Bankruptcy Category Archives — Page 5 of 7 — Securities Fraud Lawyers Blog Published by Securities Fraud Attorneys

How do I know which chapter of bankruptcy to file?

Published on: May 4, 2015 | by Savage Villoch Law, PLLC

Bankruptcy is very complicated, and you should consult with an experienced and skilled bankruptcy attorney about your debt relief options. People with primarily consumer (not business debts) can file bankruptcy under either Chapters 7, 11, or 13 of the bankruptcy code. You must elect one chapter to proceed under at the very beginning of your case when you file the petition with the court. There are a few exceptions, but once you elect a chapter, you must stick with that chapter so it is very important that you know which chapter is best for you before you file.

Chapter 7 is for people who wish to give up their non-exempt assets in exchange for a discharge of most, if not all, of their debts. You must qualify for chapter 7, however. And to qualify, you must pass the “means test.” The means test looks back at your monthly income (from whatever sources, e.g., job income, rental income, alimony, child support, etc.) for the last six months. It will also consider your spouses income, if any, and how many dependents that you have. If you make below a certain amount as determined by these factors, then you qualify for chapter 7. If you made more than that amount, then you are required to file a Chapter 13 case.

Chapter 13 is for people who make a regular wage and either they make too much money to qualify for Chapter 7 (see means test above) and/or they would like to keep non-exempt assets that they would otherwise lose to liquidation in a Chapter 7 case. In a Chapter 13, a person agrees to pay a portion of his or her disposable income to a trustee who then makes the payments to the person’s creditors. The payment plan can be 3 to 5 years, but most of the time, it’s a 5-year plan. One of the benefits to a Chapter 13 case is that the debtor gets to keep non-exempt assets. For instance, if the debtor was involved in an auto accident case and is expecting a large settlement, but financial struggles have the debtor filing bankruptcy, then the debtor can keep the future settlement so long as the debtor elects Chapter 13 and makes all of his or her payments under the plan.

If I am having problems paying my bills, what is the first thing that I should do?

Published on: April 30, 2015 | by Savage Villoch Law, PLLC

The first thing that you should do when you’re having trouble paying your bills is set up a free consultation with a bankruptcy attorney to see what debt relief options are available to you. Financial struggles are stressful and can rip families apart. You might be uncertain as to whether you can be evicted from your home or lose your car or have your wages garnished. You might not know how quickly your creditors could move on accomplishing these things. For example, could you be evicted a week from now or will it takes months?
When you’re unable to pay your bills as they become due, a bankruptcy attorney can help you prioritize what debts are the most important, like state and federal taxes, rent payments, mortgage and car payments, and utility payments. The attorney can also help you understand if your financial struggles are temporary or long term. If the situation is temporary, you could do certain things to hold off your creditors while getting back on your feet so that you can start paying them again.
If the financial struggle is a long-term problem or your home or car is in jeopardy of repossession, then bankruptcy could be the answer for you. A bankruptcy attorney could also explain how these things affect your credit score. Either way, you will feel immediately relief with a free initial consultation from an experienced bankruptcy attorney. Schedule a free consultation TODAY with Savage, Combs & Villoch, PLLC. Our telephone number is 813-200-0013. We do bankruptcies in Central Florida and we’re ready to help today! Please visit our website to learn more about bankruptcy and refer a friend or family member too.

What is bankruptcy?

Published on: April 26, 2015 | by Savage Villoch Law, PLLC

Bankruptcy is a federal law that allows people and businesses (even cities and municipalities) to manage or eliminate debt. Bankruptcy is available to most everyone, and you do not even need to be insolvent to file. Bankruptcy is important because it imposes an immediate “automatic stay” on all creditors, and these creditors must stop all collection efforts. If the creditors continue to call, send letters, file lawsuits, etc., those creditors are in violation of bankruptcy law and could be fined or required to pay sanctions. This automatic stay gives the bankruptcy filer (or debtor) a breathing spell.

There are different chapters of bankruptcy depending on your needs or factual situation. There are Chapters 7, 9, 11, 12, and 13. The most common chapters for everyday consumers are Chapters 7 and 13.

Chapter 7 provides a discharge of certain debts if the debtor agrees to give up all of his or her non-exempt property to a trustee for sale for the benefit of the debtor’s creditors. Most people will find that there are very little to no assets available for creditors after the exemptions. For example, in Florida, a person’s home can be exempt, retirement accounts can be exempt, up to $1,000 of a person’s vehicle can be exempt, property held jointly with a non-debtor spouse can be exempt, etc.

Why is divorce often cited as a reason for bankruptcy?

Published on: April 13, 2015 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, with Savage, Combs & Villoch, PLLC

Divorce is often the catalyst for bankruptcy. After divorce, finances are stretched. There are new budgetary constraints. One partner might lose health insurance or the insurance might become more costly for the ex-spouse. Alimony and child support become additional expenses to pay. Some start having to pay new expenses such as child care, and others will find their expenses increased because no longer are they splitting bills and living expenses with their former partner.

A particular trigger for bankruptcy is the former marital home and the mortgage. When a married couple owns a house, typically one spouse keeps possession and the other spouse will agree to make or help out with the mortgage payments. Unless the couple refinances the mortgage, both partners will remain legally responsible for the mortgage debt. The problem arises when, for whatever reason, the mortgage goes unpaid and falls into default. This drags the co-obligor – who doesn’t even live in the home – into a foreclosure lawsuit and starts to severely damage that person’s credit score. One spouse can file for bankruptcy, leaving the other spouse adrift and fully responsible for the mortgage.

Proposed Amended and New Local Rules for Bankruptcy Court, Middle District of Florida, for 2015

Published on: March 10, 2015 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, Esquire, with Savage, Combs & Villoch, PLLC

The judges of the United States Bankruptcy Court for the Middle District of Florida are considering new rules and proposed amendments to the Local Rules. The proposals are available HERE for public comment beginning on March 9, 2015. The public comment period ends on April 24, 2015. When promulgated by the judges, the amended and new Local Rules will become effective on July 1, 2015.
While many proposed changes are stylistic, some of the proposals will affect daily bankruptcy practice. For instance, one proposed amendment reduces the time during which Electronic Filing Users must retain paper copies bearing original signatures from four years to two years. One new rule requires subpoenas before trial to be filed with the Court in addition to being served on each party to the adversary proceeding or contested matter. Another change involves amendments to lists and schedules. The amendment requires that the Notice of Deadline to File Proof of Claim, if any, be served upon newly added creditors in amended Schedules D, E and F.

Pro Bono? Jose Baez is out the $397,431.78 owed for his representation of Casey Anthony.

Published on: February 8, 2015 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, with Savage, Combs & Villoch, PLLC

In October 2008, the State of Florida charged Casey Marie Anthony with first-degree murder in the death of her two-year-old child, Caylee Marie Anthony. The matter was highly publicized and dominated the national news for years. From May to June 2011, Casey Anthony stood jury trial and was represented by criminal trial lawyer, Jose Baez, in what Time Magazine called the “Social Media Trial of the Century.” Jose Baez shocked many legal pundits and even most public opinion when he ultimately secured a verdict of “not guilty” for Casey Anthony on her murder charges, along with charges of aggravated manslaughter and aggravated child abuse.

The verdict had a high price, however. Jose Baez billed $397.431.78 in legal fees for his representation. Not only that, but Casey Anthony became financially dogged elsewhere with lawsuits associated with her daughter’s death. For example, she was sued for defamation by a former babysitter, Zenaida Gonzalez, a person whom Casey Anthony initially blamed for the disappearance. Ms. Anthony was also sued for fraud and unjust enrichment by Texas EquuSearch, a company that spent at least $100,000 in searching for Caylee Anthony even though Casey Anthony already knew that Caylee was dead.

Can an employer terminate your employment because you filed bankruptcy?

Published on: January 17, 2015 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, Esquire, with Savage, Combs, & Villoch, PLLC

No. An employer is strictly prohibited from terminating your employment or discriminating against you in any way solely because you filed bankruptcy. Section 525 of the Bankruptcy Code is entitled “Protection against discriminatory treatment.” Subsection (b) specifically states that no private employer may terminate the employment of, or discriminate with respect to employment against, an individual who filed bankruptcy simply because he or she filed bankruptcy.

Similarly, if your employment requires a license or permit, for example, a doctor, nurse, lawyer, or financial adviser, the governmental unit that issues such license or permit cannot deny, revoke, suspend, or refuse to renew such license or permit simply because you filed bankruptcy. 11 U.S.C. § 525(a). By way of further example, a state medical licensing board cannot revoke a doctor’s license to practice medicine simple because the doctor filed bankruptcy.

A brief history of bankruptcy in the United States.

Published on: December 21, 2014 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, with Savage, Combs & Villoch, PLLC

Contrary to pop culture belief, bankruptcy existed long before the game show Wheel of Fortune. Remember when contestants would lose their prize money if they spun the wheel and randomly landed on the ominous black wedge, “BANKRUPTCY”? Bankruptcy also existed way before celebrities like M.C. Hammer, Billy Joel, Burt Reynolds, and Mike Tyson each filed for bankruptcy protection. P.T. Barnum, a famous American showman and businessman, filed bankruptcy in 1877. K-Mart filed bankruptcy in 2002.

Bankruptcy in the United States dates back to the United States Constitution itself. Article I, Section 8 of the U.S. Constitution gives Congress the power to enact uniform laws on the subject of bankruptcies. Although Congress had this power beginning in 1787, Congress did not pass a bankruptcy law until about 13 years later in 1800 and, even then, the law passed was short lived and was limited to involuntary bankruptcy proceedings brought against merchant and traders. In 1803, Congress repealed the Bankruptcy Act of 1800, citing excessive costs and corruption.

"Debts canceled by bankruptcy still mar consumer credit scores," but consumers can fight back.

Published on: November 29, 2014 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, with Savage, Combs & Villoch, PLLC

On November 12, 2014, the New York Times published an article entitled “Debts canceled by bankruptcy still mar consumer credit scores.” In the article, the author, Jessica Silver-Greenberg, explains that “Tens of thousands of Americans who went through bankruptcy are still haunted by debts long after — sometimes as long as a decade after — federal judges have extinguished the bills in court.” This article was also featured in the Tampa Bay Times on Friday, November 21, 2014.

Lawyers with the United States Trustee Program, a group charged with overseeing federal bankruptcy cases, are investigating certain banks, such as JPMorgan Chase, Bank of America, Citigroup and Synchrony Financial (f/k/a GE Capital Retail Finance), because these banks are suspected of violating bankruptcy law and ignoring the discharge injunction. Section 524 of the bankruptcy code provides a “discharge injunction” where creditors are no longer allowed to pursue debts canceled or discharged in the bankruptcy case. The banks allegedly ignore the discharge injunction when they know (or should have known) the debt was canceled but still seek to collect the debt, whether by continuing to report it on the person’s credit report, sending letters, or making telephone calls about the canceled debt. Often times, these are not clerical errors, but debt-collection tactics. In some cases, the banks purportedly refuse to correct the “mistakes,” insisting that the canceled debt be paid. An example cited in the article was The Vogts, a couple in Denver, who paid JPMorgan $2,582 on a debt that was discharged in bankruptcy because they needed a clean credit report to get a mortgage.

U.S. Supreme Court to review Eleventh Circuit ruling where Chapter 7 debtors are allowed to strip off second mortgages

Published on: November 24, 2014 | by Savage Villoch Law, PLLC

By Alfred Villoch, III, Esquire, with Savage, Combs & Villoch, PLLC

On November 17, 2014, the United States Supreme Court granted a petition for writ of certiorari in two cases: Bank of America, N.A. v. Caulkett (In re Caulkett), 566 Fed. Appx. 879, 2014 U.S. App. LEXIS 9407 (11th Cir. Fla., 2014) and Bank of Am., NA v. Toledo-Cardona (In re Toledo-Cardona), 556 Fed. Appx. 911, 2014 U.S. App. LEXIS 9035 (11th Cir. Fla., 2014). In both cases, the United States Court of Appeals for the Eleventh Circuit ruled that a Chapter 7 debtor could strip off a second mortgage when the home’s value fell below the amount owed on the first mortgage.

What that ruling means is, if you file bankruptcy and the second mortgage on your home is completely “underwater,” like many second mortgages after the recent housing bust, then you could keep your house subject to the first mortgage and strip off the second mortgage completely leaving the debt secured by that second mortgage to be discharged in the bankruptcy. In the Toledo-Cardona case, the debtor kept his home and stripped off the second mortgage that had a value of over $100,000.00. That is why Bank of America and other lenders are not pleased with the decision.