Insolvency Rates Are Rising
The insolvency rates in the Greater Toronto Area have been rising. In November 2019, the number of personal insolvencies in Canada grew by 8.9% with Ontario contributing the most filings out of all of the provinces and territories. Financial experts at the time expected the pattern to continue into 2020, predicting more filings across the country.
The Office of the Superintendent of Bankruptcy found that Greater Toronto saw over 1,500 insolvencies by February 2020. Consumers represented the majority of those filings, making up 1,485 out of the 1,523 total. Thats an 18% rise in filings within a year.
The climbing rates are attributed to several factors:
- Higher costs of living
- Higher rates of and delinquencies
- Stagnant wages
- Interest rate hikes
What the financial experts did not predict in 2019 was a pandemic that would rattle the globe. COVID-19 is expected to increase the number of insolvencies across the country, especially in the Greater Toronto Area.
What One Attorney Wants People To Know About Filing Bankruptcy
- 3 Minute Read
If youve ever thought of filing bankruptcy, youre not alone. From 2005 to 2017, about 12.8 million consumer bankruptcy petitions were filed in the federal courts. Bankruptcy can offer a fresh start if you feel overwhelmed with personal debt, but it also poses some common questions you should carefully consider before you file, such as:
- What is bankruptcy?
- What happens when you file bankruptcy?
- What are the types of bankruptcies?
- How much does it cost to file bankruptcy?
Bankruptcy is a legal proceeding when you cant fully re-pay your debts to your creditors. When you look for answers, make sure you get them from an expert.
Qualifications For Chapter 7
In Chapter 7 bankruptcy, if your familys income falls below the median income of Arizona, it means that you pass the means test. On the other hand, if your familys income exceeds the median income, you may still be qualified to pass the means test after you deduct a list of the allowable living expenses.
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Do You Need A Lawyer To File Bankruptcy How To Choose A Bankruptcy Lawyer
Finding the appropriate bankruptcy attorney will help you get out of your sticky position. The initial step is to recognize like youre in a difficult circumstance and cannot handle things on your own. Debtors who are seeking to settle their debts in bankruptcy court are under pressure. The legal system in this country is complicated and harsh. In other circumstances, people who register for self-representation probably wind up in a much worse predicament than they were before, losing all of their money as well as belongings. In the end, the debt isnt even paid off. Expertise is the greatest and safest option because no one desires this.
Bankruptcy attorneys specialize in two sorts of bankruptcies. Some attorneys specialize in Chapter 13 cases, while others specialize in Chapter 7 cases. Other lawyers deal with business filings under Chapter 11 cases. These are attorneys that specialize in commercial or business bankruptcy. All of these attorneys specialize in bankruptcy cases.
Do You Need A Bankruptcy Lawyer The Short Answer Is Yes
Filing personal bankruptcy without an attorney is a bit like performing your own surgery. You could always try, but it is not a good idea. Bankruptcy law allows you to file without a lawyer, but doing so can have serious negative effects on your bankruptcy case, your money, your family and your life. If you are thinking about filing bankruptcy or have questions about bankruptcy, our New Jersey bankruptcy lawyers can give you the answers you need.
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Filing Bankruptcy Without A Lawyer: Can Or Should You
It is possible to file a Chapter 7 straight bankruptcy or a Chapter 13 payment plan case without a lawyer, but before you do, there are some things you should think seriously about. This is not a decision to take lightly. If you make any missteps, you could end up worse off than you are now.
Here are some things you need to consider.
Do I Need A Lawyer To Help Me File For Bankruptcy
As it says in the instructions for official bankruptcy forms, It is extremely difficult to succeed in a Chapter 11, 12, or 13 case without an attorney. Reorganization cases are hard to get off the ground and require years of maintenance. For instance, a Chapter 7 case lasts about three months. But if it gets confirmed , a Chapter 13 case can last as long as five years.
The instructions to the official forms for individual debtors say it well. Completing the forms is only a part of the bankruptcy process. You are strongly encouraged to hire a qualified attorney not only to help you complete the forms but also to give you general advice about bankruptcy and to represent you in your bankruptcy case. If you cannot afford to pay a lawyer, you might qualify for free legal services if they are provided in your area. Contact your state or local bar association for help in obtaining free legal services or in hiring an attorney.
How Do I File Bankruptcy In Glendale Az
Filing bankruptcy can be financially, physically, and emotionally draining. At Glendale Bankruptcy Attorneys, we have extensive experience in handling successful bankruptcy cases.
Our seasoned Glendale bankruptcy attorneys can guide you throughout the step-by-step bankruptcy process and ensure the completeness and accuracy of your paperwork. Here are the steps in filing bankruptcy:
- Choose the best bankruptcy chapter for you
- Prepare all necessary financial documents
- Take a credit counseling course
- Fill out the official bankruptcy forms and file a complete paperwork
- Attend the 341 creditors meeting
- Attend the confirmation hearing and make plan payments
- File a debtors education course certificate
- Receive your debt discharge
Our Glendale bankruptcy attorneys will help you choose the best bankruptcy chapter for your financial situation. Call us today to schedule a consultation.
Chapter 13 Bankruptcies And Other Situations
While in some cases you can file bankruptcy without a lawyer, there are exceptions, depending on the type of bankruptcy. Some examples include:
- If your corporation or partnership is facing bankruptcy, you’ll need a bankruptcy lawyer.
- If you fail the Means Test because your income is too great, you may have to file a Chapter 13 bankruptcy rather than a Chapter 7. In that case, you can still file for bankruptcy without a lawyer, but it will be more difficult. That’s because Chapter 13 cases are much more complicated than Chapter 7 bankruptcies.
In addition to filling out the needed paperwork, you’ll have to create a repayment plan detailing how you plan to repay your creditors. As with Chapter 7 cases, downloading a bankruptcy forms package will help you stay organized by providing you with all the paperwork you need to file.
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Will Bankruptcy Wipe Out My Debts
Bankruptcy wipes out different types of debt like personal loans, credit card balances, medical bills, and overdue utility payments. However, not all debts can be discharged in a bankruptcy case. It depends on the bankruptcy chapter that you will file. A qualified Glendale bankruptcy lawyer can help you determine which of your debts will be eliminated in bankruptcy.
Unsecured debts such as credit card bills and medical bills are both discharged with bankruptcy filings, which means you do not have to pay these debts. On the other hand, non-dischargeable debts include student loan debt, certain tax debt, car loans, child support, and alimony. Some of the secured debts may be reduced under Chapter 13 through a cramdown, in which the approved repayment plan reduces the amount you owe.
When you file for a bankruptcy petition under Chapter 7, debts will be discharged once the bankruptcy court approves your case. If you choose to file under Chapter 13, you must continue making payments throughout your payment plan. Once you have completed your repayment plan, unsecured debts will then be eliminated.
How Do I Choose The Right Bankruptcy Chapter
Before you file for bankruptcy, it is essential to know how to choose the best bankruptcy chapter that will solve your debt problems. Most debtors declare bankruptcy under Chapter 7 or Chapter 13 bankruptcy. The most significant distinction is what happens to your assets.
Consulting a qualified Glendale bankruptcy attorney can guide you in choosing the right bankruptcy chapter, depending on your financial situation.
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Can I File Bankruptcy Without A Lawyer
Yes, you can legally file for bankruptcy without a lawyer. But should you?
Every year, thousands of Americans find themselves too broke to pay off their debts, yet unable to afford bankruptcy. It probably comes as no surprise that attorneys’ fees make up the lion’s share of bankruptcy expenses. So you might be wondering, “Do I really need a lawyer to file for bankruptcy?”
It largely depends on how complex your case is. If you own little property and don’t make a lot of money, it might be possible to file bankruptcy pro se . But while filing for bankruptcy on your own can save you money, it’s a serious undertaking. You’ll have to pull together all of your financial documentation, file a lot of paperwork on time, and communicate with your bankruptcy trustee. You’ll also need to take the time to understand the state and federal laws that apply.
In this section, you’ll find a step-by-step guide to filing for Chapter 7 bankruptcy and a few tips to help make the process as simple and painless as possible.
If You Need To File Chapter 13 Bankruptcy
There are many reasons to file a Chapter 13 bankruptcy instead of Chapter 7. You might want to file a Chapter 13 bankruptcy because you wish to catch up on mortgage arrears, get rid of your second mortgage, cram down your car loans, or pay back nondischargeable priority debts, such as back taxes or support arrears. Or maybe you make too much money to qualify for a Chapter 7 bankruptcy. No matter your reason, most Chapter 13 cases are too difficult to file on your own.
In addition to filling out the bankruptcy forms , you must also design a proposed repayment plan, which is very difficult to do without the expensive software that most attorneys use. Specific actions such as stripping your second mortgage or cramming down a car loan will require filing additional bankruptcy motions and paperwork with the court.
As a result, some attorneys limit their bankruptcy practice to Chapter 7 because they feel they are not qualified to handle Chapter 13. And, an overwhelming majority of Chapter 13 cases filed without an attorney get dismissed by the court. So if you are planning to file a Chapter 13, it is a good idea to hire a qualified attorney.
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Do I Need To Hire An Attorney To File Bankruptcy In Ohio
The bankruptcy process is a complicated one that can have long lasting financial repercussions for those filing for bankruptcy relief. While there is no law requiring a person to have an attorney when they file for bankruptcy in Ohio, having an attorney has a number of important advantages for people to consider. An attorney can help a person to get the best deal possible when filing with the court for debt relief. In fact, it would be difficult for a non-attorney to navigate the bankruptcy process without legal representation.
The primary reason that a person who is filing bankruptcy should have a lawyer is the legal experience of the lawyer. Though there are many books and online sources of information on bankruptcy, there is no substitute for real experience in a local bankruptcy court. While the bankruptcy process should be uniform across the country, each court and each judge will have ways of doing things. An experienced bankruptcy attorney can help his or her client to properly file papers with the court to get the hearing scheduled quickly and the case heard in a timely manner. Failure to comply with legal requirements can result in delays or even result in the entire bankruptcy Ohio procedure being thrown out of court.
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Why You May Want An Attorney Even If You Can Do It On Your Own
In many cases, even if you can file the bankruptcy on your own, it may still be in your best interest to hire an experienced bankruptcy attorney. If you are filing for aChapter 13 bankruptcy, you will be able to catch up on any missed car loan or mortgage payments, eliminate unsecured loans and even a second mortgage through lien stripping, and reduce the interest rate and principal balance on your car loan.
However, a Chapter 13 bankruptcy is often much more labor-intensive and complex than a Chapter 7 bankruptcy. You will have to propose a feasible repayment plan that is fair to your creditors. In addition, if you want to strip down your car loan or second mortgage, you will have to file additional paperwork.
If you have a complex Chapter 7 bankruptcy, it only makes sense to hire an attorney for a more complicated case. For a Chapter 7 bankruptcy, you should consider hiring an attorney if your income is significant enough that it may disqualify you from being able to file a Chapter 7 bankruptcy, if you have a lot of assets that could be at risk, if you own a business, if your debts may not be dischargeable through bankruptcy, if you have creditors that could challenge your discharge, or if you have recently transferred assets out of your name.
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Pro Se Only Applies To Individual Filings
As long as you are making an individual filing, you can file for bankruptcy on your own without a lawyer or a law degree yourself. This includes both types of personal bankruptcy filings as well as business filings as long as the business is not a partnership or incorporated entity.
You can NOT represent yourself in a partnership because you cant legally represent someone else without being a licensed attorney. Incorporated businesses cant be represented by the owner, so you must hire an attorney.
Of course, just because you can do something it doesnt mean that you should. Even on the official website for United States Courts it states:
While individuals can file a bankruptcy case without an attorney or pro se, it is extremely difficult to do it successfully.
What Different Types Of Bankruptcies Are There
There are two main types of bankruptcies for consumers:
Chapter 7 is a liquidation of assets followed by a discharge of debt. It is perhaps what you normally think of when you think of bankruptcy. Upon filing the bankruptcy, the Court assigns, through the US Department of Justice, an attorney called the Trustee. The Trustees job is to examine what you own and see if anything can be sold to pay any of your debt back, even if it is not the full amount. In exchange for a selling of your assets, you receive a total discharge of your debt, meaning that creditor can never take any action to collect on that debt you owe him or her ever again.
Chapter 13 is essentially a consolidation payment plan. Rather than selling any of your property, you are promising to pay some or all of your debt back over the course of time . You would file a Chapter 13 rather than a Chapter 7 when you have some property that you consider too valuable to lose in a liquidation, when you make too much money to qualify for a Chapter 7, or when you want a payment plan to help pay the arrears on a secured debt, like when you fall behind on your mortgage payments. In order to file a Chapter 13, you need to have enough income to make the plan work, so you need enough income for your normal expenses plus whatever the plan payments may be.
Other types of bankruptcies not necessarily for consumers that you may have heard of include Chapter 11 or Chapter 12 .
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Discharging Debts In Bankruptcy
A bankruptcy discharge releases a debtor from being personally responsible for certain types of debts. So, after a bankruptcy discharge, the debtor is no longer legally required to pay any debts that are discharged.
The discharge prohibits the creditors of the debtor from collecting on the debts that have been discharged. This means that creditors have to stop all legal action, telephone calls, letters, and other type of contact with the debtor. This prohibition is permanent for the debts that have been discharged by the bankruptcy court.
You cannot discharge all debts in bankruptcy. Some of the most common debts that you cannot get rid of in bankruptcy are debts from child or spousal support, most student loans, most tax debts, wages you owe people who worked for you, damages for personal injury you caused when driving while intoxicated, debts to government agencies for fines or penalties, and more.
Get Our Top Investigations
BK Billing launched in 2016 to manage the two-part agreements for lawyers, usually with clients paying $0 up front. The company helps attorneys craft what they say are legally defensible client agreements and processes the payments.
So far, the company has worked with a few hundred attorneys in more than 40 states, said David Stidham, the CEO. But because few judges have decided whether such arrangements are legal, there is wide uncertainty about the BK Billing model. Its so wild west right now, he said.
Sean Mawhinney, the companys president, said he used the two-part Chapter 7 arrangement when he practiced as a bankruptcy attorney in Utah, where BK Billing is based. Offering Chapter 7 for $0 down made a huge difference for clients, he said, especially those who were having their wages garnished.
If they can stop the bleeding and get their case filed quickly, then they can make a reasonable payment to the attorney, he said.
But, of course, BK Billing is a business, and its services come with a cost that can cause problems of its own. To reduce the risk of clients defaulting, BK Billing pays attorneys up front and charges a 25 percent fee. So, if an attorney normally charges $1,000, BK Billing will pay the attorney $750 and then collect $1,000 from the debtor over the following year.
It was a way for us to expand the volume of people we can help without a lot of resources on our end, said McGarrity.
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