Reuters reports that the debt limit for Subchapter V Bankruptcy for small businesses, initially set at $2.7 million, was temporarily raised to $7.5 million by the Coronavirus Aid, Relief, and Economic Security Act passed in 2020. However, this limit has now reverted to $2.7 million following the expiration of the Coronavirus Aid law on Friday, June 21, 2024..  The story can be found at https://www.reuters.com/legal/government/small-business-bankruptcy-rules-get-tighter-after-us-law-expiration-2024-06-21/The reduced debt limit will reduce the number of small business that can file for SubV Bankruptcy. Hopefully lawmakers will increase the debt limit in the future. People or businesses with questionings about Subchapter V should contact Jim Shenwick, Esq.Jim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

As a homeowner, foreclosure is likely high on your list of things to avoid. Unfortunately, many homeowners fall behind on mortgage payments and must face the prospect of foreclosure. Rest assured, creditors cannot foreclose if specific legal criteria are not satisfied. Creditors may not initiate foreclosure unless certain criteria are met, including the number of months you are behind on your mortgage. Under federal law, creditors cannot foreclose until you are at least 120 days behind. Even then, foreclosure is not guaranteed, and creditors might be willing to work with you. How quickly creditors decide to start the foreclosure and what we can do about it may vary based on your unique situation. Foreclosure usually begins with a formal notice from the bank. If notice is not provided, the bank should not be able to move forward with the foreclosure. If you have received such notice or believe notice is forthcoming, talk to our team immediately. Contact our Pennsylvania mortgage foreclosure defense attorneys for a free, confidential case evaluation by calling Young, Marr, Mallis & Associates at (215) 701-6519. How Far Behind on Mortgage Payments You Must Be Before Foreclosure in Pennsylvania Missing a single mortgage payment is not enough for the bank to suddenly foreclose on your home. Missing even two or three payments likely is not enough. According to federal law 12 C.F.R. § 1024.41(f)(1), a creditor may not initiate foreclosure proceedings until you are at least 120 days delinquent, or about 4 months. Talk to our Philadelphia mortgage foreclosure defense attorneys if you are behind on payments but not far enough behind to trigger foreclosure proceedings. If the bank tries to foreclose when it should not, we can help you fight the foreclosure and hopefully keep your home. We can also help you check the terms of your mortgage. Other terms, conditions, or restrictions might play into the foreclosure process. Remember, not all mortgages are exactly the same, and your legal options might depend on the terms of your mortgage. How Quickly May Creditors Foreclose in Pennsylvania? Just how fast a creditor may foreclose on your home depends on a wide variety of circumstances and factors. While they are legally permitted to initiate foreclosure proceedings after 4 months of delinquency, they do not have to. You might be surprised to learn that many creditors are willing to work with delinquent borrowers to avoid foreclosure. They would much rather help you get back on track so you can continue making payments. Remember, creditors only want to be paid. Is there a way to convince the bank to hold off on foreclosure? How far behind are you? If you are delinquent on your mortgage payments for at least 4 months but the delinquency is not a lot of money, the bank might be more willing to work with you. For example, if you only need a few thousand dollars to catch up on delinquent payments, you might be able to get a loan from friends or family members so you can keep your home. Alternatively, the bank might agree to adjust your monthly payments so you can catch up. If the delinquency represents a much larger sum of money, the bank might be far less willing to reach an agreement or compromise. Even so, we might convince them to adjust the terms of your mortgage. For example, if you can pay a larger sum up front to partially catch up on missed payments, the bank might agree to lower your monthly payments to something you can afford. How Does Foreclosure Start in Pennsylvania? A foreclosure must begin with a formal notice from the creditor. This notice is not just a courtesy from the bank informing you of its plan to foreclose. It is legally required and must contain specific information about the foreclosure and your options going forward. If you have received a notice like this recently, call our team for help immediately. The notice may give you some time, usually about 30 days, to remedy the delinquency. If you cannot catch up during that time, the bank may proceed with the foreclosure. Since Pennsylvania is a judicial foreclosure state, the bank would have to sue you in court to foreclose. Because judicial foreclosure requires court approval at every step of the way, it often takes longer than in non-judicial foreclosure states. As such, you might have extra time to get your finances in order. You might also have more opportunities to fight the foreclosure in front of a judge. How to Fight Foreclosure if You Default on Your Mortgage in Pennsylvania If you are in foreclosure or falling behind on your mortgage and believe foreclosure is in your future, talk to our team about how you can fight the foreclosure and hopefully keep your house. One method is to negotiate with the bank. Remember, the bank wants to get paid at the end of the day. Creditors would often much rather help you get back onto a payment schedule than foreclose. We might convince the bank to adjust the terms of your mortgage so that you can make more affordable payments while also catching up on the payments you missed. Depending on the situation, we might be able to challenge the foreclosure in court. If the bank tries to foreclose too soon or refuses to allow you to cure the default, we can raise the issue in court. You have a right to cure the default under 41 Pa. Sta. § 404(a). Curing the default means paying enough money to catch up on all your missed payments and various legal fees and late penalties. While it is tough to accomplish, you have a right to cure the default if you have the money, and the bank cannot stop you from doing so. Contact Our Pennsylvania Mortgage Foreclosure Defense Lawyers for Support Contact our Upper Darby, PA mortgage foreclosure defense attorneys for a free, confidential case evaluation by calling Young, Marr, Mallis & Associates at (215) 701-6519.

Law Review: Joseph Peter Gomez, Note, A Bona Fide Dispute: Can Bankrupt Debtors Sell Assets Free and Clear of Federal Civil Forfeiture Claims?, 29 Fordham J. Corp. & Fin. L. 587 (2024). Ed Boltz Fri, 06/21/2024 - 21:14 Available at:  https://ir.lawnet.fordham.edu/jcfl/vol29/iss2/4/ Abstract: Auctions are wheeling-dealing extravaganzas in which frenzies of bidders fight over shiny objects. What would happen if the government busted down the doors of the auction house, took the shiny objects, and sold them online? An asset sale through section 363(b) of the Bankruptcy Code provides a court-supervised opportunity to maximize economic value for the bankruptcy estate. To sell estate assets, the debtor must either (1) pay off each creditor holding an interest in the assets or (2) strip the creditor’s interest and attach it to the proceeds of the sale. When the government asserts a civil forfeiture claim against the asset being sold, it argues that its claim has superpriority over every other interest. If the debtor chooses option one, the government might demand the debtor pay up, or else it will seize the assets, leaving the debtor and its creditors with nothing. A debtor, naturally, might wish to choose option two: strip the government’s forfeiture interest from the asset and attach it to the sale proceeds. This Note examines the unique aspects of civil forfeiture claims and how those aspects conflict with asset sales through section 363(b). It identifies case law across jurisdictions to assist courts asked to determine whether to strip a civil forfeiture claim from assets sold through section 363(b). It proposes a three-step framework for courts to apply in analyzing this issue. Finally, this Note argues that bankruptcy courts should allow sales of assets free and clear of a federal civil-forfeiture interest if the interest is in bona fide dispute and the government’s interest can be adequately protected by attaching it to the sale proceeds. Commentary: 363 sales are certainly much more rare in consumer cases,  particularly  for Chapter 13  debtors- largely because unlike with commercial loans might  have an interest in helping the corporate debtor retain assets against other creditors,  where consumer lenders basically will cut off their own nose to spite the consumer debtor's  face-       This article could,  however,  offer a possible solution for debtors  facing the loss of assets resulting  from  drug asset forfeiture from co-owners (or even just adult children that reside in a home). With proper attribution,  please share this post.   To read a copy of the transcript, please see: Blog comments Attachment Document a_bona_fide_dispute_can_bankrupt_debtors_sell_assets_free_and_cl_compressed.pdf (495.46 KB) Category Law Reviews & Studies

People often spend years paying off mortgages, and their financial situation might change quite a bit during this time. If you find yourself unable to keep up with payments, talk to a lawyer about how to avoid foreclosure. One way of preventing foreclosure is to file for bankruptcy. While bankruptcy is not exactly an ideal solution, it might be a solution, nonetheless. Through bankruptcy, you might liquidate other assets to cure the default on your mortgage. You might instead devise a payment plan to help you catch up on numerous debts, including your mortgage. There might be alternative ways to prevent home foreclosure. You might sell the house and use the proceeds to repay the mortgage. You might instead work out an agreement with the bank or other creditors to buy extra time to get your finances in order. Perhaps the best thing you can do is to speak to a lawyer about your options. Your attorney might even help you challenge the foreclosure in court, as New Jersey is a judicial foreclosure state. Please ask our New Jersey mortgage foreclosure defense lawyers for a free review of your case by calling Young, Marr, Mallis & Associates at (609) 755-3115. Filing for Bankruptcy to Avoid a Home Foreclosure in New Jersey While most homeowners want to avoid foreclosure, they might think of bankruptcy as their way out. Most people consider bankruptcy to be the option of last resort. While it certainly comes with some drawbacks, bankruptcy might be the solution you are looking for. In some cases, it can help people avoid foreclosure. Chapter 7 Bankruptcy One option is to file for bankruptcy under Chapter 7, a common option for individuals with fewer assets. Under Chapter 7, a bankruptcy trustee may liquidate your assets to pay off your debts. In some cases, this might mean losing your home. However, the liquidation of your home avoids the foreclosure process. Depending on how things go, the money you get from your home might cover your mortgage and various other debts, allowing you to start over with a clean financial slate. If you have other assets you want to liquidate first in the hopes of keeping your home, talk to your attorney. Coordinating with the bankruptcy trustee might be possible so that other assets you do not mind parting with are liquidated instead of your home. This might be feasible if you have valuable assets like a vacation home or vehicles you do not need. You might also claim the federal homestead exemption under 11 U.S.C. § 522(d)(1), which may exempt up to $27,900 in your home’s equity. Chapter 13 Bankruptcy Chapter 13 bankruptcy works much differently than Chapter 7. Instead of liquidating assets and properties and potentially losing your home to bankruptcy rather than foreclosure, you might not have to liquidate anything. Instead, you and our Trenton, NJ mortgage foreclosure defense lawyers must come up with a payment plan to help you get back on the right financial track. Payment plans should be aggressive yet financially feasible. As such, people on Chapter 13 payment plans have very little wiggle room for superfluous or luxury purchases. Also, many people must spend quite some time on their payment plans. Many bankruptcy petitioners spend about 3 to 5 years adhering to their plans before their case is complete. Other Ways to Prevent Home Foreclosure in New Jersey If bankruptcy is not something you are ready to consider, your lawyer can help you explore other legal options for avoiding foreclosure. Some options might involve more formal legal procedures, while others involve informal agreements with creditors and lenders. Our team can help you figure out something that works for you. Selling the House One option is to sell your home and downsize. While you might have had plans to stay in your home for many years to come, it might not be financially possible. Rather than lose your home to foreclosure, you can instead quickly sell your home, use the proceeds to pay off your mortgage and clear your debt, and put any remaining money toward a different, more affordable home. While you cannot keep your home in this scenario, you may avoid foreclosure, which might save your credit so you can buy a more affordable home later. Talk to your attorney. It might be a wiser idea to cut your losses, avoid a massive hit to your credit, and begin planning for a different home in the future. Working Out Agreements with Creditors Talk to your attorney about how much money you owe toward your mortgage and how far behind you are on payments. It might be possible to work out some sort of deal with your creditors to avoid foreclosure. Creditors just want to be paid at the end of the day. If we can pay something now, we might convince creditors to delay foreclosure. Is there a way we can negotiate with creditors to make your payments more affordable? Maybe your creditors will agree to work out a new monthly payment that is more affordable. However, there might be some trade-offs, and you might have higher interest rates. Are you expecting a financial windfall in the near future? If we explain the situation to your creditors, they might hold off on the foreclosure until your money comes in. For example, maybe a family member just passed away, and you are expecting a large inheritance. Explaining this to your creditors might persuade them to hold off on foreclosure until your inheritance comes in. Remember, creditors just want to be paid. Challenging the Foreclosure in the New Jersey Courts Since New Jersey is a judicial foreclosure state, we might be able to challenge the foreclosure in court if there are no other ways of avoiding it. There might be numerous grounds on which to challenge the foreclosure. For example, according to 12 C.F.R. § 1024.41(f)(1), creditors may not foreclose until you are no less than 120 days behind on payments. Tell your attorney if you are not far enough behind for creditors to begin the foreclosure process. It is possible that your creditors made a clerical error and jumped the gun on the foreclosure. It is also possible they are using underhanded tactics to get you out of your house. You also have a right to cure the default, according to N.J.S.A. § 2A:50-57(a). This means that if you can come up with the money to cover your debts and various other costs before the sale of your home, you may keep your house and avoid foreclosure. Speak to Our New Jersey Mortgage Foreclosure Defense Attorneys Today Please ask our Union City, NJ mortgage foreclosure defense lawyers for a free review of your case by calling Young, Marr, Mallis & Associates at (609) 755-3115.

The Business Journals is reporting that SBA Loans have created a wave of bankruptcy filing.  The story can be found at https://www.bizjournals.com/charlotte/bizwomen/news/latest-news/2024/06/sba-covid-eidl-loan-bankruptcy-congress-banks.htmlJim Shenwick, Esq  917 363 3391  [email protected] Please click the link to schedule a telephone call with me.https://calendly.com/james-shenwick/15minWe held individuals & businesses with too much debt!

Bankr. E.D.N.C.- In re Goddard- Denial of Confirmation due to Good Faith without regard for Means Test Ed Boltz Tue, 06/18/2024 - 20:03 Summary: Disregarding (with gratuitous  scorn) a long standing case law from its own jurisdiction,  including In re Alexander, 344 B.R. 742, 752 (Bankr. E.D.N.C. 2006),  the bankruptcy court held that even when the "mechanical requirements" of the Means Test at §1325(b)  do not mandate a dividend to unsecured creditors,  the "good faith"  obligations of  11 U.S.C. § 1325(a)(3)  precluded the debtor from retaining "luxury items"  while only providing a "meager projected dividend to general unsecured creditors when no dividend is required under  the disposable income test," Commentary: Hopefully,  as the bankruptcy court not only disregards Alexander,  but at best gives short shrift to Mort Ranta v. Gorman, 721 F.3d 241, 253 n.15 (4th Cir. 2013)  and Bledsoe v. Cook, 70 F.4th 746, 748 (4th Cir. 2023),  it and the Fourth Circuit will allow an interlocutory appeal.  Otherwise,  as Bullard v.  Blue Hills Bank prohibits the appeal of the denial of confirmation,  consumer debtors will be unable to safely and seek review of whether a "good faith"  analysis can relegate the Means Test to meaninglessness.   To read a copy of the transcript, please see: Blog comments Attachment Document in_re_goddard.pdf (149.29 KB) Category Eastern District

SCOTUS: UST v. John Q. Hammons- Remedy for Violation of the Bankruptcy Uniformity Clause Ed Boltz Tue, 06/18/2024 - 19:05 Summary: In the follow up to Siegel v. Fitzgerald, 596 U. S. 464,  where the Supreme Court found that  the disparity in bankruptcy fees between Chapter 11 debtors in U.S. Trustee districts and those in Bankruptcy Administrator districts violated the Bankruptcy Clause's uniformity requirement.,  here the Supreme Court addressed the remedy for that violation. The appropriate remedy was to require equal fees for all Chapter 11 debtors going forward (prospective parity), aligning with congressional intent and correcting the constitutional issue and that a refund (estimated $326 million burden on taxpayers)  was not due to those Chapter 11 debtors. Justice Gorsuch, joined by Justices Thomas and Barrett, dissented,  criticizing the majority for focusing on what Congress might have done to fix the issue prospectively, rather than addressing the past harm., and  contending that the majority's approach left the injured parties without adequate relief. Commentary: It would be  interesting to consider how these opinions might be shuffled  if,  instead of a constitutional  violation of the requirement of "uniform Laws on the subject of Bankruptcies"  this was a case of constitutional violations of the "equal protection"  clause of the 14th Amendment. Perhaps the majority could distinguish sufficiency of merely  prospective relief  based on whether the violation was  a "short-lived and small disparity",  but it would seem that Justice Gorsuch's  dissent could be used as a strong argument for reparations as an appropriate and even necessary remedy for any constitutional violation. But nobody else reads SCOTUS bankruptcy opinions anyways.   To read a copy of the transcript, please see: Blog comments Attachment Document ust_v._john_q._hammons.pdf (231.77 KB) Category Law Reviews & Studies

The real non mortgage expenses of home ownership are nothing like the means test allowances provided. Bankruptcy lawyers need to rise to the challenge of aligning the means test with today’s economic and legal realities. The success of bankruptcy cases may turn on it. What the means test allows The means test provision for non-rent/mortgage […] The post Re-examining The Means Test Cost of Home Ownership appeared first on Bankruptcy Mastery.

MDNC BK: In re Beverly- Reopening of a Case to Avoid Judgment Lien Ed Boltz Thu, 06/13/2024 - 16:26 Summary: Michael Vincent Beverley filed for Chapter 7 bankruptcy on May 24, 2019,   disclosing In his petition his ownership of  real property located at 6680 Ridge Bluff Drive, Rural Hall, North Carolina, valued at $208,000, encumbered by a deed of trust and several judgment liens, including to BMO Harris Bank..  Mr.  Beverley  received a discharge on August 29, 2019, and the case was closed on September 9, 2019, but without filing motions to avoid judicial liens. Subsequently,  BMO Harris Bank assigned the judgment to Guaranty Solutions Recovery Fund 1, LLC in July 2023, which pursued collection on the judgment against Mr. Beverley's  homestead,  including sending Mr.  Beverley a Notice of Right to Have Exemptions Designated. In response,  Mr. Beverley sought to have his original attorney  reopen the case to avoid this judgment lien,  but as that lawyer was retiring,  Mr.  Beverley hobtain new representation and filed that motion on on January 4, 2024.    Guaranty Solutions Recovery Fund 1  objected, citing unfair prejudice due to the time elapsed and expenses incurred. First the bankruptcy court held that reopening a case under 11 U.S.C. § 350(b) is discretionary and requires cause, such as avoiding judicial liens, which can provide relief to the Debtor. Then that the late avoidance of judicial liens "incorporates an equitable defense akin to laches" which  would prohibit the avoidance  if the creditor can show both a: Lack of diligence by the party against whom the defense is asserted; and  Prejudice to the party asserting the defense.”  Miller v. Hooks, 749 Fed. Appx. 154, 161 (4th Cir. 2018). Here the bankruptcy court found that  the delay substantial but not insurmountable, as the prejudice caused was monetary and curable by requiring Mr.  Beverley to  reimburse  Guaranty Solutions Recovery Fund 1  for its reasonable attorney’s fees and costs incurred due to the delay.  Further,  if Guaranty Solutions Recovery Fund 1 desired a retrospective appraisal  of the property to determine the value of the real property as of 2019,  when the case was filed,  Mr. Beverley would bear those costs as well. Commentary: This  decision does strike a fair balance in allowing debtors to avoid judgment liens,  which often go unnoticed especially as the three major credit reporting agencies no long list those.  (Although debtors attorneys should be getting judgment searches elsewhere- whether WestLaw,  Castle Branch or some other source). The balance is that the debtor is liable for any reasonable costs incurred by the judgment creditor in the time since discharge,  including  for a retroactive appraisal. To read a copy of the transcript, please see: Blog comments Attachment Document beverley_19-50528_-_order_reopening_case.pdf (589.19 KB) Category Middle District

4th Cir.: Todman v. Baltimore- Abandonment of Personal Property Following Eviction Ed Boltz Wed, 06/12/2024 - 22:21 Summary: Marshall and Tiffany Todman, tenants in Baltimore, were evicted and lost their belongings under Baltimore’s Abandonment Ordinance, which deems any property left behind at eviction as abandoned. The Todmans sued the City of Baltimore, alleging violations of their Fourteenth Amendment rights to due process,  asserting that they were deprived of their property without adequate notice and opportunity to be heard. The Court of Appeals,  relying primarily  on the SCOTUS bankruptcy decision in Tyler v. Hennepin County, 598 U.S. 631 (2023),  held that "when operation of a confiscatory statute is triggered by something other than long periods of nonuse, it starts to look less like abandonment and more like a government-induced forfeiture."   The Abandonment Ordinance, as applied, failed to provide sufficient notice or opportunity to contest the abandonment, was confusing, buried among other information, and did not clearly inform the Todmans of the risk of abandonment.  Further, the lack of a reclamation period further deprived the Todmans of a meaningful opportunity to reclaim their property. This resulted in the court affirming the district court’s finding that Baltimore was responsible for the due process violation since  the Abandonment Ordinance, a municipal policy, directly caused the deprivation of the Todmans’ property.  That Baltimore  did not control the eviction process was not relevant as the ordinance directly made Baltimore  responsible for ensuring the ordinance complied with constitutional requirements.  These violations,  accordingly,  subjected Baltimore to damages under § 1983. Commentary: Not only is this an expansion of a bankruptcy decision from the SCOTUS  into non-bankruptcy areas,  it points out the breadth and scope that  Tyler v. Hennepin County has.  This raises further possibilities that the disposition of personal property following a foreclosure by  government sponsored entities (GS Es)  such as Fannie Mae or Freddie Mac must also comply with due process or risk similar § 1983 being asserted.  That a property owner has rights following the loss of possession of a residence,  whether rented or owned,  now seems to require notice and disclosure of those rights in clear language,  separate from the actions,  whether eviction or foreclosure,  to take possession of the residence. Blog comments Category 4th Circuit Court of Appeals