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Five Of The Most Common Causes Of Bankruptcy

Not that long ago it was thought that if you filed bankruptcy you were bad with your money, or living above your means. There used to be a certain social stigma that went along with filing for bankruptcy, because your peers looked at is if you had failed somehow in budgeting or had overspent. But fortunately that is no longer the case, and a countless number of people who are struggling to make ends meet are able to get out of debt by filing for the protections offered by the bankruptcy laws. That said, there are still a lot of questions about what leads to the need to file for bankruptcy, because when we know the causes we might be able to find alternative solutions or have a better understanding of what is needed during a bankruptcy case.

Five of the most common causes of the need to file for bankruptcy include the following:

• Divorce: when a couple gets divorced and one household turns into two it is more than just the furniture and personal items that have to be divided. Debt also has to be divided and when two households have to be supported on the same salaries, it can be hard to make ends meet. This may be why a bankruptcy case is one of the most common companion cases to a divorce.
• Medical bills: healthcare costs are exorbitantly high and if you do not have health insurance or have a policy that requires you to pay a large sum out of pocket before your benefits kick in, it doesn’t take long for medical bills to add up to an amount that is not manageable for most people.
• Credit card debt: most credit cards have high interest rates and if you only make the minimum payment each month you will get nowhere fast on the outstanding balance. When you have multiple cards, you will end up owing a lot of money that is not always easy to pay back.
• Job loss: the economy has made victims of a lot of American workers, and that means thousands upon thousands of people are unemployed. Without gainful employment it is hard to pay the bills, and bankruptcy becomes the only option for a lot of consumers.
• The economy: not only are good jobs scarce, but the cost of living in general is on the rise. Employers are not able to keep up with the increased cost of living and that means many people are stuck at a salary that does not cover all of their expenses, even when no new expenses have been taken on.

Whatever your circumstances, we are here to help. Our team of bankruptcy professionals will let you know your options, and help you to feel comfortable with the decision to file bankruptcy.

For more information about bankruptcy, contact us at www.DsouzaLegalGroup.com.

Three Main Purposes To Filing Bankruptcy

Never having enough money to pay all of your debts every payday is stressful. If you are in over your head, let us help you find a way out. There are ways to get out of debt and to put an end to the collection calls, letters, and lawsuits. You can ask for a mortgage modification to lower your house payments, giving you some breathing room each month. Or, you can negotiate with your creditors for lower interest rates which will make your payments more manageable. And you can also file a bankruptcy case, which might give you the most bang for your buck.

Three of the biggest benefits and the main purposes for filing for bankruptcy are:

• To end garnishments and other collection activity against you. When you file a bankruptcy case your lenders are no longer permitted to sue you for past due debts. In fact, your lenders are not even allowed to contact you to ask for payment once you file a bankruptcy case.
• To save your home from foreclosure, which can be accomplished in both a Chapter 7 and a Chapter 13 case. A bankruptcy will put a stop to a pending foreclosure, and within that bankruptcy case you can make arrangements to pay for your house and allow your family to stay in the home.
• To eliminate or reduce debt. In a Chapter 7 you get to wipe out all of your unsecured debt and in a Chapter 13 you only have to pay back a portion of what you owe on those debts.

But perhaps the biggest reason to file a bankruptcy case is to discharge your debts. When a discharge is entered the debts are no longer considered due. That means you will not be asked to pay them back, unless you made an agreement in your case to keep making the payments. Discharge is the ultimate goal in a bankruptcy case, and it is easy to get there if you just take the first step and file a case. If you need help getting back on track with your budget, call us today.

For more information about bankruptcy, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.

What Documents Do I Need To File A Chapter 7 Bankruptcy?

A Chapter 7 bankruptcy case does not last as long as a Chapter 13 case, and certainly does not require you to repay any portion of your unsecured debt. But just because a Chapter 7 case is a shorter way to get your debts discharged, that does not mean the preparation is any less involved. The same documents needed to prepare a Chapter 13 case are typically needed to prepare a Chapter 7 case. Knowing what to bring with you to an initial attorney meeting will make the process go smoother, and will give you more confidence that you will get a good result in your case.

The documents needed to have a Chapter 7 bankruptcy case prepared and filed are:

• Proof of income, which you can show by providing pay stubs.
• Income tax returns are also used to show income, and should be provided along with pay stubs.
• Documents showing home ownership will act as proof of what real estate is titled in your name, and is something the Trustee and your attorney will need to know.
• Car titles not only let the Court know what autos you have, but who the lender is and whether that lender took the proper steps to note their security interest in your car.

Gathering these documents can take a while, but when you put in the time to get them all ready and list out what you make vs. what you pay each month a clear picture is painted about your financial needs. And that is what is needed to determine what type of case you are able to file, along with giving you the proper advice about your case. When information is left out of a case it is hard to have it added later, and may even cause the Court to ask that your case not proceed. We know how hard it is to stay on top of overwhelming debt, and we can fix that for you when you give us the information needed. Our goal is to file a case for you that gives you the financial relief you need to start fresh.

For more information about bankruptcy, contact us at www.DsouzaLegalGroup.com.

What Documents Do I Need To File A Chapter 13 Bankruptcy?

Filing bankruptcy can be a paper intensive task. The documents and information required to file a case come from you, the debtor, and can take a while to gather. So if you are having a hard time paying all of your bills, take the time now to get some of the things needed to file a bankruptcy case together so you can act fast to get the relief you need. Once you have all of our documents in hand, it is time to sit down with a knowledgeable bankruptcy attorney and talk about your expectations from the process. In a Chapter 13 you should be prepared to remain in your case for up to five years, but know that if you are able to pay off the Chapter 13 Plan earlier you are permitted to do so without penalty. You should also be prepared to have at least one meeting at the courthouse with the Trustee, and he or she will ask to see certain papers.

The documents needed to file a Chapter 13 case include:

• 6 months’ worth of pay check stubs, to show your current income level.
• The past few years’ worth of income tax returns, including the most recently filed return.
• The deed or mortgage to your home.
• Car and boat titles.
• An accurate list of all the people you owe money to, along with the account number and balance due.

These are the things needed to get a case started and once the case is filed, you will then need to show up to Court to answer questions of any creditors that decide to be present, and also respond to any question posed by the Trustee. Most creditors keep their questions limited to what you plan to do regarding their specific debt and property, such as whether you plan to keep the collateral that secured their loan and keep paying, or whether you are going to give up the collateral. The most common types of lenders present are house and car lenders. The Trustee will ask a few simple questions about your reasons for filing bankruptcy, and your residency status. The Trustee will also need to see proof of identification, so be sure to bring in a valid ID to the Courthouse. After this initial meeting, you usually do not need to come back to Court, but will have to make your monthly Chapter 13 Plan payments to the Trustee, so funds can be disbursed to your lenders according to your repayment plan.

For more information about bankruptcy, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.

Common Bankruptcy FAQ’s

Filing for bankruptcy can save you a lot of money, can stop pending collection actions, and can wipe out or reduce some of your debts. But the process is complex, and before you make a final decision on whether filing is right for you, it is a good idea to have some general background knowledge. Talking with an experienced bankruptcy attorney is helpful, and having a list of questions or concerns will help you to better understand how the system works and what you can expect when your case is filed.

Some of the most common bankruptcy FAQ’s include:

• What is the difference between a Chapter 7 and a Chapter 13? The difference is that in a 7 you are allowed to eliminate all of your unsecured credit card debt while in a Chapter 13 you will be required to pay back at least a small portion of this type of debt. Another major difference between the two is the time it takes to complete a case, and how much you will have to pay if you want to keep your car.
• What is the automatic stay and how does it help me? The automatic stay is a legal mechanism, put in place the instant your case is filed, that makes it unlawful for your lenders to contact you about debts that are owed. It is also against the law for a lender to sue you for a past due debt when the automatic stay is in place, or to continue garnishing wages or bank accounts.
• What is the discharge? The discharge is the official entry by the Court that your debts are no longer due. A debt that has been discharged is not one that a creditor can try to collect, and if they try to do so you can hold them accountable for violating the discharge order.
• Who decides what chapter of case I am eligible to file? When your paperwork is prepared part of those documents include completion of a means test calculation.

Your disposable income is compared to your secured debt load, and depending on the result you will be eligible to file either a Chapter 7 or a Chapter 13. The test is a difficult one to perform, but when you let a qualified bankruptcy attorney take on your case you can rest easy knowing it will be done correctly.

We know you have a lot of questions, and we have the answers you need. For help getting your money troubles under control, consider bankruptcy and let us handle the case for you.
For more information about how to manage debt, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.

Why Do I Still Have To Pay For Some Debts Even In Bankruptcy?

Bankruptcy is supposed to get rid of your debts, right? Well…it depends on what type of case you file and what plans you have for your property. If you want to hang on to certain things, you will still have to make the payments for those items. And most times the payments are made after you sign new paperwork with the lender, within your bankruptcy case, promising to keep paying. The process is referred to as reaffirmation, and it is how most people keep their houses and cars when they file for bankruptcy.

Common debts that are still required to be paid even in a bankrupt situation are:

• House payments
• Car payments
• Payments for collateral you’ve given the lender a security interest in when the purchase was made (in some instances this might include a television or furniture bought on credit at the store rather than with a credit card)

Even when you have to pay back some of your debts, filing bankruptcy is a good way to fix your finances. In a Chapter 7 case you will be able to completely wipe out your unsecured credit card debts, and in a Chapter 13 you will be allowed to pay the value of your car at a lower interest rate rather than paying the balance on the loan at the contract rate of interest. The savings on these things makes it easier for you to pay the rest of your bills and maybe even put some money aside for when an emergency arises. When you file for bankruptcy you also get the benefit of the automatic stay, which prohibits creditors from taking certain actions against you. Among the prohibited actions are continued garnishments, actions to foreclose on your home, and attempts to repossess you auto. The peace of mind that comes with knowing you will not lose part of your money to a garnishment or will not be forced out of your home, or on foot if your car is repossessed is a huge benefit. If you are behind on your monthly obligations, let us help. We will let you know what type of case you qualify to file, and how it can benefit you.

For more information about how to handle overwhelming debt, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.

Stars Who Got “Real Jobs” After Financial Hardship

The life of a celebrity looks appealing, mostly because they seem not to have as many day to day worries as the rest of us. Most importantly, the stars always seem to have enough money to live on, and most times, they live in lavish home and take luxurious vacations. However, not everyone who has ever been on TV, in a movie, or had a pop song top the charts gets to stay on top of their game. When a celebrity is no longer in demand, their money starts to dwindle just like yours, and many stars have had to find other types of work in order to keep the dollars rolling in.

Here are just a few stars who got “real jobs” after the big paychecks stopped:

• Frankie Muniz: he was Malcolm in the Middle during his youth, but when the popular television show came to an end Muniz took up race car driving.
• Jon Gosselin of Jon and Kate Plus Eight fame started waiting tables in order to make ends meet when his “fifteen minutes of fame” ended.
• Brittany Ashton Holmes was the age of a typical kindergarten student when she “made it big” in the Little Rascals, but she went on to college and took a job not unpopular with most college kids, working at Starbucks. No word yet on whether Holmes approved of the Unicorn Frappuccino.
• Chris Owen, who had a somewhat starring role in American Pie was not able to cash in on his character’s success in those movies and had to resort to being a sushi waiter to make money.
• Josh Saviano who starred alongside Neil Patrick Harris on the Wonder Years was long rumored to be shock rocker Marilyn Manson but the truth is Saviano turned in his script for legal books and became a lawyer.

Some of these jobs are not typical “real jobs”, but are a far cry from the world of lap and luxury most celebrities enjoy. It just goes to show you that whatever your job, money is something everyone needs to survive. If your money is tight, you do have options. Call us to find out more.

For help with your questions about finances and how to keep them in check, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that help get you back on your feet.

How Bankruptcy Can Play A Role In Your Financial Planning

Having a solid financial plan is a good way to feel secure, and face the future with confidence. But not all of us are able to pay all the bills on time, and more often than not the average working American struggles daily to make ends meet. Rather than continue living paycheck to paycheck or wondering how to keep the lights on, take action to put an end to your financial distress. The best way to do this is to come up with a budget, stick to it, and be open to alternatives when facing severe financial problems.

Bankruptcy can play a role in your financial planning, and here are a few ways how:

• When you file bankruptcy you get to eliminate or reduce the debts you owe.
• Once you owe less, you can put more money towards other bills and get them paid off, or at least current.
• When you no longer have to pay certain things, you can take those expenses out of your monthly budget. Having fewer things to pay each month makes it easier to pay the things that remain.
• Saving becomes easier when you have money left over after paying the bills each month.

The idea of bankruptcy is that you will get a fresh financial start. And who wouldn’t like a do-over, or get to start again with a clean slate? The credit counseling that is required of all people who file bankruptcy will help you identify where your budget got off track, so that after your case is over you can avoid repeating the same behavior that led to your financial problems. The hope is that going through bankruptcy will not only get you out of debt, but keep you out of debt later in life. The money lessons learned during a bankruptcy case can last a lifetime, and can help you pay off debt, establish a savings account, and be more prepared for a financial crisis in the future. If you are having a hard time paying your bills and want to start over, let us help you. We will give you the information you need to decide if bankruptcy will work for you, and help you be successful during and after your case.

For answers to your questions about debt, contact us at www.DsouzaLegalGroup.com.

Can The Trustee Stop Me From Filing A Bankruptcy Case?

If you are behind on the majority of your bills, you might be thinking about filing for bankruptcy. But, you might also be wondering if there are any obstacles to filing a case and if so, how those obstacles can be successfully overcome. One of the biggest concerns for most people who file for bankruptcy is whether their case will be accepted by the Court. There has been a lot of buzz in recent years about eligibility to file bankruptcy, and changes to the laws that allow for a case to be filed. The changes were significant, and it is good to question how those changes affect your chances at filing a case.

After 2005, if you file a bankruptcy you will have to first determine which chapter you can file. This is done by putting your finances through the wringer, by way of performing a statutory test that tells whether you have enough money left over after paying secured debts, to pay any part of your unsecured debts. If so, you will be required to file a Chapter 13, and if you file a Chapter 7 instead you might face pushback from the Court and possibly the Trustee assigned to your case. The Trustee cannot stop you from filing a case, but does play a role after your case is filed. Here are some of the things to watch out for:

• A challenge by the Trustee to your case. If you have filed previous cases, the Trustee might object to you filing a new one.
• The Trustee might also as that your case be dismissed if you fail to provide his office with requested documents.
• If you file a Chapter 13 and fall behind on the Chapter 13 Plan payments, the Trustee will ask the Court to dismiss your case and deny you the relief of the bankruptcy laws.

While the Trustee is a disinterested party, he does have a lot of power. This alone can cause most people to be intimidated when facing the Trustee, but when you have a qualified bankruptcy attorney at your side, there is nothing to cause you worry. Our office has experience helping people get out of debt by filing bankruptcy, and can help you too.

For more information about bankruptcy, contact us today at www.DsouzaLegalGroup.com. We will go over the facts of your case and let you you’re your next step.

What Is A Proof Of Claim?

When you file for bankruptcy, you have to list out all the debts you have, and give all of your lenders notice that you have filed a case. Once your lenders are made aware of the filing, they are entitled to ask what you intend to do regarding their particular debt. If you have filed a Chapter 7 this might mean that you will be asked if you are going to reaffirm the debt, and in a Chapter 13 case your lenders will have the chance to review the plan of repayment your propose and either agree to the terms or object to what you are suggesting. Another part of a Chapter 13 case that involves your creditors is the filing of a proof of claim.

A proof of claim is a filing, made by the lender, setting forth the details of your account with that specific lender. Most claims include the following data:

• The nature of the loan, meaning identification of what property was purchased with the loan proceeds.
• The principal balance due, and at what interest rate that balance is being paid.
• The normal monthly payment for the loan.
• A separate proof of claim might be filed for any past due amounts, this is referred to as an arrearage claim.

You have the chance to object to the claims filed in your bankruptcy case, and challenge the balances being requested. It is not always a good idea to take the lender’s word for it, and if your records show a different figure it is in your best interest to object to the claim. The Trustee assigned to your Chapter 13 case will need to know how much is owed, and to whom, in order to properly administer your case. One of the most commonly objected to claims is a claim filed by a mortgage company. Most mortgage companies file claims that include extra fees and expenses, and it can be difficult to tell exactly what these amounts are for and whether they are actually due. When we handle your bankruptcy matter, we make sure the claims filed are in line with what you show as being due, and if there is an error, we take the necessary corrective steps.

If you are considering filing bankruptcy to help eliminate debt, contact us at www.DsouzaLegalGroup.com.