A recent court decision, In Re: Darosa, Jorge H. (Lawyers Weekly No. 04-107-10) (7 pages) (Hoffman, J.) (USBC) (Chapter 7 Case No. 10-44471-MSH) (Nov. 17, 2010), defines standards for the appraisals required to be filed for the debtor’s real estate. In this case, the bank seeking relief from the automatic stay initially relied upon the local tax assessment before presenting to the court a “Drive By Property Evaluation with Photos” performed by a local real estate agent. The judge allowed the bank’s motion based on the latter evidence, and made this cautionary note about appraisals filed “A homeowner with no technical skill beyond the ability to surf the web can log into Zillow and add or subtract data that will change the value of his property. This of course makes Zillow inherently unreliable.” If the debtor is going to keep their home, an actual appraisal is not mandatory, but at least a comparable market analysis done by a qualified professional is necessary. Therefore, to answer the question, a Zillow evaluation cannot be used.
April 6th, 2011 by Administrator
If the entity, person or business, who is the creditor owed money in a bankruptcy case is not listed on the initial petition, the list of creditors should be amended as soon as possible in order to include their information as a creditor receiving notice. If this is not done, the underlying debt might be discharged but not as to that particular creditor. Such a motion to amend may be made before the case is closed by the court, even after an order of discharge has been received. If a case has been closed, it would have to reopened in order to amend the initial petition.
March 2nd, 2011 by Administrator
A Chapter 7 bankruptcy is a legal liquidation of non-exempt assets, so debtors in such cases want to be able to keep as much of their property as possible. State laws generally allow a generous exemption amount for a homestead in the debtor’s personal residence, while federal law generally allows liberal exemptions for other personal property items. However, these different exemptions must be used consistently throughout the petition. A debtor has to pick which to use, state or federal law. Mixing the exemptions allowed by two systems in order to achieve maximum protection for the debtor’s case is absolutely prohibited.
March 2nd, 2011 by Administrator
Persons contemplating bankruptcy can enter into a car loan without worrying about losing the new car in their bankruptcy. As long as the money they have put down is within the exemption allowed under the appropriate law, they would be allowed to keep the car and continue regular payments if such payments are affordable within their means given their income and other expenses. They should be allowed to reaffirm this debt and keep it outside of their bankruptcy, while discharging the debts they need to.
March 2nd, 2011 by Administrator
Fees that are owed to an attorney acting as a guardian ad litem (GAL) in a divorce case are to be distinguished from other types of attorney fees, which are generally dischargeable in a Chapter 7 bankruptcy case. The recent case In Re: Gove, Thomas E., Jr., (Lawyers Weekly No. 04-003-11) (21 pages) (Feeney, J.) (USBC) (Chapter 7 case No. 09-22405-JNF; Adv. P. No. 10-1048) (Jan. 13, 2011) found that where such GAL fees had been incurred for a pre-petition divorce proceeding, such fees were the equivalent of other court-ordered support payments. According to the court, “[Thomas E.] Gove [Jr.]‘s obligation to pay GAL fees to O’Brine meets the definition of a domestic support obligation under 11 U.S.C. s.101(14A) and is, therefore, a nondischargeable debt under 11 U.S.C. s.523(a)(5). …”
February 21st, 2011 by Administrator
The easiest way for someone with a debt to buy themselves time and avoid a possible wage garnishment is to answer a lawsuit complaint they are served with. Even if they are not completely ready to defend against the lawsuit, answering the complaint would prevent the company suing them from immediately obtaining a default judgment. The company would have to obtain its judgment by motion after a hearing. Once a company has a default judgment, they can request an execution, which can be used to place a lien on any real estate their account holder has. The company’s next step would be to start a supplementary process action to collect on the judgment and thereby obtain a court order for wage garnishment.
February 21st, 2011 by Administrator
There is good news for people contemplating bankruptcy who own and wish to keep the home where they live. For thirty-five (35) years, Massachusetts state law has allowed an individual a $700 exemption for their motor vehicle. This exemption is used for homeowners, whose equity interest in their residence is protected by the state’s homestead exemption. Unfortunately, most vehicles are worth more than this, leaving such debtors with unexempt value in their cars. The “auto exemption bill” signed by Gov. Deval L. Patrick on Jan. 7 raises this amount to $7,500, even a greater amount than that allowed under federal law.
February 16th, 2011 by Administrator
A recent article, illustrates the importance of people keeping good records of their accounts. The statute of limitations to pursue a claim for a debt owed runs from the time that debt is “charged off” by the creditor, meaning the account is no longer considered to have active status. Creditors who do not pursue claims after the running of the statute of limitations might hope that their unaware former account holders will pay off outstanding debts if they are financially better off. These creditors cannot in fact collect on these debts.
February 16th, 2011 by Administrator
The credit counseling course certificate gets filed along with the bankruptcy petition, so debtors must complete this requirement at the time of their filing. Often, debtors begin the bankruptcy process and finish this requirement, but are waiting to get remaining items together before filing their case. Such persons should be aware that the course certificate is valid for the court’s purposes for one hundred and eighty (180) days, or approximately six months, in order for them to use the certificate for their bankruptcy filing.
January 24th, 2011 by Administrator
Bankruptcy debtors can keep their residence if they can afford their mortgage payments, and perhaps try for a modification based on their hardship. However, these bankruptcy filers should be aware that there may be hidden costs in doing so. For example, while the mortgage bank cannot use the fact that an applicant filed bankruptcy to deny a mortgage modification, an insurance company can base their approval upon the applicant’s credit score. Property or liability insurance coverage may then be denied even to someone who can otherwise afford to stay where they are.
January 24th, 2011 by Administrator
