Charlotte Bankruptcy Blog

Posts containing useful information for anyone considering a North Carolina bankruptcy lawyer.

Your Charlotte Bankruptcy Lawyer

Strategizing Together

Choosing the right lawyer to assist you in filing a bankruptcy is important. Together with your Charlotte bankruptcy lawyer, you will examine your options and choose a path of recovery that will dramatically improve your life. That may involve filing a Chapter 7 bankruptcy or Chapter 13 bankruptcy. In the alternative, it may mean your lawyer reaching out to negotiate with a mortgage company or other creditors on your behalf. A lawyer who places your best interests ahead of their own will gather information from you, ensure you understand your options, and help you make a choice.

Listening

I have been practicing law for thirteen years and I’ve found that the most important thing I can do for my clients is listen to them. It sounds simple enough, but every client has a unique history and individual goals and objectives. My job is to talk to them until I understand their situation and we create clarity around their objectives. Then I strategize with them about how to get those objectives met. Typically that involves filing a personal bankruptcy, but sometimes there are other options.

Forming a Working Relationship

Together with your attorney, you will have an ongoing working relationship. It’s important that you and all clients are regularly kept abreast of the progress being made for them, so my clients and I never get off the phone without deciding when we will talk next. We also talk about what is going to happen between this phone call and the next. It helps set expectations and provides us the focus we need to move forward quickly.

Staying Updated

You should be getting updates from your bankruptcy lawyer on a regular basis and you deserve to speak to the lawyer handling your case. I answer my own phone. I enjoy talking to my clients. They’re good people. It’s also the only way to fully understand what is important to them and help them achieve it.

Regular communication is also a way for me to make sure that my clients haven’t gotten stuck while trying to gather information. Third parties like the IRS and creditors can be slow to respond, and it’s not uncommon for me to assist clients in gathering information. It’s part of the job. The goal is to get to the finish line together, as quickly as possible.

Celebrating

Choose your Charlotte bankruptcy attorney carefully. You will get to know one another. You will overcome hurdles together. In the end, together you will celebrate the accomplishment you’ve achieved, and the bright future that lies ahead for you.

Call today. I’ll answer my phone personally, and we can talk about your options. 704.749.7747.

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What Happens at the 341 Meeting?

Do I have to go to the courthouse?

Yes. You will typically have to go to the courthouse one time, for what is called a 341 meeting. This meeting takes place about 40 days after you file your Chapter 7 or Chapter 13 bankruptcy. If you file Bankruptcy in Charlotte, NC, your meeting will be at the Federal Courthouse which is located uptown. It’s remarkably easy to get to and we will provide you with easy directions to it.

What is the meeting for?

The 341 meeting is a meeting of creditors. Despite that, your creditors do not often attend. Typically the individuals at the meeting will be you, your Charlotte bankruptcy attorney, and the bankruptcy trustee who is overseeing your case.

Will I be put on the stand and questioned?

You will answer some questions under oath, yes. The meeting takes place in a small conference room. You don’t have to take the stand. Either way, being under oath is nothing to fear. Your obligation is simple: be honest with the trustee in the same way you were honest with me and my firm leading up to the filing of your bankruptcy petition341 .  And, we will prepare together for the types of questions you will be asked that day. Your bankruptcy attorney will be there to support you as well.

What types of questions will I be asked?

The trustee will ask you to confirm your address, your marital status and whether you’ve filed before. They will ask if you listed all your debts and if anyone owes you money. They will ask you about potential inheritance, and whether you stand to have a reward from a lawsuit if you have filed one. They are generally attempting to make sure the petition that was filed is an accurate portrayal of your financial situation. It’s my job to help ensure the answer is yes. That makes the 341 meeting easier for you, and shorter as well.

The trustee may also ask the bankruptcy attorney some questions. That is not uncommon. All parties are being asked to confirm that they are familiar with the contents of the petition and to tell the trustee if anything has changed since filing.

How long will it last?

The meeting will generally last about 10 minutes. Sometimes shorter, sometimes a little longer. Remember, weeks prior to this meeting when you filed your bankruptcy petition, your creditors stopped calling. After attending the 341—a very important step—you will receive your discharge in about 60 days. That means that in addition to the creditors no longer calling you, your obligation to repay the debt included in the bankruptcy is completely extinguished. Your fresh financial start has officially begun.

The process of going through a Bankruptcy can feel daunting. I can assure you that you are currently handling much more stress and anxiety than that involved with preparing for an attending a 341 meeting. You’re ready for this. Email me at [email protected] or call 704.749.7747 to talk about your options today.

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When to file bankruptcy in Charlotte, NC

Much like any substantial undertaking, it may never feel like the right time to file a bankruptcy in Charlotte, NCI know that you already value the health and welfare of your family over avoiding any negatives you’ve imagined will flow from filing a bankruptcy. In my opinion, when you are ready to act on that value with the help of an attorney, that is the day you take the first step and make a phone call to move forward with achieving the goal of financial recovery.

That is my goal. But what about living expenses leading up to filing? Can I continue to use my credit cards until the day I file?

Your long-term financial health will be restored by the filing of bankruptcy. You are right to insist on a plan for managing your short-term financial health. My clients and I always discuss how they are making ends meet today. We then talk about what changes they should or can make leading up to the bankruptcy filing, and the impact of those changes.

In addition to helping you successfully achieve a discharge of your debts, I consider it my job to help you figure out how to survive as we approach the bankruptcy filing. You can continue using your credit cards until the day you file. Ideally, clients wait to file until they have not used the cards for several months. We are not living in an ideal world. I can’t tell you the last time I reviewed a case like that.

So I can use the cards if I have to, but I need to be careful as to how I use them?

Yes. The Bankruptcy Code states that consumer debt totaling more than $500 for luxury goods and services owed to any one creditor incurred within 90 days of filing, or cash advances totaling $750 or more owed to any one creditor made within 70 days of the filing are non-dischargeable. This doesn’t mean you can’t file. It does mean those particular charges would not be included in the bankruptcy. Additionally, charges owed to a creditor that were incurred by false pretenses or fraud are not dischargeable.

What does this mean, practically speaking?

If you have charged more than $500 to one particular card within 90 days of filing, the “presumption of abuse” will arise and creditors will most likely object. The same $500 spread out over several cards may not trigger an objection. Regardless, if you have spent over $500 within 90 days on a card for non-luxury items (reasonable living expenses: food, electric bills, etc), I will argue against the presumption of abuse and most likely be able to achieve a discharge of those charges in a Chapter 7 or a Chapter 13, even though they occurred within the last 90 days.

I want to recover. What do I do next?

It’s easy. You call my office. I will personally answer the phone, and we will have a brief conversation about your situation. My hope is that after that conversation you feel more hopeful, more empowered, and more educated about your options. If filing a Chapter 7 bankruptcy or a Chapter 13 bankruptcy is in your best interest, I will be here to help you with that. The phone call is free. More importantly, it can change your life.

Please take the next step toward your true financial health. Email me at [email protected] or call me at 704.749.7747. My job is to help, if you’ll give me the chance to do it.

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Are Tax Debts Included In A Bankruptcy?

There are circumstances where it is permissible to include tax debts in a bankruptcy filing. This often makes a significant difference in the amount of relief to the client and the timing of the filing should be closely monitored.

Generally, there are three conditions that must be met in order to discharge tax liabilities in bankruptcy.

First: The liability in question must be at least three years old prior to the filing. To determine this we look to the year the debt was due PLUS any applicable extensions and their deadlines. From the most recent extension deadline, you count three years. If you file after that date, you can include the debt in the filing provided the next two conditions are met as well.

Second: The tax return for the tax year in question must have been filed at least two years prior to the bankruptcy filing. In other words, you cannot file a tax return for 1996 today, and then file bankruptcy tomorrow—the filing itself must be at least 2 years old, in addition to the requirements above. If however, you waited to file a 1996 tax return until 2010, you would be able to include the debt in a bankruptcy filing in 2012 or later provided the other 2 conditions are met.

Third: The taxes related to the debt in question must have been assessed at least 240 days prior to the filing. For example, if the filing is old and the taxes are old, yet you were just recently audited and as a result of the audit a tax was assessed, you would have to wait 240 days after the assessment to file.

Taxes are confusing enough when we are not in debt to the IRS. The addition of tax debt to a bankruptcy filing can often make a meaningful difference for the client. Please email [email protected] or call 704.749.7747 today for a free phone consultation to find out your options.

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Motion To Claim Exempt Property

When a personal finance matter turns into a legal matter, it’s time to act quickly. Our firms routinely assists clients who have received a Motion To Claim Exempt Property. Most clients are confused by the language used in the motion, and of course need guidance on what to do next. In one quick phone call, we can discuss the motion, and decide together how to respond.

If you receive a motion to claim exempt property, it is because a creditor has obtained a judgment against you. It should be regarded as a clear sign that the creditor is attempting to collect on the judgment. While that may cause anxiety, the Motion To Claim Exempt Property is actually reminding you that you have rights, and is giving you a chance to exercise those rights.

Once you receive this notice, you have twenty days to respond by filing a written response with the court. If you fail to file the response, you waive your right to the exemptions (protections) that the state offers. These protections are similar to the protections you have by law when filing a bankruptcy, so a bankruptcy attorney is the right person to speak to when you receive the motion.

With the help of an attorney, you can either fill out the form and submit it to the court, or you can file a bankruptcy petition which puts a stay on the collection process by notifying ALL creditors that you have chosen to file a Chapter 7 or Chapter 13 bankruptcy.

Equity in the following items is protected or exempted by the state:

Your residence: $35,000 (single) $70,000 (married)

Your car: $3,500

Miscellaneous items (“Wild card”): $5,000

Other household items: $5,000 (single) $10,000 (married)

Other—Some items like 401k through an employer or IRA accounts of your own may be entirely protected. Your lawyer can assist in making that determination for you

 Let me help you relieve some of this stress and move forward confidently. Whether you choose to file the response yourself, file it with an attorney, or file a bankruptcy with a lawyer in Charlotte, The important thing to do is ACT NOW. Call me at 704.749.7747 to discuss the options and decide today what’s best for you.

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Can I Keep My Home?

The North Carolina Homestead Exemption

Most people who call me about filing a bankruptcy in Charlotte want to know what will happen to their home if they file. Fortunately, the answer is usually a good one. North Carolina has something called a Homestead Exemption which protects some or all of the equity in your home.

For instance, if you are a homeowner filing separately, you can protect up to $35,000 in equity in your home. If you are married and filing for bankruptcy jointly, you can typically protect twice that, or $70,000. By way of example, if you own a home valued at $300,000, with a mortgage of $250,000 you can still file bankruptcy while keeping the home. This is great news to clients who want to stay in their home but eliminate medical bills, credit card debt and other types of debt which are discharged when you file a Chapter 7 bankruptcy.

In a Chapter 13 bankruptcy, you can typically keep your home even if your equity exceeds the $35,000/$70,000 exemption limits. Depending upon the equity that exists beyond the NC Homestead Exemption, your attorney can help you determine your monthly payment under a Chapter 13 bankruptcy, which would eliminate unsecured debt (credit cards, etc) while allowing you to keep the home.

If the options begin to sound complicated, that’s OK. Your Charlotte bankruptcy lawyer can easily walk you through them and help you decide the best option for you and your family. Call me today for a free phone consultation at 704.749.7747.

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Bankruptcy and Your Home

One misconception about bankruptcy is that you cannot go through a Chapter 7  bankruptcy or a Chapter 13 bankruptcy and keep your home. Generally, provided the home does not have significant equity, this is simply not true.

The filing of a Bankruptcy petition will put an immediate stay on foreclosure proceedings. This stay remains in effect until the secured mortgage holder is granted permission by the court to continue with the foreclosure, or until the Bankruptcy case is closed or dismissed. The stay on foreclosure created by the Bankruptcy can provide the necessary time the homeowner needs to sell the property or cure the default on the mortgage.

As an alternative to using the filing of a Bankruptcy petition to simply buy time, an individual can move forward with a Chapter 13 Bankruptcy plan that includes the home and accompanying mortgage(s), and allows the borrower to cure the default over the course of carrying out the Bankruptcy plan. In other words, the mortgage lender is treated similarly to other creditors in the plan, and once the final plan payments have been made and a discharge granted, the borrower is no longer facing foreclosure and remains in the home.

Second mortgages are given special treatment in Chapter 13 Bankruptcy. In circumstances where more money is owed on the first mortgage than the home is worth, the second mortgage can often be treated as an unsecured creditor. The effect of this treatment is that, like other unsecured creditors (credit card companies, etc), once the debtor completes the plan and receives a discharge, the second mortgage is extinguished. The homeowner remains in the home, continues paying on the first mortgage, and the second mortgage is “stripped off” of the property and discharged along with other unsecured debt.

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