Lapas Law Offices, PLLCLapas Law Offices, PLLC2025-07-21T12:55:59Zhttps://www.goldsborobankruptcylawyer.com/feed/atom/WordPress/wp-content/uploads/sites/1400661/2020/09/cropped-Favicon-32x32.pngOn Behalf of Lapas Law Offices, PLLC<![CDATA[Navigating rent-to-own in North Carolina]]>https://www.goldsborobankruptcylawyer.com/?p=470492024-08-06T23:46:30Z2024-08-07T23:46:15ZRent-to-own agreements offer a flexible path to homeownership, allowing you to rent a property with the option to purchase it later. In North Carolina, consumer protection laws exist to help you make informed decisions and protect your rights in these transactions. Familiarizing yourself with these laws can help you avoid potential pitfalls and scams.
Key consumer protection laws
The North Carolina Retail Installment Sales Act (RISA) and the Unfair and Deceptive Trade Practices Act (UDTPA) are the primary entities that govern North Carolina's consumer protection framework. These laws require companies to provide written agreements that clearly outline payment schedules, total costs, and any associated fees. Additionally, under these laws, you have the right to cancel the agreement within three business days
What to watch for in contracts
When reviewing a rent-to-own contract, pay attention to the total purchase price, the length of the rental period, and the monthly payments. Ensure there are no hidden fees or charges. Clarify who is responsible for maintenance, repairs, property taxes, insurance, and other expenses to avoid unexpected costs.
Avoiding scams and abuses
Stay vigilant against scams by being cautious of deals that seem too good to be true or demand large upfront payments. Verify the legitimacy of the company or individual offering the agreement by checking reviews and seeking references. Ensure all promises are in the written contract.
Staying informed and protected
Being informed about your rights and obligations is crucial in rent-to-own agreements. Keep copies of all documents and communications related to the transaction. This documentation can be valuable if disputes arise. While rent-to-own can be a viable option for homeownership, careful consideration and attention to detail are essential to protect your interests and financial well-being.
A journey towards informed decisions
Navigating rent-to-own transactions requires diligence and awareness. Each step you take in this journey moves you closer to achieving your homeownership goals while maintaining financial stability.]]>On Behalf of Lapas Law Offices, PLLC<![CDATA[Chapter 11 Bankruptcy: Is It the Right Choice for Your Business?]]>https://www.goldsborobankruptcylawyer.com/?p=470472024-06-03T23:02:13Z2024-06-07T16:01:22ZWhen is Chapter 11 bankruptcy a strong option?
Business owners should consider Chapter 11 bankruptcy when they believe their company has a viable future but needs time and relief from current financial pressures. Unlike Chapter 7 bankruptcy, which involves liquidating assets, Chapter 11 focuses on reorganization. This process can help businesses stay open and avoid the drastic measure of shutting down completely.
What are the benefits of Chapter 11 bankruptcy?
Chapter 11 bankruptcy can benefit businesses facing various financial problems. It can stop foreclosure on business properties, halt lawsuits from creditors and prevent the termination of essential contracts. This can give business owners the breathing room needed to restructure operations and return to profitability.
How can I file for Chapter 11 bankruptcy?
The first step in Chapter 11 bankruptcy involves filing a petition with the bankruptcy court. This petition includes detailed information about the company’s assets, liabilities, income and expenses. After filing, the business continues to operate, but significant decisions will require court approval. This ensures that the business acts in the best interest of its creditors and follows a strict budget.
Will I lose control of my business after filing for bankruptcy?
Chapter 11 bankruptcy offers the advantage of staying in control of the business. While the court may appoint a trustee to oversee certain aspects, the business owner often remains in charge of day-to-day operations. This allows you to implement changes and guide the company back to financial health.
Data from the United States Courts shows that there were 452,990 total bankruptcy filings in the year ending December 2023. This figure goes to show that bankruptcy is a valid and functional solution used to great effect by individuals and business owners throughout the country.]]>On Behalf of Lapas Law Offices, PLLC<![CDATA[Navigating bankruptcy and getting a fresh start in North Carolina]]>https://www.goldsborobankruptcylawyer.com/?p=470452024-04-16T03:05:45Z2024-04-16T03:05:45ZEligibility for Chapter 7 bankruptcy
To qualify for Chapter 7 bankruptcy in North Carolina, you must meet certain eligibility criteria. You must first pass the means test, which compares your income to the state median to determine if you have enough disposable income to repay debts. Additionally, you must undergo credit counseling within six months before filing for bankruptcy.
Key steps in Chapter 7 bankruptcy filing
The process of filing for Chapter 7 bankruptcy involves several key steps. First, you gather the relevant financial documents. These include income statements, tax returns and a list of assets and liabilities. Then, you need to complete credit counseling and fill out the necessary bankruptcy forms, disclosing all financial information accurately. After filing, an automatic stay goes into effect, halting most collection actions by creditors. Finally, a bankruptcy trustee will proceed to oversee the liquidation of assets and distribution of proceeds to creditors.
Chapter 13 bankruptcy as a fresh start
If you have a steady income but are struggling to repay debts, Chapter 13 bankruptcy offers a viable solution. Unlike Chapter 7, Chapter 13 involves creating a repayment plan to gradually pay off debts over three to five years. This option enables you to keep your assets while restructuring your finances.
Benefits of Chapter 13 bankruptcy
Chapter 13 bankruptcy provides several benefits for North Carolinians facing debt troubles. One major advantage is the opportunity to keep valuable assets, such as a home or car, while catching up on missed payments through the repayment plan. Additionally, Chapter 13 can stop foreclosure proceedings and prevent creditors from repossessing property.
The United States Courts report that there were a total of 452,990 bankruptcy filings in the year ending December 2023. This figure illustrates how common bankruptcy is among those struggling with debt, and how viable it can be as a solution.]]>On Behalf of Lapas Law Offices, PLLC<![CDATA[Seeking Legal Help in NC Rent-to-Own Disputes: When to Consult an Attorney]]>https://www.goldsborobankruptcylawyer.com/?p=470432024-02-08T03:38:37Z2024-02-13T03:38:27ZUnresolved disputes
If attempts to resolve a rent-to-own dispute with the other party have been unsuccessful, it might be time to consider legal assistance. Common issues include disagreements over property conditions or payment terms.
Breach of contract
When either the tenant or landlord fails to uphold their contractual obligations, it can lead to a breach of contract. Examples include failure to make payments, refusal to transfer ownership as agreed or neglecting property maintenance responsibilities. If you suspect a breach, seeking legal advice promptly is essential to protect your interests.
Understanding state laws
Rent-to-own agreements in North Carolina abide by specific state laws. Legal professionals possess the knowledge and expertise to interpret these laws. They ensure that your case meets compliance requirements with relevant regulations. This is particularly important when disputes involve legal intricacies that may be challenging to navigate without professional guidance.
Mediation and negotiation assistance
Legal professionals can assist in mediation and negotiation. These measures empower you to seek amicable resolutions without resorting to full-blown legal proceedings. Mediation can be a more cost-effective and efficient way to address disputes.
Seeking legal help in North Carolina rent-to-own disputes is advisable when facing tenant/landlord issues that may affect your quality of life. If you are considering entering into a rent-to-own agreement, the North Carolina Department of Justice provides resources explaining the pros and cons of these arrangements.]]>On Behalf of Lapas Law Offices, PLLC<![CDATA[Keeping your home when filing for bankruptcy]]>https://www.goldsborobankruptcylawyer.com/?p=470412023-12-19T02:45:59Z2023-12-19T02:45:59ZExemptions
North Carolina offers a homestead exemption of $35,000 that allows individuals filing for bankruptcy to protect equity in their primary residence. This exemption only applies to the home in which the filer lives. It increases to $60,000 for a filer over the age of 65 who does not have a spouse.
Understanding the equity in a home is important to understand the exemption. Equity is the difference between the market value of the home and the outstanding mortgage balance. If a home's equity falls within the allowed exemption limit, the filer may be able to keep it throughout the bankruptcy process.
Type of bankruptcy
The type of bankruptcy a person files can impact the fate of the home. Chapter 7 bankruptcy involves the sale of non-exempt assets to pay off creditors. If the home does not have full protection under exemptions, then it could be at risk of seizure to pay the debts.
However, Chapter 13 bankruptcy involves creating a repayment plan over three to five years to address outstanding debts. In this scenario, the filer may have the opportunity to catch up on missed mortgage payments while keeping the home.
Despite filing for bankruptcy, a homeowner must also maintain regular mortgage payments. Using the laws and staying up with payments will play a large role in whether a filer can keep his or her home during and after the bankruptcy process.]]>by adrian<![CDATA[Halloween Creates Some Interesting Legal Issues]]>https://www.goldsborobankruptcylawyer.com/?p=470272023-10-31T20:05:26Z2023-10-31T20:05:26ZHaunted Houses
Going to a Halloween haunted house can be a lot of fun. Large amusement parks may also stage a Halloween fest with park employees dressed as scary characters who then jump out to “frighten” patrons. If a patron is frightened and injures him or herself, can the “haunted house” operator be sued for those injuries?
In Munoz v. Six Flags St. Louis, LLC, 670 S.W.3d 239 (2023), a patron went to Six Flags “Fright Fest”, a Halloween-themed event. The patron knew and appreciated she would get “surprised, startled, scared, and frightened” and the patron understood that people who are suddenly “surprised, startled, scared, and frightened” may have different and unpredictable reactions. During the event, a scary clown jumped out of nowhere and started chasing her. The patron ran for about ten seconds and tripped over an unseen curb injuring herself. The court rejected the patron’s claim because she “assumed the risk” that she could become injured by frightened patrons running from park employees dressed in scary costumes.
In Griffin v. The Haunted Hotel, Inc., 242 Cal. App. 4th, 194 Cal. Rptr.3d 830 (2015), actors in scary costumes jumped out of dark spaces holding scary props for the purpose of frightening the patrons. After seemingly exiting the attraction, an actor brandishing and revving a gas-powered chain saw (the blade had been removed) came after the patron. The patron was frightened because he thought the attraction was over. As the patron turned away, he fell and suffered a broken wrist. In rejecting the patron’s claim, the court said the “very purpose of ‘The Haunted Trail’ was to frighten patrons” and that “[a]t bottom, his complaint here is that Haunted Hotel delivered on its promise to scare the wits out of him.”
Provocative Halloween Costumes in the Workplace
Despite what Cady from “Mean Girls” says about Halloween, some costumes can be trouble for employers. In Devane v. Sears Home Improvement Products, Inc., 2003 WL 22999363 (COA Minn.), the plaintiff came to work on Halloween wearing a doctor costume. The plaintiff’s boorish co-worker unbuckled his pants, pointed to his groin, said to the plaintiff “Here Doctor. It hurts here.” The court agreed that this incident, along with numerous others, constituted sexual harassment and created a hostile work environment.
Right to Insult Your Neighbors
It seems as if Halloween can also bring out the worst in neighbors. In Purtell v. Mason, 527 F.3d 615 (7th Cir. 2008), apparently some homeowners were tired of their neighbor parking a 38-foot RV camper in front of their house. So, the neighbors got an ordinance passed which banned parking large RVs in the driveway. Of course, this did not sit well with the RV owners. So, that Halloween, the RV owners placed “tombstones” in their yard which referenced some of the offending neighbors by name and contained a “year of death” corresponding to the neighbor’s street address. For example:
Bette wasn’t ready Dyean was known for lying
But here she lies So she was fried.
Ever since that night she died, Now underneath these daisies
12 feet deep in this trench, Is where she goes crazy!
Still wasn’t deep enough --1680
For that wenches stench!
--1690
The police were called and one neighbor took exceptional offense at his wife’s name appearing on a “tombstone” so a bit of a ruckus ensued. The police told the homeowner to remove the tombstones or he would be arrested for disorderly conduct. The homeowner initially refused to remove the tombstones but after being handcuffed, reluctantly agreed to remove them. After which, he sued the police department for civil rights violations. As an aside, the appellate court included some pictures in its opinion.
Happy Halloween!]]>On Behalf of Lapas Law Offices, PLLC<![CDATA[Protecting your rights as a rent-to-own tenant in North Carolina]]>https://www.goldsborobankruptcylawyer.com/?p=470172023-10-19T21:40:01Z2023-10-19T21:40:01ZUnderstand your agreement
Protecting your rights starts with thoroughly understanding your rent-to-own contract. Review the terms, including the purchase price, timeline and any tenant obligations. Make sure you comply with the terms, including meeting payment dates and maintaining the property.
Be mindful of unfair terms
Some agreements might include unfair or unreasonable terms. You should address any hidden fees, escalating rent payments or unreasonable conditions for purchasing the property.
Keep detailed records
Maintain copies of all communications with the property owner, including copies of rent payments as well as any disputes that arise. The more documentation you have, the easier it is to support your case if it goes to court.
Know your eviction rights
As a rent-to-own tenant, the state provides some protections against eviction. Your landlord must follow the state’s regulations for proper notification, provide you with an opportunity to resolve the default and receive a court judgment to evict you. You have the right to appear in court to fight the eviction as well.
Approximately 66% of properties in North Carolina are owner-occupied. A rent-to-own contract can provide you the opportunity to become part of that percentage. Understand your rights when it comes to fair treatment and enforcing your contract to help you improve your chances of successful ownership.]]>by adrian<![CDATA[Rent to own contracts in North Carolina]]>https://www.goldsborobankruptcylawyer.com/?p=468622023-10-19T09:15:17Z2023-04-05T19:42:21ZLately, I've seen a lot of advertising imploring consumers to purchase goods through a financing option called "rent to own" or a "lease purchase" agreement. The gist of a "lease purchase" agreement is that a consumer selects the item he or she wishes to purchase. The consumer then enters into an agreement to make periodic payments for that item. Once all the payments are made, the consumer now owns the merchandise. In that respect, it is similar to a regular installment payment contract.But, with a "rent to own" or "lease purchase" agreement, until all the payments are made, the customer has no ownership interest in the property. So, if a customer defaults on payment 34 of a 36 payment "lease purchase" agreement, the leasing company can repossess the property. To further coerce payment, some companies will take out criminal charges as reported here. Most "rent to own" or "lease purchase" agreements state that a consumer can terminate the contract at any time by returning the property to the leasing company. The "rent to own" industry say this feature provides flexibility. But, the fact is that most people only stop making their payments because the payments are unaffordable. In a report here, Federal Trade Commission found that most folks who enter into these "lease purchase" agreements do so with the intent of making all of the payments because they want to own the property. Rent to own agreements can be very expensive. When a comparison is made between the cost of the item purchased and the total amount paid over the life of the "lease purchase" agreement and expressed as an interest rate, the APRs for these "rent to own" agreements can range from 40% to over 150% depending on how the agreement is structured. Some "rent to own" agreements may not comply fully with the applicable law in some areas. If a "rent to own" contract does not comply with the applicable law, there may be some substantial remedies available to a consumer including keeping the property without further payment as well as a return of payments made. A careful review of the contract is necessary to determine if the "lease purchase" agreement does, in fact, comply with the applicable law.This office is happy to review "rent to own" or "lease purchase" agreements from the states in which we are licensed to practice law. Contact our office for a review.
]]>by adrian<![CDATA[Random Audits of Bankruptcy Cases To Resume]]>https://www.goldsborobankruptcylawyer.com/?p=468642023-01-13T19:55:52Z2023-01-13T19:55:52ZThe United States Bankruptcy Administrator for the Eastern District of North Carolina has announced that audits of consumer debtor bankruptcy cases will resume starting on March 13, 2023.Consumer bankruptcy cases are subject to random audit and some bankruptcy cases that exceed certain guidelines may also be designated for audit. If you file bankruptcy, your case is not likely to be audited but the possibility is certainly there. The audit program is designed to serve as an added incentive to debtors to ensure that all of the information required for a bankruptcy case is accurately disclosed. If a case is selected for audit, the auditor will review not only the bankruptcy paperwork but the underlying documents reviewed and used to prepare your bankruptcy paperwork. The audit program further stresses that all of your bankruptcy paperwork is important and must be accurate. So, even though your bankruptcy paperwork is prepared by your attorney's office, you (as the debtor) are verifying by your signature that the bankruptcy petition, schedules and other paperwork filed with your case is accurate.As a debtor in bankruptcy, you are required to cooperate with the auditor if your case is selected for audit. The failure to cooperate with the auditor could result in your case being dismissed or worse. Therefore, you should keep your records used to prepare your bankruptcy case is important. In most instances, auditors do not find any errors or omissions. In fact, the US Trustee's most recent report found that approximately 85% of the audited cases were free of any "material misstatements". We strive to make sure that your bankruptcy paperwork is accurate so that if your case is selected for audit, it will not be a worrisome affair.
But, if errors, material misstatements, or outright fraud is found by an auditor, there can be serious consequences. The United States Trustee (or United States Bankruptcy Administrator such as we have in North Carolina) can make a referral to the U.S. Attorney's office for criminal prosecution or seek to have your discharge denied or revoked. It is important that, as a debtor, you be very forthcoming about your financial affairs. The audit program is a means by which the information that you provided to the bankruptcy case can be verified. It is not worth the risk of being denied a discharge of your debts or worse just to keep some property. ]]>by adrian<![CDATA[Do I Need A Lawyer to File Bankruptcy?]]>https://www.goldsborobankruptcylawyer.com/?p=468572023-11-13T20:17:41Z2023-01-10T20:06:32ZDo I Need A Lawyer For My Bankruptcy Case?
Over the years, I’ve seen this question posted on social media sites, listservs, etc. Someone will post that his bankruptcy case went through without a problem and he did not have an attorney. And that statement may be true. But, if you are facing financial difficulties, wouldn’t you want to know how your case is likely to turn out for you? This is where an attorney experienced in bankruptcy law and practice can help you. Without a lawyer, serious trouble could be waiting.
Every Case Is Different
Bankruptcy cases are seldom routine because every case is different. Debtor A is likely to have different circumstances and different goals from Debtor B. Those different circumstances and goals are going to affect a bankruptcy case.
For example, suppose Debtor A filed a chapter 7 bankruptcy case a couple of years ago. Debtor A filed the case without an attorney. The bankruptcy trustee did not sell Debtor A’s house or car and Debtor A got a discharge from his debts. Debtor A concludes that an attorney is not necessary for bankruptcy. After all, his case went well enough.
Debtor B is considering bankruptcy. Debtor B owns a valuable classic muscle car. Debtor B does not want to lose his car. Debtor B talks to Debtor A who says his bankruptcy case went fine without an attorney. He listed in his bankruptcy paperwork everything he owned and all his creditors and that was that (according to Debtor A).
Debtor B is worried about disclosing his car. He figures if he transfers the car title to a friend (who will sign over the title to Debtor B when the bankruptcy case is over), he need not disclose the muscle car since his friend has the title and “owns” the car. Debtor B does not disclose his car ownership or the title transfer in his bankruptcy paperwork. Debtor B is excited to get rid of his debts and files his case without an attorney.
Unfortunately for Debtor B, the Trustee quickly finds out about Debtor B’s transfer of the car title. As a result, the Trustee requires the friend to give the car to the Trustee which is then sold. The money is then paid to Debtor B’s creditors. Debtor B is most disheartened by this turn of events.
But it gets worse for Debtor B. The sale of his car paid 40% of Debtor B’s debts. Since Debtor B did not disclose his transfer of the car, the bankruptcy court denied Debtor B a discharge of his debts. So, Debtor B not only lost his car, he still has a lot of remaining debt.
But it gets worse still for Debtor B. The bankruptcy system requires that debtors honestly and candidly disclose all of their assets, liabilities, and financial transactions. Debtor B did not do that. So, the Trustee referred Debtor B’s bankruptcy case to the U.S. Attorney for criminal prosecution for bankruptcy fraud. The maximum sentence is 5 years imprisonment and a fine. As many reality television stars have found out, bankruptcy fraud is serious!
An Experienced Attorney Can Help You Reach Your Goals
Debtor B would have done well to retain me for his bankruptcy case. Certainly, I would have advised Debtor B not to do the things he did. Since it appears that Debtor B’s car was worth more than he could exempt, a chapter 13 bankruptcy case would likely have met his goal of keeping his car and getting rid of his debt. Assuming Debtor B accurately disclosed everything and complied with the bankruptcy court’s rules, his remaining debts would be discharged. He would not be facing a possible prison sentence for bankruptcy fraud, either.
Depending on Debtor B's financial circumstances, a chapter 7 case could also have worked. In NC, Debtor B could have exempted up to $3,500 under the motor vehicle exemption and possibly another $5,000 under his "wildcard" exemption. Usually, a chapter 7 trustee will allow a debtor to "purchase" the excess equity in an asset. So, if Debtor B could come up with enough money along with his allowed exemption, he could have gotten all of his debts discharged and still keep his car.
An experienced attorney will listen to what you wish to achieve through a bankruptcy filing. Your goals may or may not be obtainable depending on the circumstances of your case. You stand your best chance with an experienced attorney who will explain how things work. And, just as importantly, why half-baked schemes like the one Debtor B hatched won’t work.
Going it alone without an attorney is probably the biggest mistake that can be made in bankruptcy. An experienced attorney can maximize the relief available to you under the Bankruptcy Code while steering you away from schemes that could result in big trouble.]]>
on is frightened and injures him or herself, can the “haunted house” operator be sued for those injuries?
In Munoz v. Six Flags St. Louis, LLC, 670 S.W.3d 239 (2023), a patron went to Six Flags “Fright Fest”, a Halloween-themed event. The patron knew and appreciated she would get “surprised, startled, scared, and frightened” and the patron understood that people who are suddenly “surprised, startled, scared, and frightened” may have different and unpredictable reactions. During the event, a scary clown jumped out of nowhere and started chasing her. The patron ran for about ten seconds and tripped over an unseen curb injuring herself. The court rejected the patron’s claim because she “assumed the risk” that she could become injured by frightened patrons running from park employees dressed in scary costumes.
In Griffin v. The Haunted Hotel, Inc., 242 Cal. App. 4th, 194 Cal. Rptr.3d 830 (2015), actors in scary costumes jumped out of dark spaces holding scary props for the purpose of frightening the patrons. After seemingly exiting the attraction, an actor brandishing and revving a gas-powered chain saw (the blade had been removed) came after the patron. The patron was frightened because he thought the attraction was over. As the patron turned away, he fell and suffered a broken wrist. In rejecting the patron’s claim, the court said the “very purpose of ‘The Haunted Trail’ was to frighten patrons” and that “[a]t bottom, his complaint here is that Haunted Hotel delivered on its promise to scare the wits out of him.”
Provocative Halloween Costumes in the Workplace
Despite what Cady from “Mean Girls” says about Halloween, some costumes can be trouble for employers. In Devane v. Sears Home Improve
ment Products, Inc., 2003 WL 22999363 (COA Minn.), the plaintiff came to work on Halloween wearing a doctor costume. The plaintiff’s boorish co-worker unbuckled his pants, pointed to his groin, said to the plaintiff “Here Doctor. It hurts here.” The court agreed that this incident, along with numerous others, constituted sexual harassment and created a hostile work environment.
Right to Insult Your Neighbors
It seems as if Halloween can also bring out the worst in neighbors. In Purtell v. Mason, 527 F.3d 615 (7th Cir. 2008), apparently some homeowners were tired of their neighbor parking a 38-foot RV camper in front of their house. So, the neighbors got an ordinance passed which banned parking large RVs in the driveway. Of course, this did not sit well with the RV owners. So, that Halloween, the RV owners placed “tombstones” in their yard which referenced some of the offending neighbors by name and contained a “year of death” corresponding to the neighbor’s street address. For example:
Bette wasn’t ready Dyean was known for lying
But here she lies So she was fried.
Ever since that night she died, Now underneath these daisies
12 feet deep in this trench, Is where she goes crazy!
Still wasn’t deep enough --1680
For that wenches stench!
--1690
The police were called and one neighbor took exceptional offense at his wife’s name appearing on a “tombstone” so a bit of a ruckus ensued. The po
lice told the homeowner to remove the tombstones or he would be arrested for disorderly conduct. The homeowner initially refused to remove the tombstones but after being handcuffed, reluctantly agreed to remove them. After which, he sued the police department for civil rights violations. As an aside, the appellate court included some pictures in its opinion.
Happy Halloween!]]>
y. He listed in his bankruptcy paperwork everything he owned and all his creditors and that was that (according to Debtor A).
Debtor B is worried about disclosing his car. He figures if he transfers the car title to a friend (who will sign over the title to Debtor B when the bankruptcy case is over), he need not disclose the muscle car since his friend has the title and “owns” the car. Debtor B does not disclose his car ownership or the title transfer in his bankruptcy paperwork. Debtor B is excited to get rid of his debts and files his case without an attorney.
Unfortunately for Debtor B, the Trustee quickly finds out about Debtor B’s transfer of the car title. As a result, the Trustee requires the friend to give the car to the Trustee which is then sold. The money is then paid to Debtor B’s creditors. Debtor B is most disheartened by this turn of events.
But it gets worse for Debtor B. The sale of his car paid 40% of Debtor B’s debts. Since Debtor B did not disclose his transfer of the car, the bankruptcy court denied Debtor B a discharge of his debts. So, Debtor B not only lost his car, he still has a lot of remaining debt.
But it gets worse still for Debtor B. The bankruptcy system requires that debtors honestly and candidly disclose all of their assets, liabilities, and financial transactions. Debtor B did not do that. So, the Trustee referred Debtor B’s bankruptcy case to the U.S. Attorney for criminal prosecution for bankruptcy fraud. The maximum sentence is 5 years imprisonment and a fine. As many reality television stars have found out, bankruptcy fraud is serious!
An Experienced Attorney Can Help You Reach Your Goals
Debtor B would have done well to retain me for his bankruptcy case. Certainly, I would have advised Debtor B not to do the things he did. Since it appears that Debtor B’s car was worth more than he could exempt, a chapter 13 bankruptcy case would likely have met his goal of keeping his car and getting rid of his debt. Assuming Debtor B accurately disclosed everything and complied with the bankruptcy court’s rules, his remaining debts would be discharged. He would not be facing a possible prison sentence for bankruptcy fraud, either.
Depending on Debtor B's financial circumstances, a chapter 7 case could also have worked. In NC, Debtor B could have exempted up to $3,500 under the motor vehicle exemption and possibly another $5,000 under his "wildcard" exemption. Usually, a chapter 7 trustee will allow a debtor to "purchase" the excess equity in an asset. So, if Debtor B could come up with enough money along with his allowed exemption, he could have gotten all of his debts discharged and still keep his car.
An experienced attorney will listen to what you wish to achieve through a bankruptcy filing. Your goals may or may not be obtainable depending on the circumstances of your case. You stand your best chance with an experienced attorney who will explain how things work. And, just as importantly, why half-baked schemes like the one Debtor B hatched won’t work.
Going it alone without an attorney is probably the biggest mistake that can be made in bankruptcy. An experienced attorney can maximize the relief available to you under the Bankruptcy Code while steering you away from schemes that could result in big trouble.]]>