Member of the National Association
of Consumer Bankruptcy Attorneys
Member of Legal Services
of Hudson Valley
of Hudson Valley
Member of the Hudson Valley Bankruptcy Bar Association
Member of the Rockland
County Bar Association
County Bar Association
ARTICLES
The Law Offices of Allen A. Kolber, Esq.
Rockland County Office
|
Queens County Office
|
WHEN DO YOU REFER YOUR CLIENT TO A BANKRUPTCY ATTORNEY?
Your typical client in financial distress will come to you with a wide array of financial challenges. They may have credit card debt, they may be in foreclosure, they may have high checking account overdrafts, or they may be personal guarantors on a business line of credit or commercial lease.
Although a client's first inclination would be to "work out" each financial problem separately, how do you know when to advise a client that he may be able to sweep all of his financial debt into one bankruptcy case?
A Chapter 7 bankruptcy case is designed to discharge most consumer and individual debt.
A Chapter 13 bankruptcy case is designed to protect your assets (your home and business) while paying only a portion of your debt and discharging the remaining debt.
In the past two years, the most common consumer and individual debts that have been discharged by my clients include:
Although a client's first inclination would be to "work out" each financial problem separately, how do you know when to advise a client that he may be able to sweep all of his financial debt into one bankruptcy case?
A Chapter 7 bankruptcy case is designed to discharge most consumer and individual debt.
A Chapter 13 bankruptcy case is designed to protect your assets (your home and business) while paying only a portion of your debt and discharging the remaining debt.
In the past two years, the most common consumer and individual debts that have been discharged by my clients include:
- Credit card debt
- Foreclosure deficiencies
- Medical bills
- Personal lines of credit
- Personal guaranties on business lines of credit and commercial leases
The following debts are usually not dischargeable in bankruptcy:
- Recent tax debt
- Student loans
- Alimony or Child Support
- Criminal penalties and restitution
- Fraudulent transfers of assets
The following assets may be wholly or partially protected in either a Chapter 7 or a Chapter 13 bankruptcy case:
- Pensions and IRA's
- $50,000 worth of home equity per spouse
- Certain automobiles
- Bank accounts
- Personal injury settlements
Protecting a client's assets while discharging his debts can be a complex balancing act. Although it may make sense to deposit $100,000 into an IRA or Trust to escape a client's creditors, such an act could jeopardize a Bankruptcy case and even lead a Trustee to recapture the assets and deliver them straight to creditors.
Many times, a global solution to a client's financial situation is preferable to a piece-meal solution. Often, filing a Bankruptcy case provides that global solution. Therefore, whether you are an accountant or an attorney, you will be able to counsel your clients more effectively regarding their financial crises.
Many times, a global solution to a client's financial situation is preferable to a piece-meal solution. Often, filing a Bankruptcy case provides that global solution. Therefore, whether you are an accountant or an attorney, you will be able to counsel your clients more effectively regarding their financial crises.
