Bankr. E.D.N.C.: In re Cook- Mortgage Deduction on the Means Test not Capped at IRS Local Standard Ed Boltz Sun, 01/23/2022 - 23:30 Summary: The Cooks filed a Chapter 13 bankruptcy and, being above median income, were required to calculate their "projected disposable income" using Official Form 122C-2. As their plan provided for the retention of their home and cure and maintenance of the on-going mortgage, they deducted their monthly mortgage payment of $2,233.34 from the Means Test, despite the IRS Local Standard for mortgage expenses being only $1,098.00. The Trustee objected, following In re Harris, 522, B.R. 804 (Bankr. E.D.N.C. 2014), which held that “that the home and vehicle allowances serve only to operate as a ‘cap’ on the amount the Debtors may deduct, when their average monthly secured home and vehicle payments exceed the Standard amounts.” Here, however, the bankruptcy judge rejected that reasoning, finding that "[i]n enacting the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCPA”) in 2005, Congress intentionally withdrew the discretion of bankruptcy judges to determine what expenses were “reasonable” for above-median-income debtors." As such, 11 U.S.C. §707(b)(2)(A)(iii) was unambiguous when it directs that: The debtor’s average monthly payments on account of secured debts shall be calculated as the sum of—(I) the total of all amounts scheduled as contractually due to secured creditors in each month of the 60 months following the date of the filing of the petition . . .. (Emphasis added.) Accordingly, despite the "occasional peculiarity", as Ransom v. FIA Card Servs., N.A., 562 U.S. 61 (2011) described this potential outcome, this deduction was mandated by Congress and it was "not the function of this court to mold its decisions to policy concerns." Commentary: This was one of the last decisions by Judge Stephani Humrickhouse before her retirement and, to the extent that it created a split within the Eastern District case law (and this case has been certified for direct appeal to the 4th Circuit), the consumer bar is grateful, as it is for all of her years of service. For a copy of the opinion, please see: In-re-CookDownload Blog comments Blog tags Means Test Category North Carolina Bankruptcy Cases Eastern District

N.C. Court of App.: Reverse Mortgage Solutions v. Dufault- Inadequate Description of Real Property in Deed of Trust Ed Boltz Sun, 01/23/2022 - 23:01 Summary: Paul and Anita Richardson purchased a 1.26 acre tract of land ("main property") from Old Fort Golf Course in 1962 and then in 1978 purchase two adjacent parcels consisting of 0.181 acres and 0.009 acres ("adjacent properties"). All three parcels had the same mailing address and tax parcel identification number. In 2009, the Richardsons obtained a reverse mortgage in the amount of $297,000 to build a home on the 1.26 acres, but the Deed of Trust only contained a metes and bounds description of the adjacent properties, accompanied by four general descriptions including "a part of those certain lands described in the 1960 Deed conveying over 100 acres to Old Fort Golf Course, "subject to those certain restrictions" recording in the 1978 Deed, known as "the improvements thereon better know as [located at the mailing address], and "BEING all and the same lot of ground which by Deed dated 5 October 1978, and recorded among the Land Record of McDowell County, North Carolina in Liber 278, folio 822 was granted and conveyed by Old Fort Golf Course, Inc." unto the Richardsons. After the deaths of Paul and Anita Richardson, the three properties were left to her daughter Donna Edmisten. Reverse Mortgage Solutions commenced foreclosure in April 2018, conveying the adjacent properties to Reverse Mortgage Solutions. That Deed only included the metes and bounds description for the adjacent properties but did include the mailing address, the description of improvements and the PIN. On July 28,2018, Donna Edmisten conveyed the main property to the Dufaults. In June 2020, Reverse Mortgage Solutions brought an action seeking quiet title against the Dufaults, arguing that the main property was also subject to the Deed of Trust. The trial court dismissed the complaint pursuant to Rule 12(b)(6) and Reverse Mortgage Solutions appealed. The Court of Appeals upheld the dismissal holding that “only when the specific description is ambiguous, or insufficient, or there is a reference to a fuller or more accurate description, that the general description is allowed to control.” Lee v. McDonald, 230 N.C. 517, 521, 53 S.E.2d 845, 848 (1949). It distinguished this case from Bank of America, N.A. v. Schmitt, 263 N.C. App. 19, 20, 823 S.E.2d 396, 397 (2018), where the Schmitts owned two contiguous tracts of land, Tract B and Tract C, with two separate addresses and obtained a construction loan from the bank to build a home on Tract B. There the Deed of Trust was held to attach to Tract B even though it only included a metes and bounds description for Tract C, since the reference to the address to Tract B as well. That was sufficient evidence of the intention that Tract B also be included. Here, however, the four general descriptions in the Deed of Trust were consistent (or at least not ambiguous) with the specific description of the adjacent properties. Commentary: These flawed description cases almost always seem to involve golf courses or reverse mortgages, so this was a double whammy. For reference sake, 0.009 acres is roughly 400 square feet, so the size of a small bathroom For a copy of the opinion, please see: Reverse-Mortgage-Solutions-v.-DufaultDownload Blog comments Blog tags deed of trust Category NC Court of Appeals NC Courts

Bankr. M.D.N.C.: Swink v. Fannie Mae- Actual Damages Sufficient for §524(i), RESPA and FDCPA Claims Ed Boltz Sun, 01/23/2022 - 19:24 Summary: Ms. Swink filed her first Chapter 13 bankruptcy in 2013 and, perhaps unwisely, proposed a plan with her mortgage payment to Fannie Mae being made directly. Twice during that case, Fannie Mae filed Motions for Relief, asserting that Ms. Swink was delinquent on payments, but then in both instances withdrawing those motions after its attorney represented to the court that Ms. Swink had brought her account current. Ms. Swink completed her Chapter 13 case and pursuant to the bankruptcy court's Standing Order at that time, the mortgage account was determined to be current. After the discharge and closing of the bankruptcy case, Fannie Mae commenced foreclosure. Ms. Swink filed a second bankruptcy two days after a foreclosure sale was held (but still within the upset period) This foreclosure also resulted in her homeowner's insurance being cancelled, due to a inaccurate statement by Fannie Mae that the property was no longer owned by Ms. Swink.) Ms. Swink later commenced an Adversary Proceeding against Fannie Mae asserting violation of §524(i), RESPA, Fannie Mae first argued that §524(i) was inapplicable as it was treated as a long-term nondischargeable debt in the first case. The bankruptcy court "easily dispensed" with this argument as § 524(i) is clearly applicable to long-term debts that are not discharged at the end of a bankruptcy plan. See Carnegie v. Nationstar Mortg., LLC (In re Carnegie), 621B.R. 392, 403–409 (Bankr. M.D.N.C. 2020). Further, Fannie Mae attempted to argue that the Proof of Claim, the payment histories and communications between the parties that Ms. Swink asserted showed inaccuracies and errors should be used as the basis for dismissal of the case. The bankruptcy court not only rejected this, as it would invert the standard under 12(b)(6) of viewing the evidence in the light most favorable to the plaintiff, but as the representations by the attorney for Fannie Mae in the first case were binding on it when: (1) Made during a judicial proceeding; (2) Deals with a fact; and (3) Is deliberate, clear, and unambiguous.” See PacNet Capital v. Syke Mineral Partners, LLC (In re Skye Mineral Partners, LLC) (D. Del. Nov. 16, 2020). Further, the bankruptcy court was not persuaded that Fannie Mae, through its servicer Mr. Cooper, corrected any failures under §524(i), when it acknowledge an error and "committed to advancing the account by 10 installments". The same day it made it committed to such, Mr. Cooper submitted an Affidavit in the foreclosure action asserting a continued default. Continuing to Ms. Swink's claims against Fannie Mae for violations of the FDCPA, RESPA, N.C.G.S. § 45, and other common law causes of action, the bankruptcy court held that it did have "related to" jurisdiction under 28 U.S.C. §157(b)(1), as these non-bankruptcy claims arose before the commencement of the current bankruptcy case and accordingly were both assets of the bankruptcy estate and could "conceivably have any effect on the estate being administered in bankruptcy." The bankruptcy court then found that as a result of the purported violations Ms. Swink had asserted actual damages and declined to dismiss those causes of action. Commentary: The present Rule 3002.1 would have avoided much of this, as both Rule 3002.1(c) would have obligated Fannie Mae to disclose asserted fees and charges and Rules 3002.1(f),(g) & (h) would have flushed out any assertion of delinquency at the end of the case or affirmatively and explicitly resulted in an order determining the mortgage to be current. In the present case, Fannie Mae's current counsel argued that the withdrawal of the Motion for Relief was in error as Ms. Swink was delinquent at that time. That withdrawal occurred October 10,2017. When Ms. Swink filed her second bankruptcy on September 27, 2019, Fannie Mae would still have been able to raise a malpractice claim against that attorney. Further, since the two-year Statute of Limitations for malpractice claims must be raised as an affirmative defense, Fannie Mae could still assert such against its earlier attorneys. (That creditors routinely file Proofs of Claim for stale debts, was recognized by the Supreme Court in Midland Funding v. Johnson.) While the idea of "professional courtesy" would seem to preclude that sort of claim, particularly in public, the similar concept of "common decency" on the part of Fannie Mae does not seem to extend to Ms. Swink. For a copy of the opinion, please see: Swink-v.-FNMA-Nationstar-MTD Download Blog comments Blog tags fdcpa mortgage foreclosure mortgage servicer Category North Carolina Bankruptcy Cases Middle District

Summary: Georgia-Pacific Holdings acquired Bestwall Gypsum Company in 1965, but as a result of decades-long asbestos litigation on July 31, 2017, Georgia-Pacific underwent a corporate restructuring, through a “divisional merger” under Texas law by which the old Georgia-Pacific ceased to … W.D.N.C.: In re Bestwall, L.L.C- Injunctive Relief Read More » The post W.D.N.C.: In re Bestwall, L.L.C- Injunctive Relief appeared first on .

W.D.N.C.: In re Bestwall, L.L.C- Injunctive Relief Ed Boltz Sun, 01/23/2022 - 17:16 Summary: Georgia-Pacific Holdings acquired Bestwall Gypsum Company in 1965, but as a result of decades-long asbestos litigation on July 31, 2017, Georgia-Pacific underwent a corporate restructuring, through a "divisional merger" under Texas law by which the old Georgia-Pacific ceased to exist and two new entities were created. (Called the "Texas Two-Step.") These were the new Georgia-Pacific and Bestwall, LLC. Bestwall received certain assets and liabilities, most importantly the liability under the asbestos litigation. Georgia-Pacific did agree to indemnify Bestwall for losses relating to that litigation. Tied to that indemnification was also a secondment agreement by which certain Georgia-Pacific employees with institutional knowledge of the litigation were assigned to work for Bestwall. Bestwall filed for Chapter 11 bankruptcy protection on November 2, 2017, and immediately sought injunctive relief against the asbestos litigants to extend the automatic stay to protect Georgia-Pacific, which the bankruptcy court granted pursuant to 11 U.S.C. §105. The asbestos litigants sought leave to appeal, with the district court agreeing that the injunctive relief was a final appealable order and that the asbestos litigants had standing for that appeal. The district court upheld the subject matter jurisdiction by the bankruptcy court as "related to" under 28 U.S.C. § 1334, as failing to provide the injunctive relief could conceivably affect the bankruptcy estate in the following ways: (1) The purpose of section 524(g) and the Chapter 11 reorganization was to address in one forum all potential asbestos claims; (2) It would distract Bestwall's personnel and impair the ability to reorganize if key personnel would be responsible for the defense of lawsuits against Georgia-Pacific; and (3) The indemnity obligations of Bestwall to Georgia-Pacific of would make judgments against Georgia-Pacific tantamount to judgments against Bestwall, depleting assets available to fund a section 524(g) trust. The district court held that this preliminary injunction was not an abuse of discretion by the bankruptcy court as the standard for such is: (1) likelihood of success on the merits; (2) irreparable harm in the absence of an injunction; (3) the balance of equities; and (4) whether an injunction is in the public interest. Commentary: The argument that Georgia-Pacific should itself instead file bankruptcy is obviously exactly what Georgia-Pacific does not want to do. Instead through this Texas Two-Step, it is able to shield its assets and perhaps as importantly protect its reputation. In the consumer context, this raises the question of whether individuals should be able to similarly divisively merge and create a new corporation holding all of their liabilities, sparing themselves and their credit score from the negative impacts of bankruptcy. That is, of course, ridiculous, since in America corporations are allowed all of the benefits and protections that individuals have, but the converse is never true. The earlier decision by the district court regarding discovery is available at In re Bestwall, L.L.C- Discovery Order is not Final Appealable Order For a copy of the opinion, please see: In-re-BestwallDownload Blog comments Blog tags appeal Category Western District Federal Cases

Bankr. M.D.N.C.: In re Gifford- Severed Tenancy by the Entireties did not become asset of the Estate Ed Boltz Sun, 01/23/2022 - 16:09 Summary: Christopher Gifford and Shana Gifford owned real property as tenants by the entireties. On April 1, 2019, they separated and Christopher filed a complaint for Equitable Distribution. While that was still pending, on August 7, 2020, Christopher filed a Chapter 7, claiming the real property as exempt as tenancy by the entireties. The Trustee obtained an extension of time to object to exemptions until December 17, 2020. On December 1, 2020, Shana Giffords sough relief from the automatic stay to continue the Equitable Distribution action in state court. The Trustee then sought second and third extensions (with Christopher Gifford objecting to the third). The bankruptcy court grantted a final extension until April 7, 2021. No Objection to Exemptions was ever filed. On April 12, 2021, the bankruptcy court approved a settlement between the Trustee and Shana Gifford approving the sale of the property, but reserving the rights of both the Trustee and Christopher Gifford. An Absolute Divorce between Christopher Gifford and Shana Gifford was entered on June 28, 2021. Christopher Gifford then moved the bankruptcy court to determine that the real property was either not part of the bankruptcy estate or that it should be abandoned, as any severance of the tenancy by the entireties occurred more than 180 days after the filing of the petition. The Trustee argued that Christopher Gifford's vested right to an equitable distribution of the real property and the subsequent divorce made Christopher Gifford's interest an asset of the bankruptcy estate. The bankruptcy court held that the termination of the exemption post-petition did not, absent a separate statutory mechanism, bring the new interest in the underlying property into the bankruptcy estate. In re Birney, 200 F.3d 225, 228 (4th Cir. 1999) (citing Cordova, 73 F.3d at 38). The re-capture does not occur by operation of state law and § 541(a)(1) because the interest as a tenant in common is a new interest in property that "did not exist as of the commencement of the case.'"  Bellinger v. Buckley, 577 B.R. 193, 196-99 (D. Md. 2017). While § 541(a)(5)(B) is one statutory mechanism by which certain types of after-acquired interests in property may be brought into the estate, including an interest in property acquired "as a result of . . . an interlocutory or final divorce decree", but only if the debtor acquires or becomes entitled to acquire an interest in the property within 180 days of filing bankruptcy. 11 U.S.C. § 541(a)(5)(B). Here, the divorce decree was entered more than 180 days after Debtor filed bankruptcy. Therefore, Christopher Gifford's new interest in the Property as a tenant in common did not come into the estate under § 541(a)(5)(B). See In re Earls, Case No. 05-53870C-7W, 2006 WL 3150923, *1 n. 2 (Bankr. M.D.N.C. 2006). Christopher Gifford did, however, acquire a vested, but contingent, right to marital property as of the date of the parties separation on April 1, 2019. Even though the state court had not yet ruled on the equitable distribution, allocating specific assets, that right became an asset of the debtor's bankruptcy case upon filing. Should the state court award the real property to the debtor, in part or in full, that would be an asset of the bankruptcy estate, but only available to joint creditors of the debtor and his now ex-wife. Commentary: This shows an interesting gap as the Debtor's interest in marital property was fixed as of the date of separation but the Tenancy the Entireties was not severed until the parties divorced. Not being an expert in family law, it is not clear whether the Chapter 7 Trustee can, on behalf of Christopher Gifford's bankruptcy estate, appear in the state court equitable distribution action to maximize the estates share of the marital property. As the real property is not available for the Debtor's individual creditors, it would seem to be in the interest of the bankruptcy estate to reach a settlement with the Shana Gifford that gave her the real property in exchange for other assets available for all of the Debtor's creditors. Depending on what other marital assets exist, this would certainly have been a case where the Debtor should have filed the bankruptcy either 181 days before separating, waiting to file bankruptcy until the equitable distribution, or filing Chapter 13, as he would remain in control of those assets rather than ceding it to the trustee. For a copy of the opinion, please see: In-re-GiffordDownload Blog comments Category North Carolina Bankruptcy Cases Middle District

A new opinion from the Fifth Circuit shows multiple mishaps in connection with a bankruptcy-related auction. However, its most important holding has to do with authenticating evidence. The bottom line is that a trial court decision limiting a defaulting bidder's damages based on a webpage found on the Wayback Machine was reversed. Weinhoffer v. Davie Shoring, Inc., Case No. 20-30568 (5th Cir. 1/20/22).  You can find the opinion here. What HappenedDavid Weinhoffer was liquidating trustee for Offshore Specialty Fabricators, LLC. He contracted with Henderson Auctions to conduct an online auction. Henderson advertised the auction on its website. However, when bidders clicked on the auction link, they were taken to Proxibid, a third-party website where they could view the terms of the auction and place bids. One of the terms listed on Proxibid was that defaulting bidders would only be liable for 20% of the amount of their bid. Davie Shoring, Inc. did not go through Proxibid. Instead, it called up Henderson and placed the bid by phone. Davie Shoring bid $177,500 for a piece of equipment but decided not to go through with the purchase because it would be too difficult to remove the module from storage.The liquidating trustee sued Davie Shoring to recover the amount of the bid. Davie Shoring insisted that it was only liable for 20% of the amount of its bid. Davie Shoring's principal testified that he read and relied upon the 20% limitation prior to bidding. The company sought to authenticate the evidence through two forms of evidence. First, it introduced a printout from the Proxibid website. The printout was authenticated by Henderson's office manager. The office manager testified that Henderson did not have a copy of the auction terms because the auction was no longer up on its website. Instead, she obtained them from Proxibid when Henderson was subpoenaed. Davie Shoring also introduced a copy of the Proxibid terms and conditions obtained from the Wayback Machine, an online digital archival of web pages.The liquidating trustee objected to the internet evidence as irrelevant, unauthenticated and hearsay. The district judge allowed the evidence in. The district court found that Henderson's office manager had properly authenticated the printout as a custodian of records. The district court also found that it could take judicial notice of the contents of the Wayback Machine because it was a source whose accuracy could not reasonably be questioned under Fed.R.Evid. 201.Based on the terms and conditions, the district court limited the liquidating trustee's recovery to $35,500 plus costs. The liquidating trustee appealed.The RulingThe Fifth Circuit reversed and remanded. It found that Henderson's office manager could only testify as a custodian of records as to its own records. The exhibit came from Proxibid's records, not Henderson's. As a result, Henderson's custodian of records could not authenticate it. "Although a witness need not be a document’s author to authenticate it for purposes of Rule 901, we have observed that a witness attempting to authenticate online content as evidence was unlikely to have the requisite direct knowledge where that content was created and maintained by a third party." Opinion, pp. 4-5. Because Henderson's custodian of records could not authenticate the document, it also could not take the document out of the hearsay rule by authenticating it as a business record. Thus, the printout was doubly inadmissible.The Court also found that it was error to take judicial notice of the Wayback Machine.  There is apparently a body of case law dealing with the Wayback Machine. An opinion from the Federal Circuit found that it could not take judicial notice of a page on the Wayback Machine because the district court had not been asked to take judicial notice. This led several district courts to conclude that they could take judicial notice. Other district courts disagreed, noting that the Wayback Machine itself disclaims any guarantees of accuracy. In another federal circuit decision, a witness properly authenticated a page from the Wayback Machine to show that certain content was publicly known in the context of a patent dispute.The Fifth Circuit found that the Wayback Machine was not so reliable that pages from its archive could not be self-authenticated. Here, there was no testimony to authenticate the archived webpage. Our sister circuits’ decisions that the Wayback Machine is not self-authenticating are persuasive in the context of judicial notice. In sum, the district court erred in taking judicial notice of the terms because a private internet archive falls short of being a source whose accuracy cannot reasonably be questioned as required by Rule 201.Opinion, p. 8. The Fifth Circuit reversed the decision and remanded for further proceedings consistent with the opinion. Presumably, the further proceedings will not include another chance for the defendant to authenticate the evidence. Lessons to Be LearnedThe first important question about this case is one that is not answered by the opinion. Did the trustee know that the company he hired to conduct the auction had out-sourced the auction to a third-party whose terms and conditions contained a damage limitation? There are two possibilities here. One is that the trustee had no idea that this limitation existed and was shocked when the bidder tried to limit his liability. The other is that the trustee knew all along and was willing to let his attorneys take an opportunistic position hoping that the other side couldn't get the evidenced authenticated. However, if the trustee knew about the limitation, the bidder could simply have gotten the evidence from the trustee. The fact that it had to go to other sources strongly suggests that the trustee was not aware of this limitation and didn't agree to it. This suggests that trustees conducting online auctions should do their due diligence to know the mechanics of how the auction will be conducted and whether a third-party will be posting the terms and conditions of the sale. Had the bidder properly authenticated the terms and conditions, the small judgment would have been upheld. Henderson was the authorized agent of the trustee and Proxibid was the authorized agent of Henderson. Therefore, the trustee could have been held to the admissions of its agent once removed. The second lesson is that just because something is on the internet does not make it admissible. If I write on my Facebook page that Leif Clark was in Norway on a certain date, that post could be used as a party admission against me (although I have no idea why anyone would care). However, it could not be introduced into evidence against Leif since that would be hearsay. Instead, you would have to go to find Leif's own posting about his latest trip to Norway and then authenticate it. That could be done by asking Leif if that was his post or by having a witness from Facebook testify that the posting accurately reflected a statement posted from Leif Clark's Facebook account. For those wanting to authenticate pages from the Wayback Machine, the Fifth Circuit helpfully points out that  The Wayback Machine’s “Using The Wayback Machine” webpage instructs users on how to request affidavits to authenticate Wayback Machine pages as “certified records for use in legal proceedings.” See Internet Archive, Using the Wayback Machine, http://help.archive.org/hc/en-us/articles/360004651732-Using-The-Wayback-Machine (last visited January 20, 2022).Opinion, n. 22.The final lesson is that this opinion illustrates why counsel should get stipulations on the admissibility of evidence prior to trial so that you know in advance which exhibits may be problematic.   

 https://www.bankrate.com/finance/credit-cards/how-long-after-bankruptcy-credit-card/

 https://www.reuters.com/world/us/upside-down-again-omicron-surge-roils-us-small-businesses-2022-01-16/

A Breakdown of the Bankruptcy Petition What is a bankruptcy petition, exactly? Find out from noted Philadelphia bankruptcy attorney David M. Offen what a bankruptcy petition is and how it works in the bankruptcy process. If you are researching bankruptcy petitions online, you are likely considering filing bankruptcy and want to know more about it. An educated debtor is a successful debtor. Find out even more about your options considering your unique financial situation by scheduling your free, no-obligation consultation with the Law Offices of David M. Offen. Call (215) 625-9600   and let us help you get free of bills. Bankruptcy Petition Definition The bankruptcy petition is the first form in a package of forms you must file in order to open your bankruptcy case. The information you disclose on your petition introduces you to the court and the Trustee. In your petition, you set forth identifying information, the identity of your co-debtor if you have one, your address, what Chapter you intend to file under, and general information about your financial situation. You will file many other forms with your petition when you file bankruptcy, and the entire filing may also be referred to as “the petition” or “the petition and schedules.”  On your Schedules, you disclose your income, assets, expenses, and debts, and co-debtors, and swear to the best of your knowledge that the information you’ve disclosed is true and correct to the best of your knowledge.  You also complete forms attesting that your social security number is correct, a statistical summary of your assets and liabilities, and certifications that you completed your credit counseling course, and later in your case, the financial management course, also called the debtor education course. Last, you complete your Statement of Financial Affairs. If you have a lawyer filing for you, the attorney will put together the paperwork for you based on the information you provide.  You then sign that the information is true and correct to the best of your knowledge. Chapter 7 Bankruptcy & Chapter 13 Bankruptcy Chapter 7 bankruptcy is a four- to six-month process during which you disclose your income, assets, expenses, and debts to the court and receive a discharge of your unsecured debt. You must pass the Chapter 7 means test in order to income qualify to file under Chapter 7. In other words, if you complete the means test and find that you have disposable income, you must file under Chapter 13, except in certain circumstances such as where you were just laid off from a high paying job, no longer have the same income and you need bankruptcy relief right away. Forms specific to Chapter 7 bankruptcy include: Chapter 7 Means TestStatement of Intention (how you intend to deal with your secured debt)Statement of Current Monthly IncomeStatement of Exemption from Presumption of Abuse  A Chapter 7 debtor may also need to file: Application to Pay the Filing Fee in InstallmentsApplication to Have the Filing Fee WaivedStatement about an Eviction JudgmentForms requesting Mortgage Modification (vary by jurisdiction) Chapter 13 bankruptcy is a three- to five-year process and works much the same way as a Chapter 7 filing except a Chapter 13 debtor pays Chapter 13 plan payments each month to the Trustee, who distributes the payments to the debtor’s creditors. Chapter 13 debtors often use Chapter 13 to catch up with past-due payments on their mortgage, car loan or lease, support obligation, student loan obligation, or obligation to pay taxes or government fines or fees. Forms specific to Chapter 13 bankruptcy include: Your proposed Chapter 13 planStatement of Current Monthly Income and Calculation of Commitment PeriodCalculation of Your Disposable Income All debtors are required to provide a list of creditors. These can include credit card lenders, medical providers for unpaid medical bills, holders of deficiency judgments, domestic support obligees such as a child support obligee or an alimony obligee, mortgage lenders, car lenders, car lessors, personal loan lenders, landlords for unpaid rent, second mortgage or HELOC lenders, tax lien holders, the IRS for unpaid income tax, student loan lenders, and the state or federal government. Even if the statute of limitations for debt collection in PA has passed, you should list those creditors. Types of Bankruptcy Petitions Voluntary Bankruptcy Petition for Individuals Most bankruptcy petitions are filed by debtors voluntarily using Official Form 101. Voluntary Bankruptcy Petition for Non-Individuals Businesses or organizations filing bankruptcy use Official Form 201 as their petition. Involuntary Bankruptcy Petition for Individuals Occasionally a creditor forces someone into bankruptcy. Those filing bankruptcy against an individual use Official Form 105 as their petition. Involuntary Bankruptcy Petition for Non-Individuals If a group of creditors wish to force a business or organization into bankruptcy, they will use Official Form 205 as their petition. Requirements of Bankruptcy Petitions Individual debtors filing voluntarily or married individuals filing jointly must disclose: Your legal name and any other names you have used in the last eight years;Your spouse’s legal name and any other names they used in the last eight years, if you are filing a joint petition;The last four digits of your social security number(s);Any business name or Employer Identification Numbers you have used in the last eight years;Your address;The Chapter of bankruptcy you are filing under;How you intend to pay the filing fee, or if you need installment payments or a fee waiver;Whether you have filed bankruptcy in the last eight years;Whether you spouse or business partner has a pending bankruptcy case;Whether you own a business as a sole proprietor;Whether you are filing under Chapter 11 and are a small business debtor;Whether you possess anything that is hazardous;Whether you have been briefed about taking your credit counseling course;Whether your debts are primarily consumer or business debts;Whether you are filing Chapter 7 and have non exempt assets;An estimate of the number of creditors you owe;An estimate of the worth of your assets;An estimate of the total amount of your debt;Your signature “under penalty of perjury;”Whether an attorney or a petition preparer helped you prepare the petition. Be aware that your signature is a sworn statement that everything you’ve disclosed on your petition is true and correct to the best of your knowledge. If you lie on your petition, you have committed perjury, and you may have to pay fines of up to $250,000, face up to 20 years of imprisonment, or both. Just be sure to try to accurately answer any questions that your lawyer asks you. What Happens After Filing a Bankruptcy Petition Once you have filed your bankruptcy petition and schedules, your case will be assigned a docket number and your creditors will be mailed or emailed a notice that you filed, the deadline to object to discharge, and the date of the first scheduled 341(a) Meeting of Creditors. If you have not done so already, you must complete your credit counseling course and provide your attorney with the certification of completion, which your attorney will file. You must also take a financial management course, also called the debtor education course, and have your attorney file that certification of completion. 341(a) Meeting of Creditors The purpose of the 341(a) Meeting of Creditors is not only to give your creditors the opportunity to question you about the debt you owe. The Meeting of Creditors allows the Trustee to verify your identity and ask any questions they have about your filing. In most cases, the creditors do not show up to the meeting of creditors. Your attorney will know if any creditors intend to appear, and will prepare you for the Trustee’s questions. How an Experienced Bankruptcy Attorney Helps Regardless of what Chapter you are filing under, an attorney guides you through the process or completing your bankruptcy petition so that you make no mistakes that could be construed as bankruptcy fraud. Also, an experienced bankruptcy attorney will ensure that the process goes very smoothly, that you attain your financial goal through your bankruptcy filing, and that there are no surprises or unintended consequences from your filing. Call The Law Offices of David M. Offen today at (215) 625-9600 to take advantage of the opportunity to talk with an experienced bankruptcy attorney about your particular financial situation, concerns, and goals – free of charge! Let us help you get a fresh financial start. The post A Breakdown of the Bankruptcy Petition appeared first on David M. Offen, Attorney at Law.