King Law Offices ~ Catherine King, Esq.

OVERVIEW OF CHAPTER 7 AND 13

CHAPTER 7 is a "liquidation" bankruptcy which allows all of your debts to be wiped away.  You retain certain assets which are "exempt" or not included and the remaining assets (if any) are applied towards retiring the liabilities.

CHAPTER 13 is a "wage earners" bankruptcy where a plan is established allowing you to repay some or all of your outstanding debt over a period of time (usually 3-5 years) while staying current on your other obligations. 

In both cases, upon filing a petition you receive an "automatic stay" preventing collectors from pursuing you for your debts typically for the duration of the bankruptcy.  That means that during the bankruptcy your lender may not foreclose against you and creditors may not call or sue you to collect the debts.  Contact by your creditors may be a violation that we can pursue to obtain money damages.   

BASIC REQUIREMENTS TO FILE BANKRUPTCY

a)   Petition, Schedules and Statement of Financial Affairs – The initial pleading provide the trustee and creditors with a financial snapshot of the debtor as of the date of filing. These papers describe the your assets, liabilities, monthly income and monthly expenses.

b)   Must File Last Four Tax Returns – A new requirement under BAPCA is that the debtor must be current with federal income tax filings for at least the last four years. A copy of the last years tax returns must be submitted directly to the trustee. Don't worry if you cannot find your returns for the last four years.  We can order tax transcripts directly from the IRS.

c)   Credit Counseling – A new Provision under BAPCA (bankruptcy laws) requires that a debtor receive credit counseling within the six month period prior to filing a bankruptcy petition. The credit counseling agency must be approved by the U.S. Trustee’s Office. The certificate of credit counseling is filed simultaneously with the bankruptcy petition. The cost for credit counseling is approximately $50 per person ($100 per couple), although our office has a relationship with an approved credit counseling agency that is free to you! 

d)   Debtor Education – Prior to receiving a discharge in bankruptcy but after the case is filed, debtors must complete a debtor education program. The debtor education provider must be approved by the U.S. Trustee’s Office. The certificate of completion is filed with the bankruptcy court. The cost for the approved program is approximately $50 per person ($75 per couple). 

There are lawyers who will tell you not to worry about the phone calls, letters and credit report hits. They will tell you that it will all stop eventually. Some lawyers will advice you to send a copy of the bankruptcy papers in order for the madness to stop, while your stress continues and your time is wasted.

The Truth is creditors and collection agencies can be forced to pay damages, under the law.  These collection agencies will also attempt to use your credit report as collateral in an attempt to try and continue to collect.  This too is illegal. Bill collectors have no excuse and these simple acts by collection agencies will have dire effects on you in many ways.

- keeping you credit score low
- reducing chances of qualifying for a new home, car, or credit cards
- possible job opportunities lost
- increase in auto insurance

We are lawyers who sues bill collectors when they break the law. We can help you stop their tricks and make them pay you for their mistakes.

Do not allow bill collectors to break the law and prevent you from a fresh financial start. We can help! 

We use the bankruptcy code to stop foreclosures, garnishments, repossessions and reducing debt while helping you to regain financial control.
 
WHY SHOULD I FIGHT MY FORECLOSURE?
 
If you have been served with a Notice of Default and/or Notice of Trustee's Sale to foreclose on your home, your options are limited.  First, you can negotiate with your mortgage company to reinstate the mortgage.  Secondly, you can file a Chapter 13 bankruptcy.  Thirdly, you can sell your home or attempt to refinance.  Fourthly, you can give up and get out of your home.  Finally, you can fight the foreclosure.

The first two options assume that you can afford your current monthly payment, and selling  or refinacing your home may be impossible if you have little equity or even negative equity.

Many homeowners, especially those with subprime mortgages, can no longer afford the mortgage payments, even if the mortgage were current.  That makes a Chapter 13 bankruptcy impossible.  Even if you  are behind on your payments, and cannot afford the current monthly payment, you should contact KING LAW OFFICES to fight the foreclosure.

While you are litigating the foreclosure case, you are not required to make your normal monthly mortgage payments.  The legal process will afford you time to reinstate the mortgage, sell your home, file a bankruptcy or move out.  You may even be able to force the lender to completely rewrite the terms of your note and mortgage, enabling you to keep your home.

This may sound too good to be true, but you may actually have valuable defenses and counterclaims against your mortgage company that could actually prevent foreclosure and even require your lender to pay you damages.  Across the country, judges are holding mortgage companies to account for incomplete record keeping and for violations of the Truth In Lending Act.  You may be able to allege valid claims including fraud and Truth In Lending Act violations.

Did you know that your mortgage company is probably not the same company that actually loaned you the money to refinance your home?  How do you know if the mortgage company suing you has been properly assigned your note and mortgage?  Your mortgage company may have failed to properly assign the note and mortgage before initiating the foreclosure. 
 
Most likely, these documents may not even be in the possession of your mortgage company.  Your mortgage company may be attempting to substitute your original note and/or mortgage with a copy.  This is called an "Affidavit t to Establish Lost Documents."  However, there are strict legal requirements to establish a lost note or mortgage, and your mortgage company may not be able to meet the requirements if  challenged. Please visit www.keepingyourhomeyours.com  for more information.