Jan 24
Bankruptcy GuideUncategorized
I think the key to a stay violation is notice. If you had no
knowledge of the bankruptcy, there can be no willful violation of the stay.
A violation might become willful if you fail to dismiss the case after
learning of the bankruptcy, but you did dismiss the case. Here is a quote
from a Ninth Circuit case:
In Dyer, we ultimately upheld the contempt sanctions on the ground that,
though the creditor may not have known about the automatic stay initially,
he became aware of it when he was notified by the trustee, and this created
“an affirmative duty to remedy [the] automatic stay violation” by “undo[ing]
the recordation process.” Dyer, 322 F.3d at 1192. Because the failure to
cure the violation after notice was undisputed in Dyer, we agreed that the
violation was willful and upheld the contempt sanctions.
The district court relied on this aspect of Dyer in upholding the
bankruptcy court:
Defendants were charged with knowledge of the stay no later than August 21,
2002, when ZiLOG served a complaint on Defendants seeking injunctive relief
to stop the Idaho state actions. See In re Dyer, 322 F.3d at 1191.
Defendants’ failure to take affirmative action to undo an arguably innocent
violation of the automatic stay constituted a willful violation. Absent any
affirmative act by Defendants to stay or dismiss the Idaho litigation, the
bankruptcy court’s finding that the continuing Idaho state proceedings were
a willful violation of the discharge order was reasonable. . . .
*In re Zilog, Inc.,* 450 F.3d 996, 1008-09 (9th Cir. 2006).
Jan 22
Bankruptcy GuideUncategorized bankruptcy, Chapter, Understanding
Chapter 13 Bankruptcy filing is for individuals in the United States to undergo a financial reorganization, which is supervised by a Federal Bankruptcy Court. The individual who is badly in debt can file for Bankruptcy either under Chapter 7 or Chapter 13 or Chapter 11. The debtor chooses under which Chapter he or she is going to file for bankruptcy. The debtor’s financial characteristics and the type of relief sought play a great role in the choice of chapters.
The US Code sets forth debt limits for individuals to be eligible to file under Chapter 13 –
Unsecured debts of less than $336,900 and secured debts of less than $1,010,650 subject to annual cost of living increase (secured debt gives a creditor the right to take a specific item of property like home or car. Unsecured debt is a credit card or a medical bill).
Under Chapter 13, the debtor plans to pay his creditors over a period of three to five year. During this period, his creditors cannot attempt to collect the individual’s previously incurred debt except through the bankruptcy court. The individual keeps his property and its creditors get less money than they are owed.
The most important criterion for an individual to be able to file for chapter 13 bankruptcy is that the person must have a regular income. The bankruptcy-filing petition must be accompanied by the proposed payment plan to provide the payment of all priority claims. Priority claims are those claims that are given a special status under bankruptcy law such as taxes and the cost of bankruptcy proceedings. If the person is unable to complete the priority plan due to serious illness or loss of job, it can ‘justly be held accountable’. If the debtor fails to keep up payments as per the plan, the bankruptcy court may terminate chapter 13 to dismiss the proceedings entirely resulting in collection efforts resuming as before.
A chapter 13 plan is a document filed with or shortly after a debtor’s chapter 13-bankruptcy petition. The plan gives a detailed report of the treatment of debts, liens and secured status of assets and liabilities owned or owed by the debtor in connection with his bankruptcy petition. It has to meet certain requirements like unsecured creditors will receive as much through the chapter 13 plan as they would in chapter 7 liquidation, repay all creditors in full or commit all of the debtor’s disposable income to the chapter 13 plan for at least three years. Working of Chapter 13 bankruptcy: to keep all of their property, the court approves a new interest free plan for repayment. A written plan is formed to give details of all the transactions that might occur and also the duration. Repayment must begin within 30 to 45 days after the starting of the case. The creditors must strictly adhere to the repayment plan approved by the court and are banned to collect any claims from the debtors. The debtor’s Attorney will prepare the repayment plan. Advantages of Chapter 13: The advantages of chapter 13 over chapter 7 are: the individual can stop foreclosure and have a mortgage upon bankruptcy plan completion, achieve a super discharge of debt kinds not dischargeable under chapter 7 and value collateral to diverge the security interest of creditors where creditors either charge too much interest or are over secured or both and to prevent collection activities against non filing co-signers. Another advantage of Chapter 13 is that repayment can be created even if creditors disagree with it as long as the court approves it. Disadvantages of Chapter 13: The main drawback of filing personal bankruptcy is that a record of this stays on the individual’s credit report for ten years. During this period, the debtor is not allowed to obtain additional credit, without the bankruptcy court’s permission.
Since chapter 13 bankruptcies require to use the person’s income to repay some of the debts it is necessary to prove to the court that he or she can afford to meet the payment obligation – if the income is irregular or too low, the court might not allow to file the chapter 13. Before filing for bankruptcy it is necessary to receive credit counseling from an agency approved by the United States Trustees’ Office.
Jan 18
Bankruptcy GuideUncategorized
Chapter 13 bankruptcy requires that there be a showing of a post-confirmation “substantial and unanticipated change in circumstances” to upset the res judicata Confirmation Order. This would preclude a Trustee from seeking a modification based on the surrender or successful strip-off o a house, since these are preconfirmation issues/changes. This could leave the Trustee hunting for some other change in circumstances, but he’s still got to find one and show that it is substantial and unanticipated. Other Circuits, however, have a much lower standard for modification under 1329. That said, modification under 1329 is still just for post-confirmation changes, so even these lower standards shouldn’t pull the strip-off or surrender of property in. So in other words, the res judicata effect of the plan order, coupled with the requirement under 1329 that a creditor file a motion to modify, will preclude any creditor from claiming money is owed at the end of the term of the plan. If a creditor were to wait for the very end of the plan, even showing a change that occurred the day after confirmation, you could likely raise the defense of laches, namely that they delayed too long.
Jan 17
Bankruptcy GuideUncategorized closure, Defense, Legal
Foreclosure The following is a legal defense to beat the bank:
1. Truth in Lending Act (Thira) is possible revocation violated. If your loan, the banks need to refinance is set to deliver a statement at closing. This information, rescission of loan Tila under the law is incorrect. For example, the action of foreclosure is the treasurer must be exactly 35 may cancel the loan in dollars or more. This loan is that payments will be canceled and refunded the money for all borrowers.
Two. Truth in Lending Act (Thira) can damage the violation. Cases, appropriate disclosure to refinance or purchase a property with a mortgage and used the revenue that has not been afforded the right to cancel the close of the market to compensate for the money.
Three. Home Ownership and Equity Protection Act (HOEPA). This is a very powerful federal law is the control of the high cost refinance loans. If your loan of $ 150,000 under the initial rate is 8% or more, or is a violation of this act was to evaluate the loan. This violation is to allow the withdrawal and compensation substantially exceed the amount of the loan.
Four. The right to cancel for failure to advance notice. In particular, there is the need for notice to customers to close the refinancing. This form is inaccurate or incorrect, the loan after the closing date that is three years of revocation.
Five. Breach of contract. Lenders, things before starting the foreclosure process unfair or unreasonable, do a lot of access. A similar obligation to pay the mortgage, the lender does not interfere with the responsibility, as the capacity – in effect a compulsory payment of premium, needs to be more expensive We put it.
Six. Real Estate Settlement Procedures Act Many of the disclosure of this type of federal laws, rules must be provided at the close of financial institutions, which, besides prohibiting things like kickbacks and taxes not collected. If the error is triggered damage Tila, and sometimes you can cancel.
7. Fair Debt Collection Practices Act Financial institutions are in default or servicer of federal law, you must obtain a mortgage after a specific protocol in accordance with the attempts to collect the debt. Failure to follow this law enables statutory damages and attorneys fees.
8. Fair Credit Reporting Act This is a feature of the state of lenders federal law to report information on the loan, you need to report accurate negative information. Any damages and attorneys fees in violation of this Act. Punitive damages may be used under this Act.
Nine. Interest in the real estate. And ‘much to the close of the market in order to eliminate the possibility of blocking the procedures of the provider of protection should be effective. E ‘essentially third party property actually foreclose the question whether the issues guides, guides and holder of the note.
Ten. Absurdity. This will create the event of defense is centered around the opening and closing a mortgage. This violation is whether the judge’s decision to give a big enough need to urinate or change loan.
11. The state can claim for the denial of relief. This general defense attacks, while eliminating the ability of lenders can be used in combination with other defense of the seizure.
12. Failure to establish a condition precedent. Foreclosure action in court now? I want to cast with this defense, attack, and the lender owned foreclosure process.
13. FHA failure to comply with the requirements of the pre-foreclosure. All FHA borrowers are required to mail a brochure entitled “How to avoid closure” in the face, and (in most cases) before foreclosing the borrower and to set up a meeting face to face. Cases, the creditor can not delete, you can not perform these steps.
Jan 09
Bankruptcy GuideUncategorized
Client is about to file a bk7. He gets a nominal royalty from marathon oil company of about $120 bucks per quarter. No biggie. It won’t affect his decision to file, but he has not idea if the interest is assignable or if it ever expires. I’m thinking most royalties are probably assignable and somewhere out there, someone would probably pay a few bucks to get the $120 per quarter and thus, we may risk forfeiture upon filing. Bankruptcy Code prohibits fee splitting. Calif Law says can. Conditions (off the top of my head): client consent, reasonable, etc. So it it’s a state court case, then it’s possible. But if it’s a bankruptcy case, no can do.
Jan 07
Bankruptcy GuideUncategorized answer, bankruptcy, Chapter, Declare, first, question
Chapter 13, the person is under the bankruptcy law section allows you to repay his debt in whole or in part, under the protection of bankruptcy court. Chapter 13 repayment of their debts, and now is designed for people with a regular income need not be able to do so.
In contrast to Chapter 7 and Chapter, the debt is completely discharged, 13 are in debt with creditors in the chapter of debt restructuring. In this reorganization, the payment schedule established under which employees pay the 4:57 period of loan repayment was timely.
Chapter 13, because in the past often used by individuals to capture and preserve the assets of a mortgage or car loan payments. 13 and want to repay his unsecured debt in whole or in part, of ordinary people chapter, which will be selected to do this, at least in some income. If this type of bankruptcy options, but a valuable nonexempt property, houses and cars, the first seven to be used may be lost if the chapter.
The 13 is a good option for some borrowers are facing foreclosure or seizure of property to pay for the chapter in late to hold these objects are currently afford to make regular payments I hope we can. This is a lot of revenue and debtor / early or too many properties that were not subject to discharge under chapter seven. Thus, the applicant has, over the past eight years to receive a discharge for Chapter 7 are eligible for Chapter 7 protection are simply not file for Chapter 13 bankruptcy of these people.
Three to five people over the debtor to repay the debt of some or all normal sources of income when one is freed from years of harassment by creditors. The Chapter 13 debtors, which are free if you keep your property, all the money earned after the filing of the case of bankruptcy, to make periodic payments of that debt.
Bankruptcy law CHAPTER13 the United States, may be part of debt restructuring under the protection of individuals in federal court. If you use Chapter 13 bankruptcy, including Chapter 7 is liquidation under Chapter car or house, will be able to maintain these activities. And failure to repay debts is a process in which the Federal Court under the protection of a federal court of bankruptcy.
Lenders are not sufficient to confirm the payment, in whole or in part according to the Lord, can receive the application. Creditor is usually the debtor’s income is from the debtor’s assets are paid. The creditors in a case under Chapter 13 if the debtor in a case under Chapter 13 and was granted a discharge in the chapter, the notes are after the debt was discharged from the case is closed, you may not be banned from trying to collect. Creditors must refrain from any collection activities during the plan period.
As with Chapter 7 bankruptcy, Chapter 13, some debts are discharged and no head. Debt under Chapter 13, the mortgage debt of more specific term of government (for example), food and child support, certain taxes, interest and ? ? funds and student loan debt for a loan from the cause of death or personal injury liability under the influence of alcohol or drugs, without warranties, including emissions caused by driving a fine or criminal liability for damages, are included in the declaration of the debtor based on the conviction of a crime. The debt is the result of fraud and breach of fiduciary duty of the debtor, the former has proved to be no longer be discharged in Chapter 13.
First and 13 from someone is the ideal solution for people who are behind on mortgage and car payments and needs chapter / helps keep losing the house or a vehicle. Chapter 13 is a repayment plan to help you reorganize your bill based on your income. Chapter 13, because it requires the submission of income debt Chapter 13 bankruptcy is often a plan to “employees” to work, the usually invoked to help the court approved the 13 Volume repayment of debt on the day I did. If the repayment plan is called the wage earner plan or reorganization plan, the first Chapter 13 bankruptcy if the form is displayed on the credit report and pay all creditors in full.
Jan 06
Bankruptcy GuideUncategorized
He has about $500 in receivables. Essentially he rents an office to tutor kids on taking the SAT’s. There is no inventory, assets etc. Throughout the year he will gross about $180K but after expenses, he takes home $60K. I was worried that the trustee would come in and essentially take over or at least become his “partner” during the bankruptcy. I don’t want anything to happen to his LLC in this bankruptcy. Honestly, there is no liquidation value based on what he does. Without hard assets, it is unlikely the business has a liquidation value. However, be careful of receivables, bank accounts, licenses, pattens, copyrights, trademarks, contracts, etc. You’ll need to be comfortable that the business itself is not marketable. Would anyone buy this business from your client? For most modest 1 person operations without equipment, the answer is normally no and you don’t have much to worry about. If you have any doubts, contact a business realtor or appraiser. If your Trustee is on the ball, s/he will want $3000 simply as a nuisance value. A competitor of your client would almost certainly be willing to pay $3000 to your Trustee to purchase the LLC, and then shut it down, or, take over the client list. Just because there are no assets or no receivables does not mean there is no value to the business, from the Trustee’s perspective. I know that my trustee would not pursue such an asset unless there is a higher payday (or if it is that small, it better be a very easy payday). That’s why you need to talk to your client/realtor/broker about the marketability of the business – is there something that can be sold. Obviously it helps to know your bankruptcy trustees. Obviously any debts of the LLC and the ability for the debtor to open a competing business the next day is going to reduce what anyone is going to pay for a list of clients.
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