You may now be able to file a Chapter 7 Bankruptcy in New York City and keep your home if you have under $300,000 in equity in it under proposed new limits in New York. Under the new law, waiting to be signed by the Governor, the exemption limits for a house would be increased from $50,000 for a single filer to $150,000 and from $100,000 for a joint filer to $300,000 for joint filers. That, my friends, is huge. What that effectively means is that if you own a condo, or home in New York City, and your mortgage is, for example, $300,000, your home could be worth up to $600,000 and if you file the Trustee is not allowed to take your home! I can’t tell you how many more clients will be able to get a fresh start in Bankruptcy when this bill goes into effect. Additionally, the exemption for equity in a vehicle will rise from its current exemption of $2400, to $4000! Again, while that may not seem like a ton, most vehicles do not have over $4000 in equity in them, unless you put down a huge downpayment. Lastly, and perhaps most importantly, when you file Bankruptcy in New York, you’ll now be able to chose between the New York laws surrounding Bankruptcy OR the Federal exemption limits. New York previously did not allow you to make this choice. Practically speaking, this helps those without a home more than anything else, because there is a wildcard exemption under Federal Rules. In English, that means that if you have some cash, but no home, chances are you’ll get to keep the cash under the Federal exemption laws (of course each case is different). Very very excited and happy about this as you all should be. Once we hear more news, we’ll absolutely pass it along to you.
Archive for the ‘Business Bankruptcy’ Category
Updated New York Bankruptcy Limits Means Thousands more will be able to keep their homes and cars and still file
Thursday, July 15th, 2010Posted in 401k, Bankruptcy, Business Bankruptcy, Cars in Bankruptcy, Gersh Blog, Homes in Bankruptcy, Jobs and Bankruptcy, Mortgages | View Comments
When should I file for Bankruptcy in New York City?
Tuesday, May 11th, 2010Most of my clients come into my New York City Bankruptcy office and say “I should have done this a while ago and saved myself thousands of dollars.” They say this and I believe what they’re saying is completely accurate. The reason is this: Many people view filing for Chapter 7 Bankruptcy in New York as a completely emotional decision. They figured that they would “never find themselves in this situation:. Or some other clients would say that they felt guilty about discharrging credit card debts when they believed they owed money. While some others mistankanely believed that they would lose their house, car, jobs, pets (yes im serious), you name it. The truth is that had they made the step to file for Bankruptcy months earlier, they would saved hundreds and likely thousands of dollars in minimum payments to credit card companies (when mathematically speaking they wouldnt have been able to pay off the balances for decades (yes im serious). They would have also realized that they could keep their property in almost all instances. And finally, and I think most importantly, they would start rebuilding their credit almost immediately. Because thats what bankruptcy allows a client to do.
Look, no one ever thinks they are going to be the ones sitting in a Bankruptcy meeting and having their debts discharged. Its clearly not a life goal. But that doesn’t mean that once you are in a situation like this, that you should do everything you can to avoid it, even at your emotional and financial peril. had clients who weren’t sleeping for months prior to filing. Clients who refused to use their own checking accounts for fear of having it frozen, or having their wages garnished. What I’m saying is that Bankruptcy affords you a way out of this financial mess with a very straightforward procedure. it allows you to restart your financial life, and in all honesty, your entire life, all over again. So before you fork over your next minimum payment of several hundred dollar to a credit card that you know you’ll never be able to pay Ive off, at least speak to a Bankruptcy attorney as one of your options.
Posted in Bankruptcy, Business Bankruptcy, Cars in Bankruptcy, Gersh Blog, Homes in Bankruptcy, Jobs and Bankruptcy | View Comments
Filing Chapter 7 Bankruptcy in Brooklyn when you have a small business
Thursday, February 11th, 2010Many of my New York City clients have a common question: Can I file for Chapter 7 Bankruptcy in Brooklyn, Manhattan, etc., if I own a small business. The answers, with some caveats as always, is yes.
If you own a small business, the Trustee will likely ask you for tax returns for the last few years the business filed, as well as 6 months to one years worth of bank statements.
The first thing you need to ask yourself is: Does the business have any assets that can be liquidated to pay creditors. Most individuals do not. You have an office and a few computers, but you likely dont have 20k servers or John Deere machines. In that case the Trustee wont care at all about the business and likely wont liquidate a thing. However, keep the type of business you run in mind. If you have a dry cleaning business, youre likely to have a bunch of materials that can be sold for some money. Same goes for a grocery store or a hardware store. Real estate business is more unlikely (unless you have a considerable amount of comissions going in.)
The Chapter 7 Trustee in Brooklyn or wherever will also want to know how much the business has in the operating account. Remember, unlike personal bankruptcy itself, listing your business in a Chapter 7 personal Bankruptcy doesnt come with any exmeptions. If you have 10k in your business account, you cant protect a cent of it (unless its spoken for by other creditors or its their money.) Keep that in mind.
Also look out for incoming monies. Just because your business is flat broke now doesnt mean the Trustee wont ask about monies coming in. If for instance you’re a commission based business, and you have $100 in the bank, but a 20k commission coming in, the Trustee is going to ask about it and want it, so be sure to be cognizant of that before you go see a Bankruptcy Attorney in Brooklyn.
Finally the Trustee will ask if you have partners in the business, as the Trustee cant technically touch the partners share. If the assets in the business are worth 20k but you have three other partners, the Trustee might not touch the assets given the headaches that would come with it.
The bottom line is dont get scared about filing personal Chapter 7 Bankruptcy in New York City if you own a business. Just make sure to speak to us about it before you file so that we can guide you about the proper way to file.
Posted in Bankruptcy, Business Bankruptcy, Gersh Blog | View Comments
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