Effective February 19, 2020, the Bankruptcy Code will provide for a somewhat more compact and hopefully, easier version of Chapter 11 Reorganizations for Small Business Corporate and Individual Debtors. It is commonly referred to as a “Subchapter 5.”

It can be quite disheartening to listen to political leaders, the media and other reports as to how well the economy has rebounded since 2008, with record employment and sky-high stock numbers – yet at the same time realize you are living from paycheck to paycheck and things have never been tighter for you and your family.

In this firm, we pride ourselves on providing prospective debtors a fair and honest evaluation of the benefits and detriments of filing for Bankruptcy Protection. Most often, I encourage individuals to utilize bankruptcy when there is “no viable alternative that will result in the elimination of the debt over a finite and reasonable period of time at an affordable figure
per month."

A ritual of spring in America is about to begin. Tens of thousands of people will soon get their tax refunds, and when they do, they will finally be able to afford the thing they’ve thought about for months, if not years: bankruptcy.

As a consumer Bankruptcy attorney, I cannot recount how many times over my career I have heard these words, even though the need for Bankruptcy relief is compelling – if not overwhelming.

Ipso facto literally means "by that very fact" in Latin. It is an extremely important concept in Bankruptcy which if not recognized and enforced, could undermine the very protection of Bankruptcy itself.

Certainly a visit to a bankruptcy attorney would rank up there with one of the least anticipated appointments on a calendar.  However, like many type of medical visits, needless delay can be extremely costly or worse to the bankruptcy process.  As I say so often, it rarely gets better with time. 

The author of the expression that “nothing is certain but death and taxes” never spoke to a bankruptcy lawyer.  Contrary to what many think, taxes under certain circumstances can be discharged and eliminated in a bankruptcy filing.

This season brings out the best - and regrettably sometimes the worst in individuals. For example, in the effort to "enjoy the season" we often go overboard and spend well beyond our means which can create havoc just a few short months from now.

A Presidential election may have more impact on one’s daily life than you might guess. Look no farther than the 2004 Presidential election which returned George W. Bush to the White House with a sufficient Republican majority to pass through the 2005 Bankruptcy “Reform” Legislation which had been vetoed (pocket vetoed to be exact) by President Clinton in 1998 and stalled by the Democrats in the Senate during President Bush’s first term.

Why would someone voluntarily agree to repay a debt just discharged in Bankruptcy? Isn’t bankruptcy designed to eliminate debts? This concept of reaffirmation of debts, as permitted by 11 U.S.C. §524 (c) of the Bankruptcy Code has become one of the more vexing issues faced by bankruptcy counsel and debtors.

2+2 may not always equal 4. 

Depending on the type of plan, events may transpire post petition which could increase the amount necessary to satisfy the Chapter 13 obligations.  There may be additional administrative claims (for legal fees on application to the Court) or post petition creditor claims which could increase the amount necessary to fund the plan.

13 Myths About Chapter 13 Bankruptcy

So much is written and put out on the internet about the “Individual Repayment” option contained in the Bankruptcy Code under Chapter 13 that it probably is not surprising that much of it is either skewed for one reason or another - or is outright misinformation. This article includes some of the fairly constant refrains we as bankruptcy lawyers hear from clients to explain their hesitancy to consider Chapter 13. It is further an attempt to clarify and/or reassure individuals who may be considering Chapter 13 or desperately need its enhanced protections under the Bankruptcy Code.

Most people have heard of the basic Chapters of Bankruptcy filing; Chapter 7, 11 or 13.   Some are even aware of the less used provisions of Chapter 12 (for farmers or fishermen) or Chapter 9 (municipal entities) or even of late Chapter 15 (for foreign corporations).  But a hybrid approach called "Chapter 20" is getting a lot more attention.

The notions of filing for Bankruptcy and enjoying the holidays are not as foreign as one might think. Most people will try to forget their financial issues around this time of the year, but the financial stress can never be far from the surface. Creditors do not go on holiday. One of the primary goals of a bankruptcy filing is to restore some financial sanity to people's existence - so that they can enjoy the rest of their lives.

The ability to create a plan of action which deals with the overwhelming burden of out of control debt is itself a form of relief. Long before the actual bankruptcy petition is filed with the Court, our office will tell clients to refer creditor and collection calls to us so that we can inform them of the pending Bankruptcy filing, and with it the imposition of the federally mandated automatic stay which stops everything in its place. Even though there may not be a legal bar for collection (although harassment is always prohibited under law), most creditor are not terribly interested in pursuing individuals about to file Bankruptcy. It is not in their financial interests to do so.