Archive for August, 2008
Wednesday, August 20th, 2008
While many might be on vacation, I was too busy to pull together a Storm Preparation for today. I did however manage to find a few news items.
Remember Filene’s? This gaping hole– which looks like England after WWII – is about a block from my office. Like many of my clients, this development project is struggling. But the silver lining is that I can tell clients exactly where my office is so long as they can find this gaping hole.
It’s only a flesh wound! University of Michigan researchers say if we’re in a recession, it’s a mild one.
From Time Magazine: Apparently, there are really stupid ways to pay for an education.
LA Times: Remember that “landmark housing bill” the President signed last month? It might not work out the way they hoped.
I imagine that’s how the folks who dug that hole at Filene’s feel.
Tags: In the News, Recession, Student Loans, The Hole in the Ground
Posted in Uncategorized | No Comments »
Friday, August 15th, 2008
It’s a question I have been asking myself of late. A Short Sale is when a lender (the mortgagee) agrees to release the mortgage from the property so that it may be sold to a buyer for less than when is owed on the mortgage. I am hearing that many people are exploring short sales as a means of “avoiding foreclosure.” But there are many variables that will make a short sale successful, and unless all of those variables are working in the homeowners favor, the short sale is not a good idea.
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Tags: Bankruptcy, Mortgages and Foreclosures, Short Sales
Posted in Bankruptcy, Consumer Rights, Debt Settlement or Consolidation | No Comments »
Thursday, August 14th, 2008
Every now and then, I get a call from someone who already has a bankruptcy case pending. Sometimes, they do not like how things are going with their attorney. Other times, they don’t have one at all and find that they are in over their head. And sometimes, by the time they are calling me, they find themselves in what can best be described as a world of hurt. Today, I received such a call.
The debtor’s chapter 13 case was filed almost two months ago. There is still no plan filed. No post-petition mortgage payments have been made. The debtor just got served with a summons and complaint because not all creditors were properly listed on the schedules (and I’m not sure the matrix was done right). The IRS has filed a notice that prepetition tax returns have not been filed. There are motions for relief from stay from secured creditors, and from the tone of them, they seem frustrated. No plan payments have been made, and the creditors meeting is soon. I am also assuming that no tax returns or payments advices have been sent over the chapter 13 trustee. In addition, by looking over the schedules, it appears that the debt is too high for chapter 13 eligibility. After I got all that from reviewing PACER, I decided to ask an easy question first:
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Tags: Bankruptcy, bankruptcy attorney, Chapter 11, Chapter 13, Homes, homesteads and real estate
Posted in Bankruptcy, Chapter 11, Chapter 13 | 1 Comment »
Wednesday, August 13th, 2008
I write the Storm Preparation series for those folks out there who are considering bankruptcy but just aren’t there yet. I know they are out there because they tell me – usually weeks and months after following this blog (and doing their own research and homework) and getting the courage (or in some cases a summons to appear which prompts them) to call. This week’s blog is for those out there who are considering chapter 13 in order to save their home. And it’s specifically for some of the people out there who are struggling with the very real and undeniably painful prospect of losing their home. So when I say “you”, that’s who I am speaking to.
For the last several years, our financial system has been propped up with (to steal a quote from Elizabeth Warren) ‘chewing gum and bailing wire.’ Our economy grew because homes became ATMs (we also had a war…or two…but that discussion is for another day…and maybe another blog). Some people used their ATMs to acquire luxuries. But not everyone used their home equity to buy those high end items. Others used it for necessities. Others like you.
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Tags: Storm Preparation
Posted in Bankruptcy, Chapter 13 | No Comments »
Monday, August 11th, 2008
May a debtor propose a chapter 13 plan that provides for the payment of mortgage arrears with regular monthly payments followed by a balloon payment at the end of the plan?
So far, the answer is still no (although the issue is still working its way through the courts).
In the recent case of In re Carman out of the Massachusetts Bankruptcy Court in Worcester, the court found that a debtor could not propose a plan that paid the mortgagee interest only payments throughout the plan period, followed by a final balloon payment. “Such a modification is impermissible in that ‘once periodic payments to that creditor commence, a subsequent balloon payment would be unequal to those that preceded it.’”
Until we get word from the appeals courts, this issue will remain a potential road block for debtors who hope to fund their plan with a sale or refinancing (or other source of funds that they do not have access to now). When I say “road block”, I mean “road block to getting a chapter 13 plan confirmed.” And until this issue is resolved by the appeals courts, it should also be read to mean “a potential road block to keeping your house.”
In re Carman, 07-44271, US Bankruptcy Court, District of Massachusetts at Worcester, July 25, 2008
You may have missed:
Did Congress Pop the Balloon?
Tags: Chapter 13, Homes, homesteads and real estate, Modifications and Workouts, Mortgage and Foreclosure
Posted in Bankruptcy, Chapter 13 | No Comments »
Thursday, August 7th, 2008
One of the goals of BAPCPA (the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005) was to prevent abuse by debtors. One of those abuses targeted were “repeat filers” and another was the failure to file documents. If schedules and other documents are not timely filed, the court is obligated to dismiss the bankruptcy case. A debtor out of the Northern District of Alabama recently learned what happens when you do not adhere to the requirements of the code.
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Tags: Bankruptcy Abuse Prevention & Consumer Protection Act of 2005, Chapter 7
Posted in Bankruptcy, Chapter 7 | No Comments »
Wednesday, August 6th, 2008
We are passing this information along. People who attend are encouraged to let us know how or if they found the help they need.
HOPE NOW Alliance in partnership with NeighborWorks® America, The New England Patriots Charitable Foundation and the Federal Reserve Bank of Boston will host a foreclosure prevention workshop at Gillette Stadium on Tuesday, August 12, from 1:00 PM – 8:00 PM. This event is an opportunity for homeowners who are in financial distress, or concerned about foreclosure, to sit down with their lender face-to-face, and avoid foreclosure if possible.
Borrowers can talk face-to-face with their lender and housing counselors to work out a plan for their mortgage.
Tuesday, August 12, 2008
Gillette Stadium
Fidelity Investments Clubhouse, East
One Patriot Place
Foxboro, MA
Free Parking and Public Transportation: Free transportation is available on the Commuter Rail from both South Station and Providence for borrowers attending the event. Borrowers must show the flyer to qualify for free transportation.
Click here for the flyer
Tags: In the News, Modifications and Workouts
Posted in Debt Settlement or Consolidation | No Comments »
Wednesday, August 6th, 2008
Many people over withhold taxes on their paychecks. In other words, they have more taken out so that come April 15, they will expect a nice refund rather than having to pay more to Uncle Sam. But over withholding can make preparing for a bankruptcy filing a little difficult. First, over withholding is not a good idea to begin with. And secondly, the money you’re withholding (and will ultimately get back) must be considered as part of your monthly income.
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Tags: Storm Preparation, Taxes and Tax Returns
Posted in Bankruptcy, Chapter 13, Chapter 7 | No Comments »
Friday, August 1st, 2008
One of the focuses of my bankruptcy practice is litigating Adversary Proceedings. I came across a case out of the Northern District of California. The first sentence under the heading of “Summary of Facts” read: “[t]his adversary proceeding is a poster child for some of the practices that have left to the current crisis in our housing market.” Clearly, this was something I had to read – and share with you.
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Tags: 523(a)(2): Fraud, Adversary Proceedings, Bankruptcy, Chapter 7
Posted in Bankruptcy, Chapter 7 | No Comments »
