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Common Questions When One Spouse Files Bankruptcy

The Scottsdale bankruptcy attorneys at Canterbury Law Group represent debtors, creditors, trustees and committees in both personal and commercial bankruptcies. Bankruptcy law provides for the reduction or elimination of certain debts, and can provide a timeline for the repayment of non-dischargeable debts. It also permits individuals and organizations to repay secured debts with more favorable terms to the borrower.

The Phoenix bankruptcy lawyers at Canterbury represent many clients through personal bankruptcy cases. If you’re married and considering filing bankruptcy, here are common questions that often arise:

1. Do I Have to File Bankruptcy with My Spouse? If only one partner in a marriage owes debt, then only that partner should file for bankruptcy. Debts where spouses are jointly and severally liable for payment will remain with the spouse who has not filed for bankruptcy. However, in states that follow community property law, single spouse bankruptcy for joint debts may in some situations be advantageous.

2. Can I File for Bankruptcy without My Spouse’s Knowledge? Legally and in theory, yes, it would be possible for one spouse to file for bankruptcy without the other partner ever finding out. However, Chapter 7 bankruptcy uses income as a test for eligibility and utilizes income garnishment as a means of settling debt. The non-filing spouse will certainly notice if his or her paychecks are being collected by the bankruptcy court for debt repayment. Even outside Chapter 7 bankruptcy though, there are plenty of other ways for a spouse to discover his or her partner’s financial situation. Our Scottsdale bankruptcy lawyers suggest that hiding bankruptcy is only a temporary solution at best and is not healthy to any marriage nor recommended.

3. Will My Credit or Property Be Affected If My Spouse Files Bankruptcy? In general, one spouse filing for bankruptcy will not affect the other spouse’s financial situation, including the other spouse’s credit rating. A debt is created by contract between a debtor and a creditor – each debtor must sign the contract to be liable for payment. Therefore, the bankruptcy of one spouse does not cause the other to become bankrupt.

4. Does Single Spouse Bankruptcy Change the Nature of Joint Debts? Under Chapter 7 bankruptcy, when a spouse’s debts are wiped clean, the creditor can go after the other spouse. However, a major advantage of Chapter 13 bankruptcy, where the debtor plans to re-pay her debts, is that the creditor will leave the co-debtor alone, as long as bankruptcy plan payments are timely deposited.

5. Are There Any Exceptions? While the bankruptcy of one spouse does not generally affect the other, there are some notable exceptions. For example, the bankruptcy of one’s spouse may show up on the other’s credit report if joint debt is involved – a contentious area of the law. Also, if applying for a joint loan in the future, the bankruptcy of one spouse will affect the creditworthiness of the applying couple.

If you’re considering filing bankruptcy, the Phoenix bankruptcy attorneys can help you. Contact us today to schedule a consultation. 480-744-7711.

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3 Options in Business Bankruptcy

The Scottsdale bankruptcy attorneys at Canterbury Law Group work in business bankruptcy, which allows a company to efficiently sell assets or to liquidate in a controlled manner. Just like any other business strategy, bankruptcy should be considered early enough to be a viable strategy to preserve the business’s assets and help it continue as a going concern. Bankruptcy can also be an important tool for assisting in an orderly wind down and liquidation of a business and its assets. In addition to the some of the strategic benefits, liquidating through bankruptcy can provide numerous benefits over merely dissolving your entity.

There are three types of bankruptcy that your business may file for depending on its business form. Sole proprietorships are legal extensions of the owner; therefor the owner is responsible for all assets and liabilities of the firm. A sole proprietorship can take bankruptcy by filing for Chapter 7, Chapter 11 or Chapter 13. Corporations and partnerships are legal entities separate from their owners. As such, they can file for bankruptcy protection under Chapter 7 or Chapter 11.

1. Chapter 7 – The most common form of bankruptcy in the United States, Chapter 7 bankruptcy, provides individuals with a discharge of all debt which are “dischargeable” under the Bankruptcy Code. In a Chapter 7, all of the debtor’s non-exempt assets on the petition date are liquidated through the priorities set forth in the Bankruptcy Code. At the time of filing, the bankruptcy code establishes the creation of your “debtor’s estate” which includes all “non-exempt assets.” As a Debtor you have various duties and obligations, including significant duties of co-operation, which are owed to the Trustee. These obligations are designed to assist the Trustee in the administration of your bankruptcy estate.

2. Chapter 11 – More individuals, usually with a high net worth, are turning to Chapter 11 to solve their bankruptcy needs. The bankruptcy attorneys at Canterbury Law Group have significant experience with Chapter 11 filings, which tend to be more complex, and are capable of filing an individual case under Chapter 11 as mandated by the facts of each individual case.

3. Chapter 13 – This type of bankruptcy is not a per se liquidation but rather involves a restructuring of debt typically over a three or five-year period, pursuant to a plan which is filed with, and approved by, the Court. This plan allows a debtor to pay its creditors a percentage of the amounts owed to them. Like in a Chapter 7, in a case under Chapter 13, the court appoints a Trustee. Pursuant to the terms of your Chapter 13 plan, you make one single global monthly payment to the Trustee, who then pays the creditors their pro-rata share of what is owed.

Canterbury Law Group is uniquely qualified to represent clients in the sophisticated business bankruptcy cases. The range of services we provide depends on an individual’s or a company’s unique situation. Call us today to schedule a consultation. 480-744-7711. www.canterburylawgroup.com

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Tips When Filing Chapter 7 Bankruptcy

The most common form of bankruptcy in the United States is Chapter 7. At Canterbury Law Group, we constantly work with clients to file Chapter 7, which allows individuals to extinguish all debts which are “dischargeable” under the Bankruptcy Code. In a Chapter 7, all of the debtor’s non-exempt assets on the petition date are liquidated through the priorities set forth in the bankruptcy code. At the time of filing, the bankruptcy code establishes the creation of your “debtor’s estate” which includes all “non-exempt assets.” As a Debtor you have various duties and obligations, including significant duties of co-operation, which are owed to the Bankruptcy Trustee. These obligations are designed to assist the Trustee in the administration of your bankruptcy estate.

The Scottsdale bankruptcy lawyers at Canterbury Law Group will counsel you regarding these duties, which if followed, will make your case run smoothly. Unfortunately, many debtors who are not fully informed of these obligations run the risk of not receiving a full discharge of some or all or their debt. If you’re thinking of filing Chapter 7, here are some recommendations from our lawyers:

1. Complete the Mandatory Credit Counseling – Before you can file chapter 7 bankruptcy, it is essential to complete credit counseling. It is a mandatory step before you can file and often requires paying a fee. Otherwise, your filing will not be allowed to continue.

2. File All Chapter 7 Paperwork – Complete and file all necessary paperwork in court. Make sure all of your paperwork is accurate. Determine any fees associated with your filing.

3. Meet With Your Creditors – Approximately one month after filing the petition, you will need to meet with your creditors, an arrangement made by the court. During this important meeting, your creditors will question you regarding your finances and property. Typically this meeting involves only a few people connected with the credit card companies to whom you owe your debt. Your lawyer can certainly be present to aid you through this process.

4. Attend the Personal Financial Management Instruction Course – In addition to your credit counseling course, a personal financial management course generally costs about $30 and is necessary for completing your filing of chapter 7. If you skip the money management course, you risk dismissal of your case.

Having a trusted legal team on your side is critical during bankruptcy. Call Canterbury Law Group today to schedule your consultation. 480-744-7711.

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Three Tips for After Bankruptcy

The personal bankruptcy attorneys at Canterbury Law Group help clients begin a fresh financial future. Not only can the law team at Canterbury help you successfully navigate through bankruptcy, they can also assist with creating a sound financial afterlife.

Here are three tips for those who are ready to improve their financial status:

Regroup – Once your bankruptcy case has been discharged, reflect on your past financial journey. Ask yourself questions that will help you create a better financial afterlife in the wake of bankruptcy, including:

  • How did I get here?
  • What could I have done differently?
  • And what have I learned from all of this?

Create a Realistic Budget and Pay Bills on Time – After bankruptcy, you must become vigilant about your finances. Even if you haven’t created a budget in the past, now is the time to get serious about doing so. Your budget will act as your spending plan, helping you to manage cash flow and preventing you from creating unnecessary debt. Make it a priority to pay all your current bills in a timely manner. Set up automatic bill payments, and remember to pay your rent on time since rent payments are now being tracked by the credit bureaus.

Pick a Credit Card That Will Help You Rebuild Credit – A key strategy to rebuilding your credit rating after bankruptcy is to obtain a secured credit card. With a secured card, you deposit a given amount of money, such as $500, into a bank account and that $500 becomes your credit limit. By charging small amounts each month and repaying your debts as agreed, you can gradually rebuild your credit.

If you have questions about your finances and / or bankruptcy, call Canterbury Law Group today to schedule a consultation. 480-744-7711.

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Illegal Practices Commonly Associated with Debt Buying

“Debt buying” affects millions of Americans and takes place when large companies buy and sell billions of dollars of debt. Credit card companies, hospitals, personal loan companies, banks and other lenders regularly sell and resell debt – and this may include debt that you owe.

For example, if you open a Visa account with a local bank and eventually stop repaying on your loan, the credit card company terminates your account and starts sending collection letters. The credit card company may decide to sell your debt for cash. Depending on how delinquent the debt is, a debt buyer may pay only 4 or 5 cents on the dollar. Your debt will then be packaged along with other similar debt and sold in bulk to a debt buyer at this discounted rate. The debt buyer will then attempt to collect the debt by calling you or the buyer may retain a lawyer and sue you.

Debt buying is legitimate as long as the debt buyer follows the rules. Debt buyers also realize that most consumers do not know the rules so the debt buyers often take advantage of a consumer’s limited knowledge.

Some debt buyers practice illegal tactics including:

  • Repeated collection calls that violate the Fair Debt Collection Practices Act ban on harassment and after hours calls
  • Misleading consumer into consenting to autodialed calls
  • Failure to respond to consumer disputes of debt
  • Farming debt to law firms for litigation without appropriate documentation
  • Threatening consumers with lawsuits for debts where the statute of limitations has run
  • Collecting on debt where the debt buyer has no documentation

The Consumer Financial Protection Bureau is starting to go after debt buyers who pursue illegal practices. For example, the CFPB recently imposed a $79 million penalty against to large debt buyers – Encore Capital Group and Portfolio Recovery Associates.

The bankruptcy attorneys at Canterbury Law Group are uniquely qualified to represent you in your debt related litigation. If you’re experiencing actions from debt buyers that may be illegal, call us today to schedule your consultation. 480-744-7711

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3 Steps to Take Before Filing For Scottsdale Bankruptcy

At Canterbury Law Group, our Scottsdale bankruptcy attorneys are top industry experts. We represent clients through the entire bankruptcy process and, although all cases are unique, the end goal of bankruptcy is always a fresh financial start.

Here are three tips for people that are starting to think about bankruptcy.

  • Gather documents. You must start collecting financial documents for your attorney. Obtain a record of debt including credit card bills, unpaid medical bills, loan statements, etc. Also locate any documentation on assets you currently hold and monthly income statements.
  • Find a qualified legal team. Filing for bankruptcy is a complicated process and a simple mistake can be detrimental to your case. Make sure you have a legal team that is experienced, understands your goals and can get the job done. Many law firms offer a complimentary first-time consultation or cut-rate deals. Generally speaking, uou get what you pay for. Instead, call Canterbury Law Group today to schedule your appointment.
  • Better your financial habits. You need to make sure you improve your financial life after your file bankruptcy. Educate yourself by reading books, reviewing financial websites and seeking out professional guidance. Obtain a secured credit card or personal loan to start building up your credit but remember that you may have to wait some time before you can be approved for a secured credit card.

As authorities in the legal industry, the bankruptcy counsel at Canterbury Law Group was uniquely formed to provide no-nonsense legal counsel for personal and business bankruptcy cases. The team’s attention, experience and sophistication allows for innovative resolutions that generate positive client results.

Put time on your side and consult on your possible bankruptcy sooner than later. Our legal team is ready to represent you in your Scottsdale business bankruptcy case. Call us today to schedule your initial consultation. 480-744-7711.

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Filing Chapter 7 Bankruptcy in Scottsdale

Chapter 7 bankruptcy is one of the most common types of bankruptcy. Filing bankruptcy in Scottsdale can be a very intricate and overwhelming process, so the dedicated law team at Canterbury Law strives to help clients every step of the way.

A Chapter 7 bankruptcy filing provides immediate relief for those who are struggling with unsecured debt such as medical bills, credit card debt and certain tax debt. It is a valid means of resetting your financial life and getting back on track with your finances. Chapter 7 provides individuals with a discharge of all debts that are “dischargeable” under the Bankruptcy Code. Notably, some debt, like child support obligations and student loans are, for the most part, non-dischargeable.

It is wise to work with experienced legal counsel when trying to negotiate the complex process of filing for Chapter 7. The law team at Canterbury Law in Scottsdale has experience with the most intricate bankruptcy cases.

Stopping Collections Actions – After filing for Chapter 7, all collections activities from creditors will go through an automatic stay, or stop. Approximately four months after your filing, you will receive a Chapter 7 discharge, which will release you from personal liability on most debts and prevent creditors from contacting you regarding these discharged debts.

Qualifying for Chapter 7 Protection – A means test is needed to qualify for Scottsdale Chapter 7 bankruptcy protection. If your current monthly income is below the adjusted median income in Arizona, you automatically pass the test. If you do not meet these initial requirements, you must pass a secondary means test that deducts expenses to determine if you qualify.

It is important to have an experienced Scottsdale bankruptcy lawyer to help guide you through this filing bankruptcy. The bankruptcy lawyers at Canterbury Law will counsel you to help settle your debt and start fresh with your finances.

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