Chapter 13 Bankruptcy Information

By Kurt O’Keefe, Attorney at Law on Nov 30, 2009 in General Bankruptcy Information

Bankruptcy filings–especially big ones–are often like dominoes.   Let’s say a large commercial project, like a shopping center, falls on hard times, and the developer files for bankruptcy.  Even if the bankruptcy is a Chapter 11 reorganization, which means that the company may continue to operate, and even continue to develop the shopping center, the contractors who have done the construction, the suppliers, and even the architects and engineers, may not get paid for a while, or may not get paid all they are owed.  So the general contractor also files bankruptcy.  Now the subcontractors don’t get paid, and the workers are laid off, and so on, and so on.  Even a small or medium-sized business bankruptcy can have a ripple effect. 

I recently read an article on simple things you can do to avoid bankruptcy.  This article is probably one of the best examples of why you need to consult an experienced bankruptcy attorney before deciding whether or not to file for bankruptcy.

Here are just two of the suggestions:

SUGGESTION NO. 1:  SELL YOUR BELONGINGS

Well, honestly, the suggestion was that you make a list of all of your possessions that are worth over $60.00 in value to get an idea of how you spend your money and then be prepared to sell those possessions to pay your creditors.

Gift cards are the fastest-growing retail and restaurant product to come along in the last ten years. However, there are traps for the unwary consumer.  In August 2010, a federal law will ban inactivity fees or monthly service charges on gift cards for the first year after purchase and will prohibit fees on gift cards that have been used in the past 12 months.  Since 2005, gift cards in Connecticut are not allowed to have an expiration date or a dormancy fee for inactivity.  Other states have followed suit.

As someone who represents both individuals and businesses in bankruptcy, I get lots of calls from potential clients saying that they want to file bankruptcy for their business. They are surprised when I tell them that it usually doesn’t make sense for the business to file, but that they probably will need to file personal bankruptcy. Why is this so?

The answer lies in who can get a “discharge.”

By Kurt O’Keefe, Attorney at Law on Nov 28, 2009 in General Bankruptcy Information

By Kurt O’Keefe, Attorney at Law on Nov 28, 2009 in General Bankruptcy Information

A Connecticut Bankruptcy Judge has recognized that a person in Chapter 7 may deduct car expenses on the Means Test even if there is no car loan without triggering a presumption of abuse in Bankruptcy.  Now there’s a mouthful, but what does it mean?

The Means Test was devised by the credit industry to ‘catch’ consumers filing Chapter 7 bankruptcy when they could otherwise ‘pay’ at least some of their debts in a Chapter 13 case.  Congress adopted the process of keeping consumers as slaves to their debt.  One long-standing assumption of that means test calculation was that car expenses could only be deducted from income if there was a car loan.  That is no longer the case in Connecticut.