Archive for August, 2014

Crucial Question for our Logan Clients: What is Chapter 7 Bankruptcy?

Chapter 7, or a  “straight bankruptcy,” is usually the quickest  type of bankruptcy, but it can also handle more complicated debt problems.   The Most Common Type of Bankruptcy Chapter 7 bankruptcy is what most people think of when they hear “consumer bankruptcy.” More Chapter 7s cases by far are filed than under any other Chapter. In Utah for the period between June 2013 and June 2014 there were 9,219 Chapter 7 cases filed out of 14,012 or about 66%.  In 2013, about 68%—a little more than 2/3rds—of all bankruptcies filed in the U.S. were Chapter 7s. About 31% were Chapter…

Crucial Question for our Cache Valley Clients: Can Bankruptcy Help with Child and Spousal Support Arrearage?

Chapter 13 protects you while you catch up on support, unlike Chapter 7.   Chapter 7’s Very Limited Help Regular Chapter 7 bankruptcy does only one thing to help if you are behind on your child or spousal support payments: it gets rid of your other debts so that you can better catch up on the support. If you are behind and your ex-spouse or the local support enforcement is starting to garnish your wages or bank accounts, or is threatening to take away your driver’s license, or your occupational or professional license, this is the only way that Chapter…

Crucial Question for Logan Utah Clients: Can Chapter 7 “Straight Bankruptcy” Help with My Support Obligations?

A regular Chapter 7 case can help you pay your support obligation in a limited but straightforward way. Is it enough for what you need or is Chapter 13 necessary?    Child and Spousal Support: Ways Chapter 7 Does NOT Help As our last blog post made clear, support obligations are an extraordinary type of debt which cannot be discharged (legally written off) with any kind of bankruptcy. One of the most important other tools of bankruptcy—the  “automatic stay,” which prevents creditors from pursuing you and your assets, also does not apply to support obligations under Chapter 7, as to either…

Crucial Question our Logan Clients Ask: Can Bankruptcy Write Off or Reduce My Support Obligations?

The Simple Answer is No. The bankruptcy can’t change the support decisions of your divorce court, but bankruptcy can still help.   Child and Spousal Support: Very Special Debts Support obligations are an extraordinary type of debt. Support is treated in the bankruptcy law as virtually sacred, with more protection for the “creditor” than any other category of debt. Bankruptcy Does Not Write Off Support If you owe child or spousal support based on a separation or divorce decree, or some other court order, you cannot discharge (legally write off) that obligation in any kind of bankruptcy. Some kinds of divorce-based…

Crucial Question: Can Bankruptcy Protect Me from My Logan Utah Co-Signer?

If you and another person are jointly obligated on a debt, you won’t truly have a fresh start unless you prevent the other person from pursuing you.   Protecting Your Co-Signer The last two blog posts have been about ways to protect your co-signer from having to pay the co-signed debt. They both involved paying the debt in full yourself, with the help of bankruptcy. Under Chapter 7, you discharge (legally write off) all or most of your other debts so that you can afford to pay the co-signed debt under its usual terms. Under Chapter 13 and its special…

Crucial Question: How Can I Protect my Cache Valley Co-Signer Better in a Chapter 13 “Adjustment of Debts” Case?

If you have a co-signer in the Cache Valley you want to protect, the “co-debtor” stay is a unique and powerful tool.    The Limits of Chapter 7 Our last blog post was about helping your co-signer under Chapter 7. You can prevent your co-signer from having to pay the co-signed debt by filing a Chapter 7 “straight bankruptcy” to discharge (legally write off) all your debts and then paying the co-signed debt. Once you have no other debts, or only a couple of them, that may improve your financial situation enough so that you could afford to make payments on…

Crucial Question: Can I Protect my Utah Co-Signer Even in a Chapter 7 “Straight Bankruptcy”?

The Chapter 13 “co-debtor stay” is a powerful tool for protecting your co-signer. But sometimes Chapter 7 takes care of this more simply.    Concerns about Bankruptcy Hurting Your Co-Signer If you are considering bankruptcy you may be reluctant to file because of the impact you fear it will have on a co-signer or anyone else jointly obligated with you on a debt. That’s an honorable concern. You don’t want to hurt someone who has helped you. However, the practical reality is that in many situations the best way to not hurt a co-signer is to file bankruptcy so that you…

Our Logan Clients Often Ask This Crucial Question: If I File Bankruptcy Do I Have to Appear in Court?

Almost never. You do need to attend a 5-to-10-minute informal (by court standards) meeting, accompanied by your attorney, which is usually straightforward.   If you have a court appearance in another court besides the bankruptcy court, you may or may not have to attend.  That is the subject of another post.  Here we discuss whether you will have to  attend court in your bankruptcy case. The Bankruptcy Court Your bankruptcy case is filed in and administered by the U.S. Bankruptcy Court. That’s because the U.S. Constitution gave the federal government the right and responsibility to create bankruptcy laws. But you…

Crucial Question: Will My Logan Utah Employer Be Informed If I File Bankruptcy?

Not if you file under Chapter 7, but more likely under Chapter 13. However, job discrimination based on filing bankruptcy is illegal.   Chapter 7 “Straight Bankruptcy” The majority of bankruptcies are filed under Chapter 7. These cases usually last less than four months. Normally only your creditors are informed about your case. There is no reason for your employer to be told about it, and in most situations employers are not informed and do not find out. The most likely exception is if your wages are being garnished by a creditor. Your attorney may need to notify your employer’s payroll…

Crucial Question for Cache Valley Debtors: What Unexpected Creditors Should I Include in My Bankruptcy Case?

Include all possible creditors in your bankruptcy schedules, even if you are not sure who you owe or whether you owe at all.    Legal Obligation to List All Creditors Our last blog post was about whether you are obligated to list a particular creditor on your bankruptcy creditor “schedules”—whether you can exclude anyone.  Today’s is about who to list in order to cover all your debts—whether you should include someone you might not think to do so. You are required by law to list all debts in your bankruptcy case.  But in doing that, it’s often smart to include those…