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Garnishment is No Fun

When a garnishment hits, it usually hits hard, with as much as 25% of a debtors monthly paycheck going directly to their creditors.

Bankruptcy Stops Wage Garnishment

Through the power of the automatic stay, filing for bankruptcy stops all creditor collection activity including foreclosure, lawsuits and wage garnishment. If your wages are currently being garnished, filing for bankruptcy will obligate your creditors to immediately stop taking money out of your paycheck. In fact, if a single creditor has garnished more than $600.00 in the 90 days before your bankruptcy case was filed, the creditor can be required to return the garnished money. Creditors who continue to garnish wages, after receiving notice of a bankruptcy, can be sued for sanctions and forced to return the improperly garnished funds.

Garnishment for Child Support Payments

Be aware that there are exceptions to this rule.

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| Tags: Bankruptcy Stop, Wage, Wage Garnishment
Posted July 1, 2011 by Imogen Lay under Credit Report

On Friday at about 5:00 p.m. local time, 34 individuals (from the court filings, it appears not represented by counsel) filed an involuntary chapter 11 bankruptcy petition against Bank of America, N.A. (a banking subsidiary of Bank of America Corporation (NYSE: BAC)).  In the petition, the individuals assert claims against Bank of America of between $1 million and $30 million, with a total claimed amount of approximately $60 million.  Many of the individual petitioning alleged creditors identify themselves in the signature pages as members of either the Independent Rights Political Party or the Independent Rights Party.  On Sunday, Bank of America filed responsive papers with the bankruptcy court, in which it asserts that the petition is clearly invalid and that Bank of America cannot be a debtor in an involuntary bankruptcy case.

Bank of Americas Sunday filings consist of an answer to the purported involuntary petition and a motion to dismiss the involuntary case with an accompanying memorandum in support.  I Read more…

| Tags: 11 Bankruptcy, 11 Bankruptcy Petition, America, Bankruptcy Petition
Posted June 30, 2011 by Imogen Lay under Credit Report

You Can Keep Your Car When You File Bankruptcy

Although these days riding the bus may be the more green mode of transportation, for many people driving their car is something they cannot do without and in order to be able to truly have a fresh start. Then need to be able to keep their car so that they can get to an from work and get around to all the places they go in their daily lives. So when I meet with a new client for a bankruptcy consultation and learn that they are under the mistaken belief that if they file for bankruptcy a bus pass will soon be their next best friend, I am happy to relieve their concern and inform them that, in actuality, most people retain their car when they file for bankruptcy.

The other day my client drove to my office for a bankruptcy consultation in his luxurious Mercedes-Benz with custom rims and all the bells and whistles.

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| Tags: Bankruptcy, Car When, File Bankruptcy
Posted June 30, 2011 by Imogen Lay under Credit Report

THANKS to the Federal Trade Commission in Washington, DC, for kindly providing much of the information in this article.

The possibility of losing your home to foreclosure can be terrifying. The fact that scam artists are preying on desperate homeowners in financial distress is equally frightening.

Many companies say they can change your home loan and reduce your monthly mortgage payment or take other steps to save your home from foreclosure. They claim that nearly all their customers get successful results. They may offer a money-back guarantee. Others say theyre affiliated with the government or your lender. And still others promise the help of attorneys or real estate experts.

Unfortunately, many mortgage relief companies tell you half-truths and even lie to sell their services to prevent home foreclosure. They promise relief from high mortgage payments and the threat for forclosure, but dont deliver.

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| Posted June 30, 2011 by Imogen Lay under Credit Report

Dismissing a Bankruptcy Case

While bankruptcy has the ability to provide great relief to those facing financial difficulty, it is not always a bed of roses. There are things that can go wrong with a bankruptcy case. Many debtors learn the hard way that bankruptcy can be a messy place once the motions and objections start flying around.

Can a bankruptcy case be dismissed? Yes. Is it easy to dismiss a bankruptcy case? That depends on what chapter of the Bankruptcy Code youve filed under and whether you have assets that the trustee is interested in.

Dismissing a Chapter 7 Bankruptcy Case

Most would assume that if youve voluntarily entered into bankruptcy, you can just as easily get out. However, when it comes to chapter 7 bankruptcy, this is not the case. Once a chapter 7 has been filed, your attorney will need to file a motion asking the court to allow your case to be dismissed. Ultimately, the judge will have the final say as to whether you get to leave the bankruptcy world.

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| Tags: Bankruptcy, Bankruptcy Now
Posted June 29, 2011 by Imogen Lay under Credit Report

Sbarro in Bankruptcy? DUH.

Is anyone really all that surprised that Sbarros chain of Italian quick service restaurants  filed for chapter 11 bankruptcy protection? Or put another way, has anyone, or anyone that you know, ever willingly eaten at a Sbarro restaurant? Dont get me wrong, Im far from a food snob. As a bachelor, Ill eat just about anything. Im very lucky if I have non-liquid, edible food stuffs in my fridge at any given time. McDonalds? Great company. Subway? Sure, why not. Occasional Quiznos in the airport? Yep. Late night crappy Chinese food? Where do I sign?

Sbarro? No thank you.

At least here in New York City, Sbarro was/is the Serengeti equivalent of the badly wounded Wildebeest, limping around the competitive Italian food market just waiting to be demolished by a lion, hyena or cheetah. In my lower Manhattan neighborhood alone, there are an infinite number of pizza destinations Id gladly turn to before settling for  the sweaty, heavy cheese of a Sbarro slice. T

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| Tags: Bankruptcy, Bankruptcy Darwin
Posted June 29, 2011 by Imogen Lay under Credit Report

Summary

In an 11 page opinion published June 14, 2011, Judge Walrath ruled that a Chapter 7 Trustee’s lack of specificity in pleading a preference action was grounds for dismissal under FRCP 12(b)(6). Judge Walrath’s opinion is available here (the “Opinion”).

Background

Tweeter Opco, LLC and its affiliates (the “Debtors”), filed voluntary petitions for bankruptcy on November 5, 2008. On December 5, 2008, the case converted to a chapter 7 liquidation and George L. Miller was appointed as the chapter 7 trustee (the “Trustee”). On November 2, 2010, the Trustee brought an action against Mitsubishi Digital Electronics America In. (“Mitsubishi”) to recover alleged preference payments. The Opinion was given in response to Mitsubishi’s motion to dismiss the complaint under FRCP 8(a) and 12(b)(6).

Judge Walrath’s Opinion

In the Opinion, Judge Walrath cited heavily from Supreme Court opinion. In this Opinion, she ma

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| Tags: Preference, Requirement Pleading
Posted June 28, 2011 by Brayden Laura under Credit Report

Summary

In a 5 page decision signed May 4, 2011, Judge Walsh of the Delaware Bankruptcy Court held that a proceeding initiated by a Debtor, seeking contribution relating to environmental claims is non-core. Judge Walsh’s opinion is available here (the “Opinion”).

Background

NEC Holdings Corp. and related entities (the “Debtors”) filed for bankruptcy on June 10, 2010. At this point, their last remaining substantial tangible asset is property in New Jersey that has been environmentally contaminated. The Debtors commenced an adversary proceeding in the Bankruptcy Court against a number of entities under theories of liability based on the environmental contamination of NEC’s last remaining piece of real property.

The Defendants quickly moved the Court for a determination that the claims in the adversary proceeding are non-core.  Because Bankruptcy Courts are courts of limited jurisdiction, this is one method of removing a proceeding from the Bankruptcy Court.

Judge Walsh’s Opinion

Judge Walsh cited In re Exide Technologies, 544 F.3d 196 (3d Cir. 2008) in opini

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| Tags: Decision, Decision Nec
Posted June 28, 2011 by Brayden Laura under Credit Report

The Seventh Circuit Court of Appeals affirmed a decision of Judge Bruce Black of the United States Bankruptcy Court for the Northern District of Illinois in the In re River Road Hotel Partners, LLC et al. chapter 11 cases. The decision which was the subject of the appeal denied approval of the debtors proposed bid procedures for a sale of substantially all of their assets, which are comprised primarily of the InterContinental Hotel Chicago OHare located in Rosemont, Illinois (a suburb of Chicago close to OHare International Airport).

The decision also applies to the denial of substantially similar bidding procedures proposed in the bankruptcy cases of In re RadLAX Gateway Hotel, LLC et al. Those debtors own the Radisson Hotel at Los Angeles International Airport.

The cases are: River Road Hotel Partners, LLC; River Road Expansion Partners, LLC; RadLAX Gateway Hotel, LLC; and RadLAX Gateway Deck, LLC vs. Amalgamated Bank (Case Nos.

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| Tags: Hotel, River Road, River Road Hotel, Road Hotel
Posted June 27, 2011 by Imogen Lay under Credit Report