Wisconsin Bankruptcy Law

Offsetting Necessary Expenses From Income

Sun, 28 Aug 2011 17:26:00 GMT

In a previous blog posting, we discussed the means test and the median family income as they relate to an individual bankruptcy in Wisconsin. The median family income as determined by the federal government varies from state to state and also depends on the size of your family.

The means test in part determines whether a debtor can file a Chapter 7 bankruptcy in Milwaukee (or elsewhere). Or, in the alternative, a Chapter 13 repayment plan. In other words, the means test is a line in the sand a between eligibility for a Chapter 7 liquidation or Chapter 13. In short, it can have huge financial ramifications about what, if anything, you need to pay back in a consumer bankruptcy in Milwaukee.

Before a debtor passes or fails the means test, various items that can be deducted from your income under the bankruptcy laws in Wisconsin. Although each situation has unique aspects, necessary expenses can include taxes, union dues, health and disability insurance, child care expenses, energy costs in excess of the national average, and job-related education, among others. To establish these expenses to the satisfaction of the bankruptcy court, you’ll need organized, valid records for at least six months prior to the bankruptcy filing.

Determining all the applicable exemptions and expenses in a bankruptcy case is a job for a trained professional. Millions of Americans file bankruptcy every year for one reason or another. Lawmakers created the bankruptcy code to help protect honest, hard-working people from suffering through their financial disasters. At the same time, the laws can be very tricky and technical, so it is essential to obtain guidance and input from an experienced Wisconsin bankruptcy lawyer. Do not go it alone.

Bankrupt MLB Club Owes Star Nearly $25 Million

Sun, 28 Aug 2011 17:29:00 GMT

No one needs to hold a bake sale for Yankee’s star Alex Rodriguez, but it turns out that he is an unsecured creditor in the Texas Rangers’ bankruptcy. The Rangers officially filed Chapter 11 in Ft. Worth federal court yesterday, in part to orchestrate the sale of the club (for $575 million) to an investors group led by Hall of Fame pitcher Nolan Ryan and attorney Chuck Greenberg. The Rangers owe the third baseman about $25 million in deferred salary dating back to when A-Rod was a member of the team. He is the top unsecured creditor in the Rangers’ petition followed by five other baseball players. Unsecured creditors in a bankruptcy are those who have no security interest in a debtor’s physical property, and are usually last in line to get paid, if at all. Greenberg told the media, however, that the players will be paid in full.

Unsecured debt is debt that is not backed by collateral. In ordinary circumstances (outside of the world of superstar athletes), this can include unpaid credit cards, medical bills, utility bills, collection accounts, and personal loans. And sometimes a debt settlement can be an effective bankruptcy alternative for an everyday consumer in Wisconsin rather than an overextended sports franchise.

A debt consolidation lawyer can negotiate with unsecured creditors on your behalf perhaps without the need to file a Chapter 7 bankruptcy in Milwaukee. If you are in financial trouble, discuss your options with an experienced Wisconsin bankruptcy lawyer. He or she will work with you to obtain much needed debt relief in Wisconsin.

Your Initial Bankruptcy Consultation

Sun, 28 Aug 2011 17:33:00 GMT

Bankruptcy is not suitable as a do-it-yourself proposition. The bankruptcy laws have a lot of complex technicalities which explains why you need a skilled legal expert to guide you in a personal bankruptcy in Milwaukee or in any other localities in Wisconsin. Here are a few things to keep in mind in an initial consultation with a Wisconsin bankruptcy lawyer.

Fully disclose all financial issues. Don’t hold back. As we discussed in previous blog entries, concealing any financial information is against the law. It can also result in a dismissal of the bankruptcy case, and in some instances can result in the debtor being locked up.

Answer the lawyer’s questions candidly. Some answers may be slightly uncomfortable, but to effectively represent you and provide you with sound legal advice, the lawyer needs you to put all your cards on the table.

Getting a second opinion is fine. As an informed consumer, it’s your prerogative to speak with more than one lawyer, but don’t shop around for another lawyer merely to spin a difficult situation more to your advantage, perhaps by withholding key facts.

A general practitioner or an inexperienced lawyer is not your best advocate. Look for an experienced bankruptcy attorney who practices in the bankruptcy courts ever day. That’s the kind of track record that you need for an individual bankruptcy in Wisconsin.

Finally, your friends and relatives will be very well meaning, but any final decision about filing a Chapter 7 bankruptcy in Milwaukee should be made in close consultation with a skilled legal professional who stays on top of the bankruptcy laws in Wisconsin.

If you need to file bankruptcy, choosing the right lawyer is critical. In many cases, the simple truth is that the more experienced attorney will do a better job, which means getting you the most benefit from filing and avoiding the mistakes that someone less experienced is bound to make.

Judge Sentences Spouse For False Bankruptcy Reports

Sun, 28 Aug 2011 17:35:00 GMT

This blog has been following the case of the now-estranged husband and wife team of daycare providers who apparently hid income after filing a Chapter 7 bankruptcy in Milwaukee. In April, the husband was sentenced to six months in prison for filing false reports. Yesterday, the second shoe dropped, when a federal judge sentence the wife, who had earlier pleaded guilty, to one year behind bars. Both spouses will also have to pay restitution and go on probation after they are released.

The Milwaukee couple originally went Chapter 13 in November 2001. Their case was converted to Chapter 7 in 2004. Separately and together, the couple received thousands of dollars from the state of Wisconsin’s taxpayer-subsidized childcare program during this time that apparently was not disclosed in the bankruptcy paperwork. According to the Milwaukee Journal Sentinel, from 2003 to 2008, the husband received about $725,000 from the state-sponsored program and the wife received about $540,000 just in 2008 alone. The Sentinel notes that “Federal, state and local authorities are investigating dozens of child care providers for possible fraud.” The couple is not charged in this investigation.

Under the bankruptcy laws in Wisconsin, a debtor must reveal all income, property, and liabilities. Concealing any financial information is against the law, and in some cases can result in the debtor wind up being locked up. So it’s a very bad idea to try to engage in any form of creative bookkeeping. If you are considering an individual bankruptcy in Wisconsin, make absolutely sure that you have compiled a complete set of accurate financial records. You must provide your Wisconsin bankruptcy lawyer with all the documents relating to your personal and business debts so that he or she can address your financial needs in full compliance with the law.

Big Increase in First Quarter Wisconsin Bankruptcies

Mon, 07 Mar 2011 04:04:00 GMT

Wisconsin bankruptcies increased by 20 percent in the first quarter of this year, the Milwaukee Journal Sentinel reports. Consumers and businesses filed about 6,000 bankruptcy petitions under the bankruptcy laws in Wisconsin as compared with approximately 5,000 in January-March 2009. Most of these petitions were of the Chapter 7 variety; a Chapter 7 liquidation is the most common form of an individual bankruptcy in Wisconsin. According to the article, “Among those coming to see bankruptcy attorneys are laid-off workers or entrepreneurs who tried to survive by using credit cards to cover costs, hoping the economic downturn wouldn’t continue as long as it has.” Reaffirming some of our recent blog entries, the story also observes that “many small-business owners whose businesses have failed are declaring personal bankruptcy.”

The article notes that Wisconsin residents with good skills and expertise still can’t find work in a down economy despite their best job-hunting efforts: “Lawyers who handle bankruptcy cases said even though more analysts say the economy is turning around, it’s not happening fast enough to prevent people who’ve been fighting to stay afloat from declaring insolvency.”

If your personal and/or business financial affairs have reached the point of no return, a candid, confidential discussion with a debt consolidation lawyer may be extremely beneficial. A Wisconsin bankruptcy lawyer is a good person to have in your corner especially if you are currently unemployed and need debt relief in Wisconsin.

Does Bankruptcy Ruin my Credit Rating?

Sun, 06 Mar 2011 16:13:00 GMT

Many of my Wisconsin bankruptcy clients want to know if the process will have a negative impact on their credit scores. Bankruptcy will not really hurt your credit if your credit rating is already not that great when you file. A better way to view it is that bankruptcy provides you with the opportunity to start rebuilding your credit. You can regain a better credit score even within a two year period of time!

If your credit rating is decent before you file for bankruptcy, then filing will likely affect your score, but there are two main things to keep in mind in that situation. The first is that if you are really struggling and have a great credit score, it is likely that you will not be able maintain that rating on your own anyway if you cannot continue to stay current with your bills. It will only be a matter of time before that score starts going down as the monthly payments you make get harder and harder to manage. The second thing you should remember is that you can rebuild your credit within two years. Bankruptcy does not ruin your credit, and we know ways for you to rebuild in the future.

Bankrupt Candy Maker Gets Second Chance

Sun, 28 Aug 2011 17:40:00 GMT

Good news for Wisconsin consumers with a sweet tooth: As a follow up to a previous blog entry, the bankrupt Milwaukee-area candy company Quality Candy looks like it found a buyer and apparently will stay in business. Family owned Quality Candy, which has been in operation for about 100 years, filed for Chapter 11 bankruptcy in January. It was an unusual bankruptcy filing in that the company reported debts of $3.4 million but assets of about 4.4 million. A group of local investors have submitted a $2.2 million offer to buy the company, which needs the go-ahead of the bankruptcy judge. Quality Candy is also seeking court approval to get out of various leases at area malls. Under the bankruptcy laws in Wisconsin and other states, bankrupt companies for walk away from such leases if the bankruptcy judge approves. In this instance, it would allow the successor company to negotiate better lease terms with the shopping centers.

As we have discussed previously, a business entity can not file for a Chapter 13 bankruptcy in Milwaukee, but Chapter 13 is an option for an individual who is personally on the hook for business debts. If you operate a business that may be drowning in red ink, it may be time to turn to a Wisconsin bankruptcy lawyer for assistance. A Chapter 13 bankruptcy in Milwaukee may be the best way to cut your losses and move forward.

Are Tax Refunds Safe in Bankruptcy?

Sun, 06 Mar 2011 16:11:00 GMT

Many people avoid the personal bankruptcy filing process until after they receive a tax refund check for fear that they might lose the refund. A Chapter 7 bankruptcy filing does not affect your tax refund eligibility. The Bankruptcy Court does not intercept those funds. With the Chapter 13 bankruptcy, however, there is a possibility that you will need to provide half of whatever refund you receive to the Trustee as a part of your plan. Not all cases require this, however. If you are interested in filing a Chapter 13 and are concerned about your refund, we can certainly determine what your plan would entail during our free consultation.

Your House May Be Safe in Chapter 7 Bankruptcy

Sun, 06 Mar 2011 16:10:00 GMT

A home is the largest investment that most Wisconsin residents ever make. When the possibility of personal bankruptcy becomes a consideration, their house becomes top of mind and they want to know if it is at risk. The short answer is, “Maybe.” Filing a Chapter 7 bankruptcy does not mean that you have to surrender your home. There are two types of debt that bankruptcy attorneys look at, secured and unsecured. Secured debts are the types of loans that have some form of real property tied to them. Homes and cars are the best examples of these types of debts. Lenders have more security with these loans because they have the right to take legal action to get the cars or the houses back and resell them if their borrowers default. Credit card debts, hospital bills, or utility bills are examples of unsecured debts. These types of debts have no real property tied to them, and therefore there is not any sort of collateral for the creditor to collect if a borrower defaults. Secured debts are not dis-chargeable if you want to keep the real property, whereas the majority of unsecured debts are completely dis-chargeable in a Chapter 7. What this means is that as long as you stay current with your house payments and continue to make your monthly payments when you are supposed to, it is entirely possible to keep your home and file a Chapter 7 to clear out your unsecured debt.

Video Rental Franchise Goes Bankrupt, Ends Operations

Sun, 28 Aug 2011 17:37:00 GMT

With intense competition from Netflix and others, bricks and mortar video rental stores have really fallen on hard times. Movie Gallery, Inc., the parent company of Hollywood Video filed for bankruptcy protection several months ago and closed several of its Milwaukee-area stores. After defaulting on one of its loans, the company notified the court on May 7 that it will shut down all of its approximately 1,900 remaining locations nationwide, including stores in Cudahy, Racine, and Kenosha. The chain has lost significant market share to the movies-by-mail or via online streaming offered by Netflix or local Redbox rental kiosks. Blockbuster Video has encountered similar issues, and may also wind up in bankruptcy. Blockbuster has already closed a number of its shops around the country.

As these corporations (as well as local small businesses) are finding out, consumer preferences can be fickle. If you own a troubled business in Wisconsin that may not be able to stay afloat in this difficult economic environment, a bankruptcy attorney in Milwaukee can help. A skilled Wisconsin bankruptcy lawyer can assess you assets and liabilities and develop a solution, which can include a Milwaukee small business bankruptcy, geared to your particular needs. While the bankruptcy law, for example, does not permit you to go Chapter 13 as a business entity, the petition can include business-related debts for which you signed a personal guarantee. So an individual bankruptcy in Wisconsin does provide some means for dealing with heavy debts that an individual might have piled up in a business.

Bankruptcy Can Sidestep Home Foreclosure

Sun, 28 Aug 2011 17:44:00 GMT

Last Sunday’s 60 Minutes broadcast created a lot of buzz with its segment about homeowners voluntarily allowing their overvalued mortgages to go into foreclosures. The CBS website explains:

Currently, about seven million homeowners are behind on their mortgages and that number is only getting worse. Banks, with the help of the government, are offering some relief to homeowners who’ve lost jobs and just can’t meet their payments. But there’s a growing number who can pay but are simply walking away from houses that are now worth as little as half of what they paid for them. It’s called "strategic default." People have done the math and decided making those monthly payments is just throwing money away, leaving the mortgage holders – the banks – as zookeepers of an ever-growing parade of white elephants.

But there is another option rather than a "strategic" or other forms of default: it is also possible to avoid Wisconsin bank foreclosures altogether by filing a personal bankruptcy in Milwaukee or in the surrounding area under Chapter 7 or Chapter 13. For one thing, a bankruptcy filing puts the bank’s foreclosure case on hold. Another factor to consider is the Wisconsin homestead exception, which is $150,000 for a married couple which could make your home safe from foreclosure. And even if you are thousands of dollars behind on your payments, a Chapter 13 petition may allow you to spread out the amount that you are behind over five years. This means that you only end up paying a very small percentage of that total every month and as far as your lender is concerned, the loan becomes current once again.

If you fallen behind on your loan payments through no fault of your own, contact a Wisconsin bankruptcy lawyer right away. Depending upon the circumstances, and what exceptions may or may not apply to your particular situation, you may be able to save your house and thereby keep your family under one roof through an individual bankruptcy in Wisconsin.

Former Piston Mahorn In Bankruptcy Court

Mon, 07 Mar 2011 04:06:00 GMT

We discussed the financial challenges facing the Texas Rangers baseball team in yesterday’s posting. The NBA playoffs also overlap with the beginning of the baseball season, and it appears that another retired NBA star is seeking rick mahornChapter 7 protection. Rick Mahorn, who played on the 1989 world champion Detroit Pistons and other teams during an 18-year NBA career, owes about $500,000 to creditors, but in court documents indicate that he has only about $200,000 in assets. Among other things, Mahorn apparently lost his suburban-Detroit home to the bank and owes thousands to the IRS. Although Mahorn makes a good income as a Pistons radio broadcaster, he told the Detroit News that "Like any normal American, I’m trying to find a job to better myself. I’m doing everything possible." One wrinkle in the case is that the bankruptcy trustee has indicated that Mahorn has yet to fully account for his NBA pension and at least one championship ring.

Nevertheless, Chapter 7 protection should allow Mahorn and his wife and five children to obtain a fresh start. According to Mahorn’s attorney, ""Rick’s in a very similar situation to other folks who have lived through bad investments and an uncooperative mortgage company."

Remember, Chapter 7 is an option for consumers from all walks of life. A Chapter 7 bankruptcy in Milwaukee is a way under the bankruptcy laws of Wisconsin that many consumers, usually of more modest income, obtain a financial breather through a full discharge of debts that have grown to an unmanageable level. By filing under Chapter 7 if necessary, an individual bankruptcy in Wisconsin can erase many of your bills, most likely allow you to keep your home and car, and enable you and your family to start over on a more solid financial footing. An experienced Wisconsin bankruptcy lawyer has the wherewithal to present a range of options for obtaining debt relief in Wisconsin.

Are you Facing a Foreclosure Action?

Mon, 07 Mar 2011 03:26:00 GMT

Desperation is an immediate response to being served with foreclosure paperwork. Immediately, you start to wonder how much time you have and if you are going to be kicked out of your house. Wisconsin bank foreclosures have not stopped, and there are many people out there that are faced with the dilemma of trying to keep their homes. The process of foreclosure can be overwhelming and it may be useful to know your rights and what options you might have.

s-FORECLOSURE-largeFirst, it is important to know how you ended up facing foreclosure in the first place. Were you at one time capable of paying your monthly mortgage statements and have since experienced a financial burden such as a job loss that has made it impossible to continue to make those payments? Would you be able to pay your mortgage if everything were to be brought current? It is important to answer these questions to determine whether or not filing a chapter 13 bankruptcy in Milwaukee would actually help you. It is true that a debt consolidation lawyer can bring your loan current so that the threat of foreclosure goes away, but it is important to understand that you will still need to be able to make your normal mortgage payment every month.

If you cannot currently afford the payments, you will want to look into your options of modification to lower the monthly amount and make it more affordable. Bankruptcy attorneys handle these types of situations all of the time, so it may be in your best interest to meet with one to discuss what options you have. Do not wait to talk to someone! The foreclosure will not go away and ignoring it will eat up precious time to address the situation. Learn more about Wisconsin bankruptcy information before it’s too late, and you may be able to save your house!

Creditors May Force MLB’s Texas Rangers Into Bankruptcy

Sun, 28 Aug 2011 17:50:00 GMT

With the baseball season in full swing, the ordinary perception is that owning a professional sports franchise is like a license to print money. Evidently not so. The Hicks Sports Group (HSG), the owners of the Texas Rangers, defaulted on $525 million in debt last year, and unhappy creditors may force the team into involuntary bankruptcy. The team and the creditors have evidently reached a stalemate in negotiations. Amidst this turmoil, Major League Baseball (MLB) may seize the team (under its "best interests of baseball" rule) to orchestrate the sale of the franchise to a group that includes team president Nolan Ryan, the Hall of Fame pitcher. Creditors, however, are said to be dissatisfied with that prospect because of other, higher offers that are on the table. The team owes money to 40 creditors, with the largest being Monarch Alternative Capital.

According to Sports Business Journal.com:

MLB is motivated in part to have the sale completed because it has been supporting payroll at the team since the default. But baseball may also be moving to act now because of worries the creditors could file an involuntary bankruptcy petition. At that point, baseball would not be able to exert the influence it could now, said Irwin Kishner, chairman of the corporate department at New York law firm Herrick Feinstein.

“In bankruptcy court, the judge wants to maximize the assets on behalf of the creditors,” he said.

As part of the deal, apparently the Ryan group is willing to pay HSG for land near the ballpark on which there are no creditor liens, which makes it the preferred buyer from HSG’s point of view.

All high-finance wheeling-dealing is a far cry from what might be involved in, for example, a Milwaukee small business bankruptcy voluntarily entered into by the business owner. Subject to certain unsecured debt limits, a self-employed individual or someone operating an unincorporated business is eligible for Chapter 13 relief under the bankruptcy laws of Wisconsin. By restructuring the amount owed, a Chapter 13 plan allows some debts to be paid off in monthly installments in a three-to-five year period while discharging others. If you operate a business that’s on the verge of closing its doors because the debt load has become unmanageable, contact a bankruptcy attorney in Milwaukee. And depending upon the circumstances, you may be allowed to continue your business during the course of a Chapter 13 bankruptcy in Milwaukee or elsewhere.

Are you Facing a Foreclosure Action?

Sun, 28 Aug 2011 17:47:00 GMT

First, it is important to know how you ended up facing foreclosure in the first place. Were you at one time capable of paying your monthly mortgage statements and have since experienced a financial burden such as a job loss that has made it impossible to continue to make those payments? Would you be able to pay your mortgage if everything were to be brought current? It is important to answer these questions to determine whether or not filing a chapter 13 bankruptcy in Milwaukee would actually help you. It is true that a debt consolidation lawyer can bring your loan current so that the threat of foreclosure goes away, but it is important to understand that you will still need to be able to make your normal mortgage payment every month.

If you cannot currently afford the payments, you will want to look into your options of modification to lower the monthly amount and make it more affordable. Bankruptcy attorneys handle these types of situations all of the time, so it may be in your best interest to meet with one to discuss what options you have. Do not wait to talk to someone! The foreclosure will not go away and ignoring it will eat up precious time to address the situation. Learn more about Wisconsin bankruptcy information before it’s too late, and you may be able to save your house!