Exhausting all possibilities to pay off their bills and debts comes as a shock and leaves most of individuals feeling desperate. Filing bankruptcy is the only solution they have at that point. Fortunately, bankruptcy laws are constructed as a helping hand to the debtors and should enable discharge of all or most person’s debts all together with providing a chance for a new star.
Though bankruptcy offers many benefits, it also imposes some risks and a huge responsibility. Whole lots of things are at stake. Knowing this, breaking of any law during bankruptcy process implies a long – term sever consequences. Bankruptcy frauds can be civil wrong, but frequently debtor’s fraudulent actions fall under the jurisdiction of the criminal law. If you want to know more about Medical malpractice lawyer pasadena please visit our page.
Concealing assets is probably the most common type of bankruptcy fraud. Bankruptcy estate is an official document proving the total amount of debtor’s property. In order to hide real inventory and try to keep the full value of it during bankruptcy process, individuals often submit hide or undervalue their property, convert cash into assets that cannot be identified during bankruptcy procedure or try to transfer some possessions onto some member of their family. Fraudulent disposal of property prior or after bankruptcy is also possible.
Another group of offences refers to false documentation when a person provides incomplete or false documents, makes false entries in a statement of account, falsifies written proves of affairs or fraudulently modifies claims of debts.
Refusing to answer trustee’s or creditors’ questions honestly during meetings and failing to explain debts accumulations or loss of property, are also included into wide range of abuses of bankruptcy process. Some debtors even try to bribe the court officials or anyone involved with theirs bankruptcy case.
Being aware of all the possible offences, creditors often try to protect their legal claims by early investigations, documenting of assets and their transfers, rechecking if some assets are left over or undervalued.
If it proves that the debtor has committed “white collar” crime, the court can impose civil or criminal penalties, depending of the nature of the offence. Civil penalties usually include dismissal of the case and rejecting of the debt discharge or loss of exempted property. Criminal penalties involve fines, probation or imprisonment up to 5 years of prison.
The best solution for the bankruptcy frauds is not to commit it, but if you’ve already put yourself into this serious situation, immediate consultations with an experienced criminal defense attorney are highly recommended.
Bankruptcy is a legal process of liquidation of business, if the debtor is company or liquidation of property, if the filer is and individual. Bankruptcy is filed when accumulated debts cannot be played anymore by debtor’s current income and assets. There are different types of bankruptcy, but major policy of each is to free the debtor from present overwhelming financial obligations and to help people or companies get a fresh start.
For the purpose of fresh start, every bankruptcy procedure involves the debtor education course.
Post – filing debtor education course is a step you are required to complete after filing bankruptcy and before you can receive discharge of your debts. It usually lasts for few hours and can be done in person, on the phone or as an online course. The major purpose of this course is to instruct you on how to manage your budget and incomes, how to use your credit and how to get the best out of the discharge in order to avoid future financial troubles.
In other words, it is training on how to make wiser financial decisions in future, after your bankruptcy is completed. Depending on the type of bankruptcy you filed, you are obligated to complete the course before getting discharge or before completing you last payment of repayment plan. Approved agency that provides the course will give you the certificate, as proof you have completed the course, which you have to submit to the court. The fee for the course varies, but if you cannot afford to pay it, there are ways to reduce it. For more information visit Chapter 13 Bankruptcy lawyers dallas.
The debtor education course should not be confused with the credit counseling. Credit counseling is also mandatory step within the bankruptcy procedure, but it takes place before filing and the purpose of it is to analyze the situation seeking for any alternative to bankruptcy you could use to handle your debts.
Student loans fall into a group of debts that are usually not discharged, unless the debtor or his attorney can persuade the court that they should be. Legally speaking, an individual has to prove that paying of that debt will “impose an undue hardship on you” and the court will determine whether this is true or not.
Usually, the court needs to be convinced in three major things. The first one is that financial state of the debtor, considering current incomes and expenses, is alarming and if he continues repaying the debt any further, maintaining the minimum of living standard will become impossible. Also, the debtor has to prove that it is likely to expect that this troubling situation is about to last for a significant period of time. And the last, but not the least – the court has to be persuaded that the debtor gave all of his efforts and exhausted all the possibilities to repay the debt.
If the court determines that particular case qualifies for discharge, complete amount of the debt will be discarded.
Even if the debtor’s financial situation meets the criteria for discharge of student loans, filing bankruptcy doesn’t discharge it automatically. There is a specific procedure the debtor needs to complete in order to include student loans into discharged debts. The procedure is called an adversary proceeding and it refers to a separate lawsuit filed within the bankruptcy case. Filing this proceeding may be done at the same time when filing bankruptcy. If the debtor has already filed bankruptcy petition without filing for determination of undue hardship, the bankruptcy case can be reopened without paying additional fees. Visit chapter 7 bankruptcy lawyers chicago for help.
There is another option for debtor who failed to prove undue hardship. Filing bankruptcy under the chapter 13, often called “reorganization” or rehabilitating bankruptcy, offers the debtor a possibility to repay his debts over some extended period of time, according to the repayment play. Depending on a particular situation, even the reduction of the debts is possible sometimes. During the repayment period, as long as the debtor pays determined shares in timely manner, creditors are not allowed to pull any collection actions against the debtor.