TOP 5 REASONS WHY PEOPLE FILE BANKRUPTCY

bankruptcy

Bankruptcy ultimately comes down to more money going out than coming in.  That mismatch is caused by many things, but here is a list of the most common reasons why consumer debtors file for bankruptcy protection:

  1. Medical Expenses
  2. Job Loss
  3. Excessive Use of Credit
  4. Divorce/Separation
  5. Unexpected Expenses

If you are currently experiencing one or more of the above-listed items, you may want to consider consulting an attorney as to whether bankruptcy might be the solution for you.

ATTORNEY ADVERTISING — PAST RESULTS DO NOT GUARANTEE FUTURE OUTCOMES

We are a debt relief agency, we help people file for Bankruptcy under the Bankruptcy Code. This Blog is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney-client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

WHAT CAN I DO IF MY CREDITORS ARE STILL GARNISHING ME AFTER I FILED MY BANKRUPTCY CASE?

wage-garnishment

You filed your bankruptcy case to put an end to garnishments.  You know that the automatic stay comes into effect upon the filing of your bankruptcy petition.  The automatic stay is automatic, and does not require a further order of the bankruptcy court.  You also know that the automatic stay stops wage garnishments.

Nevertheless, you get your first paycheck after you file for bankruptcy and the garnishment has not stopped!  The same deduction, for the same amount?  What happened?  Why did it happen?  And what can be done about it?

While it is true that the automatic stay is “automatic” and immediate, and does not require further order of the court, creditors will continue to garnish and conduct other recovery activities until they actually learn of the bankruptcy case.  It may take as long as ten days before a creditor receives written notice of your case.

In addition, because most creditor collection activity is conducted by huge army of people, it may take another several days before the right person at the creditor gets actual notice of the filing.  In other words, a process in motion stays in motion until something is done to stop it.  Putting the brakes on requires knowledge of the case.  Knowledge, unfortunately is not instantaneous.

That is why I always send notice of the filing directly to garnishing and foreclosing creditors by whatever means will get the notice in front of the right people at the creditor as quickly as possible.

But what if the creditor with notice of the filing continues to garnish in violation of the automatic stay?  This is a more serious problem that requires immediate action by your attorney.  In the case of creditor who willfully violates the automatic stay, you may be entitled to recover financial compensation occasioned by the violation,plus costs and attorneys’ fees.  Contact your attorney immediately if you continue to be garnished after you file your bankruptcy case.

If you would like to learn more about garnishments (income executions) under New York law, or how to use bankruptcy to put a stop to garnishments, email me tzink@mccarthyfingar.com for free copy of some white papers I’ve written on the topics.

ATTORNEY ADVERTISING — PAST RESULTS DO NOT GUARANTEE FUTURE OUTCOMES

We are a debt relief agency, we help people file for Bankruptcy under the Bankruptcy Code. This Blog is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney-client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

 

HOW OFTEN CAN I FILE FOR CHAPTER 7 BANKRUPTCY?

chapter-7-bankruptcy

This question is asked often: “I filed chapter 7 in October of 2008 [the month and year vary] and got my chapter 7 discharge in February of 2009 [variable, depending on the date of filing]. I need to file again, but someone told me I had to wait eight years to file a new petition. Is that true, and if so, is the 8 years measured from the date of filing, or the date of discharge?”

Consumer debtors are entitled to only one chapter 7 discharge every eight years. An individual can file for chapter 7 relief more frequently, but if the case is filed less than eight years after the preceding chapter 7 filing, the debtor will not be entitled to a discharge in the latter case.

Because the discharge is the principal reason for filing bankruptcy, it generally makes little sense to file until the day after the 8th anniversary of the prior case. And it is the date of filing, not the date of discharge that is controlling. Accordingly, if you filed your prior chapter 7 before this date 8 years ago, you may file for chapter 7 relief again today with the expectation of receiving a brand new chapter 7 discharge.

For more information on how bankruptcy can help, contact us at 914-385-1032 or tzink@mccarthyfingar.com

ATTORNEY ADVERTISING — PAST RESULTS DO NOT GUARANTEE FUTURE OUTCOMES

We are a debt relief agency, we help people file for Bankruptcy under the Bankruptcy Code. This Blog is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney-client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

DO I HAVE TO GET CREDIT COUNSELING BEFORE I FILE MY BANKRUPTCY CASE AND, IF SO, HOW DO I GET COUNSELING?

credit-counseling

The 2005 amendments to the Bankruptcy Code added a requirement that all individual debtors must get a briefing from an approved non-profit budget and credit counseling agency within the 180 day period ending on the day the bankruptcy petition is filed. The United States Trustee’s Office maintains a listing of approved agencies on its website. The information can be obtained by clicking here.

The briefing may take place over the telephone, on the Internet or in person. Most agencies charge between $25 to $50 dollars for the briefing, but many agencies will waive the fee for debtors who cannot afford it. The briefing may be obtained from various agencies on an emergency basis if the debtor needs to file for immediate bankruptcy protection.

The briefing takes about an hour during which a budget of the debtor’s income and expenses may be prepared. At the conclusion of the briefing, the agency will provide the debtor with a certificate of completion. The certificate of completion must be filed with the petition in most districts.

The only exceptions to counseling requirement is if the debtor is incapicitated, disabled, or on active duty in a combat zone. A debtor is “incapicitated” for this purpose if the debtor is so impaired by mental illness or deficiency as to be incapable of realizing and making rational business decisions regarding his or her financial obligations. A debtor is “disabled” if he or she is so physically impaired as to be unable to participate in an in-person, telephone or Internet briefing.

Every effort should be made to obtain the briefing before filing the bankruptcy case. If not, the debtor must complete the briefing within 30 days of filing and must be able to demonstrate to the court that the debtor had to file for bankruptcy immediately due to exigent circumstances, and the debtor requested the briefing but was not able to obtain the counseling within seven days of the request.

If you are struggling to pay your bills and cannot seem to get ahead because of too much debt, contact my office for-in person consultation 914-385-1032, during which we will discuss bankruptcy, credit counseling, and other ways to improve your financial situation.

ATTORNEY ADVERTISING — PAST RESULTS DO NOT GUARANTEE FUTURE OUTCOMES

We are a debt relief agency, we help people file for Bankruptcy under the Bankruptcy Code. This Blog is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney-client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

When Bankruptcy May Not Be Appropriate for the Hopelessly Insolvent Consumer Debtor

monopoly-bankruptcy

Bankruptcy can provide several benefits under the right circumstances.  Thus, for example, the discharge of indebtedness available under chapter 7 is one of the principal reasons a person hopelessly burdened by too much debt would want to file for bankruptcy protection.  In some situations, however, bankruptcy may not be the right choice.  What follows are several situations where bankruptcy may not be helpful.

  1. A person who is totally collection proof will not achieve any significant benefit from the filing a chapter 7 case because creditors can do no real harm to them.  A person is “collection proof” if the person has no nonexempt assets that a creditor can attach or levy upon to pay down the debt.
  2. A person who is likely to fall further into debt as the result of medical bills or continuing financial problems may not achieve any real benefit from a chapter 7 bankruptcy. It may be better for these individuals to delay filing pending some indication that the incurrence of additional debt will abate in the future.
  3. A debtor that has few debts and strong defenses may be better served by litigation or settlements outside of bankruptcy court.
  4. Persons with decent income but too much debt might be better off scaling back their lifestyle and making more frugal purchase decisions.

In most of the foregoing situations, a client may be best advised that bankruptcy will almost always be available later and that a bankruptcy now may prejudice the right to file for bankruptcy in the future.  On the other hand, some clients may want immediately the peace of mind attendant to having debts discharged and being able to proceed with the “fresh start” that is provided by that discharge.  In any event, the client who can no longer pay his or her bills is better served by a careful consideration of the available options, including not filing immediately for bankruptcy.

If you are struggling to make ends meet because of too much debt, and there’s little hope in sight, call my office 914-385-1032 to make an appointment.  We’ll explore together whether bankruptcy might provide you with the help you need.

ATTORNEY ADVERTISING — PAST RESULTS DO NOT GUARANTEE FUTURE OUTCOMES

We are a debt relief agency, we help people file for Bankruptcy under the Bankruptcy Code. This Blog is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney-client relationship between you and the Blog publisher. The Blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.