Wisconsin Bankruptcy Law

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.

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.

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.

The Milwaukee Business Journal reports that an increasing number of southeastern Wisconsin real estate developers have been forced into a personal bankruptcy in Milwaukee because of Wisconsin bank foreclosures in the commercial sector. The story explains that “Developers typically provide personal guarantees on their commercial mortgages, which means banks eventually pursue the developers personally for a judgment.” In general, a developer that has signed off on a now-defaulted, huge personal note for a commercial property can seek Chapter 7 protection if the lender decides to take the matter to court.

But as we have alluded to previously, Chapter 7 isn’t just for real estate moguls or entrepreneurs that have been undermined by fading property values. For most ordinary, hardworking Wisconsin consumers facing serious financial difficulties, a Chapter 7 bankruptcy in Milwaukee often allows homeowners to remain in their primary residence while the case works its way through court. Exemptions that among other things protect the residence were created in order to provide debtors with the basic essentials needed to help them achieve a fresh start. And during that time, any foreclosure attempts by the lender come to a grinding halt. Perhaps you’ve been downsized out of your job and can no longer afford your high monthly mortgage payments. Protection under the bankruptcy laws of Wisconsin may be an option for obtaining needed debt relief in Wisconsin. A step in the right direction might be to obtain guidance from a debt consolidation lawyer at the initial appearance of financial distress.

In a late January blog posing, we noted that more than 1,000 GM dealerships intended to take post-bankruptcy General Motors to arbitration over the reorganized automaker’s controversial decision to drop their franchises from the sales network. In a new development, GM has decided to reinstate about 600 of them without the need for arbitration. The dealerships left out in the cold, however, still retain the right to their arbitration hearing scheduled to begin later this month.

At this writing, there is no word as to how many Wisconsin dealerships will have the option to keep their doors open. According to the Associated Press, “[GM] said it chose the 661 based on a variety of criteria, including sales and other business factors. The company said it hoped to have every letter of intent with dealerships by Monday. At that point, dealers have 10 days to respond and 60 days to meet a set of criteria that would allow them to stay with GM.” It’s unclear right now whether Chrysler will follow suit with a partial reinstatement of some of its affiliated showrooms.

GM filed for Chapter 11 bankruptcy protection on June 1, 2009–the fourth largest bankruptcy in U.S. history and the largest for an industrial corporation. The smaller, reorganized company came out of bankruptcy as General Motors Company LLC (“the new GM”) about 40 days later, with the federal government owning a 60 percent stake.

A colossus like GM is obviously not the only company that has sought bankruptcy protection in the last year. Businesses large and small, as well as individuals who may be down on their luck, can rebound from financial challenges with the help of a Wisconsin bankruptcy lawyer. A skilled bankruptcy attorney in Milwaukee can present you with options and answer any of your Wisconsin bankruptcy questions.