Source: http://dianedrain.com/category/consumer-issues/page/21/
Timestamp: 2017-04-30 03:13:33
Document Index: 792049795

Matched Legal Cases: ['§521', '§1325', '§1325', '§362', '§ 301', '§362', '§362', '§1322', '§1325', '§707', '§341']

Consumer Issues Archives | Page 21 of 21 | Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney
What is Bankruptcy Intended to Accomplish?	August 16, 2012/0 Comments/in Bankruptcy, Bankruptcy Attorneys, Bankruptcy Videos, Business bankruptcy, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Consumers, Creditors, Debt Relief Agencies, Payday and other usury loans, Small Businesses, Student Loans, Trustee Sale and Foreclosure Videos /by Diane Drain
What is Bankruptcy? What it Intended to Accomplish? What are the Different Chapters?
Diane Drain2012-08-16 18:15:182017-02-25 19:13:45What is Bankruptcy Intended to Accomplish?	Chapter 13 Questions	August 16, 2012/1 Comment/in 2005 Bankruptcy Abuse Prevention and Consumer Protection Act "BAPCPA", Bankruptcy Attorneys, Bankruptcy Videos, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Consumers, Creditors, Student Loans /by Diane Drain
A chapter 13 bankruptcy is extremely difficult for everyone in the best of circumstances. Obviously, bankruptcy is the not the best of circumstances. The failure rate is at least fifty percent for debtors who have very experienced chapter 13 attorneys. According to statistics from the Arizona Bankruptcy Court the success rate for those who do not have attorneys or use inexperienced bankruptcy attorneys is less than 2%. That means a failure rate above 98% of all their chapter 13 cases. You want to do this right at the beginning and not be a guinea pig for some document preparer or inexperience attorney. I am not saying this to scare you or to solicit your business, I say it so that you will not be surprised.
Be Aware of the Deadlines!Failure to comply with these deadlines will most likely result in the dismissal of the bankruptcy case. (§521(i)(1).
Before Filing a Chapter 13 Bankruptcy Case:– Click on title below to expand for the answer
How does a Chapter 13 work? The Debtors file documents called Petition, Schedules, Statement of Affairs, along with some other documents with the Bankruptcy Court. These documents are reviewed by the Chapter 13 Trustee and other creditors. In addition to the documents the Debtors also file a Plan of Reorganization. This is called debt adjustment. The intention is that over the next 3 to 5 years the Debtors will pay all the disposable income (income minus allowed expenses- some trustee have expense guidelines and Census Bureau and IRS Data) to their creditors by way of the Bankruptcy Trustee. At the end of their Plan period their remaining debts will be discharged, unless they are non-dischargeable.
Who is Eligible for a Chapter 13? In order to file for a chapter 13 you must:
What is the Roles of an Attorney in a Chapter 13 Bankruptcy Case? The Bankruptcy Court tells me that less than 2% of those filing without an attorney can ever be successful in a chapter 13. This statistic pre-dates the 2005 Reform Act, which dramatically increased the complexity of filing for bankruptcy protection. Many people ask me if they “can file their own bankruptcy”. I always answer “Yes, anyone has the legal right to do their own open heart surgery, so why not not their own bankruptcy!” (Thank you Judge Baum for the quote). The laws were complicated before they changed in 2005, now I believe that only an fool would file their own bankruptcy, no matter “how simple”. In fact, after the law changed many lawyers stopped doing any bankruptcy law because it had become so complex; event fewer will help with chapter 13. Never listen to the advise of someone who filed their own bankruptcy. They had a “fool for a client” and probably committed at least one federal crime, but did not get caught. The new laws are being aggressively enforced and the Attorney General’s Office is actively pursuing bankruptcy fraud.
What is the Role of the Bankruptcy Trustee? The Trustee acts as the disbursing agent for the payments made into the plan. The Trustee also reviews the plan and challenges those plans that don’t, in the Trustee’s opinion, meet the tests for confirmable plans set out in the Bankruptcy Code. An experienced bankruptcy attorney will be able to predict most of the Trustee’s objections and address them them in the Plan, or amended Plan. The 2005 Reform Act puts much of this into question. It will take several years to work out what the new law really means. If the Trustee and the debtor can’t agree on the terms of the plan, a judge will decide if the plan can be confirmed.
What is the Means Test? The means test was explained in the Chapter 7 FAQ. In a chapter 13 it is complicated because of a change in the definition of “disposable Income”. §1325(b)(2) The form used is Official form B22C. The problem is that the disposable income test, under either 7 or 13 median income approach, will not be an accurate measure of future ability to pay in the Plan. The test is a look back, not forward in time. In addition to other deductions, charitable contributions, up to 15% of gross income, is included §1325(b)(2)(A)(ii). Our firm will provide you a form for calculating the means test.
What Classes Must be Taken before and During the Bankruptcy? Every consumer who files Chapter 7 or 13 bankruptcy is required to take a credit counseling “briefing” within 180 days PRIOR to filing their bankruptcy and file a certificate of compliance. There is also a financial management class a “budget” class within 45 days after filing your bankruptcy. Failure to do so will result in additional fees and costs in order to get your discharge in your bankruptcy. There will be fees charged for those classes, unless you cannot afford to pay such fees. Ms. Drain will explain the process.
What is the Automatic Stay? The filing of the petition creates an automatic stay under 11 U.S.C. §362 prohibiting all collection actions. 11 U.S.C. §§ 301, 302, 101(42) – unless the Debtor has filed a prior bankruptcy in the last 12 months. Stay good for only 30 days if filed one prior case in last 12 months. §362(c)(3)(A). No stay at all if 2 or more cases in last 12 months. §362(c)(4)(A)(i) A dismissed case is a filed case. No excuse for failure to understand the requirements. A motion to extend the Stay must be filed within 30 days
A copy of the plan will be mailed by BNC to all creditors and (in some cases) appear at a Plan Confirmation hearing that is usually between 20-45 days after the meeting of creditors. The contents of the Plan are dictated by §1322 – which requires the Debtor submit all “disposable income” income, minus certain allowed expenses, to the Chapter 13 Trustee for the next 3-5 years. (§1325(b)(2)) “Disposable Income” is not defined the same in a chapter 13 as in a chapter 7. The length of the Plan is dictated by several issues too numerous to list in this brief outline of duties.[/vc_column_text][/vc_accordion_tab][vc_accordion_tab title=”Exemptions in Chapter 13″][vc_column_text]The bankruptcy code allows each individual who files bankruptcy to keep basic assets deemed necessary for the debtor’s “fresh start” after bankruptcy. That property is referred to as the debtor’s “exempt property”.
What happens if I own property that is not Exempt? If your case involves assets which are not exempt, then you must pay the fair market value of those assets through your Chapter 13 Plan. In other words, your creditors have the right to receive the amount they would have received if you liquidated those assets through a Chapter 7. You are obligated to protect those assets until the Trustee can make arrangements to pick them up. Your creditors will be notified by the Trustee to file a proof of claim. The Debtor, Trustee and other creditors have the right to examine the proof of claims and object to those they deem to be improper. All claims not objected to by the Trustee, you, or another creditor will be approved by the court and the creditors will receive a pro-rata share of whatever the Trustee has distributes, after paying other specified debts (child support, secured debts, etc).
What is the cost of Chapter 13? Attorneys fees in Chapter 13 are usually paid in part before the case is filed, with the unpaid balance, if any, paid by the Trustee from the payments the debtor makes into the plan. In Arizona the normal flat fee for a consumer chapter 13, without any issues, is $4,500 for the 3-5 year Plan. If the case is more complex or there are excessive objections to confirmation, claims, or you fail to keep the on-going house payments or Trustee payments current, then there will be additional attorneys fees. The debtor’s attorney may charge for their services by the hour. It is important to talk to the attorney about this issue.
I am told by other clients that my fees are a lot less than those charged by other firms, especially the TV advertising firms (many of which have filed bankruptcy after taking their clients money. These firms charge more than double in fees and who use strong-armed tactics to bully people to retain their services. Why? I can do this only if my clients gather information in an orderly fashion by filling out as much of the requested information as pertains to their situation. If a client provides me with only part of the requested information, then my fees will have to increase for that client because I am forced to do more of the client’s work. So, the client who fails to provide the names, dates, addresses, and/or amounts on the questionnaire will be charged more for the additional attorney time than the client who does their portion of the work without my intervention. That does not mean you should not ask questions. Thoroughness and accuracy are of utmost importance in a properly filed bankruptcy. Inaccurate paperwork can cause you to lose your bankruptcy protection, cost you more in attorney fees defending fraud claims and you may face jail time for bankruptcy fraud. My job it to help you avoid all those problems. So, thoughtful and organized questions are encouraged.
How does filing bankruptcy affect my credit rating? The filing of a bankruptcy generally means that your credit rating will most likely go to 480, but each person situation is unique. A chapter 13 is an open bankruptcy for 3 to 5 years. During the pendency of that bankruptcy your credit score can increase so long you keep your Plan payments and monthly mortgage payments current. It is not unusual that a Debtor obtain a new loan during their chapter 13. Warning – you must obtain court approval for any new loans, sales of assets or purchase or new large-dollar assets. Make certain that the new loan does not cost you more than staying with your current obligation.
Will news of my bankruptcy be published? When your bankruptcy papers are filed, they become public records. The record of your filing may be published by some credit-reporting agencies. In addition, your name will be published in one newspaper in Arizona, and possibly more. However, your name will be listed on a page with hundreds of other debtors, so your name will probably not stand out.
Must my employer be told I am filing for Bankruptcy? Typically – no. There are two issues that may involve you employer. First, the bankruptcy Trustee will request that you provide copies of several documents (tax returns, bank statements, etc). One of these items will be copies of some of your pay stubs before filing. If you refuse to provide this information then the Trustee may send a form to your employer seeking information about your wages. Second, the basic foundation of a chapter 13 is the monthly Plan payment made to the Bankruptcy Trustee. In some cases a wage assignment of those Plan payments may be required by the Court, the Trustee or your circumstances. Each situation is unique. The law prohibits your employer using the mere filing of a bankruptcy to deny you employment, unless you work in financially sensitive areas (securities, brokers, etc).
By filing bankruptcy do I lose any of my rights, such as the right to vote? No. Bankruptcy is a civil, not a criminal proceeding. You do not forfeit any of your civil or constitutional rights by filing a bankruptcy. Also, neither a utility, a governmental unit, nor your employer may discriminate against you because you have filed bankruptcy. But, if you discharge a utility bill then you may find that you are charged a very large “deposit” when you apply for new utility service.
Time Periods and Deadlines in Chapter 7 and 13 Bankruptcy Time Periods and Deadlines in Chapter 7 and 13 Bankruptcy Cases
During Chapter 13 Bankruptcy:– Click on title below to expand for the answer
What are the Debtor’s Duties in a Chapter 13? The Debtor may not submit any documents to the Bankruptcy Court until the Debtor is certain that the information is (1) well grounded in fact; and (2) warranted by existing law or a good faith argument for the modification of the existing law. Rule 9011 In other words, someone who is representing himself or herself in a bankruptcy is held to know the bankruptcy and state laws that apply to their situation. Ignorance of the law is no excuse. The Debtor’s attorney must make the same avow regarding the information provided by the Debtor. Sanctions can be awarded under §707(b)(4).
What is the role of the Trustee? The Trustee acts as the disbursing agent for the payments made into the plan. The Trustee also reviews the plan and challenges those plans that don’t, in the Trustee’s opinion, meet the tests for confirmable plans set out in the Bankruptcy Code. An experienced bankruptcy attorney will be able to predict most of the Trustee’s objections and address them them in the plan, amended plan or modified plan (this is filed after the Court confirms the plan). The 2005 Reform Act puts much of this into question. It will take several years to work out what the new law really means. If the Trustee and the debtor can’t agree on the terms of the plan, a judge will decide if the plan can be confirmed.
What do I file if I am self-employed and in a chapter 13? Every debtor who is self-employed or operating a business must file a monthly financial report known as a “Business Operating Statement”. The term self-employed includes a person who operates a business, whether full or pert time, or with another person. Also, a person who is an independent contractor, subcontractor, works on a a contract labor basis, or any other work where taxes are not deducted from the pay received, is deemed self-employed for the purpose of filing the operating statement. The trustee will give the Debtor a copy of the business operating statement, along with instructions.
Can I buy a house while in a Chapter 13 bankruptcy? There is no one answer to this question – it depends on the lender, the trustee and the court. But, at the very least you first must obtain advice from your attorney. Plus you will need permission from the Trustee and the Court before embarking on this adventure. Some predatory lenders will be happy to charge you very high interest rates to buy a house. The longer you wait in your chapter 13, the better interest rate you can be offered. After 18 months of perfect payments to your Chapter 13 Trustee and to your mortgage lender, then most good lenders will probably extend a new loan.
Can I modify my home loan while in bankruptcy? Yes, but you must obtain permission from the Bankruptcy Court and the Bankruptcy trustee before the lender will approve the loan modification. The Bankruptcy Court cannot make the lender modify the loan. Make sure that the loan modification will be financially beneficial before going this route.
Can I Get Rid of My Second Mortgage? Possibly, but this depends on several factors. This process is called a “lien strip”. You need to determine the value of your home, the amount of debt owed to the first mortgage, including arrears. You also need to know the amount owed to any other secured creditors, such as homeowners’ association, real property taxes, etc.
What about my tax refund check? Any right that you had to a tax refund at the time of filing the bankruptcy is an asset of your bankruptcy estate and belongs to your Trustee. At the time that you get your tax refund check, you must turn that check over to the Trustee. In a chapter 13 most likely you will be required to surrender 3 to 5 years of refunds. Rethink why you are getting a refund check. By overpaying your taxes you are losing the opportunity to use those funds for your own purposes. The best solution is to calculate your wage deductions based on your current situation. Don’t use your refund check as a “savings account” because you will not be able to use it in that manner.
The Chapter 13 Plan: – Click on title below to expand for the answer
How does the Plan of Reorganization work? In addition to several requirements the plan must meet two tests:
Payments through the plan The debtor must make the first payment on the plan within 30 days of the filing of the plan and each month thereafter. Payments begin before the first meeting of creditors (the §341 meeting) and continue even while objections to confirmation are pending. Payments must be made in certified funds, such as money orders or cashiers checks, or by voluntary wage or checking account deduction. If you stop making plan payments the Trustee will ask that your case be dismissed.
Can creditors object to the plan? Yes, but only certain creditors. Normally the secured creditors’ objections are limited to the value of the secured item or the dollar amount you are scheduled to pay through the plan. They can object only if they contend the plan does not meet the best interests of creditors test and the best efforts test, or if they contend the debtor has not proposed the plan in good faith. The trustee can raise any objection that a creditor could raise. Under the Reform Act of 2005 the creditors may have more grounds for objection (required payments, prior discharges, etc.)
Amending the Plan Before Confirmation The plan must meet the tests for plan confirmation. Sometimes, the amount of money to be paid into a plan must be increased, where the claims that are actually filed and allowed are greater than estimated at the beginning of the case.
The Confirmed Plan Once the plan is confirmed, it binds all the parties: the creditors must accept the payments provided; the values given in the plan for the secured portion of claims are fixed; and the debtor’s payments over the life of the plan are fixed, unless the debtor’s circumstances change and the plan is modified.
Requesting a Moratorium on Plan payments There are times that the Debtor may be unable to pay the monthly Plan payments. This failure must be as a result of serious, short term changes in the Debtor’s income or some unusual, but necessary, expense. A moratorium can be filed with the Court and served on all the creditors. There may be hearing, the Trustee will need to approve the moratorium. Again, the entire length of the Plan cannot exceed 60 months, including any moratoriums.
Modifying the Confirmed Plan Plans can be changed if there is a change in income, through job loss or illness. Plan payments can be lowered or the percentage paid to creditors changed if the debtor’s income or expenses in the future won’t fund the plan as originally confirmed.
Converting the Chapter 13 to Chapter 7 The Debtor may consider converting their case to a chapter 7 if their situation changes (income and/or expenses) or they change their mind about trying to save their home or pay required debts. Converting a case is one that must be done with forethought because there can be serious consequences.
After a Chapter 13 Bankruptcy, Including Discharge:– Click on title below to expand for the answer
How often can I file a chapter 13? Only individuals, who have complied with the Bankruptcy laws and completed their chapter 13 Plan, can receive a chapter 13 discharge. An individual cannot receive a discharge in the 13 if they received a discharge in 7, 11 or 12 in the past 4 years before filing the current case, or in a chapter 13 in the last 2 years before filing the current case. 1328(f).
What is a Discharge in Bankruptcy? Discharge is the court’s order stating that you do not have to pay your debts to the creditors that were listed in your bankruptcy documents, so long as the court did not entered a non-dischargeability order. Other debts that are not discharged under the current laws include student loans, child support, alimony/maintenance, government fines or penalties, most taxes and a few others.
How will I receive my discharge? Usually by mail, unless you have asked for electronic notification. In some states there may be a court hearing, which you must attend, where the court will explain the meaning of the discharge, or the reasons for denying your discharge, if it is not granted. Arizona does not have this discharge hearing, unless yours is a very unique situation.
What debts are not discharged in a chapter 13 bankruptcy? Understand that this area of law changes. Debts that are listed here may be or not be discharged, depending on your circumstances. In addition, a chapter 13 discharge will eliminate some debts that are not discharged in a chapter 7 bankruptcy.
A Discharge may be Revoked Your discharge can be revoked for several reasons. Some include failure to comply with a court order, bad faith or fraud.
Are my out-of-state debts discharged in bankruptcy? Yes. Bankruptcy is a federal proceeding and the bankruptcy court has the jurisdiction and power to discharge debts contracted anywhere in the Country, whether in or out of your state of residence. Of course, there are certain debts that cannot be discharged in bankruptcy.
Follow The StepsTo schedule your Free Bankruptcy Consultation with Diane
Comments from a few of our chapter 13 clients.
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Diane Drain2012-08-16 18:15:182017-02-25 19:55:05Chapter 13 Questions	Index of General Bankruptcy Questions	August 16, 2012/0 Comments/in 2005 Bankruptcy Abuse Prevention and Consumer Protection Act "BAPCPA", Bankruptcy Videos, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Collection companies & Debt buyers, Consumers, Credit Report, Debt Relief Agencies, Document Preparers, Payday and other usury loans, Student Loans /by Diane Drain
This web site is not intended to replace the advice of an experienced bankruptcy attorney. It is impossible to answer everyone’s questions, but some basic information information is included. Please understand that it is very important for you to obtain legal advice regarding your particular situation.
Half of the calls we receive start with the statement “this is a simple bankruptcy”. The caller does not understand that bankruptcy is not simple — it is like open heart surgery. If the surgeon is good then the surgery will go as planned, but if there are complications or the surgeon does do a good job the consequences can result in the unnecessary loss of thousands of dollars. Do not use document preparers or attorneys who do not practice bankruptcy law full time. As the attorney for references, for years of practice, check them out with the State Bar and with AVVO and LinkedIn.
Diane L. Drain, attorney, law professor and counselor
Most Arizona consumer bankruptcy lawyers offer free or very low cost initial consultations. Talk to the attorney (not their paralegal) and determine if they know the answers to your questions and if their personality fits your needs. By the way – bankruptcy is a constitutional right. Educating yourself about your options, including bankruptcy, is a very smart choice.
– Benjamin Franklin General Information
See the answer to each of the following questions:
What is Bankruptcy and how does it work? (this link will take you to a page with the following information)
Why are some attorneys true professionals and others like used car salesmen (TV and some internet advertising firms)?
Can I file for bankruptcy if I am not a citizen or do not have my own social security number?
Can I file bankruptcy if my debts are being administered by financial counselors?
Will there be forgiveness of debt “income” as a result of a bankruptcy?
(this link will take you to a page with the following information)
Selling Property then Filing Bankruptcy
What Happens at a Bankruptcy Meeting of the Creditors?
Your Bankruptcy Has Been Filed – Now What?
The Discharge and Problems Related to a Discharge
What is a Discharge and how do I get one in a Chapter 7?
The granting of a discharge does not stop the Debtor’s involvement in their case.
By law there are certain debts that are not dischargeable in bankruptcy
Now That Your Bankruptcy is Over
How Do I Survive After Filing a Chapter 7? (article written by a out-of-state paralegal)
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Diane Drain2012-08-16 18:15:182017-03-28 01:47:34Index of General Bankruptcy Questions	General Review of Bankruptcy	August 16, 2012/0 Comments/in 4. a Videos, Bankruptcy, Bankruptcy Attorneys, Bankruptcy Videos, Business bankruptcy, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Consumer Issues, Consumers, Creditors, Document Preparers, Small Businesses /by Diane Drain
Usery - Past and Present USURY: traced back 4,000 years. But it has always been despised, condemned, restricted or banned by moral, ethical, legal or religious entities. The oldest references to usury are found in religious manuscripts of India, dating back to 2000-1400 BC where the ‘usurer’ is associated with any interest lender. In the Hindu Sutra (700-100 BC) as well as in the Buddhist Jatakas (600-400 BC) there are many references to the payment of interest, along with expressions of disdain for the practice. Vasishtha, a prominent lawmaker of the era, drafted a law that banned the high caste Brahmans and Kshatryas from being usurers or money-lenders. In the second century AD, the term usury becomes relative, meaning that interest above the legal rate could not be charged; that would be a usurious loan.
Creditors must take some responsibility Very few of us have the ability to completely control the financial part of our lives. Companies fail, jobs are lost, people get sick and families are broken. The creditors are happy to give everyone credit, whether or not they qualify. These creditors have absolutely no regard to the person’s ability to repay the credit. The creditor makes more money when a borrower is late, defaults on a loan, or overdraws the credit limit or bank account. Therefore, that creditor is gambling that they will earn more from borrowers in interest, penalties and additional charges then that creditor will lose as a result of bankruptcy. They are leveraging their losses by giving out as much credit as everyone’s mail boxes can hold. Those same creditors will not work with the a borrower who is suffering a financial set back. That creditor does not care if the borrower has never been late. All that creditor wants is “their money”. Don’t believe me – just ask their collection agents. Today, it is an extremely rare creditor to have any loyalty to their customers.
Follow the steps	Articles on bankruptcy issues and questions
Diane Drain2012-08-16 18:15:182017-03-14 00:35:48General Review of Bankruptcy	Consumer & Bankruptcy Resources	August 16, 2012/0 Comments/in Bankruptcy Attorneys, Bankruptcy Videos, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Consumer Financial Protection Bureau, Consumers /by Diane Drain
Diane Drain2012-08-16 18:15:182017-01-28 18:44:26Consumer & Bankruptcy Resources	Disclaimer	August 16, 2012/0 Comments/in Bankruptcy, Consumer Issues, Consumers, Creditors, Real Estate, Small Businesses /by Diane DrainDisclaimer
Diane Drain2012-08-16 18:00:082016-12-29 18:41:03Disclaimer	Bankruptcy & Consumer Issues	June 5, 2012/in Bankruptcy, Bankruptcy Videos, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Consumer Issues, Document Preparers, General Videos /by Diane DrainRelated Post Removing a Judgment after Bankruptcy Bankruptcy and family size – Unfair treatmen… Laws.com interview with Diane about her history by… Richard S. Berry, Why Pay a Lawyer, Pleads Guilty … BEWARE: Payday Loans and Deposit Advances Diane received AVVO 2014 Top Contributor Award
Diane Drain2012-06-05 18:45:112016-12-30 16:41:44Arizona Trustee Sales & ForeclosuresPage 21 of 21«‹192021