Waltzer Law Group

Bankruptcy can help you save your home in several ways.

The first way is with the “automatic stay”. The short explanation is that once you file bankruptcy, the law stops all your creditors- including your mortgage company- from taking any collection action at all. This stops foreclosure, calls, repossession and every other form of collection. The down-side is that the automatic stay only lasts a few months. It will not be a long-term solution to your problem, but it could buy you time to find a long-term solution.

Another way bankruptcy can help you save your home is with a repayment plan just for mortgage arrears. In Chapter 13 bankruptcy, you can repay the arrears on your mortgage over a period of several years. For instance, if you owe $50,000 in arrears on your mortgage, and you do a Chapter 13 bankruptcy, you can pay that $50,000 in 60 monthly installments. However, you must stay current on mortgage payments in addition to making the monthly bankruptcy installment payments. So, consider this. If you could not keep up with your mortgage, how are you going to keep up in the future AND pay a bankruptcy payment every month? You might need an attorney to help you answer that question.

If you are filing Chapter 7 bankruptcy, there are two important opportunities when you can save your home and property.

The first opportunity is BEFORE you file bankruptcy.
If you have an excellent bankruptcy attorney, he or she will be able to tell you whether your house would be at risk. Your attorney will be able to advise you if there is a way to protect the house. Most importantly, a good attorney will be able to prevent you from blindly filing your bankruptcy and finding out if the house is not safe after it is too late.

The second opportunity is WHEN filing bankruptcy.
Assuming your house can be protected in bankruptcy, your attorney can ensure it is safe by taking the proper bankruptcy exemptions The bankruptcy exemptions are like an invisible shield that protects certain pieces of property during bankruptcy. The exemptions are different for different states.

The most important rule to remember is that you can never keep a house without paying for it. This is true whether you file bankruptcy or not. The only thing bankruptcy does is eliminate liability for a deficiency in the event that the property is sold at foreclosure. For example: Imagine that your house is worth $300,000 and you owe $350,000 on the mortgage. Your house is sold at foreclosure for $300,000. You are still on the hook to pay the balance of $50,000. If you had filed bankruptcy (and not reaffirmed the debt) you would not owe anything after the foreclosure.

The other benefit of bankruptcy related to home-ownership is “the strip”. In some cases, you can actually get rid of a second mortgage through Chapter 13 bankruptcy!

Virtually all of this applies in the same way to cars.

The way to stop creditor calls for a while is to hire an attorney to take the calls.

Once creditors are notified that you are represented by an attorney, they must contact you through your attorney. However, this strategy is limited because while creditors wont call you any more, they can sue you and freeze your accounts and garnish your wages.

To permanently stop creditor calls you have two choices:

The only ways to permanently stop creditors are to pay the creditors off or file bankruptcy. Filing bankruptcy will stop all collection activity by creditors no matter what the stage of collection. If the debt is dischargeable, the activity will be stopped forever. If the debt is not dischargeable, such as student loans or recent tax debt, the collection will only be stopped temporarily.

One good thing about hiring an attorney is that many creditors will refrain from suing you. If they think you are going to file bankruptcy anyway, they might be likely to invest in additional collection activities. This is not guaranteed, but it is a trend we see in our practice.

At Waltzer Law Group one of the services we provide is that we handle all creditor calls BEFORE you are paid in full. That way, even if it takes you a little while to pay for your bankruptcy, you can enjoy relief instantly.

The cost of chapter 7 bankruptcy is:
Filing fee: $399
Credit counseling: $70-$100 depending on the service used.
Lawyer fee: case specific but please read below:

Our prices are low because we file a lot of cases and we can do things very efficiently. We pass that savings to our clients. However, we don’t want you to hire us because of ‘price’. You should hire us because we are excellent and we will handle everything properly and quickly. If you are simply price shopping please read the story below and rethink how you want to handle this very important decision.

Consider the story of two painters. Dufus and Prudent.

The first painter, Dufus, gets a call from a prospective client. The caller asks, “how much will you charge to paint my house” The painter replies “I charge $1000 to paint a house”.

The client thinks that is expensive and calls the second painter. The second painter, Prudent, answers the phone. The caller asks, “how much will you charge to paint my house? Will you paint it for less than $1,000″. Prudent replies with a series of questions about how many rooms, the square footage of the house, the age of the last paint job, the shape and material on the walls. The client says, “I don’t know the answers to all those questions”. Prudent suggests that the client put together the answers and only then can he give a quote.

If the client goes with Dufus, the first painter, it might be that the job is a $2,000 job. Dufus is desperate for money so he takes the job and the $1000 down. He paints a room and then asks for more money. Now Dufus and Client are in a fight. The job never gets done and Client ends up having to hire someone else, or suing Dufus. Alternatively, Dufus honors his agreement but paints the house so sloppily that a couple months later it needs to be redone correctly. Now Client has lost $1000 and is back to square one. It is a lot of yuck!

If the client listens to Prudent and gets the proper information to Prudent, Prudent might tell client it is a $2,000 job. Client can prepare for the expense and if Prudent is like my firm, client can do a payment plan.

With a painter like Prudent, the client can sleep well at night knowing that everything will be done properly. Why? Because he is thoughtful. He thinks things through and does things carefully and sensibly. He is not desperate; he is quality.
That is the type of person Client should hire.

Waltzer Law Group is like Prudent. We are fair and reasonable. We are not scrambling for the next dollar. We have to be careful because being careful is the only way to prevent misunderstandings and miscommunication. When we tell you a price, you can rest assured that that price is all you will ever pay. We don’t play games or bait and switch with our clients. We take pride in doing great work with honor.

We typically don’t quote people over the phone or advertise price because it would be irresponsible to do that. Why? Because we need to really look at your situation closely to know just what is involved in your case. Though fees for a simple chapter 7 bankruptcy with a good lawyer are around $1500 to $2500, there are additional things to consider that could impact the cost. Consider the extra work that goes into cases for clients with houses, cars, high income, recent debt, tax debt, businesses, inheritance, recent transfers, recent payments to people and many other factors that make a simple-looking case much more complex.

There are many ways to answer the question “How does bankruptcy work?”

Here are three descriptions of bankruptcy:
A summary of bankruptcy, why it exists and what it can do.
The ten steps of a Chapter 7 bankruptcy (or 8 steps if you have a good attorney)
The three main kinds of bankruptcy

A summary of bankruptcy, why it exists and what it can do.

The basic idea has been a part of our society as long as history itself. The practice of filing bankruptcy is hugely common in the United States. Millions of Americans file bankruptcy every year. It is likely that many people you know filed bankruptcy. They just don’t tell everyone.

The basic idea is that every seven or eight years, people should have their debts forgiven. Bankruptcy could be said to be the “anti slavery” law. Think about it. If you owe more debts than you can ever pay, and all you do is work day after day to pay those debts, what are you? Are you really free? Is it fair to lend someone money and then force them to work until they die in order to pay it back? Our society says it is not fair to do that. So, we created bankruptcy laws. They are a legal way that people can get freedom from their debt every 8 years. These laws are particularly important to protect borrowers from predatory lending. Predatory lending is when you give someone money and intentionally make it very hard for them to pay it back. Predatory lenders use high interest rates, finance charges, excessive late fees, and administrative difficulty (long hold times and difficult channels of contact) to make it harder for you to pay them back. Why? So they can make money. They lend $100 and they get paid $200 back. Our government created bankruptcy to protect you from these predatory lenders, and in order to give you a break when you are unable to pay your debt.

When you file bankruptcy you are basically telling the court three things,
1- I cant afford to pay this debt anymore
2- I don’t have anything that you could sell in order to pay creditors. (most of my clients are allowed to keep their house and cars)
3- I am an honest person. I got this debt thinking I would be able to pay it back, but things happened and I couldn’t keep up.

If these three things apply to you, and you feel like you could say them to the court, bankruptcy was created for you. Bankruptcy can give you a  new fresh start without creditor harassment.

Here are some other questions people often have about bankruptcy:
Can I keep my house?
Can I keep my car?
Will bankruptcy ruin my credit?
How long after bankruptcy can I buy a house or car?
What kind of debt will bankruptcy get rid of?
How much does bankruptcy cost?
Will bankruptcy stop a garnishment, bank freeze or law suit?
Do I have to repay my creditors?
Can I get rid of student loans?
Can I get rid of tax debt?
How often can I file bankruptcy?
How will bankruptcy impact my family, spouse and children?
What if I co-signed for someone else’s house or car?
What if I am not a US citizen?
Can I file bankruptcy for my business?
How do I chose a good attorney?

The three main kinds of bankruptcy
There are several kinds of bankruptcy. However, there are really only two that most people reading this would need. The third is mostly for corporations.

Chapter 7 bankruptcy
The first and most famous and most common kind of bankruptcy is “Chapter 7″. It is called chapter 7 because the laws that guide that kind of bankruptcy are found in “Chapter 7″ of the bankruptcy code.

Chapter 7 bankruptcy is the kind where you obliterate all of your debt from credit cards, medical bills, non-fraud-related law suits, car loans on repossessed vehicles, mortgages for houses you don’t want to keep, some tax debt and many other kinds of debt.
With this kind of bankruptcy you eliminate the debt all at once!

Chapter 13 bankruptcy
The second kind of bankruptcy is Chapter 13 bankruptcy. Just like Chapter 7, Chapter 13 gets its name because the chapter of the bankruptcy code that explains the law for this kind of bankruptcy is “Chapter 13″.

Chapter 13 bankruptcy is a kind of bankruptcy where you repay some or all of your debt over a period usually from 36 to 60 months. Chapter 13 is usually for people who fall into one of the following five categories:
1- you have too much income for Chapter 7 bankruptcy.
2- you have an asset (perhaps a house) that is so valuable that it would not be safe in a Chapter 7 bankruptcy.
3- you have a kind of debt that wont be wiped out in a chapter 7 bankruptcy and you need extra time to pay it.
4- you have filed chapter 7 bankruptcy within the past 8 years.
5- you want to get rid of a second mortgage or reduce your liability on your car loan.

Chapter 11 bankruptcy
The third kind of bankruptcy many people have heard of is “Chapter 11″. Chapter 11 is usually for corporations and businesses that need to keep operating, but are unable to pay their debts. We have seen General Motors, Chrysler, and many other major corporations file Chapter 11 bankruptcy. What happens in this bankruptcy is that the business keeps operating, but the revenue and expenses are monitored by a “trustee” whose job is to make sure of two things:
1-the trustee protects the company from creditors and prevents creditors from suing, freezing assets and wrecking the business.
2-the trustee protects the creditors to make sure they are paid fairly and that the company owners don’t run off with the income without paying the creditors

The ten steps of bankruptcy (more likely only 8 steps if you have a good attorney)

Step one: find a trusted and experienced bankruptcy attorney. You don’t have to use an attorney to file bankruptcy but it is very dangerous not to. There are many things that might seem very innocent and unimportant to you that can get you in a lot of trouble. The law is tricky and the law can be heartless. Many people who try to save a few bucks on a bankruptcy attorney end up losing houses or cars or other things that belong to their friends and family. Bankruptcy, particularly after the new bankruptcy law, is not something a careful person would try without an attorney.

Step two: prepare the paperwork called petition and schedules. Petition and Schedules consist of over 40 pages that must be filled out in order to get a bankruptcy. You must fill the information out perfectly or you could have big problems.

Step three: amass supporting documentation that must be submitted with the petition and schedules.

Step four: take credit counseling

Step five: file your bankruptcy!

Step six: go to your bankruptcy hearing where you are examined by the bankruptcy official, called a trustee.

Step seven: if your case is approved then you skip step seven. If it is not approved, you must provide additional documents and re-file some of your paperwork. If you have an attorney, you are more likely to get to skip the next two steps and go right to step nine!.

Step eight: return for a second examination (this is only if you had problems with step six or seven)

Step nine: take the second part of your credit counseling.

Step ten: wait for your discharge (when your applicable debt is totally and permanently eliminated).

We see the problems every day. Debt, fear of losing a home or car, creditor harassment, or concern that some of these nightmares will soon become a reality are what bring people to the point of needing assistance. I understand the pain and anxiety you must be experiencing. My clients often come to me complaining that they can not sleep soundly or they are filled with anxiety. My team and I do everything possible to give peace to our clients- to give them a real fresh start.

The first problem is that there is so much misinformation out there. The misinformation comes on the web, in radio and TV announcements, and through the rumor mill- even from well intentioned friends and family!

So what’s the first step?  The first step is to be informed. Know the facts so that you can find the right person to give you the best solution for your situation. The information you will find at Waltzer Law Group will help you make an informed decision about your own path to financial freedom and peace of mind.

For most clients that come into my office the solutions fall into one of six categories. Sometimes we even combine solutions when it is best for our client.

1- Stay the Course: continue paying, or not paying your debt; basically doing nothing different at all.

2- Debt Negotiation (also called Debt Settlement): Though Waltzer Law Group attorneys are expert debt negotiators, we only recommend this when necessary. Debt Negotiation can destroy your credit and cost you thousands of dollars for nothing. Don’t believe the misinformation that comes from ‘debt settlement’ companies. These companies are usually as bad or worse than the creditors themselves. That being said, for some people debt settlement IS the best solution. So, I always consider it when finding the right solution for my client.

3- Chapter 7 bankruptcy:  Gets rid of all your dischargeable debt in one shot.  The simple explanation is that most debt is dischargeable. The main kinds of debt you can not wipe out in a chapter 7 bankruptcy are:
student loans,
some tax debt,
divorce liability,
debt from fraud,
alimony/child-support,
fines/tickets,
secured loans on things you want to keep (like a mortgage for your home)

4- Chapter 13 bankruptcy : Repays your debt or a portion of it over several years.

5- Debt consolidation (where you set up a repayment plan over several years outside of bankruptcy). This too has its dangers and should only be used when necessary.

6- Financial Planning: This is getting expert advice on how to handle your debts and finances, personal or business. Many of my clients are not served well by any of the other options. They just need someone to help them plan how to get out of their situation. They just need some sound, honest advice and coaching.

Facing debt is scary, and requires courage. The great news is that you have already taken the most important step in finding your debt-solution. I know that because you are reading this right now. You are seeking expert assistance. Explore our site or call us for help. Financial freedom is closer than you think!