Resurrecting Your Business

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When I was a child, I regularly visited a local department store. At this lovely business establishment, one could purchase many items including clothing, shoes, and even hotdogs. Sadly, due to competition and other factors, the store closed its doors for the last time several years ago. If the owners of the store had considered bankruptcy options, they might still be meeting customers’ needs today. On this blog, you will learn how to resurrect your business with available bankruptcy alternatives. Regardless of whether you choose to liquidate your assets or reorganize your entity, the opportunity to remain in operation might be an option for you.

What Should You Do If Your Paycheck Is Being Garnished for Child Support?

If your wages are being garnished due to unpaid child support, you might be having a hard time dealing with a smaller paycheck. Luckily, there are things you can do to help the situation. Here are some ideas to consider. 1. Argue the amount owed. Legally, in many states, paychecks can be garnished for child support as soon as the courts decide on the child-support payment schedule. However, in most cases, your paycheck will not be garnished unless your child-support payments are in arrears, meaning late. If your ex has brought a case into court and argued that your support payments are in arrears, you can argue the amount owed. In particular, the courts may take into account the income levels of both parents as well as amounts spent on childcare and health insurance. If you believe that your child support due has been assessed inaccurately, you should bring receipts and proof that you have paid money toward your child’s upkeep in the past. That may reduce the amount that is garnished from your check. 2. Sell assets or take out loans to cover payments in arrears. Rather than skimping to live on a super small paycheck, consider paying off the entire amount that is in arrears. Sell anything that you can, and keep in mind that if you don’t’ sell assets like cars or equipment, your ex may ask the courts to repossess those items to pay your child-support debts. Similarly, if you have savings in a 401(k), IRA or other type of retirement account, you could take a loan or an early disbursement from it to cover...

Deciding When To Throw In The Towel And File For Bankruptcy

Just because you think you can’t pay your debts doesn’t mean you really can’t pay them and should file for bankruptcy. Bankruptcy gives you a way out of a financial quagmire; it does have its disadvantages. For example, it remains on your credit record for many years. Therefore, it’s advisable to analyze your situation carefully and only file for bankruptcy if it is the last resort. Here are three strategies to analyze your financial situation: Inventory Your Assets The first thing is to take stock of all your assets, and put a dollar value on them. Assets such as bank accounts and stocks are easy to evaluate, so you need to put down their exact figures. For other assets, an educated approximation will suffice. If you are expecting a sizable money or valuable asset in the immediate future, include it in the inventory too. After that sum up the values of all the assets so that you can know what you are worth. Add Up Your Liabilities Just like with the assets, you need to list and sum up all your liabilities. This includes mortgages, credit card bills, outstanding car payments, college loan, and even rent due, among others. Don’t forget to include interests on these loans, penalties, and any late payment fees the creditors may charge you because they inflate your debts. Compare the Figures Once you have the two figures, compare their amounts to see which one is bigger. If your assets are more valuable than your debts, then you may get out of your sticky situation with a little reorganization of your finances. This is also...

Understanding Your Bankruptcy Options

If you are in a position such that you are considering bankruptcy, then it is very important that you consider all of your options very carefully. Making the wrong decision can make a bad situation even worse. To help you out, here are some things that you should consider before making a commitment. Could you pay back your debts eventually? The best option for debt relief will almost always be a repayment plan over several years. Ideally, you want to come to an agreement with your debtors that allows you to pay off your debts in a few years. If you are unable to come to an agreement with your debtors directly and use a court to facilitate this process, it becomes something known as a Chapter 13 Bankruptcy. The general gist of a Chapter 13 is that the court will appoint a trustee to oversee your specific case. This trustee will evaluate your means to pay back your debts and help create a regimented plan for eliminating your debt. The job of the trustee is to act as a middleman between you and your creditors, collecting monthly or bimonthly payments from you and giving the proceeds to your creditors. However, in order to undertake a Chapter 13, you need to prove that you will have sustainable, reliable income over the next several years. If you cannot prove that you will be making sufficient money, why should your creditors believe that you can pay them back from those wages? What are your assets worth? If you have no real means of paying your debt with future income, then you...

4 Things to Consider Doing before You File for Bankruptcy

When you’re having a hard time financially, it can affect every area of your life. You may be thinking about filing for bankruptcy, but before you do that, it’s important to take the following actions to see if there are other options for you.  Negotiate with Those You Owe You might be avoiding calls from your creditors, so it may surprise you to learn that talking to them might help you in the long run. Ask whether you are eligible for a reduced payment plan or whether they offer delayed payments for those having financial hardships. The creditors may not be able to help you, but don’t assume this is the case; ask. Talk to Friends and Family If you’re like many people, you avoid talking about your financial problems with other people, even those you are close to. Have an honest talk with your loved ones so that they understand what is happening in your life. Whether they offer to lend you money or not, they may have ideas about how you can handle your financial problems. They can also offer necessary emotional support. If your friends and family do offer to lend you money, be sure to set up a plan to pay them back. That way, they can feel confident about helping you during this time. Consider Starting a Business If you are having a hard time making ends meet, you have likely already thought about getting another job so that you can generate additional income. However, you might not have room in your schedule to work multiple jobs.  That’s why starting a business might work...

SSDI And SSI: What Is The Difference?

If you are interested in applying for Social Security benefits, you may be confused about the differences between SSDI and SSI, or Social Security Disability Insurance and Supplemental Security Insurance. Both of these government-run programs assist people who are disabled to receive payments. These two programs do share some similarities, such as being administered by the Social Security Administration (SSA) and having the same requirements for the determination of a medical disability. However, they are very different programs, each with their own qualifications. To see which program is right for you, read on. Social Security Disability SSD, or Social Security Disability, is for people who have “paid into” the system. You may have noticed the SSD deduction on your pay stub; this is money that has been put aside for you to use if you ever become unable to work at your job. This payment is considered “insurance” and your eligibility for benefits is based on how much you have worked in the past. The eligibility determination converts the years you have worked into work credits, and you must have a certain number of work credits, depending on your age, to qualify for benefits. Generally, you must earn $1,200 to earn one credit, and you must have earned 40 credits, with 20 of them earned in the last ten years, to qualify for benefits. There are special calculations available for workers under 31 years of age, however. Supplemental Security Insurance The SSI program, or the Supplemental Security Insurance program, was designed to meet the needs of people who do not have enough work history to meet the work credit requirements....

What Does The Recent “Conversion Leftovers” Decision Mean For Your Chapter 13 Bankruptcy?

If you’re currently making regular payments to a trustee in conjunction with a Chapter 13 bankruptcy, you may be looking forward to the projected end date of your Chapter 13 plan. However, if you’re instead looking to convert this plan to a Chapter 7 discharge and begin rebuilding your credit more quickly, a recent decision by the U.S. Supreme Court may affect what happens to your case — and this decision could even mean some extra money in your pocket. Read on to learn more about how “conversion leftovers” will now be handled by all federal bankruptcy courts. What are “conversion leftovers”? Whenever you make your required payment to the bankruptcy trustee as part of your Chapter 13 plan, he or she distributes these funds to your debtors in order of priority and type of debt. If, like many Chapter 13 debtors, you decide that a Chapter 7 liquidation is a better option, your case will be converted to a Chapter 7 and any funds remaining in the trustee’s possession will be termed “conversion leftovers.”  In the past, the distribution of these conversion leftovers was unclear. Many trustees would send these funds to secured creditors or other entities who might otherwise not receive any compensation in a Chapter 7 discharge. Others could opt to return these conversion leftovers to the debtor. This varying treatment by bankruptcy courts led to litigation at the federal appellate level, and one case eventually made it to the U.S. Supreme Court.  What did the Supreme Court’s decision in Charles E. Harris III v. Mary K. Viegelahn change about bankruptcy law? This case involved a...

Why Chapter 7 Bankruptcy May Be Better For You Than Chapter 13

If you are getting ready to file for bankruptcy, it may be very confusing deciding which method you should use. While each method has their own benefits, here are two reasons you may consider filing under chapter 7 bankruptcy instead of chapter 13. You Will Have A Financial Fresh Start The main appeal of chapter 7 is how it lets you start over by eliminating many of your major debts. This includes a car payment, mortgage, credit card bills, hospital bills, and even payday advances. Unfortunately, it doesn’t eliminate all debts. You will still have to pay money owed to the IRS, child support or alimony, and any student loans that you may have. This biggest downside to filing chapter 7 bankruptcy is that you need to surrender property associated with these debts. For example, eliminating your mortgage debt means needing to surrender your home, and eliminating your car payment debt requires surrendering your car. So consider how close you are to paying off either of these big items at the time of filing for bankruptcy. Money in your personal savings account will also be surrendered to repay the creditors you owe money to. This only applies to money you have at the time of filing for bankruptcy, and any money you earn after that time is yours and cannot be taken away. Many people prefer Chapter 7 over chapter 13 since the latter requires repaying part of your financial debts. In bankruptcy court, they will consolidate your debts so that you have to make regular payments over several years. It may not be an option if your income...

An Overview On Chapter 7 Bankruptcy

If you are considering filing for bankruptcy, you already know that it’s one of the most difficult decisions you’ll ever have to make. But, bankruptcy gives individuals with financial issues an opportunity to start fresh, and it may be a last resort for some. There are two different types of bankruptcies that individuals can file, Chapter 7 and Chapter 13. This article will give you an overview on Chapter 7 bankruptcy, and why it may benefit you and your personal situation. A Fresh Start When individuals file for Chapter 7 bankruptcy, the individual goal is to allow the debtor a fresh new start. This type of bankruptcy eliminates certain debts, subsequently freeing the debtor from personal liability for the debt. It’s important to keep in mind that some types of debt are not dischargeable, such as student loans, taxes, and child support. If you have liens on your property, like a mortgage or tax lien, they remain active even after the completion and discharge of Chapter 7 bankruptcy. Retains Future Income Any property or income that you receive after you file for Chapter 7 is not included as part of the bankruptcy estate.  However, certain property that you acquire within 180 days after filing for bankruptcy does become part of the estate. This time frame is generally applied to any property you receive from a divorce settlement, proceeds from a life insurance policy, or inherited property.  No Limitations of Debt Total or Repayment Plan Chapter 7 bankruptcy does not impose a limit on the amount of debt you may have, while Chapter 13 bankruptcy does have a limit. Also, Chapter 7...

Filing For Bankruptcy: What Chapter Is Right For You?

Are you currently buried under a mountain of debt that seem impossible to crawl out from under? If so, filing for bankruptcy may allow you to finally break free of this debt and begin enjoying the financial fresh start that you so desperately need and deserve. However, before you are able to enjoy the benefits that come along with filing for bankruptcy, you will first need to determine which type of bankruptcy petition is best suited to your particular needs. For most people, this will mean choosing between the use of Chapter 7 or Chapter 13 bankruptcy. Below you will learn more about how each of these options will impact your current financial situation so that you can choose the option that is right for you. Filing For Chapter 7 Bankruptcy The primary benefit of choosing to file for Chapter 7 bankruptcy is that you will be given the opportunity to completely discharge some of your debts. What this means is that you will no longer be responsible for paying these debts and your creditors will no longer be able to try and collect these debts from you. However, it is important to understand that not all debts can be discharged as part of a Chapter 7 bankruptcy. Chapter 7 bankruptcy petitions address the issue of unsecured debts. These are debts that are assumed without the use of any collateral. For instance, credit card bills and medical bills are both considered unsecured debts, while a mortgage will be considered a secured debt since your home is used as collateral when obtaining a mortgage loan. If the majority of your...

Expensive Eduation: What You Need To Know About Student Loans Before You File For Bankruptcy

In 2014, about 40,000 Americans had student loan debts. Combined, these debts exceed $1 trillion! If you are facing hard financial times and hope that filing for bankruptcy will make your student loans magically disappear, think again. Here is what you need to know about bankruptcy options and how filing affects your student loans. Understanding the Types of Bankruptcies If you choose to file for bankruptcy, you have four options. Chapter 7: This is the most common bankruptcy filing. If you file for Chapter 7 bankruptcy, you “wipe out” nearly all of your debt. Most of your assets will be sold, and the money made goes to your creditors (the people and businesses to which you owe money). If these profits do not pay off everything that you owe, you are discharged of the remaining debts. Chapter 11: This type of bankruptcy is more commonly filed by businesses, but you can also file Chapter 11. Unlike Chapter 7 bankruptcy, Chapter 11 is a “reorganization” attempt; when you file Chapter 11 bankruptcy, you are restructuring your debt in an effort to pay back your debts. Chapter 12 and 13: These two types are essentially the same, but only family farmers can file for Chapter 12. You can file for Chapter 13 bankruptcy if you want to pay back your debts but you do not want to sell your property to accomplish this repayment goal. You will not pay back your creditors in full; your creditors must agree to your repayment plan, but they often accept less than the entire amount that you owe. How Do Student Loans Fit In Bankruptcy?...