The common wisdom is that is nearly impossible to discharge a student loan in a Chapter 7 bankruptcy. I recently saw a Florida bankruptcy case where a bankruptcy judge did order the discharge of a debtor’s student loan. Continue reading
A married man used exempt money from his retirement funds to pay off a $400,000 mortgage on his homestead. Within three years thereafter, the same man filed Chapter 7 bankruptcy. The Chapter 7 trustee is challenging the man’s homestead exemption because he (the debtor) obtained $400,000 equity within 1215 days of filing bankruptcy. Can the man’s non-filing spouse exert her homestead interest to save the house? Continue reading
A reader wrote me stating that she had filed Chapter 7 bankruptcy because a bank was suing her for the amount of her home mortgage. This was not a deficiency action. The bank sued the reader for default under the promissory note without foreclosing on the mortgage. Without foreclosure, the owner would keep her house but the bank would have a judgment against her personally. She filed Chapter 7 to stop the lawsuit. Continue reading
Is it ever possible for a Chapter 7 trustee to take a debtor’s exempt assets? The answer is “yes” in extraordinary cases. The issue was addressed in a recent bankruptcy court decision. Continue reading
People who receive money from Ponzi schemes usually have to return the money if the Ponzi organizer filed bankruptcy. The bankruptcy trustee typically pursues recipients of Ponzi profits as transferees of fraudulent transfers made by the Ponzi organizer. What happens when the Ponzi organizer donates part of Ponzi profits to a charity? Continue reading
A bankruptcy court can dismiss a Chapter 7 bankruptcy filing for “bad faith” even if the debtor passes the means test or is exempt from the means test because his debts are primarily non-consumer debts. A Florida bankruptcy court dismissed a Chapter 7 filing because the court found that the bankruptcy filing was not appropriate and was not consistent with the purpose of the bankruptcy code. Continue reading
A bankruptcy court today gave one of my bankruptcy clients a $10,000 judgment against one of his creditors for attempting to collect a debt after the entry of the debtor’s discharge. A key part of my client’s success was his detailed documentation of collection letters and calls as well as my own repeated written warnings to the creditor.
After the entry of the Chapter 7 discharge one of the creditors made several collection calls to the client/debtor. I wrote a warning letter to the creditor reminding it of penalties for collection of debts after discharge. The creditor sent bills and letters. I wrote another warning letter. Collection continued.
Seeing my letters being ignored I filed a Motion for sanctions and attorneys fees against the creditor. The creditor representative then wrote a letter of apology promising that there would be no more calls. Even after the apology and promise the creditor continued calling my client and even left a threatening voice mail message.
In court, my client produced “screen shots” from his cell phone showing phone calls from a phone number that matched the creditor’s phone. The judge was also very interested in listening to my client’s recording of the collection voice mail that was recorded with date and time of call. Continue reading
An attorney called me to ask whether he continue a residential eviction after the tenant filed Chapter 13 bankruptcy. The landlord’s attorney had already obtained a writ of eviction for non-payment of rent. Continue reading
Sometimes a creditor with a cause of action against a corporation will try to “pierce the veil” of the corporation to hold liable the owners of the company if the creditor believes the owners have significant assets. There is a different concept called “reverse piercing” when a creditor will try to attack a corporation and its assets to satisfy a claim initially brought against the individual owners. Continue reading