Dischargeability of Student Loans The American Bankruptcy Institute recently released their final report on consumer bankruptcy. This report took place from 2017-2019 and analyzed dozens of issues as they relate to Chapter seven and Chapter 13 bankruptcy. The first issue that I would like to address is the non-dischargeability in general of student loans. As the law currently stands, student loans or any loans for an educational purpose are deemed to be non-dischargeable.  This is the case unless a debtor can successfully bring an adversarial complaint proving that the student loan imposes an undue hardship on the debtor and thus should be dischargeable. Because those + Click Here For Read More

As the new year has begun, it is time to look at the bankruptcy filing statistics from the first part of 2019 as compared to the first part of 2018. This fact will dictate where we may be heading for the rest of 2019. As expected, total bankruptcy filings in January 2019 increased 5 percent from January 2018’s total of 54,650 filings. Importantly to consumer bankruptcy attorneys as well as to the general public, consumer filings increased 6 percent in January 2019 to 54,711 from the January 2018 consumer filing total of 51,758. Although we see a significant increase by way of percentage, this actually shows that lending has loosened up and people are gainfully employed to a + Click Here For Read More

When: Effective January 1st, there is new help for Chapter 7 debtors who owe money to the City of Chicago for  parking tickets and related fines.  A new Ordinance, sponsored by Mayor Emanuel provides in part that: Payment Plan: An eligible bankruptcy debtor may establish a payment plan to repay fines that were incurred within three years of the Chapter 7 bankruptcy filing.  These fines will be reduced to the principal only and can be paid over a series of 6-12 months. Waiver of Fines & Penalites: If the debtor completes the payment plan and receives a discharge in bankruptcy, the City of Chicago will waive any fines, penalties and fees that were incurred more than three years prior + Click Here For Read More

Taxes, Refunds & Dismissals During the past several years, there has been a huge increase in Chicago trustees under Chapter 13 demanding taxes and refunds of the debtors. The bankruptcy code requires that a debtor provide to the trustee, annually, a copy of his or her tax return. This statutory requirement was primarily to ensure that a debtor being afforded protection under Chapter 13 of the bankruptcy code concurrently complied with federal tax law. Surprisingly, most debtors proved to be in compliance and simply provided a copy of the return when requested by the trustee. However, as time passed, this simple turnover of the proof of return didn't satisfy the trustees. When reviewing + Click Here For Read More

Initial Facts This is a bankruptcy case study for Ms. F. who resides in Aurora, Illinois. She is in the office to determine whether or not she can qualify for chapter 7, the fresh start bankruptcy. Otherwise, she is potentially interested in a chapter 13 bankruptcy case which is a reorganization of debts. Let's look at the facts of the case. She is a homeowner with a market value of $158,000. She is current on her first mortgage with Everbank and the outstanding balance totals $124,000. When we calculate in her homestead exemption of 15,000, costs of sale, and associated fees for transferring real estate, there does not seem to be significant equity in the property. For this reason, chapter + Click Here For Read More

If you are gainfully employed, the payment will most likely come directly from your wages in the form of a payroll control order. If you are self-employed or do not receive a regular pay check, then you will have to make the payment directly to the Chapter 13 Trustee. If you fall behind on your payments, the Trustee or a creditor can bring a motion to dismiss your case. + Click Here For Read More

Chapter 7 or Chapter 13 For consumers who are thinking about filing for bankruptcy, the advice of which chapter to file from an attorney is the most critical piece of information right from the start. The difference between Chapter 7 and Chapter 13 is significant. Chapter 7 is known as a fresh start which allows for the elimination of miscellaneous, unsecured debt such as credit cards, medical bills, personal loans, utility bills and debts for other types of services. The case typically lasts no longer than four months and most debt will be eliminated with the exception of student loans, parking tickets, recent taxes, child support, maintenance, and other nondischargeable debt. Chapter 13, + Click Here For Read More

While it is possible to change bankruptcy attorneys in the middle of the case, it often will not make a difference in the outcome of the case. The relationship between a client and a bankruptcy attorney is one of trust, confidence, respect, diligence and communication. If there is a breakdown in any one or more of these areas, then it may be wise to make a change as to attorney. However, clients often want to make a change because they are seeking either alternative advice or a different result. In these cases, it may make sense to stick with the attorney that you hired originally. In recent chapter 13 case which was confirmed and well underway for the past two or three years, the thought + Click Here For Read More

New Rules To Recover Impounded Vehicles In recent months, there has been a tidal wave of activity surrounding bankruptcy, the City of Chicago, parking tickets and consumers trying to recover their impounded vehicles. For many years, it was common practice for the City of Chicago to release vehicles back to a debtor upon the filing of a chapter 13 bankruptcy. This was done in most cases as a legitimate way to recover collateral while also proposing a repayment plan for a portion of the parking ticket debt. Some of these cases actually made it through to completion of the plan while others died either a slow death or a quick death. Unfortunately, the system was abused by many individuals, pro + Click Here For Read More

You should complete your Chapter 13 bankruptcy case before you apply for new credit. You should wait the 3-5 years while the case is running since you are holding off your current creditors. In some cases, a vehicle can be purchased and financed after filing, provided a proper motion is brought before the court which gains the approval of the court. Some lenders will contact Chapter 13 debtors for credit opportunities despite the general rule that it should not be done. + Click Here For Read More