Debtor's Transfer of Property to Wife is Fraudulent as Prepetition Planning

A debtor's transfer of his interest in real property to his wife in advance of filing bankruptcy is fraudulent when made with the intent to delay, hinder or defraud creditors. In a process termed "bankruptcy planning" debtors seek ways to maximize exemptions and assets in a bankruptcy. Although there are certain limited exemptions for both real and personal property, overreaching is fraudulent. A debtor may use cash on hand to pay debts that will not be discharged such as child support, spousal support, taxes or secured debt rather than paying unsecured creditors whose claims are likely to be discharged in the bankruptcy. Debtors may convert some non-exempt assets into exempt assets. However, a debtor may not take loans for the purpose of purchasing exempt property, increase unsecured debt in advance of filing or transfer assets to a spouse or other insiders for inadequate consideration. When such transfers are made the court will infer an intent to delay, hinder or defraud creditors. If you are considering bankruptcy you should seek experienced legal counsel immediately in order to fully protect your rights, avoid dismissal of your petition and understand how the bankruptcy laws can help you. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Debtor Must List Creditor On Bankruptcy Petition To Cancel Judgment

If the debtor fails to list a creditor on the bankruptcy petition, the creditor's judgment may not be extinguished unless there is proof the creditor had notice for at least one year and failed to act. The notice requirement permits creditors the opportunity to protect their interests and is a requirement of N.J.S.A. 2A:16-49.1. The statute is designed to prevent judgments discharged by bankruptcy from remaining clouding title. In the event the judgment is a lien on real property the issue of whether the judgment was actually dischargeable in bankruptcy. Dischargeability is affected by the timing of the creditor's levying on the property. In the event a creditor has levied on real property pre-petition, the judgment survives the bankruptcy and is not cancellable. It is critical to remember, the debtor is released through bankruptcy as to personal liability but the debtor's real property is not. Debtors, therefore, may utilize this statutory remedy after waiting one year form their discharge in bankruptcy. However, unless the creditor had notice and failed to avail itself of the right to levy the debtor may not utilize the statutory provision permitting cancellation of the judgment. If you are considering bankruptcy you should seek experienced legal counsel immediately in order to fully protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Lenders Should Avail themselves of Insulation From Liability

Lenders, whether private or public, making repossession would be well advised to petition the court for a rent receiver in the event the lender seeks to re-enter and possess the property prior to foreclosure sale. A lender seeking to obtain rental income from a property, or simple protect the property from further disrepair through occupancy, becomes a mortgagee in possession and subject to full liability in the event a lawsuit arises as a result anyone suffering damages through the use, occupancy or permission to enter the property. A court appointed rent receiver acts as agent on behalf of the lender without subjecting the lender to liability for personal injury victims, building code violations and the like. The rent receiver is also insulated from personal liability and only subject to suit in their capacity as rent receiver. The extent of damages obtainable from either the lender or rent receiver is the sum available to the rent receiver, or lender, through collection of rental income or other income received from operation of the property. If you are foreclosing on a property or facing foreclosure, you should seek experienced legal counsel immediately in order to protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Overhaul to Student Loan Collections Considered

Congress will review the idea of implementing the system used in England for collection of student loans. The current system in the United States often involves debt collection agencies hounding the unemployed without offering mention of available payment deferral programs. The system Congress is pondering will be the use of automatic withdrawals from borrower's paychecks based on their earnings. The withholding would operate like tax withholding or the withholding of child support and alimony by employers when directed by court order. The withholding amount would be at a maximum of 15% of borrower's disposable income after an allowance for living expenses. Proponents hope this will begin to decrease the $1 trillion student loan debt outstanding and eliminate the use of private debt collectors which add hefty fees to the loan balances leaving those responsible for student loan repayment in deeper debt. If you are behind in student loans or other debt you should seek experienced legal counsel immediately in order to protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Retirement Plans Exempt in Bankruptcy

Annuities and other qualified retirement plans are exempt in bankruptcy in order to permit debtor the opportunity to be self-supporting upon retirement rather than relying on government programs for support. The key component to keeping the asset is whether the plan is a qualified retirement plan. A bankruptcy trustee may object to exemptions but only upon providing sufficient evidence rebutting the presumption of validity of the exemption. Section 522(d)(10)(E) of the U.S. Bankruptcy Code sets forth the requirements for the plan as follows: (1) debtor's right to receive payment is on account of age, and (2) the amount to be exempted is reasonably necessary for the debtor's support. If these requirements are met, there is a presumption of validity and the debtor will be able to retain the asset. If you are considering bankruptcy, you should consult an experienced attorney immediately in order to protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Bankruptcy Stay Has Limited Term

Although bankruptcy entitles the filer to an automatic stay, the term of the stay is limited. In the event a debtor's case is dismissed by the bankruptcy court the automatic stay is lifted and the property is once again subject to foreclosure. In the event an appeal of the denial is filed, the stay may be extended during the term of the appeal but only in the event the debtor can demonstrate a likelihood of success on appeal. If you are facing foreclosure, considering bankruptcy or an appeal in a bankruptcy matter, you should seek experienced legal counsel immediately in order to protect your rights. For more information on foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Credit Card Companies Must Submit Specific Proofs To Obtain a Judgment Against You in NJ

Capital One Bank, N.A. filed a complaint in the Essex County Superior Court against Palomino, the debtor, demanding $938.81 due from purchases made using her Capital One Visa card. The debtor's answer to the complaint was simply that she did not owe the money as she never had a Visa account. The trial judge granted summary judgment to Capital One Bank. The New Jersey Appellate Court restated the proof required to obtain a judgment on a revolving credit card debt. According to the prior case of L.V.N.V. Funding, LLC v Colvell, in a collections suit on a revolving credit card account, the creditor must set forth (1) the previous balance; (2) identify all transactions and credits; (3) set forth the corresponding interest rates; (4) set forth the balance on which the charge is computed; (5) set forth any other charges; (6) list the closing date of the billing cycle; and (7) provide the new credit account balance. Additionally, these forms of proof must meet federal requirements relating to credit card billing statements under 15 U.S.C. § 1637(b). If you are facing debt collections, you should consult an experienced consumer debt attorney immediately in order to protect your rights. For more information on debt collections, consumer fraud, foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.