Chapter 7

Published on: October 1, 2015

Where do I file for Bankruptcy if I recently moved?

If you recently moved to a new state, figuring out where you should file bankruptcy and which exemptions are available to you can be a little confusing. The one thing that remains the same no matter where you live and when you last moved is that you will be filing your bankruptcy in the United States Bankruptcy Court, which is a federal court.

The simplest answer to this question is that if you have resided in your current state for the 180 days prior to filing a bankruptcy, then your current state is the proper place to file. Most states have a few different districts so you would just need to find out which district you are in. It becomes a little more tricky when you have resided in your new state for less than 180 days. If you fall into this classification, then the proper state for you to file your bankruptcy in is the state in which you resided for the greater period of time prior to filing. For example; you have lived in Georgia for the last 10 years, but relocated to Florida 2 ½ months ago. Since you have only resided in Florida for approximately 75 days, it is proper for you to file your bankruptcy in Georgia because you resided there for the majority of the 180 days prior to filing.

Once you have figured out which district you should file your bankruptcy in according to where you live and how long you have lived there, you now need to decide whether you should file bankruptcy now or whether you should wait. If you have just moved to a new state and do not yet qualify to file your bankruptcy in your new state, then you need to look at the exemptions each state offers along with what assets you are going to want to protect when you file. If your old state offers better exemptions that will better protect your assets, then you should probably file sooner rather than later in your previous state. But if your new state has better exemptions that will benefit you more, then you may want to consider waiting to file your bankruptcy until you have resided in your new state for at least 730 days (2 years). If you have resided in your new state for anywhere between 180 days and 730 days, then you will have to use the exemptions of the state in which you resided in for the greater part of the previous 180 days.

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Published on: September 30, 2015

Creditor Harassment During and After Bankruptcy

By Kendal Schoepfer

Creditor Harassment During Bankruptcy

When you file a Chapter 7 or Chapter 13 bankruptcy, something called an automatic stay is put in place as soon as you file. This Automatic Stay prevents your creditors from continuing to try and collect a debt from you, but unfortunately your creditors will most likely not stop harassing you and trying to collect from you the moment you file for bankruptcy. This is because it takes the Bankruptcy Court a few days to prepare your Notice of Bankruptcy and to then mail it to all of your creditors. If, however, your creditors continue to harass you after a reasonable time has passed for them to receive notice of your bankruptcy from the Bankruptcy Court, then they are most likely in violation of the Automatic Stay, provided the debt falls into one of the very limited exceptions: criminal matters, child support, alimony, taxes, certain evictions, ect.

So what should you do if a creditor is still harassing you? The first thing you should do is to let the creditor who is harassing you know that you have filed bankruptcy. You can do this verbally over the phone, or by writing. For example, you can write that you filed bankruptcy on their bill and mail it back to them. Letting the creditor know you have filed bankruptcy stops the contact in the majority of instances. These initial contacts from your creditors shortly after filing bankruptcy are generally just mistakes, which is often due to the creditor’s system not having been updated with the Notice of Bankruptcy they received. It is not yet time to be alarmed, but it is important to keep a log of their contacts with you.

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Published on: September 25, 2015

Civil Judgments and Bankruptcy

By Kendal Schoepfer

A civil judgment is obtained when you fail to pay a debt that you owe, such as a credit card debt, and the creditor/lender files a civil lawsuit against you in state court for a breach of contract. If you fail to respond to the lawsuit and/or do not have a valid defense, a civil judgment is entered against you. If it is a relatively small judgment amount and you do not have a lot of other debt, then it might be best to simply set up a payment plan to pay it off. However, if the judgment amount is large, is more than you can handle, or you have a lot of other debts, then you might want to consider bankruptcy in order to get a fresh start.

The good news is that bankruptcy will discharge the majority of civil judgments entered against you, but there are a few exceptions. It depends entirely on what the underlying debt was for and whether a lien has been placed on your real property. There are certain types of judgments that cannot be discharged with a bankruptcy.

The most common type of civil judgment is a judgment for unpaid debts, such as a credit card, medical bill, rent, repossession or personal loans, just to name a few. If your judgment is for a debt such as one of these, then it is most likely dischargeable through bankruptcy.

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Published on: September 16, 2015

Are you smart for filing Bankruptcy?

By Kendal Schoepfer

Filing for bankruptcy can be a very smart decision, but it is not a smart decision for everyone. Many different factors must be taken into account before making the decision to file for bankruptcy and it is a decision that should not be taken lightly.

First you should consider all possibilities that could get you out of your current debt situation. One possible alternative is to come up with a repayment plan based on your current income. This approach basically allows you to make a little progress with each paycheck you receive. You will most likely be living paycheck to paycheck, but if you are in a lot of debt, you are probably already doing this. If you think this approach is possible for you, you must then consider whether you can emotionally deal with the lingering debt and harassing telephone calls you most definitely receive from your creditors until you have paid everything off. This could last for years and take a toll on your mental and physical health. If you think you can do this financially, but do not believe you can handle the mental or physical stress that comes with it, then this approach may not be a good one for you.

If the above approach is not for you, then you might want to consider filing for bankruptcy, but you must first fully understand which chapter of bankruptcy you are eligible to file and how bankruptcy will affect your debts, assets, future, and health. There are generally two types of bankruptcies an individual files. The first is a Chapter 7, which is a strict liquidation of your assets and a wiping out of your debts, and the second is a Chapter 13, which is a reorganization of your debts. Which chapter you are able to file mostly depends on your household income and family size.

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Published on: September 14, 2015

Self Created Impossibility of Compliance with Bankruptcy Court Orders is not a Valid Defense

By Kendal Schoepfer

For years people have turned to asset protection trusts and offshore accounts to protect their assets. While a trust can be a great estate-planning tool to protect your assets, off-shore accounts and trusts used to defraud your bankruptcy trustee could place a you in some very hot water. Oftentimes trustees of a trust will not distribute funds because they are able to withhold a distribution at their own discretion and a foreign bank may make the same claim.

On the outset this might seem like a great idea: the bankruptcy court cannot force the legal entity or bank to present the money and therefore the debtor doesn’t technically have to turn the assets over to the bankruptcy estate. However, a bankruptcy court will usually remedy this situation by holding the debtor in civil contempt until the repayment has been made. This means that if a trustee or bank refuses to make a distribution, the debtor could face a lot of jail time.

Another similar issue has become more frequent in bankruptcy court. In the case of In Re 1990’s Caterers LTD., a debtor admitted he had received money from a property auction that was owed to the bankruptcy estate. However, at the subsequent contempt hearing the debtor said he had spent the money so there was nothing left to turn over. The court was then presented with the issue of whether the debtor’s inability to return spent money excused the debtor from civil contempt and incarceration.

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Published on: September 8, 2015

Received a Summons after Bankruptcy. What should I do?

By Kendal Schoepfer

The most common type of summons received after filing bankruptcy and obtaining a discharge is a foreclosure summons. When received, it can be very alarming. You filed bankruptcy, surrendered a home, and received a discharge. You moved out of the home and on with your life thinking you are no longer liable for the home. However, when you elected to surrender the home in your bankruptcy petition, this only took care of your financial responsibility regarding the home. The bankruptcy did nothing about the deed for the home being in your name. Therefore, the bank still has to foreclose on the property in order to get the property out of your name and to take legal possession of the property. When a foreclosure is purely to take legal possession of the home and not for any money damages, it is called an in rem foreclosure action. You do not have to answer the summons unless you believe you were incorrectly served or they are suing for money damages as well. The mortgage holder must serve you because you are an interested party due to your name being on the deed.

If the summons you received after bankruptcy is for a credit card or another kind of debt you believe was discharged in bankruptcy, then you need to respond to the summons stating that the subject debt was part of a bankruptcy. Before doing so, make sure the debt was properly listed on your bankruptcy schedules and it is a debt that can be discharged. If it was properly listed on your schedules and you received a discharge, then assert this in your response/answer to the summons. Once you show the debt was discharged, the action should be dismissed.

If you are unsure of what type of lawsuit you have been served with or whether the debt was properly included in your bankruptcy, you should consult with an experienced bankruptcy attorney. A simple review of the summons, accompanying complaint, and your bankruptcy petition by an attorney can help you determine what action, if any, you need to take. Contact the Law Office of David M. Goldman, PLLC by calling (904) 685-1200 to speak with an attorney today.

Published on: September 4, 2015

My Car Payments are Current. Will I be Able to Keep it if I File Bankruptcy?

By Kendal Schoepfer

Most likely yes. Regardless of whether you file a Chapter 7 or a Chapter 13 Bankruptcy and this is why.

Chapter 7 Bankruptcy

When you file a Chapter 7 Bankruptcy with a leased or financed vehicle, you simply need to reaffirm the debt in order to keep it. If you are current on your monthly payments, you simply continue to make your payments and the vehicle lessor or financer will provide you with a Reaffirmation Agreement for you to sign. Once executed, it will be filed with the court. By reaffirming the debt, you are agreeing to remain liable for the full amount you still owe on the vehicle despite filing bankruptcy.

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Published on: September 1, 2015

How Can Bankruptcy Stop a Wage Garnishment?

By Kendal Schoepfer

What is Wage Garnishment and how does it work?

Wage garnishment is a court order that compels your employer to deduct a certain amount of money from each paycheck you receive and send it directly to your creditor until your creditor is paid in full. Luckily there are limits set by law on the amount of money that can be garnished from each paycheck.

Florida requires your creditor to first obtain a judgment from a court before they can request a wage garnishment. Once a judgment order has been obtained, your creditor files a Motion for Continuing Writ of Garnishment with the Court. The Court then provides a Continuing Writ of Garnishment Against Salary or Wages, which is served on your employer. Your employer then has 20 days from receiving it to file a response with the Court. Your employer’s answer must state whether or not they are in fact your employer, as well as the frequency of your pay periods and the amount of your salary and wages. The writ then directs your employer of where to send the withheld money and how much shall be withheld. The only instances where your paycheck can be garnished without a judgment from the court is when it is for debt owed for income taxes, child support, or student loans.

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Published on: August 28, 2015

Bankruptcy and Florida’s Homestead Exemption of Inherited Real Property

By Kendal Schoepfer

Have you inherited your parents homestead property? Do you own it free and clear from any mortgage or lien? Do you reside in the property? Are you considering filing a Chapter 7 Bankruptcy? If so, then I urge you to consult with an attorney at the Law Office of David M. Goldman, PLLC. Each one of the questions posed above are key factors in determining what affect a Chapter 7 Bankruptcy filing may have on your inherited real property.

In Florida there is a broad homestead exemption available to those filing bankruptcy; however, you must first meet some very strict requirements. If you acquired the real property at least 1,215 days (approximately 3 years and 4 months) prior to filing the bankruptcy and it is your homestead, then you may use an unlimited homestead exemption, but if you have not, then your homestead can only be protected up to $125,000. It is also important to note that you do not have to reside in the subject property as your homestead for the 1,215 days prior to filing bankruptcy in order to enjoy full protection. For example:

Your mother and father have lived in their current home in Florida as their primary residence for the last 15 years and even filed their homestead exemption with the state. When they pass away, they leave their homestead property to you; free and clear from any mortgage or lien. However, you do not move into the property and instead you continue to reside with your wife and children in another home, which also happens to be in the state of Florida and which you consider your homestead.

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Published on: August 26, 2015

Jointly Held Property in Bankruptcy

By Kendal Schoepfer

Many people who are considering filing bankruptcy are very concerned about their property jointly owned with a spouse, sibling, or other person. These are real concerns as a bankruptcy filing could cause a joint-owner to lose his or her interest in the property. The exact affect a bankruptcy filing may have depends on who the joint-owner is, how the property is titled, and your state’s exemptions.

The most commonly held joint-property is property held by a husband and wife. In Florida, property owned by a husband and wife is presumed to be by Tenancy by the Entirety unless specifically specified otherwise. This type of joint ownership protects the property from the bankruptcy estate if only one spouse is filing bankruptcy and there are not any unsecured joint debts. Property held by a husband and wife as joint tenants with the right of survivorship is not afforded this type of protection.

The second most commonly held property is property inherited by siblings from a passing parent or other family member. Unless the property can be protected by a bankruptcy exemption, your siblings or other family member could lose their title to the property due to a bankruptcy filing. Unfortunately, the bankruptcy court does not care how you acquired the property. It could be through a gift, inheritance, purchase, etc., but once you have acquired the property, you have acquired it, and it is part of your bankruptcy estate. This means that if it is not protected by an exemption, the trustee could ask the court to order the sale of the property in order to settle your debts. This causes your joint owners to lose their title to the property. This is true for property held as joint tenants, joint tenants with the right of survivorship, and tenants in common.

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