According to a report by the Administrative Office of the U.S. Courts, bankruptcy filings for the 12-month period ending March 31, 2009, increased by 33.3 percent over bankruptcy filings for the same period in 2008. As of March 2009 1,202,503 bankruptcies have been filed nationwide. The vast majority of those bankruptcies were filed by individuals. [...]
Running into financial problems soon after receiving a bankruptcy discharge is more common than one would imagine. Often debtors file Chapter 7 bankruptcy and reaffirm debts such as a mortgage or car payment; but are unfortunately unable to continue payments shortly thereafter. A common scenario is that a debtor will reaffirm a car payment and [...]
Debtors filing for Chapter 7 bankruptcy are required to take a "means test" which is designed to determine if the debtor has the ability to repay a substantial portion of his/her debts within a three to five year period. However, there are some exceptions to the means test: Social Security Income: Income from social security [...]
There's a very interesting bankruptcy case Grueneich, James B.; In re (Grueneich v. Doeling, Trustee) where a debtor was accused of "gaming the system" and faced his exemptions being denied. Fortunately, the debtor won on an appeal; but the case is a warning to all debtor's filing bankruptcy. The details of the case: The Chapter [...]
There's an interesting Chapter 7 Bankruptcy case (Sawyer, Kim E.; In re,) where a debtor attempted to reaffirm a debt; but was denied the reaffirmation because she lacked income and failed to prove how the debt would be paid The details of the Chapter 7 bankruptcy case: The Chapter 7 debtor asked the court to [...]
There was an interesting Chapter 7 Bankruptcy case Weimann, Vincent O. and Brenda K.; In re, (Bankr. N.D. Ill. 2009) involving a debtor who was able to exempt property as tools-of-the-trade despite a temporary interruption in his business. The details of the case: The Chapter 7 debtor-husband owned a boat rental business. He operated the [...]
There's an interesting bankruptcy case, Carver, Chaddrick R.; In re (Richardson, Trustee, v. Carver), (Bankr. C.D. Ill. 2009) in which a debtor transfers the profits from the sell of his house into a bank account of his non-debtor spouse; a move which initially jeopardizes his Chapter 7 bankruptcy discharge. The bankruptcy allows the transfer because [...]
According to an article in the Dallas Morning News, the Commerce Department reported Monday that consumer spending, which accounts for 70 percent of the nation's economic activity, dropped by 1 percent in December and savings increased 1.7 percent for 2008. But that's from a low of 0.4 percent in 2005 which was only slightly better [...]
In the bankruptcy case of Washington Mutual Bank v. Heard, a debtor's Chapter 7 bankruptcy discharge was denied because she failed to disclose asset transfers that occurred before filing for bankruptcy. In the bankruptcy case the debtor defended her failure to disclose asset transfers by stating that she was a housewife who handed over all [...]
When massive changes to the bankruptcy law were implemented in 2005, the means test was designed to help clarify who qualifies for Chapter 7 bankruptcy, especially amongst high income debtors. Using "currently monthly income" was supposed to be the key to deciding if a debtor financially qualified for Chapter 7 bankruptcy; but now the courts [...]