Chapter 7

Published on: September 26, 2011

What Is A Means Test?

A means test dictates what chapter of bankruptcy you qualify for. This is a very important part of your case, and a Jacksonville Bankruptcy Attorney will make sure that it is done correctly. The attorney will input your income for the prior six months and then take deductions for the things allowed by law. Knowing what deductions can be taken and how to accurately calculate them is extremely important, as this will lower your disposable monthly income amount.

Your disposable monthly income number is one of the most important things in your bankruptcy case. This number dictates whether you can file for a Chapter 7 bankruptcy or if you must file for a Chapter 13 bankruptcy. Also, if you file for Chapter 13 bankruptcy, your disposable monthly income number will dictate how much money you must pay to unsecured creditors in your Chapter 13 Plan.

The means test can be very tricky, you really need to know what you are doing to get an accurate test. If it is not done correctly, the trustee will file an objection in your case. We offer means testing here at Law Office of David M. Goldman. Contact a Jacksonville Bankruptcy Attorney today for your free consultation.

Published on: September 26, 2011

Median Income in Florida

By David M. Goldman

With few exceptions, qualifying for a Chapter 7 Bankruptcy requires a debtor to show that their household income is less than the median household income for the same family size in their region. These amounts are updated and changed each year by the IRS. In Florida the numbers currently are as follows:

Household Size	Median Income
1	$40,029
2	$50,130
3	$54,594
4	$65,135

*For each additional member beyond 4, add $7,500.

Published on: September 25, 2011

Secured Assets in Bankruptcy

By David M. Goldman

Debtors have three options when it comes to secured assets in a Chapter 7 bankruptcy. The first option may be the most obvious: Surrender. The option of surrender gives the debtor the ability to simply give up their interest in the secured property and pass it back to the creditor.

The next option is to Reaffirm. To Reaffirm a debt, the debtor offers the creditor a contract to allow the debtor to keep the property, often with the same terms as the original agreement. This allows the obligation to “go through” the bankruptcy and often enables debtors to keep their financed cars or homes. However, it is important to note that it is up to both the creditor and debtor to come to this agreement. If for some reason the creditor doesn’t want to reaffirm the debt, no one can make them. For this reason I make sure to advise my clients to be sure they’re up to date on all payments on these secured items going into the bankruptcy to induce the creditor into agreeing. Typically, these agreements do work out.

The final and least used option is Redemption. Redemption is the debtor’s right to purchase the secured property for it’s fair market value at the time of filing. It is important to note that this is not the agreed upon amount in the contract. You may owe $3,800.00 on a car, but if it’s only worth $1,000.00 on the day you file, you can pay the $1,000.00 and satisfy the debt to the creditor. The problem with this option, which is why it’s least used, is that very few people who are bankrupt can come up with the additional money. Still, it is better to have options you have little chance of using than have no options at all. I have also heard of some third-party financing companies who will pay off your Redemption amount if you sign a secured note with them. I have never actually seen this work out for the debtor and it seems counter-intuitive to begin a bankruptcy with a new debt, but as I said before, options are good.
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Published on: September 24, 2011

Bankruptcy before marriage?

By David M. Goldman

Marriage may be a blessed arrangement that brings us together, but with financial problems being one of the most common reasons for divorce, it makes sense to try and clear up any of those issues from earlier in your life before tying the knot.

When BAPCPA (the Bankruptcy abuse prevention and consumer protection act) passed in 2005, new requirements were imposed on debtors wanting to qualify for Chapter 7 bankruptcy. One of those requirements was 11 USC 707(b) or the “means test”. 707(b) requires a debtor to show that their gross income for their family size is less than the median income for a family of the same size in their geographic region. These median income charts are made available through the IRS and are updated annually.

Generally, if a debtor’s household income for their family size is higher than the median, that person is not eligible for a Chapter 7 (liquidation) bankruptcy and must instead file a Chapter 13 (reorganization) bankruptcy. Defining income is usually not difficult, the IRS defines gross income under 26 USC 61, and most everyone has had experience with it as we’ve almost all paid our taxes based on it.

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Published on: September 23, 2011

Keith D. Collier’s Law Office sued for bankruptcy violations

By David M. Goldman

Elena Escamilla, a staff attorney for U.S. Trustee, Donald F. Walton, filed a law suit against Keith D. Collier for violations including: Sanctions for Violation of the Automatic Stay, Injunctive Relief, Violation of Discharge Injunction an Conflict of Interest Resulting in Disgorgement of Fees.

If you entered into a deferred payment plan whereby you made payments after the filing of a Chapter 7 bankruptcy or post-petition payments outside the plan in a Chapter 13, you may not have any obligation to make these payments and you may be entitled to a full refund of all payments made thus far. You should discuss your specific circumstances with a Florida attorney.

This is not the first time Middle District of Florida (which includes Orlando, Jacksonville, Tampa and Ocala) has ruled that actions which appear synonymous are inappropriate. See Walton v. Clark & Washington.

Published on: September 15, 2011

Filing Numbers Down in Middle District of Florida

By David M. Goldman

The Middle District of Florida has Divisional Locations in Jacksonville, Ocala, Orlando, Tampa, and Ft. Meyers. Bankruptcy filings within the Middle District of Florida have dropped 17.2% between January and June, 2011, compared with the same time frame in 2010. Although this seems to be good news for the economy, many people are still faced with outstanding debts that they just cannot handle. Filing for bankruptcy can get you a fresh, new start. If you would like to talk about your options, contact a Jacksonville Bankruptcy Attorney today for a free consultation.

Published on: September 15, 2011

Can I rent a home if I am in Banruptcy in Jacksonville?

By David M. Goldman

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Many Jacksonville clients come to me with the same concern: “I need to get out of my upside-down home mortgage, but who will rent to us after we file for bankruptcy?” Having encountered this question so many times, and in the interest of trying to keep children in the same school district, I have created a list of apartments who are willing to rent to people who are either in bankruptcy or who have recently received a discharge. We provide this list to each of our Chapter 7 and 13 clients. It includes homes or apartments on the Northside, Westside, Southside, Mandarin, Orange Park, Arlington, Atlantic Beach, Neptune Beach and Jacksonville Beach. By no means are these all of the places a client could potentially live. Very few places said that a recent bankruptcy would be an outright bar to renting, though a few would require an increased security deposit.

Published on: September 14, 2011

NFL Star In Trouble In His Chapter 7 Bankruptcy

By David M. Goldman

NFL Star Rick Sanford initially filed for Chapter 7 bankruptcy in February 2009 in South Carolina. Sanford did not list all his assets, however. He failed to disclose his interest in a Colorado condo, which later sold, netting him $70,000.00. When the trustee in Sanford’s case challenged his listing of assets, Sanford withdrew his bankruptcy petition. He was subsequently charged with fraud and plead guilty. The court sentenced him to 2 years probation, 30 days home confinement, and 100 hours of community service.

When filing for bankruptcy, it is very important to be honest and list all of your assets. Oftentimes, your Jacksonville Bankruptcy Attorney can exempt your assets so you can keep them away from creditors.

Published on: September 13, 2011

Toni Braxton Receives Bankruptcy Discharge

By David M. Goldman

Famous singer Toni Braxton filed for relief under Chapter 7 Bankruptcy in September of 2010, listing luxurious personal property items, such as a Porsche, lavish household contents, and expensive jewelry. She claimed around $1.6 million in assets. The judge in her case has now granted her a discharge. This means that she will no longer be liable for certain debts. This is her second bankruptcy preceding since 1998.

To see what assets of yours you would get to keep after filing for bankruptcy, contact a Jacksonville Bankruptcy Attorney today to discuss your specific situation.

Published on: September 12, 2011

My Home Has Been Foreclosed And There Is A Sale Date. What Can I Do?

By David M. Goldman

Filing for bankruptcy will stop the future sale date of your home, even if there has been a final order foreclosing the property. This is due to an automatic stay that is immediately put into place upon filing for bankruptcy. Under the automatic stay, a creditor cannot take any action against you to try and collect a debt. So your foreclosure suit will halt immediately and your sale date will be cancelled; no more action will be taken in the case until the automatic stay is no longer in place.

The automatic stay will be effective until the conclusion of your bankruptcy. In a Chapter 7, this will probably be a short amount of time, around 4-6 months. But this extra time may give you the opportunity to catch up on your mortgage, achieve a modification, or sell your property. However, in a Chapter 13 bankruptcy, your case will not be concluded until after your Plan payments are finished. This will be anywhere from 3-5 years. Within those years, your Plan will allow you the opportunity to catch up on arrearages and so cure your deficiency with your mortgage company.

There are many ways in which a bankruptcy might be in your financial best interest. Help with mortgages that are in default is just one way a Jacksonville Bankruptcy Attorney can help you. Call us today at 904-685-1200 to schedule a free consultation.