Recent Updates
April 28, 2010
State Must Prove Defendant's Knowledge of Driver's License Suspension
April 13, 2010
Sentencing Commission Votes to Eliminate Recent Criminal History Points
October 15, 2009
Consent to search inside of vehicle does not extend to locked containers
October 14, 2009
Making phone calls to get drugs for personal use not a felony
October 07, 2009
Duval County schools agree to reduce number of students getting arrested
Bankruptcy
This section of our blog updates issues dealing with bankruptcy in the Middle District of Florida (based in Jacksonvile, but includes Gainesville, Ocala, Daytona, and the surrounding area)??and nationwide.????Whether it involves filing a??Chapter 7 or Chapter 13,??keeping??one's house, getting a fresh start from credit card debt, being laid off from work, repossession of homes, vehicles, cars, or??how the means test applies to you, we??seek to provide information that current and potential clients find useful.?? ??
End of Year Considerations for Tax Returns in Bankruptcy cases
October 30, 2008
With the end of the year coming, those filing bankruptcy have to consider and factor in their tax refunds in making decisions about when and how to file bankruptcy. Tax returns, present and future, in amounts known and not known, are potential assets of the estate. This is a two edged sword. On the one hand, the future income may be protected under personal property exemptions allowed in Chapter 7. However, they also can be considered to be income or assets in a Chapter 7 or Chapter 13.
Persons get into trouble when they take loans or get rapid refunds at sites such as these hyperlinked here on these future assets which can be ignored by the Trustee. Sometimes it pays to wait until the person receives the refund to pay for things such as tax liens, secured debts, or their attorney's fees. Some clients decide to wait till they have realized their return to file in order to save this money.
Rising Health Care Costs; Unexpected Medical Emergencies and Bankruptcy
October 29, 2008
Many of our clients who are seeking bankruptcy relief do so because of their health care costs. The clients reach the point of needing bankruptcy help usually for one of three reasons:
1. Ongoing health Problem
2. Steep rises recently in the cost of their healthcare
3. Medical emergencies
Ongoing Health Problems
Persons who have suffered long term health problems such as heart disease or diabetes have often have limited earning abilities. Long term medical treatment puts a drain on the financial health of the client, particularly those who at one time were health. A slow or moderate decay in the ability of the client to pay bills should be addressed early to avoid loss of assets, such a homes or vehicles.
Rising Health Care Costs Make Matters Worse
The National Coalition of Health Care reports that health care costs in 2007 rose at more than twice the rate of inflation. http://www.nchc.org/facts/cost.shtml These increases, combined with the limit on the earning power of those in poor health, eventually can lead to a person falling so far behind on their bills that nothing short of bankruptcy will allow the person to keep their assets or allow the person an ability to start over with a fresh start.
Medical Emergencies
Sudden and traumatic health emergencies, such as heart attacks, stroke, car or other accidents, often have a two-fold effect. One, the person is often saddled with expensive medical bills, particularly for those without medical insurance. In fact, the high cost of medical treatment is the main reason why persons don't have insurance in the first place. See this link for a discussion of this topic. http://www.kff.org/insurance/7672/index.cfm
We recently consulted with a client who was an executive in another state who had a sudden medical condition come on that cost the client the ability to hold any job. Despite their high management position with a national company, within six months the client had run out of disability payments and was reduced to taking unemployment. Their income dropped by more than 70 percent. This caused stress in the marriage which led to a divorce and the client having to move in with their adult child. The bankruptcy will protect the client from in excess of $200,000 in debts from the former martial home, cars, credit card debt, and other loans.
If you are considering bankruptcy in Florida because of financial strain caused by medical bills, give us a call at the Arnold Law Firm at (904) 731-3800 and set up a free bankruptcy consultation.
Can Bankruptcy stop a foreclosure in Florida?
October 29, 2008
The answer to this frequently asked question is it depends. It depends on which Chapter of Bankruptcy one files, Chapter 7 or Chapter 13. Whenever a bankruptcy action is filed, an automatic stay is placed against all creditors, but this is only temporary. Under a Chapter 7, when the automatic stay is lifted, all secured creditors are left in place and are free to "finish" any foreclosure and/or repossession proceedings. However, under a Chapter 13 financial re-organization plan, the debtor and the creditor must sit down and work out a payment plan for the house - thus allowing the debtor to keep the house and effectively terminate the foreclosure proceedings.
Woman Chains Herself to House to Prevent Foreclosure
October 28, 2008
Chapter 13 is a much easier route to prevent a foreclosure. This is an extreme example, and our experience finds that the lenders are willing to work with counsel for those in trouble because the banks don't want another home to own. However, this woman has taken an extra legal route that is not recommended:
http://abclocal.go.com/kfsn/story?section=news/state&id=6473678
http://www.cnn.com/video/#/video/us/2008/10/28/ca.woman.chain.cnn
Credit Lines Disappearing
October 27, 2008
As home values have dropped over the last year, banks have cut off previously existing lines of credits to homeowners, even those who were current or had never accessed their credit line previously. These credit lines, made for when times get hard, are exactly the monies that some of our clients depended upon being there if they become sick, were laid, etc. Many have had to seek bankruptcy relief because the banks have backed out of their promises. These are a few of the many articles that have discussed this matter:
http://ezinearticles.com/?Homeowners-Locked-Out-of-Their-Home-Equity-Lines-of-Credit&id=1010028
http://findarticles.com/p/articles/mi_qn4176/is_/ai_n24373447
Some Downsizing to 100 square foot houses
October 22, 2008
CNN reports that the economy for some is so bad that they are downsizing to 100 square foot houses. This article is about a couple where a former housing contractor has moved into, and now builds these tiny houses.
http://www.cnn.com/2008/LIVING/wayoflife/10/22/tiny.houses/index.html
Bankruptcy for Senior Citizens
October 22, 2008
We have noticed an increase in inquiries for bankruptcy for clients over 60. This group typically has among the lowest amount of bankruptcy rates, particularly because most persons grew up in an age when credit was not available like it is (or was before the credit crisis) today . The USA Today had an interesting essay on this issue not long ago:
http://www.usatoday.com/money/perfi/retirement/2008-06-16-bankruptcy-seniors_N.htm
Relief from Stay
October 22, 2008
In most cases, the filing of bankruptcy grants an "automatic stay" or relief from the collection action of creditors against a debtor. This stops any court from taking any action in a lawsuit and your creditors from calling or otherwise contacting you. This is the number one thing our clients say is their benefit from filing of the petition: the phone calls stop, the letters stop.
However, the stay can be "lifted" or removed. It is the burden of those seeking to lift a stay to show that there is cause for a judge granting such relief. Usually these cases concern real estate. Sometimes the creditor wants to foreclose the property. The most common argument is that there is no equity in the property and therefore the foreclosure action should be able to continue. Even if granted, the debtor is protected from future money damages in most cases although they lose the ability to control the disposition of the property.
To get relief from stay in a bankruptcy proceeding (creditor) or to fight a relief from stay hearing (debtor), you should seriously consider hiring an attorney. In Jacksonville Bankruptcy cases, relief from stay hearings are usually scheduled two to three weeks from the date of the motion for relief from stay, so time is critical. Sometimes the judge will decide the matter immediately or may pass the matter for further proceedings. In any event, time passes quickly in these matters.
The link to the pertinent portion of the Code concerning relief from stay is found at the following link: http://frwebgate.access.gpo.gov/cgi-in/getdoc.cgi?dbname=browse_usc&docid=Cite:+11USC362
2008 Means Test Median Incomes
October 22, 2008
The means test is a provision of the 2005 amendments to the Bankruptcy code that created "abuse" standard to through a formula determines who should be allowed to declare Chapter 7 bankruptcy. Most debtors think of Chapter 7 or liquidation as the preferred method, although there are instances when Chapter 13 is preferable.
In short, if a debtor makes more than the State median income has more than $167 a month in disposable income, then there is a presumption that the filing of a Chapter 7 would be abusive. In practice, bankruptcy attorneys are often successful in demonstrating that the debtor is not abusing the process. Perhaps the debtor's income is going down due to a cut in wages, a recent divorce, health problems, or projected future income.
| . |
| FAMILY SIZE | ||
| 1 EARNER | 2 PEOPLE | 3 PEOPLE | 4 PEOPLE * | |
| Florida | $38,927 | $49,234 | $55,347 | $65,024 |
The link for all states is found at the Department of Treasury's site at http://www.usdoj.gov/ust/eo/bapcpa/20080101/bci_data/median_income_table.htm
Current Real Estate Market Mood
October 21, 2008
Most of our bankruptcy clients have serious issues with their real estate holdings. Apparently this survey done by the Univeristy of Florida may indicate a bottom is in regarding Florida's real estate market.
http://news.ufl.edu/2008/10/20/housing-10-08/
Congress Finally Acts
October 03, 2008
October 3, 2008
Although the Congress passed the Bailout Package for Banks today, http://www.cnbc.com/id/27010467, it failed to include the Bankruptcy provisions that would have allowed Bankruptcy judges to reduce first mortgages down to market value. Therefore, although the bill will marginally help restart the credit markets and is good for the banking stocks, it will do little to help the housing mess across the country and in Northeast Florida.
Right now, more than 80 percent of our clients are upside in their homes. Real reform in Chapter 13 rules to allow a bankruptcy judge to reduce the amount due on a first mortgage would help accelerate the housing crisis and help banks mark its loan to the real market. However, the banks, I believe to their own determinant have opposed this idea.
One of the most important aspects of the filing of a bankruptcy claim is the timing of the claim.?? Many important rights can be gained or lost based on a proper timing of the claim.?? Contact the Arnold Law Firm's bankruptcy attorneys today to discuss your bankruptcy needs.??
