TheFloridaBankruptcyLawBlog

Chapter 13 Mortgage Cram-Down On Multi-Family Building When Debtor Lives In One Of Units

08/31/11

Chapter 13 debtors can cram-down the value of mortgages on properties other than their principal residence. The debtor initiates the process by filing a motion to value the underlying property. If the property is under water the court will modify the mortgage to reduce the loan balance to the current property value.

A Florida bankruptcy court considered a motion to value on a debtor’s duplex. The debtor lived in one unit and rented the other unit.

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Debt Ceilings Make Chapter 13 Cram-Downs Difficult To Accomplish

08/27/11

People get excited about the prospect of cramming down mortgages on investment properties in a Chapter 13 bankruptcy. I received at least two calls this past week from people interested in using Chapter 13 to both strip a second mortgage on their homestead and reduce the mortgage balance on at least one rental property.

Sounds like a plan, but unfortunately the plan usually does not work because of Chapter 13 bankruptcy’s unsecured debt ceiling. You cannot file Chapter 13 bankruptcy if your total unsecured debt exceeds about $330,000.

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Does Owning Florida Real Estate Confer Eligibility To File Bankruptcy In Florida?

08/23/11

An attorney called me today to ask me about his client who had moved from Florida to Ohio a few months ago to take a new job and establish a new residence The same client still owned a piece of real property in Florida which was his former Florida homestead. The attorney understood that the client would not be eligible for Florida exemptions because the debtor no longer domiciled in Florida. The question was whether or not the client could file bankruptcy in Florida because he retained ownership of Florida property.

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Employer Can Refuse To Hire Bankruptcy Debtors

08/19/11

I have previously written posts on the subject of bankruptcy and employment. How bankruptcy can effect your employment depends upon whether you are concerned about a current employer or employment. The bankruptcy code clearly prohibits your present employer from firing you because you filed bankruptcy while employed. Whether your bankruptcy can affect future hiring is not specifically dealt with in the bankruptcy law, and at least one bankruptcy court had permitted discrimination against bankruptcy debtor by new employers in their hiring process.

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Chapter 7 Debtor's Liability For Monthly Lease Payments Due After Filing Bankruptcy

08/15/11

One of my Chapter 7  bankruptcy clients rented a house under a one year lease. The lease expires at the end of August, 2011. The client filed bankruptcy in April, 2011. The client stayed in the house and paid rent for May, June, and July. He intends to vacate the house in August at the end of the lease. The client asked me whether the landlord can sue him for money damages if he does not pay the August rent.

Lease debts have their own set of rules in bankruptcy.

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Book Deals And Movie Deals Are Not Part Of Bankruptcy Estate When Contract Is Signed

08/10/11

One of my new bankruptcy clients is a published author. His career stagnated. He piled up a large amount of unsecured debt to pay living expenses and keep his house. He just signed a substantial book deal to write a new book. His ship is not “in”, but he can see the sail on the horizon.

He has a signed contract with the publisher. When he completes his book the publisher will pay him big bucks. There is a small advance. The man wants to file Chapter 7 bankruptcy.

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Mortgage Mediation In Chapter 13 Bankruptcy Sabotaged By Lender Document Requests

08/06/11

Have you been jerked around by mortgage banks in court ordered mortgage mediation in Chapter 13 bankruptcy cases? Another local attorney spoke with me this week about how big banks are playing debtors and their attorneys in court ordered mortgage modification mediation.

The attorney’s client filed Chapter 13 in Orlando where the courts have for some time ordered mortgage lenders to participate in mediation regarding modification of Chapter 13 debtor’s home mortgages.

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Bankruptcy For Illegal Immigrants

08/02/11

Here is some interesting bankruptcy trivia discussed in a blog post by Oregon bankruptcy attorney Kent Anderson. The issue is whether an illegal immigrant can file bankruptcy in the U.S. One would suspect the answer is “no” for any number of reasons.

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Protecting Your Child's Car In Chapter 7 Bankruptcy

07/30/11

It’s getting to the point where you need a lawyer to buy a car for your child. This is certainly true for people who buy a car in their own name for their minor child to use. People consider the car be their “child’s car” not understanding that Florida law considers the car to be the parents’ asset even though the parents do not drive the car. To make matters worse, parents typically get their minor children inexpensive cars which are already paid for.

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When Bankruptcy Benefits Criminals? Comparing O.J. And Casey.

07/27/11

After reading and considering  my posts regarding legal issues in a Casey Anthony bankruptcy, an attorney sent me an email asking why O.J. did not file Chapter 7 bankruptcy. He asks why would bankruptcy work for Casey if it did not work for O.J.

Chapter 7 bankruptcy does not permit the debtor to discharge damages caused by the willful and malicious injury by the debtor to another person. This is important for the debtor only if there is a person entitled to damages and who is willing to sue for damages.

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