New Year’s Resolution — File Bankruptcy Now

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New Year’s Resolution – File Bankruptcy Now

If you are thinking that the only thing that could make this year worse than last year is to stay buried in debt, it is time to file bankruptcy. You deserve the fresh start that filing bankruptcy provides, and our office can help.

Both Chapter 7 and Chapter 13 offer amazing and powerful relief from creditors, in exchange for providing detailed information about your income and assets. Whether you are considering a Chapter 7 liquidation or a Chapter 13 reorganization of debt, our office can assist.

A Fast And Easy Bankruptcy Filing

When you file with our firm, we make a point of streamlining the process leading up to the bankruptcy filing. This means all of your documents can be submitted through our online portal, and documents can be signed electronically as well.

Generally, we will need tax returns, vehicle registrations, bank statements and a few other documents in order to prepare your bankruptcy filing. If you are facing a foreclosure or vehicle repossession, we can file an emergency bankruptcy prior to obtaining that documentation. This halts the process and gives you immediate relief from creditors.

A Lawyer And Staff That Cares

Our firm knows the anxiety associated with financial stress, especially as jobless claims increase across the state. Our goal is to provide you relief from that stress. We know the bankruptcy filing will give you financial relief; however, you will find our compassionate and diligent approach refreshing. We know lawyers have a reputation of being ‘stuffy’. You will not find that at The Layton Law Firm. Instead, you will experience quality conversations, routine updates on your case, and you will come away with the confidence you need to start fresh.

Speak With A Charlotte Bankruptcy Lawyer Today

If you are ready to move forward, or just have questions, we are here. You can reach us at 704.749.7747 or click HERE to request a consultation by phone. All consultations are free and answering questions is part of the job. We know you have choices. We hope you choose Layton Law.

 

 

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Filing A Restaurant Bankruptcy

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Filing A Restaurant Bankruptcy

As Covid-19 rages on and restrictions for public gatherings ramp up, restaurants in Charlotte and the surrounding area—as well as the country—continue to feel the pain. Many restaurant owners indicate they are at a breaking point financially. During a time when sales are supposed to be highest and restaurants can make up for slower months, the exact opposite is happening.

We speak with small business owners every day regarding their financial predicament. This of course includes restaurant owners. What many small business owners are surprised to find out is that filing a restaurant bankruptcy can be the secret ingredient to future success.

Your Business Can Continue

The options in bankruptcy for restaurant owners have increased with the Small Business Reorganization Act. Together with Chapters 7, 11, and 13, most restaurant owners can find a bankruptcy solution which fits their particular needs.

The primary decision you will need to make is whether the business is going to continue to operate. If it is not, your bankruptcy lawyer will assist with a dissolution of the business in conjunction with the bankruptcy filing. If the business is going to continue, it can do so under either a Chapter 7, 13, or Small Business Reorganization. Chapter 11, an expensive bankruptcy option, is not usually required for a restaurant that is filing bankruptcy.

A recent article in the Philadelphia Inquirer makes specific mention of the concern business owners have regarding continuing operations. Particularly, the article addresses the concern regarding dealing with suppliers. Typically, suppliers will continue to work with you; however, they may require you to pay COD until you prove yourself with them over time.

You Can Protect Your Assets

The bankruptcy code allows for assets to be exempted from creditors. The ability to preserve assets is different depending upon the Chapter you are filing, and your bankruptcy lawyer will work with you to determine your asset exemption needs when strategizing which bankruptcy route to take.

There are some assets which are exempt from creditors in bankruptcy in an ‘unlimited’ amount—401k and retirement savings, for example—so it is important to speak with a bankruptcy lawyer before you start depleting those assets to keep your business running outside of bankruptcy.

Speak With A Charlotte Bankruptcy Lawyer Today

If you own a small business or restaurant, we are here to help. Speaking with someone about your options not only helps ease the anxiety and fear you are feeling, but also provides you with clear direction regarding your options. We know you have put your life into the business; bankruptcy can help you save it.

To speak with an attorney, call 704.749.7747 or click HERE to request a phone consultation. All consultations are free and can be conducted over the telephone.

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Mortgage Foreclosure Moratorium and Mortgage Forbearance In NC

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Mortgage Foreclosure Moratorium and Mortgage Forbearance In NC

The mortgage foreclosure moratorium has been extended to December 31st, 2020. This means even if you are delinquent on your mortgage, your lender can not move forward with foreclosure until the moratorium passes. Additionally, forbearance options exist for those having trouble making their payments due to COVID-19.

Mortgage Forbearance Options

As of late October 2020, North Carolina homeowners need to apply for forbearance relief by December 31st, 2020. Mortgage forbearance is available through the Federal CARES Act for homeowners who have financial hardship as a result of COVID-19.

Length Of Mortgage Forbearance Options

Per the CARES Act, the mortgage company must provide forbearance relief for up to 180 days upon request. Borrowers are then allowed to request an extension of the forbearance for up to another 180 days.

Contact Your Mortgage Provider

The smartest thing you can do regarding forbearance and the upcoming expiration of the moratorium is to contact your mortgage service provider. It is by speaking with them that you will discover your options, and prepare for how the deferred payments will be addressed once you come out of forbearance.

Lenders are not permitted to demand the delayed payments be paid in a lump sum. To be clear, the debt does not go away. You will plan with your lender for repayment with an increased monthly mortgage payment spread out over a length of time agreed upon by your mortgage provider.

Bankruptcy After Forbearance

If you come out of forbearance and realize you will be unable to make your increased mortgage payment, you may fall behind on the new payments. If the lender moves forward with a foreclosure proceeding, you can use bankruptcy to save your home by filing a Chapter 13 bankruptcy which allows you to catch up on your missed payments. You may also decide that Chapter 7 is a better option for you depending upon the equity in the home and your goals regarding home ownership.

Speak With A Charlotte Bankruptcy Lawyer Today

Our firm helps homeowners save their homes from foreclosure every day. Call us for guidance and we will help you understand your options before it is too late. You can reach us at 704.749.7747 or click HERE to request a phone consultation.

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How Long Does Bankruptcy Take?

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If you have an emergency situation, our firm can file a bankruptcy for you within 24 hours. However, we do not recommend filing bankruptcy that quickly unless it is absolutely necessary. A few examples would be to stop a foreclosure sale or to prevent a vehicle repossession.

If you are not in an emergency filing situation, a bankruptcy typically can be filed in about 30-45 days, depending upon how quickly you would like to move forward. We cater to your needs, so if you would like to file more quickly, we can certainly assist with that.

Phase I – Gathering Information

Working with our firm is easy. We simplify the process as much as possible and do our best to minimize the documentation you need to provide for filing. You will have your choice between completing an online questionnaire or providing info over the telephone. Documentation can be uploaded electronically or delivered to the office in paper format. While every case is unique, you generally need to provide proof of ID, two years of tax returns, six months of bank statements, and registration cards for vehicles.

Phase II – Reviewing Your Petition

With the information we gather in Phase I, we prepare a rough draft of your bankruptcy petition. The bankruptcy petition is a document meant to disclose your financial picture to the bankruptcy court. The key to a successful bankruptcy filing is disclosure. We will provide you with a draft of the petition and review it with you for accuracy and completeness.

Phase III – Signing and Filing The Petition

The bankruptcy petition must be signed prior to being filed. Fortunately, the Charlotte bankruptcy court is allowing electronic signatures and electronic filing. This makes the process quite seamless and easy. Once the petition is filed, the court will assign a bankruptcy trustee to the file. The trustee will review your petition prior to the 341 meeting.

Phase IV – The 341 Meeting

The 341 meeting is a short meeting between you, us, and the bankruptcy trustee. These hearings are held either on the phone or in person. The trustee will ask you a few questions about the petition they have reviewed. The trustee will also ask if there are any changes that need to be disclosed. You may be surprised to know that creditors very rarely attend the 341 meeting.

Phase V – Discharge

After the 341 meeting, there is a necessary waiting period meant to give creditors time to file their claims with the court. Once the deadline for this filing passes, the trustee will close your case and the bankruptcy court will enter your discharge. This is the true end of the bankruptcy and the final step in the process.

Speak With A Charlotte Bankruptcy Lawyer Today

Considering filing bankruptcy? Give us a call. A short conversation can restore your belief that there are brighter financial times ahead. We love answering questions and we are here to help. You can reach us at 704.749.7747 or click HERE to request a call.

 

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Bankruptcy For Medical Bills

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Bankruptcy For Medical Bills

You can file bankruptcy for medical bills. Not only will your medical bills be discharged by the bankruptcy, but you other existing unsecured debt will be discharged by filing bankruptcy as well. While this is sometimes referred to as a Medical Bankruptcy, there is no specific legal term for this. It simply signifies that the primary reason you are filing bankruptcy is due to your medical bills.

Your Medical Bills Must Be At Least 90 Days Old

At the time of your bankruptcy filing, your medical bills must be at least 90 days old. This refers to the date of service which gave rise to the medical bills. If the bills are less than 90 days old at the time of the filing, the medical creditor can assert their rights through the bankruptcy by filing an objection to discharge, or in the alternative, that their bill should survive the bankruptcy. Because of this, we often discuss health concerns with our clients who want to file a bankruptcy due to medical bills. If you have an upcoming surgery or large medical expense, we may choose to strategically wait to file your case until after the date of service is more than 90 days old.

Medical Bills Due To Personal Injury

North Carolina can be a challenging state when it comes to medical bills in a personal injury claim. Many times, a personal injury settlement will not address one hundred percent of your medical bills. This means you find that you have settled your personal injury claim for as much money as you can, yet you have remaining medical billing related to the injury. Filing a bankruptcy for medical bills will address the remaining medical billing associated with your personal injury.

Assets And Income Still Matter

As with any bankruptcy, if you file a bankruptcy for medical bills, you still need to pass the income and assets test in order to file a Chapter 7. Our office will work hand in hand with you to determine if you can file a Chapter 7. In the alternative, a Chapter 13 is almost always an option.

Alternatives To Filing Bankruptcy

Often, our firm represents clients in debt settlement or debt negotiations. It may be that the client can not file bankruptcy or does not want to file bankruptcy. In any case, as a bankruptcy firm, we hold special leverage against creditors in the negotiation process. Often, this leads to a great result for the client.

Speak With A Charlotte Bankruptcy Lawyer Today

If you have questions about whether bankruptcy clears debt, we are here to help. Call us at 704.749.7747 or click HERE to request a free phone consultation. We know you have choices. We hope you choose Layton Law.

 

 

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How Much Does Bankruptcy Cost?

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How Much Does Bankruptcy Cost?

The cost of a bankruptcy will depend on which Chapter you file. In North Carolina, the cost for a Chapter 13 is set by the court. The cost for a Chapter 7 bankruptcy depends upon the law firm and the specifics of your case.

Chapter 13 Fees

In the Western District of North Carolina, a Chapter 13 bankruptcy is $4,500.00. However, you will most likely not need to pay all of this up front. Each law firm requires a different ‘up front’ (pre-filing) amount to be paid. The remainder of the fees are built into your Chapter 13 plan and are paid monthly to the trustee as part of your ongoing Chapter 13 payment.

By way of example, if you paid $2,000.00 up front before filing, it would leave $2,500.00 to be paid through your plan. If your Chapter 13 plan was 60 months, that equates to roughly $41.50 per month to be built into your Chapter 13 plan.
Your full monthly Chapter 13 payment will depend upon a few factors, including your monthly income and expenses and any priority debt you have. You can read more in our article How Much Will My Chapter 13 Payment Be?

Chapter 7 Fees

While most firms have a standard base fee for Chapter 7 filings, each Chapter 7 is different and requires a different amount of work to be done by the law firm. We do our best during the Free Consultation to discover any specific items which may entail additional work by the firm. A few items which may dictate your Chapter 7 fee are whether you have judgments which need to be addressed, or if we anticipate an objection by a creditor. Lastly, if you have assets which cannot be exempt in bankruptcy, it is reasonable to assume we will need to negotiate with the trustee in an attempt to preserve as many of those assets as possible.

Unexpected Attorney Fees In Chapter 7

There are rarely unexpected attorney fees in Chapter 7. The representation agreement outlines some standardized fees for performing certain tasks, should they need to be performed. Our goal is for each client to know the full extent of attorney fees prior to moving forward with our firm and prior to filing the bankruptcy case. We accomplish this by having thorough conversations with clients and potential clients, in order to discover the full breadth of the bankruptcy filing.

Speak With A Charlotte Bankruptcy Lawyer Today

If you want to know how much filing bankruptcy will cost, we are happy to discuss it with you. We can be reached at 704.749.7747 or you can request a free consultation HERE. We know considering bankruptcy can be stressful. Our promise is to be the support you need as we work to help you take the next steps toward freedom from debt. We know you have choices. We hope you choose Layton Law.

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What Happens To My Mortgage If I File Bankruptcy?

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What Happens To My Mortgage If I File Bankruptcy?

If you own a home and file bankruptcy, you can keep your home and mortgage secured by the mortgage. Depending upon whether you file Chapter 7 or Chapter 13, the course of events that follows the filing of the bankruptcy will be slightly different. One analysis which must be done relates to the equity in your home. Generally speaking, you are allowed $35,000.00 in equity per spouse to keep a home in Chapter 7. This known as an Exemption. In Chapter 13 you can have additional equity beyond those limits; however, it will affect your Chapter 13 payment.

Your Mortgage In Chapter 7

If you own a home with a mortgage and you file Chapter 7, it is important that you are current on your mortgage upon filing the Chapter 7, or by the time of the 341 hearing at the very latest. If you wish to keep the home in Chapter 7, you will continue to make mortgage payments to a bankruptcy department at the mortgage company while the Chapter 7 case is active. Once the case closes, you will resume making payments to the mortgage company in the same manner you did prior to filing.

It is important to note that the filing of a bankruptcy technically discharges the debt (mortgage); however, unless you are planning to surrender the property in bankruptcy, you will need to continue to make mortgage payments.

Unlike reaffirmations for car loans, mortgage debt is very rarely reaffirmed in bankruptcy. Courts frown upon it in an attempt to protect debtors who have recently received a discharge from substantial debt. The American Bankruptcy Institute has written at length about this stance.

If you do not reaffirm your mortgage, provided you stay current on mortgage payments post-bankruptcy, the mortgage lender has no recourse. You keep the house as long as you keep making payments. You receive credit against your balance for all of your payments, and you build equity presuming the value of the house continues to increase.

One downside to not reaffirming a home is that the mortgage company will not report your payments to the credit bureaus. Your remedy for this is to send a letter once a year to each credit bureau indicating the payments you have made. If the creditor fails to file a response disputing that you made the payments, you will get credit for the payments on your credit reports.

One tremendous upside to not reaffirming a mortgage in Chapter 7 is that if you lose your job, the house value is ‘upside down’ in the future, or for any other reason you wish to walk away from the house (and the debt) you can do so. The lender is limited to receiving the property as their only recourse. They can not pursue you for any remainder debt on the home in the event they sell it for less than what you owe on it.

Your Mortgage In Chapter 13

In Chapter 13, you can also keep your home and mortgage, provided you continue to make payments as usual. Additionally, may clients use Chapter 13 as a way to force the lender to let them catch up on missed payments. Your Chapter 13 plan will propose to pay the normal mortgage amount, plus a small amount each month for the purpose of catching up on missed payments over a 60 month period. When the Chapter 13 bankruptcy closes out after 60 months, your mortgage will be deemed current.

Due to the ability to use Chapter 13 for the purpose of catching up on missed payments, many clients use Chapter 13 to avoid a foreclosure. A Chapter 13 can even be filed as an emergency filing, in order to stop a foreclosure. So long as you make ongoing payments in Chapter 13 under your confirmed Chapter 13 plan, the mortgage lender has no choice but allow the Chapter 13 to move forward. Additionally, you will be obtaining a discharge of unsecured debt in Chapter 13.

Old Mortgage Debt In Bankruptcy

If you have old mortgage debt on your credit, a Chapter 7 or Chapter 13 filing will address that debt and your discharge will include it. If your current mortgage is a burden you can surrender your current real estate to the lender in bankruptcy, and the lender will be limited to the home as repayment of their debt– the bankruptcy filing will prevent them from pursuing you as an individual if the sale of the property leaves a remainder balance on the mortgage debt.

Speak With A Bankruptcy Lawyer Today

If you are facing foreclosure, or would like to consider bankruptcy for another reason, we are here to help. Our clients who own real estate are able to file bankruptcy every day while keeping their home. We can show you how. If you would like a consultation you can call 704.749.7747 to speak with an attorney today. Or you can click HERE to request a consultation. All consultations are free and can be done over the phone. We know you have choices. We hope you choose Layton Law.

 

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Inventory And Equipment In Bankruptcy

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Inventory and Equipment in Bankruptcy

A common scenario is emerging across the country, and one which we are addressing in our office with many potential bankruptcy clients. As small businesses further feel the impact of Covid-19, business owners are wondering where—if any—the outlet valve is for them, financially.

The Small Business Catch-22

There is a catch-22 in a small business bankruptcy scenario, in that the business may be providing enough money for the owner and their family to operate their personal household, but not enough money to pay the expenses required to keep the business going.

While this scenario may have been somewhat tenable for restaurant owners and other small business owners during the moratorium on foreclosure and eviction, those days are nearly over. As courts re-open in North Carolina, foreclosures, evictions, and creditor lawsuits will move forward. Without an influx of income or some other relief, this will no doubt place business owners in an untenable position.

The business owner wants to continue to operate the business to bring in necessary income to live off of, but they cannot keep up with the mounting debt and invoices.

How Can Bankruptcy Help?

The type of debt you carry will be a key factor in how your small business will be affected by a bankruptcy filing. Second, the value of your business inventory and assets will be a factor. If your business debt is unsecured debt, you may be able to protect your equipment and inventory from creditors in a bankruptcy. Lastly, you can exempt or protect some of your business inventory and equipment in bankruptcy, if it has value above and beyond what is owed to creditors who have liens against it.

Many of our small business clients elect to file Chapter 13 bankruptcy. So long as you pay your creditors the value of your unexempt business inventory and equipment over the life of the Chapter 13, you can operate your business during bankruptcy. As your business recovers and income increases, it is true your Chapter 13 payment may increase, but you always have the option of dropping out of or dismissing your Chapter 13 bankruptcy if you have recovered enough to enable you to pay your bills.

Secured Creditors

If your debt is secured by inventory or equipment, those secured creditors will take priority over other creditors. They will be entitled to either the equipment, or payment up to the value of that equipment. Depending upon whether the secured creditor was a purchase money creditor, or a general line of credit creditor who took a security interest in equipment you already owned, we can advise how that debt and equipment will be treated in a bankruptcy.

Back Rent In Chapter 13

Chapter 13 offers you the ability to stop an eviction by a landlord, if you show you will be able to pay rent going forward, while slowly making up the missed rent in your Chapter 13 payments. Chapter 13 is typically a 60 month plan, so your back rent is paid over that 60 month period while you continue to make your normal rent payments. The length of your lease will be a factor, as well as whether your landlord has already obtained an order in the eviction process. The end of the moratorium on evictions certainly make the likelihood of filing to avoid eviction a reality.

Walking Away From The Business In Bankruptcy

If you are ready to walk away from the business, you may qualify for a Chapter 7 or a Chapter 13. While this means you would most likely file bankruptcy and dissolve the corporate (business) entity, there is nothing to stop you from forming a new company on the heels of bankruptcy and doing business again under a new name.

Speak With A Charlotte Small Business Bankruptcy Lawyer Today

Call today if you have questions about your small business, equipment and inventory in bankruptcy, or other concerns. The consultation is free, and we are here to help. We can be reached at 704.479.7747. Or, you can click HERE to request a free consultation.

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Bankruptcy Is Not A Four Letter Word

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Bankruptcy Is Not A Four Letter Word

Currently, both bankruptcy and Covid-19 are spreading quickly. As we begin to see Fortune 500 companies file for bankruptcy due to Covid-19, it is a great time to remind ourselves that bankruptcy can be viewed as a business decision. In fact, filing bankruptcy is what saves many companies and enables them to thrive in the market post-bankruptcy. It is too early to tell whether companies filing bankruptcy now will bounce back; however, historically we do know that companies like Apple, General Motors, and Hostess all successfully bounced back with the help of a bankruptcy filing.

There are also famous individuals who filed bankruptcy and went on to great success. This was long before bankruptcy and Covid-19, but among them are Walt Disney, Donald Trump, and Abraham Lincoln. These individuals understood that bankruptcy is not  a four letter word. If anything it is more akin to a seven letter word: F-R-E-E-D-O-M. The day you file bankruptcy is the day you play your ace card against oppressive creditors and accumulating debt.

Bankruptcy Is The First Step To Recovery

One common concern regarding a bankruptcy filing is how long it will take you to bounce back from bankruptcy. Truthfully, it is the bankruptcy filing that is the first step in recovery for a business or individual. The bankruptcy filing brushes back creditors and forces them into a plan the company can manage while they continue to conduct business. The same is true of a personal bankruptcy filing.

From the day you file bankruptcy, you get relief from creditors. They are no longer allowed to pursue you for collection of debts, or legal actions against you related to debt. As a result, you can finally breathe again. Your income is no longer being shoveled to creditors whose balances do not seem to move despite significant payments each month. Instead, you can use those funds to pay for the needs of yourself and your family. If you file a Chapter 7 bankruptcy, you will receive a discharge of your debts. If you file a Chapter 13 bankruptcy, you will enter into a re-payment plan which quite often requires you to pay less than 10% to your creditors spread out over a five year period.

As one of our favorite clients said in a recent review of the firm “Chapter 7 and Chapter 13 are just that: Chapters. They are not the entire book!”

Treat It Like A Business Decision

You can choose to view a bankruptcy filing as a business decision—or at least a financial one—for you and your family. Smart business owners put their emotions aside and do what has to be done for the health of the company. Most of our clients realize that bankruptcy is not an emotional experience; however, they do confess that it was their emotions that kept them from filing sooner. Unfortunately, this means months or years of payments to creditors on debts which are ultimately discharged in bankruptcy. If you act quickly, you can avoid spending any additional money on unsecured debt which will be addressed with one bankruptcy fee and one bankruptcy filing.

The bankruptcy court has remained open despite Covid-19, allowing debtors to move forward with their financial recoveries. Most hearings are done over the telephone at this time, which is a great convenience for all parties and a wonderful solution as the courts are busier each month with bankruptcy filings.

Take The Next Step

The next step is simple. Call us to speak with an attorney. The call is free and you deserve to understand your options. We can be reached at 704.749.7747. We are happy to answer questions about bankruptcy and Covid-19. Or, you can click HERE to request a consultation by filling out a very short form.

Watch A Short Video

If you’d like to know a little more about the firm, watch this short one minute Introductory Video by Chris Layton. We know you have choices. We hope you choose Layton Law.

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What Happens To My Car In Bankruptcy?

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What Happens To My Car In Bankruptcy?

If you own a car or lease a car, you will need to decide what happens to your car in bankruptcy. You have the choice to keep your car and the debt associated with it, or you can choose to surrender the car in bankruptcy. This means the car goes back to the lender, and the debt goes with it. There are one or two exceptions, which we will address. In summary, you can either keep the car and the debt, or ‘get rid of’ the car and get rid of (discharge) the debt.

How Can I Keep My Car In Bankruptcy?

If you want to keep the car in a Chapter 7, you will need to be current on payments by the date of your 341 meeting. You will sign a Reaffirmation Agreement with the lender, which will contain the same terms you had prior to the bankruptcy. The reason for the agreement is the filing of your bankruptcy technically relieves you of the obligation to repay the loan; however, if you want to keep the car, you will need to renew the agreement. The Reaffirmation Agreement accomplishes that.

If you want to keep your car in Chapter 13, you can do so. Your interest rate may decrease due to the interest rate set by the bankruptcy court. Additionally, if you have had the vehicle for more than 910 days, you may be able to lower the balance on the loan in Chapter 13, which can be a tremendous benefit.

How Do I Surrender My Car In Bankruptcy?

If you want to surrender the car and the debt, it is easy. We file your bankruptcy and reach out to the car lender to make arrangements for them to pick up the car or have you drop off the car in the alternative.

You Have Options

The upside to addressing a car in bankruptcy is that you have options. Most clients are incredibly happy with the results of bankruptcy including the ability to have flexibility regarding vehicles. The rules of bankruptcy heavily favor the debtor—the person filing—and as a result, if you would like to keep a vehicle while discharging all unsecured debt, it is almost always an option.

Speak With A Bankruptcy Lawyer Today

If you would like to speak with us about what happens to your car in bankruptcy, you can request a free consultation. Just call 704.749.7747 or click HERE to request a time to talk. If you would like to watch a short video from Chris Layton, it may help you make a decision regarding working with us. We know you have choices. We hope you choose Layton Law.

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