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Archive for August, 2011|Monthly archive page

Bankruptcy Protects People

In Uncategorized on August 29, 2011 at 10:08 am

People file bankruptcy to discharge unsecured debts. Bankruptcy discharge elimiates persoal liability to pay back debts. Some debts are not discharged in bankruptcy. The discharge does not eliminate liens on property. For example, a lien on a vehicle title is not removed by the bankruptcy discharge.

Bankruptcy protects people’s assets from creditors. It blocks garnishments of wages and bank accounts. Bankruptcy prevents creditors from recording judgment liens against real estate. If a creditor files a judgment lien, bankruptcy can often get rid of it.

Chapter 13 Plans Can Change

In Uncategorized on August 18, 2011 at 2:33 pm

Change Your Plans
Its possible to change the terms of your chapter 13 plan. Payment terms can, with court approval, change even after the plan is confirmed. For example, if you have a permanent change to your income, the court can approve a lower payment. There are limits to the changes possible. The plan must complete within five years, for example. Call me if you are experiencing problems with your plan payments.

Garnishments And How They Work

In Uncategorized on August 5, 2011 at 3:10 pm

Creditors can garnish your wages once they obtain a judgment from court. The judgment states the amount you owe them. The maximum total amount that can be taken from you is 25 percent of your disposable income. “Disposable pay” means the amount of money left in your paycheck after amounts required by law, like taxes, come out. However, you are always guaranteed to be left with an amount per week that is 30 times the federal minimum wage, which is now $7.25 per hour.

The government can garnish 15 percent of disposable pay to collect a defaulted student loan. They do not need a court judgment to do so.

Being subject to a garnishment is tough, but there are strategies for dealing with it. One option is to rehabilitation the loan by arranging to make payments. Another option is to consolidate out of the defaulted loan. Some people even file Chapter 13 bankruptcy cases to stop the garnishment.