|
Ley de Quiebras Slide 1: New Combined Welcome to our law firm. We hope we can help you with what may be a difficult situation. We have prepared this brief presentation to determine whether filing a bankruptcy case is in your best interest. In the event you determine to go ahead with the filing, this presentation will serve as a roadmap of what you can expect from the bankruptcy process. Slide 2: New Combined Bankruptcy laws in this country were written to help debtors avoid certain unfair situations relating to the use of credit. Due to unexpected events such as medical expenses, loss of job, accidents, overuse of credit, family needs and other unplanned circumstances, you may have found yourself in a difficult situation. Please know that we are here to help. Bankruptcy may stop collection calls, foreclosures, wage garnishments, and lawsuits. Bankruptcy can also be helpful in providing a fresh start after a rough ride. However, it is a very serious matter and it can bring with it consequences that are not always pleasant. Slide 3: New Combined When faced with financial difficulties ignoring or avoiding the problem will not help. Credit counseling only services provide suggestions or plans for dealing with financial problems. Seeking bankruptcy relief is also an option, although it is one that should be taken with a complete analysis of your financial situation by a competent bankruptcy attorney. Our office can help you decide whether such a step makes sense in your situation. Should you choose to seek protection under the Federal bankruptcy laws, there are several different chapters which may be available, each of which may have particular advantages and disadvantages. Generally, individuals or families will consider Chapter 7 or Chapter 13. In rare instances, Chapter 11 may make sense; although it is generally used by businesses. Owners of family farms may choose to use Chapter 12, which is specially configured to help small agribusiness enterprises. What follows is a brief description of the various chapters of bankruptcy and the other aspects that are included in the bankruptcy process. Slide 4: New Combined Chapter 7 is a commonly used process that allows honest debtors to get a fresh financial start. It may eliminate most kinds of unsecured debt. Examples include, credit cards, medical bills, most personal loans, and deficiencies on repossessed vehicles. It is our goal to help you keep you home, car, and other personal belongings important to you. However, it may require you to surrender non-exempt assets to a trustee for the benefit of creditors, but we can discuss that further with you. It usually takes about 100 days from start to finish. It requires only one short hearing where you must answer questions from a trustee and a creditor or two. Slide 5: New Combined Chapter 7 eligibility is easy to establish. You must file your case in the district where you have lived for the longer portion of the last 180 days. We can explain this further if you have any questions. Also you cannot have received a bankruptcy discharge within the last eight years. Your income must be less than the state median for your state, or, certain debt to income ratios must exist. In addition, mandatory credit counseling is required from an "approved" agency within 180 prior to filing bankruptcy. Slide 6: New Combined Chapter 11 cases are generally used by businesses and ironically they often cost hundreds of thousands of dollars to successfully complete. Airlines, departments stores, hospitals and other businesses use Chapter 11 to reorganize debt and financial affairs. Only in rare situations does a Chapter 11 make sense for individuals. This is because it is generally for businesses, more costly to administer and provides a more flexible plan. Slide 7: New Combined Chapter 13 enables you to get a release of your debts like Chapter 7. However, it requires you to pay monthly payments over a 3 to 5 year period depending on your income. Also Chapter 13 is a good option if your income is to high to file a Chapter 7. Chapter 13 filing is most appropriate when the following situations exist: 1. You have non-exempt assets which you desire to retain, or 2. you owe non-dischargeable back taxes, or 3. you are several months in arrears on a home which you wish to keep, or 4. you have debt that is not or may not be dischargeable in a Chapter 7 case. If you choose a Chapter 13 case, you will have to determine what funds are available for payment to a trustee each month after determination of a reasonable budget. Slide 8: New Combined The chapter 13 plan will enable you to get current on your house payments if you want to keep it and will often enable you to lower payments on a motor vehicle and other secured debts. However, full payment of priority claims is necessary and The chapter 13 plan also requires good faith on the debtor's behalf. If income is greater than the state median, your plan must provide payments to creditors for a 5 years Slide 9: New Combined Chapter 13 eligibility is easy to establish. You must have income that is sufficient to make the monthly payments and you must file your case in the district where you have lived for the longer portion of the last 180 days. In addition, mandatory credit counseling is required from an "approved" agency within 180 prior to filing bankruptcy. Slide 10: New Combined The law requires that you disclose important information about your financial situation. This is done through schedules of assets and liabilities and a statement of your affairs. There are other requests for specific information that must be provided to the court. Our office will provide you with worksheets that you must fill out as completely as possible, then return them to be reviewed and finalized. Remember, we do not know the answers to most of the inquiries and must depend on you and your records for this information. In turn, this information will assist you in keeping your finances in order in the future. Slide 11: New Combined We CANNOT emphasize enough how important it is to be truthful and to fully disclose all requested information. The main reason people usually seek bankruptcy relief is to obtain a discharge of their debts. Failure to fully or accurately disclose all information requested may lead to a total denial of your discharge. If that occurs you will have all of the burdens of a bankruptcy and none of its benefits. Beyond that, failure to fully disclose or be truthful throughout the bankruptcy case or any other abuse of the bankruptcy process may be a federal crime. People have and do go to jail for bankruptcy abuses. This is a very serious matter. Slide 12 The bankruptcy process is comprised of a series of events. First, you file the petition and prepare the schedules and statements. Within approximately 40 days, you will be required to appear before the trustee, take an oath and answer all questions presented by the trustee and any creditors who wish to appear and inquire. Approximately 60 days later, a deadline for objecting to your discharge passes. If no party contests your discharge, the court will issue an order allowing your discharge. This means that creditors may not attempt to collect discharged debts from you anymore. It does not protect co-guarantors or other liable parties who do not file for bankruptcy. If no party objects to your discharge, the entire case should be over within approximately four (4) months. If someone objects to your discharge, then a separate court process will commence. Your full and truthful disclosure now will help determine whether such an action is possible. Remember that your lawyer is sworn to secrecy on your behalf on most everything you disclose, so there is no reason not to be completely candid about your financial past. Slide 13: New Combined As we stated, some debts cannot be forgiven through the bankruptcy process. These include those debts incurred or tainted by fraud in any fashion. Likewise, those debts resulting from willful conduct, such as assault, theft, DUI or other types of actions cannot be discharged. Many state, local and federal taxes cannot be discharged. Some can however, and if you have tax problems you may want to spend extra time talking with us about them. Likewise, bankruptcy cannot alleviate family related responsibilities including child support or alimony type payments. Neither can student loans be discharged except in very rare hardship cases. If you have recently purchased luxury items or a vacation on credit, such resulting debts may also not be dischargeable. Slide 14 New Combined: Aside from the debts specifically excepted from discharge, it is possible to lose your entire discharge so that no debts will be discharged. This can result from dishonesty associated with the process--including insufficient paperwork, deceiving a creditor, the trustee or any other court officer. If you have hidden, transferred or destroyed assets or records, the court may take away your discharge. Additionally, if you cannot explain what has happened to assets you used to have, you may jeopardize your discharge. Please don't think no one will find out about your past dealings. In this electronic age, such information is readily available to trustees and creditors. Again, explaining a difficult situation to your lawyer will not put matters any more at risk, it will only help your lawyer advise you about what you can legally do. Additionally failure to complete a personal management course will lead to a denial of discharge Slide 15 New combined Bankruptcy allows you to keep certain important and necessary assets through an exemption process. A homestead exemption is usually offered, depending on your situation, which we will discuss with you. If you are behind on house payments you will have to find a way to catch up. Beyond that there are allowed exemptions up to a certain value for automobiles, clothing, furniture, and tools of your trade. IRA's and federally chartered pension plans are usually 100% exempt. There may be many other exemption rights you have and we can determine them only after full disclosure of your assets to us. Slide 16 Who is the trustee and what is his or her role in the bankruptcy process? Trustees are independent businessmen and women, generally with excellent financial training and backgrounds. They are appointed to the local panel of trustees by the US Department of Justice in Washington DC after an extensive FBI background check. They are the watchdogs of the bankruptcy system and often hire lawyers to help them do their jobs. Trustees are regularly audited and have quite a knack for their jobs. You cannot fool them. They are good at what they do. It is their primary duty to find non-exempt assets to liquidate so creditors may be paid. If they find you have fudged on answers or otherwise been dishonest, they can seek to have your discharge denied or even revoked if such information first comes to light several years after the fact. Slide 17 The trustee searches out non-exempt assets and finds ways to turn them into cash. Next, the trustee reviews all creditor claims submitted to make sure no creditor is taking advantage of the situation. Finally, the trustee pays a dividend to creditors based on funds on hand versus the total amount of claims on file. Slide 18 Trustees also look for payments made before the bankruptcy to "preferred" creditors. These include payments or transfers to certain creditors within 90 days. In the case of related or "insider" creditors the 90 day period is extended. So if you paid off your favorite creditor or your Uncle John, the creditor or Uncle John may have to give the money back--even if it was legitimately owed. Likewise if property was transferred even as long as four years ago for less than fair consideration, the trustee can reverse such transfers as "fraudulent." You are required to disclose such transfers or payments in your schedules and statements. The failure to do so may put your discharge at risk. Slide 19 You may be tempted to think that the trustee or creditors may never find out information about hidden or transferred assets, or about other things you do not wish to have discovered. Keep in mind that trustees are often approached by unhappy creditors, former friends or even family members with important information. And even when that doesn't occur voluntarily, the trustee may force disclosure of such information by examination under oath of such people who may be aware of your financial dealings. Keeping such secrets from the court is perjury. Slide 20 Often times bankruptcy is a positive step toward credit reestablishment. Although a bankruptcy will stay on your credit record for 7 to 10 years, 24 months of regular and timely house or rental payments after bankruptcy can significantly improve your credit. Additionally, many financial institutions offer secured credit cards which allow for freedom in traveling or the benefits of credit while others do not know that the card is secured by an account you have established with funds already in the possession of the bank. Timely and regular payments can result in credit facilities being gradually restored. Aside from these there are many other ways to begin rebuilding your credit. Slide 21 We will be happy to discuss what it will cost you to file bankruptcy. In most cases we will need our fees paid prior to filing your petition. In the majority of cases this fee should be all that is necessary. However, if there are unexpected actions such as attacks on discharge, motions for stay relief, objections to exemptions and the like, it may be necessary for additional fees to be paid. As you can see, bankruptcy can provide a fresh start for honest debtors after a rough ride.
| 
