Do you think you could owe twice as much as you thought on your car loan? It could be true, if your car loan is owed to a credit union, you owe a large credit card balance to the credit union, and if the dreaded “cross collateral clause” is lurking in the fine print of the car [...]

One of the most enduring myths about the law is that spouses are legally responsible for each other’s debts — but it simply isn’t true, not even in a community property state.  Why, then, do so many people seem to “know” this is so, when it’s just a myth?
The answer probably lies in the nature [...]

Some persons considering filing a chapter 7 or chapter 13 bankruptcy case might be concerned about their level of income being inflated due to working overtime hours, or having a part-time job in addition to their main full-time job.  The concern is that the heightened level of income might render the debtor ineligible for chapter 7 [...]

How is the monthly payment calculated in a chapter 13 bankruptcy case?  For most, the monthly payment under a chapter 13 plan consists of what the debtor can afford to pay, after paying all of the monthly living expenses which are necessary to maintain a normal middle class type lifestyle.
If you thought chapter 13 involved a [...]

Most chapter 13 debtors have probably been informed by their bankruptcy lawyers that the accuracy of their bankruptcy papers is critically important, that they shouldn’t incur new debt without the trustee’s permission, and that they can’t sell valuable property, such as their home, without court permission.  Doing any of these could result in a finding of bad [...]

The chorus is growing — two more appeals courts have ruled that the bankruptcy “means test” (also known as Form B22C) doesn’t establish how much a chapter 13 debtor needs to pay each month into the plan.  Instead, both the Fifth and Seventh Circuit Court of Appeals recently said that the means test only provides a “starting [...]

According to the Eighth Circuit Bankruptcy Appellate Panel, a bankruptcy debtor cannot lose social security benefit payments in a bankruptcy case, even the money is paid as a $17,165 lump sum for past benefits.  In re Carpenter, No. 08-6046 (8th Cir. BAP July 13, 2009), held that section 407 of the Social Security Act excludes such [...]

Think you can always amend the bankruptcy schedules later if it turns out there was more in the bank than was originally listed?  Think again — that’s the message of In re Barrows, No. 09-6003 ((8th Cir. BAP July 10, 2009).  In Barrows, the debtors were not allowed to amend their exemptions, thereby losing over [...]

A surprising result in a California bankruptcy case: an $800,000 house with a monthly payment of $4,446, a motor home with a monthly payment of $396, and a boat with a monthly payment of $760 actually enabled a married couple to successfully file chapter 7.  The court in In re Jensen, 2009 WL 1708229 (Bky.C.D.Cal. [...]

A recent Minnesota bankruptcy court ruling makes it easier for persons with roommates to claim a two-person household, while simultaneously excluding the roommate’s income from use in the means test.
This is important because in some cases, this can result in the debtor’s income being below the state’s median income for a two-person household, thereby relieving the debtor [...]