Bankruptcy Law

Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.

Ask a Lawyer,
Get an Answer ASAP!

Bankruptcy Law
This answer was rated:

I am trying to determine whether Chapter 13 Bankruptcy is right

for us. I am currently...
I am trying to determine whether Chapter 13 Bankruptcy is right for us. I am currently employed as an adjunct college instructor making varying income between $600 and $1800 monthly - I have been unable to find steady full time work since completing my doctoral degree. My wife makes $1450 every two weeks before 401K loans, benefits and taxes. We have a $14,000 high interest secured loan (which we are current on, barely) secured by a car and about the same amount in credit cards and unsecured debts that have gone into collections, and we are not able to pay on those. No judgments or garnishments yet, but I am expecting it. We have been nearly 90 days past due on our mortgages for some time, and have avoided foreclosure with very painful 401K hardship withdrawals. We have a complicated situation related to home mortgages. When we refinanced our mortgage in 2009 the original mortgage kept the HELOC open and extended full credit on it. We ended up charging 128,000 on that HELOC in addition to the 180,000 we owe on the house. In 2010 the line was locked. We now pay $600 monthly interest only payments on the HELOC and $1350 monthly on the first mortgage. That stands to go up if and when interest rates do. During a collections call shortly after they locked the HELOC, I discovered that the HELOC lender believes themselves to have first position on the house, which they do not. My wife is very concerned that if we try to file bankruptcy or do a modification, they may end up calling in the loan entirely because they should never have loaned us the money. So we end up continuing payments we can’t afford and we've let so much else go. I have no real opportunities for full time work in the near future and am afraid we've slid to the point that we can't go any further without catastrophe and would like to explore the Chapter 13 option IF we can qualify and if we can do it without triggering a financial disaster. My wife works in banking and is concerned that the filing may impact her status at work also. She is especially concerned about the situation with the HELOC. Any guidance would be appreciated.
Show More
Show Less
Ask Your Own Bankruptcy Law Question
Answered in 31 minutes by:
5/6/2013
Roger
Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 31,797
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
Verified
Hi - my name is XXXXX XXXXX I'm a Bankruptcy litigation attorney. Thanks for your question.

The biggest problem may be that MOST banking institutions will not allow an employee to continue working if he/she files for bankruptcy. There is no law on this issue, but that's the policy that most all banks have -- so that may be what prohibits you from filing. She should check on that before doing anything.

As for chapter 13, the basic rule is that you must have enough income to sustain a repayment plan - - in other words, there must be proof that there's a cash flow to sustain payments. The good thing about a chapter 13 is that you get to keep all of your property, but the bad news is that you have to repay all of the money - - so you don't get a break in that regard.

However, under a chapter 13, you can reduce your monthly payment amounts by extending the terms of all loans. Also, you can remedy the default on your mortgage loans by repaying the debts over time. Here's a good link that outlines the chapter 13 process: https://www.google.com/search?q=chapter+13+bankruptcy&ie=UTF-8&oe=UTF-8&hl=en&client=safari

If you can file a chapter 13, it is the best option of all of the bankruptcy filings.
Ask Your Own Bankruptcy Law Question
Customer reply replied 4 years ago

OK so say that is the case and she cannot file .... how do you think our HELOC situation could impact her work if we address it? I mean, if I decide to pursue modification, which both lenders offer all the time, and the HELOC lender does a title search and sees they are not on the title in any position (which I believe is the case) could they call in the whole loan? If they do, what is the potential impact? This one issue is the key major source of stress in our lives and I need to figure out how to address it. If not bankruptcy, then what do we do? We owe $300,000 altogether but the property is only valued at $140,000.

 

And by the way, we did not know that the other bank didn't mean to continue to extend credit. It seemed like they should have closed out the HELOC when we refinanced, but they just kept sending us checks, debit cards and letter imploring us to borrow money.

The lien status or lien priority of the HELOC loan will not affect your loan as that's a mistake of your lender and they can't call the loan because of that. HOWEVER, the lender can call the loan IF you are in default. Certainly, if the lien rights are not what the bank thought it was, that could impact whether or not the lender agrees to the loan modification.

I can't say how the lender would view this, but I would really doubt that the lender is wrong about it's lien rights and secured status. It does happen, but it's rare, so there may not be an issue with that.

In any event, if bankruptcy isn't filed, the only other option is to go for the loan modification. If that doesn't work out, there are no other relief options - - you would be facing having to pay off the debt OR the foreclosure would likely ensue at some point.

Roger
Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 31,797
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
Verified
Roger and 87 other Bankruptcy Law Specialists are ready to help you
Ask your own question now
Customer reply replied 4 years ago

Thank you!

Ask Roger Your Own Question
Roger
Roger
Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 31,797
31,797 Satisfied Customers
Experience: BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters

Roger is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

Mr. Kaplun clearly had an exceptional understanding of the issue and was able to explain it concisely. I would recommend JustAnswer to anyone. Great service that lives up to its promises!

Gary B.Edmond, OK

My Expert was fast and seemed to have the answer to my taser question at the tips of her fingers. Communication was excellent. I left feeling confident in her answer.

EricRedwood City, CA

I am very pleased with JustAnswer as a place to go for divorce or criminal law knowledge and insight.

MichaelWichita, KS

PaulMJD helped me with questions I had regarding an urgent legal matter. His answers were excellent.

Three H.Houston, TX

Anne was extremely helpful. Her information put me in the right direction for action that kept me legal, possible saving me a ton of money in the future. Thank you again, Anne!!

ElaineAtlanta, GA

It worked great. I had the facts and I presented them to my ex-landlord and she folded and returned my deposit. The 50 bucks I spent with you solved my problem.

TonyApopka, FL

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

< Previous | Next >

Meet the Experts:

Terry L.

Terry L.

Attorney

2,672 satisfied customers

Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.

cortrightlaw

cortrightlaw

Attorney

511 satisfied customers

Attorney practicing Bankruptcy Law including Chapter 7, Chapter 11, Chapter 12, and Chapter 13.

JoeLawyer

JoeLawyer

Attorney

376 satisfied customers

Attorney in the practice of Bankruptcy Law since 1996

A.J.

A.J.

Attorney

262 satisfied customers

Experienced consumer bankruptcy attorney.

Fritz

Fritz

Attorney

209 satisfied customers

Florida attorney with extensive experience in Chapter 7 and Chapter 13 consumer bankruptcy cases

Law Girl

Law Girl

Attorney

153 satisfied customers

I am an attorney.

Paul K, Esq.

Paul K, Esq.

Attorney

141 satisfied customers

10 years Exp., Great customer service, Prompt responses.

< Previous | Next >

Related Bankruptcy Law Questions
I live in Texas and am in the second year of my CH 13
I live in Texas and am in the second year of my CH 13 bankruptcy. I remarried after my filing and my wife is the sole owner of our home (She had it before we were married and it is mortgage-free). She… read more
Legal Expert Justin
Legal Expert Justin
Law Degree
200 satisfied customers
I am filing chapter 13 and have a car loan for $10,750 with
I am filing chapter 13 and have a car loan for $10,750 with the Credit Union There was no title so no lien card as the car was 1956 I had an emergent need to pay a medical bill and to spent the $11,00… read more
Legal Expert Justin
Legal Expert Justin
Law Degree
200 satisfied customers
I (co-borrower) am in both Hardship Loan Modification and
I (co-borrower) am in both Hardship Loan Modification and Underwriting and CHASE also filed foreclosure proceedings that are at the end of negotiations and almost granted. I have had terrible injuries… read more
INFOLAWYER
INFOLAWYER
Partner
Doctoral Degree
55,474 satisfied customers
If a debtor is subject to a wage garnishment and the wages
If a debtor is subject to a wage garnishment and the wages are garnished at the employer level, what happens to the non-garnished wages? Can the creditor now just go to the bank and get the 75% of the… read more
Barrister
Barrister
Attorney/Landlord/Realtor
Doctoral Degree
34,659 satisfied customers
Second opinion] Texas Bankruptcy Attorney?What happens to a
Second opinion] Texas Bankruptcy Attorney?What happens to a Chapter 13 plan after Judge has signed the approval for loan modification? Will it convert to a Chapter 7?… read more
Terry L.
Terry L.
Attorney
Doctoral Degree
2,672 satisfied customers
Capital One is going to garnishment my checking. I have two
Hi Capital One is going to garnishment my checking. I have two business account. one is a sole proprietorship. The other is LLC I was told they couldn't garnish a LLC. I just talk to some one at the b… read more
INFOLAWYER
INFOLAWYER
Partner
Doctoral Degree
55,474 satisfied customers
I am a chapter 13 and attempting to get a loan modification
I am a chapter 13 and attempting to get a loan modification on property and have been in contact with whom I thought was my loan mortgage aka servicing company. I have been paying them for years- now … read more
socrateaser
socrateaser
1,031 satisfied customers
I have a nonperiodic garnishment for a credit card I did not
I have a nonperiodic garnishment for a credit card I did not pay or go to court. My car is paid off but the credit union has never sent me my title free and clear. I get social security disability. Ca… read more
socrateaser
socrateaser
1,031 satisfied customers
I have a lien in my student loan, can they also garnish my
I have a lien in my student loan, can they also garnish my paycheck? How should I deal with the lender?… read more
Phillips Esq.
Phillips Esq.
Attorney
Juris Doctor
17,996 satisfied customers
I just received a notification that a creditor is garnishing
hello. I just received a notification that a creditor is garnishing my wages starting next month. I work for the school district. What can I do. Im ready to file bankruptcy if i have to. so 2 question… read more
Barrister
Barrister
Attorney/Landlord/Realtor
Doctoral Degree
34,659 satisfied customers
If a judgement creditor in Utah wants to garnish a bank
If a judgement creditor in Utah wants to garnish a bank account does the bank need to be in Utah, or can they garnish a bank account in another state?… read more
INFOLAWYER
INFOLAWYER
Partner
Doctoral Degree
55,474 satisfied customers
Not really bankrupcy but i have received a garnishment
not really bankrupcy but i have received a garnishment judgement from statefarm ins co, which to my understanding may due to a car loan default and reposession of the vehicle … read more
Terry L.
Terry L.
Attorney
Doctoral Degree
2,672 satisfied customers
21 November 2016 05:31 New Question: The Garnished wages
21 November 2016 05:31 New Question: The Garnished wages were not included on Schedule C. Can the Debtor Amend Schedule C to include the Wages? What other Schedule needs amending; and what is the prop… read more
Law Tutor, Esq.
Law Tutor, Esq.
Lawyer
Doctoral Degree
165 satisfied customers
BANKRUPTCY: Chapter 7 Pro Se Debtor had a Garnishment that
BANKRUPTCY: Chapter 7 Pro Se Debtor had a Garnishment that was stayed by bankruptcy. Debtor was advised to contact the Creditor's Attorney for Refund of garnished wages. Creditor's Attorney is uncoope… read more
Law Tutor, Esq.
Law Tutor, Esq.
Lawyer
Doctoral Degree
165 satisfied customers
I have a $40,000 garnishment just coming into play, although
I have a $40,000 garnishment just coming into play, although it dates back many years. At lease $20,000 is interest, and the interest is accumulating at 12%. These lovely people bought up debt during … read more
Ray
Ray
Lawyer
Doctoral Degree
30,244 satisfied customers
I had funds garnished from my bank account by the attorney
I had funds garnished from my bank account by the attorney of a creditor. I completed a writ of exemption and the other attorney appealed it and now we have a court date. Do I have a chance of getting… read more
Phillips Esq.
Phillips Esq.
Attorney
Juris Doctor
17,996 satisfied customers
If a creditor garnished or seized a bank account from a
If a creditor garnished or seized a bank account from a judgment lien from an old apartment debt and in the process bankruptcy was filed. When the debt is discharged will those monies be returned to t… read more
Roger
Roger
Attorney
31,797 satisfied customers
I had a garnishment placed in my check for 1996 dollars and
I had a garnishment placed in my check for 1996 dollars and some odd cents. My employer didn't start paying it right away because I had an additional garnishment on my paycheck. The judgement was in o… read more
Legalease
Legalease
Attorney At Law
Doctor of Law w/ highest honors
15,669 satisfied customers

DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.

The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).

Show MoreShow Less

Ask Your Question

x