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Filing Bankruptcy When Unemployed
Filing for bankruptcy does not specifically mention the requirement of an income source. But, directly or indirectly there is a significant impact of employment on eligibility for Chapter 7 and Chapter 13. If you have lost a high salary job recently, you might end up qualifying for Chapter 7 and at the same time, if you just lost the job and are unemployed while filing bankruptcy, you won’t qualify for Chapter 13. It’s really tricky when it comes to employment and bankruptcy. To know more such interesting stuff about bankruptcy, log on to Recovery Law Group.

What are the employment factors affecting bankruptcy?

The past, present, and future all three aspects are touched while looking into the employment status while evaluating bankruptcy. Some of the key aspects relating to employment that needs to be assessed can be listed as follows-
• The duration or tenure of employment
• The pay scale difference between the previous employment and the current employment
• Possibilities of availing job in the near future if unemployed
• Other sources of income
The four factors listed above are the most important discussed aspect that can determine whether you will have to file Chapter 7 or Chapter 13. The employment and income sources become extremely important for Chapter 13 as you need some disposable consistent income in order to qualify.

How does employment impact Chapter 7?

Chapter 7 is basically the disposal of all nonexempt assets to settle the debts. Its one of the fastest ways to get over debt, release maximum unsecured debt, and have a fresh start with finances once again. It is quick too. Being unemployed actually helps you to qualify for Chapter 7. A means test is the basic eligibility test for the filer to be eligible for Chapter 7. Means test basically is the comparison of your income with the median state or federal income. If your income minus the standard expenditures are less than the average median of state or federal (depends on the state in which bankruptcy is being filed), you qualify for Chapter 7 bankruptcy.

The average gross income earned by each and every family member over a period of recent six months is considered for means test eligibility. If the income is above the state/federal median, some standard deductions are reduced to account for daily expenses based on a number of family members. If the income then falls short of the state or federal median, you qualify, or you will have to consider other alternatives. This also means if you have just become unemployed, the average income over 6 months might just pull you over the median income and result in ineligibility to file under Chapter 7. The best practice then would be to wait until the average falls below the median. Similarly, if you get a new job during the bankruptcy case is in progress, the dynamics can change based on circumstances.

How does employment impact Chapter 13?

With respect to Chapter 13, the case is completely the opposite. No income means no eligibility for Chapter 13. The stability of the job, the tenure of the employment, and the disposable income play an important factor in determining eligibility for Chapter 13. If you are unemployed and do not possess any other strong and consistent source of income, it is highly unlikely to qualify for Chapter 13. If you are unemployed but possess some additional sources of income like rent/royalty, social security benefits, nonemployment compensation, pension, etc., there is still a possibility of being eligible to file under Chapter 13. Even a sole proprietor business income could qualify as a source of income however, the eligibility ultimately shall be at the court’s discretion on the case to case basis.
There are many ways to be eligible for Chapter 7 and Chapter 13. You need the help of the right attorney. Call +1 888-297-6203 right now for the best solution for your eligibility concerns.
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July 26, 2019
FAQs Related to Chapter 7 Bankruptcy
Bankruptcy can be quite confusing. Lawyers of Los Angeles based bankruptcy law firm Recovery Law Group, confirm that there are numerous questions that people have regarding bankruptcy process and discharge. You can ask expert bankruptcy lawyers at 888-297-6023 about issues related to various bankruptcy chapters. Here are some FAQs related to Chapter 7.

What is Chapter 7 bankruptcy?

Also known as “Liquidation Bankruptcy”, Chapter 7 bankruptcy is an ideal way to get a fresh start as it wipes off most types of debts. In this case, any non-exempt property that you have is liquidated by the bankruptcy trustee and the proceeds are used to pay your creditors. In most cases of Chapter 7 bankruptcy, the filers have very little non-exempt property, hence they end up keeping nearly all of it.

Is it true that now it is harder to qualify for Chapter 7 bankruptcy?

The bankruptcy laws were revamped by the Congress in 2005 which resulted in stricter norms for potential Chapter 7 bankruptcy filers. Earlier a Chapter 7 bankruptcy case was dismissed by the bankruptcy judge if the debtor had enough disposable income for a repayment plan as per Chapter 13. Now, specific criteria are used to determine if a debtor can afford a Chapter 13 repayment plan.
For an individual to qualify for Chapter 7 bankruptcy they must be able to pass the means test. In this case, the debtor’s income is compared to the median income of the state for a household of a similar number of individuals. If debtor’s income is less than the median income, he/she qualifies for Chapter 7 bankruptcy. In case the income is above the state median, an account of the expenses and debt payments is seen to assess whether a repayment plan can be devised for Chapter 13 bankruptcy or not.

Are all unsecured debts wiped off in Chapter 7 bankruptcy?

Unsecured debts comprise of those debts which do not have any collateral attached with them, such as medical bills, credit card bills, personal loans, etc. Most unsecured debts are wiped out in Chapter7 bankruptcy. However, some unsecured debts like student loans, child and spousal support, tax debts due within previous 3 years, recent debt for any luxury items, and any debts arising due to fraud (writing a bad check, lying on credit application) are considered non-dischargeable. These debts remain even after bankruptcy.

Can I keep my home in Chapter 7 bankruptcy if I am current on my mortgage?

State and federal government provide exemptions for bankruptcy filers to protect some equity in the property. This allows them to get a fresh start. The homestead equity which allows exemption on equity on home to bankruptcy filers varies from state to state. If the homestead exemption covers all the equity in your home, you can keep your home in a Chapter 7 bankruptcy Los Angeles. However, you need to stay current on your mortgages to ensure your home remains with you.

If I don’t own a home, do I have to give up other property while filing for Chapter 7 bankruptcy?

Bankruptcy laws allow debtors to keep some amount of property, known as exempt property. This includes some equity in home, vehicle (up to a fixed value), clothing, furnishings, household appliances, personal effects, retirement funds, pensions, tools of the trade, etc. Many times, debtors end up keeping nearly all of their property when they file for bankruptcy.
*Are you more than 60 days past due on your mortgage?
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*Do you own a home?
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Are you currently working?
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By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 26, 2019
Chapter 13 Bankruptcy Cost and Effectiveness
When you are struggling with debts, you are probably considering bankruptcy via Chapter 7 or Chapter 13. Once, after assessing different eligibility criterions, you lock upon Chapter 13, the next question is to determine how effective it is and what would be an estimated cost for the same. We will try to explore an estimate of some of the costs and effectiveness of the whole process using the survey results of the readers. If you have still not determined whether to go for Chapter 13 or Chapter 7, consider logging in to Recovery Law Group for information about eligibility and other salient features of each chapter to make a wiser decision. To start with let’s identify a range of all the costs associated with Chapter 13.
1. Cost of an attorney
The attorney cost can range from $1,500 to about $5,000. The survey shows a good chunk of people paying between $0 to $3,000. To be specific, 24% of readers confirm to have paid below $1,500 and 39% readers confirm to have paid between $1,500 to $3,000. This makes for 63% in the range of $0-$3,000. 30% people paid between $3,000- $5,000. While 7% of people ended paying more than $5,000. Depending on the complexity of the case, you are likely to end up in the $0-$3,000 range or $3,000-$5,000 range. In rare circumstances, you might end up paying above $5,000 as per the survey.

The cost of attorney also depends on various factors like an attorney, win percentage history, bankruptcy filing state, etc. Most of the attorneys usually charge a flat fee that includes most services a common bankruptcy case would need. An additional $310 on an average might have to be kept aside as filing fee. There are bankruptcy court rules and regulations or guidelines that control pricing for the services offered by the attorneys too. The range for attorney cost as per a few states can be listed as follows-
- Texas attorneys might charge you between $3,000-$3,825
- California attorneys might charge you between $3,300-$5,000
- Florida attorneys estimate ranges between $3,500 to $4,500
- Michigan would be between $2,600 to $3,650
- Finally, Virginia would be $4,000 to $5,100
What potential reasons could hike your attorney cost?
- If you are a sole proprietor and filing for bankruptcy under Chapter 13
- If your house is less worth when compared to the amount you owe. You might want to seek a release of debt for the amount in excess of the worth
- If you want to release a student loan or similar kind of priority or non-releasable loans
- If there is any suit involved along with bankruptcy
Chapter 13 payment plan completion survey

Chapter 13 bankruptcy consists of a payment plan which lasts for 3-5 years depending on the amount of debt and the disposable income. The survey about how many people ended up dismissing the payment plan before the stipulated duration and how many people ended up completing the payment plan shows interesting results leaving us not much to pick between them. While 48% of people ended up completing their payment plan tenure, 52% of people were successful in dismissing the case before the tenure actually ended. By this stat, there is a small majority of people who ended up stabilizing their financial condition and cleared of all dues before their payment plan concluded. This could be an encouraging start.

Time factor

Time is another important aspect of the bankruptcy filing. The tenure or duration of payment plan is known by all, however, the time consumed to get the plan approved and the formalities of bankruptcy court can only be figured out by the people’s feedback who have gone through the whole process. While a large chunk of people about 58% confirm the whole process taking less than 3 months, you can be rest assured that under most circumstances, the process should not take more than 6 months. Adding 32% of readers contributing to 4-6 months range, it is about 90% of people who have got their payment plan and other Chapter 13 bankruptcy procedure done in less than 6 months. Under rare circumstances would you take over 1 year as the probability based on survey results is mere 4%.

Satisfaction degree

After the whole process, the ultimate thing that matters is the satisfaction level. The survey has thrown up mixed results and it is difficult to assess how successful Chapter 13 has been for our readers. While only 40% of people say they were satisfied with the Chapter 13 results, 16% maintain a neutral approach and 44% people, on the other hand, were dissatisfied. It could be that the whole process is slightly frustrating and expensive to their liking or readers think they ended up paying most of their debts, difficult to analyze possible repercussions of this survey results.

If you are looking forward to a smooth Chapter 13 bankruptcy experience with consistent and professional support, do get in touch with us at +1 888-297-6203.
*Are you more than 60 days past due on your mortgage?
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*Do you own a home?
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Are you currently working?
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By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 25, 2019
Chapter 13 Bankruptcy and Tax Refunds
When you file for bankruptcy, any property you own becomes a part of the bankruptcy estate which is overseen by the bankruptcy trustee. Many people are worried about any tax refund or personal injury claim they receive during their bankruptcy since it could be used to pay your creditors. However, lawyers of Dallas based bankruptcy law firm Recovery Law Group inform that bankruptcy laws allow you to modify your Chapter 13 plan in some cases to excuse payment of tax refunds.

You are expected to list your income, your assets, and your debts when you file for a Chapter 13 bankruptcy. This is then used to calculate your disposable income which is used to pay your unsecured nonpriority creditors. Disposable income is calculated by deducting all reasonable and essential expenses like food, shelter, transportation from your monthly income. Since priority and secured debts are to be paid every month, any money that remains is termed as disposable and used to clear your unsecured debts over the course of your repayment plan.

Any tax refund that you get in the middle of the bankruptcy can be considered as disposable income as the funds were not included in the income-expense calculations. Moreover, since you were managing your necessary expenses and planned payments with your monthly income, a tax refund is surplus income which can be used to pay your creditors. However, if you could prove that the tax return isn’t disposable and is required by you to take care of some unexpected bills, the court might allow you to keep the refund money. For more details on this consult expert bankruptcy lawyers at 888-297-6023.

Getting your tax refund excused by the court

Any tax refund you get during your Chapter 13 bankruptcy Dallas needs to be justified as essential for your use, else it will be termed as disposable income by the bankruptcy trustee and used for paying your unsecured debts. You can modify your bankruptcy plan to excuse a tax refund with a reasonable excuse. A separate plan needs to be filed for every tax refund modification you plan to take. The modified plan should include which specific tax refund you would like to be excused, the amount of the refund along with a reason specifying why you need to keep the refund money.

A tax refund is granted only if you can prove that the expense is unexpected and essential for your day-to-day activities and that you will not be able to afford it on your regular income. A respite might be available for reasons like:
- Unexpected medical expenses for yourself or your dependents;
- Car repair or a down payment for replacement vehicle;
- Any appliance repair or replacement;
- Funeral expenses.
Having proper documentation for how you spent the money after getting the refund by the court might come in handy when you need to file a plan for another refund. Alternately, you could excuse tax refunds by not committing any tax refunds in the plan. However, this might cause the bankruptcy trustee as well as creditors objecting to it unless you could give a compelling reason (large annual expense) or you limit the amount in the plan so that you don’t receive more money than specified. Consulting with a bankruptcy attorney can open more vistas for you on how to save tax refunds.
*Are you more than 60 days past due on your mortgage?
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*Do you own a home?
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Are you currently working?
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By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 25, 2019
Basic Steps for Filing Chapter 7 Bankruptcy
Filing for bankruptcy is a complex process and needs expert guidance to deal with the nuances. Call 888-297-6023 to discuss your case. Although you could file for bankruptcy without lawyer too, Dallas based bankruptcy law firm Recovery Law Group inform, it is not likely to end up with a discharge. The basic steps involved in Chapter 7 bankruptcy are:
1. Analyzing your debt
Before filing for bankruptcy, find out which debts will remain even after bankruptcy. These debts include student loan, child and spousal support and any recent tax debts. Any collateral pledged for debt is likely to be taken by a creditor if you fall behind on payments either when you file, during your bankruptcy case or after the case.
1. Finding out exemptions
Exemption laws (federal and state) allow debtors to keep some extent of the property. When you file for Chapter 7 bankruptcy, it is important to find out how much equity in the property you can keep. Household furnishings, a modest car, retirement accounts and some equity in the home are exemptions available to Chapter 7 bankruptcy filers.
1. Checking eligibility
Chapter 7 eligibility includes passing a means test. Your average gross income for the past six months must be less than the median income for a family of the same size in your state for you to qualify. In case the average income is above the median, your allowed expenses are deducted to find out if you can use Chapter 7 bankruptcy to get rid of your debts.
1. Dealing with secured debts
Secured debts like a car loan or house mortgages have collateral attached to them. If you wish to keep the property, you need to keep making payments to the creditor. However, when you file for bankruptcy you have the option to either redeem (pay the creditor the current value of the property as a lump sum amount); reaffirm (continue to make payments to the creditor as per agreement); or surrender the property. In case you remain current on your loan, an agreement can be reached with the creditor to keep your property.
1. Dealing with bankruptcy forms
Along with bankruptcy forms, you need to inform the court about your income, assets, expenses, debts and prior transactions, including any property transaction that took place 10 years prior to a bankruptcy filing in Dallas. You also need to provide a comprehensive list of your creditors, property exemptions and decide the course of action for your secured debts. You can file the papers by opting for emergency filing (file a few required forms) or filing all your forms including schedules together.
1. Attending credit counseling course
It is mandatory for people filing for bankruptcy to attend a credit counseling course and complete it prior to the filing of bankruptcy papers or shortly after that.
1. Pay filing fee or request a waiver
You need to pay fees for filing bankruptcy papers. If you can’t afford it, you could ask for installments, or a complete waiver. If you meet the criterion (household income less than 150% of federal poverty guidelines or insufficient income to pay installments) the judge can issue a waiver.
1. Submit relevant documents
You need to submit bank statements, tax returns, pay-check stubs, profit and loss statements mentioned in your bankruptcy papers to the bankruptcy trustee.
1. Attend meeting
You need to attend a creditors meeting with the trustee where you will be asked questions that you need to answer under oath.
1. File objections
In case you wish to eliminate some liens or dispute any creditor’s claim, you can address these matters before the matter closes. Courts might allow you to reopen a case if you forgot to take care of any lien.
1. Handle secured debts
You need to act on your secured debts as mentioned in your bankruptcy papers before the case closes.
1. Finish debtor education course
You need to complete the second course (debtor education course) after filing your bankruptcy papers before receiving a discharge. In case you are unable to do so, the case will be closed without a discharge.
1. Get discharge
A successful bankruptcy ends with the discharge of your qualified debts. You are no longer legally obliged to pay for those debts.
*Are you more than 60 days past due on your mortgage?
YesNo

*Do you own a home?
YesNo

Are you currently working?
YesNo

By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 25, 2019
The Bankruptcy Filing By An Undocumented Immigrant
An undocumented immigrant can file for bankruptcy if he/she has a Social Security Number. In lieu of a social security number, Individual Taxpayer Identification Number can also be used to file for bankruptcy. There can be a negative impact on the immigration status of the bankruptcy filer when filing for bankruptcy as an undocumented immigrant. For best assistance and more insight on bankruptcy, log on to Recovery Law Group now.

What do the rules indicate?

The bankruptcy code does not have a specific mention for the bankruptcy to be filed by a citizen of the United States or residents. Bankruptcy is basically a relief that is offered to any individual who is living in the United States, owns a property or business in the United States and for the citizens of the United States. The identity of the filer is the only potential concern when an undocumented immigrant files for bankruptcy. A valid SSN or ITIN in lieu of SSN is mandatory before filing for bankruptcy. An ITIN is a tax processing number that is issued to an individual who is not eligible for an SSN. Since ITINs are issued without consideration to the immigration status, it becomes a very viable option to many.

What’s the case of an illegal immigrant?

An illegal immigrant can still possess SSN. The entry in the United States as tourist, student or any other visa is eligible for an SSN. If the immigrant breaches the stay duration, he/she becomes an undocumented immigrant. Most people who have legally entered the United States should have an SSN or an ITIN. If they are not legal immigrants, they might not want to file for bankruptcy as it can result in larger consequences.

Need for an immigration specialist

Bankruptcy by itself is a very complicated chapter so is immigration. By mixing these two focal points, the mess can get messier. When the consequences can go so bitter, it is best advised to get in touch with a professional attorney or lawyer who has rich experience and knowledge about these unique cases. Reach out to +1 888-297-6203 right now for best solutions to your problems.
*Are you more than 60 days past due on your mortgage?
YesNo

*Do you own a home?
YesNo

Are you currently working?
YesNo

By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 24, 2019
Bankruptcy by Chapter 13 FAQs
Sometimes, the best way to address all queries is FAQs. By listing some potential doubts or questions and answering them in the best way possible can give enlighten people better. Chapter 13 bankruptcy one of the most popular bankruptcy code especially for people who had wished to safeguard their assets. By answering a few FAQs below, we try to enlighten you about most aspects of Chapter 13. To know more about bankruptcy, Chapters, and legal assistance, log on to Recovery Law Group.
1. How much debt has to be repaid if I file for Chapter 13 bankruptcy?
This is a very common question. The amount of debt to be paid is usually limited to the nonexempt assets in the case of Chapter 7. How much debt will be repaid under Chapter 13 can be a tricky question and not as straight forward as Chapter 7. Let’s list different type of debts and determine the approximate percentage you may have to pay off under Chapter 13-
- Fees
All types of fees, bankruptcy fees, trustee fees/commissions, attorney fees, etc., are to be paid off in full. Under most circumstances, 100% liability on these fees is applicable.
- Priority debts
These kinds of debts are determined by state and federal codes. These usually include child support payments, alimony, state / federal tax dues, wages/commissions owed to the employees (up to a threshold), contributions owed to an employment benefit fund, etc.
- Secured Debts
Secured debts are debts which are secured by collateral or an asset. Since secured debts usually have lien attached to it, it is important to pay off the debt in full in order to retain the asset.
- Unsecured Debts
Debts which have no collateral or asset attached are referred to as unsecured debts. It is a debt which is backed by the promise to pay back. This kind of debt is usually released or discharged during bankruptcy the most. In Chapter 7 bankruptcy, you are most likely to pay less than 10% of unsecured debts depending on the amount received from liquidating the surrendered or nonexempt assets. In the case of Chapter 13, the percentage might vary based on the portion of disposable income available after keeping for fees, priority and secured debts. One might end up paying no unsecured debts to about 100% of unsecured debts depending on the scenario.
1. What is the duration of the Chapter 13 payment plan?
The duration of Chapter 13 can be maximum up to 5 years. The tenure is usually determined based on the state / federal median. For income less than the median threshold, the tenure is limited to 3 years. For income above the median, the tenure can be 5 years. If you end up clearing all your debt in 4 years, that would be the duration of your program.
1. Can Chapter 13 prevent home foreclosure?
Chapter 13 is always a great option to protect secured or unsecured assets. For a home which is a secured asset and has a lien attached to it, Chapter 13 bankruptcy can definitely help. Firstly, once the bankruptcy is filed, the filer gets an automatic stay activated which prevents the mortgage lender to make any efforts to recover his/her debts. Secondly, you can create a payment plan and get some extra time to pay off all the arrear mortgage payments. Therefore, Chapter 13 bankruptcy can definitely help in preventing foreclosure of your home mortgage.
1. Can retirement benefits be eligible for creating payment’s plan under Chapter 13?
As long as there is income which results in some disposable income after getting rid of standard expenditures, it can be used as a source to fund the Chapter 13 payment plan. It is important to have some disposable income to be eligible for Chapter 13 apart from the debt thresholds.
1. IRS tax debt, how can Chapter 13 prove beneficial over Chapter 7?
There are some debts like the IRS tax debts that do not get released under Chapter 7. You lose your assets and still are liable for the tax debts and other non-releasable debts. Chapter 13 bankruptcy also does not result in the release of IRS tax debt, but, gives sufficient time and makes for paying off IRS tax debt as a priority. 100% of IRS tax debt has to be paid off in both scenarios Chapter 7 and Chapter 13. It is slightly easier when adjusted in Chapter 13 payment’s plan.
1. Whom to contact for best assistance?
Dial +1 888-297-6203 for expert assistance and solutions for all your bankruptcy-related issues.
*Are you more than 60 days past due on your mortgage?
YesNo

*Do you own a home?
YesNo

Are you currently working?
YesNo

By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 24, 2019
Can Chapter 13 Bankruptcy help prevent Car Repossession?
One of the major concern people have when they file for bankruptcy is what will happen to their car and house – will they be safe from collection actions or not? Lawyers of Dallas based bankruptcy law firm Recovery Law Group, inform that when an individual files for bankruptcy, whether Chapter 7 or Chapter 13, the court orders for an automatic stay which prevents any collection attempts including foreclosure, repossession and threatening phone calls. However, any criminal proceedings like visitation proceedings or child custody and even some eviction proceedings continue as per the state law.

Chapter 13 automatic stay and car repossession

The automatic stay is enforced when you file for bankruptcy. It can help with car repossession, depending on what the current situation is:
- Your lender has already repossessed your car
In case the lender repossessed your car just a few days before you filed for Chapter 13 bankruptcy, there are chances you might get it back. Your Chapter 13 repayment plan needs to show that you can make payments on not just past arrears but also continue making regular monthly payments towards your car loan. In case you face a similar situation, consult with expert bankruptcy lawyers at 888-297-6023.
- You have the car when you file for bankruptcy
If your car is not repossessed yet, the automatic stay can prevent it to take place in the near future (till your Chapter 13 repayment plan is approved by the bankruptcy judge). If you include any missed car loan payments in the repayment plan and stay current on your further payments, the lender cannot repossess your vehicle. However, you need to make payments from the time you file for bankruptcy till the proposed repayment plan is approved to have “adequate protection” against any repossession action. This amount is generally equal to your car payment.

Automatic stay might not protect you if you file for Chapter 13 bankruptcy shortly after a previously filed Chapter 13 bankruptcy case was dismissed by the court. In case you do so, the automatic stay lasts only for 30 days unless you file and win the motion for additional time to prevent repossession. In case you reject a personal property lease (for car, any equipment, etc.), the automatic stay will lift on the rejection date. Alternately, a creditor can ask for the lifting of automatic stay if they can prove that they will lose money in case you stop making payments on your car loan.

Other benefits of Chapter 13 bankruptcy

Inability to pay dues often causes people to accumulate huge debts, resulting in a situation where bankruptcy is the only answer. Chapter 13 can help you manage your secured debts. In case your debt is more than what the vehicle is worth, you might be able to get a car cramdown. This is a process through which you can reduce the loan balance on the property (car, boat, storage building, vacation home, etc.) to the current value if it meets certain conditions. Additionally, you could lower the interest rate so that the payments are more affordable. Any amount which remains is treated as unsecured debt and is paid after secured and priority debts. Cramdown can be availed on several secured loans except for the mortgage on your principal residence or any recently purchased item.

You cannot use cramdown on property purchased recently. Vehicle loan taken 910 days prior to bankruptcy filing will not be reduced using this method. However, you can cramdown car title loans which were not used to purchase vehicle i.e. you used the car as collateral to finance another purchase, even if it was taken within the 910-day period. Cramdown cannot help you reduce the balance and/or interest rate in case of a dismissed Chapter 13 bankruptcy Dallas. In such a case, the loan regains its original terms and the creditor has rights to repossess the property if you are unable to pay the amount due at the interest rate you agreed to.
*Are you more than 60 days past due on your mortgage?
YesNo

*Do you own a home?
YesNo

Are you currently working?
YesNo

By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 24, 2019

An Overview of Chapter 7 Bankruptcy Process

If you are looking to file for bankruptcy, Los Angeles based bankruptcy law firm Recovery Law Group, suggests Chapter 7 as one of the best ways to get rid of your debts, provided you are able to qualify for the same. A typical Chapter 7 bankruptcy process consists of six steps:

You are required to complete a mandatory credit counseling course before you file your bankruptcy papers. This can be one either online or by phone.
You need to fill your bankruptcy forms. These are available online. Along with the forms you are expected to provide a list of all your properties, your creditors, information regarding all financial transactions that took place over the past two years.
Provide your bankruptcy trustee with a copy of the latest income tax return and any other relevant documents asked by the trustee.
30 days after filing the bankruptcy papers, a creditors’ meeting is scheduled which is mandatory to attend. The meeting is conducted by the trustee in a hearing room and is attended by the bankruptcy filer, their attorney, the trustee and possibly the creditors. You are required to provide an answer (under oath) to all questions asked by the trustee pertaining to your bankruptcy case.
Within 60 days of the creditors’ meeting, you are required to attend a mandatory budget counseling (online or via phone) and inform the court (by filing a form) about the completion of the course also provides a certificate of completion from the counseling.
You are not allowed to operate a business with inventory or give away or sell any property without your bankruptcy trustee’s permission until you get a written discharge of your debts by the court. Usually, this takes place around 60 to 75 days after creditors’ meeting. Usually, during this time frame, the creditors can, but rarely object to your getting rid of debts. In case you have any non-exempt property, the trustee makes arrangement for turning it over so that it can be used to pay your unsecured creditors. However, most Chapter 7 bankruptcy filers do not have non-exempt property.

The Chapter 7 bankruptcy timeline is very short.

Prior to filing papers	Mandatory credit counseling
Filing date	File papers to start the bankruptcy process
30 days after filing papers	Creditors’ meeting
Up to 60 days after creditors’ meeting	Compulsory budget counseling
60 days after creditors’ meeting	Get written discharge of your debts from court

In case you are worried about your bankruptcy case, consult with expert bankruptcy lawyers at 888-297-6023.

By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

July 24, 2019

What is the “Best Effort” Requirement in Chapter 13 Bankruptcy?
Individuals who cannot qualify for Chapter 7 bankruptcy, have the option of filing for bankruptcy under Chapter 13, where a repayment plan is made to pay off your creditors. According to Los Angeles based bankruptcy law firm Recovery Law Group, confirmation of the repayment plan takes place after you show your “best efforts” to pay back your creditors. This is also known as the disposable income test, wherein your disposable income will be used to clear your dues.

Filing of a repayment plan in case of Chapter 13 bankruptcy is followed with its review by the bankruptcy trustee to ensure that it complies with bankruptcy laws. The repayment plan needs to be approved by the court before it is finalized. For that to take place, you need to prove that you will use your best efforts to repay your unsecured creditors using your disposable income. Any amount which remains after deduction of allowed living expenses and mandatory payments (secured and priority debts) is termed as disposable income.

Debts are classified into three types:
- Secured debts – collateral exists against such debts; e.g. car payment or mortgage.
- Priority debts – these debts need to be paid, no matter what; e.g. tax debts and domestic support obligations.
- Unsecured debts – these are generally considered non priority debts; e.g. credit card and medical bills, personal loans.
How non priority unsecured creditors are paid using disposable income in Chapter 13 repayment plan?

While filing forms for Chapter 13 bankruptcy, you are required to provide your average monthly income for a 6-month period prior to a bankruptcy filing. This is compared to the average income against the state median income for a household of the same size. The amount you end up paying your non priority unsecured creditors depends on whether your income is above the state median or below it and on how much significant property you own.
- If income is below the state median
In this case, you do not need to calculate your monthly disposable income. The payment plan is based on your budget and is usually approved by the bankruptcy court, even if you pay little or nothing to nonpriority unsecured creditors. In this case, the plan exists for 3 years only.

Example. If a single person makes $40,000 a year and the median state income for a single household in that state is $45,000, then the individual does not need to calculate the disposable income. In fact, they may not pay anything to nonpriority unsecured creditors. Such a case is known as “zero percent plan.”
- If income is above the state median
Your disposable income will be calculated by deducting these expenses from your income – living expenses (as per local and national standards), secured debts, and priority debts. The amount which remains is the minimum payment which needs to be made to unsecured creditors every month for a period of 5 years.

Example. A married couple with a combined annual income of $ 95,000 and a state median income of $60,000 for a household of two must come up with a repayment plan by calculating their disposable income. If the monthly disposable income comes to $600, they need to pay an amount of $36,000 ($600 multiplied by 60 months) to their nonpriority unsecured creditors as part of their Chapter 13 repayment plan.
- If bankruptcy filer has significant property
Prior to confirmation of the repayment plan, the judge also considers whether your creditors are getting paid as much in Chapter 13 as they would in case of Chapter 7. In the case of Chapter 7, all non-exempt assets are sold off to pay creditors (priority and then nonpriority). However, Chapter 13 allows you to keep non-exempt property, but it should not be at the loss of creditors. To give justice to the creditors, you must pay the greater of- either the total amount of priority debts plus your disposable income or the value of the non-exempt property.

Example: An individual does not make much money but has significant property. Though the disposable income is $300 only, the ancestral property has non-exempt equity worth $165,000 and there exists a tax debt of $6,000 too. In this case, the debtor must pay either $24,000 ($6,000 priority debt plus monthly disposable income of $300 times 60), or $165,000 (value of non-exempt property which comes to $2,750 per month for 60 months). Since the income is relatively low, the debtor will not be able to support this Chapter 13 repayment plan.

Bankruptcy can be quite confusing. It is important to consult with lawyers if you are thinking of filing for bankruptcy. Call 888-297-6023 to know more about your case.
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By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.
July 24, 2019