Some Private Student Lenders To Offer Loan Modifications

Written by Peter Mullison, Colorado Bankruptcy Attorney

Private Student Loan Modifications(Photo from Flickr user thisisbossi used under Creative Commons license)

If you have been researching your repayment options for student loans, you probably know that only federal loans offer modification options, such as income based repayment. Historically, most private lenders have not offered any sort of modification and have a reputation for not working with customers who are having difficulty repaying their loans.

That may soon be changing. Two private lenders, Wells Fargo and Discover Financial Services, have announced that may soon be offering modification options to customers who are dealing with financial hardship.

Wells Fargo has said they will consider lowering the interest rate for someone who is having financial trouble. They have also said that the loan doesn’t need to be in default to qualify for a modification. The reduction of interest may be temporary or permanent.

Other lenders have also stated that they will start offering modifications. You can read more here.

If you have questions about how to deal with student loan debt, including how bankruptcy may be able to help, we hope you’ll come in for a free, no-obligation consultation with an experienced Colorado bankruptcy attorney. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

 

We are Denver, Colorado bankruptcy attorneys. We help people who have been blindsided by life's unexpected events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

 

 

Do I Have To Tell The Bankruptcy Court About Debts I Owe To Family Members Or Friends?

Written by Peter Mullison, Colorado Bankruptcy Attorney

Do I Have To List All Of My Debts

It’s not unusual for a client or potential client to ask me if they have to list all of the people they owe money to. The question will come up either in the initial consultation or at the time we’re reviewing their petition and going over the schedules that list their creditors. Oftentimes, they want to avoid listing their landlord. They’re embarrassed about having to file bankruptcy and want to avoid other people finding out. Other times, they owe money to friends or family members and, again, they want to avoid them finding out.

My answer is always the same: when you file bankruptcy, the Bankruptcy Code requires you to list all of your debts. It doesn’t matter who they money is owed to or if you “plan on paying it back.”

A recent 7th Circuit Court of Appeals case highlights the dangers of not listing all debts on a bankruptcy petition. In In re Katsman, Ms. Katsman had filed a Chapter 7 bankruptcy. Katsman’s ex-husband’s son brought a lawsuit in bankruptcy court arguing that she should not receive a discharge because she “made a false oath or account” on her bankruptcy petition when she failed to disclose several creditors, including him. At trial Katsman admitted that she had left four creditors off her petition, but the bankruptcy court had found that her doing so was not fraudulent. The son appealed.

The Court of Appeals found that she had made other omissions in her petition, including real estate that she owned with her ex-husband and alimony payments she received. The appeals court found that “her many false statements bespeak a pattern of reckless indifference to the truth, implying fraudulent intent.” The court held that Katsman was not entitled to a discharge order. Now, not only will she have to repay the debts she owed to the creditors she didn’t list, she has lost any protection from the bankruptcy court for the debts she owes to her other creditors.

It’s important to contrast this result with In re Padilla, a Colorado bankruptcy court case which held that where there is a no asset case, even debts which are not listed are still discharged. The main difference between these two cases, is that the creditor in Padilla did not argue that the Padillas had fraudulently made omissions on their bankruptcy petition.

What I suggest for people who are concerned about friends or family members finding out is that they get in touch with those people before we file and let them know they can expect a notice in the mail from the bankruptcy court about the bankruptcy. They can still repay those debts, and they have fulfilled their obligation to list all of their debts.

If you have questions about how to deal with your creditors when you file bankruptcy, we hope you’ll come in for a free, no-obligation consultation with an experienced Colorado bankruptcy attorney. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

We are Denver, Colorado bankruptcy attorneys. We help people who have been blindsided by life's unexpected events find their way to financial recovery by expertly guiding them through the bankruptcy process.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

How Do I Know If I Qualify For Chapter 7 Bankruptcy?

Written by Peter Mullison, Colorado Bankruptcy Attorney

How Do I Know If I Qualify For Chapter 7 Bankruptcy

I love the Internet. It is a seemingly bottomless source of information and Google is the first place I stop if I am researching something. That said, I am also one of the most skeptical people my wife has ever met. So I always bounce anything I find on the Internet off of several sources to make sure that what I find is accurate.

Many people who come in to see us for an initial consultation have done some online research about bankruptcy. Some have done just enough to know they need to talk to an attorney to get more information. Others have done more digging and come to the consultation with their own conclusions about what their best course is. Most often it is whether they qualify for Chapter 7 or Chapter 13 bankruptcy.

While determining whether someone qualifies for Chapter 7 is not particularly difficult, it does require a thorough knowledge of the bankruptcy code and will generally not come from skimming a few blog posts or online forums about the subject.

The first step in determining whether someone qualifies for Chapter 7 bankruptcy is to determine their annual household income. This requires looking at all income sources, including that of household members who may not be filing bankruptcy. Also important is that we will be using before tax income, not what someone takes home in their paycheck.

Next, we compare that number to the median income for their household size. Current median income numbers can be found here.

If their household income is below the current median income, then that is usually the end of the calculation. However, if their household income is over the median income, we are going to have to go further. It’s possible for someone whose household income is over the median income to qualify for Chapter 7, but we have to have more information about their household expenses and even their debts.

That’s where the knowledge of an experienced bankruptcy lawyer is needed. An experienced lawyer will scrutinize those expenses and debts to see if there is a way to qualify someone for Chapter 7. Someone with less experience may not know, for example, that if more than 50% of someone’s debts came from a failed business, it doesn’t matter what their household income is and that Chapter 7 is an option for them.

Even if someone does qualify for Chapter 7 bankruptcy, that doesn’t mean that is the best course for them. There are several reasons why someone should file Chapter 13 instead. Again, that is where the advice of an experienced bankruptcy lawyer helps.

If you have questions about whether you qualify to file Chapter 7 bankruptcy, we hope you’ll come in for a free, no-obligation consultation with an experienced Colorado bankruptcy attorney. You can call 303.331.3403 to schedule an appointment or use our online scheduling system.

We are Denver, Colorado bankruptcy attorneys. We help people who have been blindsided by life's unexpected events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

How Bankruptcy Can Improve Your Credit Score

Written by Peter Mullison, Colorado Bankruptcy Attorney

How Bankruptcy Can Improve Your Credit Score

Yesterday I got an email from a former client. She was concerned. She had received her discharge several months ago and decided to check her credit score. It was 674. She didn’t expect it to be that high so soon after filing. She was writing to ask if that was even possible.

I wasn’t surprised. One of the “secrets” of bankruptcy, is how quickly your credit score can improve after you file bankruptcy. Of course, everyone’s experience will vary, but this recovery is common for many people who file.

The reason is fairly simple. Factors that will lower a credit score are delinquent accounts and an upside down debt-to-credit ratio where you have maxed out your available credit. Most people who file bankruptcy have fallen behind on payments to their creditors and have maxed out their credit limits.

Once a person files bankruptcy, their debt-to-credit ratio obviously drops since they no longer have any debt. All of those delinquent accounts will also now reflect that they have been discharged. In effect, your credit report is wiped clean.

Once someone has gotten their discharge order from the bankruptcy court, they can start to rebuild their credit score. I encourage my clients to find a secured credit card. The card should be used for common purchases, such as groceries and gas, that would normally be paid for out of a checking account. The card should be paid off, every month, on time. This activity will be reported positively to the credit bureaus.

I recently had a conversation with a mortgage broker who encourages people who have recently filed bankruptcy, and are hoping to one day buy a home, to acquire at least three lines of credit. Again, though, these don’t need to be for large amounts to help build your credit score. While you want to build that score, you also want to use solid budgeting and money management strategies to take full advantage of the fresh start that bankruptcy provides.

If you have questions about how bankruptcy can improve your credit score, we hope you’ll come in for a free, no-obligation consultation with an experienced Colorado bankruptcy lawyer. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

We are Denver, Colorado bankruptcy lawyers. We help people who have been blindsided by life's unexpected events find their way back to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

November 1, 2014 Colorado Median Income Amounts For Bankruptcy Means Test

Written by Peter Mullison, Colorado Bankruptcy Attorney

Median Income For Colorado November 1 2014

Twice a year the United States Census Bureau updates the median income. Those amounts were once again updated for Colorado on November 1, 2014.

They are as follows:

-Household Size of 1: $51,552

-Household Size of 2: $67,129

-Household Size of 3: $70,827

-Household Size of 4: $84,998

Add $8,100 for each household member in excess of 4.

For bankruptcy purposes, the median income amount is crucial in determining whether someone is either eligible for Chapter 7 bankruptcy. If their income exceeds the median income, and they have to file Chapter 13 bankruptcy, the median income amount will determine how much they’ll have to repay their creditors over the course of their Chapter 13 plan.

It’s important to keep in mind, however, that even if someone is over the median income, they may still be eligible for Chapter 7. An experienced bankruptcy attorney’s knowledge of the means test (used to determine Chapter 7 eligibility) can make the difference between getting your fresh start from bankruptcy in four months or having to repay a portion of your debt in a Chapter 13 bankruptcy over the course of three to five years.

If you have questions about bankruptcy, including whether your income qualifies you for Chapter 7 or Chapter 13 bankruptcy, we hope you’ll come in for a free, no obligation consultation with an experienced Colorado bankruptcy lawyer. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

Photo credit: Lending Memo

We are Denver, Colorado bankruptcy lawyers. We help people who have been blindsided by life's events find their way back to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

Can A Creditor Force Me To Appear At A Bankruptcy Rule 2004 Examination?

Written by Peter Mullison, Colorado Bankruptcy Attorney

US Marshal

If you’ve filed bankruptcy, or have been doing some research as you consider filing, you have probably ready about the meeting of creditors (also called the 341 meeting, after the Bankruptcy Code section that requires it). At that meeting creditors can appear and ask questions about your petition and financial state of affairs. However, if a creditor wants to ask more detailed questions, it can ask the court to allow it to conduct a Rule 2004 examination by filing a motion.

If the debtor is in a cooperative mood, he or she will appear at an agreed upon time and place. If the creditor is not confident that the debtor will appear, it will issue a subpoena for the debtor’s appearance. Failure to appear as required by the subpoena could result in sanctions.

If the debtor still refuses to appear, the creditor can resort to the relief provided in Rule 2005 of the Federal Rules of Bankruptcy Procedure. Rule 2005 allows the creditor to ask the court for an order to compel a debtor’s attendance. Such an order is given to the US Marshal to enforce. The marshal will bring the debtor before the court to answer the creditor’s questions.

The better course is probably to just meet with the creditor at a time and place you both agree to and get the questions out of the way and done with. Unfortunately, a creditor has a great deal of latitude to ask questions about a debtor’s finances, making objections difficult, if not pointless.

If you have received a subpoena to appear at a Rule 2004 exam, you should contact your bankruptcy attorney right away. If you don’t have an attorney, or your current attorney excludes appearing at a Rule 2004 exam in your representation agreement, give us a call. You can call 303.331.3403 to talk to an experienced Colorado bankruptcy attorney.

We are Denver, Colorado bankruptcy lawyers. We help people who have been blindsided by life's events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

Can I Hire An Attorney After I File My Chapter 13 Bankruptcy Myself?

Written by Peter Mullison, Colorado Bankruptcy Attorney

We Can Help With Your Chapter 13 Bankruptcy, Even If You Filed It Yourself

We Can Help With Your Chapter 13 Bankruptcy, Even If You Filed It Yourself

If you talk to some lawyers, they will absolutely advocate against someone filing their own bankruptcy petition. But the fact is, about 10 %- 15% of people who file Chapter 7 do so without an attorney and most do it successfully. I don’t have a problem with someone filing their own Chapter 7, but I do get concerned when someone tries to manage their own Chapter 13 bankruptcy.

Chapter 13 bankruptcy is a whole other animal. There are more reporting requirements, and crafting a repayment plan that will be accepted by the creditors, trustee, and court takes knowledge of the Bankruptcy Code, forms, and local procedures. Chapter 7 trustees are used to dealing with pro se filers and for the most part are patient in working with them. Chapter 13 trustees seem to be less patient in dealing with people who file without an attorney.

We get a call or two every month from someone who has filed a Chapter 13 without an attorney. We usually invite them and ask them to bring everything they’ve filed with the court and all correspondence they’ve gotten. We can also look their case up online to see where the case is procedurally. Without fail, we’ll see forms and schedules that have been inaccurately completed. We’ll look at any objections to the repayment plan that have been fail (and there is always at least one). It’s usually after the objections have been filed that someone will call us, looking for help.

Fortunately, we can help. After we review the petition, plan, and all of the client’s supporting documents to make sure there are no discrepancies with the petition, we’ll enter an appearance. From there on out, we’ll take control of the case. We’ll update and amend the schedules and review the plan to address any objections that have been filed and make sure that the minimum allowable payment is provided for.

Our job is to guide our clients through the bankruptcy process to make sure they get through it safely. That’s our objective whether they come to use from the beginning or after they’ve tried to manage their own bankruptcy.

If you need help with your Chapter 13 bankruptcy, we hope you’ll give us a call for a free consultation with an experienced Colorado bankruptcy lawyer. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

We are Denver, Colorado bankruptcy lawyers. We help people who have been blindsided by life's unexpected events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

How Long Do Creditors Have To File A Proof Of Claim?

Written by Peter Mullison, Colorado Bankruptcy Attorney

Deadline To File Proof Of Claim In Bankruptcy

If you file Chapter 13 bankruptcy or have any non-exempt assets that the trustee can liquidate in a Chapter 7 bankruptcy, your creditors will receive a notice that they need to file a proof of claim if they want to be paid. The claim must show the basis of your debt and how much you owe. The deadline to file a proof of claim is 90 days after your creditors meeting. If a creditor fails to meet the deadline, it may be prohibited from receiving anything.

Most filers, especially in a Chapter 7 bankruptcy, won’t be concerned about whether or when a creditor files a claim. If you’ve hired an attorney, he or she should be monitoring the filed claims. However, in certain cases you want to make sure that a claim has been made on time. For example, if you owe back taxes those must be repaid over the course of your Chapter 13 repayment plan. But if a claim isn’t made, the trustee won’t make any payments. This can end up derailing your bankruptcy. The same is true if you owe arrears on your home mortgage. Also, in some cases a Chapter 13 filer may be required to pay 100% of all timely filed claims. If an unsecured credit files a late claim, your attorney will likely want to file a motion to disallow the claim to avoid you having to pay more than you should.

If you have questions about the bankruptcy process, we hope you’ll give us a call or come in for a free, no-obligation consultation with an experienced Colorado bankruptcy attorney. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.

We are Denver, Colorado bankruptcy attorneys. We help people who have been blindsided by life's unexpected events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

Do I Have To List Gifts I Got From Other People When I File Bankruptcy?

Written by Peter Mullison, Colorado Bankruptcy Attorney

Do I Have To List Gifts From Others

After we meet with someone for an initial consultation, we give them a worksheet that asks them to list all of their assets, income, debts, and expenses. Although the worksheet doesn’t get submitted to the bankruptcy court, it  is the foundation of the bankruptcy petition. We emphasize that the need to answer all of the questions and disclose everything we ask for.

Understandably, people get concerned that something they disclose can get them in trouble with the court or their creditors. Our job is to make sure our clients get through the bankruptcy process as easily as possible. We can only help if we understand their financial situation completely. Once we know everything we can determine if the client should anticipate anything out of the ordinary. Most times there isn’t.

Even after these assurances, some clients try to avoid disclosing some information. One of the more common ways they do this is by arguing that a personal belonging isn’t really theirs, because it was a gift. Even gifts to you from another person have to be disclosed. At the time the gift was made the other person transferred their right to the gift to you. You are now the owner of the gift, and we have to disclose any personal belonging that you have an ownership interest in.

Keep in mind that most people who file bankruptcy are able to keep all of their personal belongings. Our job is to help you through the process and ensuring that you keep those items. If you own any items that are not protected under bankruptcy law, we will talk about what options you have.

If you have questions about navigating the bankruptcy process and whether it might be a good option for you, we hope you’ll come in for a free consultation with an experienced Colorado bankruptcy lawyer. You can make an appointment by calling 303.331.3403 or by using our online scheduling system.

We are Denver, Colorado bankruptcy lawyers. We help people who have been blindsided by life's unexpected events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290

Can I Reopen My Bankruptcy Case After It Has Been Closed?

Written by Peter Mullison, Colorado Bankruptcy Attorney

Can I Reopen My Bankruptcy CaseFrom time to time we get calls from people who have already filed a bankruptcy case, usually a Chapter 7 case, that the bankruptcy court has closed.

For one reason or another, they want to know if the case can be reopened. Sometimes it’s because they have forgotten to file the certificate of completion for their required financial management class. Other times it’s because they didn’t realize that a creditor had placed a judgment lien against their home. Usually they are in the process of selling or refinancing their home and the title company discovers the lien. They want to know if they can reopen their case and get rid of the lien.

Fortunately, section 350(b) of the Bankruptcy Code allows the court to reopen a case to ” to administer assets, to accord relief to the debtor, or for other cause.” What this means is that, yes, you can ask the court to reopen your case in some instances, including removing a lien that you or your attorney missed during the course of your bankruptcy.

You or your attorney will have to file a motion to ask the court to reopen your case. Assuming the court grants your motion, which it should, you’ll then be able to seek the relief you need, i.e. ask the court to remove the judgment lien.

If you haven’t yet filed your bankruptcy, you should know that a thorough bankruptcy lawyer will do a title search to see if there are any liens against your property and make sure to take care of it while your case is open.

If you have questions about a previous bankruptcy, we hope you’ll contact us to see if we can help. You can call 303.331.3403 to talk to an experienced Colorado bankruptcy attorney.

We are Denver, Colorado bankruptcy attorneys. We help people who have been blindsided by life's events find their way to financial recovery.
3773 Cherry Creek Drive North, Suite 575
Denver, CO
80209
US
Phone: 303.331.3403
Fax: 303.261.8290