Apr25
A “Fresh Start” bankruptcy is available in Chapter 7.
Chapter 7 is designed for individuals who are called debtors who do not have sufficient income or property to pay their debts along with ordinary household or business expenses.
Under Chapter 7, individuals domiciled in Texas may choose Texas or Federal exemptions. The exemption laws exist so insolvency doesn’t mean an individual loses his or her home, car or truck, house furnishings, clothing, retirement and other listed personal belongings. You are required to pay for exempt property, and in most cases, you keep what you pay for. There are exceptions to every rule, I would be happy to discuss your case with you in person. A typical Chapter 7 Fresh Start Bankruptcy is a “no asset case.” This means the individual or joint, if husband and wife, do not hold or possess any non-exempt property that the Chapter 7 Trustee will sell to pay the individual or joint debtors’ debts. A Chapter 13 Reorganization Bankruptcy should be considered if an individual or husband and wife have non exempt assets. In Chapter 13, debtors are allowed to keep non exempt property and pay their unsecured creditors the value of their non exempt property.
A Fresh Start Bankruptcy Discharge takes 3-4 months after the individual or joint debtors’ case is filed. A Discharge of the debtor’s debt means the legal obligation of the debtor is wiped out or eliminated. A creditor or entity who the debtor owes cannot legally require a debtor to satisfy a debt that has been discharged in a Chapter 7 Bankruptcy. Types of debts that are discharged can include: credit cards, medical bills, unsecured loans, payday loans, collection agency, overdrafts, and deficiency claims after repossession and the sale of an individual or joint debtors’ car, truck or home.
Read More »
Apr04
My client, seventy (70) year old Sulphur Springs Texas resident, working full time at a local department store sought Chapter 7 bankruptcy protection from Sallie Mae and TERI/NCT, student loan creditors. (TERI stands for The Education Resources Institute; NCT means National Collegiate Trust). A discharge under Chapter 7 or Chapter 13 does not discharge student loans unless it is shown that repayment of student loans imposes an undue hardship on the debtor or his or her dependents by filing an adversary proceeding. In December 2009 TERI/NCT consented to judgment discharging approximately $41,200. In March 2010, Sallie Mae settled its $27,099.97 student loan debt for $4,500 with the Sulphur Springs Texas debtor.
By Brian Allen
Tags: adversary, adversary proceeding, Chapter 7, discharge, hardship, NCT, Sallie Mae, Student Loans, Sulphur Springs, TERI, TERI/NCT, Texas, undue hardship
Trackbacks (0)
Filed under Student Loans
Mar24
ISSUE: IN CALCULATING DISPOSABLE INCOME FOR CHAPTER 13 SHOULD COURT CONSIDER ACTUAL INCOME/EXPENSES OR LIMIT INQUIRY TO HISTORICAL FIGURES?
Hamilton v. Lanning
Argued: 3/22/10
No. 08-998
Court Below: 545 F.3d 1269 (10th Cir. 2008)
[Summarized by: Cameron Soran]
Full Text:
http://www.scotusblog.com/wp-content/uploads/2009/10/08-998_ca10.pdf
BANKRUPTCY (Whether when calculating the debtor’s projected disposable income during the plan period, the bankruptcy court may consider evidence suggesting that the debtor’s income or expenses are different than during
the pre-filing period)
Stephanie Lanning filed a Chapter 13 bankruptcy petition in 2006. Her income was above the median income before filing.
However, her income statement did not accurately reflect her financial situation due to a substantial “buy out” by her employer. If the court considered this aspect, then she was below the median income. The bankruptcy court decided to use the “forward looking” approach to her income since the more mechanical approach was not representative of her future income.
The Court of Appeals affirmed, ruling that the “forward looking” approach was appropriate in this instance since the alternative would call for payments that the debtor could never actually make. The Petitioner (the trustee) now argues that these determinations are contrary to the plain text of the applicable part of the bankruptcy statute and the legislative history.
