Free ebooks
Monster Traffic
 Monster eBay Tips
 Monster eBooks
 Monster Promotion
 Monster Money
 Home


Money & Employment -> Debt


Featured Products
> Go Back

Search here for more results

Featured Article

Use and distribution of this article is subject to our Publisher Guidelines whereby the original author's information and copyright must be included.


Bankruptcy-- What it can and

can't accomplish  

by Joe L.Golson


The following is an outline of select areas of bankruptcy law which are significant as you contemplate a filing under Chapter 7. Often, someone who considers bankruptcy is unaware of the nuances of bankruptcy or certain creditors' rights in bankruptcy. You should be familiar with some of the applicable provisions as you prepare for filing. What follows is not, by any means, an exhaustive review of bankruptcy law; nor does it fully explain each provision of the bankruptcy code or rules which might apply because each individual's situation is unique and sometimes unanticipated events occur; however, this overview will provide you with broad guidelines so that you may be comfortable with your decision. I will begin with an outline of basic procedures in Chapter 7 case and conclude with a discussion of various Chapter 7 pitfalls.

Basic Procedure
A. Upon filing, you will be required to file a sworn list of creditors, a schedule of assets and liabilities, a list of exempt property, a schedule of current income and expenditures, a statement of your financial affairs and a statement of intent regarding consumer debts secured by property of the estate. You will also be required to surrender to the trustee all property of the estate. 11 U.S.C. 521. The order of relief is granted when you file. What this means, among other things, is that an automatic stay is triggered, prohibiting creditors from pursuing you or your property
outside of the bankruptcy proceeding.

B. The clerk of court will give notice of the bankruptcy to your creditors. 11 U.S.C. 342.

C. There will be a meeting of creditors called to question you about your debts and ability to pay. The U.S. Trustee calls this meeting and you are required to attend. The judge may not question you at this time. Other creditors and the trustee may question you. Unlike a trial, your attorney may not "object" to questions in a formal sense. It is an open opportunity for creditors to question you and you are required to respond in good faith. 11 U.S.C. 341.

D. A creditor of the trustee assigned to your case may object to your listed exemptions within 30 days after the meeting of creditors.

E. A creditor must file a proof of claim within 90 days after the first date set for the meeting of creditors. At the end of the case, if a surplus remains after all of the claims are paid in full, the court may grant an extension of time for filing of claims not filed during the initial 90 day period.

The trustee may object to any claim.

F. An objection to your receiving a general discharge of all of your debts must be filed by thetrustee or a creditor within 60 days following the first date set for the creditors meeting If no objections are filed, and if no motion to dismiss is pending, the court will ordinarily grant a discharge upon expiration of the 60 day period. Bankruptcy Rules 4004 and 1017; 11 U.S.C. 727.

G. A creditor may object to the dischargeability of a particular debt at any time if the debt: (1) is for a tax or customs duty; (2) is not listed in the schedules so that a creditor could file a proof of claim; (3) is related to alimony or child support; (4) is a government fine or penalty; or (4) is a
government insured student loan. Any student loans guaranteed or insured by the government will not be dischargeable. This means that you will continue to be liable for the payment even if you file bankruptcy.

A creditor may object to the dischargeability of a particular debt only within 60 days of the first date set for the meeting of creditors, if the debt: (1) is a consumer debt created close to filing; (2) is a result of fraud; (3) is a result of a wilful and malicious injury to a person or property of another. Bankruptcy Rule 4007; 11 U.S.C. 523.

Debtor Pitfalls
The debtor's goal in any Chapter 7 is to have as many debts discharged as possible. The general rule is that all debts created before the bankruptcy filing are discharged. Discharge destroys any person liability you may have on a claim or debt. (Discharge will not destroy liens; liens survive the bankruptcy.)

There are some very significant exceptions to the general rule that all debts will be discharged. As stated above, a creditor can try to have his claim excepted from discharge pursuant to the provisions of 11 U.S.C. 523. If the claim is not discharged, the debtor continues to be responsible for its payment; obviously, this could have severe consequences to the debtor seeking a "fresh start" which is the very purpose of the Chapter 7 filing.

There are ten categories of debt excluded from discharge under 523. These fall into two areas: debts that are not dischargeable due to the wrongful conduct of the debtor and debts that are not dischargeable due to public policy.

The debts not dischargeable due to the debtor's misconduct include those created by intentional torts, fraud, larceny, embezzlement, fiduciary violations, and drunken driving. The debts not dischargeable due to public policy include alimony and child support, taxes and customs duties, governmental fines, penalties and forfeitures, educational loans, unscheduled debts and certain debts surviving a prior bankruptcy case. A claim must fall within one of these exceptions to be
found non-dischargeable.

To prevail on a fraud exception, the creditor would need to show that there was a false, material representation of fact made by the debtor that the debtor knew was false at the time he made it, made with the intention of deceiving the creditor. Some courts have held that when a credit card is used, the debtor impliedly represents that the debtor has the ability and intention to pay for the goods and services charged. Those courts have therefore found that some credit card debt is
non-dischargeable under the fraud exception.

This is not the only potential problem that can arise with credit card or similar debt. 523 also provides that there is a presumption that certain consumer debt created right before filing a Chapter 7 is non-dischargeable. The presumption of non-dischargeability will apply if the debt is a consumer debt for so-called "luxury goods or services" incurred or within 40 days before the filing, owing to a single creditor aggregating more than $500. Further, the presumption of
non-dischargeability will apply if there are cash advances made by a creditor for more than $1000 that are extensions of consumer credit under an open end credit plan within 20 days of filing bankruptcy.

Luxury goods and services are not defined by the Bankruptcy Code and the determination of same will be contingent upon the facts and circumstances of each case. I can tell you that courts have characterized such items as a person computer, coffee maker, floral arrangements and three-wheel recreational vehicle as "luxury" items.

Any credit extended based on false financial statements is subject to exception from discharge. Statements made in the financial statements have to be materially false with the intent to deceive the creditor to fall within this exception. Note that a credit application should not qualify as a "financial statement" if it does not require a disclosure of debts.

It is crucial for the debtor to include all creditors in his schedules filed with the court. If a debtor knows of the creditor and does not schedule him, the creditor is denied participation in any distribution; to protect the creditor from this type of problem, the code provides that unscheduled claims may be non-dischargeable.

Debts created by willful and malicious injury will also be excepted from discharge. These types of claims arise from intentional actions by the debtor, done with malice which causes damage. It is important to note that ordinary negligence claims are dischargeable. A plaintiff with a personal injury claim would need to allege significantly more than simple negligence to have his or her claim deemed non-dischargeable in the bankruptcy court.

Dismissal may also be justified if the debtor is an individual who has primarily consumer debt and the court finds that the granting of relief would be a substantial abuse of the bankruptcy process. Substantial abuse has been found by courts if the debtor is actually able to pay his debts when due
Receive a valuable ebook package worth $197 US
For Free!

Name:
Email:


Your email will never be sold !

Featured Article

Use and distribution of this article is subject to our Publisher Guidelines whereby the original author's information and copyright must be included.


Debt consolidation mortgage:

 ‘home solutions’ for integrating arrears  

by Ann Gibson


Credit card debts, auto loans debts, secured loans debts, unsecured loans debts – debts of all sorts and types registered against your name. It is hardly a very promising situation. Debt is an obligation from which you can’t turn away. It is obviously not something you aspired for. But it is surely something with which you have contemplated an annulment. If you can’t decide on the procedure consolidation is the word for you. ‘Consolidation’ – if you check the dictionary means ‘the act of combining into an integral whole’. This is exactly what debt consolidation connotes. Debt consolidation is the act of combining multiple loans into individual, integral loan.


Debt consolidation mortgage not only consolidates your various loans it also consolidates various benefits under one singular name. The name you know is debt consolidation mortgage. There are many things integrated under debt consolidation. It is like an assortment of various payoffs. That certainly does not mean that your debt is paid off. It simply implies that the benefits with debt consolidation mortgage are immense. Debt consolidation that is provided against the security of your home or property is christened as debt consolidation mortgage.

All kind of loan – educational loans, auto loans, secured loans, unsecured loans, personal loans and any kind of loans – can be consolidated under debt consolidation mortgage. It is highly appropriate to adopt debt consolidation mortgage if you have numerous debts. However, a prudent step will be to understand debt consolidation if you actually want to apply for it. Debt consolidation mortgage has the capability to be turned in a way so as to allow maximum monetary benefits. Yet, one little error with debt consolidation mortgage and your situation will be back to square one. That means your debt consolidation mortgage plan will fail to fulfill the function it has been postulated for. Further debt consolidation mortgage has an additional attachment which is like your own home that you have placed as a guarantee. In case of error, you are predisposed to lose your property which is under no circumstances an option to be considered.

With debt consolidation mortgage there is no one single simple stat rule for every homeowner. Debt consolidation mortgage plan is formulated in accordance to your particular financial requirements and status. Interest rates have been low for quite some time. It has been more than publicized on every debt consolidation mortgage advertisement. This can undoubtedly tempt you to take on debt consolidation mortgage. But you need a few initial lessons on debt consolidation mortgage. The most important lesson in debt consolidation mortgage is that debt consolidation is not a credit cure but a credit relief. Under no circumstances can debt consolidation mortgage plan make your various debts evaporate without a trace. The debts are very much there. Debt consolidation mortgage fuses the ramified debts in such a manner that the interest rates on the various debts are diminished significantly.

Debt consolidation mortgage has also become synonymous with convenience. Instead of paying monthly installments to different lenders at different point of time in a month you take one single loan and make payments on that loan. It is crucial to understand that the new interest rate that you are paying should be lower than the interest rate that you have paying separately. Debt consolidation mortgage also has such debt consolidation counseling and debt consolidation credit management. Debt consolidation facts vary from person to person therefore taking advice for debt consolidation mortgage is a must.

According to the latest annual report from the APACS nearly two thirds of adults have a credit card and multiple card holding is a growing phenomenon in the UK. More than six in ten card holders held more than one card in 2004, with one in ten holding at least five. With such statistical reports debt consolidation mortgage has become mandatory in the changing trends.

An average UK family has 13 payment cards including credit cards, debt card and store cards. Although the statistics vary it is estimated that an average family has about 8,500 in credit card debt. Astounding! That is the one word that comes to my mind. If one were to make minimum payments it would still take about 30 years to pay off the debt with an additional amount in the form of interest. There is no doubt that above 40% of families are spending more than they earn. With such a statistics it is self evident that the number of bankruptcies is increasing. According to Department of Trade and Industry, bankruptcies are still on the rise in UK. Bankruptcy is not what you ever had in your mind. Then what is that you have in mind to overcome financial obligation. Do I hear that? If that is what you want then take debt consolidation mortgage.

About the Author

As a financial consultant the only driving force of Ann Gibson is to provide proper knowledge. Because knowledge in respect to loan borrowing is power and exudes financial benefits.He works for uk debt consolidation web site http://www.ukdebtconsolidations.co.uk.To find a uk debt consolidation loan,debt management that best suits your need please visit http://www.ukdebtconsolidations.co.uk.


 
Copyright © 2004 Monster-ebook-sale.com - Design by Just Web Templates