Sacramento Bankruptcy Lawyer Blog

I am an Oakland Bankruptcy Attorney and deal with same-sex legal issues in the context of bankruptcy.

In today's post we'll continue our discussion of issues affecting same-sex couples in terms of filing for bankruptcy together.

Bankruptcy Attorneys in Oakland on DOMA

In yesterday's post we talked about how the Defense of Marriage Act prevents same-sex couples from filing jointly for bankruptcy. However, this is not necessarily a bad thing.

Filing chapter 7 or chapter 13 bankruptcy

First, having to file separately can be advantageous due to the exemption system covering property. Many states do not allow married couples to double up their exemptions. This is true regardless of whether the file jointly or separately. Unmarried couples can thus maximize the amount of property they are able to exempt (and thus keep).

Second, in states that subscribe to the community property system (such as California), all property that is acquired after marriage is considered community property and is thus part of the bankruptcy estate. This is true regardless of whether only one spouse files. This means that more property is subject to the control of the bankruptcy court.

Of course, one disadvantage to having to file separately is you'll also have to pay a separate filing fee. But the benefits to being able to file separately just may outweigh the detriments.

As a bankruptcy attorney in Oakland I often encounter the legal issues what assets are regarded marital property in a chapter 7 or chapter 13 bankruptcy.

Today we'll discuss what happens to marital property when a married person files for bankruptcy on an individual basis.

Marital property is that property which a married couple owns together. Whether this property will be included in your bankruptcy estate will depend on (1) your filing status (jointly or alone), and (2) your state's marital property laws. (Your bankruptcy estate is that property which is subject to the reach of the court once your file for bankruptcy.)

Oakland Bankruptcy Lawyer on Community Property

California is a Community Property state. In a community property state, all property which either spouse receives during marriage is considered to be jointly owned by both people (and thus community property). The only items not considered to be community property are gifts or inheritances received separately or property which you brought with you into the marriage.

If you're married and file for bankruptcy in a community property state, all that property which you jointly own will be included in your bankruptcy estate. This holds true despite the fact that you may be filing individually. The only property that won't be considered part of the bankruptcy estate is your spouse's separate property. This is something to be clear on before making the decision to file.

As a Sacramento Bankruptcy Attorney I advise my cleints frequently on what to keep and what to surrender in a chapter 7 or a chapter 13 bankruptcy.

Yesterday we discussed the issue of what happens to your vehicle when you file for bankruptcy. In most cases, you can choose whether you want to keep or surrender it. Let's explore these options more in detail.

If you choose to give up your car or truck you simply state your intention to surrender it on the Statement of Intention form that you file with your bankruptcy papers. That's all there is to it. You won't be responsible for any debt associated with your vehicle after your bankruptcy.

If you want to keep your vehicle there are different ways of accomplishing this. First, you can buy it by giving your lender a lump sum payment based on its current value. This is what's known as Redemption. Second, you can enter what's known as a Reaffirmation Agreement. This is essentially a new contract that allows you to keep your vehicle and continue making payments in line with the original vehicle loan.

Also, a lender will sometimes allow you to retain your vehicle without signing a reaffirmation agreement. You can simply continue to make your payments according to your original loan. This is what's known as a Ride-Through agreement.

I am a bankruptcy attorney in Solano County and encounter the question whether to keep or not to keep the car in a chapter 7 or chapter 13 bankruptcy on a daily basis.

Walking Away From the Car
If you want to walk away from the car, you list the lender on your SOI and state that you intend to surrender the vehicle -- that is, turn it in to the lender. This will clear you of any further liability on the debt after your bankruptcy. If you are leasing your car, you can get out of the lease by rejecting the lease on your SOI.
Keeping a Car You're Still Paying For
If you want to keep a car you are making payments on, no matter what else is going on in your bankruptcy, you should continue to make your payments as scheduled. You do have a choice, however, on how to keep the car: You can either pay the lender a lump sum to purchase the car at its current value (called redemption ), or enter into a new contract (called a reaffirmation agreement), which lets you keep your car under much the same terms as your original car's promissory note (although this is negotiable).
Sometimes your lender will let you keep the car without entering into a reaffirmation agreement, by simply allowing you to continue to make the payments under the old agreement (this is called the ride-through option). If your lender has been accepting your payments, it's a sign that you may be able to retain the vehicle and continue making payments without entering into a new reaffirmation agreement.

I am a Sacramento Bankruptcy Attorney and would like to give some insight into the bankruptcy process be it chapter 7 bankruptcy or chapter 13 bankruptcy.

Many people who are considering bankruptcy are concerned about what will happen to their vehicle if they decide to file. If you file for Chapter 7 bankruptcy you'll be able to choose whether to keep or give up your vehicle.

The first important inquiry in this regard is whether you're still paying off your vehicle. If you've already paid off your vehicle you'll be able to retain it provided its value falls below the exemption amount set forth by your state for vehicles.

If, on the other hand, you're still making payments, you'll be faced with the choice of keeping or surrendering your vehicle during the course of your bankruptcy case.

You let the court know your decision in this regard by filing what's known as a Statement of Intention along with your bankruptcy papers. This form sets forth your intention to either give up your vehicle (by rejecting the loan) or keep it (by assuming the debt). You must also send a copy of the Statement of Intention form to your vehicle lender.

This same procedure applies if you're currently leasing your vehicle; you'll either reject or assume the lease and make this intention clear by filing the Statement of Intention form along with your bankruptcy papers.

In tomorrow's post we'll examine your options in this regard more in depth.

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As a Bankruptcy Attorney in Contra Costa County I closely observe the progress of loan modifications in the area.

In the past, courts often rubber-stamped foreclosure actions in favor of lenders, such as banks and mortgage companies. There was often little a homeowner could do to challenge a foreclosure action. However, one result of our nation's housing crisis has been a shift in sympathies on the part of the government and legal community to the plight of the homeowner.

What accounts for this shift in attitude?

The main reason decision-makers have had to re-assess how they approach foreclosure actions is that ample evidence of fraudulent lending practices has surfaced in recent years. The unsavory schemes employed by predatory lenders have shocked the conscience of lawmakers and laypeople alike. As a result, courts are now more likely to take the attitude that they have to protect the little guy in the face of all this fraud.

What is the impact on you the homeowner of this change in attitude?

The renewed emphasis on homeowners' rights means that now many people can successfully challenge the foreclosure actions against them. In the days to come we'll examine some of the more common defenses employed by homeowners facing foreclosure.

As a bankruptcy attorney in Walnut Creek I keep up to date on loan modification programs implemented by the banks and by the government.

Walnut Creek Bankruptcy Attorney on Obama Plan issues

The Obama administration has been active in implementing programs designed to reduce the amount of home foreclosures and lessen the impact of the housing crisis on our nation's economy. One of the first programs the administration unveiled was called FHASecure. The FHA is the Federal Housing Administration and this plan was designed to offer refinancing to homeowners who meet certain criteria.

First, the FHA will examine your history of mortgage payments. They'll be most interested in your payment history during the time in which your teaser rates were still in effect. A track record of timely payments during this period will weigh in your favor.

Second, the FHA will look at when your interest rates re-set. The FHASecure program is intended for people who saw they're interest rates re-set in the period from June 2005 to December 2008.

Third, they'll want to see a history of steady employment.

Fourth, they'll want to see that you are currently earning enough to cover your mortgage payments.

Lastly, this program was designed for people who have at least 3% equity in their home. This may be the most difficult obstacle to overcome, since many people have negative equity in their home (meaning they owe more on the house than what they could get if they sold it). In addition, people who lost their job would not be able to qualify for this program. Keep in mind, however, that FHASecure is only one of the programs being offered to assist homeowners and more assistance is on the way.

Being a loan modification and foreclosure attorny in Walnut Creek I have met many clients over the past months who once had several hundreds of thousands of dollars in equity in their home and now face foreclosure in Walnut Creek.

If you're facing foreclosure your first step should be to figure out whether or not you can afford to stay in your home. This determination depends primarily on three factors: how much equity you have in your home, how much your mortgage payments are, and how much other debt you have. In today's post we'll look at the concept of equity.

If you currently owe $200,000 on your home, and you can sell it for $300,000, you have $100,000 of equity. If, however, you owe $200,000 and can only get $100,000 for your home, you have negative equity. Unfortunately, many homeowners today have negative equity. People also refer to this situation as being under water.

You probably know how much you currently owe on your home. Let's look at how you can assess what your home is worth.

Most estimates of house values are based on what similar houses are going for in the same neighborhood. Two websites that specialize in providing this information are www.zillow.com and www.housevalue.com. In addition, you can turn to real estate agents in your area to get an estimate of the value of home.
In reality, however, it has become increasingly difficult to gage property values in the midst of our nation's housing crisis. One reason is that in many neighborhoods there is very little selling activity. Another is that foreclosed homes often sell for a fraction of what they would sell for normally. Ultimately, an item is only worth that amount that another person is willing to pay for it. So, the only way to really know what your home is worth is to put it on the market and see how much you're offered.

As a foreclosure and loan modification attorney in Contra Costa I am faced with complicated legal decisions on a daily basis. Foreclosures in Contra Costa, Solano and Sacramento County have increased steadily.

n today's post we'll look at the options that are available to people who face foreclosure.

In the U.S. today millions of homeowners are facing foreclosure. This phenomenon can have a devastating impact on families and communities alike. If your home is foreclosed on it will damage your credit rating and make it extremely hard to purchase another home in the near future. Also, lenders are within their rights to sue homeowners if the profits from the foreclosure sale fail to cover the amount the homeowners still owe on their loan.

So what options are available for people facing foreclosure? There are several. First, you can attempt to negotiate with the lender. Second, you can seek government aid. Third, you can file for bankruptcy. Fourth, you can attempt to sell your home yourself. Fifth, you can transfer the deed of your home to your lender.

As you can see there are a number of ways to navigate a possible foreclosure. However, many people in this situation simply walk away from their homes. This is sad because, especially today, there are government aid programs available to distressed homeowners and lenders are more open to negotiation than ever.

Lastly, whichever strategy you decide to pursue, the most important thing is to act fast to ensure you have the best chance at saving your home.

In today's post we'll continue to examine the concept of the bankruptcy estate.
Being an East Bay Bankruptcy Lawyer I often have to examine what is part of the bankruptcy etate and what is not.
Last week we began taking a look at what kinds of property are included in your bankruptcy estate (the property which is subject to the court's control once you file for bankruptcy).

Today we'll look at another form of property which is included in your bankruptcy estate which some people may overlook - property due to you but not yet in your possession.

When you file for bankruptcy you must itemize all your property. What if you anticipate receiving certain property at a future date? Will this property be considered part of your bankruptcy estate and thus included on your bankruptcy forms? The answer is yes.

If you are legally entitled to receive property or funds when you file for bankruptcy these assets are considered part of your bankruptcy estate, regardless of whether you currently possess them.

Here are some examples of property which fall into this category:

1) Wages earned but not yet received;

2) Life insurance proceeds (if the decedent had died at the time of filing);

3) An inheritance payment (if the decedent had died at the time of filing);

4) Money in an accounts receivable account.

The main issue is when the legal claim to the property arose. If it arose before you file for bankruptcy this prospective property must be listed in your schedules. Remember, however, it's just your job to list all such property. It's the trustee's job to recover the property should this action be required.

As a Sacramento Bankruptcy Lawyer I often talk to my clients about what is part of the bankruptcy.
In today's post we'll continue to examine the concept of the bankruptcy estate. Last week we began taking a look at what kinds of property are included in your bankruptcy estate (the property which is subject to the court's control once you file for bankruptcy).

Today we'll look at another type of property which is included in the bankruptcy estate - property recently given away.

People considering bankruptcy often consider giving away property to friends or family before they actually file. This is done in the hopes of eluding the reach of the bankruptcy court and benefiting loved ones in lieu of creditors. This is an imprudent action.

When you file for bankruptcy you must itemize all property transactions entered into in the last two years before filing. Intentionally leaving out a transaction will be considered perjury. In addition, if it comes to light that you didn't get fair market value for the item in question the trustee assigned to your case can recapture the property and sell it in order to compensate your creditors.

The bankruptcy system exists to help out essentially honest people who made financial mistakes. However, the court comes down hard on people trying to game the system. Remember, it's no crime to sell or give away property before filing for bankruptcy. But all such transactions must be listed with complete accuracy. Then at least you'll be able to rest easy in the knowledge that you've completed your part of the bargain.

Earlier this week we discussed the concept of the bankruptcy estate. Your bankruptcy estate, you may recall, is that property which is subject to the court's control once you file for bankruptcy. It includes property you own, whether or not you actually possess it.

The concept of the bankruptcy estate is fairly easy to understand. It gets a little tricky, however, when you place property in a trust for the benefit of another person or entity.

A trust is an estate planning device which delineates how certain property will be disbursed. Basically, one person (the grantor) sets aside property for the benefit of another (the beneficiary). The person who oversees the distribution of the property is known as the trustee.

Whether or not the trust you set up will be considered part of your bankruptcy estate depends on whether you set up a revocable or irrevocable trust. A revocable trust is one which the grantor is entitled to revoke. If, for instance, you set up a trust for your son but your circumstances change and you once again need the property contained in the trust, you'll be able to get it if the trust is revocable. In general, revocable trusts are considered part of the grantor's bankruptcy estate.

An irrevocable trust, on the other hand, is one that the grantor is not entitled to dissolve. It remains in effect until the property contained in the trust is depleted. An irrevocable trust will not be considered part of the grantor's bankruptcy estate. The only exception is if the court determines the trust was set up in order to shield certain assets from creditors.

Earlier this week we discussed the concept of the bankruptcy estate. Your bankruptcy estate, you may recall, is that property which is subject to the court's control once you file for bankruptcy. It includes nearly all property in which you have ownership rights.

Whether or not an item of property is actually in your possession is irrelevant for the purpose of determining whether or not it will be included in your bankruptcy estate. For example, if you own stock options this asset is not in your hands but you still retain ownership rights over them and they will be subject to the court's control once you file.

The same goes for property you've loaned to someone else. As long as you have the power to reclaim the property it will be deemed part of your bankruptcy estate.

Conversely, if someone has loaned an item to you this property will not be considered a part of your bankruptcy estate since you do not have rights of ownership over it.

You may feel uneasy knowing that virtually all your assets are deemed part of your bankruptcy estate and will be subject to the court's control once you file for bankruptcy. Keep in mind, however, that most people won't have to give up much personal property due to the state and federal exemptions that cover these assets - a topic for another day.

Oakland Bankruptcy and Foreclosure Lawyer Examines Important Issues Surrounding Foreclosure Sales

In today's post we'll look at the two types of foreclosure practiced in the U.S. today.
Judicial Foreclosure
Basically two types of foreclosure are practiced in the U.S. today - and Non-Judicial Foreclosure. State law applies to this area and states are free to adopt either system.

In Judicial Foreclosure states (such as Arizona), lenders must sue home-owners in order to foreclose on their property. Foreclosures in these states typically take several months to finalize.

In states practicing Non-Judicial Foreclosure (such as California) the time required to foreclose on a house is much less. This is because in these states it's not necessary for the lender to go to court to initiate the foreclosure process.

It's the Deed of Trust that allows the lender to avoid the judicial process. When you purchase a home in a non-judicial foreclosure state you sign two documents: the Promissory Note and the Deed of Trust. The deed transforms the note into a debt secured by collateral - your home. When you sign the deed you give the lender a legal claim to your home in case you default. This saves the lender from having to go to court in order to foreclose on your home.

Homeowners in California should be aware that they live in a non-judicial foreclosure state and that the foreclosure process can be relatively quick. If you've missed a couple payments you should anticipate that the lender may initiate foreclosure on your home.

As Foreclosure Attorneys in Sacramento we handle all foreclosure prevention actions.

In today's post we'll examine the fundamentals of foreclosure sales.

When a borrower falls behind on his or her mortgage payments, a lender may foreclose on the house. This means that the lender will sell the house and utilize the proceeds of the sale to satisfy the debt incurred by the borrower. The lender is entitled to this remedy based on the terms of the loan.

Perhaps the only consolation for a borrower in this position is that the foreclosure process takes time. In California, for example, a lender must provide a home owner three months' notice at a minimum before scheduling a foreclosure sale. In addition, the foreclosure process will usually not begin until the owner misses two or three payments. Thus, while an impending foreclosure is a daunting prospect, the process provides enough time for the borrower to devise a strategy to deal with the coming storm.

We'll examine some common strategies for avoiding an impending foreclosure in upcoming articles. In the meantime, keep in mind that several courses of action are available to home owners to either put off foreclosure for as long as possible or avoid the sale outright.

This post begins a series of articles on a pivotal issue in bankruptcy law - property.

Property is a central consideration to each party involved in a bankruptcy case. For the debtor, the goal is to keep as much property as possible. Creditors, on the other hand, would love to see the debtors' property sold off in order to satisfy their debts with them. This tension underlies all bankruptcy proceedings, from Chapter 7 and 13 cases involving individual debtors to Chapter 11 reorganizations of giant corporations.

The bankruptcy estate provides a good starting point for understanding how property is dealt with in a typical Chapter 7 case. Think of your property as being contained in two baskets. In the first basket is property which the bankruptcy court can get at and sell for the purposes of paying off your creditors. In the second basket is property which is beyond the reach of the bankruptcy court. When you file for bankruptcy, the court will look to the first basket. These salable assets are referred to as your bankruptcy estate.

The other basket (the non-saleable assets) contains property which is not within your bankruptcy estate and thus cannot be reached by the bankruptcy court. Some examples of assets not included in your bankruptcy estate include pensions and retirement funds, education accounts, most property obtained after you file for bankruptcy, and property which you possess but do not own.

As you can see, almost everything is included within the bankruptcy estate. In our example, the first basket would be filled to the brim with assets and the second would be almost empty. Fortunately, however, most people are able to hang on to almost all their property despite having to file for bankruptcy. We'll examine why this is the case in upcoming articles.

In this post we'll continue our look at the intersection of bankruptcy and landlord/tenant law and the issues that primarily affect renters.

In our last post we examined how the automatic stay can prevent landlords from evicting renters while their case is being decided by the bankruptcy court. We discussed how the automatic stay will apply unless (1) your landlord obtained a judgment for possession before your case was filed, or (2) you used certain controlled substances on the premises or otherwise endangered the property.

Unfortunately, landlords can petition the bankruptcy judge overseeing your case for a removal of the automatic stay. This is referred to as "lifting the stay". Landlords have this right and judges are often sympathetic to their requests in this regard. Why is this?

The reason is that in the view of the law your eviction will not affect your property for the purposes of bankruptcy. Remember that when you file for bankruptcy, the trustee takes a hard look at your property to see what if anything can be converted into cash in order to pay your creditors. Your tenancy cannot be converted into cash. Since it doesn't technically affect your case courts often allow landlords to enforce their property rights.

Fortunately, however, many landlords do not have counsel and do not realize they have the right to ask the judge to lift the automatic stay.

As a Walnut Creek bankruptcy lawyer I get more and more clients from the contra costa area who are faced with evictions.

For the next few posts I will be examining the issue of evictions and how bankruptcy can intersect with landlord/tenant law.

If you've been following these posts you may remember that one of the great benefits of bankruptcy is the imposition of the automatic stay. The automatic stay acts as a shield against further harassment from your creditors once your case is filed. It effectively calls a time out, freezing the status quo of your financial situation for the duration of your case.

For renters, the automatic stay can be a god-send since it can prevent evictions in cases where the eviction action is based on general allegations such as non-payment of rent.

But there are a couple of exceptions to this rule, whereby the landlord may evict a tenant despite the existence of the automatic stay.

First, your landlord could evict you if he or she obtained a judgment for possession of the premises before you filed for bankruptcy. Second, your landlord could evict you if he or she can prove you've engaged in the use of certain controlled substances on the premises or have otherwise endangered the property. These are exceptions to the rule that debtors who file for bankruptcy are protected from eviction actions through the imposition of the automatic stay. Remember, however, that there are often exceptions to the exceptions to the rules and this is why it often makes sense to consult an attorney when facing eviction.