One of the most important concerns many of our clients have is how bankruptcy will impact their lease on an apartment of home. This concern arises in one of two scenarios: (1) the client-debtor has arrearages and is filing bankruptcy, at least in part, to avoid paying the past-due rent and perhaps avoid immediate eviction; […]
When Can I Buy A Home After Bankruptcy and Foreclosure?
I was speaking with a friend the other day who about a year ago short sold a home following a job loss and related struggles. She had a short-sale and wanted to know when she could buy a home after bankruptcy and foreclosure or a short sale. Her situation is very common. She short sold her home following a job loss and nearly two years of negotiations with her mortgage lender. During negotiations of the short sale the loan was transferred (which led to the first buyer walking away) and numerous lost documents by the lender. Read more
What Is a Reaffirmation Agreement?
A reaffirmation agreement is an agreement by which the debtor agrees to remain personally liable for a debt post-bankruptcy. A reaffirmation agreement essentially eliminates the benefit of filing for bankruptcy for that one specific debt. Because reaffirming a debt undermines the most basic benefit of filing for bankruptcy, we generally discourage our clients from signing a reaffirmation agreement, unless required to do so by the lender to keep the property. If you are inclined to sign one, you should seek counsel from an experienced bankruptcy lawyer before entering into a reaffirmation agreement. Read more
Ever wondered why is bankruptcy a Constitutional Principle? The United States constitution has only 4,400 words. It is the oldest and shortest written Constitution of any major government in the world. Article 1, Section 8 of the constitution grants Congress the power “To establish…uniform Laws on the subject of Bankruptcies throughout the United States.” The Preamble of the Constitution explains that the purpose of the Constitution is to “form a more perfect union, establish Justice, insure domestic Tranquility, provide for the common defence [sic], promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity…” Considering the paramount import and brevity of the Constitution, it begs the important question: Why did the framers consider bankruptcy a fundamental principle of our union? Read more
Once a chapter 13 bankruptcy case is filed, the automatic stay prevents creditors from legally foreclosing, garnishing, repossessing or collecting against the debtor or any individual joint debtors. As part of the chapter 13 filing, the debtor proposes a chapter 13 plan (“Plan”) to reorganize their finances. The Plan will contain provisions to deal with repaying secured debts, taxes and other priority debt. It will also propose a plan to bring leases or secured accounts like car loans and mortgages current, removing judgment liens, and restructuring interest rates and amounts due on secured loans. To ensure success of the Plan, the Debtor must comply with the Plan’s terms and remain current. Read more
Many of our clients are initially somewhat concerned about the meeting of creditors. The meeting of creditors need not cause substantial concern. Frequently after the meeting our clients will comment that “it wasn’t as bad as I thought”. Read more
One of the most frequently asked questions that we hear in our Utah bankruptcy practice is whether taxes can be discharged in bankruptcy. The answer to such a seemingly simple question is actually quite complicated. Some federal and state income taxes may be eligible for discharge under Chapter 7 or Chapter 13 of the bankruptcy code under certain circumstances. Read more
Keep More Property in Bankruptcy
The Utah legislature amended the Utah bankruptcy exemptions in 2013. Bankruptcy exemptions are the laws that protect property from liquidation in bankruptcy. Since Utah has opted out of the federal bankruptcy exemptions, the Utah amendments means that bankruptcy filers can now keep more property when filing in Utah. The new exemptions take effect on May 14, 2013. Read more
Frequently clients need to file for bankruptcy, but want to do so without his or her spouse being affected. That raises the questions: Can a married person file bankruptcy alone? How is the non-filing spouse impacted when their spouse files bankruptcy alone? Read more
One of the most common concerns or misconceptions that clients express in one form or another is an insecurity that if they file bankruptcy that makes them somehow unethical or dishonest. While there may be a small minority of people who intentionally abuse the bankruptcy system, it is my overwhelming experience that people filing bankruptcy are honest, hard-working and upstanding people. The fact is that every society has some system to deal with honest and hard-working people who are experiencing extreme financial hardship. Read more