A bankruptcy blog containing useful information for anyone considering a Charlotte bankruptcy attorney.

If you have an ongoing personal injury lawsuit, or a potential personal injury lawsuit, you must disclose it when filing your bankruptcy. This does not mean you will lose the personal injury awards in bankruptcy. If your injury occurs after filing your bankruptcy, generally the lawsuit and any award you may receive from it are exempted from the bankruptcy estate and the proceeds are yours to keep.

Compensation and Filing of Bankruptcy

Compensation Received Prior To Filing—If you’ve received compensation for your personal injury prior to filing your bankruptcy, your compensation is part of the bankruptcy estate and must be disclosed. Your bankruptcy attorney may be able to exempt or protect some or all of the compensation.

Compensation Received After Filing—You must disclose the existence of the personal injury claim or potential claim when filing your bankruptcy. Depending upon the facts, likelihood of recovery, and ability to value the claim, the Trustee will then make a determination as to whether to pursue the claim on your behalf, work with your existing personal injury attorney, or abandon the claim from the estate altogether.

Disclosure Is Key

In any case, if your injury took place prior to the filing of the bankruptcy, you must either disclose the compensation you have received, or in the alternative, disclose the potential for compensation. This puts the Trustee on notice and keeps you in compliance with the federal rules of bankruptcy. You’ll work with your bankruptcy attorney when filing your petition, and when preparing to discuss the claim with the Trustee.

If you have any questions about bankruptcy or personal injury awards in bankruptcy, please feel free to call me at 704.749.7747.

Bankruptcy and tax refunds go hand in hand. Each year, individuals find themselves in the unique position of being able to catch up on bills with a tax refund. While this is an admirable way to spend your tax refund, you might consider using the tax refund to file a bankruptcy and eliminate those debts entirely.

Spending Your Tax Refund On Bankruptcy

Spending your tax refund on bankruptcy is a legitimate expense in the eyes of the bankruptcy court. From a filing perspective, if you have additional tax refund money remaining after paying for your bankruptcy, your bankruptcy attorney can typically protect those funds by using the bankruptcy exemptions allowed by law. These include income recently earned, as well as an additional allowance of $5,000 per individual filing.

With this strategy in place, rather than getting caught up on bills temporarily, you work toward a discharge in bankruptcy eliminating the debt from your life entirely. The remaining funds in your account can be used to get off on the right foot after filing.

Filing Prior To Receiving A Refund

The bankruptcy court will ask about an anticipated tax refund and you have to disclose it even if you have not received it. Again, the bankruptcy exemptions can be used to protect the future refund so that your Chapter 7 or Chapter 13 bankruptcy can proceed and you can maintain control over your tax refund.

What If My Refund Is Too Large To Protect

If your tax refund is too large to protect with the bankruptcy exemptions, you can choose to use the refund to pay your normal living expenses for the coming months. Once the money in your account reaches an amount you can protect, you can successfully file bankruptcy at that time.

What Shouldn’t I Do With My Refund

If you plan to file bankruptcy in the near future, you should not spend your tax refund on ‘luxury’ items like a new television or jewelry. Those items will need to be disclosed to the bankruptcy court and because they are new, their value will be high and therefore difficult to protect with exemptions.

An exception to this would be using a tax refund to obtain a new vehicle with financing. Typically, the loan balance on the vehicle will make it an unattractive asset to the bankruptcy court, especially when combined with the available vehicle exemption of $3,500 which protects equity in your car—new or old.

If you would like to speak with a bankruptcy attorney, call me at 704.749.7747. The call is free and the choices you make today can put you in a better position for a successful filing in the future. Or, if you’d like to receive a call, just text “Please call” to 704.258.5897 and we will reach out shortly. It’s that easy.

Federal bankruptcy laws determine whether filing bankruptcy in Charlotte is appropriate. More specifically, this is the U.S. Bankruptcy Court for the Western District of North Carolina, Charlotte office .

180 Days Test

Generally, a bankruptcy case (except a case under chapter 15) may be filed in any federal district court containing the debtor’s “domicile, residence, principal place of business . . . or principal assets in the United States . . . for the one hundred and eighty days immediately preceding” the filing of the case. The debtor may also file for bankruptcy in the district in which a case is pending concerning any affiliate, general partner or partnership of the debtor.

If you work in the geographic area the Charlotte office serves, or own property in that same area, you can also file in Charlotte.

Do I Need An Attorney To File?

An attorney is not required, in order to file bankruptcy. That being said, there are numerous pitfalls to filing bankruptcy which an experienced and knowledgeable bankruptcy attorney can assist with, if you are filing bankruptcy in Charlotte. These relate to claiming exemptions on property you own, to backing out non-filing spousal income not contributed to the household.

You will also need to complete a bankruptcy petition to submit to the court. The petition can be admittedly confusing. Quite often, individuals begin with the intention of filing themselves and then ultimately turn the file over to an attorney when the going gets rough. There’s nothing wrong with giving it a look on your own, though, to see if you’re up to the task. You can find forms at the U.S. Bankruptcy court website HERE.

How Long Does It Take?

It typically takes about 100 days from the day you file, to receive a discharge in bankruptcy.

Most of the time and energy involved in filing bankruptcy in Charlotte relates to gathering information and preparing the bankruptcy petition. Generally, you’ll need to gather information on the last six months of income, the value of your assets, and your expenses. The bankruptcy attorney will organize this information and disclose it according to the federal rules of bankruptcy.

Once the petition is filed, all creditor attempts to collect on debt are halted as a result of the Automatic Stay in bankruptcy. A few days after filing, your creditors will receive notice of the bankruptcy and you will receive a date for your brief 341 meeting of creditors. This is a short meeting held in the presence of your attorney and the bankruptcy trustee.

The trustee may request a few documents after the meeting—bank statements, perhaps a request to have your vehicle appraised at Carmax. Generally speaking, these requests are not complicated and your bankruptcy attorney can prepare you ahead of time for having information ready to provide to the trustee.

After the 341 Meeting, there is a period of about thirty to forty-five days where the trustee will review the file. The trustee will then enter a report of no distribution, which is a successful outcome. On the heels of this, the bankruptcy court will issue a discharge. There is nothing for you to do, and the case is closed.

Fees For Filing Bankruptcy In Charlotte

For a Chapter 7 bankruptcy filing, every attorney’s fees are different. The bankruptcy fee must be paid in full any time prior to the filing of the petition. Typically, the attorney and client work together to prepare the bankruptcy petition while the client works to gather the fee prior to filing. When the attorney is ready with the petition and the client is ready with the fee, you’re ready to file.

If you have any questions about debt, collections calls, or bankruptcy, please call 704.749.7747 to speak with an attorney today. There is no obligation to file and the call is free—helping people understand their options is part of the job.

There are numerous reasons why married couples filing bankruptcy need to consider their options. A Charlotte bankruptcy lawyer can assist you with clarifying your objectives, and then analyzing the choices for filing. Here is a very brief overview:

Avoid Bankruptcy Altogether

I speak with individuals every day who are facing issues with one creditor, or who do not have enough debt to make it worthwhile to file bankruptcy. In those instances, I provide guidance around negotiating with the existing creditors. I can assist in this process if necessary but I’ve found most individuals can do it on their own and save the attorney fee to put toward the debt.

Joint Filing

If most debt is held jointly, it will make sense to have both spouses file. While there is a concern to save the credit of one spouse, by the time most married couples filing bankruptcy speak with a bankruptcy attorney, their credit has already been hampered by late payments or a failure to pay.

Debt in the names of both spouses essentially means each spouse is 100% responsible for that debt. If one spouse files bankruptcy, that spouse is relieved of their obligation but the non-filing spouse is still on the hook for 100% of the debt. This is the primary reason to file jointly when there is substantial credit card, medical, or home debt.

Both Spouses Filing Separately

While these situations are rare, there are instances where both spouses will file bankruptcy, but the bankruptcy attorney will file the petitions separately. Typically, this is a strategy to meet the rules of bankruptcy and present the petitions to the court in a way which allows the spouses to qualify individually where they would not qualify if they filed together—usually an income barrier is overcome this way.

One Filing Spouse, One Non-Filing Spouse

If debt is primarily held in one spouse’s name, there may be good reason to file in that spouse’s name only. This also preserves the credit of the non-filing spouse. If the debt is not theirs, chances are their credit has been preserved along the road to their spouse’s bankruptcy. If there is a goal to purchase a home in the near future, the non-filing spouse’s credit can potentially be used to procure a loan for the home purchase.

Every Case Is Unique

Each client, each situation, is unique. Depending upon which spouse holds the debt or whose name the home is in, your bankruptcy attorney will be able to quickly assist you in sorting through the options and making a decision.

If you’d like to speak with an attorney, call 704.749.7747 today. I’m here to help.

The stereotypes and myths around bankruptcy often serve as a barrier for deserving people who need to file. The fact is that whether you’re a school teacher, hospital employee, doctor, or lawyer, economic difficulties which can’t be offset by income lend themselves to considering filing bankruptcy. Increasingly, like all U.S. workers, we see that professionals are not immune to bankruptcy.

In this article published by the New York Times, there’s a clear indicator that all the preparation in the world—including a graduate school degree—don’t always keep us out of financial harm’s way. What’s inspiring and comforting is that the rules of bankruptcy offer everyone a powerful solution when all other options have been exhausted.

One of my concerns as a bankruptcy attorney is that qualified individuals refrain from filing due to embarrassment or the mis-guided belief their personal property will be taken by the bankruptcy court: this is a rare occurrence. A brief conversation with a bankruptcy lawyer can help determine whether these fears are based in reality.

The greatest reward of my practice is helping people in need restore financial and emotional stability back to their lives. It’s a long life and a fresh start changes everything—that goes for every client, regardless of their profession or job.

Call Today

If you have questions about bankruptcy and would like to speak with an attorney today, call 704.749.7747 and I’d be happy to speak with you. Or, send a text to the number on the right side of the screen and you will receive a call. It’s that easy to get answers.

An automatic stay violation in bankruptcy often gives rise to a cause of action for the debtor. When you file bankruptcy, the automatic stay affords you protection from creditor attempts to collect on debts until the automatic stay ends. This includes phone calls, mailings or any other communication requesting payment. In some limited cases, an attempt to collect or move forward with a proceeding is not an automatic stay violation. Examples include child custody, criminal lawsuits and eviction cases.

The automatic stay applies to pre-bankruptcy debt. Any debt incurred after the filing of the bankruptcy is not protected by the automatic stay and so attempts to collect on post-bankruptcy debt is not an automatic stay violation. The date of the bankruptcy filing is the date the automatic stay begins.

What Rights Do I Have?

If there has been an automatic stay violation, your attorney should send a written letter to the creditor informing them they are engaging in an automatic stay violation, request the demand for payment be withdrawn within ten days of receipt of the letter, and inform the creditor a motion for sanctions will be filed if not.

An automatic stay violation is evidence of a creditor’s poor communication system regarding bankruptcy filing and collection practices and increases legal fees and time and expense for all parties. If evidence is presented the court to satisfy the court that there has been an automatic stay violation that continues after the attorney letter, clients and their attorney are most often awarded damages.

If you have a question and would like a free phone consultation regarding an automatic stay violation or any other bankruptcy related question, please call me at 704.749.7747. I’m here to help.

While student loans are generally not dischargeable in bankruptcy, the filing of a Chapter 13 bankruptcy can assist greatly in managing payments on student loans. For this reason, if you have a legitimate need for filing a Chapter 13 bankruptcy, consider that while student loans in bankruptcy are not dischargeable, they will be affected.

Active Plan Collection Attempts

So long as your Chapter 13 plan payments are current, the automatic stay prevents creditors—including those for student loans—from attempts at collecting. You will not receive bills for student loans, phone calls, or threats for wage garnishment or bank account levy.

Student Loans In Bankruptcy

While student loans are not discharged in bankruptcy, a Chapter 13 bankruptcy can assist in managing student loan payments. Your student loan payments will be included in your Chapter 13 payment, and they will be adjusted according to your disposable income when you file. Typically, this means that the student loan payments are lowered for the duration of the Chapter 13 plan.

In Summary

In summary, student loans survive bankruptcy, but a Chapter 13 bankruptcy puts an end to collections attempts and typically lowers your effective student loan payment through the plan, so long as the plan is active. For most clients, these are meaningful changes in addition to the other relief provided by filing bankruptcy.

If you have any questions or would like to speak to an attorney about bankruptcy in general, please call me at 704.749.7747. The call is free and I’m happy to help.

Whether you qualify for a Chapter 7 bankruptcy is a function of median income as well as the Means Test.

Let’s start by looking at median income. This is a standard used to determine if you automatically qualify for Chapter 7 bankruptcy. If your median income for your household size is less than the median income, you qualify.

As of November 26th, 2013, below you’ll find the median income for the past six months, based on household size, for Mecklenburg County zip codes:

Household Size                 Median Monthly Income              Median Annualized Income

1                                              $3,395                                                   $40,736

2                                              $4,305                                                   $51,662

3                                              $4,587                                                   $55,049

4                                              $5,512                                                   $66,147

5                                              $6,187                                                   $74,247

6                                              $6,862                                                   $82,347


What If My Income Is More Than The Median Income?

If you make less than the median income above, based on your household size, you automatically qualify for a Chapter 7 bankruptcy from an income perspective. If your income is more than the totals above, you probably still qualify for Chapter 7 if you’re having difficulty paying your monthly expenses.

The Means Test is the method you would employ to establish your ability to file. It is a function of your income and expenses and your Charlotte Bankruptcy Lawyer can help you provide the information necessary to determine whether you’ll pass the Means Test.

What Other Options Are There?

If you make more than the median income, and you don’t pass the Means Test, you can consider filing a Chapter 13 bankruptcy. While a Chapter 7 filing is a liquidation of debt, a Chapter 13 results in a monthly payment in bankruptcy. Typically, a Chapter 13 payment will be based on a percentage of your unsecured debt—credit cards, medical bills, etc—and after the plan is completed, you will be discharged of the remaining debt.

What Should I Do Next?

The next thing you should do is CALL AN ATTORNEY. Whether it’s this law firm or another Charlotte Bankruptcy Lawyer, you can prevent the loss of your property to creditors and the effect of judgments by speaking to an attorney and finding out your options. The call is free—704.749.7747.

Most small business owners have to take a risk to get started. You need equipment or money before you can make money. When the income is outweighed by the debt, you may find yourself facing a small business bankruptcy.

Despite what you’ve read about filing business bankruptcy, you can quite often accomplish the same result through a personal bankruptcy by filing a Chapter 7 or Chapter 13 bankruptcy, and dissolving the small business—usually a Limited Liability Company or S-Corp.

Personal Liability In Small Business Bankruptcy

When most small business owners take on business debt, they sign as an officer or member of the small business, and then again personally. This guarantees the lender that either the business or the individual will repay the debt. This is why simply dissolving the business will not eliminate the debt from your life—you’re still on the hook personally. This means creditors for the business can come after your personal assets: home, vehicles, savings, etc.

Business Assets and Liabilities

When you file a personal bankruptcy and include business debt, you’ll also need to provide income and loss statements for the business for the year prior to filing. Your Charlotte bankruptcy attorney can assist you with putting these together, if an accountant has not already done so. You’ll also need to list all assets and debts of the business.

Dissolving The Company

Dissolving an LLC or other small business entity eliminates the potential for creditors to pursue the company for debt—the company no longer exists. If you file a personal bankruptcy in combination with the dissolution, you relieve your personal liability. In essence, you’ve filed a small business bankruptcy by filing personally.

Starting Another Business

Filing a small business bankruptcy does not prevent you from starting a new business. You’ll be subject to the same approval process if you need to take on debt to get the business started, and your personal bankruptcy may be a hurdle from a credit perspective. But entrepreneurs are creative and often find funding outside of traditional means to get new businesses started.

Call today if you have questions about your small business, small business bankruptcy or personal bankruptcy. The call is free, and I’m here to help. 704.479.7747. Or, email me at Charlotte Bankruptcy Lawyer and I’ll reply shortly.

Filing bankruptcy more than once is not anyone’s goal, but if you meet certain requirements you can successfully file a second bankruptcy. This article outlines some requirements for multiple bankruptcy filings.

Timing Limits

Know that when time limits are discussed in this article, unless otherwise specified, they are referring to the discharge date of the prior bankruptcy.

Multiple Bankruptcy Filings If A Discharge Was Received

Same Chapter Filings

Chapter 7—If you previously received a discharge in a Chapter 7 and are interested in filing another Chapter 7, you must wait eight years from the filing date of the first bankruptcy, before filing a second time.

Chapter 13—If you previously received a discharge in Chapter 13, you cannot receive a discharge in the second Chapter 13 case that is filed within two years from the filing date of the original Chapter 13. As most Chapter 13 cases are 36 months or longer, this is not typically an issue.

Different Chapter Filings

Chapter 13 THEN Chapter 7—Debtors who receive a discharge in a Chapter 13 cannot receive a discharge in a Chapter 7 if that Chapter 7 case is filed within six years of the date of the filing of the Chapter 13. There are exceptions to this rule, relating to whether all unsecured creditors were paid in full in the Chapter 13. Your bankruptcy attorney can examine this for you if it is a concern.

Chapter 7 THEN Chapter 13—Debtors who file a Chapter 13 after receiving a discharge in a Chapter 7 will not receive a discharge in the Chapter 13 if the Chapter 13 is filed within four years of the date the Chapter 7 was filed.

No Discharge Received

If you did not receive a discharge in your first bankruptcy filing, with very few exceptions, you can successfully complete multiple bankruptcy filings, receiving a discharge in the second filing. One exception is where your original case was dismissed by the court for failure to appear in court, or you voluntarily dismissed your case for some reason.

If you have questions about multiple bankruptcy filings, please feel free to call. I’m happy to answer those questions—it’s part of my job. I can be reached at 704-749-7747.