California Bankruptcy Lawyer Blog

San Jose Bankruptcy Attorney  explains why bankruptcy attorneys and potential filers should closely watch an upcoming U.S. Supreme Court case.

The United States Supreme Court recently heard arguments on a case brought by a bankruptcy trustee from Pennsylvania. At issue is whether a debtor in a Chapter 7 bankruptcy can exempt personal property from seizure to pay her debts by claiming the property is worth exactly the amount exempt under law, regardless of its true value.  The trustee, William Schwab, is appointed to the position by the U.S. Department of Justice and serves as a sort of referee looking out for the interests of the debtor, the creditor, and the law, in Chapter 7 bankruptcy cases. The trustee’s decisions are overseen by a bankruptcy court judge, who has final jurisdiction in the case.

The case before the court involves a caterer who declared that her kitchen equipment was valued at $10,700, which is the exemption limit for a Chapter 7 bankruptcy filing.  Schwab had the equipment appraised and its value was determined to be $17,200, well above the exemption limit.  Schwab contended that the equipment should be sold and anything above the exempt amount would be distributed to creditors.  The Bankruptcy court disagreed, and the appeals have landed the case before the Supreme Court because in five circuit courts of appeal rulings of similar cases, three have gone one way, and two have gone the other.  So the Supreme Court will make a ruling that will create something resembling a uniform standard across the country.

Your San Jose bankruptcy attorney can guide you through determining what is exempt in bankruptcy and what is not exempt in bankruptcy.  Bankruptcy is a complex procedure that requires a knowledgeable, experienced bankruptcy attorney to help you receive the best possible outcome under the law.

Pocono attorneys win airing from U.S. Supremes, Pocono Record, November 9, 2009

If you have a question regarding Bankruptcy in San Jose please contact us at 408.279.2288 or visit www.bkanswers.com and we can connect you with one of our experienced San Jose Bankruptcy Attorneys.  After you have spoken with one of our San Jose bankruptcy attorneys we can schedule you a free face to face appointment in our office location nearest you.  Our team of San Jose 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,  stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your financial needs.  Please feel free to complete our free bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose Bankruptcy Attorney Talks About Southwest and Frontier Airlines

As a possible sign that the economy is turning a corner, Southwest Airlines made a bid of $113.6 million to buy Frontier Airlines. Frontier Airlines has been operating under Chapter 11 bankruptcy protection since April 2008. The bid is good news for Frontier Airlines because the more money it can raise, the better the chance that the company and all its employees can survive the chapter 11 bankruptcy. Although the purchase may mean the eventual demise of the Frontier name as Southwest absorbs its planes and routes. This move would help Southwest gain market share including busy Chicago.

The real news by the offer is that Frontier already had an offer of $108.8 million but Republic who would have allowed Frontier to keep operating under its own name. When there are multiple bidders then that is a sign that competitors are healthy enough to expand or that there is credit flowing. Either would be a distinct difference from the current news of global slowdowns or lack of credit.

At this time, it is too soon to tell but if companies in bankruptcy can emerge (such as Ford) or be brought (such as Frontier) then bankruptcy will no longer mean one foot in the grave, just an opportunity to relaunch.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Francisco Chapter 11 bankruptcy Attorney Discusses the Sick Fascination with the Chrysler and GM Bankruptcies

There is a sick fascination with the Chrysler and GM chapter 11 bankruptcies. The Chrysler one in particular is of special interest because the US government, including President Obama have taken an active hand in their bankruptcy. The government has put in several billions of dollars in loans and bail out money to ensure that Chrysler survives. President Obama has verbally come out supporting the bankruptcy filing and condemning the creditors. Even foriegners are involved as Fiat is trying to buy part of Chrysler. After 35 days, the Chrysler Bankruptcy has hit a wall. Several creditors have filed legal objections to prevent the bankrupcty to continue. About 300 Chrysler franchise owners have also filed objections to the sale or closing of their dealerships. These objections reflect some of the conflicting interests in the shut down of a major US company. One creditor, Indiana State Pension, has filed an objection because they have about $45 million at stake (out of several billions) which (they believe) are not being treated as well as other less preferred creditors. While this claim is a common one in bankruptcy court, it has caught the interest of public because it has all the makings of a David and Goliath showdown in court. As for the dealerships, they claim that they cost Chrysler nothing because Chrylser does not actually own those cars as the dealers have to pay for them. The Dealerships only help Chrylser by selling its product and closing the dealerships will amount to hundreds of lost jobs. Again, the public is interested because nobody wants to see empty lots and unemployed neighbors.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

Sacramento Bankruptcy Attorney Discusses the Current Foreclosure and Bankruptcy Crisis, along with FEMA

If there was ever a silver lining in the current foreclosure and bankruptcy crisis, then it would be the ingenuity of the solutions that get sparked. The latest one comes from Florida. There is a proposal on the table to allow FEMA to use foreclosed properties to house people displaced by hurricanes. Basically, instead of building new homes or while the homes are being built, the displaced can use homes in Florida that have been abandoned and owned by the banks. The idea seems win-win. Banks have no ability to sell these properties anyway in this market and the displaced need a place to live. FEMA would be able to use the resources already available to carry out its mandate. Communities like the idea because it will mean no more empty houses which invites vandalism and decreases property values.

Of course, as with an good idea, there are nay-sayers. The first problems are the logistics such as who would be picked, how they would get to the new housing, and how it would matched (for example the right house for the right sized family). The next problem is a long term situation. What happens when the market turns or if the bank needs to actually sell the property? Can they evict the tenants and what rights would they have? Finally, there is a moral challenge, should Florida be using the displaced victims as a means to jump start their faltering real estate situation? Whatever the answer may be, the most valuable lesson is that even in calamity, there is opportunity.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose Bankruptcy Attorney Discusses how the NHL's Phoenix Coyotes filed for protection under Chapter 11

Every part of the country no matter in what field that you work in is affected by the current downturn in the economy. Even sports teams are not isolated from the perils of bankruptcy.
In the week of May 12, 2009, the NHL's Phoenix Coyotes filed for protection under Chapter 11. Perhaps if Chrysler's bankruptcy hadn't been stealing the headlines this item would have made more waves. What makes this case interesting, obviously, is the fact it is a professional sports franchise. As such, there are a lot of big time sports stars that are waiting for their paychecks until the Bankruptcy Court approves the payment of pre-petition wage claims. None of those names is bigger than the Great One himself, Wayne Gretzky. Gretzky is in the hockey hall of fame, but he still may not get paid for all those goals scored. In total, the Coyotes have asked to pay over half a million dollars in pre-petition wages. Along with his salary, Gretzky is also a creditor of the estate to the tune of $8 milliion in deferred compensation. A Chapter 11 bankruptcy is a repayment plan that has to accepted by all the creditors as well as the bankruptcy trustee. Therefore, until the plan is adopted, The Coyotes are going to have to come up with the money to play their players.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose Bankruptcy Lawyer Discusses Six Flags Theme Park Filing for Bankruptcy

It's the summer and there's nothing better than heading out to your local theme park for some crazy rides. But if you're headed to a Six flags Theme Park, you better enjoy it while you can because even they are not insulated from the worsening economy. The New York Times reports that Six Flags, the big theme park operator, filed for bankruptcy in early Saturday morning in Delaware after failing to reach an agreement with lenders over a plan to reorganize its debt outside of court. Six Flags became only the latest company to prove unable to cope with its debt load at a time when previous solutions like refinancings are largely unavailable. The theme park operator, which had $2.4 billion in debt, faced nearly $300 million in payments to preferred stockholders due in August. But the company is hoping to make its ride through bankruptcy a short one. In a statement, Six Flags said that it is seeking court approval for a pre-negotiated restructuring plan, one that has the unanimous approval of its lenders. That proposal would eliminate $1.8 billion in debt and slice off the $300 million in preferred stock payments. “The current management team inherited a $2.4 billion debt load that cannot be sustained, particularly in these challenging financial markets,” Mark Shapiro, Six Flags’s chief executive, said in a statement. “As a result, we are cleaning up the past and positioning the Company for future growth.”In its bankruptcy filing, Six Flags said that 37 of its subsidiaries, including parks like Great Adventure and Hurricane Harbor, had also sought court protection. The parks will continue to operate normally, but analysts have questioned whether attendance would fall off as some consumers shun waiting in line for roller coasters at a bankrupt theme park operator. Six Flags said in its statement that the filing comes despite a good 2008, in which the company cut its net loss to $135 million from $275 million a year ago. Its net loss for the first three months of 2009 narrowed nearly 7 percent from the same time in 2008, to $146.3 million. But the company saw a 24 percent drop in revenue over the same period, as it suffered from lower attendance and spending at its parks.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

Fremont Chapter 11 Bankruptcy Attorney Talks About Lenny Dykstra CH 11 Bankruptcy

For most of the United States, the name Lenny Dykstra is a baseball favorite that played for the Mets and the Phillies. For those who have kept an eye in the market world, the name Lenny Dykstra is a stock picker who markets his system for beating the market by claiming he has made over 100 winning stock picks. The first irony is that both are the same person. Lenny Dykstra has leveraged his brand name into a business to push his system of portoflio management. The second irony is that he just filed for Chapter 11 Bankruptcy.

Before we start shaking our head at a shooting star that flashed out, Mr. Dykstra is hardly a pauper with a hat in hand. He filed bankruptcy to stop a foreclosure on his property appraised at $25 million when he brought it for $17.5 million. Like most bankruptcy's today, Mr. Dykstra is a victim of a real estate scheme that went awry. Lenny needed $17.5 million to buy Wayne Gretzky's (yes, that Wayne Gretzky) estate. He was unable to get all the money in one loan (he could only get a $12 million dollar loan) so he had to take a second loan. Lenny, showing some dubious financial savvy, took an $8 million dollar second loan which resulted in $2.5 million dollars over the buying price. Theoretically, Lenny had more than enough equity to cover.

But that left Lenny with a $200,000.00 a month mortgage payment with his $125,000 income. Lenny tried to refinance and learned that being a baseball star does not open up the credit market to you. So he filed for Chapter 11 bankruptcy. Rumor is that Lenny is worth over $15 million dollars due to his winning market action. If that were true, did he really need to file bankruptcy?

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose CH 11 Bankruptcy Attorney Talks About GM Chapter 11 Bankruptcy

GM has shown indicated that it plans to exit out of Chapter 11 Bankruptcy before the end of July. For those keeping track, GM went into CH 11 bankruptcy in June. That means in less than 2 months, GM was able to restructure its debt and emerge a leaner company. There was no financial magic that allowed for such a quick recovery, just a simple divide of the GM pie. The US government now owns about 60% of the new GM, 11% owned by Canada, 17% owned by a union controlled health care trust, and 10% by GM bondholders. GM shareholders receive nothing.

GM's unsecured debt of $54 million is shrunk down to a fraction of that amount. Other unwanted contracts and liabilities (which were not sold to foreign investors) will be held by the old company under a new name, Motors Liquidation Co. The company will dispose of the assets over the next few years.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose Bankruptcy Attorney discusses another Chapter 11 Bankruptcy Success Story

Delphi Corporation, once the world’s largest auto parts manufacturer, is likely to emerge from Bankruptcy within the next few weeks. Delphi has refocused its product line to supplying powertrain components, connectors and wiring harnesses, and teamed other products and divisions.

With a large contribution from General Motors (GM) comprised of approximately $2 billion in cash and a $500 million loan, Delphi projects to be profitable within 12-18 months of emergency from Chapter 11 bankruptcy.

Utilizing the protections provided during the pendency of its bankruptcy, Delphi has been able to cut restructure its debt, dispose of underproducing plants and restructure its facilities. Delphi is expected to exit its CH 11 bankruptcy small but with a more global presence.

Delphi is another example of the benefits of restructuring through a Chapter 11 bankruptcy proceeding. Once a cash starved company teetering on the brink of collapse, Delphi now has the potential to emerge leaner and more profitable than ever before.

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, 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 bankrupcty evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.

San Jose Bankruptcy Attorney Talks about the Chrysler Bankruptcy

On April 30, 2009, Chrysler’s filed for a Chapter 11 Bankruptcy. The Chrysler Bankruptcy would be a huge undertaking because the company is one of the big three automakers in the United States. To see how this bankruptcy will work, it is helpful to look at a different large bankruptcy. In late 2008 and early 2009, the Circuit City Bankruptcy rocked the retail world because it signaled the shut down a major player in products that consumers purchase on a regular basis. Circuit City filed for Chapter 11 bankruptcy which is what Chrysler would do. Under the Chapter 11 bankruptcy, Circuit City was able to continue business including selling during the holiday season and pay their employees for the work. Circuit City was given protection against creditors while it looked for a new source of capital or a buyer. Neither could be found so Circuit City had to be shut down.

In Chrysler’s case, they have Chapter 11 creditor protection while it looked for solutions to its problems. Based on reports, Chrysler had to file for Bankruptcy so that it could close the investment from Fiat of Italy. Fiat had previously been identified as a potential buyer ranging from a 20 percent to 35 percent stake in the company. Chrysler owes $6.9 billion to lenders and once a few begin collections, could cause the whole company to shut down. (A car cannot be sold unless it has all the parts, like the wheels) The Chapter 11 protections are needed because Chrysler needs to continue operating while the deals are being worked out.

The straw that broke the camel’s back and forced Chrysler into bankruptcy is being blamed on a small minority of creditors. The lenders originally wanted 65 cents to the dollar with a 40 percent equity stake in whatever company Chrysler becomes. The government wanted the lenders to get 22 cents on the dollar with 5 percent of the new company. The key note was that government came to the table with money to help finance any deals but wanted to spend as little as possible while the lenders want as much as possible. The risk for the lenders was that the deal fell apart and Chrysler was liquidated similar to Circuit City where they could receive much less than 22 cents on the dollar and only after items have been auctioned off. (One can imagine that there are few buyers of car building plants in the US) The other risk was that under Chapter 11 laws, Fiat (or any other buyer) can choose which assets to keep and which to get rid. This pits the lenders against each other as the owners marquee property can command a premium while the undesired debts are left with hats in hand asking for bail outs.

In the end, most of the major lenders agreed to the government’s proposal prior to bankruptcy but a few minority lenders held out. The final group of lenders who withheld approval were called “speculators” by President Obama. Many of the lenders were hedge funds and boutique investment funds who alleged that the big banks were yielding to the government’s proposal because of prior bailout money. Now that bankruptcy is filed, the decision as to whether Chrysler’s plan is accepted or not will lie with the Bankruptcy Judge instead of the lender’s hands.

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, stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your needs.

Redwood City Bankruptcy Attorney Talks About the Different Trustees

After a Debtor files for a Petition for Bankruptcy, the Debtor enters a legal world where any words, called "terms of art" are used. This is the lingo or slang that the Bankruptcy Court, bankruptcy attorneys, and everybody else in the bankruptcy world are using to describe a Bankruptcy case. Some of the common terms are Debtors, Creditors, Court, and Trustee. While Debtors and Creditors are fairly self explanatory, some of the others should be clarified. When referencing the Court, the user is referencing the Judge, the Court Staff, and the Court Clerk. Therefore when the Court makes an order, the reality is that Judge made the order. Or if the papers are filed with the Court, then the papers are probably submitted to the Court Clerk or part of the official file. Finally, if the Court will provide a translator that is probably the Court Staff setting up the logistics.

When referencing the "trustee," the Debtor should be aware that there are at least 3 different kinds of trustee. There is the Panel Trustee who has the job of administering the bankruptcy estate. (As a reminder, when a Debtor files for Bankruptcy, the government "takes over" the debtors assets which is now called the "bankruptcy estate.") The Panel Trustee is supposed to try and get as much money as possible from the bankruptcy estate to make sure that the creditors get what they can. The Panel Trustees are not paid by the Court but rather get paid from the filing fees or from a percentage of the money distributed to creditors.

The Standing Trustee is a title usually reserved for Chapter 13 and Chapter 12 bankruptcies. The Standing Trustee has the job of collecting the monthly payments from Debtors and paying out the creditors per the agreed upon repayment plan. The Standing Trustee does not get paid by the Court either but does collect a percentage of the money distributed.

Finally there is the US Trustee. These Trustee's are part of the Department of Justice and are separate from the Court. They main role is to be a watchdog in the bankruptcy proceedings. They are to monitor a bankruptcy, supervise the other trustess, and identifying fraud. In practice, the US Trustee will review all bankruptcy petitions, pleadings, and will participate in hearings if necessary. The US Trustee is the one most likely to bring a motion to dismiss a bankruptcy if they find any errors.

If you have a question regarding Trustees please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Attorneys can assist you with all aspects of your case. We have attorneys in San Mateo, Monterey, Fremont, Salinas, Sacramento and San Jose.

San Jose Bankruptcy Attorney Discusses the Chapter 7 Means Test

It is inevitable if you are considering filing bankruptcy that you will hear about the Means Test. Before the bankruptcy laws were changed, a person who wanted to file for bankruptcy could file for a Chapter 7 or Chapter 13 based on their preference. However, under the new laws, the first step in determining if you can file for Chapter 7 bankruptcy is the amount of income you make. It is a measurement of your current monthly income against the median income for a household of your size in your state. If your income is less than or equal to the median, you can file for Chapter 7 bankruptcy. If it is more than the median, however, you must pass the Means Test in order to file for Chapter 7.

The purpose of the means test is to figure out whether you have enough disposable income, after subtracting certain allowed expenses and required debt payments, to make payments on a Chapter 13 plan. To find out whether you pass the means test, you subtract certain allowed expenses and debt payments from your current monthly income. If the income that's left over after these calculations is below a certain amount, you can file for Chapter 7. IF you do not pass the Means Test, you’re unable to file for Chapter 7 bankruptcy, where your debts are discharged, and you may have to file a Chapter 13 bankruptcy where you will have to come up with a payment plan.

If you have a question regarding Bankruptcy please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Attorneys can assist you with all aspects of your case. We have attorneys in San Mateo, Monterey, Fremont, Salinas, Sacramento and San Jose.

Fremont Bankruptcy Attorney Talks About Chapter 13 Plan Payments

Debtors in a Chapter 13 bankruptcy have agreed to a repayment plan to their creditors. Specifically, in the bankruptcy petition, the debtors propose a Chapter 13 payment plan. The plan will pay off certain secured and priority creditors in full and then, if feasible, unsecured creditors will get none, some or all of their claims paid off. The amount that unsecured creditors receive varies based on the debtors’ income and expenses. This amount is calculated by a formula that was created by the US Government which severely limits the type of expenses that debtors can claim.

Once a plan payment is proposed in the Chapter 13 Bankruptcy Petition, the US Trustee and court must approve it. There are a few levels of review but, ultimately, a plan is approved for a term of either 36 months or 60 months. Once approved, the Debtors are expected to pay this amount each month, on time, in either a cashier check or money order.

If Debtors cannot make the payments make the payments for any reason, it is much better to be proactive than reactive. The Debtors should contact the Trustee’s office by phone or letter to explain why the payment shall be late. Specifically, the Debtors should explicitly outline when the payment will be made or how the late payment will be repaid at a later date. For example, if the payment will be 1 week late, then a phone call and letter stating that it will be 1 week late is acceptable communication. However, if the Debtor needs to miss a month and wants to make up the payment over a series of payments, the US Trustee should contacted and the repayment plan approved. Finally, if the Debtors can no longer make the payments due to a change in circumstances, such as injury or loss of employment, the US Trustee needs to be contacted so that they can consider their options. The options include permanent modification of the plan, conversion to a chapter 7 bankruptcy, or dismissal of the chapter 13 plan all together.

If you have a question regarding your Chapter 13 Plan please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Attorneys can assist you with all aspects of your case. We have attorneys in San Mateo, Monterey, Fremont, Salinas, Sacramento and San Jose.

Sacramento Bankruptcy Attorney Talks About Finishing a Bankruptcy

When a debtor files a Petitioner for Bankruptcy, the US Trustee is now officially the owner of all of the debtor’s assets. The US Trustee is so intertwined with the debtor’s finances that the debtor may not even make a major purchase, such as a new car, without the US Trustee or Court’s permission. This raises the question, once the US Trustee is involved in a debtor’s business, how does one get the US Trustee out?

The real answer is that the US Trustee is involved until the end. The end, in a bankruptcy, is either when the debtor’s bankruptcy case is dismissed or discharged. A dismissal occurs when the debtor’s bankruptcy petition is not granted for various reasons. One reason could be that the debtor voluntarily dismissed because they no longer wanted the bankruptcy. Another reason could be due to noncompliance by the debtor in one shape or form which causes the Court to dismiss the petition. In either case, a dismissal usually means that debtor may refile their bankruptcy petition although a waiting period may be put in place. Once dismissed, the US Trustee no longer has any interest or control over the debtor’s assets.

In a discharge, the Bankruptcy Court makes a final ruling in favor of the debtor and has discharged all remaining debts. For a Chapter 7 bankruptcy, the discharge will occur relatively quickly and can happen within 90 days of the filing. For a Chapter 13 bankruptcy, the discharge is not complete until all the plan payments are done. In either case, once discharged, the US Trustee no longer has any interest or control over the debtor’s assets. That means the debtor is free to go shopping for a new car or sell whatever assets they walk away with.

If you have a question regarding discharge please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Attorneys can assist you with all aspects of your case. We have attorneys in San Mateo, Monterey, Fremont, Salinas, Sacramento and San Jose.

San Jose Bankruptcy Attorney Talks About Dismissal

When a debtor files a petition for bankruptcy, the debtor may go for several weeks without hearing anything about their papers. This is typical because once filed, the US Trustee’s office must review the petition for accuracy and completeness and creditors get a chance to object, file proof of claims, or file adversary proceedings. During this time, the debtors can usually voluntarily dismiss their bankruptcy petition.

Why would a debtor dismiss their petition? There can be many reasons. The most common one is that their major creditor, who had previously refused to even to answer phone calls, suddenly has an interest in settling. For example, a mortgage lender who had declared that no relief could be given, may suddenly decide that the debtor’s do qualify for a drop in interest rates or are willing to extend the loan on more favorable terms. Alternatively, a credit card company may decide that they only want half of their bill paid. In those cases, the debtor may not be able to agree to such a deal without first dismissing the bankruptcy.

Another common reason is that the debtor’s situation has changed. For example, the debtors may have lost their job or just had a baby. The debtors may have come into money or found a new job. Either one of these situations may affect their bankruptcy and the debtor may be better served to dismiss their current case so that they may refile later.

Finally, the US Trustee may want the debtors to dismiss their case. The Trustee, upon review of the papers, may believe that the debtors do not qualify for bankruptcy and may file a motion to dismiss. To avoid a court hearing, the debtors may decide to dismiss their petition rather than have a judge decide the outcome.

If you are in the middle of bankruptcy and wish to dismiss so that you can refile, please consider contacting Sagaria Law for a consultation 1-800-941-6730 or www.sagarialaw.com.

San Jose Bankruptcy Attorney Discusses California’s East Bay, Efforts By Bankruptcy Trustee To Collect Money Angers Creditors

A number of investors who lost money when trusting East Bay investment executive Francis "Bill" Reimers to make investments for them are angered by the decision of a federal trustee to get money from them as part of the bankrupty proceedings involving Reimers and his companies. At least 20 individuals say they collectively lost $10 million dollars in investments because of Reimers. Yet bankrupty trustee John Kendall may have grounds to collect payment from them for the money that Reimers owes because these investors became creditors the moment Reimers filed for bankruptcy. The trustee has claimed in court records that the transfers of money up to one year prior to Reimers filing bankruptcy were "preferential" or "fraudulent."

Attorneys for Kendall have filed complaints asking for a combined total of $5 million from at least 36 parties. 30 of these parties are individual investors. Six of them are companies. The trustee is demanding about $828,000 from one local Benicia investor.The trustee is also demanding $693,000 from American Express Credit, $258,000 from First USA Bank, $58,000 from Bank of America, $16,000 from MBNA America, and $6,200 from Banc One Credit Card.

Reimers had filed for involuntary bankruptcy.

There are three types of trustees in bankruptcy cases.

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