Mortgage Modification Mediation in Bankruptcy

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image of judge's gavelIn response to the foreclosure crisis, bankruptcy courts in several districts, including the Eastern District of Wisconsin, have adopted mortgage modification mediation programs. These programs attempt to provide some relief to debtors, especially those whose homes are in foreclosure or whose loan terms are more than they can afford. They allow parties to discuss mortgage modification in an informal setting as well as to provide a “fast track” for both the debtors and the lenders. The mediations are for negotiation purposes only and neither the debtors nor the lenders are required to enter into any agreement. The Bankruptcy Court will not force any modification and will make no adjudication except with the consent of both parties. Common issues to negotiate include a reduced interest rate (either temporary or permanent), moving payment for mortgage arrears to the end of the loan, and, in some instances, reducing the principal. Any or all of these outcomes are possible and will greatly improve the success of a Chapter 13 plan.

The program is streamlined to reduce costs, save considerable time, and make it easier for the parties to facilitate a loan modification. Mortgage Modification Mediation in the Eastern District of Wisconsin has helped several people work out meaningful mortgage modifications. Continue reading

Protecting Your Assets When Filing For Bankruptcy

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In most cases, when a person is filing for bankruptcy, he will be allowed to keep all of his assets. The rules that govern which assets are protected are referred to as “exemptions”, and these are set by the laws of the state in which you reside. While bankruptcy cases are done through the federal court system, the federal bankruptcy laws allow each state to determine which assets a person is allowed to keep when a bankruptcy case is filed. Exemptions vary, from one state to another. Some states have generous exemptions, some don’t. Proper exemption planning is essential to successfully accomplishing the debtor’s goal of protecting assets. However, great care must be taken. Non-attorneys, such as the so-called legal document preparers, paralegals, or other non-attorneys, cannot be relied upon to properly guide a person through the legal maze of bankruptcy laws. If the property has more equity in it than can be covered by every applicable exemption, (sometimes an asset may be cross-covered by more than one exemption) the bankruptcy trustee may sell the property. When the trustee sells the asset, the trustee will pay the amount of the exemption to the debtor, and retain the nonexempt amount of equity for the bankruptcy estate. Continue reading

Bankruptcy and Utilities – Preventing Disconnection

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image of a utility meterThe filing of a bankruptcy can help you to prevent your utility company from disconnecting your service, as well as to discharge any past due amounts. If you are behind on payments to your gas or electric provider, bankruptcy may provide a very useful remedy to you.

Wisconsin law states that if the utility service directly or indirectly affects the primary heat source of the home, consumers cannot be disconnected during the heating moratorium period from November 1 to April 15. But once April 15th comes around, if you are behind on utility payments, you are subject to disconnection.

The Bankruptcy Code specifically addresses utilities, and provides that a “utility may not alter, refuse or discontinue service” to a debtor who files for bankruptcy. In addition, the Bankruptcy Code allows you to discharge any amounts owed to the utility provider, and prevents that utility provider from disconnecting service as a result of those past due amounts. Continue reading

If You Are A Homeowner Facing Foreclosure

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foreclosure-home-sale-signIf you are facing foreclosure, bankruptcy might be able to help. A Chapter 13 bankruptcy can provide an effective solution to enable you to keep your home.

What is Foreclosure?

Foreclosure is the legal process the lender must go through in order to take over ownership of a property after the homeowner falls behind on mortgage payments. The process involves numerous steps, and takes several months. The lender is required to notify you when the foreclosure process is initiated, and due to the length of the process you will still have time to consult with an attorney after a foreclosure is begun to see if Chapter 13 is a good option to keep you in your home. Continue reading

Improving Your Credit Report After Bankruptcy

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Many consumers are under the impression that going through bankruptcy will ruin a person’s credit score. While it is true that the entry of a recent bankruptcy filing on a credit report may decrease the overall score, a consumer still has ways that he or she can improve that score. The person will want to take certain steps before and after filing for bankruptcy. Additionally, it would be wise for an individual considering filing for bankruptcy to do such with a reputable attorney. A reputable attorney will have the skills necessary to navigate the laws in a way that benefits the debtor. Continue reading

Combating Myths of Bankruptcy

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bankruptcy-blackboardThere are a lot of things that people hear about the bankruptcy process that are simply not true. These are some of the most common myths about bankruptcy.

1. You will lose your house, car, and other assets if you file a bankruptcy. This is one of the most common things that we hear from potential clients at the Bankruptcy Law Center. The truth is that if you hire an attorney who knows the bankruptcy laws and how to protect your assets, like the attorneys at the Bankruptcy Law Center, you will be able to keep your house, car, and other assets and still be able to discharge your debts in a bankruptcy. Continue reading

Should I File for Chapter 7 or Chapter 13 Bankruptcy?

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bankruptcyIf you are having problems paying your debts and considering filing for bankruptcy, it is important to understand what bankruptcy actually entails. There are crucial differences between a Chapter 7 and Chapter 13 bankruptcy that must be considered before deciding which type of bankruptcy to file. Here at the Bankruptcy Law Center, we can assist you with learning about the differences between the two types of consumer bankruptcy and assist you with understanding how it impacts you in both the short and long term.

Chapter 7 bankruptcy discharges your unsecured debts and allows you to continue to keep your secured debts like your house and your car. It generally takes about three months for you to receive your discharge order after you first file. You must meet certain income guidelines to qualify to file for Chapter 7. Certain types of debt including child support, federal student loans and taxes owed to the IRS are not discharged in bankruptcy. Unsecured debts such as credit card debts, medical bills, repossessions, evictions, and judgments are dischargeable in a Chapter 7 bankruptcy. Continue reading

Debt Free: A Fresh Start and a Sigh of Relief

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debt-freeAre you struggling under a mountain of debt with no hope in sight? Well, there is hope. You can halt collections and foreclosures immediately, wipe out most if not all of your debts, and get a fresh start.

We are Attorney Kristie Radloff and Attorney James Stanek of the Bankruptcy Law Center, with offices in Milwaukee, Racine, Elkhorn and Port Washington. We have helped thousands of people like you to wipe out their debts and get a fresh start. We want to help you, too. Continue reading

Important Steps To Take After Receiving Your Bankruptcy Discharge

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To rebuild your credit, we'll start with a bankruptcy worksheet

To rebuild your credit, we’ll start with a bankruptcy worksheet

Congratulations, you have successfully completed your bankruptcy and received a discharge of your debts. Other than not taking on any unnecessary debt, what should you do now in order to take advantage of your fresh start? After all, the goal is not just to get out of debt, but to thrive financially and create a better life for yourself. Here are a few steps you can take to rebuild your credit and maximize your chances of having a prosperous future:

1. Pay Your House and Car Payments On Time

If you plan to keep your home or car, continue to make your mortgage or car payments on time. The lenders will have retained their liens on the house and car, so if you want to keep them you must continue to pay for them, otherwise the lender will have a right to foreclose or repossess. And just as importantly, in order to begin rebuilding your credit, you want favorable reporting from these lenders, as house and car payments have a large impact on your credit score. Just by getting out of debt you have set yourself up to rebuild your credit within a relatively short time, and having favorable reporting from mortgage and car lenders will speed this process. Please note that if you did not reaffirm your mortgage or car loan, most likely your payments (or non-payments) will not be reported to the credit bureau. If that is the case, contact your attorney for further discussion on how to lessen the impact that non-reporting can have. If you obtained a car loan after your bankruptcy, be sure to make those payments on time, as that lender will most definitely report your payments to the credit bureaus. Continue reading

Income Tax Debt and Bankruptcy

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Do you owe income tax debt to the IRS?

Income tax debt is a very specific and troublesome sort of debt to have, but even tax debt can be treated in bankruptcy to aid a person suffering from this burden. Generally speaking, most tax debts can’t be wiped out in bankruptcy — you’ll continue to owe them at the end of a Chapter 7 bankruptcy, or you’ll have to repay them in full in a Chapter 13 bankruptcy repayment plan. But there are situations when tax debt will qualify for discharge. Here are some general rules concerning dischargeability of tax debt:

When You Can Discharge an Income Tax Debt

You can discharge (wipe out) debts for income taxes in Chapter 7 bankruptcy only if all of the following conditions are true: Continue reading