Florida Bankruptcy Lawyer Blog

Filing for Bankruptcy - These Things Are OK

2010-02-25T22:43:01Z

Bankruptcy is filled with land-mines. Therefore, if you are thinking about filing for Bankruptcy, you must be careful. We previously listed this a list of Bankruptcy Don'ts. Here is a list of Bankruptcy Do's that we give to our clients.

· Do take the bankruptcy court seriously, and avoid making any financial decisions that may make your creditors suspect you of filing in bad faith.

· Do seek bankruptcy court counsel before you file any papers, and learn your rights and options under the United States bankruptcy code.

· Do maintain timely payments on any collateralized loans that you wish to keep the collateral for. In other words, if you have a mortgage or car payment and you intend to keep the house or car, you must remain current on the payment. (Please alert us if you are not current on a collateralized loan at the time we are preparing your case for filing.)

· Do file your tax returns. Even if you know that you owe the IRS a lot of money, it is still important to file your taxes in a timely fashion. Not filing will only exacerbate the problem.

· Do reduce the amount of future income tax refunds. Refunds are routinely taken in Chapter 7 cases, and may affect plan payments in Chapter 13. If you expect to get an income tax refund , reduce your withholding so that you do not get a refund . If much of the refund id from the Earned Income Tax Credit, apply to get that available at www.irs.gov/pub.irs-fill/fw5.pdf or through your employer. For more information, see the IRS web page. Caution: Do not reduce the withholding for tax so much that you will have a big tax bill to pay.

· Do be honest and forthcoming on your bankruptcy petition. Even if it is embarrassing, it is important that your attorney knows. Any creditors not listed on your petition may not be discharged.

· Do keep our office up to date with your contact information. Mailing address, phone and email.

· Do consider increasing your 401K contribution if you have excess income and you are filing a Chapter 13.

]]> This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples and Sarasota. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog, www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.com, and the firm's mortgage modification blog.

Filing for Bankruptcy - Don't Do These Things

2010-02-25T22:32:58Z

If you are going to file for Bankruptcy or are thinking of filing for bankruptcy, you have to be careful because you don't want to take any action which may come back to bite you in the end. Here is a list of Bankruptcy Don'ts that we give to our clients.

· Don’t pay your relatives or friends in favor of your other creditors, and don’t try to transfer property out of your name and into theirs. If you do, the bankruptcy trustee may sue them on behalf of your creditors to get the money back.

· Don’t transfer any property to a relative within one year of filing your case. The Trustee may even go back five (5) years from filing the case if the transfer was for a fraudulent purpose such as avoiding paying your creditors.

· Don’t take a loan against your real estate in an effort to reduce the equity. You can often file a bankruptcy and not lose this valuable asset. If you take out a second mortgage to pay a credit card debt, you may be putting your house at risk.

· Don’t pay ahead or pay off balances early on secured loans (loans for which there is collateral).

· Don’t pay ahead or pay off balances early on unsecured loans (personal loans, medical bills, credit cards or store cards, etc.).

· Don’t attempt to sell your property for less than what it’s worth. This will not reduce the amount you eventually have to repay – and you or whoever you sold it to may end up stuck with the difference.

· Don’t run up your credit card debt prior to filing a bankruptcy. The court may view this as an attempt to exploit the bankruptcy system, and the judge may treat it accordingly.

· Don’t buy any luxury items prior to filing for bankruptcy. Any luxury items purchased within 70 days of filing for bankruptcy are viewed as non-dischargeable debt.

· Don’t take any major cash advances off of credit cards prior to filing for bankruptcy. The court may suspect that you are acting in bad faith and may refuse to discharge the debt.

· Don’t borrow, withdraw from or cash out your 401K, IRA, or ERISA qualified savings and retirement plans to pay bills. If you do, you may be liable for penalties and taxes that are not protected by the bankruptcy filing. If you don’t use these funds, you are very likely to have them to draw on after bankruptcy.

· Don’t file if you are about to receive a tax refund or inheritance. Discuss the timing with your attorney.

· Don’t transfer money in to your kid’s bank accounts. They have you as a co-signer and are subject to the same review as your bank accounts.

· Don’t get married just before filing if your spouse has high income.

· Don’t misrepresent facts to your attorney we are working to help you.

· Don’t wait until after filing to purchase a vehicle, if you know you will need a more dependable car please take care of that before filing your case. Each case is different if you need to do this please contact the attorney first.

· Don’t assume that the bankruptcy will get rid of all your debts. Some tax liabilities are non-dischargeable (basically, all tax liability accrued in the three tax years prior to filing are non-dischargeable in most circumstances). Student loans are now non-dischargeable except in cases of extreme hardship.

· Don’t tell your attorney that certain items of personal property do not belong to you if they really do belong to you.

· Don’t expect your Attorney to help you defraud the Bankruptcy Court and your creditors, it won’t happen.

· Don’t lie you will be signing the bankruptcy papers under penalty of perjury.

Bankruptcy Can Cure Real Estate Sickness

2010-02-17T12:54:24Z

As a Consumer Bankruptcy Attorney, I hear and read about what is going on with consumers who are on the front lines of economic issues. The latest twist on the Foreclosure Crisis is that inventory is hurting the real estate market. I don't know about your neck of the woods, but right here in Southwest Florida our real estate market has taken a beating. As a homeowner, I'm not too happy with the drop in prices, but I am more concerned about others who are facing multiple issues. For example, it is estimated that over 7 million homes in the United States are in trouble.

]]> Likewise, it is estimated that we will see another 3.5 to 5.5 million foreclosures. Florida is expected to be one of the hardest hit areas. Why? My answer is that Loan Modifications are not working. Even if a person is able to get a loan modification and stay in their home, it may not be enough to deal with all of their debt problems.

On a daily basis I see people who are maxed out with debt. A loan modification for them would be the equivalent of putting a band aid on a broken arm. These are good people who have lost their jobs or have had their hours cut back, etc, etc. They are good, honest and hardworking people were not able to foresee this economic nightmare. Now, they are having to make very hard choices.

If Congress changed the Bankruptcy Laws to allow people to modify their first mortgages in the Bankruptcy Court, people would have an opportunity to save their homes, cut down their debts, modify their payments schedules and pay their debts in a fair and equitable manner.

Bankruptcy is an option for many people, yet for some reason, the bankruptcy process is still shunned by the many people.

This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples and Sarasota. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog, www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.com, and the firm's mortgage modification blog.

Double Standards in Bankruptcy

2010-02-09T10:48:23Z

I was really bothered by something that I heard on the news last night, and this morning I couldn't help but voice my opinion on Bankruptcy Law Network. I know that I shouldn't listen to the news before bed, but I heard the talking head make a comment about why people file for bankruptcy and why businesses file. The joker said that when a business files for bankruptcy, it is done for one reason, and that is because it is in the best interests of the business. When an individual files for bankruptcy protection, it is because they have made bad decisions. Nothing could be further from the truth in my opinion.

So, I wrote a blog this morning titled: Bankruptcy Double Standard ? : Businesses and Individuals

]]> Please take a look at the blog and see if I came close to hitting the issues.

Taxes And Credit Cards

2010-01-09T16:06:07Z

In Florida, we pay our property taxes at the end of the year. On April 15, our federal income taxes for the previous year are due. So, within a 4 to 6 month period we may be hit with property and income taxes. In the last few years, there has been a push by the credit card companies, like Visa, American Express, Mastercard and Discover to allow you to pay your taxes with a credit card.

Don't be fooled they are not doing it because they like you. They are doing it to protect themselves. When the Bankruptcy Laws were changed in 2005, Congress added to the list on non-dischargeable debts. A non-dischargeable debt survives the bankruptcy and is still and owing after the bankruptcy discharge arrives in your mailbox. So, what did our wonderful politicians stick us with this time. Well, Congress expanded credit cards protection. While a separate statute provided the credit card companies protection when people pay income taxes and then file bankruptcy, Congress extended this protection to state and local taxes that are paid with credit cards.

]]> If you are a little behind on your savings (and who isn't), and you use a credit card to pay your state or local taxes, that debt may be excepted from the discharge if you file for bankruptcy protection. I say maybe for a reason. If you think about this for a moment, you will have given it much more thought than our representatives in Washington, and it is easy to see some potential problem spots for this legislation.

First: What if you take a cash advance on a credit card, and pay your taxes with cash. Is that debt non-dischargeable? Second: What if you have multiple credit cards, and you decide to cash advance one or two and make some payments and then use some of the money to pay your taxes? Is that non-dischargeable? Third: What if you pay your property taxes on a credit card and then continue to make payments on the card without incurring new debt? What part of the balance will be non-dischargeable? Good Question. How would you like to be the debtor or creditor at this trial?

The bottom line is this. When a credit card company is offering a convenience to the consumer, hold onto your wallet, there is usually an something in it for the credit card companies.

This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples and Sarasota. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog. Mr. Dellutri also writes for the firm's other blogs: www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.combankruptcy blog.

Department Store Credit Card Horrors

2009-12-07T13:16:26Z

This Morning I wrote a blog for the Bankrutpcy Law Network discussing why consumers shoudn't apply for a department store credit card at the register and try to save 10%.

Please click here to read it.

Don't Cave In And Apply For A Deparment Store Credit Card

This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples and Sarasota. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog. Mr. Dellutri also writes for the firm's other blogs: www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.combankruptcy blog.

Dellutri Law Group Attorneys On Fox 4 Rising

2009-10-15T14:27:29Z

Yesterday morning Attorney Carmen Dellutri and David Lampley were on Fox 4 Rising discussing the Dellutri Law Group's Mortgage Modification workshop, held at Florida Rural Legal Services in Fort Myers. For more information on when and where this workshop is held, please visit Fox 4 Rising, or contact out office at 239-939-0900 Ext. 237.

Dellutri Law Group To Start A Fair Credit Reporting Act Blog

2009-09-29T12:26:41Z

The Dellutri Law Group is getting ready to start a New Blog focusing on the Federal Fair Credit Reporting Act. Our Fair Credit Reporting Act Blog can be found at:

www.faircreditreportingactblog.com

Please check it out and tell us what you think? It should be active in 7 to 10 days. The Fair Credit Reporting Act Blog will focus on all aspects of Credit Reporting.

Bankruptcy Exemptions In Florida Part 1 - Homestead

2009-08-22T15:39:42Z

When you file for bankruptcy, a bankruptcy estate is created (11 U.S.C. 541). Individuals are allowed to protect items of personal property, cars and equity in real estate from their creditors. The process is called claiming an exemption or exemption planning. When an item is claimed as exempt, the property is theoretically removed from the bankruptcy estate and is no longer available to pay the claims of creditors.

If you are a Florida resident or have lived here for at least two years prior to the date of filing for bankruptcy protection, you must use the Florida Exemptions to protect your personal property in a Chapter 13 or a Chapter 7.

]]> Even if you are just falling behind on your bills or have lost your job and think you may have some financial troubles, knowing the Florida Exemptions is important. In a nutshell, exempt property is protected from liquidation by a creditor. So, if you have a creditor or creditors coming after you, you know that your property is safe because it is exempt.

Florida's most significant exemption is the Homestead Exemption because it is unlimited. The reason it is significant is because the protection arises in the Florida Constitution. Therefore, the homestead exemption cannot be altered without a constitutional amendment. The exemption extends to real property of 1/2 acre within a municipality and 160 acres outside a municipality. Accordingly, a person can own up to 160 acres outside of a municipality with a house with no mortgage and a creditor cannot touch the place. This exemption was limited by the 2005 Bankruptcy Amendments.

In Bankruptcy, to qualify for the unlimited Florida Homestead Exemption, you must own the residence for 40 months. Or, if you owned your current home for less than 40 months, you must have owned a previous home in Florida for 40 months total. If you have owned a home(s) in Florida for less than 40 months, then you are only allowed to exempt $136,875.00 of equity per person.

Debt To Income Ratio Explained

2009-08-18T12:23:21Z

Yesterday, Board Certified Consumer Bankruptcy Attorney Carmen Dellutri published an article on the Bankruptcy Law Network about Debt to Income Ratios. The blog put into perspective what a debt to income ratio is, the importance of your debt to income ratio and how to use a debt to income ratio to gain control over your finances.

New Check Fraud From Cash Advance Scam

2009-08-06T13:30:48Z

There is a new check fraud scam in Southwest Florida. In the past few weeks, I have received numerous emails and phone calls from clients and potential clients regarding phone calls and messages they and members of their families have received on a check fraud investigation resulting from a payday advance. The callers allege that they are “investigators” and are investigating the debtors for check fraud for a loan from a payday advance that was not paid. The callers state the debtors need to return the call to prevent criminal charges. Some callers even go as far to say that a warrant has been issued and give fake case numbers for the court where the debtors live. As you can imagine, many people become extremely frightened and upset when they hear this.

]]> The first thing you need to know is the allegations made are completely FALSE! There are no criminal charges for the inability to pay a debt. Not paying a payday advance is not check fraud. A fraudulent check can occur in situations where you issue a check on an account knowing it has insufficient funds to cover the check or forging a signature on another person’s account. When a payday advance is taken, the advancing company is loaning you money until your next payday and is getting interest (usually very high) back on the return. It is a loan, plain and simple, not a fraudulent check.

The phone calls are coming from collection agents attempting to scare people in paying back the debt. How can this misrepresentation be legal you ask – the answer is, it is NOT! Consumers have numerous protections under the law against this type of abusive and misleading debt collection. The protections arise under both federal and most state laws.

The conduct described can subject the collectors to liability for any actual damages sustained such as emotional distress, statutory damages, and punitive damages. Under the federal Fair Debt Collection Practices Act, statutory damages can reach $1,000 in addition to any actual and punitive damages. Florida law also allows for $1,000 in statutory damages and recovery of actual and punitive damages for violations of the Florida Consumer Collection Practices Act. Both of these Acts allow a debtor successful in litigation to recover attorney’s fees and costs from the abusive debt collectors. The abusive collections can also subject them to civil penalties through actions brought by state attorney generals and the Federal Trade Commission.

So if the conduct is illegal and subjects the collectors to liability, why do they do it? Because it works. Under a cost-benefit analysis, these abusive debt collection companies make a lot of money by using illegal scare tactics. If it leads to a few lawsuits, their profits make the potential liability worth it. Or, the company is so small that once it is served with a lawsuit it can quickly close shop and disappear. Therefore, the best defense against these companies and their illegal ways is the knowledge that their representations of pending criminal charges are flat out lies.

This post was submitted by Attorney David Fineman of The Dellutri Law Group, P.A.

Can I File Bankruptcy Right Away?

2009-07-21T12:29:21Z

As a Board Certified Consumer Bankruptcy Attorney, I see people considering filing for bankruptcy each and every day from Sarasota, Port Charlotte, Fort Myers, Cape Coral, Lehigh Acres and Naples. One of the most common asked questions about bankruptcy is: Can I File Bankruptcy Right Away? The answer is yes and no. Yes, because you can. No, because you cannot just file bankruptcy without a detailed analysis of your complete financial situation.

]]> The decision to file for bankruptcy protection, whether it be a Chapter 7 or Chapter 13 is not an easy decision anymore and should not be taken by the consumer very lightly. A great deal of thought and work goes into each and every petition that is filed with the United States Bankruptcy Court.

Also, please do not assume that anything is relevant to your situation, unless you have received the appropriate time, attention and legal advice from your attorney. Of course, there is a lot of "street talk" all over the internet about the ins and outs of bankruptcy. Unfortunately, there are many inaccuracies on the internet. This less than truthful information can hurt you, and it may cost you quite a bit of money.

Since the internet is not a confidential place, I strongly suggest that you consult with a Board Certified Consumer Bankruptcy Attorney personally to determine whether the issues that apply to your specific case are problems or not before you make any final decisions regarding filing for bankruptcy.

The reason many people want to file right away is because of the opportunity to take advantage of the Automatic Stay. One of my colleagues at the Bankruptcy Law Network, Cathy Moran, explains what the automatic stay is better than anyone. Yes, a reprieve from your creditors can be a powerful tool, and it can provide you with some time to catch a breath and gather your thoughts. However, if used improperly, it could also work against you.

If you are in the Fort Myers, Naples, Cape Coral, Port Charlotte or Sarasota area, feel free to give my office a call and speak to my secretary or paralegal to make an appointment.

Carmen Dellutri on ParrLegal - Bankruptcy and Dellutri Law Group

2009-06-30T22:28:01Z

Recently Carmen Dellutri was interviewed by Rachelle Grossman for Parr Legal. Parr Legal is a website developed for people to find attorneys and the consumer can watch the attorney before meeting them.

Carmen Dellutri on CNN about Medical Bill Bankruptcy

2009-06-22T22:54:30Z

Board Certified Consumer Bankruptcy Attorney, Carmen Dellutri, of Fort Myers, Florida was recently interviewed by CNN on the issue of Medical Bills and Bankruptcy.

See the video:

The interview lasted approximately 20 minutes, and only this appearance made it off the cutting room floor.

Medical Bill Bankruptcy - An Epidemic or a Pandemic?

2009-06-04T15:50:54Z

Are we all just one medical problem away from Bankruptcy?

As a Board Certified Consumer Bankruptcy Attorney, I speak with many people about filing for bankruptcy and their debts. Medical Bill bankruptcies are a very real and growing problem. Don't get me wrong, this is not a new phenomena that suddenly came to rise like the epidemic or pandemic known as swine flu. People have always had to deal with medical bills when either they or a loved one became sick or were injured. However, it seems that over the last few years, medical bill bankruptcies have been on the rise.

]]> I define a medical bill bankruptcy as a consumer bankruptcy where the medical bills incurred either directly or indirectly caused the individual to seek bankruptcy protection. Many people are forced to file for bankruptcy protection just for one illness or an injury that occurred after they lost their health insurance. Alternatively, other people file for bankruptcy after a long series of financial issues which started after a job related injury or medical problem and over time the financial hole became deeper and deeper.

Sometimes these medical bills are paid by health insurance or worker's compensation insurance, but, when a person is out of work because of a medical issue, how are they going to pay their other monthly obligations, like the mortgage, car payment, insurances, etc. What about the Dr. visits, co-pays, and prescriptions? What about the procedures that are not covered under the insurance policy? Can you imagine making a medical decision based upon whether your health insurer will cover the procedure because you cannot afford it? What if you cannot afford the procedure?

What about consumers who lose time from work because their spouse or child is sick? The stress of the illness alone will cause that person to become sick. Usually, that same individual may lose their job if they miss too much time from work. If you lose your job, you may also lose your health insurance. Even though health insurance isn't what it used to be, any health insurance is better than no health insurance. Still, many of our clients are incurring a significant amount of medical bills despite having private health insurance. They still face co-payments, sky high deductibles and non-covered procedures.

If we can learn one thing from medical bankruptcies, it should be that the health care system is broken, and it needs to be fixed. I don't know how to fix the problem, but I wish I could. I can only see how it changes people's lives forever.

Let's face it, bankruptcy is a very emotional issue. When you tack on medical bills, debt collectors hired by the medical providers, and the stress of knowing you cannot pay your doctor, it gets a bit overwhelming. Families on the brink of destruction often come into my office to discuss their horrifying experiences. No one wants to file for bankruptcy protection; however, bankruptcy provides the only glimmer of hope for many families. Bankruptcy can provide that fresh start that people need . I believe people are resilient and can bounce back from unbelievable circumstances.