Monday, March 10, 2014

Co-Debtors in a Chapter 7

A lot of people in Bucks County have debts they are seeking in a Chapter 7 but they are co-signed by another individual.

It is important to note and to be understood that the automatic stay applies only to acts against the debtor and the debtor's property.  It does not protect cosigners, guarantors, or other codebtors.

Therefore -- The automatic stay of a Chapter 7 bankruptcy does not prevent a creditor from collecting a dischargeable debt from a cosigner.  This is important -- the calls, lawsuits, and letters may continue against a non-filing debtor.

Wednesday, March 5, 2014

Real Housewives of Bankruptcy Fraud

The long-awaited trial of the Giudice family has ended with a plea.  Rarely does bankruptcy fraud hit the news.  Go here for an in-depth review of the case.  But, when bankruptcy fraud does hit the news, I'm fixated on the progress of the case (which is frequently unknown given the slow wheel of federal cases).  But, this ended in a not-so-unsurprising way.

Any Bucks County bankruptcy lawyer who has done this long enough has had a client try to commit fraud, either from not disclosing property or income to more nefarious reasons.  Anytime I catch a sniff of fraud, I'm out.  The client gets their money back and the petition is never filed.  It's not worth it.  And, as you can see, it is not worth it for the person committing the fraud.

Sentencing is in July and, after discussions with a Lehigh County criminal lawyer, we both agree that there is a very strong possibility of 12 months incarceration for her and 24+ months for him.

Monday, March 3, 2014

Right of the Debtor -- Utility Services

As a debtor in a Bucks County bankruptcy, you have an opportunity to enjoy the continued use of your utility services (i.e. electric, water, etc.).  Most people in the area get their electric from PECO.

I've blogged about adequate assurance before.  Remember --- even if you owed money to the utility company, they still must provide you with service.  To retain this right, however, a debtor must, within 20 days after the date of the filing of the bankruptcy case, furnish adequate assurance of payment for future services in the form of a deposit or other security.  This is governed under 11 U.S.C. 366.