Category Archives: Bankruptcy Glossary

Chapter 7 Bankruptcy Timeline

Published: February 10th, 2012 | Categories: Bankruptcy Glossary | 0 Comments

The most common type of bankruptcy case is the Chapter 7 no asset case. In this case the debtor does not lose any property and unsecured creditors (e.g. credit card companies and medical bills) receive nothing. A Chapter 7 no-asset bankruptcy is usually a “quick and easy” process. The following timeline describes the process:

Meet Your Attorney

Your attorney will listen to your concerns, identify legal issues concerning your debts, and recommend legal solutions. While bankruptcy is not always the best option to solve a financial problem, it is a powerful tool that should be considered. Your attorney will also ask you to provide financial documentation such as tax returns, titles and deeds, and paystubs. You

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Credit Card Debt Takes Toll on Relationships of Chicago Couples

Published: February 8th, 2012 | Categories: Bankruptcy Glossary | 0 Comments

Maybe the best gift you can get your significant other this Valentine’s Day is to come clean about your credit card debt and make a commitment to solving the problem together, perhaps with help from Chicago bankruptcy.

Studies have pegged debt right up there with infidelity as one of the top causes of breakups and divorces in the US. But often it’s not the debt itself that’s the problem.

As many as 80 percent of spouses hide purchases, bank accounts, or credit cards, according to a survey by CESI Debt Solutions.

Chicago bankruptcy lawyers have spoken with many clients who spent years hiding credit card debt and other money woes from a spouse or partner, ultimately damaging the relationship and allowing their financial troubles to spiral out of control.

It’s true that debt causes stress, and stress can take a toll on your relationship.

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The Heavy Cost Of Reaffirming A Mortgage In Bankruptcy

Published: January 19th, 2012 | Categories: Bankruptcy Glossary | 0 Comments

When filing a Chapter 7 petition for bankruptcy, you can include reaffirmations of secured loans. These would typically involve your home and your motor vehicle. Reaffirmation is a process that advises the court that you are maintaining full responsibility for the loan, and that it isn’t to be included in the bankruptcy process. There are some real dangers in reaffirming these loans, particularly after the bankruptcy process has been completed.

Filing for bankruptcy automatically triggers an event known as a stay. A stay is a legal requirement that prevents all creditors from taking any further action – this includes lenders that own your mortgage. Once

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When a Creditor Violates the Bankruptcy Discharge

Published: January 17th, 2012 | Categories: Bankruptcy Glossary | 0 Comments

The bankruptcy discharge is a court ordered permanent injunction prohibiting certain creditors from taking collection action against the debtor. A debt discharged by your bankruptcy cannot be collected from you. Unfortunately, some creditors refuse to take “No” for an answer. If you are contacted regarding a discharged debt, here’s what to do:

Inform the creditor of your bankruptcy discharge When a debt is discharged in bankruptcy it does not simply vanish. The debt still exists; it is just not “collectible.” This debt may be sold or transferred to another collector, and the new collector may not know about your bankruptcy discharge. This is not to say that ignorance is a defense to violating the court order! However,

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IRS to Chapter 13 Debtors: File Your Returns by February 5!

Published: January 6th, 2012 | Categories: Bankruptcy Glossary | 0 Comments

We all know that individual tax returns are due on April 15 (or a day or two later if April 15 is on a weekend).  But Congress inserted a little tax time craziness into sections 1308 and 1307 of the new and drastically unimproved Bankruptcy Code of 2005.  Section 1308(a) states:

(a) Not later than the day before the date on which the meeting of the creditors is first scheduled to be held under section 341 (a), if the debtor was required to file a tax return under applicable nonbankruptcy law, the debtor shall file with appropriate tax authorities all tax returns for all taxable periods ending during the 4-year period ending on the date of the filing of the petition.

At first reading, this section appears to only be dealing with those returns the debtor was required to file prior to the 341 hearing or First Meeting of Creditors.  For example, if its February 5th, 2012, and Im a debtor in bankruptcy, it cant be said that I was required to file my 2011 return.  After all, the IRS gives me until April 15.

But like many provision of the Bankruptcy Code, this ones a little murky.  And section 1308(b) provides:

(1) Subject to paragraph (2), if the tax returns required by subsection (a) have not been filed by the date on which the meeting of creditors is first scheduled to be held under section 341 (a), the trustee may hold open that meeting for a reasonable period of time to allow the debtor an additional period of time to file any unfiled returns, but such additional period of time shall not extend beyond—

(A) for any return that is past due as of the date of the filing of the petition, the date that is 120 days after the date of that meeting; or

(B) for any return that is not past due as of the date of the filing of the petition, the later of—

(i) the date that is 120 days after the date of that meeting; or

(ii) the date on which the return is due under the last automatic extension of time for filing that return to which the debtor is entitled, and for which request is timely made, in accordance with applicable nonbankruptcy law. [emphasi

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