October 27, 2011
Timeline of a Bankruptcy Filing
Some common questions I get asked about filing bankruptcy are, how long does it take and is there anything I should be doing or not doing before I file? For many people struggling with debt there are limited options and often they decide to turn to the bankruptcy court. The most common type of bankruptcy filing is Chapter 7, which can wipe out unsecured debts and provide a fresh start in as little as a few months.
But the process can be complicated. In many cases, what you do before filing is just as important as what happens after. Check out the Chapter 7 timeline below to see what a bankruptcy filer can expect and how long the process usually takes.
1 Year Before
Attempting to delay payments of defraud creditors, such as through hiding, transferring, or destroying property or assets, in the year before filing for bankruptcy could be considered bankruptcy fraud and could result in an unfavorable outcome in your case and criminal penalties.
Paying back a relative or business partner (“insiders”) during the year before filing could be deemed an unlawful preference by the court and it may seek to recover those payments and distribute them to your other creditors. It’s a good idea to talk to a bankruptcy attorney if you have questions about this.
6 Months Before
In the 6 months before filing you must have a meeting with an approved nonprofit budget and credit counseling agency.
3 Months Before
If you take out credit of $500 or more for luxuries in the 3 months before filing that luxury debt may not be dischargeable.
Filing for Bankruptcy
As soon as you file your bankruptcy petition, the court will order an injunction called an “Automatic Stay” that will prevent creditors from taking most legal or collection actions against you during your case or until it is lifted by the court.
You are appointed a trustee, a federal employee who will meet with you and oversee your case.
15 Days After
Certain papers declaring your assets, liabilities, expenses and income must be filed within 15 days of your petition, but are typically included with your filing.
15 days after filing your petition the court will schedule the meeting between you, your trustee, and creditors.
30 Days After
Papers declaring your intention to keep property that serves as collateral, or hand it over to creditors, must be filed and served to the trustee and creditors within 30 days of your petition or by the date of the meeting of creditors, whichever occurs first.
3 to 6 Weeks After
The meeting between you, your trustee, and creditors typically happens 20 to 40 days after filing. If you do not attend the meeting your case will be dismissed.
Withing 6 weeks you must file a certificate from an attorney that you have been advised on your bankruptcy options, and file a statement of any increased income or expenditures you can foresee in the near future.
4 to 6 Months After
A successful Chapter 7 bankruptcy case typically leads to a debt discharge within 4 to 6 months of filing.
Could Your Small Business Survive A Divorce?
There are many couples who are running small businesses together and it’s not uncommon for them to be faced with big decisions as to how best position the company for success. What happens, however, when the couple decides that it is time to end their personal relationship and divorce becomes a serious reality and not just a possibility? Many couples find that being both husband and wife and business partners can be challenging. That challenge is increased several times over when a divorce works its way into the business relationship.
According to information from the National Federation of Independent Business, there are more than one million husband-and-wife partnerships running businesses nationwide. When divorce becomes a reality, the couple, their legal representation and even the judge can have a tough time sorting through all the material.
For those who may not know, divorce law is centered on the idea of marital property, whereby, anything acquired during a marriage is in all likelihood consider marital property.
In the event the husband or wife was running the business and the other spouse was at home raising kids or working elsewhere, it does not matter. The law will look at this scenario as the partner not inside the business still in some manner contributed to its success. That being the case, the person more removed from the business is still entitled to their fair share of the company, oftentimes half. In instances where one individual had the business prior to the marriage, but kept it during the married relationship, any increase in revenue during the couple’s time together is viewed as marital property.
So what are some of the possibilities that can come out of a divorce involving business partners? Among the three most common are:
- Buyouts – While some divorced couples do continue working together, many find it’s not doable. If that is the case in your situation, would you consider a buyout of your business partner? An accountant can help provide you with the financial details of such a decision, whether in fact it will all be done at once or over time. Remember, however, losing one of the partners could have a major impact on the business, so think it through.
- Staying in business together – While this one may not be at the top of your choice list, it can prove amicable in some instances. Given the fact you are not likely a very rich and large corporation, it doesn’t mean you cannot put in place a board of directors for the business. By doing so, you get an unbiased opinion (hopefully they’re not playing favorites) and can move along and do what is best for the company.
- Putting the business up for sale – This can be an unpopular decision, but sometimes it is best for all parties involved. It is important for divorcing couples to remember that less than 50 percent of small business put up for sale actually sell. Selling the business should be a last option given that you have hopefully been successful financially up to now with it. If the business is bringing in good revenues, both parties may be advised to work out a situation so that scenario can continue.
At the end of the day, both involved parties need to ask themselves if they could see a scenario where they could be divorced from one another, yet continue to work together on a regular basis.
If you are considering a divorce but aren’t sure of your options I offer a free initial consultation where I can answer all your questions and help you determine the best way to proceed.
October 20, 2011
Alternatives To Bankruptcy
Anyone who has had a call from a debt collection agency knows that this can be a very confusing and frustrating experience. Part of the collection agency’s strategy is to deliberately overwhelm you with legal terms and threats, so that you’ll just give in to their demands without considering what is really best for your overall situation. Their aim is to get you upset so you’ll be more pliable. Plus the normal response when you receive a mail notification from a collection agency is to immediately hit the panic button. So what can you do to get out of this uncomfortable situation, without making decisions or agreements that you later regret?
As an attorney, I have helped many people successfully file for bankruptcy and wipe out their debt. Plus once you file bankruptcy, the collection calls and threats will stop. But are there alternatives to filing bankruptcy? Yes – the main alternative to filing bankruptcy is credit negotiations and/or debt settlement. This can be a minefield if you don’t know what you’re doing. So, if you decide you’d like an alternative to bankruptcy, I offer a credit negotiation service that may be right for you.
Many consumers are unaware of their risks with unpaid debts. Yes, it’s true that a creditor could sue you in court and win a judgment, allowing the creditor to garnish your wages or hire a sheriff to come get your property. However, the chances of this happening are not as great as you would think.
It’s true that collection agencies are turning to lawsuits more and more these days, but once you make the creditor aware that you know the law and have an attorney on your side, they are more likely to leave you alone. With savvy consumers, many debt collectors think it is simply too much trouble and expense for them to take legal action against a debt. They look at the cost of filing a suit versus the amount that they are likely to recover.
Many consumers feel that their debts are overwhelming and there is nothing they can do other than file a bankruptcy. They believe those awful tales spun by collection agencies of impending doom, especially about garnishment and seizure of property. Collection agents fail to mention (surprise!) that in order for these actions to take place, the creditor must first go to court. Due to lack of information, many consumers get panicky and assume that bankruptcy is their only option.
So if you have debts that are out of control or are being harassed by a collection agency and don’t know what to do. Please contact my office for a free 30 minute telephone consultation where we can go over you options and you can decide if credit negotiation might be the best option for you.
California Passes Divorce Law For Same Sex Couples
The California legislature has just passed a bill, which was signed into law in October by Governor Jerry Brown that allows same-sex couples to divorce who got married in California but now reside in another State. Or couples that have always resided in another State but came to California to get married when same-sex marriage was available in California and are now wanting a divorce but are unable to get a divorce in their home State. The bill is titled SB (Senate Bill) 651.
One aspect of the battle over same-sex marriage has been the lack of access to divorce courts for same-sex married couples that reside in non-recognition states. Judges in many states have refused to grant divorces to lesbian or gay couples who went elsewhere to get married or have relocated from the state in which they got married, on the grounds that granting a divorce would constitute a form of official recognition of their marriage. Most of these couples are not asking a judge to grant them any property or spousal support based upon their marriage, since they’ve usually already settled those issues – they just want to get an order of dissolution. And the couples have good reasons for wanting the court order. Even if they have resolved their financial affairs, they need to get a divorce so they can be free of future liabilities and so they will be able to marry or legally partner a new romantic interest.
October 13, 2011
What Is Included in a Bankruptcy?
Steps to Take If You’re Planning a Divorce
Some couples who postponed getting a divorce because of the poor economy are finding they can no longer wait. If you’re among those planning to leave your marriage, there are important steps to take as soon as possible.
If you’d like more information on the best way to proceed. I offer a free initial consultation where you can get your questions answered.
October 6, 2011
Bankruptcy & Foreclosure
If you have been through a foreclosure and are now receiving collection calls or have even been sued your prior bank, give me a call and we can go over your options. I offer a free 30 minute telephone bankruptcy consultation, where you can get all your questions answered. Sometimes the bank is pursuing you despite the protections provided by California’s anti-deficiency laws and a simple letter will clear up the problem. For others bankruptcy may be the only way to avoid a large judgment and potential garnishment of wages.
Hollywood Breakups & Divorce
While the rumors are running thick and fast about a potential break-up between Demi Moore & Ashton Kutcher. Apparently another one of Hollywood’s couples have announced their intention to divorce. “X-Men” star James Marsden, who is best known for his role as “Cyclops” and his wife Lisa Linde are divorcing, after more than a decade of marriage.
Linde filed for divorce recently and cited irreconcilable differences in court documents. Linde is seeking spousal support and joint legal and physical custody of the couple’s two young children Jack and Mary.
According to Marsden’s representative, “This was a mutual decision, they are committed to raising their kids together and remain great friends.”
Marsden, 38, married Linde, daughter of country songwriter Dennis Linde (who penned Elvis Presley’s 1972 hit, Burning Love), in July 2000.
Demi Moore’s marital woes seem to be gaining a lot of media attention, the past weeks have been littered with reports of infidelity, isolation, hurt feelings and photos of a supposed San Diego mistress. But through everything, the pair have remained almost silent. Kutcher, 33, is said to have gone wild in San Diego at a tech convention on the weekend of his sixth wedding anniversary to Moore, 48. There are even suggestions that on the same weekend, Kutcher enjoyed the company of not one but two women at the San Diego Hard Rock Hotel.
We’ll have to see how this one plays out, perhaps there will be another Hollywood divorce in the not too distant future.