As 2011 draws to an end, many people will be thinking about filing Chapter 7 bankruptcy in Maryland in 2012. One very common question, almost always asked at the beginning of the year, is: IF I FILE CHAPTER 7 BANKRUPTCY IN MARYLAND, WILL I STLIL BE ABLE TO KEEP MY TAX REFUND? The answer is.............yes, in just about every case, you will be able to keep your tax refund. When you file Chapter 7 bankruptcy in Maryland, you are permitted to keep roughly $12,000 worth of "liquid" assets. That does not include your house. That includes, for most people personal belongings such as household goods and furnishings, automobiles that are fully paid off, money in savings and checking accounts, and certain other assets. One asset that people often forget is there tax refund. A tax refund, or an expected tax refund, is nothing more than money in a savings account held by the government that will be given to you after you file your taxes and show that you have overpaid your taxes, … [Read more...]
Establishing Credit After Bankruptcy During the Recession
A number of the people I counsel want to know how soon they can restore their credit after bankruptcy. The prerecession standard advice was two years for a credit card with decent interest and four years for a mortgage with indecent interest. But that was then. Now, because so many people have bad credit because of foreclosures, late payments, and bankruptcies, it's hard to say what decisions the credit issuers will be making in the next several years. Will they be more forgiving because of the need to pull in people who might not have qualified a few years ago, or will they get tighter and not give credit at all until more time has elapsed after the bankruptcy? Only Fair Isaac (FICO) knows for sure, sort of. For sure, if you want to reestablish credit, the old ways are probably still the best ways. Get a major credit card, periodically make purchases, scrupulously make your payments on time, get a second card, same thing, work to build your credit line, never max-out your cards, … [Read more...]
Does My Spouse Have To File Bankruptcy With Me?
No, your spouse does not have to file bankruptcy with you. There is no law stating that both people in a marriage must file bankruptcy. A married person can file a single bankruptcy. If a married person does decide to file without their spouse, some information from the non-filing spouse would be needed. The non-filing spouse’s income would have to be listed in order to do the means test and any joint property owned would also need to be listed. If any of the debt is in both your names, then you would want to consider having your spouse file. Once the debtor files bankruptcy, the co-debtor becomes solely liable for the debt. For example, if you and your spouse have both your names on a credit card, your spouse will become responsible for the debt once you file bankruptcy. Depending on the amount of debt and your individual situation, you may consider both filing bankruptcy. It is not mandatory for a married couple to file bankruptcy jointly. Each couples individual circumstances … [Read more...]
Utility Bills and Bankruptcy
Two Rules for Utilities and Bankruptcy When people are current with their utility bills, utilities rarely become an issue in bankruptcy. That is because Section 11 U.S.C. § 366(a), prohibits utility companies from discriminating against people based solely on bankruptcy filing. However, often being current is not the case and people seek to discharge their back utilities debts through bankruptcy. You can do that, but keep in mind there are two issues to consider. First, pursuant to 11 U.S.C. § 366(c)(4), a utility company has a right of set-off against your deposit. Meaning, the utility company can keep your deposit and apply it to your pre-petition debt. Second, pursuant to 11 U.S.C. § 366(b), the utility company may shut off your service on the 21st day following the filing of your bankruptcy petition if you are discharging a debt to the utility company and have not paid a post-petition deposit. In other words, if you file a bankruptcy and plan on discharging a debt … [Read more...]
Have a Debt Free 2012!
Happy Thanksgiving to all. If you are visiting our website during this time of the year, and you are thinking about filing for bankruptcy, you have taken the first step in the right direction to make you 2012 your best year ever. Too many Marylanders have so much credit card debt and other other debt that they literally cannot go entire day without thinking about their financial woes. Many, many years ago, our founding fathers realized that life, liberty and the pursuit of happiness INCLUDES the ability to seek debt relief and a fresh start in difficult times. That is why the right to file bankruptcy was inluded in the first draft of our United States Constitution. It is your right, and if you don't use it, you are giving up one of the greatest benefits of living in this country. Chapter 7 bankruptcy in Maryland allows you to eliminate credit card debt, medical bills, judgments, garnishments, repossessions and all other unsecured debts except student loans and most debts to … [Read more...]
Facing Foreclosure in Maryland? Read This.
Mortgage Assistance companies and credit counselors are not lawyers and they can’t explain the legal ins and outs about the bankruptcy laws. Not that they want to, because telling someone to see a lawyer about Chapter 13 bankruptcy might be a better option for the homeowner, but it won’t put a fee in the company’s bank account. All too often, these companies will assure the homeowner that they can help, only to notify them that they can’t do a thing – after they have collected their fees and often mere days before the foreclosure – leaving the homeowner with no time to fully explore bankruptcy or other legal solutions. Many companies are disreputable; taking money but doing nothing. What a mortgage assistance company does is collect a fee to help a homeowner workout a repayment plan with their mortgage company. The fee is often a full mortgage payment, non-refundable, and there are usually no guarantees that the payment plan will be one the homeowner can afford. Any homeowner … [Read more...]
I Need To File Bankruptcy and I live in Maryland…..What Do I Do?
Sort of like parenting, money management is one of those things that were never taught in school. We were taught to read, write and do some math problems that we will never have to use in real life, but we were never taught how to pay our bills and manage our finances, especially in difficult times. And our parents (at least mine didn't) brought us over to the kitchen table and said "hey son, let's go over my checkbook together and see how we can improve our finances. Unless you are actually in the business of helping people file for bankruptcy, there is no reason for you to have any idea what bankruptcy is all about. Fortunately, the internet has provided everyone a tool to research and read about bankruptcy, and at least give them a starting point to determine if it is the right thing to do, and if so, how to go about filing bankruptcy. If you are reading this article, you have already taken the first step. When people call me to discuss bankruptcy, they have alot of … [Read more...]
Ten Things To Do BEFORE FILING BANKRUPTCY
Bankruptcy is very often a time-sensitive process and pre-bankruptcy planning can be critical in protecting assets. Chapter 7, in particular, the trustee’s responsibility is to “look back” at the actions the debtor has taken to insure that there hasn’t been a fraudulent conveyance of assets, a non-allowed preference payment to creditors or other actions that might leave assets exposed. It’s critical, if you are considering bankruptcy, to consider taking the following steps to insure a successful filing: 1. Consult with an attorney. The bankruptcy laws have become so complex that consumers should not attempt to file by themselves. It’s a very risky process to try to do on your own. Since 2005, there is a complicated “Means Test” required, government-approved credit counseling, as well as other changes which made the filing of Bankruptcy much more complicated. Even if you eventually file pro-se (representing yourself) consult an attorney and ask questions about whether … [Read more...]
Chapter 7 Maryland Bankruptcy or Chapter 13 Maryland Bankruptcy?
Bankruptcy may provide some relief to a borrower under financial stress and overwhelmed with debt. Typically, there are two types of bankruptcy available to a debtor, Chapter 7 bankruptcy and Chapter 13 bankruptcy. The requirements and benefits offered by the two types of bankruptcy differ greatly. A Maryland bankruptcy attorneycan explain the differences between the two chapters in detail and help ensure a successful bankruptcy filing. It is highly recommended that a debtor consult a bankruptcy lawyer for help determining which bankruptcy chapter is best suited for their situation. An incorrect or incomplete bankruptcy petition can create long-lasting consequences for the debtor. Chapter 13 is considered a restructuring bankruptcy because the debtor continues to make payments to their creditors according to a court approved payment plan. The payment plan outlines how the income the borrower receives will be used to pay off the debts owed. Once the payment plan is confirmed by the court … [Read more...]
Third Most Chapter 7’s In Maryland Filed!
Usually I write about or I find important or interesting issues on Bankruptcy and post them on this blog for anyone who happens to drop by the website to see. Today, however, my post is a little different. Today it's about my bankruptcy firm, and yes, I am going to do a little bragging. I have been practicing bankruptcy law in Maryland for almost 20 years. In 2005, however, when the laws changed, I stopped doing it for a while. My thought was that everyone and their mother (sometimes literally) had just filed Chapter 7 bankruptcy in Maryland during that prior year and the amount of people in Maryland to help with bankruptcy's would be very few in the next few years. So I changed my practice and concentrated more on Family Law. But in 2009, shortly after the recession hit full swing, I realized that, with so many people out of work and out on disability and without health insurance, the need for Chapter 7 and Chapter 13 bankruptcy's in Maryland would soon rise again. So, … [Read more...]
