Tag Archives: Bankruptcy

The answer is, it depends. The entire state of Utah is one federal district. The district is divided into four divisions: Northern, North Central, South Central, Southern.

If you reside in the Northern division you will be required to attend a meeting of creditors and confirmation hearing in Ogden. The Northern division consists of the following counties: Box Elder, Cache, Davis (north of Centerville), Morgan, Rich and Weber.

The North Central division consists of Dagget, Davis (Centerville and south), Salt Lake, Summit, and Tooele counties. If you reside in one of these areas, you will attend your meeting of creditors and confirmation hearing (if you filed a chapter 13) in Salt Lake City.

The South Central division includes: Carbon, Duchesne, Emery, Grand, Juab, Millard, San Juan, Sanpete, Sevier, Uintah, Utah, and Wasatch counties. If you reside there and you file a chapter 7 bankruptcy, your meeting of creditors will be held in Provo. But if you file a chapter 13, your meeting of creditors and confirmation hearing will be held in Salt Lake City.

And finally, if you reside in the Southern division, your meeting of creditors and confirmation hearing (if you filed a chapter 13) will be held in St. George. The Southern division includes Beaver, Garfield, Iron, Kane, Piute, Washington, and Wayne counties.

If your case is complex and requires more than the ordinary meeting of creditors and/or confirmation hearings, you may very well have to go to Salt Lake City for those hearings. Your attorney will keep you in the loop about when and where you have to be.

If you have any questions about filing for protection, call us anytime to speak with a Salt Lake City bankruptcy lawyer. The consultation is free and the piece of mind is priceless.

With the number of law firms out there that handle bankruptcy issues it can be a tough decision to know who to trust and what to pay for services. It’s not as easy as just doing a web search to find a Utah bankruptcy attorney and initiating contact. There are a lot of concerns you may have about the cost, confidentiality, personal issues, and the willingness of those you trust to handle your case with care and professionalism.

To help potential clients understand why we believe we are the best choice and have the best personnel, we have posted a new page on our site to help put you at ease. It explains 6 reasons you can confidently make that call to our law firm for your own free consultation and get a professional’s advice about your own situation. Bankruptcy may not be the best option for you and if it isn’t, we’re not going to steer you in that direction just to get your business. There are a variety of legal options available for people and your specific situation may require something different to help you out.

Before you choose someone else, view our 6 Reasons to Choose CSA for Your Utah Bankruptcy Attorney and read some unsolicited testimonials from clients about their experience with us.

In a chapter 7 bankruptcy, the debtor is often confronted with a reaffirmation agreement. To sign or not to sign, that is the question. Here are some answers to FAQs about reaffirmation agreements. These can be found on the disclosures required by law for a creditor to give to a debtor before entering into a reaffirmation agreement (Form B240A). This was previously brought up on our blog entry “Can I keep my car if I file for bankruptcy?”

A. DISCLOSURE STATEMENT

1. What are your obligations if you reaffirm a debt? A reaffirmed debt remains your personal legal obligation to pay. Your reaffirmed debt is not discharged in your bankruptcy case. That means that if you default on your reaffirmed debt after your bankruptcy case is over, your creditor may be able to take your property or your wages. Your obligations will be determined by the Reaffirmation Agreement, which may have changed the terms of the original agreement. If you are reaffirming an open end credit agreement, that agreement or applicable law may permit the creditor to change the terms of that agreement in the future under certain conditions.

2. Are you required to enter into a reaffirmation agreement by any law? No, you are not required to reaffirm a debt by any law. Only agree to reaffirm a debt if it is in your best interest. Be sure you can afford the payments that you agree to make.

3. What if your creditor has a security interest or lien? Your bankruptcy discharge does not eliminate any lien on your property. A ‘‘lien’’ is often referred to as a security interest, deed of trust, mortgage, or security deed. The property subject to a lien is often referred to as collateral. Even if you do not reaffirm and your personal liability on the debt is discharged, your creditor may still have a right under the lien to take the collateral if you do not pay or default on the debt. If the collateral is personal property that is exempt or that the trustee has abandoned, you may be able to redeem the item rather than reaffirm the debt. To redeem, you make a single payment to the creditor equal to the current value of the collateral, as the parties agree or the court determines.

4. How soon do you need to enter into and file a reaffirmation agreement? If you decide to enter into a reaffirmation agreement, you must do so before you receive your discharge. After you have entered into a reaffirmation agreement and all parts of this form that require a signature have been signed, either you or the creditor should file it as soon as possible. The signed agreement must be filed with the court no later than 60 days after the first date set for the meeting of creditors, so that the court will have time to schedule a hearing to approve the agreement if approval is required. However, the court may extend the time for filing, even after the 60-day period has ended.

5. Can you cancel the agreement? You may rescind (cancel) your Reaffirmation Agreement at any time before the bankruptcy court enters your discharge, or during the 60-day period that begins on the date your Reaffirmation Agreement is filed with the court, whichever occurs later. To rescind (cancel) your Reaffirmation Agreement, you must notify the creditor that your Reaffirmation Agreement is rescinded (or canceled). Remember that you can rescind the agreement, even if the court approves it, as long as you rescind within the time allowed.

6. When will this reaffirmation agreement be effective?

a. If you were represented by an attorney during the negotiation of your reaffirmation agreement and

i. if the creditor is not a Credit Union, your Reaffirmation Agreement becomes effective when it is filed with the court unless the reaffirmation is presumed to be an undue hardship If the Reaffirmation Agreement is presumed to be an undue hardship, the court must review it and may set a hearing to determine whether you have rebutted the presumption of undue hardship.

ii. if the creditor is a Credit Union, your Reaffirmation Agreement becomes effective when it is filed with the court.

b. If you were not represented by an attorney during the negotiation of your Reaffirmation Agreement, the Reaffirmation Agreement will not be effective unless the court approves it. To have the court approve your agreement, you must file a motion. See Instruction 5, below. The court will notify you and the creditor of the hearing on your Reaffirmation Agreement. You must attend this hearing, at which time the judge will review your Reaffirmation Agreement. If the judge decides that the Reaffirmation Agreement is in your best interest, the agreement will be approved and will become effective. However, if your Reaffirmation Agreement is for a consumer debt secured by a mortgage, deed of trust, security deed, or other lien on your real property, like your home, you do not need to file a motion or get court approval of your Reaffirmation Agreement.

7. What if you have questions about what a creditor can do? If you have questions about reaffirming a debt or what the law requires, consult with the attorney who helped you negotiate this agreement. If you do not have an attorney helping you, you may ask the judge to explain the effect of this agreement to you at the hearing to approve the reaffirmation agreement. When this disclosure refers to what a creditor “may” do, it is not giving any creditor permission to do anything. The word “may” is used to tell you what might occur if the law permits the creditor to take the action.

First, you must obtain advice from your attorney, permission from the Trust and the Court before embarking on this adventure. Some predatory lenders will be happy to charge you very high interest rates to buy a house. The longer you wait in your chapter 13, the better interest rate you can get. After 18 months of perfect payments to your Chapter 13 Trustee and to your mortgage lender, then most good lenders will extend a new loan. HUD underwriting rules state that the person in Chapter 13 bankruptcy can purchase a home and have FHA insurance. Requirements are that the applicant must have completed one year of payments as required while under Chapter 13. The applicant must then obtain a letter from the Trustee of the court, stating the dollar amount the applicant can borrow. See HUD Handbook 4155.1. http://www.hud.gov/offices/hsg/sfh/nsc/faqgnsrv.cfm

For more information, please visit this page on Chapter 13 Utah bankruptcies

What should I do with my bank account when I file bankruptcy? This is a question I often get from clients contemplating filing for bankruptcy protection.

The question generally arises out of two underlying common problems. First, if you are being pursued by your creditors, you risk having your bank account cleaned out by your creditors, and worse, sometimes by the bank itself, without any prior warning. Second, if your bank account has a negative balance or an overdraft balance associated with it, your account will most likely be closed by the bank upon filing bankruptcy. Assuming all things are in order with your bankruptcy, you will likely receive a discharge of the overdraft and negative balance, but it may now be difficult, even impossible to get a new bank account somewhere else.

You’ve heard of the big credit bureaus, TransUnion, Equifax, and Experian to whom your creditors report both positive and negative account information. The banking system has a similar reporting mechanism called “ChexSystems”. Your bank will report you to ChexSystems if your account is closed “for cause,” which generally means the bank was unable to collect an overdraft or negative balance or bounced check fees. When you discharge those debts in bankruptcy, the bank reports that fact to ChexSystems. The negative information will stay on your account for five years. ChexSystems only gathers negative information, no positive information to counterbalance the negative. So when you’re on ChexSystems, you’re on it, and it will be difficult to open a bank account without paying the unpaid balance.

Here’s a practical suggestion. Before you file bankruptcy, try to open a bank account (or credit union account), depositing only the minimum amount required to open it. Your chances of being able to open an account before bankruptcy are better than after filing bankruptcy. The account should be at an institution totally independent and separate from any of your debts. That way the bank won’t take you by surprise by cleaning out your bank account for being behind on another debt you owe them. After doing this, you will have a bank account in good standing in case you need it after the bankruptcy. Hold off for a while before you start switching all of your auto payments and direct deposits to this new bank account. Ask your employer to give you a paper check each pay day, then cash the check at the bank it is drawn on. Pay your bills with money orders. You will have more control over your money this way and be able to spend it on necessary living expenses instead of seeing it disappear when a garnishment hits your bank account.

These are just the basics. Your attorney can help you with respect to your specific situation.

If you are in financial distress, contact Ron Glines, our head Salt Lake City bankruptcy lawyer for immediate help and a free consultation.

We are often asked if bankruptcy will wipe out all of an individuals debts. The answer is yes, but with some exceptions. Bankruptcy will not normally wipe out:

• Money owed for child support or alimony;
• Most fines and penalties owed to government agencies;
• Most taxes and debts incurred to pay taxes which can not be discharged;
• Student loans, unless you can prove to the court that repaying them will be an “undue hardship”;
• Debts not listed on your bankruptcy petition;
• Loans you got by knowingly giving false information to a creditor, who reasonably relied on it in making you the loan;
• Debts resulting from “willful and malicious” harm;
• Debts incurred by driving while intoxicated;
• Mortgages and other liens which are not paid in the bankruptcy case (but bankruptcy will wipe out your obligation to pay any additional money if the property is sold by the creditor).

Visit this page to contact a Salt Lake City bankruptcy lawyer who can help you identify the specifics of your situation. The consultation is free and there is no fee unless you want to move forward with a bankruptcy.

DFAS stands for Defense Finance and Accounting Service, a government organization providing finance and accounting services to the Department of Defense (http://www.dfas.mil/). Among the many things they do is to act as the collection arm for debts owing to the federal government in connection with military service. If you join the armed forces, in some cases, you may qualify for an enlistment bonus. Upon signing an agreement to remain on active duty for a specified period, you are paid a bonus for your anticipated service. If you then fail to complete the required term specified in the agreement, you may be required to pay back your enlistment bonus or a pro rata share of it, based on the length of your service. See 37 U.S.C. 323.

Generally, a debt of this type is not dischargeable in bankruptcy, with one exception. If your bankruptcy discharge comes more than 5 years after termination of the written agreement referred to above, then the debt to repay the enlistment bonus is dischargeable. This exception, however, has little practical significance because you can expect DFAS to pursue you until they collect every penny long before the 5 year period expires. However, in the situation where you file a chapter 13 bankruptcy soon after departing from the military and terminating the enlistment bonus agreement, you may get the benefit of a discharge if your chapter 13 repayment plan lasts for 5 years. This type of unsecured non-priority debt is usually not required to be repaid in a chapter 13 plan. So even though you successfully make all your required plan payments to the bankruptcy trustee, this debt will remain unpaid, but will be discharged at the end of your plan.

If you need a Utah bankruptcy attorney, contact us today. Put our experience to work for you.