Oakland Bankruptcy Attorney comments on the dramatic rise in Chapter 11 bankruptcy filings by wealthy individuals
Oakland Bankruptcy Attorney comments on the dramatic rise in Chapter 11 bankruptcy filings by wealthy individuals
Wealthy individuals have not been spared the wrath of this current recession. According to Bloomberg News
Service, Chapter 11 bankruptcy filings by wealthy individuals rose 73 percent over 2008 filings in the second quarter. Many experts are blaming the dismal real estate market for the rise in Chapter 11 filings.
The real estate downturn has caught many wealthy individuals in the “perfect storm” as their investment portfolios and property values declined dramatically as their income was reduced. This left many of them unable to service the highly-leveraged debt they incurred on the properties that are now upside-down in value.
The 2005 bankruptcy reform laws passed by Congress included a means test for bankruptcy filing. Individuals and couples with more than $1,010,650 in secured debt and $336,900 in unsecured debt are prohibited from filing a Chapter 7 liquidation or Chapter 13 bankruptcy reorganization. Instead, they are required to file a Chapter 11 bankruptcy reorganization plan and the difference is dramatic.
A typical Chapter 7 or Chapter 13 bankruptcy filing can cost between $1,500 - $6,000 and often includes only one hearing. A Chapter 11 filing can easily cost $15,000 - $30,000 and included multiple contested hearings as creditors fight over payouts from the assets. A Chapter 7 or Chapter 13 bankruptcy filing is often completed in just a few months, while a Chapter 11 filing may drag on for years as creditors wrangle for control of assets.
If you have a question regarding Bankruptcy please contact us at 1-800-941-6730 or visit www.bkanswers.com and we can connect you with one of our experienced Bankruptcy Attorneys. After you have spoken with one of our bankruptcy attorneys we can schedule you a free face to face appointment in our office location nearest you. Our team of Bankruptcy Lawyers can assist you with all aspects of your case. If you are have questions about filing a chapter 7 bankruptcy, a chapter 11 bankruptcy, a chapter 13 bankruptcy, lien stripping, cram down, a stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your needs. Please feel free to complete our free bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.
