Archives for February 2016

Confirmation Of A Chapter 13 Plan: The Liquidation Test

When a chapter 13 case is up for confirmation, the court, the trustee and the debtor must comply with section 1129 of 11 U.S.C.  This section deals with confirmation of a plan and it lists all the different factors that must be complied with for the court to sign an order confirming the plan. Most debtors and their counsel are aware of the requirements for filing a Chapter 13 in general. Those include completing a credit counseling session prior to filing, submitting the most recent four years of federal tax returns to the trustee, providing the most recent two months prior to filing of pay advices and any subsequent amendments or documentation that the trustee requires post-filing. What is + Read More

Chapter 13 Filing With Limited Debts

When Chapter 13 Makes Sense There are certain circumstances where chapter 13 makes perfect sense even though there may not be a lot of debt being repaid. A perfect example of this would be if a person's driver's license is suspended due to failure to pay parking tickets to the City of Chicago. Let's say this person needs that vehicle to get to and from work. If the debtor's license is suspended, chapter 13 is going to be the only option to regain driving privileges other than working into an installment payment plan with the City of Chicago. Often times, the city will not be amenable to a payment plan and the debtor is forced to either borrow a significant sum of money from family and + Read More

Is My Chapter 13 Bankruptcy Case On The Verge Of Dismissal?

Chance For Dismissal This is a question that comes up on nearly every chapter 13 bankruptcy case that is filed. It is almost impossible to make it through the chapter 13 filing process without some sort of difficulty. The difficulty might stem from the trustee, a creditor, the regulations, or the debtor himself. There are certain situations where a case cannot be confirmed by the trustee because the debtor has not satisfied the requirements of a confirmable plan. This could be based on the debtor's inability to substantiate specific expenses, provide documentation for certain debts, or from the debtor's inability to comply with the law. A debtor often will find motions to dismiss filed by + Read More

When Bankruptcy Is Not Enough: Be Careful When Investing In Suspect Real Estate

Invest Wisely I have to share with you a cautionary tale of a prior client who had an investment in a real estate property on the South side of Chicago. The neighborhood in which he invested was not great.  In fact, it's one of the two or three neighborhoods in Chicago that has not seen any form of significant re-gentrification. He purchased the property which had a single family home on it with the intent of renting it out and receiving passive income. When he was unable to do so effectively, he decided to include it in his chapter 7 bankruptcy along with other debts that he wished to eliminate. The underlying debt to the mortgage company was eliminated. However, my former client still + Read More

How Soon Will I Get Credit After Filing Bankruptcy?

It's amazing to me that people are worried about getting credit before they even completed a bankruptcy case. This is due in fact based upon Americans desire and obsession for credit. After all, credit is what more than likely got the person into financial problems to begin with. Now there are other causes of bankruptcy filings such as medical bills, job loss, illness, divorce, but the main reason why people fall into bankruptcy is due to credit. Credit Score It seems that everyone is obsessed with credit and their credit scores. People want to know how is bankruptcy going to affect my credit score? I have to look at these potential clients in bewilderment. Why on earth are they asking me + Read More

Some Judges Making It Difficult For Bankruptcy Attorneys To Get Their Fees Ordered

Problems Getting Paid In The Past Over the past 20 years, I have been searching for the reason or reasons why bankruptcy judges make it so difficult for bankruptcy attorneys to get paid in Chapter 13 consumer bankruptcy cases. This goes all the way back to the early 1990’s when some judges would simply not sign the order. Perhaps the judges had too much work on their docket. Others created additional work by not granting the fees in a timely manner and instead put the applications on the back burner where they often remained lost. In the 2000's, we argued with the presiding bankruptcy judge to order our fees when the motion was first up to be heard with the original confirmation hearing. + Read More