When you are about to file bankruptcy it is a great idea to change banks

A bank is allowed to give itself for the money you owe them by the money you have in accounts held by them. For example if you have money in Bank of America and you have a equity loan, signature line or a mortgage they can use the money you have in their accounts and take themselves. Credit Unions are quick to do this too one of the quickest is America First in Utah. One thing a credit union will do that banks cannot do is use money in the accounts to pay the credit unions credit card accounts. It is a great idea to get your money out of banks and credit unions you owe money to if you think you are not going to be able to keep current on your obligations at that particular bank or credit union. If you have money in a Wells Fargo even if you don’t owe them any money, Wells Fargo will freeze your bank account when they find out about the bankruptcy. They think bankruptcy law requires them to do this even though no other bank thinks that way. It is a great idea to close your Wells Fargo Bank account if you are facing bankruptcy. Once a creditor has a judgment against you they can garnish your bank account. Creditors will look at the last check you wrote them and they will send garnishment papers to that bank. It is not fun to have your bank accounts garnished so If you think a creditor has a judgment against you do not keep more money then you have to in your bank accounts. For more information on bankruptcy please go tohttp://www.paulbensonlaw.com/. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

When you are about to file bankruptcy it is a great idea to change banks

A bank is allowed to give itself for the money you owe them by the money you have in accounts held by them. For example if you have money in Bank of America and you have a equity loan, signature line or a mortgage they can use the money you have in their accounts and take themselves. Credit Unions are quick to do this too one of the quickest is America First in Utah. One thing a credit union will do that banks cannot do is use money in the accounts to pay the credit unions credit card accounts. It is a great idea to get your money out of banks and credit unions you owe money to if you think you are not going to be able to keep current on your obligations at that particular bank or credit union. If you have money in a Wells Fargo even if you don’t owe them any money, Wells Fargo will freeze your bank account when they find out about the bankruptcy. They think bankruptcy law requires them to do this even though no other bank thinks that way. It is a great idea to close your Wells Fargo Bank account if you are facing bankruptcy. Once a creditor has a judgment against you they can garnish your bank account. Creditors will look at the last check you wrote them and they will send garnishment papers to that bank. It is not fun to have your bank accounts garnished so If you think a creditor has a judgment against you do not keep more money then you have to in your bank accounts. For more information on bankruptcy please go tohttp://www.paulbensonlaw.com/. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

Mortgages and Bankruptcy credit reporting after a Bankruptcy should you sign a reafermation agreement on your mortgage and what are your bankruptcy options

I have heard many questions regarding mortgages and bankruptcy and credit reporting.I thoughtI'd give some legal background to provide more understanding to those who have questions, and help to clarify. A mortgage is actually made up of two different legal documents that you sign when you get the mortgage. One is the Mortgage or Deed of Trust as it's known in some states, and one is the Note. Each document has language in it that says it is to be read and works in conjunction with the other. Each document has different legal effects to the creditor and consequences to you, the borrower. The Mortgage or Deed of Trust is the document giving the mortgage company the right to foreclose on your home if you default in any way under the Mortgage or Note, because it contains language securing the loan they give you mortgage against your home, so that if you don't pay the loan back to them pursuant to the terms of the Mortgage and Note, they can take your home because of your default. The Note is your personal promise to repay the loan. Signing the Note renders you personally, legally responsible to pay the loan back to the mortgage company pursuant to the terms of the Mortgage and Note. If you default and stop making your payments, or default in another way under these contracts, the mortgage company can foreclose on you under the Mortgage, or sue you under the Note for the total amount owed, or do both foreclose and then sue you for any balance remaining owed after the foreclosure sale. When you file bankruptcy and receive a discharge, the Note is the actual debt relating to the mortgage, and therefore is discharged in the bankruptcy along with the rest of your dischargeable debts. The Mortgage security interest is unaffected. So, if you default on your mortgage, the mortgage company can foreclose, but cannot sue you under the Note for any amount, since the Note has been discharged. This is why mortgage companies will report your mortgage to the bureaus after a bankruptcy discharge as $0 balance owed discharged in bankruptcy. This is legally correct, because the bankruptcy has discharged your personal liability on the Note and responsibility to pay the Note. So, it will continue to report this way, even if you are making your payments. If you have reaffirmed the mortgage, then you are actually reaffirming the Note (your personal legal responsibility to pay), and the mortgage company should then report your correct balance and payment history after your bankruptcy discharge. I personally tell my clients never to do so, as you are reinstating your legal, personal responsibility to pay the Note, and giving the mortgage company the ability to sue you under the Note should a future event happen that causes you to default on your mortgage payments. Once a debt is reaffirmed it can never be discharged. Further, the bankruptcy law doesn't require reaffirmation agreements on mortgages. So, a mortgage company cannot foreclose on you for not signing one (unless there is language in the Mortgage or Note saying otherwise, but I've never seen that). Remember that a bankruptcy discharge doesn't affect the mortgage company's ability to foreclose. So, if you want to keep your home, make sure to keep making your payments. There are instances when a mortgage company may foreclose even if you're current in your mortgage payments, because in some instances the mere act of filing bankruptcy can be seen as a default under the terms of the Note and Mortgage. However, this is rare and I personally have never seen it happen. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

Chapter 13 bankruptcy laws and credit reporting agencies

Chapter thirteen can be bad on your credit. After five years of Chapter 13 bankruptcy, your credit will still not improve. Why is that? About half the creditors you owe money to, will have given you 5 more years of terrible credit. They are not supposed to do that but hey do it anyway. For years, the credit reporting agencies had no rules on how chapter thirteen should show on your credit report. But they corrected that, finally, in December 2009. In December 2009 the credit reporting agencies told the credit card companies, and other creditors what to do when a Chapter 13 plan is approved. They said that once the Chapter 13 plan is confirmed, creditors can’t keep reporting you as past due. And they have to reduce the balance on your credit report down to what the judge said you had to pay. The credit bureaus did this because of a case that a Wisconsin Bankruptcy judges ruling in 2008. So far, even with a court decision in 2008 and new credit reporting rules in 2009, about half the creditors are not doing what they are supposed to do. I saw that one the credit report of one of my clients, Sara. (Not her real name.) Sara had to file a chapter thirteen to catch up the mortgage on her home. When things at her job got slow, Sara got behind, and she needed Chapter 13 to give her time to catch up. Two years into her five year Chapter 13 plan, Sara’s car broke down. She still needed to get to work, so she asked the bankruptcy Judge for permission to borrow money to buy a used car. The Judge was glad to give her permission to borrow $5000 to buy a used car. But when she went to get a car, 25% interest was the best she could do. No choice, she paid it. What was the problem with her credit report? Apple Federal Credit Union, Capital One, and Capital One Auto had reported her as late every month since she filed Chapter 13 bankruptcy in June 2009. When she bought a car in May 2011, she had two years of being late every month with them. Chase, HSBC and Dell stopped reporting in June 2009-the same way they would have in a Chapter 7. So her last reported late payment on those three accounts was two years old when she went to buy the car. Sara had done what she should do to get back to good credit. She had three new, current credit cards in good standing-paid in full every month, never late. Capital One, First Premier, and HSBC. If all Sara had was three current credit cards, two years after a chapter 7 bankruptcy, she’d have probably been below 10%. That difference, on a $5000 car loan, is $1885. Call each of the big three credit bureaus and order your report to see if the companies are following the new chapter 13 bankruptcy laws and reporting the correct information. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

If you are filing for bankruptcy when is it the correct time to move out of your house after a bankruptcy?

If you are filing for bankruptcy when is the best time to leave out of the house after filing bankruptcy?

1. When you know you can’t afford it? 2. When you fall three months behind? 3. When the bank tells you your house will go to foreclosure? 4. Right before you file bankruptcy? 5. Right after you file bankruptcy? 6. None of the above. The answer is none of the above. Moving from the house before you have to, can be a very costly mistake. Especially if you have a home owner or condo association. This is a common bankruptcy questions. When you move out-even if you file bankruptcy-you still own the house. You are responsible. You are responsible if there’s an accident. You are responsible for zoning. You are responsible for paying the association. You are responsible until your name is not on the tittle. Those after bankruptcy association payments are after bankruptcy debts. That means, they are obligation. I’m seeing people who quit paying and filed bankruptcy; and four months later the bank has foreclosed them. I’m also seeing people who stopped paying and filed bankruptcy in 2009 and the bank still has not foreclosed. If you are still dwelling there, two years for free (except for the association) is a good thing. If you move out and pay rent somewhere, two years of still paying that home owner association-that’s a real frustration. When people talk to me about filing bankruptcy and giving up the house, I tell them, don’t move out! If you have already moved out, rent it! Before therecent economic crisis mortgage companies were quick to foreclose. Five months after you stopped paying, you were foreclosed. In the sixth month, if you hadn’t moved out, you would be evicted. Filing bankruptcy right before the foreclosure would get you three more months, but that’s all. This still happens but a lot of times it doesn’t. There’s no way to see the future when the foreclosure will happen. Some of the reasons foreclosures are slow have been in the news. The whole loan modification thing paperwork problems the fact that the foreclosure lawyers can’t keep up with the volume. Some delay is just an investment decision by the mortgage companies. Suppose there are thirty houses in a little neighborhood and ten of those had mortgages with a bank I’ll call Big Bank. Two of those ten have already filed bankruptcy and gone to foreclosure. Big Bank fixed one up and sold it; the other is sitting empty. Seven are current; and the last one is yours-you just filed bankruptcy and you are five months behind. You and your eight neighbors owe $225,000 on the mortgage and the last house Galaxy fixed up and actually sold went for $110,000. The best offer they have on the one sitting empty was $101,000 and they figure if they have to sell your house too they’d be lucky to get $95,000. Well, $95,000 is better than nothing, right? Not necessarily. Big Bank is worried about your seven neighbors who are still paying. Those families ask themselves, every month or maybe every week, why are we still paying a $225,000 mortgage on a $110,000 house? When your house sells for $95,000, Big Bank figures one of your seven neighbors will say, that’s it! That neighbor stops paying, files bankruptcy, and now they have another house on their hands. Big Bank would rather have you sit in your house, for a while, then tell everyone in the neighborhood that the houses they thought were worth $110,000 have now dropped down to $95,000. Now I said at the beginning, you should not move out until there has been a foreclosure. As your bankruptcy lawyer, that’s easy for me to say; it’s harder for you to do. Because you need to have a place to live lined up. But if you panic and move out before you have to, you could end up paying the association on an empty house for another six months or a year. Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

Bankruptcy should not come with discriminationprotection is found in the Bankruptcy Code

Not having a job is one of the primary causes of bankruptcy and the not knowingof not being able to find a job after filing a bankruptcy may kep some people from getting the help they need by seeking safty under the bankruptcy code. Somepotential employers don’t like employing someone who taken out bankruptcy. Some employers will bring the question of how responsible you can be if you have to file bankruptcy. There are many familys who may have been treated unfairly because of discrimination because you have filed bankruptcy. Many people are do not relies that there is a section in the bankruptcy code that stops against the discrimination by such employers. This is found in 11 U.S.C § 525: Protection against discriminatory treatment. It states a Governmental unit “may not deny, revoke, suspend, or refuse to renew a license, permit, charter, franchise, or other similar grant to, conditions such a grant to, discriminate with respect to such a grant against, deny employment to, terminate the employment of, or discriminate with respect to employment against, a person that is or has been a debtor” under the Bankruptcy Act, or who was insolvent before or during such a case. This code section helps their rights if they are fired or kept from employment for the reason of filing a bankruptcy. The code goes on to even mention the treatments from public employers “No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt.” The private employer should not discriminate from you either on the basis of having filed a bankruptcy. People going through financial problems often file for bankruptcy in order to acquire financial rebirth. The main motive to file bankruptcy is to have a fresh start by giving new opportunity to the filers. The section 525 protections against discrimination helps ensure that people going through a bankruptcy process can retain their jobs and therefore avoid incurring further debts.Paul Benson is an attorney in Utah who practices Bankruptcy his web site is www.paulbensonlaw.com

Bankruptcy Basics in Utah in a Chapter 7 and Chapter 13 Bankruptcy

There are actually five different types of bankruptcy. Chapters 7, 9, 11, 12, and 13. Most consumers need only worry about chapter 7 or chapter 13. Generally, if you want to just wipe out all your debt (with exceptions like student loans that cannot be wiped out) and start over financially, you need a chapter 7. On the other hand if you want to avoid foreclosure and pay your mortgage arrears or keep most or all of your assets or pay back taxes, then you need the chapter 13 variety bankruptcy. Bankruptcy is a way to temporarily stop, and later prevent, all debt collection actions for debts you had at the time you filed your bankruptcy petition. Once a person files for bankruptcy, the federal court grants an “automatic stay.” This prevents creditors from attempting to collect on any outstanding debts. Creditors may petition the court for relief from the automatic stay. Often, creditors whose loans are secured by property are permitted to take possession of that property. In Utah you are permitted to keep certain property through a chapter seven bankruptcy. They are such things as your car as long as there is no more than $2500.00 in equity, your home as long as there is no more than $20,000.00 in equity. These amounts can double if you are filing a joint bankruptcy. The Bankruptcy court will allow you to keep other property through the bankruptcy process. In a chapter thirteen bankruptcies you are generally allowed to keep your property but items you have valued above the exemption amounts you will have to pay that valued to the creditors during the life of your chapter thirteen plan. Bankruptcy is a great tool to help people get back on track in life.Paul Benson is an attorney insalt lake City and Ogden Utah who practices Bankruptcy his web site is www.paulbensonlaw.com please contact him if you have any questions.