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Social Security Income and the Means Test

When filing a Chapter 7 or 13 bankruptcy, a debtor must show that he passes the means test. The means test is basically a series of calculations that are supposed to show, in theory, whether or not the debtor has enough income to be able to pay back his creditors. To perform the means test, one must determine what the debtor’s income is. Almost all sources of income are to be taken account of on the means test. The amount of the income is determined by taking the six month average of the debtor’s various sources of income.

Social Security Income gets special treatment on the means test. It can be completely excluded. That means that Social Security Income does not have a negative impact when the means test is used to determine if someone may qualify for a Chapter 7.

The means test is not the only determining factor on what type of bankruptcy a person is allowed to file. The actual budget of a person is taken into consideration as well. This budget is represented on Schedules I and J. If Schedule J, shows a substantially positive amount, chances are that the debtor will not be able to qualify for a Chapter 7.

Social Security Income can also be excluded from a debtor’s budget. Therefore, it will not have an impact on a person’s qualification for a Chapter 7 here either.

If an individual wishes to file a Chapter 13, he may elect to include their Social Security income on his budget, so that he can show he does have enough income to afford a repayment plan.

 

By Kristen Whelchel

How Will a Bankruptcy Affect my Credit?

People often wonder how filing for bankruptcy will affect their long term credit. Some have the misconception that a bankruptcy will ruin their chances of ever having a good credit score. While it is true that a bankruptcy will stay on a credit report for ten years it is not the end for a person’s chances at having good credit.

In the short term a person’s credit might take a drastic hit after filing for bankruptcy. This depends on the credit score at the time of filing. The higher the score before filing the further it will fall. For example a person with a score of 680 before filing could see it fall to 550 while a person with a score of 780 could fall to 560. If a score is in the 500s or lower at the time of filing there may not be much change.

After the bankruptcy a person can begin to rebuild. Having a bankruptcy on your record will be a negative mark for some potential creditors. It may take some time after filing before a person is able to get a new loan. However, many people are surprised to find they are able to get car loans and new credit cards relatively quickly. The interest rates may be high and the credit limits low, but it is a start. By being careful and paying back any new debt on time a credit score can start to rebuild. While the bankruptcy may show up on a credit report for ten years a score can be repaired within a few years. The bankruptcy is a fresh start for people looking to build a secure financial future.

Sources:

Bankruptcy timeline: Rebuilding credit

https://www.bankrate.com/finance/debt/bankruptcy-timeline-rebuilding-credit-1.aspx

How to Rebuild Your Credit After Bankruptcy—Fast

https://www.huffingtonpost.com/curtis-arnold/how-to-rebuild-your-credi_b_5790860.html

Credit Report Q&A

https://www.myfico.com/crediteducation/questions/credit_problem_comparison.aspx

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Can my Garnished Funds be Recovered After Filing a Bankruptcy?

The short answer is yes. The long answer is yes, but it depends on the situation. If a creditor has garnished a debtor’s funds there are ways for the debtor to recover some of the money after filing bankruptcy.

Any funds taken by garnishment or levy within the 90-days prior to the bankruptcy filing can potentially be recovered. If the total amount is $600 or more a debtor can make a claim for the return of the funds. However, in a bankruptcy a debtor can only protect a certain dollar amount of their assets. If the debtor has already exceeded the amount which could be protected the garnished funds cannot be recovered. In that situation the bankruptcy court may attempt to recover the funds and then distribute them evenly to all the debtor’s creditors.

If the creditor refuses to return the garnished funds a debtor does have the option of filing a claim with the bankruptcy court. The court may compel the creditor to return the funds. However, it does cost money to file the claim so a debtor will need to weigh the cost of the claim against the amount that could potentially be recovered.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Can I Keep my Yearly Bonus in a Chapter 7 Bankruptcy?

Some employers give their employees yearly bonuses and holiday bonuses. If you are thinking of filing a Chapter 7 bankruptcy, there are a few things you should know if you have just received a bonus, or if you are expecting a bonus within the next year.

As a general rule, if you have received a bonus within the last six full months, the bonus may be included in calculating your income to determine whether you qualify for a Chapter 7 bankruptcy. When you file a Chapter 7 bankruptcy, the United States Trustee will average your last six full months of income to decide whether you qualify for a Chapter 7. For example, if you file for a Chapter 7 bankruptcy in July, the trustee will look at your average income from January to June. If you have received a bonus within these six months, the Trustee will include the bonus in your average income. If the bonus is a large bonus, it may affect whether you qualify.

One possible solution is to wait until your bonus falls off of the six month average before filing for bankruptcy. Suppose that you received a bonus on January 1. If you file for bankruptcy in July, this bonus will likely be included in your six-month average to determine whether you qualify (January to June). But if you wait to file until August, your January income will no longer be included to determine whether you qualify for bankruptcy, so you may have an easier time qualifying.

You should keep in mind that the Trustee can also look at any bonuses are you entitled to receive within the next year after you file for bankruptcy. Future bonuses do not factor into whether you qualify for bankruptcy, but a future bonus may be considered an asset in your case. The reason for this is that even if you have not yet received a bonus, if you are entitled to the bonus at the time you file your case, it is considered an asset in your bankruptcy. Depending upon the other assets that you own, you may be able to keep your bonus, or you may have to give up the bonus to the trustee when you do receive it. Whether you can keep your future bonus when you file for a Chapter 7 bankruptcy depends on the facts of your case. You should consult your attorney if you are expecting to receive a bonus within the next year, to determine whether you can keep your bonus.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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How Bankruptcy Effects Credit Score

No ifs, ands or buts, your credit score will drop.

How low?

It depends. What does your credit score look like now? If your credit is fairly unblemished prior to filing, you can expect a large drop in your score. However, if your credit is already tarnished and full of negative items, your score may see only a slight drop. A 2010 FICO report showed that an individual starting with a credit score of 780 could drop to 540 and an individual with a 680 score could fall to 530. While these are only examples, they demonstrate that an individual with a higher score to begin with has a farther way to fall, but both individuals land in close proximity (530-540). Until you file, it is impossible to state where you will land. Your credit score may be affected more or less.

How long will the bankruptcy negatively affect your credit score?

A bankruptcy will stay on your credit report for 10 years. BUT, as time passes and positive information supplements your report, the impact becomes less and less debilitating. Further, if you are motivated to rehabilitate your credit, it can be done. Your credit score can be rebuilt in 1 – 3 years.

So how do I move on and rebuild my credit after I file for bankruptcy?

Start by verifying that your credit report is free from errors. The major credit reporting bodies are TransUnion, Equifax, and Experian. Check that your report from each of these institutions is accurate and lists your pre-bankruptcy debts as “included in BK.” From there, be sure to check back on your credit score regularly (every 4 months). Eventually, you will be able to request that the pre-bankruptcy debts be removed from your report altogether.

Next, make an honest assessment of your finances and what led you to file bankruptcy in the first place. If you fail to recognize what went wrong the first time, you will likely fall into the same pattern and end up in the same trouble as before. Once you have recognized these financial faults, weed them out and start taking action to establish positive credit.

Right after filing it will be difficult to borrow money. Why? Because you are considered a greater risk to the lender, often referred to as a subprime borrower. As a result, you will likely be offered higher interest rates and greater penalties for defaulting. On the other hand, some credit card companies may find you to be a better risk and will start sending you offers immediately after you file bankruptcy. This belief that an individual who has just filed is a good risk for credit card companies is rooted in the fact that bankruptcy law forbids individuals to receive a second discharge in a Chapter 7 bankruptcy within eight years of the first filing. Meaning: a debtor cannot rid himself of the responsibility of newly acquired credit card debt for another eight years.

Remember this: THERE IS HOPE. YOUR CREDIT IS NOT LOST FOREVER! It may take some self-assessment and discipline, but it is absolutely possible. It will be more difficult at first, but as was alluded earlier, as time passes the positive elements to your credit will increase and the “bad” will begin to dwindle.

 

 

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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How Will my Employer React to my Decision to File for Bankruptcy?

While it is difficult to say whether or not an employer, current or future, will react poorly to your bankruptcy, a few things are certain: You will not be fired. You will not be demoted. You will not be punished…at least you shouldn’t be.

The United States Bankruptcy Code forbids both public and private employers from discriminating and terminating employment based solely on the fact that you filed for bankruptcy. Note however, that if you have given your employer other reasons to dismiss you, such as excessive absences or poor performance, your bankruptcy will not protect you from getting the axe.

Further, if you are searching for a new job, do not be discouraged that a bankruptcy on your record will blow your chances at getting the position you want. Not only does the Bankruptcy Code shield you from termination and discrimination in an existing job, it may protect you when seeking out future employment.

If the position you are hoping to land is with a federal, state or local government agency the law states that the employer cannot turn you away just because of your history of bankruptcy. While private employers may refuse to hire you under such circumstances, do not despair. Depending on the responsibilities of the position for which you are applying, an employer may look favorably on your decision to file.

It is true that an employer managing a position in finance, accounting or the handling of cash will take a bankruptcy seriously. Nonetheless, a bankruptcy discharge may help with positions of high security clearances or those involving valuable merchandise. Employers may be concerned with the possibility of their employees accepting bribes or stealing company goods or stealing secrets to pay off the employee’s own personal debts. That being said, a decision to file bankruptcy is often seen as a responsible and proactive decision to solve a potentially damaging situation.

All things considered, it is possible that your bankruptcy goes unnoticed by your current employer. Generally, employers only learn of an employee’s bankruptcy if his wages are being garnished, if the employer is listed as a creditor or if the employee has a Chapter 13 plan deducting payments directly from his or her paystubs.

Before coming to the conclusion that filing bankruptcy will greatly damage your career, meet with one of our attorneys to discuss why bankruptcy could potentially help your career. In fact, here are individuals whose careers were not ruined by bankruptcy:

  1. Walt Disney
  2. Burt Reynolds
  3. Abraham Lincoln
  4. Michael Vick
  5. Larry King

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Can I get Money Garnished From me Back When I File for Bankruptcy?

For people living on a tight budget, a garnishment can be the difference between making ends meet and falling further into debt. If you are being garnished and you are considering bankruptcy, you should know that you may be able to recover money taken from you by your creditors, but the garnishment must meet certain requirements for you to get your money back.

First, the timing of the garnishment determines whether you can recover any of the money taken from you. If money was garnished from you before you file for bankruptcy, that money can only be recovered if it was taken within the immediate 90 day period before filing your case. For example, if you filed your bankruptcy case on November 1, 2014, you could recover money garnished up to 90 days before that date (August 3 to November 1). However, you could not recover any money taken earlier than that 90-day period (in our example, before August 3). Additionally, if your creditors continue to garnish any of your money after you file for bankruptcy, that money can be also recovered for you.

Second, the amount of the garnishment within the past 90 days can determine whether you can recover money taken from you by your creditors. The amount of money taken from you within the past 90 days must be $600 or more for you to be able to recover that money. If the amount taken from you is less than $600 total in the past 90 days, you will unfortunately not be able to recover that money in bankruptcy. (But, note that if your creditors continue to garnish money from you after you file for bankruptcy, any amount that they take after you file can be recovered for you).

Third, it is only worth recovering money garnished from you if you are able to protect that amount of money as an asset in your case. Whether you can protect the money you recover depends upon the value of other property that you own and that you want to protect in bankruptcy. It can be a complex question, but your bankruptcy attorney will be able to walk you through what property can be protected when you file for bankruptcy.

Finally, garnishments are only worth recovering if the garnishment is from a type of debt that can be discharged in bankruptcy. Certain debts cannot be discharged in bankruptcy (you will still owe these debts after your bankruptcy). Debts such as student loans, alimony, child support, and recent tax debt, will remain after bankruptcy. There will not be any point in recovering a garnishment for one of these types of debt, as you will still owe that debt after bankruptcy.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Should I Cash Out My Retirement Account to Pay Off Debt?

Taking withdrawals from an IRA before you’re retired is something you should do only as a last resort. There are a few reasons why.

If you withdraw money from a traditional IRA before you turn 59 ½, you must pay a 10% tax penalty in most cases, in addition to regular income taxes. Plus, the IRA withdrawal would be taxed as regular income, and could possibly push you into a higher tax bracket, costing you even more.

Though the federal government allow you to withdraw contributions from a Roth IRA without incurring a penalty, you will owe a penalty (and taxes) if you withdraw the earnings on those contributions.

In addition, money you take out of an IRA cannot be replaced, since you would still be restricted to yearly contribution limits for future years. So even if you withdraw only a small amount, factor in the years of compounding interest you would be forgoing, and that small withdrawal could end up costing you a small fortune in your golden years.

In both Chapter 7 and Chapter 13 bankruptcies, IRAs, 401(k)s, and most retirement accounts are protected. This means you have the possibility of discharging your debt while still having a nest egg for your retirement. Before you cash out your accounts to pay off debt, set up an appointment with Hoglund Law Office where an experienced bankruptcy attorney will meet with you to discuss the possibility of bankruptcy as a viable option rather than losing the money you’ve worked hard to set aside for retirement.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Utility Services and Bankruptcy

Many people who file bankruptcy are behind on their utility bills. Some are being threatened with a utility shut off in the near future. If this is the situation you are in, the good news is that filing a bankruptcy case can stop a person’s utilities from being shut off. In addition, public utilities cannot refuse to provide or cancel service because you have filed a bankruptcy case.

In a chapter 7 bankruptcy case, most types of unsecured debt will be discharged, or wiped out, through the bankruptcy. Utility bills are considered an unsecured debt, and as a result, will be discharged along with a person’s other debts.

However, this doesn’t mean that you will not have to pay utility services after you file your bankruptcy case. The bankruptcy will not discharge current or future utility bills. In addition, a utility company can require you to pay a deposit for future service. If your utilities had been disconnected, the service provider can also charge you a reconnect fee. If you fail to make utility bill payments after your bankruptcy case is filed, your utilities will eventually be shut off.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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What Happens to Secured Debts after Bankruptcy?

A “secured debt” is any type of debt that you obtain by agreeing to give the lender an interest in some type of property in exchange for the loan (also commonly referred to as collateral). The most common types of secured debts include car loans and mortgages.

Many people wonder if they will still owe secured debts after filing bankruptcy. The answer to this is yes and no. Filing bankruptcy gets rid of your legal obligation to repay the debt, meaning that the creditor can’t sue you to get paid. However, the creditor can still take bank their collateral if you don’t pay the debt. This means that if you don’t pay for your mortgage or car loan, the lender can’t sue you, but they can repossess your car or foreclose on your home.

For this reason, if you want to keep property that you pledged as security for a debt, it is important that you continue to make payments for it during and after your bankruptcy case. Some lenders may also require you to sign paperwork agreeing to be legally responsible for the debt after the bankruptcy (called a “reaffirmation agreement”). If you have any questions about how your secured debts will be treated after filing bankruptcy, speak to your bankruptcy attorney about it.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Medical Debts and Bankruptcy

Overwhelmed with medical debt? If you have incurred medical debt due to illness or having medical procedures without insurance, a Chapter 7 bankruptcy can help you get rid of your debt. Many people are mistaken in thinking they are only able to file bankruptcy on consumer debts such as credit cards or unsecured loans, but medical debts are also included in bankruptcy.

Medical debts can be tantamount to credit card debt for a lot of people and many hospitals and clinics pursue these debts vigorously.In Minnesota, hospitals and clinics are able to collect medical debt from both spouses even if the debt is only incurred by one spouse, which can create issues if your family members have medical issues. Bankruptcy can help you avoid harassment, lawsuits and garnishments and bank levies on behalf of hospitals and clinics.

Many times, people suffering from illnesses or medical debts will be out of work and unable to keep up with their hospital bills and regular living expenses. Hoglund law can help! Please schedule a free consultation with one of our experience bankruptcy attorneys to discuss how we can help you through a medical bankruptcy.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Stopping Lawsuits, Garnishments and Bank Levies

When a person doesn’t earn enough money to cover his or her expenses, life can be stressful enough. Unfortunately, this financial stress can become overwhelming when one or more of an individual’s creditors threaten to take legal action to collect money from a debtor.

For example, credit card companies and medical providers often bring civil lawsuits against debtors who do not pay their bills. Once a creditor obtains a judgment against a debtor, the creditor can begin garnishing the debtor’s wages or seizing money the debtor has in his or her bank accounts. This can have serious negative consequences for some debtors, who may not be able to afford to put food on the table or pay their monthly rent if all of the money in their bank account is suddenly seized.

Fortunately, bankruptcy can offer relief for people who are being threatened with lawsuits, garnishments or bank levies by creditors. Once a person files a bankruptcy petition, an automatic stay goes into effect. The automatic stay prohibits creditors from taking any further action to collect debts from the petitioner for the duration of the bankruptcy proceeding. As a result, creditors must immediately stop from garnishing a person’s wages or seizing his or her bank accounts.

In addition to stopping wage garnishments and bank levies, the automatic stay can benefit debtors in many other ways, such as by delaying evictions or utility shut-offs, stopping repossessions and can even be used to prevent a home foreclosure in certain circumstances. If you have questions about whether the automatic stay could help you, contact a local bankruptcy attorney.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Can I Get Rid of my Medical Debt Through Bankruptcy?

You may be wondering whether or not you can discharge your medical debt through bankruptcy. The short answer is, yes. Many individuals have circumstances that lead to high medical bills that they’re unable to pay, a burden that can be completely cleared with a discharge of a chapter 7 bankruptcy.

Medical debts are considered unsecured non-priority debts, meaning they’re entirely dischargeable in a chapter 7 bankruptcy. Once these debts are discharged, you are no longer responsible and creditors may no longer come after you. In order to qualify for a chapter 7 bankruptcy, you need to pass an income means test. This means you (and your spouse if applicable) need to satisfy certain income requirements in order to be eligible for chapter 7 relief. This is something your attorney at Hoglund Law will be happy to analyze with you at your free bankruptcy consultation meeting.

It is important to keep in mind that your chapter 7 bankruptcy will only discharge debts that are outstanding at the time of filing. If you know that you are soon to be incurring significantly more medical debt, it may be worth waiting to file until after that happens. It’s also important to keep in mind that you may only be granted relief under a chapter 7 bankruptcy once every 8 years.  This means, if your medical care or the medical care of your family is ongoing, or you know a large expense is coming soon, you may want to wait until treatment is complete before filing for bankruptcy.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Filing a Statement of Intention

When filing for bankruptcy under Chapter 7, protection of certain assets requires more than just listing them under the applicable exemptions. For example, a homestead may be subject to a mortgage or a vehicle may serve as collateral for the repayment of a loan. In these situations, the debtor must file a Statement of Intention within 30 days after filing the Petition, or before the First Meeting of the Creditors, whichever is first. If the debtor is represented by an attorney, the attorney will typically file this form along with the Petition. On the Statement of Intention, the debtor must choose one of four options with regard to the asset. Surrender, redeem, reaffirm, or ride-through.

If the debtor is unable to make on-going payments toward repayment of the loan, he or she might have to surrender the asset. This means that the creditor may decide to repossess the asset. The good news, however, is that the repossession will wipe out the claim up to the value of the property, and the bankruptcy discharge will wipe out any outstanding balance.

If the debtor is able to come up with enough cash to “buy” the asset, he or she may pay the creditor the value of the asset, which will wipe out that amount of the claim (the secured amount). Any remaining balance on the claim will be unsecured and will be discharged. However, this is often difficult to accomplish because the redemption must be made in a one-time payment, rather than by installments.

If the debtor has equity in the asset, or will soon gain equity, it might be wise to reaffirm. This involves a written agreement with the creditor that also must be filed with the court. Under the agreement, the debtor becomes re-obligated to the debt, which removes the debt from the bankruptcy case. The upside is that the creditor must then report timely payments to the debtor’s credit report, which re-builds the debtor’s credit score. The downside is that if the debtor later defaults and the creditor repossesses the property, the debtor will still be obligated on the remaining balance.

Finally, the debtor may choose to ride-through. Here the debtor will continue to make regular payments as with reaffirmation, but there is no written agreement re-obligating the debtor to the debt. This means two things: First, the creditor is not required to report to the credit report. Second, if the debtor later loses the property, the remaining debt falls back into the bankruptcy case and is discharged. It also should be noted that some lenders do not allow ride-through.

The assets that are subject to the Statement of Intention requirement are often highly important to the debtor, if not necessary to his or her post-bankruptcy financial growth. Deciding which option to choose takes thorough planning and prioritizing, as well as knowledge of the law.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Student Loans and Bankruptcy Law

In today’s tough job market, people with higher education degrees are finding it difficult to obtain work. Many of these people also have significant student loan debt. Student loan payments can be extremely difficult to make, especially if a person is not receiving any income. There are many options available to help people with government backed, and even some private, student loans. The main options are deferment, income-based & income-contingent repayment plans, and extended repayment periods. These options can go a long way towards helping a person who doesn’t have a job or someone who had to take a lower-paying job than they expected. However, the deferment periods are of a limited duration and income-sensitive plans can really draw out the length of time a person spends in repayment. Individuals who remain in financial difficulty even after utilizing these options may consider filing bankruptcy.

For those individuals, it is important to know that Congress has determined that student loans are not eligible for discharge in Chapter 7 or Chapter 13 bankruptcies unless a person is able to demonstrate to the satisfaction of the bankruptcy court that the loans create an undue hardship on the person and the person’s dependents. Student loans can be included in a Chapter 13 payment plan, which can reduce the size of the payments and stop the collection activity, but any amount that remains at the end of either the 3 or 5 year plan is not discharged unless the undue hardship standard is met. As a result of this Congressional stance on student loan repayment, individuals seeking relief from overwhelming student loan debt should consult an attorney before filing bankruptcy.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Keeping Your Car and Home if You File bankruptcy

Many people worry that they will lose their homes or cars if they file bankruptcy. However, in most cases, this is not true and an individual who files bankruptcy will be able to keep his or her home and car. This is because state or federal exemptions can be used to protect a certain amount of equity that a person has in his or her car and home.

In a chapter 13 bankruptcy, a debtor may be able to keep secured property by paying the creditor the value of any equity he or she has in the property. A chapter 13 bankruptcy can even be used to stop a car repossession or home foreclosure by allowing a debtor to catch up on back payments and become current with the loan.

In a chapter 7 bankruptcy, people can also generally keep their homes and cars. However filing bankruptcy will not get rid of the security interest that a lender has in the property. This means that although a person’s legal obligation to repay the loan goes away after a bankruptcy, the lender can still take back the property if the person fails to continue making payments on the loan. A person who wants to keep his or her car or home after bankruptcy can keep the property by either signing a reaffirmation agreement with the lender, continuing to make voluntary payments on the loan, or by paying the lender the value of the property. The best option depends on the individual’s unique set of circumstances.

If you are considering filing bankruptcy and have questions about protecting your home or car, contact a local bankruptcy attorney for help.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Discharging Tax Debt in your Chapter 7 Bankrutpcy

People filing for chapter 7 bankruptcy protection often wonder whether or not their income tax debts will be discharged. The good news is tax debts are dischargeable if certain criteria are met.

First, if you want to discharge your tax debt you must have filed returns for the years you owe. Second, the returns were filed at least two years prior to your bankruptcy filing date. Third, the returns in question were due at least three years before you file. Fourth, the IRS or State has not assessed your tax liability within 240 days before the filing. Finally, you did not willfully attempt to evade paying taxes.

However, other types of tax liabilities have different rules. Property taxes are not discharged during Chapter 7 Bankruptcy unless they became due more than a year before your file for bankruptcy. Further, debts incurred to pay taxes cannot be discharged. For example, if you use a credit card to pay your taxes you will have to pay back the creditor who issued the card even if all your other debt is discharged. Finally you may be wondering if tax obligations are dischargeable if you filed late tax returns. The answer is it depends. For a long time the IRS would not allow any taxes owed on late returns to be discharged. However, now the IRS only applies this no-discharge rule to late returns if they were filed within two years prior to your bankruptcy filing.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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What are Exemptions in Bankruptcy?

There is a myth that filing for bankruptcy means you have to give up your assets. This is simply not true. Bankruptcy law lays out specific exemptions which are used to protect your assets when you file for bankruptcy. (Federal exemptions are found in 11 U.S.C. § 522). In your petition you need to list all of your assets. These are all part of the “estate” and become property of the trustee. Exemptions are used to pull your property of the estate and protect it as yours. There are both federal and state exemptions and each state varies. When filing you can either choose one or the other, you cannot mix and match. There are also rules as to which state’s laws you are allowed to use based on where you live. Your attorney will usually be the one to choose what is best for your circumstances. In general, federal exemptions cover more items because of the “wildcard exemption.” Most exemptions are for specific items, but the wildcard can be used on any property up to $12,725 (depending on the amount of equity in your home).

The most common reason to use Minnesota exemptions, specifically, is if you have a home with a lot of equity. Minnesota has a large homestead exemption to protect your home, which is one of the most important assets to people and the most important to protect. If you need to use Minnesota’s exemptions, you may end up with “non-exempt” property. This means that you are not able to protect it and it will become part of your estate for the trustee. The most common non-exempt items are tax refunds and bank account balances. If you have a few non-exempt items it is not something to worry too much about. In most cases a tax refund is small in comparison with the amount of debt being discharged. Just because an item is “non-exempt” doesn’t mean you will lose it. You can pay the trustee to keep it, essentially buying it back from the trustee. Please consult an attorney, as the exemption laws are very technical and may result in loss of property if they are not used correctly.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Even Pro Athletes File Bankruptcy

Many of us know the tale of Michael Vick: one of the most dynamic and talented football players of our generation, who earned more than $200 million dollars over his career only to see it all disappear. Vick was forced to file bankruptcy in 2008 after he found himself more than $20 million in debt, with no real income stream to pay them off (he was banned from the NFL after being convicted of dog fighting and animal cruelty charges in November 2008). Vick is only one of hundreds of pro athletes that have gone broke. A Sports Illustrated article form earlier this year reported that 78 percent of NFL players face bankruptcy or serious financial stress within two years of leaving the game; 60 percent of NBA players face the same financial strife within five years. Why is this?

Pro athletes make millions and sometimes hundreds of millions of dollars over their careers, so it is hard for those of us who will never make close to that understand how athletes could ever find themselves in financial difficulty. One big problem is trust. A lot of athletes came from nothing and do not trust anyone to give tax, legal, and financial advice that could ensure a lifetime of financial stability. Other athletes have the problem of trusting the wrong people and are defrauded of their millions.

Another large problem is pressure from friends and family. Athletes feel obligated to buy expensive houses and cars for those that helped them go pro. They also get a lot of pressure from family and close friends to invest in businesses even when that friend or family member may not have any idea how to run a business. Michael Vick is a prime example of this. He bought a number of cars for friends and family members, a house for his mom, a number of houses for himself. This, among other things, all led to his bankruptcy in 2008. Fortunately for Vick, he landed a $100 million contract the Philadelphia Eagles to help pay off his debts and start over.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Credit Counseling and Debtor Education

When going through the bankruptcy process, there are a few things that you must do; two of which are going through credit counseling and attending a debtor education course. The former must be completed before you file for bankruptcy and the latter must be completed after you have filed for bankruptcy. These two things are by no means optional, they are requirements by the government and you also must make sure you are going to the proper provider. This simply means that the provider who is putting on the credit counseling and debtor education course must be one that is approved within the judicial district you are filing bankruptcy in, as well as one that is approved by the U.S. Trustee Program. You can find a list of approved providers at your local bankruptcy clerk’s office.

As was mentioned above, you must go through credit counseling before you file for bankruptcy and must provide proof that you took the session. The session itself can vary based off of who you decide to do the program through, but most sessions have 3 basic components. The first will be going over your financial condition, then discussing any other options you may have other than bankruptcy, and finally creating a plan to manage your finances. Sessions usually run anywhere from 60 to 90 minutes and cost around $50 (unless you cannot afford to pay and fill out a fee waiver to waive the cost). After finishing your credit counseling session, the provider will present a certificate to you which can be used to provide proof of session completion.

Once you have filed for bankruptcy (and before your debt is discharged), you must then complete a debtor education course. Much like the credit counseling session, each course may vary by provider; they will, however, go over a couple key informational pieces that will be very useful for you after your debts have been discharged. Your course instructor should go over helpful ways to budget and manage your money, as well as how to properly use credit without abusing it. These courses will roughly run about two hours, depending on the provider, and can cost anywhere around $50-$100. There is a fee waiver you can fill out, too, if you are unable to pay for the cost of the course. After you have finished the course, you will be granted a certificate that will provide proof of completing the course.

Just remember, although these requirements may seem bothersome, they are only beneficial for you and your future. They will provide you will helpful tips that you can utilize well after completing bankruptcy.

https://www.consumer.ftc.gov/articles/0224-filing-bankruptcy-what-know

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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The Meeting of Creditors (What to Expect in Minnesota)

About 3 to 5 weeks after you have filed for bankruptcy you will be required to attend a meeting of creditors, which is also known as the 341 meeting.  For some bankruptcy cases, just the meeting of creditors will suffice, in others you may need to appear in court; even if you didn’t need to appear in court, you should take this meeting just as seriously. Another thing to keep in mind is that although the name of the meeting implies creditors will be there, it does not necessarily mean that ALL of your creditors will be there.  Most times you will see only one creditor at these meetings.  In addition to the few creditors that may be present, your lawyer and a bankruptcy trustee will show up as well.  A bankruptcy trustee is somebody appointed by the court to review your case and deal with your estate/assets, they will also be the ones to ask you a series of questions regarding your bankruptcy case during this meeting.

Before heading to your meeting, make sure you have the following items with you: proof of ID, social security number, most recent pay stub, and bank statements.  If you are missing one of these items you will have to reschedule your meeting (especially if you forget your ID or social security number).  If you forget your pay stub or bank statements but your attorney has back-up copies on hand, your meeting can continue as planned.

As mentioned above, the trustee present at your meeting will ask you a series of questions regarding your case.  The following are some areas the trustee may ask about: your assets, property ownership, your bankruptcy petition, whether or not others owe you money, history of payments to creditors, property transfers, domestic support, or previous bankruptcy filings.  These are just a few areas that the trustees might ask about, however, they are not all the areas they may question you on.  These questions may make it seem like this could be a long meeting, but it is quite short.  The meeting of creditors usually lasts around 5 minutes; it is short, brief and is meant to get to the point.

 

https://www.friedmaniverson.com/consumer/blog/bankruptcy/what-should-i-expect-at-my-bankruptcy-meeting-of-creditors/

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Where can I file Bankruptcy?

Figuring out where you can file bankruptcy may seem like a straightforward question.  For most people the state that you currently live in is where your bankruptcy will be filed.  However, if you have recently moved or if you plan to move in the near future, there is more analysis involved.

Bankruptcy laws specify that a debtor’s bankruptcy petition must be filed in the state where the debtor has lived for the majority of the prior 180 days.  Once you move to a new state you must live there for 91 days before you can file bankruptcy there.  This also means that you could move to a new state but still file bankruptcy in your old state for up to 90 days.

The choice of where to file bankruptcy may seem like a simple decision initially but it could have a huge impact on the protection of your assets.  Bankruptcy laws vary from state to state.  Some states only allow debtors to use federal bankruptcy rules for protecting their property.  Other states require debtors to use that state’s specific bankruptcy rules for protecting their property.  Some states, including Minnesota, allow debtors to choose between using federal bankruptcy rules or state rules for protecting their property.

Please call our office at (651) 628-9929 to speak with one of our bankruptcy attorneys at a free consultation.  We have many convenient locations throughout the state of Minnesota.  We would be happy to meet with you in the Twin Cities, Duluth, Rochester, St. Cloud, or Mankato.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Detroit’s Bankruptcy

On July 18, with more than $18 billion in debt, Detroit became the largest U.S. city to file bankruptcy.  They filed under Chapter 9 of the U.S. Bankruptcy Code, which is reserved for municipalities such as cities and towns.  In order to file for Chapter 9 bankruptcy, Detroit needed to prove to a judge that the state of Michigan gave them the approval to file, show that they are unable to pay bills, and prove that the city “negotiated in good faith with creditors.”  The process of filing bankruptcy for this case could take anywhere from months to years depending on whether or not creditors are willing to “agree to concessions ahead of time and the bankruptcy judge decides to expedite the case.”

While waiting out this process, there are a couple of things you may want to know that could impact the individuals of Detroit.  Being as there are more than 23, 000 retirees within the city, the topic of pensions has been at large.  Although a slight possibility, it is not likely that retirees will lose their pensions; however, they could see a reduction in the amount paid per month.  Retirees’ pensions may be protected during this process, but their health care insurance may not be; under Chapter 9, retirees could lose their benefit plans.

Along with side effects that affect individuals, there are outcomes that will affect the city as a whole. If the city so chooses to, they may sell any assets that they own in an attempt to reduce debt; such items could include artwork form the Detroit Institute of Arts.  However, they cannot be forced to take this action.  Another thing to note is that just because the city is filing for bankruptcy, it doesn’t mean that all of their debt will be erased.  Filing for Chapter 9 bankruptcy will only give the city “power to negotiate a debt-reduction deal that could be forced upon bondholders and creditors that previously refused to accept concessions.”  This deal will include a plan to help stabilize their finances and get the city back on track.  However, this plan cannot be put into action until it is “approved by more than half of the creditors in each creditor class and by creditors representing at least two-thirds of the total claims.”  Once this occurs, the city can begin its slow process in reviving its current financial situation.

 

Work Cited

Nathan Bomey. “What to know: How Detroit bankruptcy could unfold.” Detroit Free Press Business. https://www.freep.com/article/20130613/NEWS01/306130030/Detroit-Chapter-9-bankruptcy-Kevyn-Orr.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Can Bankruptcy Help Me with Tax Debt?

Tax debt can be a huge burden for many people. What a lot of people do not know is both Chapter 7 and Chapter 13 bankruptcies can help consumers with tax debt owed to the IRS.  First, it is important to understand the basic differences between the two types of consumer bankruptcy and how tax debt is handled in the different bankruptcy processes.

A Chapter 7 bankruptcy is a great option for people who are unable to make payments on their debt, and are looking for a fresh start to get rid of their unsecured credit cards, medical debts, judgments and other deficiency balances or overdrawn accounts. In a Chapter 7, most tax debt accrued 3 years prior to filing bankruptcy is also dischargeable.

A Chapter 13 bankruptcy is a great option for people who have a little extra income each month that allows them to pay back a portion of their debt to their creditors in a bankruptcy. A Chapter 13 bankruptcy also allows the consumer to pay back any tax debt they owe in more recent years through a manageable monthly payment in the bankruptcy.

Tax debt can be a large portion of a person’s debt and can be the deciding factor in why they ultimately choose bankruptcy as an option to get a fresh start from past debts.  The professional bankruptcy attorneys at Hoglund Law Office are happy to sit down with you to discuss and review your tax debt and discuss your bankruptcy options. Please contact our office to set up a no-cost consultation.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Twitter, Facebook, and Emailing about your Bankruptcy case

Tweeting, Facebook posting, emailing, and even cybersquatting on website domain names can and will affect the outcomes of a pending bankruptcy case.  As tempting as it is to post negative status updates about your creditors or of a debtor’s balance sheet or personal identification information, a person’s best bet is to let knowledgeable and experienced bankruptcy attorneys handle the matter.  Two recent bankruptcy cases (and probably more to come) clearly have demonstrated that it does not pay to announce to the world your involvement in a pending bankruptcy case or attempt to settle the score through electronic means.

A Fourth Circuit case, In Re Jessica J. Bolin, 22 CBN 12, 2012 WL 4062807 (Bankr. D.S.C. 9/13/12) found that email and Facebook notifications involving information pertinent to a pending bankruptcy case do not bode well.  The website designer debtor listed a business owner that had commissioned the debtor to make a website as a creditor in the designer/debtor’s bankruptcy.  The business owner creditor received notice of the debtor’s bankruptcy filing and answered with harassing and negative emails demanding her money.  Additionally, the jilted business owner/creditor conveniently leveraged the debtor’s social security number and posted nasty remarks on the debtor’s personal and business Facebook page, damaging the debtor’s business further.  The creditor ignored the cease and desist requests trying, as hard as she could, to collect the debt owed to her.  Eventually, the judge found for the debtor, holding that the creditor violated the automatic stay provisions and had committed sanctionable offenses with the Facebook posts and harassing emails.  #gottalovepunitivedamages

In Her Inc., et al., v. Barlow (In re David E. and Maria E. Barlow), 22 CBN 20, 2012 WL 4465503 (Bankr. S.D. Ohio 9/26/12), a Sixth Circuit case, a defendant debtor cybersquatted when he registered five Internet domain names in bad faith to “prove a point”.  The debtor-husband acquired domain names that were similar to the plaintiffs’ names and linked website visitors to the plaintiffs’ commercial competitors and critical and disparaging emails that attacked the plaintiffs’ businesses.  The debtor-husband was found to have cybersquatted- that is- registering or using a domain name identical or confusingly similar to another’s registered trademark or service mark with the bad faith intent of making a profit under the Anticybersquatting Consumer Protection Act.  The plaintiffs were awarded $120,000 in statutory damages, as well as attorney’s fees.  The damages were not dischargeable under Section 523 (a)(6) and the Court noted that such fees “are required only in exceptional cases where there is malicious, fraudulent, willful, or deliberate infringement.” #cybersquattingmeansheftystatutorydamages

So instead of damaging or completely throwing your pending bankruptcy case out to the delight of your adversarial creditor, you should “like” Hoglund Law on Facebook and leave the Internet and social media for their intended uses- funny cat videos and tweeting about that awesome dinner your significant other made for you the other night. #Hoglundlaw=Minnesota’spremierbankruptcyattorneys

Sources: In Re Jessica J. Bolin, 22 CBN 12, 2012 WL 4062807 (Bankr. D.S.C. 9/13/12)

Her Inc., et al., v. Barlow (In re David E. and Maria E. Barlow), 22 CBN 20, 2012 WL 4465503 (Bankr. S.D. Ohio 9/26/12)

Consumer Bankruptcy News Volume 23 Issue 1, October 23, 2012

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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How Does Bankruptcy Affect My Credit?

Many individuals fear that filing a bankruptcy will hurt their credit score and prevent them from getting further credit. While there are many factors involved in a company’s decision to provide financial products to an individual that has filed bankruptcy, it is important to remember that persistence will pay off in the long run and knowing your options is key.

It is important to understand the time frame that is involved when filing either a Chapter 7 or a Chapter 13 bankruptcy and how that will affect your ability to repair your credit. Typically, it takes anywhere from one to three years to repair your credit after a bankruptcy has been filed.

One common misconception is that filing a Chapter 13 bankruptcy will affect your credit less than a Chapter 7 because you are paying off your creditors. In a Chapter 13 bankruptcy, you use your income to pay some or all of what you owe to your creditors over time, from three to five years, depending on the size of your debts and income.  A Chapter 13 bankruptcy affects your credit score the same way that a Chapter 7 does, only the time frame for credit repair is greater because you are in the bankruptcy process for three to five years while you are paying off debt to your creditors.

A Chapter 7 bankruptcy, on the other hand, discharges many of your debts and can be filed within a few months. Therefore, the process is much shorter, and the time it takes to repair your credit is less.

It is important to understand your options and how bankruptcy will affect your credit. Knowing your options is crucial to alleviate your fears and misconceptions about the bankruptcy process. Please contact one of our professional bankruptcy attorneys at Hoglund Law Office to discuss your specific situation and find out whether a Chapter 7 or Chapter 13 bankruptcy is right for you.

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Boost in Minimum Wage for Some States

Eight States which include Arizona, Colorado, Florida, Montana, Ohio, Oregon, Vermont, and Washington all raised the minimum wage to keep pace with inflation.  The increase in these States ranged between 28 and 37 cents per hour and will take affect January 1.  More than 1.4 million low-income earners will see their wages go up on New Year’s Day.  While the Federal minimum wage is at $7.25 an hour, workers in Washington State will earn a minimum of $9.04 thanks to their recent wage increase.  18 States total, including Washington, D.C., have rates above the federal level.

The wage increase in the aforementioned states will result in an extra $582 to $770 a year for full-time workers.  The non-profit advocacy group, National Employment Law Project contends that the minimum wage increases will act as a mini-boost to the economy.  The expected increase in wages will result in an increase in those wages being spent, which is projected to add $366 million to the nation’s gross domestic product.  The National Employment Law Project also projects that the minimum wage increases also will result in a creation of more than 3,000 full-time jobs.

Paul Sonn, legal co-director at NELP states, “Increasing minimum wage is a key form of local stimulus.”  The increase in wages will put money back into the pockets of low-income families who will then spend that money at the local businesses.  Paul Sonn also believes that the eight states that are raising their minimum wage on January 1 are protecting themselves in case Congress can’t reach an agreement to extend the payroll tax break beyond February.  He believes that the boost in incomes for individuals living in those eight states will more than offset the loss that could come from the inability of Congress to extend the payroll tax break.

 

Source:

Blake Ellis, Minimum wage increases for workers in eight states, https://money.cnn.com/2011/12/23/news/economy/minimum_wage_increases/index.htm?iid=Popular (accessed 12/27/11)

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Mixed Feelings on the Current Housing Market

Some economic experts and analysts contend that there is little chance for a housing recovery.  That extremely pessimistic outlook is not based on feelings, but upon solid economic data.  The year of 2011 was a sad story for the housing market.  The market saw record low 30-year mortgage rates with few people taking advantage of the rates to buy new homes.  The New Year is likely to bring much of the same.  Doug Duncan, vice president and chief economist at Fannie Mae, contends that there might be a slight uptick in houses sold but the home prices likely will be down.  This means that although more houses will be sold in 2012, the total amount of money spent on purchases is likely to be the same as in 2011.

Despite the fact that the Federal Reserve has pledged to keep rates low through 2013, many content that because of the high unemployment and the historically low home prices, there will be no recovery of the housing market for the foreseeable future.  Last year saw a total of $1.3 trillion in home lending, which is down from $1.7 trillion in 2010 and $3.3 trillion in 2005.  Another disturbing figure is the fact that much of the $1.3 trillion in home lending last year did not result in new home purchases.  Approximately 4 out of 5 mortgage applications were for refinancing current mortgages.  Borrowers were taking advantage of the historically low rates, which averaged less than 4%, not to purchase new houses, but to refinance their current homes.

Not all analysts predict such doom and gloom for the housing market.  Others are optimistic about the future of the market.  Former top economics advisor to the White House and Wells Fargo & Co., Sung Won Sohn states, “Housing has hit the bottom and has begun to heal slowly.”  The events that have taken place over the past few years have “set the stage for a rebound” as Sung contends.  Whether or not we are to see a recovery in the near future most would contend that given the extreme damage that was inflicted on the housing market any form of recovery is likely to be slow.

 

Source:

E. Scott Reckard, Low mortgage rates likely to continue through 2012, experts say, https://www.latimes.com/business/la-fi-mortgage-rates-20120103,0,2240865.story (accessed 12/4/12)

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Historic Low for Mortgage Rates

In the 40-year history of Freddie Mac’s Primary Mortgage Market Survey, interest rates on a 30-year fixed-rate loan is the lowest it has ever been.  Just in time for the holidays, the mortgage rate on a 30-year mortgage is now 3.94%.  Mortgage rates have been falling over the entire year, and since the beginning of the year, the rate has fallen .9%.  Frank Nothaft, Freddie’s chief economist notes the decrease in rates over the year results in a savings of $1,200 a year for a homeowner with a $200,000 mortgage.

These low rates are resulting in an increase in home sales, which is a good sign for the economy.  This past month saw the greatest new home sales since January.  Senior financial analyst at Bankrate.com, Greg McBride, contends that mortgage rates should remain low for much of 2012.  “For well-qualified buyers, interest rates should be no impediment to home buying in 2012,” said McBride.

Existing homeowners are taking advantage of these historic rates by refinancing their old loans into more affordable ones.  Nearly 80% of all mortgage applications last week came from existing homeowners.  McBride expects that lenders will ease up on borrowing requirements only slightly.  Some lenders are starting to require only a 720 credit score, where previously a 740 credit score was required for the best mortgage rates.  These baby steps will, however, help more people gain access to these historic rates.

 

Source:

Les Christie, Mortgage rates hit another record low, https://money.cnn.com/2011/12/22/real_estate/mortgage_rates/index.htm?iid=HP_LN (accessed 12/22/2011)

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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Dispute over whether Scottie Pippen filed for bankruptcy

Former Chicago Bulls star, Scottie Pippen, most notably known for his time playing alongside Michael Jordan in the Bulls six NBA championships, has filed a multimillion-dollar federal lawsuit Tuesday, December 13, 2011.  The lawsuit claims that several websites and media outlets falsely accused Scottie Pippen of filing for bankruptcy.  CNBC.com was among one of the many news outlets that reported Scottie Pippen’s alleged bankruptcy filing.  CNBC.com had listen Pippen in one of the “15 Athletes Gone Bankrupt.”  The article went on to mention that Pippen had lost $120 million in career earnings, including a $4 million corporate jet.

Scottie Pippen contends that all the reports about his bankruptcy are completely false and still has “substantial net worth, which has not been less than approximately $40 million in the last 10 years.”  The federal lawsuit names Comcast Corp., General Electric Co. and CBS Corp, among others.  The lawsuit contains three claims including negligence, false light and defamation.  The suit seeks approximately $9 million in damages.

 

Source:

Allison Horton, Scottie Pippen files suit against those who said he filed for bankruptcy, https://www.suntimes.com/sports/basketball/bulls/9426888-579/scottie-pippen-files-suit-against-those-who-said-he-filed-for-bankruptcy.html (accessed 12/13/2011)

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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