived at the Robert J. Dole Federal Courthouse in Kansas City, Kan., on a sunny September day seven years ago.“My heart was beating, and I was sweating,” said Ms. Raney-Johnson, now in her mid-40s and a billing supervisor for a federal agency.In 2015, the year the Johnsons got their ruling, 884,956 personal bankruptcy cases flowed through the courts. Only 674 sought to discharge student debt, according to a recent analysis by Jason Iuliano, assistant law professor at Villanova University.The New York Times reviewed dozens of cases in which a judge issued a published opinion — the Bankruptcy Class of 2015 — to understand the pains and payoffs five years later. Some debtors are on a better course. But for others, the struggles never went away — or came back after they thought they were free.Rising Costs, Rising DebtsBankruptcy begins with debt, and student loans are the second-biggest form of household debt in the United States. More than 43 million borrowers hold over $1.6 trillion in student loans, a sum that has more than tripled in 13 years. It exceeds what Americans owe on credit cards or auto loans and trails only mortgages.Sixty-two percent of students who graduated from nonprofit colleges in 2019 had student loan debt, according to an Institute for College Access & Success analysis. Their average balance was $28,950 — not including borrowing by their parents.Many struggle mightily to pay: Before the government’s coronavirus relief efforts paused federal student loan payments, 7.7 million borrowers were in default and nearly two million others were seriously behind.The solution has been a public-policy patch job.About eight million additional borrowers use income-driven repayment plans, which can be challenging to enter.  And while the plans lower payments, borrowers accrue interest on the unpaid difference. The debt is eventually forgiven — usually after 20 or 25 years — but the forgiven amount is taxable income. A related program forgives the federal student loan debts of public-service workers, tax free, after 10 years, but it has been deeply troubled. Borrowers have made payments for years only to learn they were in the wrong kind of payment plan. It got so bad that Congress had to create a separate pot of money to try to fix it.The election could give momentum to a change: President-elect Joseph R. Biden Jr. — who supported a 2005 law that made private student loans harder to discharge — has vowed to change the loan rule back if elected. But few Republicans have voiced support for a plan to change bankruptcy rules. A House bill  has one Republican co-sponsor, Representative John Katko of New York, but the Senate's version, led by Senator Richard J. Durbin of Illinois, has only Democratic support.All the student debt poses a problem. Its weight, experts say, has macroeconomic effects, dragging on homeownership and small-business formation. But the fallout goes beyond simple economics.There is also a mental toll.  Noelle DeLaet said she had sent out hundreds of résumés but couldn’t get a better-paying job.Credit...Terry Ratzlaff for The New York Times‘No Way Out’ Noelle DeLaet earned a bachelor of fine arts degree from Nebraska Wesleyan University in 2008 — the teeth of the Great Recession. She tacked on another year for a degree in English to make herself more attractive to employers. Perhaps in publishing, she thought.She left school with $110,000 in debt: roughly $27,000 from the federal government and the rest in private loans co-signed by her mother. The $810 monthly bill, set to climb when the payment plan on one private loan expired, soon overwhelmed her.Ms. DeLaet, now 34, landed in the child welfare field as a foster care review specialist in Lincoln, Neb. — rewarding, but not lucrative. She sent out hundreds of résumés for better-paying jobs and pleaded with her lenders to reduce her payments. Soon, the creditors started in on her mother and put her on the verge of bankruptcy, too. Ms. DeLaet’s breaking point came in May 2012 when she ran up against the $4,000 limit on her credit card while trying to buy a burrito at a Mexican grocery. She felt so helpless at times that she considered suicide.“I looked all over Google for some sort of support group for others going through this,” Ms. DeLaet said. “I felt like there was no way out.” When Ms. DeLaet squared off in court against her student-loan creditors, they quibbled with the $12 she spent each month on recycling. She should have tried harder for a promotion, they argued. Or moved somewhere else for more money.Judge Thomas L. Saladino bristled at that idea. In his opinion, he wrote that she lived in the state’s second-largest city, “as good a place as any to seek a better-paying job.”The judge discharged about $119,000 in private loans, and an additional $23,000 was forgiven by one of her lenders. But her $27,000 in federal loans stuck: She’s paying those back through an income-driven repayment plan costing about $260 a month. Because she works at a nonprofit, her debt should eventually disappear via the Public Service Loan Forgiveness program.For Ms. DeLaet, the process was worth it: She has married her boyfriend, had two children and bought a home. Her mother is an “amazing” grandmother, she said, although they still cannot discuss the past. “It is an untouchable subject,” she said.Rumors and RulesThe transformation in the bankruptcy rules began in 1976, with unfounded rumors.A handful of legislators claimed to have heard about a parade of young doctors and lawyers who were trying to game the system and shed their debts while embarking on lucrative careers. The lawmakers toughened the rules, largely preventing borrowers from seeking a discharge within five years of graduation. The rules only got tougher over the next three decades.Borrowers must show that their student loans are an “undue hardship” — a standard interpreted differently, depending on where you live. Some judicial circuits, including those in Nebraska, where Ms. DeLaet filed, have the judge review a “totality of the circumstances” for the debtor and make a decision.Other jurisdictions employ a less flexible standard, the Brunner test, named for the case that established it. Judges must answer three questions affirmatively to discharge the debt. First, has the debtor made a good-faith effort to repay the loans? Second, is the debtor unable to maintain a minimal standard of living while making the payments? And, finally, is the debtor’s situation likely to persist?But even jurisdictions that use the Brunner test apply it differently. Some require the judge to find that the borrowers have a "certainty of hopelessness" in paying off their debt. Other jurisdictions do not.Here, the Johnsons may have benefited from geographic good fortune.‘Virtual Lifetime Servitude’Lawyers for the Educational Credit Management Corporation — a nonprofit that collects defaulted loans on behalf of the federal government — examined how the Johnsons spent their $2,100 monthly income.Every expense was scrutinized, including Ms. Raney-Johnson’s $35 monthly union dues, her $100 retirement contribution and $215 to repay loans from her retirement plan. None, the nonprofit’s lawyers argued, were necessary to maintain a “minimal standard of living.” In his opinion — written more than a year after hearing arguments — Judge Robert D. Berger disagreed. He wrote that the U.S. Court of Appeals for the 10th Circuit, which covers Kansas, had shifted from the most rigid interpretation of the three-part test, which he described as “an unfortunate relic.”Judge Berger wasn’t sure how the Johnsons were subsisting at all based on their income, and he said courts shouldn’t rely on “unfounded optimism” about a debtor’s future.“It is disconsonant with public policy and bankruptcy’s fresh start to leave debtors in virtual lifetime servitude to student loans,” he wrote.The judge discharged their student loans: $83,000 in debt, wiped away.“I was ecstatic,” Ms. Raney-Johnson said of the moment she received the decision letter. “I probably said some curse words.”Their good fortune didn’t last.  Pam Monroe saw education as a way to obtain independence she hadn’t had before.Credit...Joseph Rushmore for The New York TimesLaughs Over Lunches Opposing lawyers — whether they work for the federal government or for private lenders — are tenacious. Their approach can feel like bullying, if not humiliation.When Pamela Monroe went to an Arkansas bankruptcy court in 2015, she was 57 with a student-loan balance of about $56,000. She was working in the fragrance section of a Dillard’s department store, and her lunch habits — like $6.10 at Taco Bell and $12.72 at Olive Garden — were a focus of intense interest. Eating out, Ms. Monroe testified, was her primary form of recreation and a midday necessity: Co-workers would sometimes steal colleagues’ lunches from the break room.“They laughed about that when I told them,” she said. “I felt at that moment like I was a cornered animal and they were poking sticks at me.”Ms. Monroe said she had spent her life making choices that others seemed to dictate — marrying two years out of high school and becoming a mother, as her parents seemed to want. After two divorces, she reached for higher education in a bid for independence.She graduated from the University of Arkansas-Fort Smith with a communications degree and pursued a master’s in speech language pathology. She didn’t finish that program, leaving her with the debt but not the advanced degree. And she couldn’t seem to break out of low-paying work.“I would have loved to pay them back,” Ms. Monroe said. “But I never could, because nobody ever saw any value in me.” Judge Ben Barry found Ms. Monroe’s restaurant spending excessive, but noted that she had changed jobs frequently seeking higher pay. Her income, he wrote in his opinion, about doubled between 2010 and 2015, to over $26,000.But even a reduced budget he outlined would not leave her enough money to make her student loan payments, so he discharged just over half of her student loans.She would most likely have been paying that off until she was in her 80s. But last year, Ms. Monroe, now 63 and dealing with osteoarthritis and other health problems, received a disability discharge for the rest of her debt.Now all she wants to do is live out her days in her $510-a-month apartment in a retirement community. “It has a sprinkler system and an elevator, very safe,” she said.But she hasn’t stopped thinking about the way the system and its actors — like the lawyer on the opposite side in her case — seemed to render judgment on her life choices.“I didn’t do anything wrong,” she said. “I was just living, but I got in trouble for eating.”Back to Haunt ThemIn 2016, the Johnsons learned their loan discharge was being appealed by lawyers for Educational Credit Management Corporation.Paradoxically, they were worse off because their financial situation had improved: Ms. Raney-Johnson earned a promotion, and Mr. Johnson, now in his mid-40s like his wife, found a stable government job. A year after discharging their loans, Judge Berger concluded that the couple could now “easily” maintain a minimal standard of living and reinstated their debt — which had ballooned even more because of interest charges.Preparing to send their own children to college, the Johnsons requested another forbearance. Their balance continues to grow: It’s roughly $104,000 today.Ms. Raney-Johnson took the final class she needed for her biology degree over the summer. But the debt was already piling up for the next generation. Their oldest, a college sophomore, expects to owe about $45,000 when she graduates. Their middle child, a high school senior, is looking at colleges now. Ms. Raney-Johnson said she and her husband — who are putting about $5,000 a year toward their daughter’s tuition — would try to remain in forbearance for now.In August, they received a notice about an income-driven repayment plan, which would start out costing about $550 a month. From there, the cost depends on many factors, including job changes, raises and eligibility for forgiveness programs. If they’re able to get into the public service program, the debt could go away a decade after they start paying. If not, the bills could continue coming for about 20 years — right around the time the Johnsons will be trying to retire.The experience, Ms. Raney-Johnson said, has been “disheartening.” She and her husband had run up against opposition that could keep going with little regard for time or expense, knowing that they couldn’t.“It feels like getting screwed over by someone with a lot more power and money,” she said.

Involuntary bankruptcy cases are where creditors file a petition to put a debtor into bankruptcy. They can be filed against individuals, as well as entities. When people think of an involuntary bankruptcy petition against an individual, celebrities and the fallen “well to do” come to mind. People don’t think of their neighbor, who defaulted their first or second mortgage a year or two ago. The Covid-19 pandemic has seen states restricting foreclosure actions. This is frustrating mortgagees holding mortgages where the debt exceeds the property’s value. So, they are using an alternative remedy, to get control of their collateral: involuntary bankruptcy cases. We have seen individual involuntary cases filed in a “bad faith” effort to avoid regular debt collection processes. They can be dismissed with the petitioners sanctioned severely. However, it is possible to file one, in good faith, and put someone into bankruptcy. The summons in an involuntary bankruptcy petition is served by first class mail. People mistakenly think that service was improper because the summons was not hand delivered. If you receive a summons, in any manner, don’t ignore it. Doing so can result in your defaulting in the proceeding. Then you start losing rights. Regaining those rights costs money. For some, the involuntary petition should be contested and fought, due to the dire consequences to them. For others, it may be the realization of the inevitable. Every case, like every person, has its idiosyncrasies. If you receive a summons issued by a bankruptcy court, contact a bankruptcy lawyer to discuss your rights and options. The post Individual Involuntary Bankruptcy Cases Are Coming appeared first on Wayne Greenwald, P.C..

If just one person in the marriage is filing bankruptcy, we still need a whole family budget. The question comes up all the time.  “Can I file bankruptcy and leave my wife/husband out of it.” The answer to that is, Yes. But to get your case approved, we need to submit a whole family budget. […] The post If one of you is filing, we still need a whole family budget by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.

   In a fairly egregious factual situation, a bankruptcy court in Massachusetts awarded debtor's counsel $17,302.50 in fees and $261.60 in costs for correcting a mortgage company's minor error that in turn lead to an attempt by the mortgage to charge the debtor $130,000 in improper debt.  In re Miralda, case No 09-10853-MSH, 2020 Bankr. LEXIS 3006 (Bankr. D.Mass. 27 October 2020).    The matter originated from a chapter 13 case filed by Mr. Miralda on 2 February 2009.  GMAC Mortgage held a second mortgage on the debtor's home.  The debtor had attempted to strip the 2nd mortgage, asserting that there was no equity above the amount owed on the 1st mortgage.  This resulted in a stipulation between Mr. Miralda and GMAC Mortgage, drafted by counsel for GMAC Mortgage, agreeing to 6 monthly installments of $966.70 to pay a total of $5,870.18 to GMAC Mortgage, upon receipt of which GMAC would withdraw it's claim and discharge the mortgage.  While all payments were made timely, there was a math error in the computations such that the total payments were $179.98 short of the stipulated total due of $5,980.18.  Mr. Miralda completed the plan and received a discharge on 2 January 2013, at which time his case was closed.  Mr. Miralda dis not deliver a mortgage discharge or or withdraw their claim.  In July 2019 Mr. Miralda started receiving demands from GMAC's successor mortgage holder.  Only then did he and his counsel discover the math error.  Mr. Miraldo promptly sent payment for the $179.88 shortfall and requested a discharge of the mortgage.  Franklin, servicer for GMAC's successor, refused to accept the payment or issue the discharge, asserting that the stipulation had not been complied with due to the $179.88 shortfall, instead insisting on payment of the $130,000 balance due on the 2nd mortgage, given no payments for the nearly decade between completion of the 6 stipulated payments and the date of such discovery.  Mr. Miralda reopened the bankruptcy case to seek an order confirming that the mortgage debt had been satisfied, and requesting fees and costs.  Franklin opposed the relief.  At an initial hearing in November 2019 the court cautioned Franklin that if the evidence showed Mr. Miralda had acted in good faith under the stipulation, the court would award fees and costs to Debtor.    Instead, despite not contesting the salient facts, Franklin choose to go to trial including interrogatories, request for production, and initiating pretrial motions.   Upon the filing of motions for summary judgment by both parties, the court granted the request for fees and costs by debtor, requiring the filing of an affidavit by counsel as to such charges.  An itemized billing affidavit was filed, requesting $17,402.50 in fees and $261.60 in costs with an average fee of $255.17.  Franklin challenged at least 40 of the 72 entries in the billing, requiring debtor to offer a point by point rebuttal.  The court found that fees would be allowed under the lodestar method as set forth in 11 U.S.C. 330(a)(3).  This method selects factors determining reasonable compensation including the rates charged, the amount and reasonableness of time expended, the necessity or benefit to the case, and the experience and skill of counsel in bankruptcy practice1.  Given primary counsel's 35 years of relevant experience, the court found his $300/hr rate reasonable, and found the $250/hr rate of the other counsel for debtor, with 7 years experience, also reasonable.  The court found only one entry to be disallowed as unreasonable, unnecessary, or inefficient: a $100 charge to correct a deficiency in the service of a motion.  The other entries meet the requirement for allowance, and were sufficiently detailed and reasonable that counsel's productivity may be easily assessed.  The time spent by counsel prior to executing a new fee agreement is also compensable. The court did deny a request for an additional $750 for time spent in responding to Franklin's opposition to the fee request, as the court did not find such opposition to be frivolous.  The case points out the risk of continuing litigation by creditors after being warned by the courts of standards they are unlikely to be able to meet, as well as the benefit of debtor's counsel continuing to represent their client long after the case is over if problems arise.1 Lopez v. Consejo de Titulares del Condominio Carolina Court Apartments (In re Lopez), 405 B.R. 24, 30 (B.A.P. 1st Cir. 2009).↩Michael Barnett, Esq.Michael Barnett, PA506 N. Armenia Ave.Tampa, Fl 33609-1703 813 870-3100https://hillsboroughbankruptcy.com       

 https://www.djournal.com/mbj/record-number-of-small-business-bankruptcy-filings-signal-covid-19-distress/article_5ccdcae6-13ab-11eb-8ccf-d37eb8a883c1.htmlOriginally appeared on Mississippi Business JournalA record number of small businesses based in Mississippi filed for protection under Chapter 11 of the U.S. Bankruptcy Code during the second quarter of 2020.That, of course, was when the coronavirus pandemic struck and the first lockdowns and restrictions were put into place across the nation.Chapter 11 allows businesses to reorganize while reaching an acceptable payout to creditors.There were 29 such filings in the second quarter, compared with six in the year-earlier period, according to U.S. bankruptcy data.Such businesses received a stroke of legislative luck when President Trump signed a bipartisan bill that became known as the Small Business Reorganization Act in August 2019, well before the coronavirus struck in March. The act contains Subchapter V, which was subsequently amended by Congress to increase the maximum debt to $7.5 million, up from $2.75 million for one year, till March 27, 2021 under the CARES (Coronavirus Aid, Relief and Economic Security) Act to benefit debtors, as well as creditors.The number of cases in Mississippi are not big, but they belie a much broader toll on smaller businesses.Dawn Starnes, director of the National Federation of Independent Business in Mississippi, said that “most of our businesses” are family owned and don't file for bankruptcy protection – they just close.Ten or fewer employees is typical of membership, she said.The smallest of businesses keep a tight rein on their balance sheet and manage their inventory closely, though “a lot of folks are just hanging on,” Starnes said in an interview.Thus far, in the lower end of the business community there has not been a noticeable rise in bankruptcies, Starnes said.The Payroll Protection Program, which granted qualified applicants $605 a week but which expired in early August, was a major help, she said.Efforts to renew the program are being pursued, she said, but action looks doubtful till after the presidential election, she said.Two-thirds of NFIB members file their taxes as individuals, she said.In 2020, 97 percent are privately owned and comprise 47 percent of the private work force.Most of the NFIB members in Mississippi have fewer that 50 employees, she said.One of those small companies that has filed is Quality Welding and Fabrication Inc. in Columbia.At it peak, Quality Welding and Fabrication had 125 employees.That's before crude oil and natural gas prices dropped dramatically and demand for the company's tanks accordingly, said owner Kenny Breakfield.The viral epidemic-induced slowdown in the economy curtailed production of crude oil in Mississippi by 50 percent, compared with a year earlier, according to Dr. Sondra Collins, senior economist for the state Institutions of Higher Learning.

https://nypost.com/2020/10/22/brooklyn-roasting-company-files-for-bankruptcy-will-close-its-shops/ Originally appeared on New York Post The pandemic has hit another beloved Big Apple hot spot.Brooklyn Roasting Company, known for its colorful logo and flavorful coffee, filed for bankruptcy protection on Thursday and said it’s planning to permanently close its remaining retail locations at 50 W. 23rd St. and at 25 Jay St. in Dumbo Brooklyn, according to its Brooklyn bankruptcy court documents.It will keep three other Brooklyn locations open, including at 200 Flushing Ave. and 45 Washington Ave., a spokesman said.The company is also hoping to save its wholesale business, however, which sells to New York institutions like Columbia University and Goldman Sachs as well as the airports.Founded in 2009 by Jim Munson, a former partner in The Brooklyn Brewery, BRC became a beloved New York brand with as many as seven locations across the city at its peak.But its problems began before the pandemic as the company over-expanded in an effort to be acquired, according to the filing.The coffee roaster had been in discussions in 2018 to be acquired for $22 million by an investment group including the former chief executive of Dunkin’ Donuts, the filing states. At the behest of its investors, BRC invested in new real estate and staff, but the acquisition never happened.By the beginning of 2019, “BRC’s financial condition was poor,” and revenues declined for the first time in 2018 to $9.7 million, according to the filing.Just as the company was getting its footing back — with revenues climbing to $10.3 million in 2019 — the pandemic wiped out more than half of the company’s retail sales. It’s wholesale business was also decimated.It reported an “extraordinary COVID expense” year to date without providing details about the debt.BRC received a $727,000 in federal stimulus loans, but the money ran out in August even as its sales remained “severely depressed,” according to the filing. Munson controls 13 percent of the company, the filing said.“This was a one two punch,” said distressed asset expert Adam Stein-Sapir. “They had a failed acquisition and all the additional costs they signed up for in anticipation of that and then Covid.”

How to Avoid a Foreclosure when Filing for Bankruptcy Most people have a mortgage that lasts for 30 years. There’s a lot that can happen in 30 years. You can lose your job, you can become seriously ill or injured and rack up hundreds of thousands in medical debt, or you can struggle to make ends meet and get over your head in debt. You may find that you have fallen behind on your mortgage payment, and now you owe so much that you are at risk of the house falling into foreclosure. Filing for bankruptcy in Arizona may be able to help you avoid foreclosure, depending on what your other finances look like. Here’s what you need to know: Chapter 7 Bankruptcy Chapter 7  bankruptcy is the “clean slate” bankruptcy that most people think of when they think of filing. However, it applies to unsecured debts, such as personal loans, medical bills, and credit card debts. It doesn’t apply to secured debts like mortgages or car loans. You won’t be able to discharge your missed mortgage payments by filing Chapter 7 bankruptcy in Mesa. However, if you have decided that you don’t want to stay in the house, you can allow the bank to take the house and you can discharge what is left over. Chapter 13 Bankruptcy Chapter 13 bankruptcy is what’s known as a debt reorganization plan, and it’s the right choice if you want to keep your home. Rather than discharging debt, this chapter of bankruptcy puts your debt into a new payment plan – one that you can afford, based on your finances. The plan would include all the money that you owe your mortgage lender, and it would allow you to get current on your mortgage. The Chapter 13 debt repayment plan lasts for three to five years, depending on what you owe and what you negotiate with the bankruptcy court. At the end of that time, you may not have paid off everything you owe. If that is the case, the court may discharge what remains. Sometimes, you may carry more than one mortgage or line of credit related to your home. For example, you may have taken out a home equity loan to try to manage your debts on your own. If that is the case, you may have more debt tied up in your home than what your home is now worth. You may then be able to petition the court to strip these loans from your home, thereby making them unsecured debt. The value of the home doesn’t match the value of the debt, so the debt isn’t exactly secured. If the court agrees to your request, you may be able to discharge that debt entirely. You won’t be able to discharge your mortgage, but you may be able to discharge a second mortgage, home equity loan, or similar line of credit. Talk to a Bankruptcy Attorney Every bankruptcy filing is different because every person’s situation is unique. The best way to know what kind of bankruptcy will work for you – or even if bankruptcy will work for your goals – is to talk with an experienced Mesa bankruptcy attorney. An attorney will closely study your finances and determine the best path of action based on all the nuances and complexities of your case. For example, your home may have already moved into foreclosure, or you may be considering a short sale. Your bankruptcy attorney in Mesa can help you understand how bankruptcy can affect those and other situations. The most important things for you to remember is that you should never resign yourself to inaction. Though your circumstances may feel hopeless at times, they are not. There is a path forward that can help you get your finances under control and get you out from the weight of overwhelming debt. Call My AZ Lawyers today to learn more about how bankruptcy may help you. Our bankruptcy attorneys have been representing individual and business clients for many years, and they can handle even the most complex cases. We are committed to helping you find the best resolution as quickly as possible, and our attorneys are here to offer compassionate guidance at every step of the way. Call us today to schedule a consultation with a bankruptcy attorney and learn more. Arizona Offices: Mesa Location: 1731 West Baseline Rd., Suite #100 Mesa, AZ 85202 Office: (480) 448-9800 Email: info@myazlawyers.com Website: http://myazlawyers.com/ Glendale Location: 20325 N 51st Avenue Suite #134, Building 5 Glendale, AZ 85308 Office: (602) 509-0955 Tucson Location: 2 East Congress St., Suite #900-6A Tucson, AZ 85701 Office: (520) 441-1450 Avondale Location: 12725 W. Indian School Rd., Ste E, #101 Avondale, AZ 85392 Office: (623) 469-6603 The post How to Avoid a Foreclosure when Filing for Bankruptcy appeared first on My AZ Lawyers.

How to Avoid a Foreclosure when Filing for Bankruptcy Most people have a mortgage that lasts for 30 years. There’s a lot that can happen in 30 years. You can lose your job, you can become seriously ill or injured and rack up hundreds of thousands in medical debt, or you can struggle to make ends meet and get over your head in debt. You may find that you have fallen behind on your mortgage payment, and now you owe so much that you are at risk of the house falling into foreclosure. Filing for bankruptcy in Arizona may be able to help you avoid foreclosure, depending on what your other finances look like. Here’s what you need to know: Chapter 7 Bankruptcy Chapter 7  bankruptcy is the “clean slate” bankruptcy that most people think of when they think of filing. However, it applies to unsecured debts, such as personal loans, medical bills, and credit card debts. It doesn’t apply to secured debts like mortgages or car loans. You won’t be able to discharge your missed mortgage payments by filing Chapter 7 bankruptcy in Mesa. However, if you have decided that you don’t want to stay in the house, you can allow the bank to take the house and you can discharge what is left over. Chapter 13 Bankruptcy Chapter 13 bankruptcy is what’s known as a debt reorganization plan, and it’s the right choice if you want to keep your home. Rather than discharging debt, this chapter of bankruptcy puts your debt into a new payment plan – one that you can afford, based on your finances. The plan would include all the money that you owe your mortgage lender, and it would allow you to get current on your mortgage. The Chapter 13 debt repayment plan lasts for three to five years, depending on what you owe and what you negotiate with the bankruptcy court. At the end of that time, you may not have paid off everything you owe. If that is the case, the court may discharge what remains. Sometimes, you may carry more than one mortgage or line of credit related to your home. For example, you may have taken out a home equity loan to try to manage your debts on your own. If that is the case, you may have more debt tied up in your home than what your home is now worth. You may then be able to petition the court to strip these loans from your home, thereby making them unsecured debt. The value of the home doesn’t match the value of the debt, so the debt isn’t exactly secured. If the court agrees to your request, you may be able to discharge that debt entirely. You won’t be able to discharge your mortgage, but you may be able to discharge a second mortgage, home equity loan, or similar line of credit. Talk to a Bankruptcy Attorney Every bankruptcy filing is different because every person’s situation is unique. The best way to know what kind of bankruptcy will work for you – or even if bankruptcy will work for your goals – is to talk with an experienced Mesa bankruptcy attorney. An attorney will closely study your finances and determine the best path of action based on all the nuances and complexities of your case. For example, your home may have already moved into foreclosure, or you may be considering a short sale. Your bankruptcy attorney in Mesa can help you understand how bankruptcy can affect those and other situations. The most important things for you to remember is that you should never resign yourself to inaction. Though your circumstances may feel hopeless at times, they are not. There is a path forward that can help you get your finances under control and get you out from the weight of overwhelming debt. Call My AZ Lawyers today to learn more about how bankruptcy may help you. Our bankruptcy attorneys have been representing individual and business clients for many years, and they can handle even the most complex cases. We are committed to helping you find the best resolution as quickly as possible, and our attorneys are here to offer compassionate guidance at every step of the way. Call us today to schedule a consultation with a bankruptcy attorney and learn more. Arizona Offices: Mesa Location: 1731 West Baseline Rd., Suite #100 Mesa, AZ 85202 Office: (480) 448-9800 Email: info@myazlawyers.com Website: https://myazlawyers.com/ Glendale Location: 20325 N 51st Avenue Suite #134, Building 5 Glendale, AZ 85308 Office: (602) 509-0955 Tucson Location: 2 East Congress St., Suite #900-6A Tucson, AZ 85701 Office: (520) 441-1450 Avondale Location: 12725 W. Indian School Rd., Ste E, #101 Avondale, AZ 85392 Office: (623) 469-6603 The post How to Avoid a Foreclosure when Filing for Bankruptcy appeared first on My AZ Lawyers.

Read Our Bankruptcy Lawyer Reviews! More than 800 Five-Star Reviews from People Like You   Reviews for Bankruptcy Law Office of Robert Weed 814 customer reviews Average rating:5   5 Laura M. Jones,… There are no words to express our gratitude for the care, attention and expertise demonstrated by this wonderful, caring lady. Laura went […] The post Reviews Just reviews by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.

When you file bankruptcy, they make it hard to pay your car payment. Be prepared to use the mail. You file bankruptcy and you want to keep your car. You know that means you need to keep paying. Seems like the car finance people would welcome your payments; but they make it hard. That may […] The post When you file bankruptcy, they make it hard to pay your car payment by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.