Often is the case when a proposed debtor is not sure who all the creditors are. Even when credit reports are pulled, since not all debts may be reported, not all creditors may be listed.
Well, the Bankruptcy Code, under Sect. 523(a)(3) provides, among many other things, that a discharge does not 'discharge' an individual debtor from any debt neither listed nor scheduled in time to permit the timely filing of a proof of claim or actual knowledge of the case in time for such timely filing.
What does this mean? The main thing it means, is that if a creditor is not listed in your schedules within the proper time limit, the debt to that creditor will probably not be discharged, so the creditor can again attempt to collect it just as though the bankruptcy case had not been filed.
You are required to list all your debts and creditors. You are not doing yourself a favor by leaving one out.
Contact the office of Lee Norton Bain, Attorney-at-Law to get your bankruptcy questions answered.
Monday, December 12, 2011
Wednesday, October 12, 2011
FTC Halts Mortgage Relief Schemes
In its September 29th edition, Consumer Bankruptcy News reports that as part of an ongoing effort to stop mortgage relief scams, the Federal Trade Commission put an end to three schemes that claimed to help consumers with their mortgage and debt problems. Each of the defendants - Truman Foreclosure Assistance LLC, Fedmortgageloans.com and Making Home Affordable - allegedly claimed a bogus affiliation with government assistance programs.
The FTC's complaint against Truman Foreclosure Assistance and several individuals was filed as part of a 2009 law enforcement sweep called 'Operation Stolen Hope'. Falsely claiming that it could get most mortgages modified or stop foreclosure, Truman allegedly charged homeowners up-front fees from $1,500 to $3,000. Truman touted a 90-percent success rate and a 100-percent money-back guarantee. However, in many instances, after consumers paid the up-front fees, Truman failed to provide information about the status of their communication with the consumers' lenders; failed to contact the consumers' lenders or obtain mortgage loan modifications; and denied refunds to homeowners for whom they failed to obtain modifications, according to the FTC.
Fedmortgageloans.com was accused by the FTC of marketing debt relief services as well as mortgage assistance relief services. In June 2010, the FTC charged two corporate defendants and two individuals with misrepresenting that the mortgage assistance and debt relief programs they marketed online were affiliated with the federal or state government, and that consumers were eligible for a federal or state government loan modification or debt relief program. According to the complaint, the defendants used www.fedmortgageloans.com, www.fedhomeaffordableplan.com and various other websites to market loan modification services, often displaying official government agency seals or logos and links to the websites of federal government agencies such as HUD, the U.S. Treasury Department and the White House. Likewise, multiple sites operated by the defendants promoting debt relief services featured federal or state government logos and seals. Consumers who provided basic information on any of the sites were all assured that they qualified for mortgage assistance or debt relief programs.
In its May 2009 complaint against Making Home Affordable, the FTC alleged that the defendants impersonated MakingHomeAffordable.gov. According to the FTC, consumers looking for the federal Making Home Affordable program were diverted to commercial websites that pitched loan modification services or sold consumers' personal information to marketers that did.
The FTC's complaint against Truman Foreclosure Assistance and several individuals was filed as part of a 2009 law enforcement sweep called 'Operation Stolen Hope'. Falsely claiming that it could get most mortgages modified or stop foreclosure, Truman allegedly charged homeowners up-front fees from $1,500 to $3,000. Truman touted a 90-percent success rate and a 100-percent money-back guarantee. However, in many instances, after consumers paid the up-front fees, Truman failed to provide information about the status of their communication with the consumers' lenders; failed to contact the consumers' lenders or obtain mortgage loan modifications; and denied refunds to homeowners for whom they failed to obtain modifications, according to the FTC.
Fedmortgageloans.com was accused by the FTC of marketing debt relief services as well as mortgage assistance relief services. In June 2010, the FTC charged two corporate defendants and two individuals with misrepresenting that the mortgage assistance and debt relief programs they marketed online were affiliated with the federal or state government, and that consumers were eligible for a federal or state government loan modification or debt relief program. According to the complaint, the defendants used www.fedmortgageloans.com, www.fedhomeaffordableplan.com and various other websites to market loan modification services, often displaying official government agency seals or logos and links to the websites of federal government agencies such as HUD, the U.S. Treasury Department and the White House. Likewise, multiple sites operated by the defendants promoting debt relief services featured federal or state government logos and seals. Consumers who provided basic information on any of the sites were all assured that they qualified for mortgage assistance or debt relief programs.
In its May 2009 complaint against Making Home Affordable, the FTC alleged that the defendants impersonated MakingHomeAffordable.gov. According to the FTC, consumers looking for the federal Making Home Affordable program were diverted to commercial websites that pitched loan modification services or sold consumers' personal information to marketers that did.
Thursday, September 15, 2011
Foreclosure Crisis
The September 1, 2011 edition of Consumer Bankruptcy News, reports that Senators press mortgage servicers about their proofs of claim processes.
Eleven of the nations's leading mortgage service companies recently received a letter asking for clarification of their policies and procedures regarding mortgage foreclosures as they relate to the filing of proofs of claim and motions for relief from stay in bankruptcy cases. The letter was signed by Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., and Committee Member Richard Blumenthal, D-Conn.
"Evidence has been mounting for some time that loan servicing institutions are unprepared to deal adequately with the complexity of the [foreclosure] crisis in a fair and equitable manner that is consistent for all homeowners. Fraudulent and faulty documents filed in state and bankruptcy courts to facilitate foreclosures have trigered several investigations, including inquiries by federal regulators and state attorneys general, but the problem remains widespread. Clifford J. White, III, director of the Executive Office for the United States Trustee, recently stated publicly that an investigation by his office has revealed that the rate of obvious, facial errors in proofs of claim in the bankruptcy courts may be 10 times higher than previously disclosed. This is a shocking and disappointing statistic, but consistent with what bankruptcy judges, attorneys and homeowners have been experiencing for some time," the letter states.
In a statement, Leahy expressed concern "that homeowers who are compelled to turn to the bankruptcy process far too often face serious misconduct by mortgage servicers. We need a full understanding of the mortgage servicing policies and practices at the heart of these problems. We have a responsibility to ensure that Americans are protected from fraud and other misconduct when they seek relief in our federal bankruptcy courts."
Blumenthal observed that the "ongoing abuses and fraudulent practices by mortgage servicers are needlessly forcing foreclosures on families struggling to stay in their homes - slowing our economic recovery. This investigation will ask the tough questions to bring about real changes to this broken system so that people can no longer be given the run-around when trying to stay in their homes."
In May, Leahy introduced legislation co-sponsored by Blumenthal to strengthen the tools available to the United States Trustee to protect homeowners from creditor fraud in bankruptcy court. The Fighting Fraud in Bankruptcy Act will bolster the ability of U.S. Trustees and bankruptcy courts to fight creditor fraud and protect homeowners in the bankruptcy process.
Eleven of the nations's leading mortgage service companies recently received a letter asking for clarification of their policies and procedures regarding mortgage foreclosures as they relate to the filing of proofs of claim and motions for relief from stay in bankruptcy cases. The letter was signed by Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., and Committee Member Richard Blumenthal, D-Conn.
"Evidence has been mounting for some time that loan servicing institutions are unprepared to deal adequately with the complexity of the [foreclosure] crisis in a fair and equitable manner that is consistent for all homeowners. Fraudulent and faulty documents filed in state and bankruptcy courts to facilitate foreclosures have trigered several investigations, including inquiries by federal regulators and state attorneys general, but the problem remains widespread. Clifford J. White, III, director of the Executive Office for the United States Trustee, recently stated publicly that an investigation by his office has revealed that the rate of obvious, facial errors in proofs of claim in the bankruptcy courts may be 10 times higher than previously disclosed. This is a shocking and disappointing statistic, but consistent with what bankruptcy judges, attorneys and homeowners have been experiencing for some time," the letter states.
In a statement, Leahy expressed concern "that homeowers who are compelled to turn to the bankruptcy process far too often face serious misconduct by mortgage servicers. We need a full understanding of the mortgage servicing policies and practices at the heart of these problems. We have a responsibility to ensure that Americans are protected from fraud and other misconduct when they seek relief in our federal bankruptcy courts."
Blumenthal observed that the "ongoing abuses and fraudulent practices by mortgage servicers are needlessly forcing foreclosures on families struggling to stay in their homes - slowing our economic recovery. This investigation will ask the tough questions to bring about real changes to this broken system so that people can no longer be given the run-around when trying to stay in their homes."
In May, Leahy introduced legislation co-sponsored by Blumenthal to strengthen the tools available to the United States Trustee to protect homeowners from creditor fraud in bankruptcy court. The Fighting Fraud in Bankruptcy Act will bolster the ability of U.S. Trustees and bankruptcy courts to fight creditor fraud and protect homeowners in the bankruptcy process.
Friday, August 19, 2011
Long Term Debts and the Chapter 13 Plan
In the Pierrotti v. IRS case, decided by the Fifth Circuit earlier this year, the Court affirmed that a Chapter 13 Debtor could not pay off an IRS lien over more than the length of his plan (which at most can be 60 months).
The code provision allowing payment beyond the plan term is for long term debts, such as home mortgages, whose original payment terms set a final payment date after the end of a Chapter 13 plan's term.
Lee Norton Bain, Attorney at Law, has been practicing in Georgetown since 1980.
The code provision allowing payment beyond the plan term is for long term debts, such as home mortgages, whose original payment terms set a final payment date after the end of a Chapter 13 plan's term.
Lee Norton Bain, Attorney at Law, has been practicing in Georgetown since 1980.
Friday, August 12, 2011
The Bankruptcy Filing Process
You should consult with a bankruptcy lawyer who can guide you through the process (most attorneys will not charge for an initial office visit, in my firm the first 30 minutes are without charge or obligation). So,
Step 1: Set up an office visit with a bankruptcy lawyer to discuss your various options.
Step 2: Put together necessary documents for your attorney to take a look at. He/she will get more detailed later with what you need to produce, but for now you need information about your income, your debts and what kind they are, and your assets and their probable values.
Step 3: Complete the 'means test' with your attorney. This can decide if you qualify to file under Chapter 7 or if you must file under Chapter 13. Sometimes you want to file under Chapter 13 regardless, decide this with your lawyer.
Step 4: After you visit with your attorney, if you are going to file bankruptcy, you will need to take a course on credit counseling from an approved provider. Your attorney should provide the details and give you some options for providers. 'Taking a course' sounds ominous but it's not, you can take the course on-line for less than $40 and it takes most people under an hour.
Step 5: Complete the packet from your attorney, get together the necessary documents your lawyer requests and review the drafts of all the proposed filings from your lawyer. Then, it's time to file your petition, schedules, statements, etc.
Step 6: Attend the 341 meeting (creditors meeting) in Austin (for Western District of Texas, Austin Division filers) with the Chapter 7 or Chapter 13 Trustee (creditors rarely appear). This meeting is usually about 30 days after your initial filing. This meeting usually lasts only a few minutes, is mandator, and is conducted by the Trustee to, among other possible matters, determine if you own any non-exempt assets that can be liquidated to pay creditors.
Step 7: Complete another course, this one is called 'personal financial management'. You must do this to get your discharge.
Step 8: For most debtors in a Chapter 7 case, this step is the hardest. Wait. If everything about your case has been successfully completed, the clerk can issue your discharge sometime after 60 days from the date of that 341 meeing, that is your goal. In a Chapter 13 case, you have to get your plan confirmed, this may involve your needing to go to court, but only if the Chapter 13 Trustee does not recommend confirmation. If your plan gets confirmed, you just continue making payments as called for by the confirmation order.
That hits the high points.
Lee Norton Bain Attorney at Law has been in practice since 1980 and can help you with your bankruptcy issues.
Step 1: Set up an office visit with a bankruptcy lawyer to discuss your various options.
Step 2: Put together necessary documents for your attorney to take a look at. He/she will get more detailed later with what you need to produce, but for now you need information about your income, your debts and what kind they are, and your assets and their probable values.
Step 3: Complete the 'means test' with your attorney. This can decide if you qualify to file under Chapter 7 or if you must file under Chapter 13. Sometimes you want to file under Chapter 13 regardless, decide this with your lawyer.
Step 4: After you visit with your attorney, if you are going to file bankruptcy, you will need to take a course on credit counseling from an approved provider. Your attorney should provide the details and give you some options for providers. 'Taking a course' sounds ominous but it's not, you can take the course on-line for less than $40 and it takes most people under an hour.
Step 5: Complete the packet from your attorney, get together the necessary documents your lawyer requests and review the drafts of all the proposed filings from your lawyer. Then, it's time to file your petition, schedules, statements, etc.
Step 6: Attend the 341 meeting (creditors meeting) in Austin (for Western District of Texas, Austin Division filers) with the Chapter 7 or Chapter 13 Trustee (creditors rarely appear). This meeting is usually about 30 days after your initial filing. This meeting usually lasts only a few minutes, is mandator, and is conducted by the Trustee to, among other possible matters, determine if you own any non-exempt assets that can be liquidated to pay creditors.
Step 7: Complete another course, this one is called 'personal financial management'. You must do this to get your discharge.
Step 8: For most debtors in a Chapter 7 case, this step is the hardest. Wait. If everything about your case has been successfully completed, the clerk can issue your discharge sometime after 60 days from the date of that 341 meeing, that is your goal. In a Chapter 13 case, you have to get your plan confirmed, this may involve your needing to go to court, but only if the Chapter 13 Trustee does not recommend confirmation. If your plan gets confirmed, you just continue making payments as called for by the confirmation order.
That hits the high points.
Lee Norton Bain Attorney at Law has been in practice since 1980 and can help you with your bankruptcy issues.
Wednesday, August 3, 2011
Basic Steps for a Chapter 7 Bankruptcy
If you are wanting to file a Chapter 7 bankruptcy and you qualify to do so, you are entering into what may seem an overwhelming and difficult time, but it need not be so. Here are some of the basic steps in going through a Chapter 7 bankruptcy:
1) Review your monthly income against your monthly expenses;
This sounds basic, but it is important for you to know all your sources of income, your monthly expenses, and to whom and how much you owe money. You should go through all your bills, list your creditors and how much in total that you owe each. I will pull your credit report, but not all creditors show up on the report, so you must furnish the identity of any others. Remember, the bankruptcy code requires you to disclose ALL creditors, besides, if you don't, you may not receive a discharge of that particular debt.
2) Pay attention to possible foreclosures, repossessions and/or judgments;
Sometimes these are the things that cause you to need to file a bankruptcy, often times when this kind of thing happens or is about to happen, that's when people come to see me. Every situation is different, but time can be of the essence, don't wait too late to do something.
3) Consult with an attorney;
If you are needing help to file a case, that is not the time to try to represent yourself. See a good bankruptcy lawyer. You need someone to walk you through the process, which can be quite complicated for some. It may cost more money, but the cost can be well worth it. Be sure to do this in plenty of time to give the lawyer time to prepare your case to file, please don't wait too long.
4) Take the required credit counseling course;
The bankruptcy code now requires anyone filing a Chapter 7 case to complete two different educational classes, one called credit counseling and one called personal financial management. One is take before your case is filed and one after. These classes can be take on-line or over the phone and there are many providers for this service. Remember, you won't get a discharge of your debts without completing them and filing your certificates with the clerk (the filing is done by your lawyer).
5) File your case, along with the accompanying schedules;
After you take care of the above matters and make proper arrangements with your attorney, your case will be filed. Times vary to do this, but the biggest variable is how quickly you get all the information and documents to your lawyer. Some documents are difficult to obtain, like pay stubs, W-2s, tax documents, etc., so understand this going in. Your lawyer may seem to be hounding you to get this in, but there is a reason for this, since most of what is asked for is required to be furnished to your Trustee, and often times if it is not, the Trustee can move to dismiss your case.
6) Attend your 341 meeting (your meeting of creditors);
Your 341 meeting, which is in Austin if you are filing in the Western District of Texas, Austin Division, is usually set about 30 days after your case is first filing. Your lawyer will get the exact date from the clerk once your case is filed. Creditors may show, although they usually do not, and ask questions about your debts or collateral. Your lawyer will be with you for this meeting; it may seem stressful and uncomfortable but remember, all those other people that will be there are there for their particular meeting and feel the same way.
7) Wait your time and get your discharge order;
Sometime after the 60 day waiting time after your 341 meeting, the clerk can issue your discharge order, assuming there are no objections, adversary matters or other filing to prevent this. Some debts may not be dischargeable, student loans, child support obligations, most IRS debts, for example. But, in the vast majority of cases, it's done.
Lee Norton Bain has been in practicing in Georgetown, Texas since 1980 and is now handling almost only bankruptcy cases. Please visit him at his website "leebainlaw.com".
1) Review your monthly income against your monthly expenses;
This sounds basic, but it is important for you to know all your sources of income, your monthly expenses, and to whom and how much you owe money. You should go through all your bills, list your creditors and how much in total that you owe each. I will pull your credit report, but not all creditors show up on the report, so you must furnish the identity of any others. Remember, the bankruptcy code requires you to disclose ALL creditors, besides, if you don't, you may not receive a discharge of that particular debt.
2) Pay attention to possible foreclosures, repossessions and/or judgments;
Sometimes these are the things that cause you to need to file a bankruptcy, often times when this kind of thing happens or is about to happen, that's when people come to see me. Every situation is different, but time can be of the essence, don't wait too late to do something.
3) Consult with an attorney;
If you are needing help to file a case, that is not the time to try to represent yourself. See a good bankruptcy lawyer. You need someone to walk you through the process, which can be quite complicated for some. It may cost more money, but the cost can be well worth it. Be sure to do this in plenty of time to give the lawyer time to prepare your case to file, please don't wait too long.
4) Take the required credit counseling course;
The bankruptcy code now requires anyone filing a Chapter 7 case to complete two different educational classes, one called credit counseling and one called personal financial management. One is take before your case is filed and one after. These classes can be take on-line or over the phone and there are many providers for this service. Remember, you won't get a discharge of your debts without completing them and filing your certificates with the clerk (the filing is done by your lawyer).
5) File your case, along with the accompanying schedules;
After you take care of the above matters and make proper arrangements with your attorney, your case will be filed. Times vary to do this, but the biggest variable is how quickly you get all the information and documents to your lawyer. Some documents are difficult to obtain, like pay stubs, W-2s, tax documents, etc., so understand this going in. Your lawyer may seem to be hounding you to get this in, but there is a reason for this, since most of what is asked for is required to be furnished to your Trustee, and often times if it is not, the Trustee can move to dismiss your case.
6) Attend your 341 meeting (your meeting of creditors);
Your 341 meeting, which is in Austin if you are filing in the Western District of Texas, Austin Division, is usually set about 30 days after your case is first filing. Your lawyer will get the exact date from the clerk once your case is filed. Creditors may show, although they usually do not, and ask questions about your debts or collateral. Your lawyer will be with you for this meeting; it may seem stressful and uncomfortable but remember, all those other people that will be there are there for their particular meeting and feel the same way.
7) Wait your time and get your discharge order;
Sometime after the 60 day waiting time after your 341 meeting, the clerk can issue your discharge order, assuming there are no objections, adversary matters or other filing to prevent this. Some debts may not be dischargeable, student loans, child support obligations, most IRS debts, for example. But, in the vast majority of cases, it's done.
Lee Norton Bain has been in practicing in Georgetown, Texas since 1980 and is now handling almost only bankruptcy cases. Please visit him at his website "leebainlaw.com".
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