Stop the insanity – do not liquidate your 401K to pay off debt!!!!
Posted August 29th, 2010
A recent report from Fidelity brings to light a disturbing trend in our country: record numbers of people are making hardship withdrawals from their retirement accounts, and near record numbers of people are borrowing from these accounts. As your friendly neighborhood bankruptcy lawyer in Colorado, I see this trend happening every day and it both saddens and frustrates me. This is because early withdrawals from your retirement account take from your future while simultaneously enabling your creditors to reach funds they otherwise could not touch. (more…)
Legal Protections for America’s Military: The Servicemembers’ Civil Relief Act
Posted August 16th, 2010
Hey all! This week’s post comes from NOLO. We believe it is very informative regarding the well-deserved rights of active service members against creditors. In addition to the rights listed below, the bankruptcy code exempts from means testing for Chapter 7 eligibility for both; i) disabled veterans whose indebtedness occurred primary during a period when they were on active duty or performing a homeland defense activity; and ii) members of the military reserves or National Guard for the period when they are on active duty or performing homeland defense activities, and for 540 days thereafter. These exemptions may enable higher income debtors to qualify for Chapter 7 if they were previously or are currently on active duty.
Active service members can take steps to reduce loan obligations, prevent court judgments, and avoid eviction and foreclosure. (more…)
What Happens to My Student Loans in Bankruptcy?
Posted July 25th, 2010
Student loans and bankruptcy are a complicated area, and not many bankruptcy filers understand how bankruptcy affects their student loan debt and what their options are and how they differ between Chapter 7 and Chapter 13 bankruptcy. (more…)
What We Can Learn From The Rich
Posted July 11th, 2010
A recent article in the New York Times deals with the fact that the rich are more likely to walk away from their underwater mortgages. One in seven owners of million-dollar plus property is in default, compared with one in 12 for properties worth less than a million. (more…)
Giving Away Property Prior to Bankruptcy: You’re Buying Trouble
Posted June 29th, 2010
If you’re struggling to pay your debt and your creditors are closing in on you, you may be tempted to give money or property to friends or family in hopes of keeping it away from your creditors. As a bankruptcy lawyer, I have some words of advice for you: DON’T DO IT! These transactions are generally considered fraudulent both in and out of bankruptcy court. Worse, these moves can taint your entire case, enticing judges to throw the book at you!! (more…)
What Happens to my Cosigner in Bankruptcy?
Posted June 21st, 2010
A cosigner is someone who has signed up to guarantee payment of a debt if the primary debtor fails to make payments. A cosigner is also called a codebtor in bankruptcy. Co-signers are usually friends or family members with good credit who are added to a loan to provide added assurance to the lender that the loan will be repaid if the primary borrower (who wouldn’t qualify on their own) fails to make all payments. A bankruptcy by one cosignor affects the rights of the other cosignor. (more…)
Wage Garnishment: Big Stick for Creditors, and a Good Reason to File Bankruptcy
Posted June 14th, 2010
When you are behind on paying your debt, life can be stressful. You may feel helpless, wondering what to do. Or maybe you think your creditors won’t do anything other than call you multiple times per day. Whatever the case, you should know that your situation can get much worse when a creditor sues you and garnishes your wages. In many states, this means they can take 25% of your income, leaving you unable to pay for life’s basic necessities. You should also know that bankruptcy can help you avoid this desperate situation. (more…)
What Happens at my Chapter 7 §341 Meeting of Creditors?
Posted June 8th, 2010
For many bankruptcy filers, the prospect of the §341 Meeting of Creditors causes some stress and anxiety. It’s normal to be apprehensive about your 341 Meeting, but at the same time it’s nothing to be afraid of because most 341 hearings go quickly and smoothly. As with all other aspects of your bankruptcy case, preparation is the key. So what follows is an overview of the 341 process to ease your worried mind. (more…)
What Happens To My Non-Exempt Property in Chapter 7 Bankruptcy?
Posted May 23rd, 2010
Let’s say you are lucky enough to qualify for Chapter 7 bankruptcy. You pass the means test (maybe because of the legal magic of a good bankruptcy lawyer), your debts are dischargeable, you’re ready to file bankruptcy and get free from a load of debt and stress. But you have a problem. You have non-exempt property. Property that doesn’t fit into one of the Colorado Bankruptcy Exemptions. What are your options? (more…)
Here ye, here ye, let it be known from this point forward: DON’T BANK WHERE YOU BORROW!
Posted May 10th, 2010
Over the course of civilization, pearls of wisdom are developed which are so important and self-evident, they become part of the basic lessons passed down from generation to generation. Who knows when they came about in the evolutionary chain, but maxims such as ‘Never eat yellow snow’ are so well established that they seem to be part of our DNA. While it may be rare for anyone to join the short list of people who actually coin a phrase which becomes part of our fundamental decision making, I believe I may just be one of those people. For the recent financial crisis (and my work as a bankruptcy attorney) has given me clarity to see a basic truth which your mother never told you about – DON’T BANK WHERE YOU BORROW. (more…)