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Bankruptcy Lawyer: Hire One

In an uncertain economy, more and more people are considering filing for bankruptcy. With rising unemployment rates, ever-increasing interest rates, and mounting debt, many people find that filing for bankruptcy is their only option. While it is possible to file on your own, it is often difficult to navigate all of the steps without help. This is where a good bankruptcy lawyer comes in.

Attorneys specializing in bankruptcy proceedings are well-versed in all of the paperwork, seminars, and legal proceedings that the law requires. Many times they can assist you in acquiring all of the paperwork the courts will require you to present. They can also assist you in deciding which type of bankruptcy is right for you, and any tax ramifications that may come out of the proceedings.

Choosing an attorney to handle your case can be overwhelming, but it is important to choose carefully and not base your decisions only on the attorney’s fees. Asking friends and family for their advice, especially if they have gone through the process themselves, can point you towards reliable attorneys. Often, bankruptcy attorneys will offer a free consultation to discuss your case. This is important because you can get an idea of what you will need to do, as well as decide if you feel comfortable with that particular attorney. You can ask questions about how long they have been in practice, how many cases they have represented, their fees, and if they believe they can help you. It is important to remember that the attorney works with and for you, not the other way around!

You should also discuss your expectations with your lawyer, ask how long the process should take, and if the attorney will be handling the case himself, since some have a practice of allowing assistants or junior attorneys to handle the case. Your attorney should tell you immediately what steps you need to take to start the proceedings, and guide you through the entire process from beginning to end. You should feel comfortable speaking with your lawyer about any questions you have that may come up in the proceedings. It is typically required that you give your attorney all of your personal information, and he can help you collect your creditor information.

Every step in the bankruptcy process can affect your financial well-being, and you should be well- informed by your attorney of the potential ramifications of every decision. Your attorney can also guide you through the process of publishing your status, and notifying your creditors to stop all actions for collection pending your case. It is also his job to assist you in meeting with your court-appointed trustee, and in dealing with any legal actions from your creditors or their attorneys.

Filing for bankruptcy does not have to be overwhelming. A bankruptcy attorney can help you through the process from beginning to end, and relieve the stresses of the process. In many cases, he can also assist you, after the proceedings have concluded, in getting your financial life back on track. With a little diligence, a great attorney can be found to help even the most difficult case.

How To Get Rid Of A Second Mortgage When You File Bankruptcy

Most people who have done even a small amount of research know that Chapter 7 and Chapter 13 bankruptcy will eliminate most debts, but there is at least one additional benefit that Chapter 13 provides that few people who come in for a consultation know about. Chapter 13 will allow you to remove your second (or third) mortgage, leaving you with only your first mortgage when you exit your Chapter 13 bankruptcy. Lawyers call this “lien stripping”.

This is how it works. First, we can only strip a second mortgage if your first mortgage exceeds the value of your home. So, if your home is worth $100,000 and you only owe $99,999 on your first mortgage, we can’t get rid of your second. Before we even file your petition, we’ll recommend you have an appraisal done so we can be sure of your home’s value. If you’ve refinanced recently, we can probably use that appraisal. After we file your petition, we’ll file a motion to determine secured status arguing that the second mortgage should be stripped because there is no value in your home for the second mortgage to secure. If we’ve done our homework, the court should approve the motion without a problem.

Once the court approves our motion to determine secured status, your second mortgage gets treated the same way the rest of your unsecured creditors do in Chapter 13. They get a portion of whatever you send to the bankruptcy trustee every month (which is based on your disposable income). You should be aware that the second mortgage will only be removed if you complete your Chapter 13 bankruptcy. If your Chapter 13 gets dismissed, your second mortgage lender will again have a secured interest in your home. If you default on that loan it could exercise its right to foreclose, just like before you filed.

You should also keep in mind that Chapter 7 does not allow you to lien strip. This is just one reason someone might choose to file a 7 instead of a 13. If you qualify for Chapter 7, it probably only makes sense to file a Chapter 13 to strip a second mortgage if that mortgage is substantial. You might not be able to strip your second in a 7, but you’ll be through the bankruptcy process much sooner (four to six month versus three to five years).

Chapter 13 bankruptcy may allow you to get rid of your second (or third) mortgage. Consider talking to a bankruptcy lawyer before you decide if it’s a good option for you. Most offer free consultations.

Can I Keep My Home If I File Bankruptcy?

One of the first questions people ask when they begin to explore their Denver bankruptcy options is, “Can I keep my house if I file bankruptcy in Colorado?” While this question cannot be answered without knowing the specifics of the situation, the answer is generally, “yes.”

A number of factors must be evaluated before determining whether it is possible – or wise – to keep your home after filing bankruptcy. The first thing a debtor will need to know is whether they are filing Chapter 7 Bankruptcy (liquidation) or Chapter 13 Bankruptcy (reorganization). In either case, most debtors are able to keep their home; however, it is important to know the differences between the two Chapters if your goal is to keep your home. Other important factors include: the amount of equity in your home, whether you have missed any payments, and whether the house is your primary residence.

Keeping your Home in a Chapter 7 Bankruptcy

A Chapter 7 Bankruptcy is a liquidation and any assets which are not protected will be liquidated in order to raise money for creditors. Colorado Bankruptcy law affords homeowners a $60,000 homestead exemption to protect the equity in their homes and $90,000 if you are 60 years of age or older. For example, if a debtor owes $250,000 on their home and it is valued at $300,000 they are left with $50,000 in equity. The debtor may exempt all $50,000 of equity, meaning the bankruptcy court will not be able to liquidate the house because all of the equity is protected by the homestead exemption. An important note is that this exemption only applies to the debtor’s primary residence and not to rental, vacation or investment properties.

When filing a Chapter 7 Bankruptcyin Denver, the most important step in keeping one’s home is making sure the monthly mortgage payments are kept current. Even if the equity in your home is protected by the homestead exemption, a mortgage company or lien holder can still foreclose on the home if a debtor is behind on their payments. Generally, mortgage companies do not initiate foreclosures until a number of payments have been missed, however, the only way to completely protect a home from foreclosure is to stay current on the payments.

Keeping your home in a Chapter 13 Bankruptcy

For a debtor who is behind on their mortgage payments and who would like to keep their home, a Chapter 13 Bankruptcy may be the best avenue for doing so. A Chapter 13 is not a liquidation, meaning the Court will not liquidate assets in order to raise money for creditors. In a Chapter 13, the Court will compare a debtor’s expenses and income to determine how much disposable income is available to repay creditors. That disposable income will be paid to the Court each month for a set period (generally 60 months) and that money is divided up and paid to creditors. If a debtor is in arrears on their mortgage, some of these monthly Chapter 13 payments can be used to catch up these arrearages. The debtor must also resume making their regular monthly payment in addition to their Chapter 13 payments. Thus, while it is possible to catch up on your mortgage payments in a Chapter 13, it is not always the best option because it may be impractical or impossible for a debtor to make their mortgage payment in addition to the amount that must be paid to the Bankruptcy Court each month.

Disclaimer: The information contained in this distribution is intended for informational purposes only. It is not intended as professional advice and should not be construed as such. Do not take legal action based on this content! Always contact a lawyer near you.