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Chapter 13

How to File for Bankruptcy in an Emergency

Bankruptcy is most often the last resort for people who have nowhere to turn to and no protection against the creditors that are coming after whatever they have left. In a lot of cases, it’s a burning bridge kind of strategy. But even in the worst-case scenario, it offers you a chance to start anew. And more importantly, it pulls you out from the strain caused by constantly harassing creditors.

Filing for bankruptcy is a thorough and lengthy process. It requires a lot of documentation, jumping through several legal hoops and waiting for at least a few months to completely get it over with. But in a lot of cases, you don’t have a few months. You might be severely in debt, with creditors about to take last-resort collection actions against you. In these scenarios, it can be in your favor to know how to file for bankruptcy in an emergency.

Emergency Bankruptcy Filing

When you are short on time, or you need to stop creditors from taking action against you, you can file an online emergency bankruptcy. It’s also called a skeleton filing. The name is apt because, in an emergency bankruptcy filing, you submit the bare bones of the documents and issues. This filing only requires you to send in a few of the basic documents to start the process.

After that, you get a 14-day window to submit the rest of the forms. If you fail to do so, your bankruptcy case can be thrown out.

Important Documents and Steps of the Process

For an emergency bankruptcy filing, you need to send the following documents:

  • Your Bankruptcy petition – It should contain all the necessary identifying documentation, chapter details, and other important information.
  • List of creditors – It’s called a creditor mailing list, and it should be a complete overview of what you will be filing in the later forms.
  • Disclosure for attorney fees.
  • Form B121 – It’s your statement about your social security number.
  • Electronic filing declaration

In most cases, these documents constitute your emergency bankruptcy filing. But it would be better if you check in with your court’s clerk or visit their website on the exact procedure and documents you need to submit for an emergency bankruptcy filing. You will need to file the original forms and a set number of copies with the court clerk. Ideally, you can submit the whole fee, but if you can’t, you can submit a fee waiver application or a request for submitting the fee in installments.

Final Words

It might be too tenuous a task to perform on your own, especially if you are already under a financial strain. At the law office of Sean T. Flynn, we can help you understand and complete the emergency bankruptcy filing procedure. If you have any queries, consultancy requests, or if you require our assistance in filing for bankruptcy, don’t hesitate to give us a call. We will do our best to help you through this tough stage and get a clean start.

Can You Get a Car Loan After Bankruptcy?

Getting a Car Loan after Chapter 13 Bankruptcy or Chapter 7 Bankruptcy

Consumers can file for Chapter 13 and Chapter 7 bankruptcy. With a Chapter 13 bankruptcy, you get to keep your possessions and pay the debt through a three to five-year repayment plan. This plan is approved by the court and involves paying a fixed amount on a biweekly or monthly basis. Chapter 13 bankruptcy can stay on your credit report for a maximum of seven years. If you file for Chapter 7 bankruptcy, certain debts might be discharged while the remaining may be paid by liquidating your property and some of your possessions.

While a bankruptcy hurts your credit score, you can still get approved for a car loan. Here’s how you can get a loan for buying a car after bankruptcy.

·         Check Your Credit

Before you apply for a car loan, review your financial health by checking your credit report. Request a free copy of your credit report from Equifax, TransUnion, or Experian. While there isn’t any minimum credit score required for getting a car loan, you will have some difficulty getting approved by a certain lender if you have a low credit score.

·         Improve Your Credit

Once you have reviewed your credit report, take some time to rebuild your credit if it is low. This might help you get approved for an auto loan at a lower rate. To improve your credit after bankruptcy, get a secured credit card and pay all your bills on time.

·         Save Money for a Down Payment

A down payment can improve your chances of getting approved for an auto loan and may even lower your interest rate. There isn’t any specific amount that you should put towards the down payment for a car. However, if you want to secure low interest rates, try to put 20 percent down on the new car.

·         Search for the Best Offer

When you have rebuilt your credit, saved money for down payment, and are ready to buy a car, search for the best offer by contacting different lenders. Compare loan terms and rates from various lenders to find the ideal deal for your situation.

Final Thoughts

Getting a car loan after bankruptcy isn’t impossible. If you can improve your credit score and save enough money for a down payment, you should be able to secure an auto loan and get behind the wheel of a new car.

Can a Bankruptcy Case Be Reopened?

Who Can Request a Reopening of a Bankruptcy Case?

Any party in interest of reopening the case can file a motion with the court to have it reopened. This category includes you, the bankruptcy trustee and your creditors. Depending on the individual, the legitimate basis for reopening a bankruptcy case can vary. The court has broad discretion on whether or not to abide by the request and reopen the case. Some of the common reason why a close case may be reopened is discussed in the section below.

Common Reasons for Reopening a Bankruptcy Case

Trustee or Interested Party

Even after you have been given a discharge, the bankruptcy trustee or any interested party that was involved in the case may want to get it reopened if they:

  • were harmed as a result of not getting a notice of your bankruptcy
  • found assets belonging to you that you didn’t disclose during the bankruptcy posses
  • discovered any significant mistake in your bankruptcy paperwork

Bankruptee

 The most common reason why a bankruptee may want a case reopened is to fix a mistake on their petition. This can include:

  • forgetting to list all their assets or debt
  • making significant errors in the bankruptcy paperwork
  • failing to file the mandatory debtor education certificate

Other common reasons could include:

  • to avoid a judgment lien
  • for addressing a violation of their discharge

How to Reopen a Bankruptcy Case

To have a closed bankruptcy case reopened, first you need to file a motion with the court and state the reasons why you want it reopened. In many U.S jurisdictions, you can file it without giving notice to other parties – also called an ex parte motion.

In addition, you may be required to submit a proposed order, which the judge will sign if they agree to move forward with your request. Depending on your stated reason, you may also be requested to file additional legal paperwork.

Get Legal Help

Can a Bankruptcy Case Be Reopened? The answer is definitely yes but it can be a complicated and difficult process. However, with the help of a qualified legal professional, you can better navigate through the whole ordeal and reach outcomes that are more in your favor.

If you are in need of personalized legal service to help you reopen a bankruptcy case, contact The Law Offices Sean T. Flynn at 512.640.3340 or contact directly online.

Bankruptcy Insider – Why is This Status Important?

Why is the Bankruptcy Insider Status Important?

In arriving at their judgment, a bankruptcy court would take into account any instances of preferences (e.g. favoritism towards any specific creditor in debt repayment) or fraudulent transfers. The status of an insider implies that information from the said person or entity is needed in the bankruptcy case to:

a) affirm what the debtor had stated regarding their transaction to be true.

b) affirm that any recent asset transfers were at their fair market value and not fraudulent.

c) Any inappropriately made transaction made by the debtor for the benefit of the insider. In which case, the lookback period is extended to one year from the standard 90 days.

d) recover the amount within the transaction with the insider and distribute them to all creditors, in the case of favoritism.

c) find evidence of any assets not disclosed in the bankruptcy case.

Who Qualifies as a Bankruptcy Insider?

Although the concept of insider is defined in 11 U.S.C. § 101(a)(31), there is no concrete rule of who or what entity can qualify as a bankruptcy insider. This is determined by the bankruptcy court on a case by case basis. However, there are some categories that tend to be common in the majority of bankruptcy cases. Below is their listing.

1) if the Debtor is an Individual

  • Debtor’s relatives
  • Any general partner
  • Any partnership in which the debtor is a general partner
  • any corporation in which the debtor is a director, officer, or person in control

2) If the Debtor is a Business Entity

  • Directors, officers or persons in control of the entity
  • Any general partner
  • Partnerships in which the debtor is a general partner
  • Relatives of a general partner, director, officer, or person in control of the debtor

3) If the Debtor is a Partnership

  • General partners
  • Relatives of a general partner in
  • General partner of, or person in control of the debtor
  • Persons in control of the debtor


In addition, common to all three include an affiliate of a debtor and managing agents.

Seek the Help of a Legal Attorney

Bankruptcy laws can be complicated and not always easy to understand. In filling a bankruptcy case, one can ill-afford room for making errors. This is why is always recommended to seek the aid of a legal attorney who can give better advise you on how to go through with your bankruptcy case. For a free consultation with an experienced lawyer, book an appointment with us online or call 512-640-3340.

What Is Consumer Bankruptcy?

Life in the United States is tough for the general public. Not everyone has a six-figure salary and can afford to keep paying bills on time. Many people are troubled by debt resulting from credit cards, home loans, student loans, car loans, etc. Debt keeps mounting, and there comes a time when a person has no option but to give up. This is when filing for bankruptcy makes sense. Large debts incurred for business or personal reasons may necessitate filing for bankruptcy. On the other hand, consumer bankruptcy entails filing for bankruptcy due to personal reasons. A consumer is allowed to file under Chapter 7 bankruptcy or Chapter 13 bankruptcy.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is the most popular kind of consumer bankruptcy, and it applies to both business entities and individuals. To be eligible for chapter 7 bankruptcy, your disposable income needs to be low enough to bolster your case. Whether the income is low or not is determined via a means test. This test takes into account your expenses and income, and you won’t be eligible if the numbers don’t meet certain requirements. Under Chapter 7 Bankruptcy, your medical bills, credit card bills, and most of the other general unsecured debts will be wiped out, and you won’t be allowed to pay back money via a repayment plan. Some major features of Chapter 7 bankruptcy include:

  • Debtors discharge qualifying debts, giving a fresh start to the consumer
  • A trustee is appointed to administer the consumer’s case and review their bankruptcy papers as well as supporting documents
  • A trustee is allowed to sell the consumer’s non-exempt property and use the money to return money to creditors
  • An automatic stay prevents creditors from collecting debt from the consumer

Chapter 13 Bankruptcy

Chapter 7 bankruptcy involves liquidation, while Chapter 13 bankruptcy is about the reorganization. This type of bankruptcy is for consumers who have a decent income with enough money left over every month to pay back some of their debts with the help of a repayment plan. Some of the major features of Chapter 13 bankruptcy include:

  • Applies to more affluent consumers/debtors
  • Individuals who need some debt relief to stop litigation or lower their card payments may apply for Chapter 13 bankruptcy
  • Individuals are allowed to keep their property, including non-exempt assets. However, they have to pay an amount equal to the total value of the non-exempt property to the creditors
  • Individuals who fall behind on loan payment and want to catch up on the missed payments to keep their assets may apply for this type of bankruptcy

Final Thoughts

Applying for bankruptcy isn’t easy, and a lot goes into the process. Ideally, you should determine what kind of bankruptcy is most suitable for you and then apply for it. If you can’t figure out which bankruptcy applies to you, consult with a bankruptcy attorney.

What Happens If You Damage Your Vehicle While You Are in Chapter 13 Bankruptcy?

Accidents can happen anywhere and anytime. If you are involved in an automobile accident while in a Chapter 13 bankruptcy, you might wonder what would happen and how the court handles the incident. Below we have explained what happens if you damage your vehicle while you are in a Chapter 13 bankruptcy.

Vehicle Damage During Chapter 13 Bankruptcy

If you wreck your vehicle during Chapter 13 bankruptcy, you should have your insurance company pay the lienholder the balance that is due on the claim. This can be less than what is being shown to be due. Then you would receive the difference. For example, if you wreck your vehicle and your insurance firm or the insurance company of the other driver agrees to pay $12,000 to you. However, the lien must be paid off. If the car is being paid through the Chapter 13 payment plan and according to the records of the Trustee and there is only $7,000 left on the claim, then the lien holder will only be entitled to $7,000, and you will get the difference, i.e., $5,000.

Another alternative is that you get a Motion to Substitute Collateral filed by your attorney. This isn’t easy, but an attorney can do it. In this case, the Bankruptcy Court would order that all or part of the insurance cash be used for buying another vehicle. Then the lien holder will be put on that car in the same amount that they were on the previous vehicle. Then you will continue to pay that amount through your payment plan. This option is useful when you need another vehicle but can’t afford to finance it. The court would put the lien on your new vehicle.

There are many court cases where this has been allowed, and debtors aren’t usually denied this right. If you are going with option one, then have your attorney look at the case and make sure that you get the insurance money from your insurance firm or the insurance company of the other driver. Don’t delay things and act fast to ensure that you get compensated for your loss.

Final Thoughts

If you wreck your vehicle during Chapter 13 bankruptcy, you don’t necessarily have to worry too much because insurance would pay for it. However, if your vehicle has been totaled, make sure to go with the second option – filing a motion. This way, you would get a new vehicle, and the lienholder would be placed on that.

The Advantages and Disadvantages of Filing for Bankruptcy

When faced with a mountain of debt, failing to make payments on time, you might think about filing for bankruptcy. Filing for bankruptcy can affect your finances for many years to come. However, for many people, it is a good idea because filing provides some benefits. Before you decide to file for bankruptcy, take a look at some of the pros and cons of filing. This would help you determine whether it makes sense to file or not.

Advantages of Filing for Bankruptcy

·         An Automatic Stay

Once you file for bankruptcy, the court will issue an automatic stay that would prevent creditors from pursuing any debt collection activity. This doesn’t cancel your debt, but it suspends all debt collection proceedings from creditors until the stay lifts or the case completes. You won’t get any letters or calls from collectors and won’t have to worry about wage garnishments, property repossessions, home mortgage foreclosures, and lawsuits on your debts.

·         Help You Keep Your Car or House

If you have fallen behind on your car or home loan payment and are afraid that you would lose the property, then filing for bankruptcy would stop a repossession or foreclosure. Chapter 7 bankruptcy won’t allow you to catch up on the payments; however, filing for Chapter 13 bankruptcy would help you make the payments through a repayment plan.

·         The Discharge

If you file for Chapter 7 bankruptcy, all your debts would get discharged, and you won’t have to worry about creditor harassment. If you don’t want to remove debt and can afford to make payments but need some relief in the repayment schedule, you can file for Chapter 13 bankruptcy.

Disadvantages of Filing for Bankruptcy

·         Effect on Credit

This is one of the major drawbacks of filing for bankruptcy. Bankruptcy filings remain on the credit report of the individual for ten years. However, the obligation to repay debts is erased as all debts are discharged through filing for bankruptcy. The effect of bankruptcy on credit can affect your ability to qualify for a loan in the future.

·         Some Property Loss

If you aren’t able to exempt all of your real estate or personal property under the exemptions of bankruptcy, the court may seize some of your property and sell it. The money would then be used to pay off creditors.

·         Issues with Opening a New Bank Account

The account you already have in different banks might not be closed after you file for bankruptcy. However, most banks won’t allow you to open a new account following the bankruptcy.

Final Thoughts

If you think that the advantages of bankruptcy outweigh its cons for you, you could consider filing for Chapter 7 or Chapter 13 bankruptcy.

How to Rebuild Credit after Bankruptcy

Bankruptcy can take a serious toll on your credit scores. Not only that, but filing for bankruptcy makes it hard to get approved for new credit in the future. Therefore, bankruptcy seems devastating. However, filing for bankruptcy doesn’t mean that you will never be able to get any credit. It is possible to repair your credit after bankruptcy, and many people have actually been able to improve their credit scores and secure loans after a bankruptcy discharge. Below we explained a few ways to rebuild your credit after bankruptcy.

Rebuilding Your Credit after Bankruptcy

·         Make Timely Payments

If you want to rebuild your credit score, make sure to make timely payments. Many factors make up the credit score, and they are weighted differently. On-time payment is one of the important factors, and it accounts for up to 35 percent of the total score. This is why it is important to make payments on time. It is worth noting that only the payments that are reported to the credit agencies will have an impact on your credit score. These include credit-based accounts like personal loans, auto loans, mortgages, and credit cards. Paying for cell phone, electricity, rent, and other bills won’t affect your credit score.

·         Get a Secured Credit Card

You may be able to get a secured credit card even after filing for bankruptcy. With this type of card, you are required to make a deposit equal to the credit limit that you are allowed on the card. For example, a $400 credit limit requires a $400. You will have to manage the new credit card properly and keep in mind that the main reason you got this card is to rebuild credit. If you over-utilize your account or make late payments, your new card would hurt your credit rather than repairing it.

·         Monitor Your Credit Report

Credit reports are not perfect. There can be errors in them, which can affect your credit scores. Therefore, it is important to check your credit reports to ensure that they accurately reflect the bankruptcy. The accounts included in the bankruptcy should show zero balance. If you find any errors, dispute them.

·         Try a Credit-Builder Loan

Credit-builder loans are designed to help consumers build credit. They work differently than other kinds of loans. In this type of loan, you won’t get the money upfront. Instead, the lender will put the cash in a savings account. You would get the money once you have made all the payments. If you make payments on time, your credit score will improve.

·         Consider a Secured Loan

You can consider getting a secured loan to rebuild credit. These loans are backed by collateral like a vehicle which the lender can claim and sell if you aren’t able to repay the loan. These loans can be a good option for you if you can afford to make timely payments. Before applying, make sure to check the monthly payments, fees, and interest rate to see if you can afford the loan

Final Thoughts

Don’t lose hope if you have filed for bankruptcy. You can still rebuild your credit by trying the methods discussed above. In case you have any questions, feel free to write us a query.

How to Manage Your Student Loan Debts Using Chapter 13 Bankruptcy

Across the United States, an increasing amount of young people are graduating from universities heavily indebted with student loans. The total student debt in the country right now stands at an astonishing $1.5 trillion and the figure continues to rise rapidly. The current bankruptcy laws make it extremely difficult, if not impossible, to discharge your student loan debt.

However, that doesn’t mean filing for bankruptcy still won’t be worthwhile if you are struggling with repayments. Here is how to manage your student loan debts using Chapter 13 bankruptcy.

Benefit of Chapter 13

When you filed for bankruptcy, the court will immediately grant an automatic stay period that extends until the completion of the bankruptcy process. During the automatic stay period, all debt collection activity, including that of your student loan debt is prohibited, meaning you will not be harassed by your lenders to make regular repayments on your outstanding debt.

Instead, the court will create a new repayment plan for the duration of the bankruptcy (usually 3 to 5 years) based on your ability to afford. Since student loans are considered non-priority unsecured debts, you will not be required to repay the debt in full by the end of the duration.

Depending on your circumstances, the actual amount you would need to pay monthly could be significantly lesser. If the court determines that you have little or no disposable income than you probably won’t be required to pay any amount towards your student loan debts throughout the stay period.

A Word of Caution

Keep in mind that interest will still continue to accumulate on your student loans during the duration of the bankruptcy. In some cases, this could translate to a considerable amount you’ll have to pay back once the automatic stay period expires.

Another thing to be aware of is that the court’s meaning of “what you can afford” may differ from your own. It is not unheard of for filers to be given a plan which may heavily compromise their lifestyle. The aid of a seasoned attorney is vital to make sure the outcome is more in your favor.

Concluding Note

If you fail to repay your creditors on your student loan debts, the consequences could be terrible. It could severely hurt your credit score, you could be subject to a lawsuit, or have your wage garnished. Filing for Chapter 13 Bankruptcy can make repayments on your student loan debts much more manageable and help you avoid such predicaments.

More information on how the Federal Reserve’s recently lowered rates impact preexisting debt and refinancing options.

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