Chapter 13 Tests
Thinking about a Chapter 13 bankruptcy case? Before you can file a case under this chapter of the bankruptcy code, there are a number of “tests” a debtor must pass. Here’s a way to keep track of them all: Debt limits: Chapter 13 has upper debt limits, but no lower limits. The current upper limits [...]
Bankruptcy and divorce: can the bankruptcy court step in and re-do your divorce settlement?
Bankruptcy and divorce — those handmaidens of a whopping mid-life crisis — are serviced by competing court systems with competing and confusing rules and requirements. Here is a guide to (at least partially) untangling the mess. First, since 2005 there has been a notion in the bankruptcy courts of something called a “domestic support order,” [...]
Confusion reigns on whether a means test is needed when converting a bankruptcy case to Chapter 7
If you file a Chapter 7 bankruptcy case, debtors with mainly consumer debts have to also file a “means test,” which proves they qualify for Chapter 7 relief based on their recent income. If you file Chapter 13 case, there is no pure means test (although there are qualifications), but you file a very similar [...]
Is renting out your house a way to save it?
Under the present bankruptcy law, it is very difficult to use a Chapter 13 bankruptcy plan to impose your own mortgage modification on the primary lender for a residential home. There have been near constant efforts to get the Congress to change this, but so far the pleas have fallen mostly on deaf ears. The [...]
Can a bankruptcy trustee tell you where to do your banking?
Can a bankruptcy trustee force you to do business with a certain bank after a case is filed? In Massachusetts, the answer appears to be “no,” but it’s not for lack of trying. In a Chapter 13 case, if the debtor is self-employed or runs a small business, they are required to establish a new [...]
The basics of lien stripping and second mortgages
Time for a little stripping, anyone? I’m not suggesting that you show up at the Cabaret Lounge with a fistful of dollars; instead, I’m thinking you might want to know how to get rid of a second mortgage with a Chapter 13 bankruptcy case. Brett Weiss, an attorney from Maryland, explains the basics of how [...]
Chapter 13 bankruptcies might require you to do your taxes quickly
A reminder, if you are thinking about filing a Chapter 13 bankruptcy case. You might want to consider doing your 2010 taxes quickly, and not putting it off until April 15th, or heaven forbid, October. One reason is that Chapter 13 plans have to pay priority claims in full. And the priority claim that is [...]
Going to the well one more time for bankruptcy reform
Its that time of year again — time to consider when and how to reform the Bankruptcy Code. Specifically, should the bankruptcy code be amended to allow judges to force creditors to accept “cramdowns” — forced modifications — on first mortgages on a debtor’s house? This idea has been floating around for years now, and [...]
Nationwide, fewer homes underwater
Bloomberg is reporting that the number of homes in the United States that are “underwater,” that is, worth less than the amount owed on them is decreasing slightly. For the quarter ending September 30th, 22.5% of the homes with mortgages have negative equity. In the prior quarter, that figure was 23%. But what is causing [...]
Pre-nup won’t necessarily help you in Chapter 13 bankruptcy
Can having a valid pre-nuptual agreement help you out if you later decide to file Chapter 13 bankruptcy? Maybe, but don’t count on it, at least in Massachusetts. There, one debtor pointed out that her pre-nup called for each spouse to pay their own debts during the marriage, and in particular, called for the wife [...]
