Bankruptcy Blog

Certain types of debt are considered non-dischargeable and will not be discharged or eliminated by filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. Federal bankruptcy law outlines all non-dischargeable debt for all states. Nebraska non-dischargeable debt will be the same as all other states. If you do not continue debt repayment for non-dischargeable debt, collection efforts can continue. All the debts below are non-dischargeable in the state of Nebraska:

• Federal, state and local taxes. May be subject to specific time rules.
• Spousal Support/Alimony
• Child Support Payments
• Most Student Loans
• Mortgage Liens
• Certain types of purchases for luxury items within 90 days of filing
• Secure Debt
• Penalties and fines by government agencies
• Fraud committed in a fiduciary role including larceny and embezzlement
• Punitive damages assessed for “willful and malicious acts”
• Debts not outlined on the schedule and forms filed with the Bankruptcy Court
• Drunk Driving fines
• Certain cash advances or purchases for luxury items with in a certain time frame.

Many people will not qualify to file Chapter 7 Bankruptcy and others have assets that they do not want to liquidate. Filing Chapter 13 Bankruptcy may be another option.. Chapter 13 Bankruptcy will not immediately discharge your debt, but will instead, allow you to create a 3 to 5 year bankruptcy plan to repay all or a portion of your personal debt. Many times the debt repayment schedule may have more favorable debt repayment options. At the end of the bankruptcy repayment schedule, if you have made all the necessary payments, your qualifying debt will be discharged.

The first step in Chapter 13 Bankruptcy is to contact a Nebraska Bankruptcy Attorney. A bankruptcy attorney will help you file your bankruptcy petition and schedules, create the bankruptcy repayment plan and appear in bankruptcy court.

Certain assets will be exempt from the bankruptcy process. The federal exemption list was created to allow individuals to maintain enough assets that can start over after filing bankruptcy. Federal bankruptcy law will outline the bankruptcy exemptions, but certain states have also created their own list of exemptions. Depending on the state where you live, you may have the option to choose between the federal exemption list and the state exemption list. In certain states you will only be able to use the state exemption list. In the state of Nebraska you are not allowed to use the federal exemption list and must choose the State of Nebraska Bankruptcy Exemptions.

Most people who file bankruptcy, file Chapter 7 Bankruptcy. Chapter 7 Bankruptcy is available for corporations, partnerships, individuals and couples. It is the quickest, easiest and least expensive type of bankruptcy. Chapter 7 Bankruptcy will allow you to discharge most of your unsecure debt.

The first step in the bankruptcy process is to contact a Nebraska Bankruptcy Lawyer. Your bankruptcy attorney will determine if you qualify for Chapter 7 or Chapter 13 Bankruptcy. If you can file chapter 7 Bankruptcy, your Nebraska Bankruptcy Attorney will submit you bankruptcy petition and a statement of financial affairs to the appropriate Nebraska bankruptcy court. The bankruptcy documents will outline all of your debts, the names of the creditors, the amount you owe, a list of your property and all of your expenses and income. A trustee will be assigned to sell all of your non-exempt assets and use the money from the sale to pay your creditors. Creditors will be paid based on their priority, which is outlined in federal bankruptcy law.

After the bankruptcy petition is filed, there will be an “automatic stay” and all debt collection efforts will be temporarily postponed until the bankruptcy judge determines there is “cause” to continue. After a four to six month period, most of your dischargeable debt including: hospital bills, credit card balances and unsecured personal loans will be discharged.

In 2005, the Bankruptcy Abuse Prevention and Consumer Act (BAPCA) passed which made it more difficult for many people to file Chapter 7 Bankruptcy. The goal of the legislation was to require more people to file Chapter 13 Bankruptcy and repay all or a portion of their debt.

The main provisions of the BAPCA includes completing credit counseling prior to filing bankruptcy, completing a financial management course prior to the discharge of your debt, and passing an income test to qualify to file Chapter 7 Bankruptcy.

The income test determines if your average monthly gross income is below the average monthly gross income for other Nebraska families of similar size. If you income is less then other Nebraska residents, you most likely will be able to file Chapter 7 Bankruptcy. If you income is above the average monthly gross income compared to other Nebraska residents, you will have to complete additional means testing.

Additional means testing will review your income minus pre-determined expenses such as your house payment, your car payment, child support payments, taxes owed, and school tuition (up to $1650). If you have a disposable income which will allow you to pay $6,000 or 100 per month toward your debt over the next sixty months, you may have to file Chapter 13 Bankruptcy. If you can not pay that much, but you could pay up to 25% of your disposable income toward your unsecured debt over the next sixty months, you may have to file Chapter 13 Bankruptcy.

State median data is provided by the United States Trustee Program. For the State of Nebraska, after March 15, 2009, the median income for a single wage earner in the state of Nebraska was $37,803 and for a family of two it was $53,453. For a family of three it was $62,814 and for a family of four it was $72,179.

The information provided above is very general and should not be considered legal advice. Means testing can be very complicated. It is important to contact a Nebraska Bankruptcy Attorney to determine if you can qualify to file Chapter 7 Bankruptcy.

Over the weekend CIT Group filed for bankruptcy protection in an attempt to cut $10 billion in debt from its balance sheets.

Economists say that the bankruptcy, which is the fifth largest ever filed in the United States, could impact small businesses across the country who have relied on CIT as a source of credit.

Many say the key to the commercial lender surviving its stay in bankruptcy court will be its ability to retain clients. One competitor has told the Wall Street Journal that it has already picked up several of the firms clients and that more keep coming.

In a pre-arranged deal approved by 90 percent of the voting debt holders, the company plans to restructure and emerge from bankruptcy by the end of the year.

The national economy has deteriorated over the last couple of years. With high unemployment and home depreciation, you may be suffering an economic crisis. If you have lost your job, had unexpected medical bills or high credit card balances and penalties you can not pay, you may be facing: home foreclosure, wage garnishments and property repossessions. If you are looking for a financial solution, filing bankruptcy may be an option for you or your family.

Federal bankruptcy laws have been created to allow individuals who are unable to pay their bills to discharge a portion of their debt by filing Chapter 7 Bankruptcy or develop a repayment plan by filing Chapter 13 Bankruptcy.

If you are unsure of your financial future and would like to discuss the option of bankruptcy, contact a Nebraska Bankruptcy Attorney who can help you determine if filing bankruptcy is right for you.

Federal bankruptcy laws also outline what type of debt can not be discharged by filing for bankruptcy. The types of debts not discharged in Louisiana will be the same as other states. If you do not complete your debt repayment obligations for these non-dischargeable debts, creditors will have the right to pursue all legal means necessary to collect them. The following types of debts are not dischargeable in the state of Louisiana:

• Federal, state and local taxes. May be subject to specific time rules.
• Spousal Support/Alimony
• Child Support Payments
• Most Student Loans
• Mortgage Liens
• Certain types of purchases for luxury items within 90 days of filing
• Secure Debt
• Penalties and fines by government agencies
• Fraud committed in a fiduciary role including larceny and embezzlement
• Punitive damages assessed for “willful and malicious acts”
• Debts not outlined on the schedule and forms filed with the Bankruptcy Court
• Drunk Driving fines
• Certain cash advances or purchases for luxury items with in a certain time frame.

If you own a home or property you would like to keep, or you do not qualify to file Chapter 7 Bankruptcy, filing Chapter 13 Bankruptcy may be another option for your family. Chapter 13 Bankruptcy will not be an immediate discharge of your assets but will require you to pay either a portion or all of your debt by creating a three to five year repayment plan. The benefit of filing Chapter 13 Bankruptcy is your assets will not be liquidated, and you may be able to develop a more favorable payment schedule.

A Louisiana Bankruptcy Lawyer will file your all the bankruptcy documents and will work with you to complete your bankruptcy repayment plan. After the completion of the plan, which will be three to five years, your qualifying unsecured debts will be discharged.

The Federal Bankruptcy code outlines certain assets or personal property which will be exempt from the bankruptcy process. The goal of the government is to allow individuals filing bankruptcy maintain certain assets. Exemptions are determined at the federal level, but many states have also created their own list of bankruptcy exemptions. Depending on the state where you live, you may be able to choose between the state exemption list or the federal exemption list. Other states will only allow you to choose the state exemption list. In the state of Louisiana you are only allowed to use the Louisiana Bankruptcy Exemption List.

If you have few assets and you qualify to file Chapter 7 Bankruptcy, it is the most popular, least expensive and fastest type of bankruptcy. Filing Chapter 7 Bankruptcy will allow for an immediate discharge of your debts.

The first step in Chapter 7 Bankruptcy is to hire a bankruptcy attorney who will file your bankruptcy petition and a statement of your financial affairs in the correct Louisiana Bankruptcy Court. These bankruptcy forms will include a list of all your creditors, the amount of debt you owe them, your income, your expenses and all of your property. Most debt collection efforts will be at least delayed through an “automatic stay”. Debt collection efforts may begin again if a Bankruptcy Judge decides there is “cause”.

A trustee will be appointed to work with your creditors and he will use the proceeds from the sell of your assets to pay them. Priority creditors will be paid first according to federal bankruptcy law. It will take up to four to six months for your debt to be discharged. Not all unsecured debt will be discharged, but common debt that may be eliminated can include: credit card debt, hospital debt, and unsecured personal loans. Chapter 7 Bankruptcy may be available for an individual, corporation, partnership, and married couple.

In the last four years, it has become more difficult to file Chapter 7 Bankruptcy. The Bankruptcy Abuse Prevention and Consumer Act (BAPCA) was passed in 2005, and required individuals to pass an income test to qualify for Chapter 7 Bankruptcy. The goal of this legislation was to force more individuals to repay at least a portion of their debt by filing Chapter 13 Bankruptcy. The legislation also required individuals to take a credit counseling course prior to filing for personal bankruptcy and complete a financial management course before their debt is dismissed.

If you would like to file Chapter 7 Bankruptcy, your median income in most cases must be below the state average compared to other families of similar size in the state of Louisiana. If your income is higher, a Louisiana Bankruptcy Attorney can help you complete additional “means testing”. In general the means testing will review your ability to pay your creditors by subtracting certain expenses such as your house payment, car payment, taxes owed and a certain amount of school tuition from your income. If you income minus these expenses leaves you enough disposable income to pay up to $6,000 or $100 per month to your unsecured creditors in the next sixty months, you will most likely have to file Chapter 13 Bankruptcy. If you fail this test, but you have enough remaining disposable income to pay 25% toward debt repayment in the next 60 months, you still may have to file Chapter 13 Bankruptcy.  This is general information. It is important to have a Louisiana Bankruptcy Attorney analyze your income and perform the means tests to determine if you can file Chapter 7 bankruptcy.

The median income for the state of Louisiana is published by the United States Trustee program. The State Median Income for the state of Louisiana after March 15, 2009, for a single wage earner is $36,945.  For a family of two it is $46,741, for a family of three it is $52,628 and for a family of four it is 66,634.

Louisiana’s economy is doing better than many states, but Louisiana has been affected in the last several months, especially with the drop in the cost of oil. If you live in Louisiana, you may be affected by the deterioration of the national economy and you may be facing overwhelming personal debt, expensive medical costs, job loss or a home foreclosure.

Many individuals find that filing bankruptcy may be one way they can discharge their personal unsecured debt and start again. Filing bankruptcy can help:

• Eliminate creditor calls
• Stop a home foreclosure
• End repossessions of your personal property
• Stop wage garnishments.

If you are facing a financial crisis, you are not alone. Over one million individuals filed bankruptcy in 2008. The Federal government has developed the bankruptcy process so individuals who are facing a financial crisis may discharge most of their unsecured debt through Chapter 7 Bankruptcy or create a more favorable debt repayment schedule by filing Chapter 13 Bankruptcy.

If you are considering filing bankruptcy in the state of Louisiana, it is important to talk to a Louisiana Bankruptcy Attorney. A Louisiana Bankruptcy Attorney will be able to help you determine if filing bankruptcy is the best course of action for your family and can answer all of your bankruptcy questions. A Louisiana Bankruptcy Lawyer will also be familiar with all the current bankruptcy laws and can determine if you qualify to file Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.

Filing Chapter 13 Bankruptcy or Chapter 13 Bankruptcy in Colorado will not discharge all of your debt. Federal Bankruptcy Codes have determined what debt can be discharged and in Colorado the following debts generally can not be discharged. The list is not exhaustive and a Colorado Bankruptcy Attorney should be consulted to review the type of debt you have and whether or not it will be discharged by filing Bankruptcy in Colorado.

• Federal, state and local taxes. May be subject to specific time rules.
• Spousal Support/Alimony
• Child Support Payments
• Most Student Loans
• Mortgage Liens
• Certain types of purchases for luxury items within 90 days of filing
• Secure Debt
• Penalties and fines by government agencies
• Fraud committed in a fiduciary role including larceny and embezzlement
• Punitive damages assessed for “willful and malicious acts”
• Debts not outlined on the schedule and forms filed with the Bankruptcy Court
• Drunk Driving fines
• Certain cash advances or purchases for luxury items with in a certain time frame.

All debts that are not discharged through the bankruptcy process may still be pursued through creditor’s debt collection efforts.