Earlier this year, Section 109(e) of the Bankruptcy Code was amended to increase the debt limits for individuals to file for protection under Chapter 13 Bankruptcy to $2,750,000 in total debt, and eliminated the distinction between secured and unsecured debt. Previously, the debt limits capped eligibility for Chapter 13 Bankruptcy at approximately $1,400.000 in secured debt and $425,000.00 in unsecured debt.
As a consequence of this change, business owners who may be burdened with substantial personal guarantees on business debt can now avail themselves of bankruptcy protection in Chapter 13 and avoid many of the administrative burdens ...
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Mortgage Forbearances Will Be Ending Soon – Then What??
Mortgage forbearance won't last forever. Here's what to do if it's coming to a close.
Mortgage forbearance has been a lifeline for many borrowers during the coronavirus pandemic. Under normal circumstances, forbearance lets you pause your monthly mortgage payments for a period of time that's determined by your mortgage lender. But under the CARES Act, all borrowers are entitled to up to 15 months of forbearance.
If you put your mortgage into forbearance early on in the pandemic, then you may be required to start making payments on your loan again in the coming months. In addition, and more importantly, there is no guarantee that your ...
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Student Loan Relief Belongs in Bankruptcy Court
Let's stop the nonsense about absolute student loan forgiveness.
I think we can all agree that if a student who never got a degree after incurring student loan debt, and is in a low paying job, that student should be afforded some relief as long as they can prove that they do not have the ability to pay the debt. As noted in last week's WSJ, this would level the playing field between the haves and have nots. The place to do this is in Bankruptcy Court. The mechanisms are already in place and have worked fairly well for the LAST 15 YEARS. Between exemptions that are allowed with respect to property that can be protected and the means test ...
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Chapter 13 Bankruptcy 101 – The Basics
If you have current monthly income that prevents you from qualifying under the Means Test for Chapter 7 bankruptcy, or if you are in foreclosure, or if you have tried to modify your mortgage and have been denied by your lender, or even if you have fallen behind after modifying your mortgage, I can help you file a petition for protection under Chapter 13 of the U.S. Bankruptcy Code.
In fact, Chapter 13 bankruptcy was initially designed for homeowners who were in foreclosure to allow them to repay their mortgage arrears as well as all, or a portion of, their unsecured debts under the protection of the United States Bankruptcy Law.
While ...
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Are You Eligible to File Chapter 13 Bankruptcy?
Contrary to Chapter 7 bankruptcy, this chapter does not allow you to discharge certain debts in return for the liquidation of a non-exempt property. Under Chapter 13 you get to keep your property and repay your creditors according to a court-approved repayment plan in 3 to 5 years’ time.
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To be able to file Chapter 13, you need to fulfill the standing requirements under this chapter. These include:
You can’t be a Business
Businesses are not entitled to file for bankruptcy under Chapter 13. Not even if they are sole proprietorships. Business bankruptcies are dealt with the principals laid down in Chapter 11 ...
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When to File for Chapter 13 Bankruptcy
Chapter 7 bankruptcy may be quick and seem far less of a hassle than Chapter 13, but there are certain scenarios where Chapter 13 may be better than filing for Chapter 7 bankruptcy. Sometimes, you have no other option other than filing for Chapter 13.
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So how do you decide whether your should file for Chapter 13 bankruptcy? Let’s find out.
Most people would consider Chapter 13 an option when they’re ineligible for Chapter 7 Bankruptcy. This happens when:
Your average monthly income in the six months period prior to the filing date exceeds the median income level in your state for your household ...
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What are the Pros and Cons of Declaring Bankruptcy Under Chapter 13?
Chapter 13 bankruptcy is also known as wage-earner's bankruptcy or reorganization bankruptcy. It is different from Chapter 7 bankruptcy in that it prevents the surrendering of assets to discharge the debt. Individuals that file for Chapter 13 bankruptcy do not have to sell any of their properties to get out of the debt burden. As a result, most people prefer declaring bankruptcy under this plan.
That being said, Chapter 13 is not for everyone. There are certain disadvantages with this plan that make it unsuitable for individuals. Here, we will discuss both the pros and cons of Chapter 13 bankruptcy that will help you in making an informed ...
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Mortgage Crises Far From Over – Time to Re-Address First Mortgage Modifications in Bankruptcy
Today’s New York Times Op-Ed Lead reminds us that the mortgage crises is far from over, but it still neglects to address what has always been the fairest and most viable option - permitting Federal Bankruptcy Judges to restructure first mortgages, including rate and principal reductions, in Chapter 13 bankruptcy proceedings.
Early in the financial crises, a few members of Congress were brave enough to draft bills to modify the bankruptcy laws to permit modifications. Their efforts were shot down by the bank lobby and quickly died - never to be brought back to life in any viable form. Now is the time to put this option back on the table on a ...
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New Means Test Housing Allowances Levels Playing Field for Long Island Renters
Most individuals or couples filing for protection under either Chapter 7 Bankruptcy or Chapter 13 Bankruptcy are required to meet certain income eligibility requirements under the “Means Test.”
Under the Means Test, you must first determine if your average monthly income for the last six months is below the median income for your state, based upon the size of your household.
If your average monthly income for the past six months is below the median income in New York, you have passed the first hurdle, and so long as you meet the other eligibility requirements, you can file for protection under Chapter 7 Bankruptcy.
If your average monthly ...
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Eliminating Taxes: What Taxes are Dischargeable in Bankruptcy?
It is commonly misunderstood that bankruptcy cannot eliminate any tax liability. Although treatment of tax liability is one of the most complex aspects of consumer bankruptcy law, the Bankruptcy Code does offer many debtors substantial income tax relief. Whether or not your bankruptcy filing relieves your tax debt depends on several factors including the nature and the status of tax liability and the type of bankruptcy proceeding. Remember, only individuals can discharge certain tax debts, not businesses.
An individual can discharge debts for taxes in Chapter 7 bankruptcy only if all of the following conditions are true:
They are only ...
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