A Chapter 7 bankruptcy trustee is supposed to gather and sell all non-exempt personal property of significant value. Sometimes there are practical considerations that lead most trustees to leave valuable assets for the debtor. Continue reading
I received an inquiry from prospective bankruptcy clients who had moved to Florida from New York just over six months and had purchased jointly a Florida homestead. The wife had substantial unsecured debts and wanted to file Chapter 7 bankruptcy. The couple was concerned that their homestead would not be protected under Florida’s homestead exemption in the wife’s bankruptcy because they had lived in Florida less than two years and could not use Florida exemptions. Continue reading
Withdrawals from your IRA or other tax deferred retirement accounts is part of income for purposes of calculating eligibility for Chapter 7 bankruptcy under the means test. Many debtors facing bankruptcy are using retirement income to survive financially, and some debtors over 70 ½ year of age are required to take minimum retirement distributions. Planning retirement distributions intelligently is important for bankruptcy qualification. Continue reading
When someone borrows money from another person and then is unable, or simply unwilling, to pay back the loan the lender can feel that the borrower stole his money or defrauded him out of money. Can a creditor challenge the Chapter 7 bankruptcy discharge of a personal loan on the basis of theft, fraud, embezzlement, or like theory? I read a recent bankruptcy decision that discussed when non-payment of a loan amounts to a theft or fraud. Continue reading
There are several bankruptcy court decisions which considered the debtor’s homestead exemption when the debtor used part of the homestead property to produce income. The general rule is that commercial uses on a homestead property situated within a municipality will disqualify all or part of homestead exemption, but income producing activity does not disqualify homesteads located in the county. Continue reading
People who receive distributions of money from Ponzi schemes usually are expected to return the money to a trustee who takes over the operation when the Ponzi organizer files bankruptcy. The trustee usually attempts to “claw back” money distributed to the investors, especially money representing winnings or profits. This recent Florida bankruptcy case produced a slightly different result for a Ponzi investor. Continue reading
A potential bankruptcy client wanted to avoid a deficiency judgment from a partially first mortgage on his home. The client’s income made him ineligible to file Chapter 7 bankruptcy which would have discharged the deficiency liability in full. The client had heard that filing Chapter 13 bankruptcy could also eliminate the deficiency claim completely.