John Goetz Law, PLC

‘Bankruptcy Foreclosure’ Or ‘Mortgage Rescue’ Scams

Mon, 07 Jul 2025 14:06:43 GMT

Don't get “locked out” of your home by a bankruptcy scam operator

Are you having trouble making your home mortgage payments? Are you facing foreclosure on your home? Get all the facts before you pay someone to help you work out your mortgage problems.

“Bankruptcy foreclosure scams” or “mortgage rescue scams” target people whose home mortgages are in trouble. Scam operators advertise over the Internet and in local publications, distribute flyers, or contact people whose homes are listed in the foreclosure notices. Sometimes they direct their appeals to specific religious or ethnic groups.

These scam operators may promise to take care of your problems with your mortgage lender or to obtain refinancing for you. Sometimes they also ask you to pay your mortgage payments directly to the scam operator. They may even ask you to hand over your property deed to the operator, and then make payments to the operator in order to stay in your home.

But instead of contacting your lender or refinancing your loan, the scam operator pockets all the money you paid, and then files a bankruptcy case in your name — sometimes without your knowledge.

A bankruptcy filing often stops a home foreclosure, but only temporarily. If a bankruptcy is filed in your name but you don't participate in the case, the judge will dismiss the case and the foreclosure proceedings will continue.

If this happens, you will lose the money you paid to the scam operator — AND YOU COULD LOSE YOUR HOME.

You will also have a bankruptcy listed on your credit record for years afterward.

Proceed with care if an individual or company:

Calls itself a “mortgage consultant,” “foreclosure service,” “mortgage rescue service,” or similar name.
Contacts or advertises to people whose homes are listed for foreclosure.
Collects a fee before it provides services to you.
Tells you to make your home mortgage payments directly to the individual or company.
Tells you to transfer your property deed or title to the individual or company.

If you think an individual or company is running a mortgage foreclosure scam, contact the local office of the United States Trustee. The United States Trustee is a Justice Department official who monitors the bankruptcy system. Look for your local United States Trustee's telephone number on our Web site's Nationwide Office Locator .

Press Contact:

Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411

Updated July 9, 2024

Personal Finance Late student loan bills can drop credit scores by up to 171 points, Federal Reserve warns

Mon, 07 Apr 2025 15:19:28 GMT

(Article from CNBC - Dateline: March 28, 2025 at 2:04 PM EDT)

The more than 9 million student loan borrowers who are estimated to be late on their payments could experience “significant drops” in their credit scores during the first half of 2025, the Federal Reserve Bank of New York warns.

Some people with a student loan delinquency could see their scores fall by as much as 171 points , the Fed writes in a March 26 report . Credit scores, which impact people’s ability and costs to borrow, typically range from 300 to 850, with around 670 and higher considered good.

The expected drop was highest for borrowers who start with the best scores. Among those with scores under 620, the reported new delinquency could lead to an average 87-point decline.

“Although some of these borrowers may be able to cure their delinquencies,” the Fed writes, “the damage to their credit standing will have already been done and will remain on their credit reports for seven years.”

It’s been a long time since federal student loan borrowers have needed to worry about the consequences of missed payments , which can also include the garnishment of wages and retirement benefits . That’s because collection activity was suspended during the pandemic and for a while after. That relief period officially expired on Sept. 30, 2024 .

As student loan delinquencies appear on credit reports again this year, borrowers are likely to face a cascade of financial consequences , said Doug Boneparth, a certified financial planner and the founder and president of Bone Fide Wealth in New York.

“This credit score penalty restricts their access to affordable financing, locking them into a cycle of elevated borrowing costs and fewer opportunities to rebuild their financial stability,” said Boneparth, who is a member of CNBC’s Advisor Council .

Student loan borrowers can protect their credit

Student loan borrowers struggling to make their payments have options to stay on track and protect their credit, consumer advocates say.

For one, finding an affordable repayment plan can lower your chances of falling behind on your bills. Borrowers can apply for an income-driven repayment plan , which will cap their monthly bill at a share of their discretionary income. Many borrowers end up with a monthly payment of zero.

The Education Department recently re-opened several IDR plan applications , following a period during which the plans were unavailable.

Borrowers can also apply for a number of deferments or forbearances , which can pause your payments for a year or more. It may show up on your credit report that you’re not currently making payments on your loan, but you shouldn’t be flagged as late, said higher education expert Mark Kantrowitz.

NOTE: You can use bankruptcy to pay or possibility eliminate student loan debt. If you are interested in learning more, contact John Goetz Law, PLC by calling 540-359-6605 or emailing to info@johngoetzlaw.com.

Taxpayers can request a copy of previous tax returns

Mon, 31 Mar 2025 13:41:18 GMT

(from the IRS Website - IRS Tax Tip 2025-21, March 27, 2025)

Taxpayers can access their personal tax records in several ways. Those records are useful and can help with future tax filing. People should generally keep copies of their federal tax returns and any related documents for at least three years after they file.

If a taxpayer wants a copy of their previous tax returns or a transcript of their tax account, they can ask their tax software provider or tax preparer, or they can request their records directly from the IRS.

Get tax records from IRS Online Account

The fastest and easiest way for taxpayers to view their tax records is by logging on to their IRS Online Account . There, they can:

View, print or download their tax transcripts.
Find out how much they owe.
Look at their payment history.
See their prior year adjusted gross income (AGI).
View other tax records.

If taxpayers don’t have an IRS Online Account and can’t create one, they still have a few options to get the information they need.

Ask the software provider or tax preparer

Individuals that used a software provider or tax preparer to file should contact them for a copy of their tax return.

Request a transcript from the IRS

If a taxpayer can't get a copy of a prior year federal tax return, they can order a tax transcript from the IRS. The tax transcript shows their basic filing information as well as any changes made after the taxpayer filed. These are free and available for the for up to three years after the IRS has processed the tax return.

People can get their tax transcripts by mail or by phone.

By mail: Taxpayers can complete and send either Form 4506-T or Form 4506-T-EZ to the IRS to get one by mail. They use Form 4506-T to request other tax records: tax account transcript, record of account, wage and income and verification of non-filing.
By phone: Taxpayers can call 800-908-9946 to request a transcript by phone. Transcripts requested by phone are mailed directly to the taxpayer.

To protect taxpayers' identities, tax transcripts partially hide personally identifiable information such as names, addresses and Social Security numbers. All financial entries, including the filer's adjusted gross income, are visible.

Request a copy of a tax return

Prior year tax returns are available from the IRS for a fee. Taxpayers can request a copy of a tax return by completing and mailing Form 4506, Request for Copy of Tax Return , to the IRS address listed on the form. There's a $43 fee for each copy. These are available for the current tax year and up to seven years prior.

Bad Faith Can Be Your Downfall - Bankruptcies Must Be Filed In Good Faith

Wed, 26 Mar 2025 18:23:26 GMT

Determine if your case would be in danger if you filed your case for the wrong reasons

When filing for bankruptcy, it is important that you do it for the right reasons. There are times when your case can be dismissed because you didn't file a case in "good faith". Some factors considered by bankruptcy courts to determine if a petition is filed in good faith include, but are not exclusive to, eleven factors that include:

(1) The debtor's concealment or misrepresentation of assets and/or sources of income, such as the improper or unexplained transfers of assets prior to filing;

(2) The debtor's lack of candor and completeness in his statements and schedules, such as the inflation of his expenses to disguise his financial well-being;

(3) The debtor has sufficient resources to repay his debts, and leads a lavish lifestyle, continuing to have excessive and continued expenditures;

(4) The debtor's motivation in filing is to avoid a large single debt incurred through conduct akin to fraud, misconduct, or gross negligence, such as a judgment in pending litigation, or a collection action;

(5) The debtor's petition is part of a "deliberate and persistent pattern" of evading a single creditor;

(6) The debtor is "overutilizing the protection of the Code" to the detriment to his creditors;

(7) The debtor reduced his creditors to a single creditor prior to filing the petition;

(8) The debtor's lack of attempt to repay creditors;

(9) The debtor's payment of debts to insider creditors;

(10) The debtor's "procedural gymnastics" that have the effect of frustrating creditors;

(11) The unfairness of the debtor's use of the bankruptcy process.

New Government Standards for Student Loan Forgiveness in Bankruptcy

Mon, 21 Nov 2022 13:25:39 GMT

In the past, it was very difficult to have student loans forgiven in bankruptcy. The standard was a test that made it next to impossible to get student loans forgiven. This past week, the Department of Justice announced they are going to ease the standards to allow for student loan forgiveness. The following is an announcement from the Department of Justice. If you believe you may qualify for student loan forgiveness in bankruptcy, fell free to schedule a free consultation with John Goetz Law, PLC by calling 540-495-1354

At a Glance: Department of Justice's New Process for Student Loan Bankruptcy Discharge Cases

Each year, individuals in the bankruptcy process seek to discharge student loan debt in order to get the "fresh start" envisioned by the bankruptcy code. Congress has set a higher bar for discharging student loan debt compared to other debt—debtors who seek to discharge student loans must prove in a separate "adversary proceeding" that paying their student loans would impose an "undue hardship." But that higher bar need not be an insurmountable barrier for debtors who cannot afford to pay their student loans.

The Department of Justice, in close coordination with the Department of Education, is implementing a new process at the outset of adversary proceedings in which debtors seek to discharge federal student loans in bankruptcy. While the bankruptcy judge makes the final decision whether to grant a discharge, the Justice Department can play an important role in that decision by supporting discharge in appropriate cases. The new process will help ensure transparent and consistent expectations for the discharge of student loan debt in bankruptcy; reduce the burden on debtors of pursuing such proceedings; and make it easier for Justice Department attorneys to identify cases where discharge is appropriate.

Under the Justice Department's new process, debtors will complete an attestation form to assist the government in assessing the discharge request. The Justice Department, in consultation with the Department of Education, will review the information provided, apply the factors that courts consider relevant to the undue-hardship inquiry, and determine whether to recommend discharge. Even where the applicable factors may not support a complete discharge, where appropriate, the Justice Department will consider supporting a partial discharge.

Justice Department attorneys will assess the undue-hardship factors in the following manner:

Present Ability to Pay - Using existing standards developed by the IRS and the information provided by the debtor, the Justice Department attorney will calculate a debtor's expenses and compare those expenses to the debtor's income. If a debtor's expenses equal or exceed the debtor's income, the Department will determine that the debtor lacks a present ability to pay.

Future Ability to Pay - The Department will then assess whether the debtor's present inability to pay is likely to persist in the future. The Department attorney will presume a debtor's financial circumstances are not likely to change if certain factors—such as retirement age, disability or chronic injury, protracted unemployment history, lack of degree, or extended repayment status—are present. Where such factors are not present, the Department attorney will assess the facts showing whether the debtor's present inability to pay is likely to persist.

Good Faith Efforts - In assessing what courts call the "good faith" standard, the Department will focus on objective criteria reflecting the debtor's reasonable efforts to earn income, manage expenses, and repay their loan. The Department attorney will consider, for example, whether the debtor contacted the Department of Education or their loan servicer regarding payment options for their loan. A debtor will not be disqualified based on past non-payment if other evidence of good faith exists. A debtor also will not be disqualified based on their not enrolling in an income driven repayment plan where the debtor was deterred from participating in such a plan or otherwise provides a reasonable explanation for non- enrollment.

The Need to Save Your Home

Fri, 28 Oct 2022 18:47:10 GMT

With mortgage rates on the rise, home sales are falling (and for good reason). Mortgage rates are at a 2+ year high. With rates exceeding 7%, it is more expensive to buy a home now than what it was a year ago. The last time mortgage rates were over 7% was in 2002. Last year interest rates were around 3.25%. With home sales decreasing, the amount of available inventory should increase. This also means that the value of a home may decease. For current homeowners, this creates a need to preserve their home ownership. It is important, when possible, to avoid foreclosure or the need to sell a home.

Inflation is at a 30 year high. This means that almost everything associated with home ownership (utilities, furniture, food, etc.) are more expensive. Because of rising costs, people need to chose what to spend their money on. A recent report said that some people have to chose between eating meals and paying utilities. This is sad and it is real. For some, there may also be the choice of paying the mortgage or buying food, keeping the heat on, and buying gas to commute to work.

For those who are facing these tough home ownership issues, there be some help. If you are also drowning in debt, and have to chose between paying credit cards or buying food or paying a mortgage, bankruptcy may be an option to alleviate financial hardship issues. Even if you have equity in a home, bankruptcy may be an option to cut costs. If you are behind on your mortgage because of overwhelming debts, bankruptcy may be an option to cut costs and make your home affordable again.

If you, or someone you know, is risking home loss, a free consultation with a bankruptcy attorney may be a way to determine what options are available to make it easier to live financially. Contact John Goetz Law, at 540-359-6605, to schedule your appointment today.

Types of Bankruptcies

Thu, 13 Oct 2022 14:02:11 GMT

Bankruptcy is a tough choice to make. Yet when you are in a very tight financial position and it doesn't look like it is going to get any better, bankruptcy might be the only way out. However, there are many different types of bankruptcy, and not every type will fit your own set of circumstances. A bankruptcy lawyer is your best bet to determining which types of bankruptcy will work for you.

Chapter 7 Bankruptcy

A Chapter 7 bankruptcy is a sort of win-win situation. You are required to liquidate whatever assets you have and pay your creditors what you can. Whatever debt is left your creditors agree to dismiss and the courts discharge the remainder. If you own no assets that can be liquidated, all of your qualifying debts are discharged. Some individuals like this type of bankruptcy because they can feel like they made a really valiant effort to still pay off some of their debts while the rest of their crushing debt load is erased.

Chapter 9 Bankruptcy

A Chapter 9 bankruptcy doesn't apply to individuals. It only applies to municipalities who are unable to pay their collective bargaining debts or their contractors. Cities who don't want to raise taxes on their citizens but who lack the funds to pay city-related debts may resort to a Chapter 9. In many states, these cities can only file a Chapter 9 IF they have permission from the state government.

Chapter 11 Bankruptcy

Chapter 11 bankruptcy is usually just for businesses only. However, if you invested in your business and rolled a lot of personal funds into it, you can use the Chapter 11 in conjunction with either a Chapter 7 or Chapter 13. Business owners who don't want to give up their business entirely file a Chapter 11 so they can continue "business as usual" while the debts from the business are settled through the courts.

Chapter 12 Bankruptcy

This type of bankruptcy only applies to you if you make your living from farming or commercial fishing. It has much higher debt ceilings and allows many farmers and fishermen temporary relief in situations where their crops, animals, or daily catches cannot pay their bills. If you fall into one of these two specialty categories because of your career choice, then you can file a Chapter 12.

Chapter 13 Bankruptcy

Even though it's a bankruptcy, you are actually formulating a plan to repay most of your debts through the Chapter 13. It's an attempt to remain in good standing with your creditors by being willing to pay whatever you can at a decreased amount or decreased interest. In many cases, your monthly payments are drastically reduced, and your interest is null until you can get back on your feet again.

Chapter 15 Bankruptcy

A Chapter 15 is only for cases where overseas businesses need financial relief. Your company has to have a foothold here in the United States as well as in another country. If your company is having a huge financial crisis on a global and international scale, you can file a Chapter 15. However, you should be made aware that this raises your bankruptcy to that of the federal courts and it is at the federal courts' discretion to choose to provide your company with relief in regard to your property outside of the U.S..

Pros and Cons of Filing for Bankruptcy

Some types of bankruptcy allow you to restructure your debt while still paying it off. The pro to this is that you maintain a level of personal responsibility that reflects positively on your credit report. The con is that you still have debts to pay every month and you need to pay them because you can't file for bankruptcy again for another 7 years.

Other types of bankruptcy allow you to discharge most, if not all, of your debts. The pro here is that you don't have to worry about these debts or bills ever again. The con is that it hits your credit report hard, and creditors are not likely to extend any amount of credit to you for anything for at least three or more years.

Having to make a choice about filing for bankruptcy should be thoroughly thought out and discussed with anyone and everyone involved. If you are married, your spouse's credit can also be negatively impacted by your bankruptcy, even if you are not including any of your spouse's debts in the process. It is often better to find a way to consolidate your debts rather than file for bankruptcy, but if you can't get a loan to consolidate, then bankruptcy is an option.

Hire the Right Lawyer

Don't let the stigmas surrounding bankruptcy prevent you from filing. Sometimes bankruptcy is just the necessary and right way out. Hire the right lawyer from John Goetz Law PLC and get started today.

5 Reasons Why College Students Should Have an Estate Plan

john@johngoetzlaw.com (John Goetz) — Fri, 07 Oct 2022 14:11:56 GMT

College students are graduating and entering the workforce in droves. If you are one of those students, you should know a few key facts about your future. For example, did you know that someone who graduates with a degree in engineering with $150,000 has more money than someone who earns $150k as an entry-level MBA? As it turns out, there are many reasons why having an estate plan before you graduate from college is essential to ensure success on your journey.

You Don't Know How Much You'll Need

According to the U.S. Census Bureau, the median value of all American homes is $234,500 - and only 1% of Americans own a home worth more than $1 million. And that average value is an estimate - it can vary wildly depending on where you live. This means that you could leave your inheritance in a relative's house at home, which might not be enough money to sufficiently support your family throughout their lives (assuming they have kids). On the other hand, college students may need more than their inheritance, and you don't know.

Your Estate Plan Is Non-transferable

There are several states where the only way to pass the property on after death is through inheritance; however, there are also states where individuals can transfer their property to a trust during their lifetime.

In general, if you would like to pass your property on to your heirs, you must ensure that the property cannot be transferred away from the beneficiaries without your consent. If you are married, you may have separate trusts for each spouse.

Suppose you are not married when you die. In that case, your property can still be transferred to a trust during your lifetime, which means that if your estate is small enough, it will not qualify for the estate tax (the federal tax law that applies to estates valued at over $5.43 million for couples, or $10.98 million for a single person).

You Don't Know How to Manage It

The sad truth is that most students don't have the means or maturity necessary to manage their finances - at least not at the same skill levels, they'll need when starting a new job. That's why it's so important to have an estate plan before you graduate: you will have time (and more experience) to work on your financial management. College is not a good time to start managing your money - you should already know how to do it to focus on your education.

You Won't Have the Support to Save

It's nice when we're in college and wants to spend our money - but it's not always best for us in the long run. If you don't have any money saved, it will be difficult to build up anything that'll leave a meaningful inheritance for your family. So, college student, if you're already dreaming of big birthday parties when you graduate (or even your retirement party), it's time to start saving for that now. An estate plan can motivate you to do so and help you avoid the embarrassment of not having enough money in your bank account at the end of your course.

An Untimely Death Could Spell Doom

You can only go to them for so long before you have to take care of yourself. And no, living off their credit cards or their house isn't necessarily the best idea. An estate plan is yet another reason you should consider taking care of yourself - you shouldn't expect your parents to support you forever. It's time to start preparing for your future without them.

Life is short. And contrary to what you may think, life insurance can be a great investment for your future. Don't let your family be left with anything after you're gone due to an early death. You also have to think about the other end of the spectrum: you could live longer than expected and have no plan in place once that time comes. Furthermore, life insurance can help your family avoid selling the home you left, which would be a monumental burden on them in the short term.

The Bottom Line

It would be best if you started creating a plan before you entered the workforce. The sooner you start thinking about your future, the better you'll be at planning for it. And even if you don't think that estate planning is important to you now, it could be very important in the future - especially when you're moving up in your career and earning more money. Likewise, your parents should have an estate plan in place well before they retire so they can enjoy their retirement years. So please take action now, so you won't regret it later. Our estate planning experts at John Goetz Law PLC can get you started with a consultation today.

Your Estate Will Be Well Distributed Via a Probate Process

john@johngoetzlaw.com (John Goetz) — Tue, 04 Oct 2022 13:54:51 GMT

Probate is a legal process that involves the distribution of a deceased person's property to their heirs, beneficiaries, and devisees. If you plan on leaving an estate for your family, friends, or even charitable organizations after your death, you may need to think about what will happen if you pass away without a will.

Why Probate?

While probate can be a daunting legal process, the death of your spouse can bring life-changing tax consequences for you and your surviving family members. The IRS generally does not allow people to avoid probate by creating a living trust for their assets to pass directly to them. The IRS generally imposes potentially long-term estate tax penalties on people who create living trusts to avoid probate after death. Further, the IRS can penalize your estate if a trustee of the living trust fails to file probate to distribute property under the legal formalities in your state.

3 Ways That an Estate Goes Into Probate

1. If a person dies without a will or trust, and they have only assets that are subject to probates, such as real estate or bank accounts, then an executor is appointed by these assets' title holder (for example, a bank or an attorney who holds the title of your home). The executor will then file a notice of probate with the proper governmental body.

2. If a person dies without a will or trust and they have assets that are not subject to probate, such as personal items or family heirlooms, then any assets that the decedent owned in their right pass directly to their heirs. However, the estate will owe inheritance tax on these assets.

3. If a person dies without a will or trust and their estate has assets that are not subject to probate, then the executor will have to start probating the estate. The executor may have to sell assets from the estate, distribute property through heirlooms and other family members, and sell property from the deceased's estate (such as jewelry) or their living trust. The executor may also have to pay penalties from the estate's assets to the IRS if:

• The executor does not file probate (i.e., if the probate is not started within nine months of death)

• The executor does not file timely tax returns on behalf of the decedent (including income tax returns, gift tax returns, and estate tax returns)

How It Works

After the estate goes into probate, a bank can release any money in the decedent's bank accounts to the account's beneficiary, even if the beneficiary has not been identified.

The estate may also receive property under the joint tenancy with the right of survivorship so that the surviving party gets control of the property. However, this will create a new tax by transferring property between two parties who are still living. Therefore, the IRS generally requires that joint tenancy assets be reported on both parties' income tax returns as they are distributed between them.

After your death, the executor can sign either petition the court to have your spouse appointed as executor or maintain the power to have your spouse act as executor.

Probating an estate can be costly and time-consuming, so it is important to understand what will happen with your estate if you do not have a will or trust. It is also more likely that a probate court will order that your estate goes into probate if you own property alone and no one knows of legal ways in which they can receive the property.

Generally, a will is the best way to avoid probate. However, a will can only accomplish its purpose if the person who has died has clearly designated their beneficiaries and any limitations on those beneficiaries in the will. If there are issues with the designating of beneficiaries or limitations on what that beneficiary can do with the property, then a trust may be necessary for that property.

Some states have laws that allow you to avoid probate by creating a living trust and having your assets pass directly to the trust, known as a testamentary trust. Under those laws, the person who has died can also be the trustee of the living trust rather than a third party. The estate will owe no estate tax if they have no taxable property and only assets exempt from probate. This is in contrast to probate, where any property subject to probate is also taxable for all beneficiaries.

The Bottom Line

The probate process can be lengthy and confusing, so it is important to seek advice from an experienced estate planning attorney if you have any questions about this process. To learn more about how an estate goes into probate or what you should do to avoid probate, contact our experienced estate planning attorneys or visit us to discuss your options.

Retirement - Stock Market

Wed, 31 Aug 2022 15:53:20 GMT

We live in an economic world where even a small change in the market can affect our finances. The recent drop in the financial markets has caused stocks to fall and bond yields to decrease, making it more difficult for investors to get their money back. When most people think about retirement, they don't consider the impact of falling interest rates, especially on bonds that are not held for a long time. If you are considering retiring but debts are in the way, consider bankruptcy to eliminate debts and free up income.

Eliminate Unsecured Debt

Bankruptcy law allows debtors to eliminate unsecured debts through either Chapter 7 or Chapter 13 bankruptcy. Debtors filing for Chapter 7 bankruptcy are allowed to keep their home and other assets with insignificant equity value, but they must surrender any remaining property to creditors. In contrast, debtors who file for Chapter 13 bankruptcy may be able to keep their home and other assets if they can make regular payments over time toward the debts they owe. However, those who file for Chapter 13 must also continue making payments on certain debts while they are working toward restoring their credit rating and getting back on track financially.

Stop Foreclosure on Your Home

If you're struggling with mortgage payments, filing for bankruptcy may be the only way to avoid losing your home. Chapter 13 bankruptcy allows you to keep your home if you can pay off some of your debt over time. Filing for Chapter 13 bankruptcy stops foreclosure proceedings and gives you time to pay off any remaining mortgage debt through monthly payments made through a court-approved repayment plan.

Avoid Lawsuits and Collection Actions

If you are being sued by creditors who want to recover money from you, filing for bankruptcy may stop all collection efforts against you. For example, if someone sues you for not paying back a credit card debt and wins a judgment against you, filing for Chapter 7 bankruptcy will wipe out that judgment so that it no longer has any legal force.

Reduce What You Pay on Secured Debt

If you are behind on a car loan or a mortgage and you want to keep these assets, then filing for Chapter 13 bankruptcy (which involves setting up repayment plans) may be a better option than Chapter 7 (which involves liquidating assets). With Chapter 13, any past due payments, when the bankruptcy petition is filed, will be cure through the bankruptcy payment plan as you continue make the regular payments on an ongoing basis.

Stop Creditor Harassment and Collection Activity

You can stop creditor harassment by filing for bankruptcy protection. Creditors are prohibited from contacting you and must comply with federal law that requires that they stop contacting you (this is call the "automatic stay").

Stop Repossession

An important reason to file bankruptcy is to stops a repossession. Normally, if you can't make your payments, then the lender will come after your car or truck and repossess it. Filing a bankruptcy will stop the ability to repossess; however, if you care unable to make ongoing payments, the lender can get bankruptcy court permission to continue the repossession process. If you can afford to make ongoing payments, bankruptcy can be used as a way to cure the default and get you back on track with payments.

Wipe Out Medical Debt

Medical bills are often the reason people seek relief from debt through bankruptcy. If you have unpaid medical bills, you may be able to discharge them in a chapter 7 case. You must still pay for your current and future care, but the debt from previous treatment is forgiven at the end of your case. You may also be able to discharge credit card debt incurred by paying for medical expenses. Bankruptcy only covers debts incurred up to the filing date of the case.

Filing bankruptcy is not a decision made on a whim. It can affect your credit and other aspects of your life. However, if you are considering it, you need to know the financial advantages of filing bankruptcy. The economic crisis is affecting retirees in every way. Many wonder how they'll make ends meet because jobs aren't as plentiful as they used to be, and pensions are dwindling in value. This can put significant burdens on families. A free consultation with a bankruptcy lawyer may answer a lot of questions and give guidance on how to proceed into retirement.

Inflation - Increased Cost

Mon, 22 Aug 2022 13:39:44 GMT

Inflation is defined as an increase in the price of goods over time. In other words, decreased purchasing power or quality. Over time there has been an increase in cost due to inflation . This has led to an increase in the cost of goods and services.

Factors That Cause Inflation:

1. Rising prices of energy goods and food
2. Rising demand for products due to increased production
3. Money printed by the government without anti-inflation measures in place
4. Credit or debt inflating the economy
5. Government spending or cutting supply (also known as austerity measures)

How Bankruptcy Can Be Used to Free Up Money for the Increase in Cost and Goods

Bankruptcy is a legal course of action taken by individuals, who cannot afford to pay debts due to loss of income, overburdened finances, or even the unexpected. When an individual cannot pay debts under the existing terms for payback, it can lead to the need to file a bankruptcy. Bankruptcy can be helpful to clear up their debts so that people can walk away from their financial situation with a clean or "fresh" start and not have their reputation tarnished.

Bankruptcy helps with inflation because it is a way to free up money by canceling the requirement to pay expensive debt as soon as possible. It is a way to get your financial situation back on track and allow you to live within your means.

Conclusion

In conclusion, when inflation rises, so do the cost of goods and services. This reduces the budget normally reserved from food, clothing, and other necessities of life. To prevent this from happening, we must act fast to prevent the situation from worsening. In recent years, people have turned to bankruptcy, which can give a person a fresh start and free them from a tightening budget by adjusting their financial burden by either paying back what they owe, with a bankruptcy payment plan, or just get some much-needed rest from the burden of owing debt.

The Consequences of Surrendering Real Estate in Bankruptcy

john@johngoetzlaw.com (John Goetz) — Wed, 29 Jun 2022 13:40:10 GMT

Consequences of Surrendering Real Estate

A property is a critical financial asset for the vast majority of us, yet the consequences of surrendering real estate property in a bankruptcy are not well understood. However, we should be worried about these consequences. It is essential to evaluate all potential outcomes before surrendering your property.

Consequences for Your Credit

The most immediate consequence of surrendering a piece of real estate to the bankruptcy court is that it will appear on your credit report as a foreclosure or deed-in-lieu. This negative mark will remain on your record for seven years from the date it occurred and may make it harder for you to obtain credit in the future. This usually isn't a problem if it's a home you no longer own; however, if you've sold the property before filing for bankruptcy, then you'll need to consider other options than surrendering the deed to avoid this negative mark on your credit report.

Consequences for Your Taxes

When you surrender real estate in bankruptcy, it is no longer considered an asset on your bankruptcy filing. This means that you no longer have to pay taxes on the property's fair market value, which is typically higher than what you paid for it. However, there are some exceptions to this rule. For example, suppose you surrender real estate that has been mortgaged or encumbered with a loan, and the lender takes over the property after your bankruptcy filing. In that case, the lender will be responsible for paying any taxes owed on the property's sale. It's also important to note that if you have already paid property taxes on this property before your bankruptcy filing, then these taxes cannot be discharged in your case.

Consequences for Your Bankruptcy Discharge

If you surrender real estate in bankruptcy, your discharge can be affected in two ways: If you receive a free and clear title to your home by means of a deed in lieu of foreclosure, it will not affect your bankruptcy discharge unless the deed was "fraudulent conveyance" under state law or involved actual fraud by the debtor (such as hiding assets).

Suppose there is no deed, and you simply hand over possession of your property back to the lender and stop making payments on it. In that case, it can affect your bankruptcy discharge if there is a prepetition lien against that property that was not released or discharged prior to filing for bankruptcy protection.

Overall, homeowners should consider all the options before handling a foreclosure. The consequences of surrendering real estate in bankruptcy can last a lifetime when done irresponsibly and incorrectly. Bankruptcy can be a powerful tool, but it's not the right solution for everyone.

How to File for Bankruptcy After a Difficult Divorce

john@johngoetzlaw.com (John Goetz) — Wed, 29 Jun 2022 13:32:04 GMT

A divorce brings with it wide-ranging consequences. Some might not be felt immediately after the divorce, but others, such as bankruptcy, might be felt immediately. Divorce affects your expenses, debts, property rights, income, and your relationship with your children. These effects can lead you to bankruptcy. Your divorce decree has all the information you need to file for bankruptcy. A bankruptcy trustee will help review the information to determine what is important in your case and what needs to be left out. Read on to learn more.

Understand Property Division Provisions

Your divorce decree shows all the assets that you and your spouse owned when the marriage was still working. It also shows the order that divides the assets into two. You need to ensure that all your assets from the divorce appear on the Schedule A/B form, as well as the assets acquired after the divorce. If you were not awarded an asset after divorce, be ready with an explanation of the fate of the asset. Spouses who sell or give away assets need to show transfer documents in their Statement of Financial Affairs.

Debt Division Provisions

Your debts will change after the divorce. You need to list out all the debts when filing for bankruptcy. List out any joint debts and any family debts, some of which may not be listed in your name on the declaration. You also need to show how the debts were divided after the divorce. Check whether the divorce decree shows a section for indemnification of debts. Indemnification works when a spouse is forced to pay for a day that was allocated to you after the divorce. If, for instance, you file for bankruptcy, but there is a credit card debt that was awarded to you, the credit card company will follow your spouse. With an indemnification clause, your spouse can sue you and force you to pay the credit card debt.

Debt from the Divorce

A divorce case can leave you in debt. You can get into debt from child support, debt you owe your spouse as part of a property settlement, and attorney fees. Although you still need to list it in your bankruptcy filing, debt from child support is not dischargeable and so is the debt from property settlement. However, attorney fees are dischargeable.

Conclusion - Talk to a Lawyer

You need the best legal representation to understand what documents you need and what will help in your bankruptcy case. With the right lawyer, the process is fast and effective, helping you get back to your normal life within a short time. Talk to an attorney today.

Bankruptcy Affect on Credit

john@johngoetzlaw.com (John Goetz) — Thu, 09 Jun 2022 21:39:29 GMT

Filing a bankruptcy may negatively affect your credit report and rating and could negatively affect the credit report and rating of a co-debtor. A bankruptcy attorney is not responsible for any problems with any credit report as a result of filing a bankruptcy and has no direct control over how debts are reported. Under current law, Credit Reporting Agencies may note a Chapter 7 Bankruptcy on a credit report for up to 10 years or a Chapter 13 Bankruptcy on a credit report for up to 7 years. Beware, however, that even after the 10 or 7 years have expired, banks and other lenders may still ask whether a bankruptcy has ever been filed bankruptcy, at any time, as a part of a loan application. The legal services supplied by a bankruptcy attorney normally do not include efforts to remove negative or false information from credit reports, without payment of an additional fee. Credit Reporting Agencies each publish procedures that may be followed for the removal of negative or false information on credit reports.

Mortgage Forbearance Issues

Thu, 29 Oct 2020 22:04:00 GMT

Some mortgage companies are offering nine to twelve month forbearances because of COVID-19. This is fine, except, if the borrower does nothing after the forbearance period ends, the mortgage company has the right to accelerate the loan and foreclose. Alternative remedies, I have learned, to avoid foreclosure, include loan modifications, FHA insurance claims, tack-on loans (which are loans offered by the mortgage companies that come due after your current mortgage is paid off), and Chapter 13 bankruptcy.

The post Mortgage Forbearance Issues appeared first on John Goetz Law, PLC .

How to Pay for Bankruptcy When You’re Flat Broke

Tue, 16 Jun 2020 14:02:00 GMT

By Cathy Moran, Esq. (Redwood City, CA)

One of the cosmic ironies of our legal system is that it costs money to file bankruptcy. Bankruptcy gets you out of debt only if you have the money to file.

The costs of bankruptcy include the filing fee collected by the court; the required credit counseling; and, if you’re smart, an experienced lawyer to make sure it’s done right.

I have not recommended people represent themselves in bankruptcy since Congress “reformed” bankruptcy 15 years ago. The express intent of that law was to discourage consumers from getting relief from their debts. With “reform”, bankruptcy law acquired pitfalls, traps, and requirements that invited mistakes.

But a malicious Congress left untouched one of the shining features of bankruptcy, the ability to pay your bankruptcy attorney after you file Chapter 13 .

Chapter 13 pays attorneys fees

Chapter 13 is a repayment plan for individuals. You make a monthly payment to a Chapter 13 trustee for the life of the plan. Those plan payments can pay the lawyer who helped you file the plan and get a bankruptcy discharge .

By contrast, to file Chapter 7, the most common alternative to Chapter 13, your attorneys fees usually need to be paid in full, before you file. Paying for Chapter 7 then becomes a challenge unto itself.

In Chapter 13, the debtor’s attorney has an administrative claim in the case for whatever part of the total fee wasn’t paid before the case was filed. Administrative claims have a priority for payment under bankruptcy law.

Choosing Chapter 13

The ability to effectively finance the attorney’s fees to file bankruptcy can be a godsend when you face the need for an immediate bankruptcy filing. That need can be as concrete as the need to save your house or your paycheck. Or it can be as ephemeral as the need to stop the stress of being in debt.

Chapter 13 comes with some features that aren’t as appealing as Chapter 7. The biggest downside is that the discharge doesn’t come until you complete the plan payments, which can run from 36 months to 60 months.

The duration of the plan risks that intervening events, like job loss or health issues may compromise your ability to make the plan payment.

But usually, if your situation was so bleak that you couldn’t pay for a Chapter 7, the Chapter 13 plan payment may be as little as $50 to $100 a month.

And, if it develops that you can’t make the Chapter 13 payments, you have the absolute right to convert your case at any point to Chapter 7.

All in all, that’s why I love Chapter 13 .

The post How to Pay for Bankruptcy When You’re Flat Broke appeared first on John Goetz Law, PLC .