The 341 meeting is required under the bankruptcy code. It is a rather informal meeting where the trustee (a hearing officer) appointed to the bankruptcy will review the Debtor's bankruptcy petition and ask questions about potential assets within the Chapter 7. The meeting is rather informal and it is usually not held in a courtroom. Debtors often ask what should I wear? Well, it is an informal meeting and there is no need for a suit or formal dress. A nice shirt and pants are appropriate for men, and for a woman slacks or a dress is fine also. Just use common sense about what to wear. The meeting is held approximately 30 days after the filing of a Chapter 7, Chapter 13 or any other type of bankruptcy.

Common questions for a Chapter 7 will be:

1. State your name and address for the record. Did you review the petition and schedules prior to them being filed with the court? Did you understand the documents? Do you wish to go forward with the case?

2. The trustee will verify the social security number and ID for the record

3. The trustee will place the Debtor under oath.

4. Do you own any real estate? If so when was it purchased and what was the purchase price? When was the last time that you refinanced the property and what was the property valued at that time? What do you think the property is worth today and how much do you owe on the property? How do you come up with the value of the property?

5. Do you own any other real estate anywhere else in the world?

6. Do you have any stocks, bonds or any other investments?

7. Do you own or have in your possession any gold, silver, jewelry, firearms, hobby equipment, and/or any personal property worth over $500 or more that has a resale value?

8. Are you suing anyone for any type of money damages (personal injury claim, etc.)?

9. Is anyone holding money or property for you?

10. Have you transferred, sold, or abandoned any property within the last 5 years prior to filing this bankruptcy?

11. Does anyone owe you money or property?

12. Have you owned or operated a business in the last 5 years?

13. Do you expect to receive an inheritance in the near future?

14. Have you won the lottery?

15. Do you have a safety deposit box. If so what is in it.

The list above is by no means exhaustive. Some trustees ask more questions and some will ask less based upon the schedules and petition. The questions may vary in form but they are a good indicator of what may be asked. The trustee in a Chapter 7 is looking for un-exempt assets to liquidate for the benefit of the Debtors creditors. What the Debtor will want to hear at the end of the meeting is that the trustee finds NO ASSETS to distribute to creditors. This means that the trustee will file a no asset report with the court and the debtor will get their discharge 60-90 days from the meeting of creditors.

At my law office, I am a experienced Chicago Bankruptcy Attorney who has helped numerous clients navigate the bankruptcy process with dignity and respect throughout. I want to lose your debt and keep your dignity! If you are interesting in setting up a free consultation with my office please call me today at 312-489-8182.

Sincerely,


Marc G. Wagman
Attorney at Law

In recent news, the attorney generals of all the states around the country have launched joint investigations into the foreclosure proceedings by some banks. According to this article, the probe is based upon Chase and Bank of Americas halt of all their foreclosures nationwide. The problem with the foreclosures is that it has been revealed that many banks used "robosigners" or individuals who did not review actual payment histories regarding the necessary affidavits of default in foreclosures in many states. These affidavits are required for a foreclosure proceeding to go forward. In Illinois a default is required for a foreclosure lawsuit to be initiated. It appears from news reports and public records that the affidavits filed in court were not properly reviewed by the banks employees who signed the documents. Other problems that have been reported has been the failure to attach the proper mortgages regarding the property, foreclosing on the wrong property, etc.

From my experience many of the foreclosures in Illinois are properly initiated by foreclosing banks; however, it is difficult to assess whether a foreclosure is defective without hiring an attorney in the the foreclosure suit. Generally speaking, a borrower would not be aware if the banks affidavits, records etc. are what they appear to be without having an attorney review the documents or at the minimum filing an appearance in the case. In addition, most borrowers do not file an appearance in a foreclosure because the court charges an appearance fee and many feel it is a fruitless endeavor.

One of the problems that I recognize is that the foreclosure law firms are under strict guidelines to meet deadlines in order to foreclose on a property. The foreclosure firms are even graded on how fast they proceed in a foreclosure against their competitor law firms. There is an incentive to cut corners and the firm can be penalized by moving to slow or being to careful. The mortgage industry has in the past cut corners in foreclosure proceedings in order to make the process quicker and more streamlined. Failure to review affidavits and have personal knowledge of the default is just one of the many problems that have plagued the industry.

The most common issue I am seeing currently is the borrower is speaking with the mortgage company in order to obtain a loan modification and has filled out paperwork with the mortgage company while at the same time the foreclosure is going forward. While the borrower is trying to get an answer on the loan modification the foreclosure is going further and further down the process. In some instances the borrower is even in a trial period modification making a lower payment amount when the property goes for a sheriff sale. Any money that they have paid for the trial period payments goes out the door and the borrower is eventually evicted from the property. In some rare instances I will see a fully executed loan modification and the mortgage company does pull the foreclosure from the court.

It is important to note that a Chapter 13 will stop a foreclosure dead in its tracks by curing the mortgage default for up to five years and repaying any other creditors in addition to the persons mortgage. However, to save a property in Illinois a person must file a Chapter 13 before there is a sheriff sale or court appointed auction of the property. The foreclosure sale normally is 6-9 months after the initial foreclosure complaint. In addition, a Chapter 7 eliminates a persons personal liability on the mortgage and note and protects a person against any potential deficiency after the foreclosure sale. No matter what the mortgage company is telling you over the phone you should speak with an attorney once a foreclosure is started against your property.

My office has saved numerous homes from foreclosure and if you have a foreclosure suit filed against you it is imperative that you speak to a Chicago Bankruptcy Attorney as early as possible so you can go through your options regarding the foreclosure and resolving any other debts including credit cards. I want you to lose your debt and still maintain your dignity! If you have questions please call my office at 312-489-8182.

Marc

A high percentage of my potential clients or people I talk to everyday perceive a Chapter 7 bankruptcy as the only way to go in resolving their debts (Learn More About Chapter 7). However, for someone who has assets or makes over the median income and is not eligible for a Chapter 7 a Chapter 13 is a viable option (Learn More About Chapter 13).
Chapter 13 is a reorganization or repayment plan that lasts up to five years. The best deal about it is that you don't pay any interest to your creditors. Let me say that again you don't pay any interest to your unsecured creditors. In addition, interest stops accumulating at the time of filing. Not paying interest to your creditors in a Chapter 13 includes such debts as credit cards, medical bills, unsecured loans, payday loans, tax debts, and other types of debt. It will also reduce the interest rate on your car loan to approximately 6% presently. On taxes, the IRS charges extremely high interest and penalties on past due taxes outside of bankruptcy, and in a Chapter 13 the taxes and penalties stop!
I will often meet with a client who thinks that a Chapter 13 is not a good option for them if they don't qualify for a Chapter 7. In almost all instances filing a Chapter 13 versus any other non-bankruptcy option is a much better plan of action. This includes paying the minimum payments on your credit cards (which will take 15 years minimum to pay off the principal), debt consolidation (read my blog on that), or repayment plans with a credit counselor (in most cases you will pay interest or interest will accumulate and you will pay the creditors back for a minimum of 5 years). What one must realize is that if you are struggling to pay your debts and you are speaking with a Chicago Bankruptcy Attorney like myself then you normally are bleeding out money right now. What a Chicago Bankruptcy Lawyer should say is that we need to stop the bleeding. Most of the bleeding so to speak, is that you are paying interest to your creditors and that's where most of the money is going and not to principal.
In addition, if you file a Chapter 13 there is a chance that even if you are paying a 100% to your unsecured creditors there is a chance that they will not file a proof of claim showing that you owe them money within the allotted period of time. If they don't file a claim with the court and you get a discharge in the Chapter 13 they are never allowed to collect the money again! Also, most lenders will tell you that a Chapter 13 is better on your credit score than a Chapter 7, because you are repaying some or all of your debts and it creates a payment history that is traceable. Further, Chapter 13 will take care of parking tickets, IRS Debt, overpayment of government type benefits or other types of non-dischargeable debts.
When filing a Chapter 13 or a Chapter 7 bankruptcy a Chicago Bankruptcy Attorney like myself will go through the process with you and advise you of all your options including your non-bankruptcy options. Even if you have to file a Chapter 13 what you should remember is that you are not paying interest to your unsecured creditors (i.e. it is an interest free repayment plan). Where else can you get an interest free repayment plan to pay your unsecured creditors? In most cases if you are struggling to pay your bills then you should at least consider bankruptcy. If you have questions or want to schedule a free consultation then call my office at 312-489-8182! I want you to lose your debt and still keep your dignity!.

Marc

The Federal Trade Commission recently issued new regulations covering the debt settlement industry. These new rules prohibit the debt settlement companies from doing the following:

1. Prohibiting them from promoting themselves as non-profit entities.

2. Prohibiting exaggerated or misleading claims such as being able to cut debts in half.

3. Making the Debt Consolidators explicitly divulging all costs associated with their services.

4. Giving consumers a full explanation of the impact of debt settlement on the consumers credit scores.

5. Forbidding the charging of upfront fees for any debt relief services.

As a Chicago Bankruptcy Attorney, I often meet clients who try to use a debt consolidation company prior to retaining our services. Most of our bankruptcy clients who attempt this solution regret retaining them and wish they had come to us sooner. The problem with a debt consolidator is that most consumers waste precious time and money attempting to settle their debt and their credit scores are destroyed even more than they would be by doing a bankruptcy.

The Debt Consolidation industry usually works by the consumer paying a monthly payment into the "program" each month to build up a "settlement amount" for the creditors. In the meantime the credit cards are falling more and more behind and are in default with the higher interest rates and fee's. While the amount paid monthly builds up the creditors can call the consumer, collect, or even sue the person. In addition, most companies use the monthly fee as a non-refundable retainer for their services and rarely will a consumer get any of the money they paid back if they are unsatisfied (i.e. they get the money you pay them if you decide later to not use their services).

I have seen countless clients in the past number of months who have paid as much as $10,000 to a debt consolidator to settle their debts without seeing any settlement in return for their payments. I have yet to see a client get a refund of any money they paid to a company either. This article, summarizes the following new regulations. The FTC issued the new regulations due to the numerous complaints it received in the last couple of years regarding these companies.

Bankruptcy is a federal law that protects you from creditors whether it is a Chapter 7 or a Chapter 13. Chapter 7 is a bankruptcy where the consumer wipes away their unsecured debts. A Chapter 13 is a reorganization bankruptcy where the person pays a percentage to their unsecured creditors without interest accumulating as soon as the person files. Bankruptcy is often a much better choice than attempting settlement of credit card debts or other types of debts.

My consultation is free so it wouldn't hurt to talk to me prior to deciding what you decide to do regarding outstanding obligations. I will be more than happy to speak with you regarding all your options and positive and negative ramifications of any option you have. Lose your debt and keep your dignity! Please call me for a free consultation at 312-489-8182.

Marc Wagman

Attorney at Law

The 2005 amendments to the bankruptcy code placed a significant document hurdle on the debtor and the attorney prior to the filing of a bankruptcy. One of the significant changes was the means test, and the requirement of budget and credit counseling prior to the filing of a Chapter 7 or a Chapter 13 bankruptcy. In most cases our office will need the following documents prior to the filing of a bankruptcy:

1. A copy of your photo ID and Social Security card.

2. All pay advises (stubs) received by you and your spouse within the last 6 months.

3. All proof of household income including any of the following: Pay stubs, Social Security and/or disability benefits, unemployment benefits, child support, rental income, part-time jobs and any other source of income that you may have.

4. Proof that you have filed your taxes for the last 4 years (unless you were not required by law to file for any or all of these last 4 years). There is an additional document in this package that explains how to gain tax transcripts within 7- 10 business days.

5. If you own real estate or vehicles the current statements for these items.

6. Car insurance policy.

7. Any retail installment contracts.

8. The last two months of statements for all your bills.

9. The last two months of bank statements.

10. Name and last known address of Child Support/Alimony Receiver

This list is by no means a comprehensive list for all clients. In some cases we may need more or less documents and the above documents may or may not apply to everyone's case. On the above list the least important documents are your bills, because we pull a credit report for all of our clients whether they file a Chapter 7 or a Chapter 13.

I have represented consumers just like you for a number of years. I am an experienced Chicago Bankruptcy Lawyer who helps clients lose their debt and keep their dignity! Please feel free to call me for a free consultation at 312-489-8182.

My wonderful wife likes to watch the Real Housewives Series on Bravo, especially the Real Housewives of New Jersey series. I started to watch the series with her last year and I have to say that it rather interesting if you like high drama, its kinda like watching a train wreck or a car crash. Last year in October 2009, one of the reality shows main characters Teresa & Joe Giudice filed a Chapter 7 bankruptcy while the show was filming. A Chapter 7 bankruptcy is a "straight bankruptcy" or a liquidation bankruptcy where the trustee or court appointed officer liquidates any non-exempt assets for the benefit of creditors Chapter 7.

A Chapter 7 like any bankruptcy is filed under the penalty of perjury and perjury is a very serious crime just ask Bill Clinton and Scooter Libby both were convicted of it. According to this article, the Giudice's allegedly hid assets from the trustee in order to keep them from their creditors. In addition, it appears that from public records and news reports one of their creditors and their case trustee are objecting to their discharge. In addition, it appears from those public records and news reports that several adversary complaints have been filed in the bankruptcy against the Giudice's alleging fraud.

Just recently, it appears that the United States Department of Justice Office of the United States Trustee filed a 19 page objection to the Debtor's discharge alleging that the Debtor failed to list several assets on the initial petition including any bank accounts held by either debtor, several vehicles, the Debtor's wife's interest in her book "Skinny Italian" a New York Times best seller, several business interests that Joe Giudice derives income from and has an interest in which included two parcels of land, as well as other assets. Despite the Debtors making several amendments to their petition the Debtors are alleged to have still failed to list assets.

This article, provides a link to the actual adversary complaint by the United States Trustee. It appears from reading the complaint that the trustee conducted the 341 meeting and was "tipped off" about the fraud so he conducted a 2004 examination (a deposition and request for bank records and other documents) where the Debtors were asked about several of the "discrepancies" between their petition and reality. What is rather apparent for anyone who watches the reality series that the Debtors had assets prior to the filing and it was just a matter of time before the Trustee was going to inquire further into any assets.

Mrs. Giudice is also alleged to have not listed her interest in her best selling cookbook even after the amendments, or her website that sells various items and produces significant income which she is the sole member. According to the complaint, the Debtors "tax returns" submitted to the case trustee were never even filed with the IRS for 2006, 2007, and 2008 which is required pursuant to 11 U.S.C. 521 and can result in dismissal of the bankruptcy case. Further, the complaint alleges that upon examination of Mrs. Giudice's bank records significant deposits of over $100K were allegedly placed in her personal account prior to the filing and over $192K was allegedly deposited into her personal account after the filing.

Even more troubling it is alleged that the contract for the publishing of her book "Skinny Italian" was dated approximately one week prior to the petition date and was signed right after the filing on November 18, 2009. It is apparent from news reports that the trustee in the case believed that the book and the royalties derived from the book were property of the estate and he filed an objection to the Debtor's discharge on that basis among others.

As a Chicago Bankruptcy Attorney it is rather clear that the Giudices have a lot of unresolved issues and problems with their bankruptcy filing. It is this attorneys opinion that these Debtor's will get criminally charged for their omissions which could result in several felonies. They also will likely not receive their discharge. What is rather clear is that if the Giudices go to trial on the adversaries then it will be a major public spectacle with the media reporting it all.

I cannot state how important it is for a Debtor to list all assets and liabilities in a bankruptcy. Our office hands out a disclosure pursuant to 11 U.S.C. 527 (a) (2) which states under very clear terms that a bankruptcy is filed under the penalty of perjury, and that all assets and liabilities must be listed (our office even explains the document and has the client sign it). In the rare instance that a client fails to list an asset then the trustee would likely go after said asset, and could possibly object to the persons discharge, unless it is an innocent omission by the Debtor. Bankruptcy fraud is a serious criminal act and it is a felony, a person can spend up to five years in jail and pay a $250,000 fine. If a person commits bankruptcy fraud they are almost certain to lose their discharge on all of their debts just as the Giudice's are likely to lose theirs.

It is imperative that the Debtor tell the truth and the whole truth when filing bankruptcy. Our office will rarely see a Debtor who wants to lie to the court, and even if the occasional client who walks into our door wants to lie they would never be so brazen to show off assets on TV, spend a ton of money on TV prior to the filing, or show off assets to their attorneys and then fail to list them on their schedules. Even if they did this my opinion is that we have a duty to list any assets we learn about whether or not the client wants to list them or not. Further, if the client insists on not telling the truth we will of course not touch the case and will not file the petition, and we will of course send the potential client out the door. What is clear is that the FBI investigates bankruptcy fraud and the Department of Justice will and does prosecute bankruptcy fraud in our district and others.

It is this authors opinion from experience that about 99.9% of our bankruptcy client are the "honest but unfortunate debtor who deserve a fresh start" and warrant the discharge issued by the court. It is really sad that these numbskulls may leave the impression that a lot of debtors are doing something wrong by filing bankruptcy which is an unfair and unwarranted assumption. The vast majority of Debtors are honest forthright with their assets and liabilities.
It is this authors opinion that the Office of the

United States Trustee is going to pursue criminal charges in the Giudice's bankruptcy filing due to the fraud and "celebrity" status just as the DOJ did in the Martha Stewart insider trading case. There is a significant deterrence factor when the person is a public figure such as the Giudices and to give them a very stiff sentence if they are convicted and to make an example out of them to deter others from doing the same. This story is certainly a lesson in what you should not do when you file a bankruptcy! Please call my office for a free consultation at 312-489-8182!

Marc Wagman

This article Banks Feast on Bankrupt Consumers, speaks about how the credit card industry and banking lobby pushed through the 2005 bankruptcy reform act. The bankruptcy reforms enacted by Congress, were heavily pushed by the credit card industry in response to the "perception" that consumers should not be able to walk away from their credit card debts in a Chapter 7 liquidation Chapter 7. The "trap" that the banks lobbied for was to put more middle class consumers into a Chapter 13 repayment plan over five years ((Chapter 13 with an Chicago Bankruptcy Attorney)). The Chapter 13 that the banks lobbied for was an automatic five year repayment plan based upon the means test which is your "average income in your state for the size of your household (or an average of the person income over the last six months from all sources to come up with the persons "income" if that number is over the median income you are "presumed" to have to do a Chapter 13, but you go through "the full means test" then only deducting hypothetical census bureau standard living expenses in your area and/or "other legitimate expenses" that Congress believed were "appropriate" under the test).

There are some major points that the article makes that I believe are very important and noteworthy.

1) The 2005 bankruptcy reform did slow the rash of filing for bankruptcy for a couple of years. ( you can look at the filings at the ABI and they did in fact decrease significantly)
2) Americans are saddled with more debt than ever and their incomes have dropped significantly in this "downturn" although more people are now saving
3) Chapter 7 Filings have now increased to pre-2005 levels

The last point number three is the most important thing to focus on here. Number three is important because Chapter 7 bankruptcies generally only will increase after the 2005 change of law if two things are true 1) middle class or upper middle class consumers are not making more than the median income in the state and are then eligible for a Chapter 7, and 2) the filer has very little or no assets to protect and then they are then eligible for a Chapter 7. This means that those Chapter 7 filers if they are "middle class" generally are either out of work or have had a reduction of income and have little or no savings to protect. Generally most economists will agree that for our economy to improve consumers must spend money and the middle class consumer must be economically sound. Every day our office sees the "downturns" casualties, from all walks of life. It seems that everyone is struggling at this point and everyone is worried about losing their job.
I am a Chicago Bankruptcy Attorney, who is here to help you when you are struggling with insurmountable debt and a potential or actual job loss. I am an experienced Chicago bankruptcy lawyer who represent the struggling consumers who are living paycheck to paycheck struggling to pay their bills. Whether it is a lose of a job or reduction in income, divorce, medical debt, or just crushing debt I am here to help you navigate through the process of bankruptcy and we are here to answer your questions.

If you have a garnishment we can stop the deduction with the filing of either type of bankruptcy. If you are in foreclosure a Chapter 13 will stop the foreclosure. My consultation is free, and we will be sure to give you all of your options which include not filing a bankruptcy. I want you to lose your debt and keep your dignity! Please call my office today for a free consultation at 312-489-8182!

Marc Wagman

Attorney at Law

A foreclosure in Illinois is a judicial foreclosure which means that it is administered by the courts. Specifically, the foreclosure is filed as a chancery case in that division if there is one in the county your property is in. For a foreclosure to be initiated against the borrower there must be a default.

The first step in foreclosure is that the lender will send out a notice of acceleration and a fair debt letter to the borrower, which is usually sent when the borrower is 3-6 months behind on their mortgage. Second, the foreclosure firm will due a title search on the property to make sure all parties are listed properly in the foreclosure such as other lien holders, any other liens on the property, and any other persons in the chain of title who have an interest in the property.

The complaint is filed with the court in the county that the defendant lives in or in Federal Court in rare instances. The foreclosure firm will record a lis pendens with the county recorders office on the property to notify parties that there is a lawsuit regarding the property. The complaint is the start of the lawsuit, and must list the following

A) the date of the mortgage
B) the names of the mortgagor and mortgagee
C) the date and place of recording of the mortgage
D) the interest that is subject to the mortgage
E) the amount of the mortgage indebtedness
F) a statement of the default (there must be a default)
G) a legal description of the property
H) and any parties in interest to the property among other things

A copy of the original mortgage will also be attached to the complaint as well as any assignments or proof that the plaintiff has the capacity to file the foreclosure against the defendant. Once the complaint is filed the mortgage company or foreclosure firm must serve all interested parties. Once service is obtained over the Defendant they will have 30 days to answer the complaint and present any defenses to the foreclosure. If the defendant does not answer the complaint then the plaintiff will often move for a default judgment. If the defendant answers the complaint and files an appearance then the foreclosure may go to trial, although most defendants do not file an answer.

In practical terms the foreclosure sale will not normally take place until approximately six months from the judgment date on residential property. For residential property, the redemption period will expire the earlier of either seven months from the date of service of process or the date the Court obtains jurisdiction over the defendant or three months from the date judgment is entered. There is a six-month redemption period for non-residential property. Redemption is your right to bring the mortgage fully current by paying any arrears with any interest and costs that the plaintiff incurred. The right of redemption may be shortened if the property is abandoned by the defendant to 30 days, but the plaintiff must prove this by affidavit or certification. Once the judgment is entered the borrower has a minimum of a 90 day statutory right of redemption of the property.

During this time the mortgage foreclosure firm will request a judicial supervised sale of the property. The sale may not be held until after the expiration of the redemption period usually six months after the judgment is entered for residential real estate. The foreclosure sale or sheriffs sale is where the bank or investor buys back the property from the borrower. In practical terms this is the last date for the defendant to file a Chapter 13 bankruptcy (Chapter 13) to cure any mortgage arrears pursuant to Colon v. Option One Mortgage (7th Circuit)which is binding in Illinois. The Debtor prior to the foreclosure sale may file a Chapter 13 and bring the mortgage arrears current by repaying the amount over five years. Otherwise they must bring the mortgage fully current by reinstatement by paying all arrears, interest, attorney fee's, and sending written notice to the mortgage company prior to the sheriff sale. It is important to note that the defendant will normally not get any notice of the sheriff sale or foreclosure sale unless they filed an appearance in the foreclosure, because the foreclosure firm will publish the sale in newspaper circulating in the area for 3 weeks.

The sale will not be final until the court approves the sale which is usually 30 days after the sheriff sale. Nevertheless, the sale will be approved unless the court finds that one of requirements was not met, notice was not given or is defective, the terms of the sale were unconscionable, the sale was conducted fraudulently, or that justice was otherwise not done. It is extremely important to note that most sales are approved by the courts and the sheriff sale is extremely difficult to overturn once it has happened.

At that time, the judge will normally approve the sale and may allow for a personal judgment against the defendant for any deficiency. If a personal deficiency is filed against the defendant (borrower) then the person should likely file a Chapter 7 Bankruptcy to eliminate the claim against them. At the confirmation of sale a foreclosure deed will be issued to the mortgage company, and if the mortgage company was the only bidder at the sale then the defendant has a special 30 day right to redeem the property by paying off the entire mortgage plus any fees and costs. At the time of the expiration of the right of redemption (after confirmation of the sale) the mortgage company gets possession of the property; nevertheless, the time period will vary on the lender, and who is in the property.

It is important to realize that hiring an Chicago Bankruptcy Attorney prior to the sheriff sale is necessary to save your home from foreclosure. Once the sheriff sale happens it is too late to cure any arrears with a Chapter 13 bankruptcy. I will often hear from potential clients who are too late to save the property and call after the sheriff sale date. As long as the person is proactive and calls the foreclosure attorneys for updates then they will know where the mortgage company is in the foreclosure process.

Certainly if you have any questions call our office. We can save your home from foreclosure and I have saved countless homes over the years and I can also help you can wipe away any deficiency on the mortgage debt with a Chapter 7. If you have any questions please call my office at 312-489-8182.

Marc Wagman

Debt consolidators are everywhere and their advertisements can be heard on the internet, the radio, and now on TV. A reputable debt consolidator will attempt to negotiate a settlement for debts which are in default for a lower amount than is owed to the original creditor. The debt consolidation company will either negotiate a lump sum settlement amount with each creditor or have you pay a monthly amount in order to build up enough money for the company to settle the amounts with your creditors. So what is the catch?

The problem with debt consolidation is that many of the people cannot afford to pay either a lump sum payment to each one of their creditors and have to do it over time by making monthly payments to the debt consolidation company. An individual or couple may not have enough money to pay the monthly payment and may be using money they need for other household expenses. Also, the person must fall into default in order for the creditor to take a lower amount than is currently due, and interest will accumulate on the debt that is owed and the creditor will report each month to the credit reporting agency decreasing your credit score each month. The debt consolidation company will often take a percentage of any payments that you make each month and usually any money you pay to them is largely non-refundable or they take a large upfront fee.

The most important risk that a person takes when they choose debt consolidation is that they may risk garnishment, a frozen bank account, or a lien on real estate if a creditor sues the person. In sum, there is no protection against a lawsuit from one of the creditors if they decide to sue. The phone calls for collections also generally don't stop. Here is an article See the article detailing debt consolidation and what a person should look for. In the article it says that as many as 21 states have sued unscrupulous debt consolidators and complaints are rampant according to the FTC.

Bankruptcy will differ in the following ways from debt consolidation. Bankruptcy has the force of federal law and the automatic stay is your protection from any creditor coming after you for money or property Read More about the Automatic Stay. Most assets can be protected from your creditors. When a person files a bankruptcy there are set laws which are predictable for both the Debtor and the Creditors. Whether a person files a Chapter 13 Learn More about Chapter 13 there assets are not at risk and the person will repay debt back from 3-5 years without interest at a percentage.

A Chapter 7 is a liquidation bankruptcy where the person does not pay any debts back Learn More about Chapter 7 and gets to keep exempt property. When filing with an Chicago Bankruptcy Attorney like my office and I know the bankruptcy laws and I will guide you through the entire process, answer any questions you may have, and treat you with respect and dignity. Filing a bankruptcy is an important financial decision; however, it is a decision that a person should seriously consider if they are facing overwhelming debt, loss of a job, or a divorce. I meet with people almost every week who first try debt consolidation who waste precious money and time and ultimately end up filing a bankruptcy. Please call me today at 312-489-8182!

Marc Wagman

Bankruptcy fraud is a serious issue for both the attorney and of course the Debtor who files the bankruptcy petition. My wonderful wife likes to watch the show "The Housewives of New Jersey" and I have become enthralled in watching the reality show with her. One of the cast members and her husband (Teresa & Joseph Giudice) filed a Chapter 7 Chapter 7 bankruptcy last year. A Chapter 7 bankruptcy is a liquidation bankruptcy. Once a person files a Chapter 7 bankruptcy an estate is created of all the persons property they hold or have held in the last four years (or longer). The trustee or appointed court officer who is appointed to the person's case must liquidate any non-exempt assets for the benefit of the Debtor's creditors.

It seems from news reports and public records that the Guidice's lavish homes contents are scheduled for auction by the court appointed trustee. See the Article To make matters worse the trustee is filing an objection to the Giudice's discharge based upon a false oath (perjury) and their failure to explain their loss of assets and financial demise with proof through their books and records. The trustee is seeking to make all of their debts listed in the bankruptcy non-dischargeable under 11 USC 727, which is a very serious matter. If the trustee settles with the Giudices then any creditor may be able to step into the shoes of the trustee to object to the discharge according to current precedent. One creditor already has filed an objection to their discharge according to reports based upon allegations of fraud relating to Mr. Giudice.

The trustee has also alleged that the Giudice's failed to list interests in businesses, revenue from and interests in a book that Teresa Giudice wrote which is a New York Times bestseller, and other items as well as undervaluing property. Ms. Giudice in previous episodes can be seen spending lavishly on expensive clothes, going on shopping sprees, and throwing lavish parties for herself and her children. In the most recent episode, Teresa and her husband can be seen taking a rather lavish anniversary dinner at a nice hotel where they were staying, taking a limo there, and he gives her a purported enormous "yellow diamond ring" for her anniversary gift despite his financial problems and later filing of the bankruptcy (Maybe it was a Fugazi (fake) which was discussed earlier in the same episode), but nevertheless the trustee is likely to inspect that ring to make sure it is fake and if it is not then the trustee will likely liquidate it for the benefit of their creditors. I am sure there will be more news to come with regards to their bankruptcy.

Nevertheless, when filing a bankruptcy it is necessary to list all your assets and liabilities. Failure to do this can and may lead to prosecution by the Department of Justice for bankruptcy fraud (with stiff penalties of up to 5 years in jail and/or a $250,000 fine). Further, the trustee can and likely will object to the discharge of a person who undervalues assets or fails to list them in their petition and schedules. For a person to file a Chapter 7 or any bankruptcy they must fully disclose an accurate picture of their financial situation and explain the loss of income or property etc. In some cases the trustee may ask for proof of bank records, cancelled checks, or credit card statements. The failure to provide those documents can lead to an objection to the persons discharge. Further, if a person undervalues assets then the trustee has the right to get an accurate appraisal or value for the listed properties or even inspect them.

When a client comes into my office and asks what do I need to list? I say everything "ALL ASSETS and LIABILITIES" and I tell them that they cannot pick and choose what they list and do not list. Everyone will sign a disclosure required under federal law 527 (a) (2) which is to be given prior to retaining our office which states the above in no uncertain terms. When filing a bankruptcy with an Chicago Bankruptcy Attorney we would never put a client in a position to perjure themselves. Further, as an attorney I have a duty under the bankruptcy code to make all reasonable attempts to do due diligence with regards to the Debtor's assets and liabilities. As court opinions will often say, "bankruptcy is for the unfortunate debtor who cannot afford to pay their creditors back, but want too" almost all of the clients we see seek the protection of bankruptcy because they have no other alternatives other than a bankruptcy. Please call my office today for a free consulatation at 312-489-8182.

Marc Wagman

The Federal Trade Commission reports that complaints about debt collectors have risen 50% in 2009 and this year they expect a 13% increase over last years number of complaints See the Article. In addition, complaints of debt collectors using obscene or abusive language spiked 35% from last year. It is often my experience that when a potential client comes into my office and is behind on their bills they will tell me about the abusive practices of some of the collectors for their debts. Often it will be phone calls at work, phone calls to relatives, abusive language, threats to sue or send the sheriff out to arrest the person, divulging personal information to the person's employer, and constant phone calls at all times of the day and night.
Whether a person files a Chapter 13 Learn More about Chapter 13 or a Chapter 7 Learn More about Chapter 7 with a Chicago Bankruptcy Attorney like us, the creditors phone calls must stop. Once a person files the case an automatic stay goes into place which stops creditors from suing, collecting, or harassing you to pay any debts. The automatic stay is your protection from creditors.
Further, the Fair Debt Collections Practices Act or FDCPA provides a civil remedy for any creditor who uses abusive or deceptive debt collection methods. It provides for damages of $1000 for each violation, compensatory, and sometimes punitive damages, as well as attorney fee's Learn More about Creditor Harassment and the FDCPA from the FTC's website. Common violations of the statute will commonly be one of the following:

1. Threats to use violence to collect the debt, or abusive or profane language
2. Causing the telephone to ring excessively, to annoy or abuse the person, or calling after 9 pm at night or calling the persons employer and divulging personal information or defamatory information to a third party.
3. False or misleading representations by the debt collector (the person saying they are with a state agency or the police department, or an attorney etc).
4. unfair or unconscionable means to collect a debt
5. and the failure to validate the debt after an initial communication

As an Experienced Chicago Bankruptcy Lawyer I often hear from our clients that they want to pay their bills, but the vast majority don't have the ability to do so. I realize that if you had the money to pay your creditors you would not be speaking to us and that bankruptcy is usually your last resort. We will help you lose your debt while still maintaining your dignity! Please call my office for a free consultation at 312-489-8182!

Marc

Whether you file a Chapter 7 Learn More about Chapter 7 or a Chapter 13 Learn More about Chapter 13 either type of bankruptcy will stay on your credit report for 10 years. Nevertheless, filing either type of bankruptcy with a Chicago Bankruptcy attorney like us may help your credit score more than not filing a bankruptcy. One of the biggest reasons most people wait to file a bankruptcy is that they perceive that their credit will be destroyed forever and that they will not gain access to new credit. See Common Bankruptcy Myths However, with either type of bankruptcy if you are in default on your bills prior to filing your credit score is hurt each month by the defaults. Your credit score will drop each month by any negative or derogatory reporting by a creditor on your credit report. If you have missed a payment on a mortgage or missed payments or been late on bills your credit score will drop each month.
Further, if you have a high debt to income ratio then your credit score will be impacted and any creditor will take that into consideration on whether to grant any new credit to you. However, by filing a bankruptcy and eliminating any future negative reporting and eliminating debt creditors will view any new extensions of credit as a new foundation to build upon.

Often a potential client or client will ask how long before I get credit card offers or a home loan. Generally speaking a credit card can be had after the time of discharge or a few months after, same thing goes for a car loan. Purchasing a home usually takes around two years after the discharge. What matters most is what you do after the discharge. It is good to keep in mind that if your bills are in collections or you are behind on your bills your credit score is being hurt every month that you wait. If you are considering bankruptcy contact me I am an expererienced Chicago Bankruptcy Attorney so what are you waiting for call me at 312-489-8182!

Marc Wagman

When I am sitting in my car in traffic on the radio there is someone selling the idea of Debt Consolidation. I think to myself are people really falling for this v. filing a bankruptcy. The Wall Street Journal has an excellent article on Debt Relief offers Beware of 'Debt-Relief' Offers Click here to read the article. In the article it speaks about how much it can hurt your credit score more than a bankruptcy and it doesn't stop collections calls. A Bankruptcy is the only way to eliminate your debt with a Chapter 7 Learn More about Chapter 7 or a Chapter 13 Learn More about Chapter 13.

A bankruptcy will eliminate collections calls, stop a foreclosure, and eliminate credit cards and medical bills, and other types of debts. The automatic stay prevents any collection efforts through the power of a federal bankruptcy court. At my office, I am a licensed Chicago Bankruptcy attorney who is experienced in bankruptcy and I will represent you through the entire process.

My office isn't one of the mills who processes you just like another customer. At our office I will guide you through the process from start to finish. I will happily assist you and answer any questions you may have. I am experienced and affordable. I will treat you with respect through the entire process and I want you to lose your debt and still maintain your dignity. At my office you will never speak with a paralegal or a secretary who will answer questions that a lawyer only should answer. You can speak with us day or night regarding your concerns. We are affordable and I also have Saturday appointments. I serve Cook County, Kane County, Dupage County, and Will County clients at my three offices. Chicago Bankruptcy Attorney Contact Page Click Here to Contact Me Now or call me at 312-489-8182.

Marc Wagman
Attorney at Law

Major Warning signs: There is a foreclosure sale of the debtor’s home the next day or a foreclosure filed and proceeding; the debtor’s only car was mysteriously repossessed in the dark of lastnight (car repo); a garnishment has reduced the debtor’s take-home pay below the ordinary requirementsof food and rent. Instantaneous relief is need in the above examples. Foreclosure and Bankruptcy.

The problem sometimes becomes that clients will wait too long and waste precious time and precious and limited resources prior speaking with an experienced Chicago Bankruptcy Attorney. Waiting to long can and may lead to loss of income or loss of property that can be protected in the bankruptcy. That's why it is important to speak with me at the start of significant financial problems such as a loss of job, loss of income, garnishments, and collectors calls. Don't wait speak to me today at 312-489-8182!

Marc

When filing a bankruptcy either a Chapter 7 Learn More About Chapter 7or Chapter 13 Learn More about Chapter 13 a Debtor goes through the "Means Test" Learn More about the Means Test a provision changed by Congress in 2005 to determine under 11 USC 707 B 2 of the Bankruptcy Code whether the Debtor needs to file a Chapter 13 or a Chapter 7. In sum, the means test was written into the Bankruptcy Code by Congress based upon the perception that there are many people who should be filing a Chapter 13 instead of filing a Chapter 7. Congress perceived that some were abusing the relief provided under the bankruptcy code. No longer would your actual income and expenses determine your ability to file a bankruptcy.

The Means Test

The Means Test is a six month average of the Debtor's & Joint Debtor's household income derived from all sources for the six months prior to filing. An average of the money received from all sources in the last six months is calculated divided by six then multiplied by 12 and you have the Median Income of the Debtor (the mathmatical formula) (6 months income derived from all sources prior to the filing for six months divided by the six months and multiplied by 12) you come up with Median Income of the Debtor and his or her household. If that amount of money is below the income for the size of household in your state then you can file a Chapter 7. If the money is higher than the average size per your household in the state you are "presumed" to do a Chapter 13 paying in any "projected disposable income" over the next five years minus any legitimate deductions. After legitimate deductions (only deductions Congress prescribed in 707) the number determines the payment in Chapter 13 for a sixty month repayment plan.

Whats the problem with that?

The problem is what happens if the Debtors six month pre-filing average is either very high or very low. The end number to determine the payment may abnormally high or low. So Some people who cannot pay their debts end up being forced into an unrealistic Chapter 13 payment due to loss of Income that they no longer receive or they are paying to little to the creditors.

This is exactly what happened in the Supreme Court Case Hamilton v. Lanning, just decided a few days ago. The Debtor lost her jobs in the previous six months prior to filing and received a one time severance package just prior to filing. That income was a one-time occurence, but according to the means test that amount is calculated into your monthly average. She had a job paying lower than the median income post filing and that the previous amount of money pushed the Debtor into Chapter 13.

It fictionally made it appear that she had more money to pay her creditors. The Chapter 13 Trustee objected to her proposed repayment plan and said that she must pay her creditors based upon the income received in the last six months including her severance package without looking forward for her future income.

The Supreme Court said no, and

Held: when a bankruptcy court calculates a debtor’s projected disposable income, the court may account for changes in the debtor’s income or expenses that are known or virtually certain at the time of confirmation.

This means a great deal for Debtors who file bankruptcy. The process of filing of bankruptcy Learn more about the process became more difficult with the change of the laws. Courts all over the country mainly used the mechanical approach toward calculating future income (mechanical meaning in essence that a math formula was used to calculate the Debtor projected payments). Now with an experienced bankruptcy attorney who files bankruptcy in Chicago Experienced Chicago Bankruptcy Attorney the Debtor can argue that something either in the past or future should be considered by the court. I.E. a loss of income a one time withdraw from a pension, IRA, or a severance package etc. that should be taken out of the equation for calculating whether you should file a Chapter 7 or a Chapter 13. How to Choose a Lawyer Choosing the right lawyer is important now more than ever. At my office all I do is bankruptcy.

I am a Experienced Chicago Bankruptcy Attorney. I keep up to date with current case law and are aware of the requirements of the Bankruptcy Code for either Chapter 13 or Chapter 7. I will make the most of Chicago Bankruptcy filing whether Chapter 7 or Chapter 13 and help you navigate through this process as painlessly as possible. I want you to lose your debt and keep your dignity! Please call my office today for a free consultation at 312-489-8182!

Marc

Often, a potential client will call our office and ask "How much do you charge for a bankruptcy?" The question is almost impossible to answer without some questions of our own. Imagine if you will that you call a mechanic and say my car isn't running what will you charge to fix it? The mechanic will not know what is wrong by speaking with you over the phone or know if you need a new engine or your water pump is out etc. Or imagine, if you will you call a Doctor and say my back hurts what do you charge for back surgery. A Doctor cannot answer that question without you coming in and doing further tests and taking x-rays etc. The Doctor won't know if it is minor back pain or you need a disc replacement etc. The same analogies apply when a a potential client calls and says what do you charge for a bankruptcy? Generally, I can give a range of fee's; however, without asking some questions of my own, our office or any attorney cannot really answer the question without asking numerous questions and ideally to speak with you in person. That is why I offer a free consultation.

We will not know if you need a Chapter 7 liquidation bankruptcy Learn More about Chapter 7. Or if you need a Chapter 13 reorganization Learn more about Chapter 13 Reorganization. We will often answer the question of how much we will charge with numerous questions. Some of the questions we will ask are, Are you working?, Do you own real estate?, how much debt do you have?, What kind of Debt is it that you have? Do you own a business? Etc. Etc. A Chapter 7 or a Chapter 13 fee will vary on how complicated a case is and what the debts are. Numerous attorneys who dabble in bankruptcy advertise with a "flat fee" for bankruptcy and then add attorney fee's on a a la carte basis for any complexities in the case. Most of the time the person who uses them will be charged much more than the advertised "flat fee", and or they will be using an attorney who only dabbles in bankruptcy. Although any attorney can legally file a bankruptcy we often meet clients who used an inexperienced attorney to file their bankruptcy at their own peril. Bankruptcy is not a specialty practice; however, if the attorney does not regularly practice bankruptcy law then there are extreme perils for both the attorney and the Debtor. See Our Link on how to Choose a Lawyer

Using a "cut rate" attorney may lead to a client paying much more in the end. Also imagine that you hire the "cheapest doctor" for a surgery and not the "best". Do you really want to take a risk like that with you health? Should you take this risk with your financial health? I am an experienced Chicago bankruptcy attorney!

At my office you will only speak with an attorney, and never a paralegal or a secretary See Our Website. I only practice bankruptcy. Often times I will speak with a client and tell them call different attorneys and see what they say to you and see a few before coming to see me, because you should compare attorneys on a big decision such as filing a bankruptcy. I will go through your options other than filing a bankruptcy Alternatives to a Bankruptcy.

Please call my office today for a free consultation at 312-489-8182!

Marc Wagman
Attorney at Law

And more people are filing for Chapter 7 Chapter 7 bankruptcy, which liquidates assets to pay off some debts and absolves the filers of others. That is significant because a 2005 overhaul of federal bankruptcy laws aimed to encourage Chapter 13 filingsLearn More on Chapter 13, which force consumers to sign onto debt-repayment plans in exchange for keeping certain assets.

The changes were designed to make it more difficult for people to shed their debt, particularly in a Chapter 7 filing. A "means" test, Learn More about the Means Test for example, was introduced to separate those who could afford to repay their debt from those who couldn't. A Chapter 7 filing is off the table if the means test determines a person is able to pay back at least a portion of the debt after it is restructured.

The worst U.S. recession in a generation is testing the effectiveness of these laws. The economic downturn also has prompted more middle-class Americans to file for bankruptcy protection

Overall, personal filings hit 1.41 million last year, up 32% from 2008, according to the National Bankruptcy Research Center, which compiles and analyzes bankruptcy data. It is the highest level of consumer-bankruptcy filings since 2005. Consumers rushed to file in 2005 before the new bankruptcy laws took effect in October of that year.

Chapter 7 filings were up more than 42% as of November 2009, compared with the same period a year earlier, according to the research center. November is the most recent month with analyzed data available. Chapter 13 filings rose by 12% and made up less than a third of 2009 filings as of November.

"That suggests it was largely ineffective," Ronald Mann, a law professor at Columbia University, said of the 2005 overhaul. "I don't think anybody who's knowledgeable about the bankruptcy system thought the statute was well crafted."See Our Website to Learn More Swanson & Wagman Website.