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Date: September 22, 2009
Host: Michael D, Siegel View Transcript | Archive Index For All Legal Chats Bankruptcy is traumatic enough as it is, what with facing financial ruin and dealing with a roller coaster of emotions, without adding the mind-numbing details of the bankruptcy code to sort out. Join Michael Siegel, an attorney who deals with bankruptcy and other credit issues, on September 22nd at 10 PM Eastern (9 Central, 7 Pacific), to get your bankruptcy or other consumer credit questions answered. MICHAEL SIEGEL practices in the fields of bankruptcy, consumer rights, commercial litigation
and real estate. His main office is in New York City, and he maintains an office in Jersey City,
New Jersey. Michael spent eight years representing large institutional creditors at large law firms in New York City and New Jersey. Now a partner at Siegel & Siegel, P.C., Michael represents mostly individual consumers and businesses. Michael is a graduate of the University of Chicago Law School. He is admitted to the bars of New York State and New Jersey, as well as the Federal Courts in New Jersey and the Eastern and Southern Districts of New York.
http://www.lawyers.com/siegelandsiegel Live Chat Transcript mzjerzey06: "GOOD EVENING EVERYONE"
qa lady: "Hi!"
InFlaBK: "hello"
Michael D. Siegel: "Hi, all. THe order will be inFLA, qa lady and then mzjersey."
Michael D. Siegel: "InFlaBK: "In a chapter 7 Florida case one of the the unsecured (private, not CC) creditors filed an objection to discharge of THE ENTIRE CASE not just their debt. Question is; should we have filed a motion to determine the basis for the objection of the entire case before moving forward with casae related items like discovery/production and deposition?""
Michael D. Siegel: "A case to object to discharge is a case within a bankruptcy case. You are the defendant, the creditor is the plaintiff. the case will proceed under the rules of procedure. In truth, you cannot do this without a lawyer. You will need to know procedure and draft pleadings and try the case. The fact you even asked this question shows you need help. Discovery is part of the process, so you definitely should get the information you set forth. You need to ask for it in the proper manner."
Michael D. Siegel: "Hi rad. We will get to you shortly."
Michael D. Siegel: "InFlaBK: "Question regarding an existing case in Florida; Chapt 7 personal BK. Substaintial unsecured debt, personal home 0 equity in foreclosure, rental home 0 equity in foreclosure, defendant has no assets. A private, unsecured creditor filed objection to discharge OF THE ENTIRE CASE. In other words, they did not just object to the discharge of their debt but to the whole case. The defendant atty did not challenge the plaintiff in a motion to the court to show cause for the objection of the entire case prior to moving forward on discovery, production and deposition. What would you have done in this situation?""
InFlaBK: "I have an atty"
Michael D. Siegel: "Your attorney is not required to represent you in this case unless your retainer calls for it. I charge extra for these kinds of cases, and I am sure your atty will also."
Michael D. Siegel: "You need to fight this case. Otherwise you will not get the discharge, which is the whole point of the case."
InFlaBK: "Agreed but how often do creditors object to AN ENTIRE cse rather that their debt?"
Michael D. Siegel: "If you lose, even by default, you will not be free of any debt. Section 727 of the Code governs these cases. Some grounds go to the whole case. Most deal with fraud in the process, like failing to disclose assets, or cooperate with the trustee. You must appear and fight the case, even if it has little merit."
InFlaBK: "I understand they will try to prove fraud but the complaint was SO open ended and broad, they asked for everything document-wise..."
Michael D. Siegel: "Filing this kind of case is a good leverage maker for a creditor, and I have done it for that reason."
Michael D. Siegel: "You will have to provide discovery. Your attorney will advise you on what is proper and what is not. However, in these cases, discovery is broad."
InFlaBK: "Exactly what I said! Leverage for a settlemetn, creditor has deeep pockets. Can they appeal if we win the initial case? How high can they appeal?"
InFlaBK: "How difficult is it for the plaintiff to prevail percentage wise?"
Michael D. Siegel: "In theory, they can appeal to the US Supreme Court. In reality, as these cases are fact based, and judges are given discretion over facts (as opposed to the law), appeals of these kinds of cases usually fail."
Michael D. Siegel: "There is no way to say on the internet. It depends on what you did and what evidence is produced."
Michael D. Siegel: "As these cases are fact based, only your lawyer, who knows the facts, can analyze the chances. The main thing is you have to fight it."
InFlaBK: "Understood; I cosigned with several other guarantors on a personal, unsecured loan. No financial statement, no credit."
Michael D. Siegel: "I cannot give advice on an internet chat about the facts of your case. Do not be cheap about this and rely on an internet chat for information. This case is a serious matter."
InFlaBK: "We're fighting ($$) no other choice. You've been very generous with your time sir, i appreciate it. good night."
Michael D. Siegel: "Thank you. Good night."
Michael D. Siegel: "qa lady: "Mom in SC is 19K in debt. 13K is collection accts (all unsecured debt), the rest is delinquent medical bills. Most of the (40+) collection accts are small $, but range from $5 to $1500. She has a stable job, rents, zero savings, and her car is worth 4-5K. She can pay at least $350, maybe $450-$500 some months towards these old debts. We arenâ¿¿t too concerned about improving her credit score, we just want to get her money under control. We think we can handle settling/paying her debts over 3-4 years. Chap 13 doesnâ¿¿t sound like a good option. Is there anything else we should consider? We plan to sort collection debts by age and settle/pay them starting with the oldest (closer to SOL). Is this a reasonable plan? Should we prioritize the few high $ debts or does it matter? How likely would a collector be to pursue a judgment for a debt of $5- $1500 from someone who doesnâ¿¿t own anything but a 5K car? We know SC doesnâ¿¿t allow wage/pension garnishment for credit/store debt. We think Drâ¿¿s/hospitals can get a judgment and garnish for medical bills, but if they sell the debt to a collector, the collector cannot garnish. Is this correct? We are going to make routine payments on delinquent medical bills that are still with the original Dr/Hospital. If we can pay lump sums at some point, is it common to try to negotiate settlements for this type of debt. Overall, are we on the right track here?""
Michael D. Siegel: "You are on the right track. All creditors will negotiate, and a lump sum is better than a payout. Based on her income, you might want to see if she can get a lower interest loan to pay these debts, which are not that high as debts often go in these situations."
Michael D. Siegel: "You are right. SC is one of the few states where wages cannot be garnished, so your mom may be judgment proof, meaning the creditors can get judgments but not seize anything."
Michael D. Siegel: "I would, in addition to what you said, deal with the ones in collection first, or where there is a suit. Do not worry so much about the SOL."
Michael D. Siegel: "I assume Ch. 7 has been ruled out, on income, since you mention only Ch. 13."
Michael D. Siegel: "Hi jskabe. we Will get to you shortly."
qa lady: "Yes, she doesn't qual for Ch 7"
jskabe: "Thanks."
Michael D. Siegel: "Good luck."
qa lady: "Coll before delinq medical, or just before other credit debt?"
Michael D. Siegel: "Anything with a lawyer or collection office is likely to go to suit more quickly. Your goal should be to deal with these before there is a suit, since a judgment would be worse for credit scoring, and enforcement."
Michael D. Siegel: "Mzjersey, you are up. Please post."
qa lady: "Thank you very much!"
Michael D. Siegel: "rad, you are next, then jskabe."
rad28: "I am no longer able to make pymts. on a cr. card, I tried to make arrangements, but since I had already been on a plan with them, they said they could not help me for another year. I was current, and I missed Sept. pymt. how long will they cont. to charge late fees, and if they get around to ask for a judgement, can they take money from my SS check directly deposited in my checking acct? My debt to income ratio does not allow me to seek other sources to pay off the card."
Michael D. Siegel: "They can levy a bank account that has SS money in it. The burden then shifts to you to make a motion in court to claim that the money is exempt SS funds, which you will have to prove. The exact procedure for this varies by state. Once you miss a payment, the position of the bank seems usual and consistent with how these things go."
Michael D. Siegel: "they will charge late fees until you pay, as well as collection costs."
rad28: "Even if I close the acct. by not agreeing to the new terms they rec. sent out?"
Michael D. Siegel: "Close the bank acct. or the credit account?"
rad28: "Cred. CArd Will they be able to garnish my SS check?"
Michael D. Siegel: "Yes. If you close the account you still owe the balance."
rad28: "Yes, to the SS check???"
Michael D. Siegel: "If you cancel the credit card you are still going to have to make payments on the balance, according to terms. If you do not, you will be in default, you will get sued, and you will get a judgment. At that point, they will try to levy your bank account. As I said, at that point the burden shifts to you to claim your exemption."
Michael D. Siegel: "If you do nothing, the Sheriff will assume the money is ordinary cash, and not SS deposits, and he will take it."
rad28: "I would have to prove it is SS, is that what you are saying?"
Michael D. Siegel: "yes"
rad28: "And if it is only SS then they CR card, can not garnish the checking?"
Michael D. Siegel: "They cannot if you prove only SS funds are in the bank account."
rad28: "Thanks for the hlep"
Michael D. Siegel: "Good luck."
mzjerzey06: "HELLO MY QUESTION IS"
Michael D. Siegel: "go ahead."
mzjerzey06: "THAT MY GRANDMOTHER IS SELLING A RESTURANT TO A LADY AND SHE FILED BANKRUPTCY AND PUT THE PROPERTY UNDER IT CAN SHE LEGALY DO THAT"
Michael D. Siegel: "Is there are written contract of sale?"
mzjerzey06: "she was paying rent to own but has not payed rent in 3 months"
mzjerzey06: "between her and my grandmother"
Michael D. Siegel: "Is that a yes"
mzjerzey06: "yes"
Michael D. Siegel: "The contract you have is called executory. There is a schedule on the bankruptcy forms for it, and that is why your grandmother got notice of the case. In the bankruptcy forms, the lady has to state her intentions with respect to the contract. She needs to say if she is keeping the deal or canceling it."
Michael D. Siegel: "If she is not paying rent, you can make a motion to cancel the deal and seek relief from the stay to evict her."
Michael D. Siegel: "You cannot bring an eviction without a motion in the bankruptcy court."
mzjerzey06: "and if she cancels we get the property back"
Michael D. Siegel: "Yes."
Michael D. Siegel: "However, the terms of the contract will govern some of these issues."
Michael D. Siegel: "You really need a local lawyer to handle this. Also, make sure you have insurance in place, or that hers is current."
mzjerzey06: "also my grand mother passed a way so how do my mother go about get the property turned over to her"
Michael D. Siegel: "You need to form an estate in the county in which she died. An estate succeeds to the rights in contracts of a decedent. The court will not hear you without letters from the Surrogate or Probate court. Do this ASAP."
Michael D. Siegel: "Are you in NJ?"
mzjerzey06: "yes its in new jersey"
Michael D. Siegel: "Hi Joanne. There are 2 people ahead of you. Please wait."
Michael D. Siegel: "What county did your grandmother live in, and what court is the bankruptcy in?"
mzjerzey06: "camden county and the court is in camden county"
Michael D. Siegel: "OK. Go to the Surrogate of Camden County, in Camden, and get the forms for an administration proceeding, if there was no will. Then, prepare a motion in bankruptcy court in Camden seeking relief from the stay. You may need a lawyer for both of these steps."
mzjerzey06: "my grand mother died in puerto rico"
Michael D. Siegel: "Then you need a Puerto Rican lawyer to make an estate there, if that was her residence"
Michael D. Siegel: "OK. I want to get to the last 2."
mzjerzey06: "so in little words she can keep the proprty even if she broke her contract ? also my grandmothers husband is still alive cant he came the property"
Michael D. Siegel: "No. You need to take legal steps to assert your rights. I have stated them."
Michael D. Siegel: "jskabe: "I have filed for chapter 7 bankruptcy. I did not attempt to discharge my student loans and have never been late. My loans were in deferment. My private student loan lender, when notified about the bankruptcy, immediately filed a claim with the loan's under writer. The under writer immediately sent the loan to collections. The collector has sent two letters demanding payment in full BEFORE we have received the bankruptcy discharge. My question is: 1. Can a student loan provider call a student loan due because I have filed for bankruptcy, especially when I have never been late? 2. Can a collector contact me during the stay period before discharge? 3. If either of these scenarios are not legal, do I have any recourse or am I stuck trying to come up with $80,000? For what it is worth, I just began a full-time graduate degree program. Thanks in advance.""
mzjerzey06: "thank you for you time sir have a great evening"
jskabe: "Thanks for your time Michael."
Michael D. Siegel: "A student loan collector can contact you unless you have a lawyer. They cannot sue you unless they get stay relief. In the end, you owe the money. What seems wrong is that staying in school should defer these loans. You need to look at your loan agreement. I agree that this is not typical behavior."
jskabe: "Have you ever heard of a student loan company calling a loan due simply because I filed for bankruptcy?"
Michael D. Siegel: "No"
jskabe: "What can I do with the collections agency contacting me?"
jskabe: "I already have a lawyer who hasn't answered an e-mail or phone call in over 2 weeks."
Michael D. Siegel: "Tell them that you are in bankruptcy, and the calls violate the stay. Put this in writing. Copy the trustee on the letter, and the US Trustee, who monitors these things."
jskabe: "Ok. Thanks."
Michael D. Siegel: "Joanne, you are up."
Joanne33: "I have been divorced for 11 years. We have a daughter together. My ex husband is remarried and they have filed for bankruptcy, Chapter 7. We live in MI, he filed in the Eastern District of MI. Does he still owe me out of pocket medical expenses (friend of the court ordered that he pay 55% of any out of pocket medical expenses)? What about child support he still owes? What do I need to do?"
jskabe: "Any other ideas? I just don't have the $80k."
Michael D. Siegel: "Child support is not dischargeable. What is a "friend of the court"? If the payments are alimony or support for your medical, these are not discharged either. File a claim in the case, and write the trustee about your claim. Send the trustee the matrimonial and child support order. Other than that, you do not really need to do anything. How are these claims listed on the creditor list? HAve you seen the papers?"
Joanne33: "Bankruptcy court said that child support is not discharged. He told me that he doesn't owe me the out of pocket medical expenses for our daugher that I should be reimbursed or get a credit since he filed bankruptcy."
Michael D. Siegel: "You may owe the doctor, but he owes you."
Michael D. Siegel: "Jackie, the time for the chat is over. Use the community area to post your question. I am handling the last question now. Sorry."
jackie2009: "I was in medical school for past two years. I had saved up $100,000 and entrusted my husband with this amount prior to going to college. While I was in College my husband spends all the money I had in savings. He also submitted forged employment letters and pay stubs and applied for credit cards in my name. He also forged my signature in these applications."
Joanne33: "with the claim, i need to include back child support owed and out of pocket medical expenses?"
Michael D. Siegel: "Yes, Joanne."
jackie2009: "sorry"
Joanne33: "Okay, thank you"
Michael D. Siegel: "Jackie, you need to go to the police and make a criminal complaint."
jackie2009: "He also committed similar forgeries to inflate my lines of credit. He took out a total amount of nearly $300, 000 in my name through false means. This does not include the $100,000 I had in cash in my account."
Michael D. Siegel: "Without a criminal complaint, you will have no civil remedy, because no one will believe your story. You must be willing to have your husband arrested."
jackie2009: "I only found out about this a month ago. Finally after confessing to me he wants to own up to what he has done and offered to draw up a sworn affidavit which he will sign in front of a lawyer confessing to his actions. I dont know if this will be of any value in a court of law."
jackie2009: "I dont want any trouble for him at the same time I dont want to be party to anything he did as I had nothing to do with it."
jackie2009: "He said he wants to apply for bankruptcy alone, is this a possibility ?"
jackie2009: "I would like to divorce him and make him responsible for the debts he created. What are my options at this point?"
jackie2009: "thats all"
jackie2009: "Thanks for your help. Sorry I am really very stressed out"
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