Avoiding Paying Prior Employee Debt
If you prefer NOT to pay back present or prior employee debt, bankruptcy can help you use the law to prevent it from being a priority debt.
Priority Debts in No-Asset Cases
Priority debts are largely unaffected by a Chapter 7 case--it does not discharge them, so you need to pay them after finishing your case.
Priority Debts in an Asset Chapter 7 Case
Your Chapter 7 trustee may pay your priority debts--in full or in par--through the proceeds of the sale of your unprotected, not exempt assets.
Chapter 13 Gives the Most Time to Cure Your Mortgage
Chapter 7 provides no mechanism to cure your mortgage. But Chapter 13 does provide a powerful, realistic, and practical way to do so.
Protecting Your Home Equity through Chapter 7
You can protect the equity in your home if the amount of equity is no more than the homestead exemption applicable to residents of your state.
An Example of a “Preference”
A "preference" makes more sense when you see an example. Here's one. This also helps explain how to avoid creating one.
If you pay on or pay off certain debts it may create a preferential payment
Do you feel like you should pay on or pay off a certain debt now, even though you're behind on all your debts? It may be dangerous to do so.
Fraudulent Transfers Around the Holidays
Giving a gift, including selling for much less than an asset is worth, may be a fraudulent transfer--treated as hiding assets from creditors.
An Example Why Passing the Means Test May Be Easier in 2018
Filing bankruptcy before the end of December may help you qualify for Chapter 7 bankruptcy. Here's an example showing how this could work.
Successfully Completing a Chapter 13 Case
A Chapter 13 case lasts a long time, but can have many advantages. Many of those advantages come only if you successfully finish it.
The Means Test is Based on Timing
Most people easily pass the means test based on their relatively low income. Timing plays a huge role in calculating your income.
Timing: Avoiding “Fraudulent Transfers”
Giving a gift, or selling for less than true value, can cause problems when done before bankruptcy, but usually only if the amount is large.
A Sample Completed Chapter 7 Case
What does the completion of a successful Chapter 7 "straight bankruptcy" case look like? What happens to your debts?
Protecting Your Co-Signer in Bankruptcy
Don't be afraid to file bankruptcy because of how it would affect a co-signer. Your bankruptcy often actually helps that co-signer.
The Chapter 13 Plan
Chapter 13 revolves around your payment plan, which you propose based on your budget, and possibly negotiate with creditors and the trustee.