Tag Archives: Bankruptcy Code

DALLAS TEXAS BANKRUPTCY: REPAYING LOANS TO FAMILY MEMBERS

by

Leave a comment

Dallas Texas Bankruptcy: One of the more unfortunate results of filing bankruptcy occurs when a debtor has made payments to a family member to repay a debt prior to filing bankruptcy.  Section 547 allows the Trustee to avoid any transfer of an interest of the debtor in property made within 90 days before the filing of the petition or up to one year prior to the filing if the transfer was made to an insider.  This means that if a debtor borrows money from a family member and then repays a portion or all of the debt during the year before they file bankruptcy, the Trustee may require that the family member turn over those funds so that they can be disbursed to the creditors in the bankruptcy case.  The purpose of this section is to prevent debtors from showing preference to creditors who are related to them.  Section 547 attempts to provide equality among all of the unsecured creditors.

 

Setting aside these types of payment can create problems within families and anxiety for both the bankruptcy debtor and their family member.  But keep in mind that there is no law or rule that says that a debtor cannot repay a debt to a family member after they complete their bankruptcy.  Debtors who are concerned about how their family member will be affected by their bankruptcy case should reassure the affected party that they will be paid back.

BANKRUPTCY: JOINT DEBTOR VS. CO-DEBTOR

by

Leave a comment

These two very similar sounding terms have very different meanings.

The term joint debtor describes the second person listed on a bankruptcy petition when a married couple files bankruptcy.  The first person listed on a bankruptcy petition is the debtor.  There is no rule in the Bankruptcy Code that states either the husband or wife must be the debtor or joint debtor.

 

In bankruptcy, a co-debtor is someone who doesn’t file bankruptcy, but is liable for debts that are included in a bankruptcy because they share liability for the debt with a bankruptcy filer.  For example, if you are married and have incurred debt with your spouse you are both jointly liable for that debt.  If your spouse files bankruptcy, and you don’t, then you are a co-debtor in a bankruptcy case.

BANKRUPTCY: WHAT IS A 341 MEETING?

by

Leave a comment

A 341 meeting, also known as a creditor’s meeting, is presided over by the United States Trustee, and allows creditors and the trustee an opportunity to question debtors about the schedules and statements filed in their bankruptcy case.  This meeting is required under 11 U.S.C. § 341 of the Bankruptcy Code, hence the name.  Creditors are not required to attend the meeting, and in most consumer cases they do not.  In Chapter 13 consumer bankruptcy cases, the only creditors that generally attend the 341 meeting are representatives of the Attorney General when the debtor pays child support and the Internal Revenue Service when the debtor owes taxes.

 

Trustees use this meeting to question the debtor regarding their assets and financial situation in order to determine whether or not to file an objection.  The 341 meeting also starts the clock on several deadlines.  In a Chapter 7 bankruptcy case, creditors have sixty days following the 341 meeting to object to discharge.  In a Chapter 13 bankruptcy case, secured and unsecured creditors have ninety days following the 341 meeting to file a claim in order to receive payments from the trustee.  The meetings generally last between five and fifteen minutes.  For most debtors the 341 meeting is the only hearing that they will have to attend while in bankruptcy.

The Bankruptcy Code Provides Extra Help to Disabled Veterans

by

Leave a comment

In 2005, The Bankruptcy Code was revised, making it more difficult and sometimes impossible for many debtors to obtain relief under Chapter 7 of The Bankruptcy Code.  Disabled veterans were excepted from some of the new eligibility requirements that affected most debtors.  If you are a disabled veteran who became disabled while serving your country, and your debts were primarily incurred during a period of active duty/homeland defense activity, you may be eligible for a discharge under Chapter 7 without having to satisfy the other requirements under the Means Test.  What does this mean?  It means that because of your status as a disabled veteran, you may qualify for a Chapter 7 discharge even if your income would usually disqualify you from receiving relief.

Why File Chapter 13 Bankruptcy?

by

Leave a comment

North Texas debtors file Chapter 13 Bankruptcy for many different reasons, but in general debtors are seeking two forms of relief in Chapter 13 Bankruptcy.  The first form of relief offered by the bankruptcy code is the automatic stay.  The automatic stay is sometimes described as a gate closing, locking out the creditors.  Basically, the idea is that once a bankruptcy case is filed, creditors can no longer attempt to collect debts.  The automatic stay prevents creditors from repossessing vehicles and foreclosing on homes, and the Chapter 13 Plan gives debtors a way to come current on their arrears, so that they can keep their secured property.  The second form of relief available in Chapter 13 Bankruptcy is a discharge.  A discharge means that creditors are barred from collecting on the debts listed in the bankruptcy schedules, unless the debtor has indicated in their bankruptcy plan that the debt should survive the bankruptcy, such as when a person who files a bankruptcy wishes to keep a home or car.  The debt doesn’t disappear, meaning that creditors can still attempt to collect the debt from other parties liable for the debt who did not receive a discharge.  A discharge occurs when a debtor successfully completes their Chapter 13 Plan.  Plans last between 36 and 60 months, although the vast majority of debtors file 60 month plans.  After the last payment is made, assuming all other requirements under the bankruptcy code have been met, the debtor will receive a discharge.