Tag Archives: discharge

Reopening a Bankruptcy Case

Reopening a Bankruptcy

Bankruptcy Attorney in Melbourne, Florida

The drafters of the bankruptcy laws were wise enough to realize that humans make mistakes. As a result, if you realize after your discharge order has been entered that an error was made in your bankruptcy case, it may be possible to reopen your case to fix the mistake. It should be noted that it is not a guarantee that the court will allow you to reopen your case, so it is essential that you try to get everything done correctly when you initially file.

The most common reason for reopening a bankruptcy case is that a procedural error occurred. This includes errors such as:

  • failure to timely file your counseling certification (Official Form 23)
  • failure to follow procedure for removing a judgment lien on real property
  • failure to name an essential creditor
  • failure to list a valuable asset
  • a windfall of money or income (trustee might request the reopening)
  • any other reason approved by the court

The process to reopen a case involves the debtor filing a motion asking the court for permission to reopen the proceeding. You must typically pay a fee to file the motion. Typically, the debtor requests that the case be reopened without giving notice to all of the creditors and without a hearing. Providing limited notice only to the parties impacted by the error being fixed is usually sufficient. The debtor’s motion must provide a detailed explanation of the mistake that occurred and why the case should be reopened to cure it. If the motion is approved, the case will proceed on the specific issues outlined in the motion until they are resolved.

You should never rely on the idea that you can reopen your bankruptcy filing. It is imperative that you closely review your initial pleadings to verify that they are complete and correct. Reopening a case costs you time and money, but it is an option if you need it.

If you have discovered an error in your bankruptcy case, let us help you obtain permission to fix it. Contact Faro & Crowder, PA to schedule an appointment.


DUI Debt in Bankruptcy

Attorney serving Satellite Beach, Florida

Faro & Crowder, PA

When you file for bankruptcy protection, your primary goal is typically to discharge or eliminate your debt. However, it is important to understand that there are certain types of debt that the law excludes from being discharged. Pursuant to 11 U.S.C. §523(a)(9), one type of debt that is not eligible for discharge is one arising from the “death or personal injury caused by the debtor’s operation of a motor vehicle, vessel, or aircraft if such operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance.”

In other words, if you were driving under the influence of drugs or alcohol and you caused a wreck, any debt you owe to the victims of the accident cannot be discharged. In most cases, you cannot eliminate restitution damages or monetary penalties imposed by the court.

It is possible that an insurance company seeking to recover subrogation damages will file can objection to your discharge pursuant to 11 U.S.C. §523. Debts resulting from the “willful and malicious injury by the debtor to another entity or to the property of another entity” are excluded from discharge under section 523(a)(6).

You should also be aware that the bankruptcy courts follow the state law of the jurisdiction where your criminal prosecution was held. This means that the results of the blood alcohol limit of the state where you got your DUI will apply, not the state where you file your bankruptcy case. This prevents debtors from “forum shopping” and filing their bankruptcy case in a jurisdiction with a higher blood alcohol level in an attempt to escape liability.

If you have DUI-related debt and you are considering filing a Chapter 7 of Chapter 13 case, it is essential to obtain legal help. One of our personal bankruptcy attorneys can review all of your debts and help you understand how each of them will be handled in your filing.

If you are interested in learning more about how a bankruptcy filing will impact your debt, contact Faro Crowder, PA to schedule an appointment.  Our offices are located in Melbourne, Florida but we proudly serve individuals, families and businesses located in Palm Bay, Viera, Cocoa, West Melbourne, Cocoa Beach, Satellite Beach and the Space Coast.


What Will Happen to My Student Loans in Bankruptcy?

Discharging student loans in a personal bankruptcy case can be difficult. The debtor must establish an “undue hardship,” which is a tough standard to meet. If you are unable to show an undue hardship, what happens to your student loans in your bankruptcy case? The answer depends on your finances, the type of bankruptcy you filed and the kind of student loans you have.

Student Loans in Bankruptcy | Melbourne, Florida

Federal Student Loans

As soon as you file your petition, all collection activity on your federal student loans must cease. In other words, you will no longer receive a monthly statement, receive collection calls, or any other notices that your payment is due. In a Chapter 7, you will receive a four to six month reprieve from making your student loan payments. In a Chapter 13, you can obtain up to five years relief from making your full payments. Additionally, in a Chapter 13 your co-debtor is protected from collection activity while your case is pending.

While bankruptcy provides you relief from being required to make your student loan payments, it is imperative to remember that interest on your federal loans will continue to accrue. Thus, if you do not make your payments while your bankruptcy is pending, the interest will accrue and leave you with a much larger amount to repay when your bankruptcy is over. Additionally, if you have been rehabilitating your defaulted federal loan, you must start over when you emerge from bankruptcy.

Private Student Loans

Private student loans are governed by the terms and conditions set forth in the promissory note you signed in favor of your lender. Many private loans have a provision that a bankruptcy filing by the borrower is considered a default on the loan. Of course, for many student loan borrowers, their loan was in default prior to seeking bankruptcy protection, so the provision doesn’t come into play. However, if your loan is not in default before you file bankruptcy and you have a co-signor, your filing being considered a default could negatively affect your co-signor.

If you have student loans and you are considering filing a Chapter 7 or Chapter 13 case, it is important to confer with a seasoned bankruptcy lawyer. To learn more about how Faro & Crowder, PA can assist you, contact us for a free consultation.

Contact a Brevard County Bankruptcy Attorney at Faro & Crowder, PA

If you are interested in learning more about how a bankruptcy filing will impact your debt, contact Faro Crowder, PA to schedule an appointment. We are located in Melbourne, Florida on Sarno Road and serve residents and businesses of the Space Coast and Brevard County.

Services Areas

We provide services throughout Central Florida including: Melbourne, Titusville, Palm Bay, Merritt Island, Cocoa, Cocoa Beach, Satellite Beach, West Melbourne, Cape Canaveral, Viera and Eau Gallie.

Get In Touch with Faro & Crowder, PA

Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

The information on this blog or any blog is not intended as, and should not be taken as, legal advice.

Bankruptcy Discharge: What does it really mean?

The primary goal of filing a personal bankruptcy is to eliminate debt or obtain a “discharge of debt.” A discharge order cancels your liability to repay the debt. As a result, many people save thousands of dollars by filing a Chapter 7 or Chapter 13 case, which is often referred to as obtaining a fresh financial start.

When you file bankruptcy, you are required to disclose ALL of your debts, assets, expenditures, income and other financial information. You must file a complete list of your creditors (anyone you owe money to) which is called the “creditor matrix.” The court uses your creditor matrix to mail notice of your filing to all of your creditors. This benefits you because all of the creditors who receive notice of your filing will be bound by your discharge order.

At the conclusion of a successful bankruptcy case, you will receive your discharge order. Once you obtain your discharge, creditors are prohibited from taking any collection activity against you regarding the discharged debt. This means you will no longer receive harassing telephone calls, demanding letters, or have collection lawsuits filed against you for discharged debts. If a creditor ignores the discharge order and take action to collect a discharged debt, you may be able to recover a monetary judgment or sanctions against that creditor.

Contact Faro & Crowder, PA to discuss your individual circumstances with an experienced personal bankruptcy attorney. If you have questions regarding filing a Chapter 7 or Chapter 13 case, contact us for a free consultation.


IRS Debt in Bankruptcy

If you are past due on your taxes, you are likely wondering if you can discharge the debt in your bankruptcy. It is important to have a seasoned bankruptcy attorney review your taxes and help you understand what is dischargeable because some taxes can be eliminated while others cannot.

IRS Debt Bankruptcy | Brevard County Bankruptcy Attorney

If you did not file your income tax return with the Internal Revenue Service (IRS), the tax debt does not qualify to be discharged. If the IRS filed a tax return on your behalf, it is not considered to be a filed tax return making your tax debt dischargeable. Your federal income tax debt should be eliminated in your bankruptcy if:

  • At least two years prior to your bankruptcy filing, you filed your tax return for the tax year(s) you are seeking to discharge
  • The tax debt that your are trying to discharge was due at least three years prior to your bankruptcy filing
  • The IRS has not assessed your liability for the taxes you are trying to eliminate within the 240 days preceding your petition date
  • You did not intentionally and willfully try to avoid paying your taxes

If you have tax liens recorded against you and you are considering filing a personal bankruptcy, it is important to understand how they will be handled in your case. Your personal liability to pay the tax lien is discharged in your bankruptcy filing; however, the lien is still valid.

What does this mean? In short, the creditor holding the lien cannot use collection efforts (lawsuits, garnishments, etc.) against you to satisfy the debt. Additionally, discharged creditors cannot pursue assets that you acquire after the bankruptcy, or assets that you exempted in your filing. So, if your bankruptcy discharge applied to older taxes, the taxing authority cannot garnish your future paychecks.

However, a lien against your property may survive the bankruptcy. A properly perfected tax lien can attach to all of your personal and real property in the county where it is recorded. The important determination is how valuable the property is that the lien attaches to. The IRS will not expend the time and money to pursue a tax sale if the property has only minimal value, which is often the case.

It is also important to note that tax liens expire. The statute of limitations for most federal tax liens is 10 years from the date the tax was assessed (not the date the lien was recorded). As a result, many people rely on the passage of time to resolve their tax lien after a bankruptcy filing. It may also be possible to negotiate the release of the lien for a small settlement payment.

Contact a Brevard County Bankruptcy Attorney at Faro & Crowder, PA

No two cases are identical and how to handle taxes in a bankruptcy filing can be a complex matter. To get the legal help you need, call us to schedule a free consultation. We are located in Melbourne, Florida on Sarno Road and serve residents and businesses of the Space Coast and Brevard County.

Services Areas

We provide services throughout Central Florida including: Melbourne, Titusville, Palm Bay, Merritt Island, Cocoa, Cocoa Beach, Satellite Beach, West Melbourne, Cape Canaveral, Viera and Eau Gallie.

Get In Touch with Faro & Crowder, PA

Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

The information on this blog or any blog is not intended as, and should not be taken as, legal advice.

Chapter 11 Bankruptcy Can Benefit Individuals

Many individuals believe that a Chapter 7 or 13 is the only bankruptcy relief available to them. However, a Chapter 11 isn’t only used for corporate restructures, it can allow an individual debtor to take advantage of a meaningful debt restructuring as well.

Chapter 11

When to Consider Chapter 11

You may be ineligible to file a Chapter 7 case because you have too much disposable income after paying your necessary living costs, which means you cannot pass the means test. Additionally, the debt limit for filing a Chapter 13 may be insufficient for you if you have borrowed a significant amount of money. A Chapter 11 provides a good option for dealing with your debt and managing your finances.

Benefits of a Chapter 11

The Chapter 11 process allows a debtor to handle even the most complex issues and a large amount of debt. Other advantages include:

  • A Chapter 11 debtor is not required to pass the means test.
  • You can propose a repayment plan, which allows you to pay less of your disposable income to unsecured creditors. Additionally, plan payments may be delayed until the plan is confirmed, but adequate protection payments must still be paid to secured creditors until confirmation.
  • You can modify your secured loans, including mortgages and vehicle loans. Unlike Chapter 13, however, a debtor does not have a time requirement for how long the vehicle had been originally financed before the loan can be reduced to the value of the vehicle.
  • Typically, a Chapter 11 debtor keeps possession of his/her assets and manages his/her own finances under supervision of the trustee.
  • Chapter 11 can be advantageous for individuals with substantial tax debt.

Downside to Chapter 11

The Chapter 11 process can be complex and it can be costly. However, in many cases, the time and expense involved is outweighed by the amount of debt the debtor is allowed to eliminate.\

Contact a Chapter 11 Bankruptcy Attorney at Faro & Crowder, PA

To learn more about how a Chapter 11 bankruptcy can benefit an individual, contact us for a free consultation.

We provide individuals, families and businesses with debt relief and foreclosure services in Brevard County included the areas of Palm Bay, Melbourne, Viera, Eau Gallie, Titusville, Satellite Beach, Cocoa Beach, Cocoa and Cape Canaveral.

Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

We are a debt relief agency. We help people file for bankruptcy under the bankruptcy code.

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