San Fernando Valley Bankruptcy Forum

http://myemail.constantcontact.com/Collect-More-in-2012-.html?soid=1102694247981&aid=W1dSOR-lqQg

2012-01-03T12:42:00.000-08:00

Collect More in 2012! We represent honest debtors and trustworthy creditors. http://myemail.constantcontact.com/Collect-More-in-2012-.html?soid=1102694247981&aid=W1dSOR-lqQg

BANKRUPTCY AND TAX PROBLEMS GO HAND IN HAND

2011-11-30T16:26:00.000-08:00

At the Law Offices of Michael H. Raichelson, we find that over extended debtors often have tax problems. That is why we handle Offer in Compromises with the I.R.S. up to certain levels. In addition, we have access to quality tax professionals if your situation demands greater expertise.

An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. The I.R.S. will consider your ability to pay, your income, your expenses, and assets. Every situation is unique.

An offer in compromise is generally accepted by the I.R.S. if the amount offered is likely the most that the I.R.S. may expect to collect within a reasonable period of time. Contact our office with locations in Woodland Hills near Los Angeles and Oxnard in Ventura County to explore all of your options if you are over extended and have tax problems.

Foreclosure crisis only about halfway over

2011-11-17T16:09:00.000-08:00

According to this article, we are in the 4th inning of a 9 inning baseball game with regards to the foreclosure crisis. At the Law Offices of Michael H. Raichelson, we can stop a foreclosure on the day of the auction. Call 818-444-7770 for more information. Foreclosure crisis only about halfway over

FORECLOSURE WORKSHOP

2011-11-17T09:50:00.000-08:00

Michael H. Raichelson, who owns a bankruptcy and litigation firm with offices in Woodland Hills, CA and Oxnard, CA, is pleased to announce that he is one of two main speakers discussing foreclosure, bankruptcy and loan workouts on December 7, 2011 at the Four Points Sheraton in the Ventura Harbor. To get more information, click on the following link: BOOT CAMP: Foreclosure and Loan Workout Procedures

Woodland Hills Bankruptcy Attorney Near Los Angeles Obtains Dismissal of Adversary Complaint Seeking an Order to Prevent Discharge of Approximately $250,000 in Debt

2011-11-09T08:55:00.000-08:00

Woodland Hills Bankruptcy Attorney Near Los Angeles Obtains Dismissal of Adversary Complaint Seeking an Order to Prevent Discharge of Approximately $250,000 in Debt

http://myemail.constantcontact.com/The-Raichelson-Monthly-Bankruptcy-Brief-October-2011.html?soid=1102694247981&aid=s7Sh5ALqLr4

2011-10-07T11:14:00.000-07:00

http://myemail.constantcontact.com/The-Raichelson-Monthly-Bankruptcy-Brief-October-2011.html?soid=1102694247981&aid=s7Sh5ALqLr4

Woodland Hills Attorney Michael H. Raichelson Near Los Angeles Confirms Chapter 11 Plan Reducing I.R.S. Tax Debt from $901,021.48 to $150,000 Payable Over Seven Years

2011-09-28T14:03:00.000-07:00

Woodland Hills Attorney Michael H. Raichelson Near Los Angeles Confirms Chapter 11 Plan Reducing I.R.S. Tax Debt from $901,021.48 to $150,000 Payable Over Seven Years

LIFE AFTER A CHAPTER 7 BANKRUPTCY - MONITORING, REPAIRING AND REBUILDING YOUR CREDIT

2011-09-13T16:38:00.000-07:00

After going through the chapter 7 bankruptcy process, you deserve a fresh start. However, if you do not take steps following your discharge to 1) monitor your credit; 2) clear up inaccuracies in your credit report; and 3) rebuild your credit, the opportunity you have following a chapter 7 bankruptcy could be squandered. To get the most out of this opportunity, you should use the tools we offer through our website to 1) monitor your credit; 2) repair your credit; and 3) rebuild your credit.

Credit Monitoring

A low credit score makes it difficult to finance purchases such as cars, furniture and a house. So, it is critical that you monitor your credit after receiving your chapter 7 bankruptcy discharge. Also, it can make it difficult to lease an apartment or obtain a student loan. Our experience indicates that if your credit score is 600 points or below prior to filing the chapter 7 bankruptcy, it may increase as much as 150 points within 12 months after filing if you conduct yourself properly. Below is a link allowing you to check your efforts to bring up your credit score. You should go to our website and sign up for credit monitoring on our home page.

Credit Repair

What do you do if you find that your credit furnishers (i.e., the credit card companies) are not reporting your credit history properly after filing a chapter 7 bankruptcy? There are certain procedures in place which will ensure that the furnishers are reporting accurately and the credit reporting agencies are doing their job properly. We have access to credit repair professionals located in and near the Los Angeles area who can assist you if the credit card companies are issuing false reports regarding your discharged debts after receiving your chapter 7 bankruptcy discharge.

Rebuilding your Credit

To rebuild your credit, you should learn the healthy habits that make your credit score rise. Those include paying your bills on time, living within your means, and not submitting too many credit applications too quickly following a chapter 7 bankruptcy discharge.

Also, obtaining a secured credit card may be the key to rebuilding your credit. A secured credit card requires cash collateral, such as a deposit, before the card is issued. If you demonstrate a good payment history, the secured credit card company may increase your credit limit without requiring additional cash collateral. Also, the card issuer reports to the three major credit reporting agencies which - in turn - starts the process of building a good post bankruptcy credit history. We have chosen to include a link on our website to apply for a secured credit card so that our clients may start rebuilding their credit right after they receive their bankruptcy discharge.

The best way to use your secured credit card is to buy a small number of items every month and pay the bill in full every month. The Law Offices of Michael H. Raichelson, which is a bankruptcy firm near Los Angeles, is now affiliated with a bank that offers a secured credit card. Go to the bottom of our home page to learn more.

Los Angeles Attorney Confirms Chapter 11 Plan Which Reduces Principal Balances on Mortgages and Lowers Interest Rates Substantially

2011-08-06T08:17:00.000-07:00

Los Angeles Attorney Confirms Chapter 11 Plan Which Reduces Principal Balances on Mortgages and Lowers Interest Rates Substantially

HOW WILL DEBT CEILING TALKS IN WASHINGTON IMPACT ME?

2011-07-25T13:05:00.000-07:00

Most people who watch the news, ask themselves, "why does the news devote so much time to debt talk negotiations in Washington, and why should I care?" The simple answer is that if the United States defaults on its debts or its credit rating goes down, your interest rates are going up. And, if interest rates go up, the economy will likely suffer.

Why would interest rates go up? Well, Washington is the largest borrower on the planet. If Washington borrows more money, competition for money will increase. If competition for money increases, then supply and demand dictates that the cost of money goes up. The cost of money is the interest rate.

If there is a default or if the credit rating is lowered, the government will have to spend more money in interest to borrow the same amount of money. If interest payments go up, then the government will have to borrow money to cover the increased interest payments. This could end up in a vicious cycle where Washington's borrowing goes up and up and up. If this is the case, the average consumer and business will be crowded out of the ability to borrow money, and the cost of borrowing will increase.

So, if you are a consumer, my recommendation is to reduce your debt so that you are not impacted by the inevitability of higher interest rates. You can do this in two ways: 1) pay off your debt quicker or consider a bankruptcy to eliminate your debts if paying them off is not an option. Contact the Law Offices of Michael H. Raichelson, which is located in the San Fernando Valley near Los Angeles.

NEW LAW STOPS 2ND MORTGAGE FROM PURSUING DEFICIENCY FOLLOWING A SHORT SALE!

2011-07-21T11:45:00.000-07:00

Many homesellers have completed a short sale in the last four years and subsequently find that their 2nd mortgage could go after them for the deficiency years later. After receiving a lawsuit for the deficiency, debtors reach out to the Law Offices of Michael H. Raichelson to eliminate this debt.

Now, starting immediately, this hole in the law has been plugged in California. California Senate Bill 458 was signed into law on July 15th and is effective immediately for all short sale transactions that close after July 15, 2011. The law provides that junior lien holders no longer have any deficiency rights against the borrower after a short sale.

This is a major coup for debtors. It removes the potential for deficiency liability after the short sale is completed and thus brings more certainty to the short sale process for borrowers. Hopefully, this will make the short sale process quicker by eliminating the deficiency issue from the bargaining table. Contact the Law Offices of Michael H. Raichelson to learn more about debt solutions and bankruptcy.

San Fernando Valley Bankruptcy Forum: HOW LONG DOES A CHAPTER 7 BANKRUPTCY TAKE?

2011-07-19T18:12:00.000-07:00

San Fernando Valley Bankruptcy Forum: HOW LONG DOES A CHAPTER 7 BANKRUPTCY TAKE?: "The first question out of most of our potential clients’ mouths is “how long does a bankruptcy take?” Typically, a Chapter 7 bankruptcy l..."

San Fernando Valley Bankruptcy Forum: WHAT IS THE CONSUMER FINANCIAL PROTECTION BUREAU?

2011-07-19T18:08:00.000-07:00

San Fernando Valley Bankruptcy Forum: WHAT IS THE CONSUMER FINANCIAL PROTECTION BUREAU?: "A portion of the Law Offices of Michael H. Raichelson's mission is to help individual consumers by reducing or eliminating their debt thro..."

WHAT IS THE CONSUMER FINANCIAL PROTECTION BUREAU?

2011-07-19T18:07:00.000-07:00

A portion of the Law Offices of Michael H. Raichelson's mission is to help individual consumers by reducing or eliminating their debt through bankruptcy. As part of that mission, we feel that it is important to educate individual consumers and our clients regarding protections available to them now and what lies ahead.

One year ago, Congress passed and President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which created this new Consumer Financial Protection Bureau (CFPB). On July 21, 2011, the CFPB starts working.

What is the CFPB? According to its website, the central mission of the CFPB is to make markets for consumer financial products and services work for Americans—whether they are applying for a mortgage, choosing among credit cards, or using any number of other consumer financial products. The CFPB is setting up a system to receive your complaints and answer your questions about consumer financial products and services. Supposedly, the CFPB will be the proverbial cop on the beat, enforcing laws related to

credit cards, mortgages, student loans, prepaid cards, and other kinds of financial products and services.

The CFPB intend on using its website and toll-free number to help consumers—and to help them do a better job of enforcing the law. Until such time, contact the Law Offices of Michael H. Raichelson for a free consultation regarding debt solutions.

HOW LONG DOES A CHAPTER 7 BANKRUPTCY TAKE?

2011-07-12T12:17:00.000-07:00

The first question out of most of our potential clients’ mouths is “how long does a bankruptcy take?”

Typically, a Chapter 7 bankruptcy lasts four months from beginning to end. First, you must gather up all of the relevant documents, such as income tax returns for the last two years, paycheck stubs for the last six months, collection letters, credit card statements, checking/saving account statements, etc. Second, you must complete a pre-filing credit counseling course. This course may be done on line and takes about two hours to complete. In October 2005, bankruptcy laws changed and the new law requires that a pre-filing and post-filing course be completed before receiving a discharge. Third, after the petition, schedules and forms are completed, the bankruptcy must be filed electronically. Instantly, a hearing date for a meeting of creditors will be provided. This administrative hearing is generally held 30 days after filing.

Finally, you must complete a post filing debtor education course. Also, at least 60 days must pass from the meeting of creditors before the bankruptcy court has the authority to enter a discharge order, which eliminates your legal obligation for your unsecured debts.

At the Law Offices of Michael H. Raichelson, we have counseled thousands of individuals and businesses regarding their debt problems and potential solutions. We offer a free consultation.

FILING FOR BANKRUPTCY - THE TOP FIVE PITFALLS TO AVOID!

2011-07-01T13:40:00.001-07:00

If you are filing for bankruptcy, here are the top five pitfalls that you should avoid:

1. Make sure that your paperwork is complete and accurate. Measure twice, cut once. If the bankruptcy trustee who reviews your paperwork believes that it is not accurate, he or she will look further for mistakes.

2. Make sure that your income and expenses are correctly stated.

3. Make sure that you send the bankruptcy trustee your most recently filed federal income tax returns at least one week prior to your meeting of creditors.

4. Make sure that you check your checking and savings account balances on the day you file so that the amount you put in the paperwork is substantially similar or identical to the amount in your account.

5. TELL THE TRUTH. If you believe that filing for bankruptcy keeps you up at night, then an investigation by the FBI regarding bankruptcy fraud will be a nightmare.

To learn more about the pitfalls to avoid when filing for bankruptcy, contact the Law Offices at Michael H. Raichelson.

San Fernando Valley Bankruptcy Forum: CAN I STRIP A LIEN ON MY HOUSE IN A CHAPTER 13 BAN...

2011-06-28T10:41:00.000-07:00

San Fernando Valley Bankruptcy Forum: CAN I STRIP A LIEN ON MY HOUSE IN A CHAPTER 13 BAN...: "Most of our clients with first and second mortgages ask this question: Can I strip off my second mortgage in a bankruptcy ? The short answe..."

CAN I STRIP A LIEN ON MY HOUSE IN A CHAPTER 13 BANKRUPTCY?

2011-06-28T10:40:00.000-07:00

Most of our clients with first and second mortgages ask this question: Can I strip off my second mortgage in a bankruptcy? The short answer is, it depends. If your house is worth $500,000 and the balance on your first mortgage is $501,000, then you will likely be able to strip the lien off of your house for your second mortgage.

First, you must get your house appraised to see if the value of your house is below the principal balance of your first mortgage. Second, a consumers ability to strip a lien off of your house is only available in a Chapter 13 bankruptcy. So, you must file a Chapter 13 bankruptcy. Third, you must be able to show the Court that the Chapter 13 plan you are proposing is feasible and that your creditors will receive as much through a Chapter 13 plan as they would have otherwise received in a hypothetical Chapter 7 liquidation.

This is a complicated process and it is recommended that you contact an experienced Chapter 13 bankruptcy attorney, like the attorneys at the Law Offices of Michael H. Raichelson

The Law Offices of Michael H. Raichelson is Providing Free Credit Counseling and a Free Credit Report.

2011-06-27T14:40:00.000-07:00

The Law Offices of Michael H. Raichelson is Providing Free Credit Counseling and a Free Credit Report.

IS BANKRUPTCY THE RIGHT CHOICE FOR ME?

2011-06-24T16:56:00.000-07:00

I have had clients who maintain that bankruptcy is not the right thing for them because they have a high credit score. I high credit score is worthless if you have no money in the bank and no ability to pay off your credit card debts within three to five years. Also, if you are robbing Paul to pay Peter, then you are just fooling yourself. Generally, there is no way out of this cycle but bankruptcy at that point. At the Law Offices of Michael H. Raichelson, we do not counsel people to file bankruptcy. But, we do tell people to take a realistic look at their finances, and if they cannot pay off their credit card debt in three to five years, they need to seriously consider bankruptcy.

This is even more true if you are older. The older you are, the less years you have to save for retirement. Call the Law Offices of Michael H. Raichelson for free consultation.

ORGANIZING YOUR DOCUMENTS FOR BANKRUPTCY

2011-06-15T12:11:00.000-07:00

When considering bankruptcy, people panic and put off the decision because their documents are a mess. I am telling you from experience, do not worry about it. I have literally had dozens of people walk into my office with trash bags full of documents, including dunning notices, collection letters, credit card statements, notices of trustee’s sale, etc. The list goes on forever.

First, much of the information necessary to evaluate your situation and a potential bankruptcy filing may be obtained from your credit report. Get a credit report that combines the information from the three large credit bureau agencies, Experian, Equifax, and Transunion. If you hire an attorney to file bankruptcy, he or she can easily obtain the credit report through one of the services that offer credit reports for bankruptcy attorneys. This is a special credit report that contains not only up to date balances, but also special addresses identified by creditors for receiving bankruptcy notices. Second, if you are planning on filing bankruptcy (or want to evaluate your situation), put the following documents in a pile:

1. Six months of paycheck stubs;

2. Income tax returns for the last three years;

3. Six months of bank account statements;

4. Collection letters;

5. Lawsuit documents, such as complaints and judgments;

6. Most recent mortgage statements, homeowners association statements and car loan statements; and

7. Original social security card and driver’s license;

Third, if you do not have a system for organizing the documents and feel overwhelmed, do the following: Put the documents in stacks. Put all of your income tax returns in one stack, put your bank account statements in another stack, put your credit card statements in another stack, etc. Then, put the documents in chronological order, with the most recently received document on the top.

Call the Law Offices of Michael H. Raichelson for a free consultation, and we will assist you in getting your documents organized.

HOW TO IMPROVE YOUR CREDIT SCORE!

2011-06-14T09:58:00.000-07:00

REDUCE YOUR DEBT. The most basic and obvious way to improve your credit score is to reduce the debt you owe. Do not use your credit cards anymore and make more than the minimum payments.

CHECK YOUR CREDIT REPORT. Make sure that no late payments are identified in your credit report in error. If there is an error, dispute it with the credit bureau and reporting agency.

DO NOT BE LATE. 35% of your credit score is your payment history. Set up payment reminders so that you do not make late payments. Or, enroll in automatic payments through your credit card company.

KEEP BALANCES LOW. 30% of your credit score are amounts owed. Pay off your debt rather than robbing Paul to pay Peter.

If you cannot pay off your unsecured debt in three to five years, you may be a good candidate for bankruptcy. Call the Law Offices of Michael H. Raichelson today to set up a free initial consutlation.

BANKRUPTCY IS NOT A BAD WORD! SHOULD I FILE BANKRUPTCY?

2011-06-13T10:20:00.000-07:00

Bankruptcy is not a bad word. I chose to write this blog because most of my clients start our initial consultations telling me that they are ashamed, humiliated or embarrassed at the prospect of filing bankruptcy. Or, they say that their fico score is above 700 and they have never made a late payment. They think that bankruptcy is for the “other guy”, not for them. Well, I am here to tell you that “bankruptcy” is not a bad word, that a fico score above 700 does not mean anything if you have no money in the bank, and robbing Paul to pay Peter so that you do not make a late payment is only digging you into a bigger hole.

Shame, humiliation, or embarrassment will not pay for your child’s education, your retirement, your medical bills or your family’s needs. It will also prevent you from having money in your bank account. Bankruptcy is not for the “other guy” if you lost a job, suffered reduced hours at work, have health issues, cannot pay off your debts in three to five years or feel like you are suffocating under the weight of making your minimum monthly payments. I am here to tell you that “bankruptcy” is not a bad word. You are the only one who will provide for yourself.

During the financial crisis that began in 2007, mortgage companies went belly up, not credit card issuers. Capital One, Citibank, Wells Fargo, American Express, Discover, Visa, Mastercard are doing just fine. Do not feel sorry for them. If you lie awake at night thinking about which card has not been tapped out, feel anxious over making your mortgage payment or you are worried about a cut in hours and how that will impact your ability to make the minimum payments on your credit cards, you must speak with a bankruptcy attorney. Contact the Law Offices of Michael H. Raichelson for a free consultation.

Do not let shame, humiliation or embarrassment block you from getting a fresh start. What are you waiting for? The longer you wait, the more serious your financial crisis will become and the more difficult it will be to climb out of the abyss. By reading this blog, you have taken the first step towards financial freedom. That is why I am here telling you to get help now.

HOW DO YOU START A CHAPTER 7 BANKRUPTCY?

2011-06-06T08:02:00.000-07:00

A chapter 7 case begins with the debtor filing a petition with the bankruptcy court serving the area where the individual lives or where the business debtor is organized or has its principal place of business or principal assets. In addition to the petition, the debtor must also file with the court: (1) schedules of assets and liabilities; (2) a schedule of current income and expenditures; (3) a statement of financial affairs; and (4) a schedule of executory contracts and unexpired leases. Fed. R. Bankr. P. 1007(b). Debtors must also provide the assigned case trustee with a copy of the tax return or transcripts for the most recent tax year as well as tax returns filed during the case (including tax returns for prior years that had not been filed when the case began). 11 U.S.C. § 521. Individual debtors with primarily consumer debts have additional document filing requirements. They must file: a certificate of credit counseling and a copy of any debt repayment plan developed through credit counseling; evidence of payment from employers, if any, received 60 days before filing; a statement of monthly net income and any anticipated increase in income or expenses after filing; and a record of any interest the debtor has in federal or state qualified education or tuition accounts. A husband and wife may file a joint petition or individual petitions. 11 U.S.C. § 302(a). If filing jointly, a husband and wife are subject to all the document filing requirements of individual debtors.

To learn more about a chapter 7 bankruptcy, call the Law Offices of Michael H. Raichelson at 818-444-7770.

DOES THE ABSOLUTE PRIORITY RULE APPLY TO INDIVIDUALS IN A CHAPTER 11 AFTER BACPA?

2011-06-01T07:10:00.000-07:00

Our office recently faced a challenge to an individual Chapter 11 Plan of Reorganization based on the absolute priority rule. The rule, which generally requires creditors with priority to be paid in full, before a lesser class of creditors receive payment of value, was eliminated for individuals filing a Chapter 11 under BACPA.

There is a minority of cases reading BACPA narrowly and still applying the absolute priority rule to individual debtors who file a Chapter 11. We believe that these cases (i.e., In re Gelin, In re Mullins, In re Gbadebo, and In re Karlovich), which advocate a narrow reading of the BACPA amendments, go against public policy, are not practical, and are off the mark. You have to ask the question -- Why else would Congress make this change? As put simply by one court, the main thrust of the BAPCPA changes was to “adopt and adapt as much of Chapter 13 as possible with respect to individual debtors in Chapter 11.” In re Shat, 424 B.R. 854, 862 (2010).

Congress amended BACPA to make Chapter 11 resemble Chapter 13. This is relevant because Chapter 13 does not have a version of the absolute priority rule. The commonly accepted reason why is that creditors in a Chapter 13 case do not need the protections of the absolute priority rule because they are protected by the disposable income requirement of §1325(b) – a provision Congress added to Chapter 11 as § 1129(a)(15). 7 Norton Bankr. L. & Prac. 3d § 122.15 (2011). Seen this way, the changes to the absolute priority make perfect sense: because the overall effect of the BAPCPA changes was to make Chapter 11 for individuals more like Chapter 13, the absolute priority rule was no longer needed in Chapter 11 for cases involving individuals.

Also, there are thousands of similarly situated individual debtors that do not qualify for a Chapter 13 in that they are above the debt limits. Let’s pretend that these debtors qualified for a Chapter 13, then there would be no argument – The absolute priority rule would not apply. So, what opportunity do the thousands of individual debtors who are similarly situated have to reorganize their debts? If you follow the narrow reading put forth by minority view, these debtors would be out of luck simply by happenstance (i.e., that their debts exceed the Chapter 13 limits). This would be an implausible turn of events in the current economic climate. It would not only harm debtors who put forth workable plans in good faith, but also hurt the overall economy by further flooding the market with countless non-performing loans. This approach is simply misguided and against public policy.

Finally, it should also be noted that bankruptcy is intended to be rehabilitative, not punitive. As a community, we have decided to give debtors a second chance through bankruptcy so that they, and their property, can be put to productive use again for the betterment of all of society. The wrongful interpretation argued by the minority would be punitive, not rehabilitative.

For more information, contact the Law Offices of Michael H. Raichelson.

DISCLOSE ALL OF YOUR ASSETS IN BANKRUPTCY

2011-05-12T10:29:00.000-07:00

Never omit assets in your bankruptcy filings or sells/steal assets after your filing. On May 6, 2011, a 13-count indictment was issued by a federal grand jury accuses former All-Star outfielder Lenny Dykstra of bankruptcy fraud for allegedly stripping his $18 million mansion in Ventura County.

Dykstra, a former Major League Baseball player, is charged with one count each of bankruptcy fraud and obstruction of justice, four counts each of concealing property from the bankruptcy estate and making false declarations to the Bankruptcy Court, and three counts of embezzlement from the bankruptcy estate.

Federal prosecutors allege that after he filed for bankruptcy protection in July 2009, Dykstra looted his Sherwood Estates mansion, lied about who stripped the home and denied receiving money for having sold items that were owned by the Bankruptcy Estate.

It is important to make sure that your bankruptcy petition and schedules are accurate to the best of your knowledge. You sign them under penalty of perjury. In order to avoid any problems, it is important to hire experienced counsel. At the Law Offices of Michael H. Raichelson, we have filed hundreds of bankrutpcy petitions and helped over a thousand individuals and families put their homes back in order. Call us for a free consultation.

NO GOOD OPTIONS FOR HOMEOWNERS EXCEPT BANKRUPTCY

2011-05-06T12:36:00.000-07:00

On April 28, 2011, the F

We have continually seen servicers railroading a homeowners, by not allowing them to modify their loan, losing their loan modification paperwork, and/or speaking out of both sides of their mouths. Right now, we are seeing very few, if any, successful loan modifications. You either make too much money or not enough. You either have too little equity or too much equity. That is why bankruptcy is not a bad word, but rather an attractive option to regain control of your financial resources. At the Law Offices of Michael H. Raichelson, we are comitted to securing a bright financial future for our clients through bankruptcy. Contact us for a free consultation to see if you qualify. ederal Housing Finance Agency Acting Director Edward J. DeMarco directed Fannie Mae and Freddie Mac to establish consistent guidelines for servicing delinquent mortgages they own or guarantee. The Agency is attempting to establish uniform servicing requirements in an effort to obtain earlier identification for the best solution available to homeowners who are deliquent on their loans. From the Law Offices of Michael H. Raichelson, we say "Good luck!"

CAN I KEEP MY CAR OR HOUSE IN BANKRUPTCY?

2011-05-04T17:33:00.000-07:00

At the Law Offices of Micahel H. Raichelson, we provide straight answers and get our clients the best results possible. Many of our clients ask us whether they can keep their car or house in a bankruptcy.

You will not lose your home or car during your bankruptcy case as long as your equity in the property is fully exempt. In California, depending on your circumstances, you can keep up to $26,000 of cash and cars or between $75,000 to $175,000 in equity in a house. You cannot do both.

Even if your property is not fully exempt you may still be able to keep your property by filing a chapter 13 bankruptcy instead of a chapter 7 bankruptcy. In a chapter 13 bankruptcy, you will be required to pay at least the equivalent of the non-exempt equity you have in your home or car and any amount you are behind on your home or car loan over the course of the three to five plan. You also will be required to continue making the regular monthly payments. It is complicated. That is why you should contact the experienced attorneys at the Law Offices of Michael H. Raichelson to discuss your situation.

WHEN DO YOU RECEIVE A DISCHARGE IN BANKRUPTCY

2011-04-25T13:09:00.000-07:00

A discharge order is the end result of a bankruptcy filing. When you receive your discharge order depends on what type of bankruptcy you filed. In a typcial chapter 7 case, you receive a discharge order after the expiration of the time period for filing objections to a discharge. Generally, creditors have until 60 days following a meeting of creditors to object to your discharge. If no objections are received, the court's in Southern California typically issue the discharge order within 15 days after the time period has expired.

Incase involving repayment plans, i.e., chapter 11, 12 and 13, the court generally grants the discharge as soon as practicable after the debtor completes all payments under the plan. Individual repayment plans are typically found in a chapter 13 case, and chapter 13 repayment plans generally last between three to five years.

It should be noted that a court may deny an individual debtor's discharge in a chapter 7 or 13 case if the debtor fails to complete "an instructional course concerning financial management."

It is recommended that you speak with a competent bankruptcy attorney to avoid any mishaps. The Law Offices of Michael H. Raichelson has counseled over 1,000 individuals and businesses regarding their debt.

LENNY DYSTRA AND BANKRUPTCY FRAUD

2011-04-18T12:30:00.001-07:00

Last week, former Major League Baseball star and supposed financial expert Lenny Dykstra was charged with selling memorabilia, purportedly embezzling property from his bankruptcy estate. Dykstra allegedly sold sports memorabilia and items from his mansion. Generally, a debtor in bankruptcy cannot sell assets that are part of the bankruptcy estate in that the assets are to be liquidated in orderly fashion by the bankruptcy trustee to pay back creditors.

A debtor in bankruptcy must know that there are penalties for bankruptcy fraud. The penalty depends on the seriousness of the violation. The debtor could be hit with a monetary penalty, a dismissal of their case, criminal prosecution and/or jail time. The way to minimize or eliminate potential bankruptcy fraud issues is to hire an experienced bankruptcy law firm such as The Law Offices of Michael H. Raichelson.

BANKRUPTCY BASICS

2011-04-18T08:30:00.000-07:00

The Bankruptcy Code is a strong remedy and is in place to provide relief to those who are facing overwhelming financial pressures. For example, if a client is facing repossession or foreclosure, the filing of a bankruptcy petition necessarily triggers the Automatic Stay, which is a powerful weapon to stop repossessions, foreclosures, debt collectors, and lawsuits. Under limited circumstances, debt collection efforts may continue if the court lifts the Automatic Stay after a noticed motion. If the automatic stay is lifted, the moving creditor may commence or continue evictions, repossessions and foreclosure actions even after the bankruptcy petition is filed. That is why your clients need an experienced bankruptcy attorney to guide them through the Bankruptcy Code and Bankruptcy Procedure labyrinth. Contact The Law Offices of Michael H. Raichelson for a free consultation.

What chapter your client chooses to file under, what bills can be eliminated, how long payments can be stretched out, and other details are controlled by the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure. The Bankruptcy Code and Federal Rules of Bankruptcy Procedure are uniform throughout the United States. However, state laws, such as sections 703 and 704 of the California Code of Civil Procedure, will determine what assets your client can protect in a bankruptcy proceeding, and local bankruptcy rules of court may impact notice requirements and pleading requirements. Also, a judges’ interpretation of the bankruptcy laws and cases may vary from courtroom to courtroom and division to division within a district. Know your judge!

Any person, partnership, corporation, or business trust may file a bankruptcy. If the debtor files a petition and starts the bankruptcy, this is called a voluntary bankruptcy. If one or more of the debtor’s creditors initiates the bankruptcy, this is called an involuntary bankruptcy. Practitioners should read and understand the rules allowing for an involuntary bankruptcy in that if an involuntary bankruptcy is filed improperly, the case will likely get dismissed. Also, upon dismissal of the case, the debtor may seek a judgment against the petitioning creditor or creditors for damages, punitive damages, costs and attorneys' fees pursuant to Code §303(i).

Voluntary cases can be filed under chapters 7, 9, 11, 12, 13, and 15. Involuntary cases can only be filed under chapters 7 and 11. Certain types of entities, such as banks and insurance companies, may not be eligible to file bankruptcy; however, almost all other entities can file a bankruptcy. Also, only a person, not a corporation, may file a chapter 13 bankruptcy. A chapter 13 bankruptcy is often called a “wage earners” bankruptcy and there are certain debt limits for secured and unsecured debts that may prevent your client from qualifying for this type of bankruptcy. Finally, a business that is a sole proprietorship and is not a separate entity from the debtor - such as a partnership, corporation or trust - cannot file a separate bankruptcy. A sole proprietor may list his real name in the bankruptcy filing and identify the business as an “aka”, “dba”, “fdba” or “fka”. The Law Offices of Michael H. Raichelson can advise you on what chapter to file under.

A CHAPTER 13 WILL STOP A FORECLOSURE

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A Chapter 13 may be used to stop foreclosure of your home. Before filing, you must have your ducks lined up.

First, foreclosures are conducted by a foreclosure trustee. Review the Notice of Trustee's Sale. The Notice should have a 1) trustee sale number; 2) the name of the trustee; and 3) the trustee's telephone number. Contact the trustee and obtain a fax number so that your attorney can send a letter via fax to the foreclosure trustee notifying the trustee of the bankruptcy filing.

Second, prior to filing bankruptcy, an on-line credit counseling course must be completed. Do this immediately.

Third, compile a list of your creditors and their addresses. Your attorney will pull a credit report for you; however, not all of your creditors are listed on the credit report. For instance, past due utilities or medical bills may not be listed on your credit report. Your attorney can compare your list to the credit report and add creditors to your creditor matrix if they are missing.

Fourth, contact your attorney as soon as you receive a notice of default or notice of trustee's sale. These documents trigger deadlines and your attorney should be familiar with those deadlines.

At the Law Offices of Michael H. Raichelson, we have helped hundreds of debtors who need to file bankruptcy. Call our Woodland Hills office for a free consultation.

SAVING YOUR HOME -- CHAPTER 7 VS. CHAPTER 13 BANKRUPTCY

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A chapter 7 bankruptcy will stop a home foreclosure on a temporary basis only. Eventually a debtor needs to do something else to keep the house in the long run if he/she is facing foreclosure.

When a bankruptcy is filed, the automatic stay is triggered under section 362 of the Bankruptcy Code. This prevents your creditors, including the home lender, from continuing collection efforts and seizing your property. However, a home is an asset usually secured by a deed of trust. The lender is entitled to apply to the court for relief from the automatic stay. Absent extraordinary circumstances, the lender's application to the court will be granted and the automatic stay will be lifted. Then, the lender may continue with the foreclosure process.

The debtor's home may be preserved under a chapter 13 bankruptcy if there is not substantial non-exempt equity in the home, and the debtor successfully completes his/her payment plan. Otherwise, the debtor's home may be preserved under a homestead exemption, if it applies. Also, the debtor's vehicle may be preserved if his/her payment plan is successfully completed and appropriate payments are made. If not, the car may be taken by creditors (unless arrangements are made to pay off the lien). All other non-exempt assets can be kept by the debtor if the payment plan is successfully completed. If the payment plan is not successfully completed, the non-exempt assets may be sold to pay creditors, as in Chapter 7 bankruptcy.

Hiring competent bankruptcy professional is the first step towards correctly evaluating what path is best for the debtor. Contact The Law Offices of Michael H. Raichelson to learn more.

SHOULD I FILE BANKRUPTCY?

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Should I file a Chapter 7 bankruptcy? That is the question most often asked by our clients. The answer depends on your assets, age, earning capacity, current earnings, physical health, and emotional well-being.

As a rule of thumb, if you cannot pay off all of your unsecured debt (i.e., credit cards, personal loans, judgments, etc.) within three to five years, you should seriously consider filing a Chapter 7 bankruptcy. The urgency to file a Chapter 7 bankruptcy is even greater the older you are in that the older you are, the less time you have to save for retirement.

Every year you spend making just the minimum payments on your credit cards is a year you can never get back, resulting in thousands of dollars in losses. Take the typical client that we will call "John Owe", who owes $30,000 in credit card debt. Let's assume that the average interest rate for all of John Owe's credit card debt is 20%. Under these circumstances, John Owe is paying $6,000 per year in pre-tax dollars in interest alone. In other words, he must earn from $7,000 to $9,000 before taxes to service just the $6,000 in interest on his debt. By eliminating this credit card debt in a Chapter 7 bankruptcy, John Owe is now in a position to save this money immediately.

If John Owe is 50 years old or older, he is better off depositing this $6,000 in an IRS qualified retirement account such as an IRA than paying interest on his credit card debt. The math is simple -- by the time John Owe is 65 years old, he will have saved $90,000 for retirement. This straightforward calculation does not consider the positive tax savings that would result from depositing his savings into an IRA -- contributions to an IRA come off his yearly income, thereby reducing his total tax liability. It also does not consider the potential return on investment that he is likely to receive when savings is put into a deposit account. If John Owe simply earns a 5% return on his investment and has an adjusted gross income of $40,000 per year, he would have $146,000 in the bank by the time he is 65 years old. If John Owe waits until he is 55 years old (i.e., delays just five years) before making his $6,000 annual contribution, he would have saved only $85,824, thus losing $60,176 for retirement!

No one is going to help you save for retirement, especially not the credit card companies. The math is clear -- filing a Chapter 7 bankruptcy turns a tax killer into a tax saver; delaying the filing will cost you tens of thousands of dollars.

To learn more about a Chapter 7 Bankruptcy, call the Law Offices of Michael H. Raichelson for a free consultation.

RE-ESTABLISH CREDIT AFTER A CHAPTER 7 BANKRUPTCY

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You can re-establish your credit after a chapter 7 bankruptcy. If you have a zero balance on a credit card at the time of filing, you may be able to keep it, subject to the creditor's discretion. If you reaffirm a car loan, and pay back the car loan consistent with the terms of the reaffirmation agreement, this may also re-establish your credit. Also, you can obtain a secured credit card linked to a savings account to re-establish your credit. To learn more about a chapter 7 bankruptcy, contact the Law Offices of Michael H. Raichelson. We offer a free meeting to evaluate your situation.

BANKRUPTCY REFORM -- CHAPTER 7 IS STILL AN OPTION

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The Bankruptcy Abuse and Consumer Protection Act "BAPCPA" was enacted into law in October of 2005. This act made numerous changes to bankruptcy law resulting in a belief among the general public that bankruptcy is not an option any longer. This is far from the truth. If you want to learn more, contact the Law Offices of Michael H. Raichelson located in Woodland Hills, California.

BAPCPA has changed the bankruptcy process and rules in many ways; however, bankruptcy exists and is a must for many individuals in today's downward economy.

Below is a list of some pertinent changes and documents needed in order to file for bankruptcy:

1. CREDIT COUNSELING: Each debtor must undergo credit counseling through an approved provider designated by the United States Trustee for the District within which one files for bankruptcy protection. Unfortunately, the providers charge a fee, typically $50.00 or less, which makes filing more expensive. This requirement is commonly referred to as "the ticket into bankruptcy." The course may be completed on-line and typically takes an hour or two to complete. Clients of our office receive an instruction sheet for completing this requirement with an attorney code allowing them to pay the provider through our office.

2. FINANCIAL MANAGEMENT: After the bankruptcy is filed, each debtor must undergo a financial management course, also known as debtor education, through an approved provider designated by the United States Trustee for the District within which one files for bankruptcy protection. Again, there is a fee for this service, typically $50.00 or less. This requirement is commonly referred to as the "ticket out of bankruptcy." The financial management course must be completed within a specified time period, 45 days after the first scheduled 341a meeting of creditors, in order for a debtor to receive a discharge. Again, our clients receive an instruction sheet for completing this requirement with an attorney code allowing them to pay the provider through our office.

3. PAYMENT ADVICES: Debtors are now required to provide 60 days of pay stubs or other form of income to file for bankruptcy. The 60 days of pay stubs begin 60 days preceeding the date the case is filed and must be filed with the Court.

4. TAX RETURNS: Additionally, a debtor is required to either file or provide the Trustee with a copy of the most recent filed tax return. Some jurisdictions, require the most recent two years of tax returns. The Central District of California only requires the most recently filed tax return.

5. The "MEANS TEST": BAPCPA created a new form, FORM 22, that must be completed and filed which incorporates a debtor's gross income for the 6 months prior to the filing date. The 6 month period ends on the last day of the month preceeding the date of filing for protection. The test utilizes numerous IRS guidelines in an attempt to determine if any abuse exists. We have performed the MEANS TEST thousands of times for current and potential clients and notify the client -- prior to filing -- if the MEANS TEST presents a problem. Our clients know prior to filing if they pass the MEANS TEST.

6. OTHER DOCUMENTS: Please note that additional documents may be required prior to or at the 341a meeting of creditors. They include Real Estate Valuations, Mortgage pay-off statements, copies of title to automobiles, to name a few. There may be additional requirements depending on your jurisdiction and local rules.

Contact Woodland Hills attorney Michael H. Raichelson for more information.

Attorneys Cannot Advise Clients To Take On New Debt.

2011-03-15T10:45:00.000-07:00

For background purposes, it was common practice for consumer bankrutpcy attorneys to advise potential clients to incur more secured debt, such as a new automobile lease or loan, in an effort to get them to qualify for a Chapter 7 bankruptcy. This new secured debt would reduce teh debtor's monthly disposible income to a point where they would be able to pass the "means test."

In the Milavetz case, the attorneys contended that, in providing legal advice and services to clients, the attorneys were not debt relief agencies and thus were not precluded from advising clients to incur more debt in contemplation of filing for bankruptcy. The attorneys argued that they were also not subject to the disclosure requirements applicable to debt relief agencies which curtailed the attorneys' freedom of speech. The U.S. Supreme Court unanimously held that the attorneys were debt relief agencies. In providing bankruptcy assistance, which was defined as including services commonly provided by attorneys, the attorneys were clearly within the definition of a debt relief agency, even though attorneys were not expressly included in such definition. Further, the attorneys were not precluded under 11 U.S.C.S. § 526(a)(4) from advising clients to incur more debt for valid purposes. However, they were precluded from providing such advice when contemplation of bankruptcy was the impelling reason for the advice.

The question now for consumer bankruptcy attorneys is what is a "valid purpose." Is it valid for an attorney to advise a client to purchase a new car to replace their 10 year old car with 100,000 miles on it prior to a bankruptcy because following the bankruptcy it will be difficult or impossible for several years for the debtor to obtain a new auto loan? If this new debt also helps the debtor qualify for a Chapter 7 bankruptcy under the "means test", is it now improper to advise the client to take on a new auto loan? We are sure that there will be more litigation in future years to sort out these questions.

Contact the Woodland Hills Office of the Law Offices of Michael H. Raichelson for a free meeting to discuss your bankruptcy options.

YOU CAN STILL FILE BANKRUPTCY IF YOUR SPOUSE IS INCAPACITATED.

2011-03-14T14:01:00.000-07:00

There is a little known procedure in the Bankruptcy Code that allows a "Next Friend" to file and prosecute a bankruptcy if his or her loved one is incapacitated and does not have any other estate planning devices available to file the bankruptcy.

For instance, if your loved one has Alzheimer's disease, is incompetent and cannot care for himself or herself, a chapter 7 bankruptcy petition may be filed by the loved one in his or her own capacity, as well as on behalf of his or her incapacitated spouse.

U.S.C. Bankruptcy Rule 1004.1 provides as follows:

"If an infant or incompetent person has a representative, including a general guardian, committee, conservator, or similar fiduciary, the representative may file a voluntary petition on behalf of the infant or incompetent person. An infant or incompetent person who does not have a duly appointed representative may file a voluntary petition by Next Friend or guardian ad litem. The court shall appoint a guardian ad litem for an infant or incompetent person who is a debtor and is not otherwise represented or shall make any other order to protect the infant or incompetent debtor."

11 USCS § 105(a) provides, in part, as follows: The court may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title.

The Bankruptcy Code provides the court with authority to make appropriate orders to protect a debtor as an incompetent by appointing a "Next Friend" of debtor. In In re Myers (2006, BC ND Ohio) 350 BR 760, the husband suffered from dementia. His wife of 63 years was appointed as Next Friend of husband pursuant to U.S.C. Bankruptcy Rule 1004.1 for the purpose of filing a bankruptcy petition on his behalf and taking all actions otherwise required by her husband as debtor because his wife was very knowledgeable about her husband's financial affairs, the wife at first meeting of creditors answered all questions concerning both debtors to the satisfaction of the Standing Chapter 13 Trustee, and no party, including the Chapter 13 Trustee, objected or responded to the motion for appointment.

Under this scenario, the wife may file a chapter 7 bankruptcy for herself and on behalf of her husband. The wife should obtain a declaration from a treating physician, and the debtors' attorney should file a motion to have the wife appointed as "Next Friend" of the debtor under the Bankruptcy Code. The wife should also be familiar with the couple's financial affairs, including all of their creditors and their income and expenses, and be prepared to testify regarding the couple's financial affairs at the Meeting of Creditors.

If no party objects and the court approves, the Motion should be granted and the spouse may continue prosecuting the chapter 7 bankruptcy to completion.

It is important to hire an experienced bankruptcy attorney. Contact the Law Offices of Michael H. Raichelson in Los Angeles for a free consultation.

Where to turn to get help with a consumer bankruptcy.

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This is a blog that the Law Offices of Michael H. Raichelson has created to help people who are thinking about filing bankruptcy. The Law Offices of Michael H. Raichelson help our clients gain control of their financial lives with the least amount of disruption possible. Call our office today at 818-444-7770 for a free consultation.