Riverside County Bankruptcy Lawyer Blog

Many people are under the mistaken belief that you can only keep one car in bankruptcy. While the bankruptcy code in California only give you an exemption for one car at $3550 this does not mean that you can only keep one car. I have had clients with 8 cars that have filed chapter 7 and kept them all. Because california has a wildcard exemption for 23,500 its not a question of how many cars but how much value in your cars that you can exempt. Many people have financed cars with no equity in them as they owe the banks more than the cars are worth. Under that analysis you can have as many cars as you have financed as its of no value to the estate since its your equity position in the car that the trustee cares about and not the cars that are overly financed. The wildcard exemption can be pieced and parceled however you like so if you have a car worth 10k we would use the 3500 for the car exemption and the 6500 for a wildcard exemption which would still leave 17k on the wildcard. We could then exempt 2000 dollars that you have in the bank which would leave 15k on the wild card. You could have 5 cars worth 3k a piece and then that would use all the exemption amount. So you can see by my examples its not a matter of how many cars but what the values are and if we can protect everything with the wild card exemption as well as the car exemption. Call my office if you have further questions as to what you can keep in bankruptcy.

When doing google searches about Palm Springs Bankruptcy attorney's I seem to find more and more attorneys who are paying to advertise via the web in Palm Springs regarding bankruptcy service but do not live or practice in Palm Springs. Many of these law firms use virtual offices and have a paralegal show up once a week to do the intake process. I don't have any issues about taking cases out of town and actually do practice in all four federal districts doing chapter 7's in all four but 13's only in the Northern and central District, but I do recommend that if you are going to hire an attorney for something as intimate and potentially consequential as bankruptcy that you are dealing with an attorney and not a mass marketing mill that strives to take your money with little consequence to what happens with your case. Many attorney need paralegals to do the day to day work such as correspondence, drafting letters, filing cases, entering data etc. I have heard more and more from clients who have gotten their cases dismissed that there was a lack of communication between the paralegals and the attorney managing their cases which sometimes has gotten their case dismissed. I have had at least 3 cases in the last month from people in palm springs who have filed bankruptcy with attorneys who are an hour or more drive and have had communication break downs which lead to case dismissals and in one case a house which was sold at auction because an attorney didn't file an response for a motion for relief from automatic stay. Make sure that whoever you decide to use in your bankruptcy that they have your best interest at hand. There is some money to be made in bankruptcy these days with as many cases as we are seeing, but my belief is that if you want to make this a lasting practice you have to take a very individual approach with each client which I strive to do, even as I get busier. Call my office at 760-459-2438 and you will speak with me directly. I live and work in Palm Springs and plan on staying in bankruptcy for the long haul and you will see that in my personal service and attentiveness that I take on your case. Although we will get out of this recession and tough economic times, there will always be failed businesses, divorce, medical issues and the standard things that cause people to file bankruptcy. The mills will fade and the sole practitioner who is serious about bankruptcy will rise to the top and that is how I am building my practice.

The general rule in bankruptcy is that the most recent tax return needs to be turned into the trustee one week before the 341 hearings. Failing to do so can get your case dismissed or if you are lucky the trustee will give you a few days to do it and continue your case. If you comply with the tax return requirement then they will remove the continued date off calender and everything moves forward to you getting a discharge. That is if you file your 2nd credit counseling class along with the B23 certificate where you swear that you took the class and put the certificate number etc. These are some of the things that pro se(clients that represent themselves) forget to do and end up getting their cases dismissed. Looking up the local rules on the bankruptcy court website can help but the more prudent aproach in my opinion is to hire someone to do it for you. As a riverside county bankruptcy attorney I do this every day and make sure that everything is done correctly. Today I was in court for 3 cases and one one of them my client gave me a declaration that they were not required to file tax returns for the previous two years because they made under the 9k IRS limit which allow you to not file. I have dealt with this before with clients just making social security income or low income enough to not file. What I have typically done is just file a declaration claiming them exempt from returns. Today the trustee told me that I was in his opinion still required to mail the most recently filed return which was for 2008. I will do that tomorrow and the case will move forward smoothly. Even a seasoned practitioner can be challenged and he might be right. I find it hard to believe that the trustee would be interested in the income my client made three years ago as its irrelevant to the current bankruptcy case but if that is what he wants then I'll be faxing that to this office tomorrow. Typically I have my clients file tax returns before we file. I might go back to that.

The actual costs to file bankruptcy in Riverside County or anywhere for that matter is $299 for a chapter 7 and $274 for a chapter 13. There are also two classes that are now required by the bankruptcy code and some providers charge up to $50 dollars but I have found two that are reasonable and that you can do for $5 and $15 for the second class. I charge people $30 for an individual and 50 for a joint couple to pull their credit reports which then downloads all creditors into my software. Essentially then for me there are $350 dollars in fees that go out of my pocket to file a case on behalf of my clients. Most bankruptcy attorneys start the fees at $1500 for a chapter 7 and that is just for attorney fees so many are $1850 or more in order to file. I try to start around $1200 for a basic case but if its really simple and not a lot of assets to protect, financing on cars, saving a house from foreclosure etc then I've been known to charge $1000 dollars. A typical case for me is 12-15 hours of work and then I have my own cost of running a business so I'm about as reasonable as they come for a qualified bankruptcy attorney. I do all the work myself occasionally using virtual paralegals for data entry and gathering of documents when I get too busy, but I pride myself on having a personal relationship with my clients throughout the whole process. I see the type of work that the bankruptcy mills churn out and they charge as much as I do and there clients only meet there attorney for 30 minutes and then show up at the hearing. Bankruptcy work needs someone that you feel comfortable with and that answers the right questions and best protects you to help you move forward with your fresh start. I vary my prices on a sliding scale and understand what people are going through in this economy and what a personal decision this is so please call my office to find out what chapter to file or if bankruptcy is right for you.

If you are in receipt of a letter from the sheriff's office or have received a letter of intent for a wage garnishment from your employer or HR person, then the clock is ticking and bankruptcy is likely the best option. Wage garnishments have the ability to collect 25% of your wages. There have been very few bankruptcy cases that I have ever seen where the trustee payments are as high as the amount that my clients lose in wage garnishments. Sometimes if your income is below the median income then a chapter 7 can stop the garnishment and you'll pay nothing back to your creditors. If you are in a high income bracket then you'll possibly have to do a chapter 13 and pay back whatever your disposable monthly income is to creditors. We take all your reasonable and allowable expenses and see what is left over. Even or people that are making 100,000 dollars or more a year I typically get a plan payment of less than 1000 dollars a month where as with that kind of income a wage garnishment would be taking out 2000 dollars or more. Bankruptcy also offers a lot of other benefits such as the ability to strip liens, cram down financed cars to the current market value. So don't let a wage garnishment stop you in your tracks, bankruptcy can be a fluid way to reorganize and it will come with some serious benefits and get your financial life back on track and improve your credit score quicker then letting the judgments continue to come in.

More and more of my Bankruptcy clients are being sued by The Law offices of Patenaude and Felix. They are based in San Diego and have many California lawyers who sue on credit card debt. If you have been served a summons or are being sued or looking at a default judgment from this law firm then we should look at bankruptcy as a potential option or possibly trying to settle the debt if you can come up with a lump sum payment. Default judgments will allow them to collect 25% of your net income through a wage garnishment and for most people even who make a lot of money a chapter 13 plan will be much less on a monthly basis then the loss of 25% of your wages. If you are below the median income you can do a chapter 7 bankruptcy and most likely keep all your assets. Call my office to find a solution to your legal problems with Patenaude and Felix.

HELOC's or Home Equity Lines of Credit were pretty popular during the boom years and I'd put a good bet are a thing of the past for near distant future. Riverside County has lost 8 years of value in homes. I've seen many homes that are worth 50% of what is owed on a 1st mortgage. Homes that are underwater to the point that you owe more to the first then the home is worth are eligible for lien strips in Chapter 13 bankruptcy. This has been enticing enough for some clients that I have that even though their unsecured credit is minimal and typically would not fit a profile that had bankruptcy in their future, have led them to seek bankruptcy relief as a form of restructuring their mortgage. The amount of loan modifications that are being denied and peoples desire to get out of bad housing deals make bring them to the steps of the bankruptcy court. If you are in this position call a riverside bankruptcy attorney to discuss your options.

Chapter 13 bankruptcies are twice the usual amount on a monthly basis in Riverside County. I filed 3 Chapter 13's last month and was amazed at how slow the trustee's were to responding to issues in my cases. When I inquired I was told that filings are around 1000 for the month of December as opposed to the typical 500 that their office reviews. I don't know if higher income people are needing to file or more people are being enticed with the potential for discharging 2nd mortgages and HELOC loans. I know 2 of the cases that I filed the clients qualified for Chapter 7 but chose to do a 13 because of a 50k dollar HELOC loan that we could discharge through the bankruptcy with the making of minimal payments over 3 years. The chapter 13 trustees while busy are still extremely persistent in examining the cases that I have sent over. They even went to the point of calculating my clients commute mileage when I put in an expense of 650 dollars for transportation costs. They thought that 550 was more reasonable based on their commutes. I hadn't even calculated commutes and took my clients at face value and don't know costs for oil changes etc which all get wrapped up in that expense. Even with the magnifying looking eye of the Chapter 13 office for many people it is the best way to go if your house is really upside down and you want to keep it. Either paying back arrearages or getting rid of 2nd homes makes Chapter 13 a better advantage to a 7 for some clients

Bankruptcy Petition preparers are cheap but don't add value to your case.

Be wary of all the advertisments for $200 dollar bankruptcies. While a petition preparer can offer typing services and help put your assets and debts in the right places, and maybe help determine your six months of income necessary to do the means test. They cannot offer legal advise or help you with exemptions. Read this article before turning to a low cost petition preparer. As an attorney I see bankruptcy cases every day and see how the trustee's look at issues and understand how to protect all your assets and make sure that everything is included so that you get your discharge and not your case dismissed.

Failure to mention a potential asset such as an unresolved personal injury case or employment law case can make it where its subject to the trustee and property of the estate instead of exempt and yours to enjoy and protect.
Bankruptcy petition preparers can only charge $200 dollars and charging more is a crime. There are many warning signs in all the trustee meeting rooms and any money above that charged by these preparers is disgorged by the trustee for the benefit of the estate. Talk to a riverside bankruptcy attorney to know your rights and protect your assets

Filing for bankruptcy is never an easy decision but if things are starting to get better for you economically but you are still mired in debt then there is no time like the present to get bankruptcy advice from a riverside county bankruptcy attorney. The type of bankruptcy you qualify for depends on your last six months of income and once things start getting better if getting out of previous debt is still a priority, its likely you'll be in a five year plan and subject to a restricted budget. Chapter 13 offers many benefits but its nice to be able to make the decision to choose between a chapter 7 or chapter 13 and by waiting until your income goes back up, it might be a choice you won't have.

Cramming down a car in a chapter 13 is a great way to save money and also reduce your disposable monthly income so that you have a cheaper plan payment. If your car is more than 910 days from when you financed it, then you can pay what the car is currently worth on kelly's blue book or your opinion based on damage etc. Chapter 13 will allow you to pay it off over 5 years instead of the time that you have left which can really lower your payments. It will also help you with reducing disposable monthly income because if you have a financed car then you get a deduction of 496 dollars minus what your car payment is divided over 60 months or 36 months if you are below the median income for your family size. If you own your car outright the ownership expense is much less so it actually helps to keep a financed car through a chapter 13. Chapter 7 allows you to keep your car and continue to make finance payments but you can't bring it down to current market value.

Foreclosures will slow down throughout Country with recent developments but not so fast for California homeowners.

While news of foreclosures slowing down based on banks and lawyers questionable methods is great news it won't be helping Califonia homeowners as much as other states. California has non-judicial foreclosure which means that within a deed of trust there is typically a power of sale cause. After a notice of default, the owner of the property(bank) will typically sell the property at a trustee notice of sale which gives the borrower 21 days. At a trustee sale, the lender will typically bid the amount that is due plus costs if there is not a bidder. The borrower has no right of redemption and deficiency judgments maybe purused in non-judicial foreclosure. That essentially means that the lender can sue you for their loss on the property and you could get a 1099C for their loss which can sometimes have the effect of making you accountable for their loss as income for tax purposes in the following year.

The issue the banks are facing on judicial foreclosures are that people are signing afffadavits about documents that they are not familiar with and have not reviewed. The affadavits say certain facts about the case including what is owed which signer says he has personal knowledge of. They are doing this to the tune of 10,000 affadavits a month which they could clearly not have personally reviewed in order to get a summary judgment and avoid going to trial which is more expensive. They tried to streamline the machine of foreclosures and in the midst they perverted the justice system. The banks in their carelessness have shown. Foreclosure attorneys have been questioning the standing of MERS(mortgage Electronic recording system) for years and have had some success so this ruling by judges who have timely questioned banks foreclosure processes which will help homeowners. As a bankruptcy attorney it will likely not allow me to delay filing petitions so I can keep home owners in their homes longer because the trustee sales will go an as usual since lenders almost always foreclose outside of the judicial system. Many people who live in their homes for free while the bank drudges through the foreclosure process are able to put their financial houses back in order. For states with judicial foreclosure this will be a relief for homeowners who try to rebuild their savings and move on with their lives after falling off a cliff with the loss in equity that their homes went through.

Personal bankruptcy rose 9% in July according to the Wall Street Journal. That is a anumber of close to 138,000 in one month leading me to believe that 2010 will be the highest number of filings in five years. 2009 saw 1.4 million people file and we are already at 900,000 for 2010. For people who have had the credit rating reduced and are having a hard time finding a credit source, bankruptcy becomes one of the only ways to get out of a financial mess. The 2005 bankruptcy changes have had little impact in terms of reducing the number of filings. The main purpose was to force people into chapter 13 but creating the means test and the % of chapter 13's have not drasstically changed and many people still qualify for chapter 7 relief.

California has almost jumped 30% in the nmber of filings as opposed to a year ago. With Riverside County having 15% unemployment I don't see the trend stopping any time soon. One out of every 125 households has filed for bankruptcy protection in the last year. It is beoming apparantly obvious that bankruptcy has lost some of the stigma that was traditionally associated with it. My opinion is that it inevitably becomes a stimulous to the economy since consumers get to spend again instead of putting all there money into interest fees that have skyrocketed even while banks are borrowing money at less than 1%. 70% of our economy is based on consumer spending and sometimes being able to walk away from deficiency judgments and potential wage garnishments is better than contributing to bank profits when the banks are failing to put that money back into our communities. If you are paying to much in interest rates or are facing foreclosure or other financial problems, talk to a California Bankruptcy attorney who practices in all the federal districts.

Everyday I have clients that wonder whether they should continue to make payments on a home that has lost so much value. I think you need to consider whether you are in an interest only loan and the payments will reset to something that is not affordable. The other consideration I take into account are what the prices for a rental would be and if its similar then potentially staying in your home is a better bet depending on how far behind on your mortgage or upside down you are and therefore the length of time it will take to build equity. As a bankruptcy attorney I believe it is imperative to go over all options with a client and let them make a informed decision.

Chapter 13 has some powerful aspects that can really help people with financed vehicles. In a chapter 13 if you owe more on your vehicle than the current market value(blue book) then we can restructure your financing so that you pay on what the car is actually worth. This only works if the financing is more than 2.5 years old so you can't buy a new car and walk off the lot and get it crammed down, but it works for a lot of people and can save you quite a bit of money.

I have had clients that have been able to fund a chapter 13 plan just in the savings that they made by cramming down their car. If you owe 20k on a car and its only worth 10k then just the money you save in financing would give you 200 a month to fund a chapter 13 plan.

Although Chapter 7 can be a faster way to get debt free, a chapter 13 with its cram downs and lien strips on real property can be a valuable way to put yourself in a great position to come out ahead when your chapter 13 debts are discharged.