Should Filing Bankruptcy Be The Last Resort? Filing Bankruptcy Now Could Be Your Best Option

After I got off the phone with a prospective client, my law partner questioned me about something he had overheard me say to the prospect. Really he criticized me for telling the prospect that bankruptcy should be used as a last resort. After we talked a little bit about the notion, I have to say I agree that in most cases filing a Chapter 7 or Chapter 13 bankruptcy should not be used as the last resort. Continue reading

More Individuals Qualify To File A Chapter 7 Bankruptcy Than You Might Think

There is a lot of misinformation out there as to who can and who cannot file a Chapter 7 bankruptcy. Some people will lead you to believe that since the passage of the new bankruptcy laws in 2005, only individuals with extremely low incomes can file a Chapter 7. This is another bankruptcy myth that needs to be dispelled.

First off, what is a Chapter 7 bankruptcy?

A Chapter 7 bankruptcy is designed to eliminate a debtor’s dischargeable debt. Some debt may not be dischargeable such as student loans, domestic support obligations, and certain taxes, but unsecured debt, including credit cards, medicals bills, club memberships, and deficiency balances, is typically dischargeable.

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Bankruptcy Fraud – Misleading The Court Can Get You In Big Trouble

A forty year old man in Iowa, Keith Chapman, recently pled guilty to bankruptcy and tax fraud admitting that he made false statements in bankruptcy proceedings for Chapman Lumber. According to the Associated Press as reported by the Chicago Tribune, the Court records indicated that Mr. Chapman diverted more than $450,000 from the company to a bank account and used the money for his personal benefit, including a country club membership, jewelry, golf equipment, clothes, and other items.

Mr. Chapman faces up to 13 years in prison and fines up to $750,000. You can read about other cases involving bankruptcy fraud at the Bankruptcy Fraud Resource Center. The Internal Revenue Service website also publishes real examples of bankruptcy fraud investigations.

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Foreclosures in Pennsylvania – One in 230 Homes – Below National Average

Many of you have probably read or heard about the recent staggering statistic regarding the number of foreclosure filings that have been filed nationally in the first two quarters of 2009 – one in 84 U.S. homes had a filing during that time according to RealtyTrac of Irvine, California, which tracks foreclosures nationwide. Well, the Philadelphia Enquirer published the rankings for Pennsylvania and New Jersey in its July 17, 2009 article “Foreclosure filings rise as unemployment takes toll”: Pennsylvania ranked 31st among the 50 states in number of filings (one in 230 homes), and New Jersey was 21st (one in 146 homes).

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Bankruptcy and Sports

There have been quite a few news stories lately about sports stars who have filed for bankruptcy relief, along with even a sports team considering filing bankruptcy . The major league ballclub, the Chicago Cubs, is considering filing a Chapter 11 bankruptcy as part of closing the sale of the team by its parent Tribune Co. You can read the July 13, 2009 article in the Chicago Tribune here. If the Cubs seek bankruptcy relief, it would be the first team to file in nearly four decades. Continue reading

Is Bankruptcy Getting a Bum Rap?

I am not one to discourage people from seeking alternatives to filing bankruptcy, but most of the “alternatives” are not all they are cracked up to be. Advertisements and articles are popping up everywhere offering alternatives to bankruptcy, and the only thing I can say to that is if it is so easy to fix financial problems, why are so many people in such bad financial situations?

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Philadelphia Foreclosure Diversion Program’s Success Story

It has been one year since Philadelphia instituted its pilot mortgage-foreclosure diversion program.  So far, according to the numbers published in the Philadelphia Inquirer on July 1, 2009, the following statistics have indicated that the foreclosure diversion program has been quite successful:

  • Number of participating homeowners: 5,000
  • Foreclosures averted: 1,400
  • Sheriff’s sales postponed for more discussion: 700

You can read more about the program here. Continue reading