South Atlanta Bankruptcy Blog

If you are one of the millions of Americans struggling with insurmountable debt and financial stability, then you have come to the right place for help. South Atlanta Bankruptcy's attorneys Gina Karrh and H. Brooks Cotten will be using this blog to provide information about bankruptcy. Don't hesitate to call us TODAY!

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H. Brooks Cotten

H. Brooks Cotten

H. Brooks Cotten graduated from Cumberland School of Law in Birmingham, AL in 1981.  He earned an MBA at Monterey Institute of International Studies in California in 1987. He has a reputation as a knowledgeable attorney who is not afraid to litigate close legal issues on your behalf.

Redemption in Chapter 7: Keep Your Car While Lowering the Payments

Posted by on in Chapter 7

In Chapter 7, there are three possibilities for dealing with a debt that is secured by collateral, one of which is a redemption. Redemptions are usually only done with regard to vehicles, though it would be theoretically possible to do it with other types of personal property too. This article deals with redeeming cars. This is possible in Chapter 7, but not Chapter 13.

First, with the agreement of the creditor, you may keep the car, and continue your obligation to pay for it. This is called a reaffirmation. The effect is to leave the car out of the bankruptcy and continue to pay for it, usually under the terms of the original contract. A reaffirmation usually requires that you be current in your payments on your car note.

The second possibility is to surrenderthe collateral. In that case, you lose the car to the creditor, and the debt is discharged. The creditor cant collect any money later. This makes sense when you cant afford the debt, or if something is wrong with the collateral so that you prefer to pursue other options. You can certainly surrender the collateral even if you are behind on the debt and a reaffirmationis not possible.

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Tax Refunds, Lawsuit Recoveries, and Inheritances

Posted by on in General

If the state or federal government owes you money for a tax refund that you have not yet received, this is considered to be an assetowned by you similar to money in your bank account. Assets should be disclosed in bankruptcies. You are then allowed to exemptor protect those assets within certain dollar limits depending on what the asset is, and depending on how many people own it.

In some Chapter 13's, but not all of them, you might be required under your plan to pay in part of future tax refunds to pay creditors if they would not be paid in full otherwise. You should ask the lawyer about this if you are filing Chapter 13.

In either Chapter 7 or Chapter 13, disclosing assets is the proper way and best way to protect them. Hiding or failing to disclose assets can result in the loss of protection that you would otherwise have, and creditors and Trustees can make problems for you if they allege that you failed to disclose something that should have been disclosed.

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Pick Your Lawyer Carefully, Then Trust That Person

Posted by on in General

We frequently receive calls from people who filed their bankruptcy case with another lawyer, and now want to change lawyers. Sometimes its because the first lawyer wont return calls. Sometimes the client just doesnt understand requirements and procedures. Sometimes they have received objections, and believe their case has been thrown out, or will be thrown out, no matter what they do. Sometimes clients suspect that they are not receiving the best deal possible.

To be successful, bankruptcies require that the paperwork be done accurately. Each case is different, and one size definitely does not fit all. The lawyer needs documentation (paystubs, tax returns, bills, letters, etc.) to fill out the forms at the beginning and on an ongoing basis so that the Trustee or creditors do not object. Debtors often believe that approximations are good enough, and that they are free to pick and choose which debts to file. Approximations work occasionally, but not always. You are always supposed to list all of your debts, even if you are keeping the property or paying for it outsidethe bankruptcy. The general rule is that everything is disclosed, even though there may be considerable freedom in deciding how debts or assets are treated in the plan or statement of intentions.

Our experience is that taking time to be accurate on the front end greatly reduces anxiety, and reduces complications in both simple and hard cases. Naturally, hard cases, like business cases or repeat filings, take longer to get right than simple cases. Sometimes clients believe that their case is hard, when really its easy, and sometimes they think its easy, when its complex for reasons they did not anticipate. Either way, it works best when everyone understands the challenges and benefits as early as possible. The best way to make that happen is to be prepared with paperwork. Keep appointments. Listen carefully to questions, and trust that the lawyer really is on your side even if he warns you about constraints. Trust that the lawyer wants you to succeed, and get what you want as badly as you do.

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Judgements : What are they and how do they effect you?

Posted by on in General

A judgment is preceded by the filing of a law suit:

Let’s assume that you have not filed bankruptcy. Under general contract law, if a person borrows money, and is late in repaying it, the lender may sue to collect the debt. A lender starts a law suit by filing a “summons and complaint” that usually states that payments have not been made as required in the contract. A Summons and Complaint are papers are issued by a court, and are not merely collection letters from the creditor. The papers are usually pink or yellow. A suit requires that the defendant/borrower file an “answer” within 30 days. The answer should state a reason why the borrower is not legally obligated to pay the debt as stated in the complaint.

If the borrower files an answer on time, a hearing will be assigned. Otherwise, if the borrower fails to answer, or if his answer is legally inadequate, then the creditor will win, and a Judgment will be entered against you. The creditor may then use that judgment as the basis to “garnish wages” or “levy a bank account” to collect the money owed to it. Alternatively, if you own real estate, a judgment could be recorded in Superior Court’s real estate records. A recorded judgment functions like a second mortgage, and if you wanted to sell or refinance that real estate at a later date, the judgment would have to be paid to deliver clear title to the buyer or bank.

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