Democratic Rep. John Conyers Jr. of Michigan and Republican Rep. Lamar Smith of Texas sent Washington a proposal to change the bankruptcy law so that businesses seeking bankruptcy protection must do so in the state where they primarily operate their business.  Currently, bankruptcy law allows business debtors to file bankruptcy in the state which they [...]

Technically speaking, a business in Chapter 11 bankruptcy cannot receive a discharge of their debts. However, there is a way that a bankruptcy debtor in this chapter can receive debt forgiveness from their creditors. One of the most common ways of doing this is the "credit bid."  A credit bid is when a creditor purchases [...]

When Creditors Violate the Automatic Stay In most cases when a debtor files bankruptcy, creditors stop all actions against them, including lawsuits and garnishments. However, sometimes there are creditors who, either because of ignorance or stubbornness, violate the automatic stay. When that happens debtors may need to take legal action. But first let's talk about [...]

In a recent Chapter 7 bankruptcy in Texas, a creditor attempted to have a debtor's bankruptcy discharge denied because they allegedly made a false oath. The bankruptcy code describes the parameters for which a debtor's discharge can be denied as the following: Denial of Discharge Under §727(a)(4)(A): False Oaths. Section 727(a)(4)(A) provides that: (a) The [...]

Filing bankruptcy helps debtors discharge debt; but more importantly it helps them protect their valuable assets from creditors.  When a debtor decides to file bankruptcy, the most important decision they will make is whether or not they will protect an asset.  Chapter 7 bankruptcy allows the debtor to discharge debt after liquidating nonexempt assets while [...]

Elderly Americans have been hit hard by the recession. Falling home values, depreciating retirement accounts and shrinking pensions have conspired to place many senior citizens in financial troubles which are often only relieved by bankruptcy. Many senior citizens hit by the contraction of the economy are finding it difficult, if not impossible to pay credit [...]

When it comes to discharging state and federal income taxes in bankruptcy, the courts use what may appear to be a complicated set of rules and timeframes. Let's Try to Make it Simple for Those Considering Bankruptcy: Taxes which had a due date which was 3 years before filing bankruptcy may be dischargeable. For example, [...]

One of the biggest reasons why so many debtors fail to file bankruptcy as soon as they need it is because they are often paralyzed with fear about the bankruptcy process and the effects that bankruptcy will have on their life. Below are four reasons why debtors dealing with debt issues shouldn't fear bankruptcy: Bankruptcy [...]

Debtors who have incurred debt because of foolish financial decisions will not be denied a bankruptcy discharge. However, debtors engaged in fraud can find that their bankruptcy discharge is denied. But how can the court tell the difference between foolishness and fraud? Let's take a look at a few examples: A debtor who uses one [...]

If a debtor earns more than the median income for their state, they must take the bankruptcy means test. The reason the bankruptcy means test was implemented was to prevent abuse of the bankruptcy process. Specifically, the architects of the 2005 bankruptcy reform act, wanted to make sure that those who earned enough money to [...]