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 chris@thelaytonlawfirm.com or call me at 704.749.7747. My job is to help, if you’ll give me the chance to do it.

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 a 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 the 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 chris@thelaytonlawfirm.com or call 704.749.7747 today for a free phone consultation to find out your options.

Creditors are relentless in their pursuit of money. Remember, they are doing whatever the law will allow them, and they will continue to do so until the debt is paid. With late fees, high interest and penalties. You can stop collections calls today.

Suffering doesn’t make sense. With the banks’ unwillingness to be flexible or give you some additional time, what does make sense is for YOU to bring stability back into your life by taking whatever steps the law allows. Knowing your rights can change your life quickly and dramatically. A bankruptcy attorney can help.

Did you know: Filing a bankruptcy with the court puts an automatic stay on collection calls and other collections activities including foreclosure. This means the day you file your Chapter 7 or Chapter 13 bankruptcy, you get instant relief—no more threatening phone calls.

Did you know: After the bankruptcy is filed, creditors who contact you in an attempt to collect on a debt are breaking the law. If you do get phone calls after filing, you should immediately let your bankruptcy lawyer know: you may now have a case against the creditor for violating the rules associated with the automatic stay!

Did you know: You don’t have to notify the creditors yourself. Your attorney can notify your creditors on your behalf, and in the alternative, the court provides notice to creditors upon the filing of the bankruptcy.

After a brief phone consultation with your Charlotte bankruptcy attorney you will be well on your way to relief. Call 704.749.7747 today to get free information quickly. The future can be different and one call can make that difference.

When a personal finance matter turns into a legal matter, it’s time to act quickly. I got a call yesterday from an individual who received a Motion To Claim Exempt Property. He was confused by the language used in the motion, and of course wanted guidance on what to do next. In one quick phone call, we discussed the motion, I asked a few questions about his finances and we decided together how to respond.

If you receive this document, 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.

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.

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.

There are two primary reasons I recommend a Will. First, if you have minor children, a Will provides direction as to the care of those children after your death. Second, with a Will a person has control over how and to whom his or her property shall be distributed after death.

Anyone can create their own valid Will. Most lawyers are hesitant to tell you this. The reason to consider having a lawyer assist with drafting your Will and other Estate Planning documents is that in order to carry out the wishes of an individual, certain legal language recognized by North Carolina courts is required. A lawyer familiar with the Estate Planning laws of North Carolina will help ensure the following items are handled consistent with your objectives:

The care of your children — A Will contains provisions naming Guardians who will care for your children in the event you (and your Spouse) should pass away.

The care of your assets — A Will directs the disposition of certain assets (Real and Personal Property) in the event you pass away. Your choices will probably differ from the state’s ‘default’ disposition of those assets should you pass without a Will.

Your healthcare decisions — An effective Estate Plan includes a Healthcare Power of Attorney, which names individual(s) of your choosing, who will be entitled to assist in making healthcare decisions for you in the event you cannot make those decisions on your own.

Your financial decisions — An effective Estate Plan includes a Financial Power of Attorney, which names individual(s) of your choosing, who will be entitled to assist in the handling of finances in your name, should you be alive but unable to handle those affairs on your own.