Facing an upside down mortgage can literally turn anyone’s financial stability upside down as well. An upside down mortgage or when the collateral that secured a mortgage loan is considerably worth less than the balance owed has secured prominent standing in the U.S. real estate market in the past seven years.
Many people who are struggling financially to pay their mortgage, vehicle payments, medical bills and/or credit card debt also end up getting very behind in their utility payments. Disconnect notices from the electric, water, gas and telephone companies fill the mailbox and even payment arrangements become impossible to keep.
In Bankruptcy, an automatic stay protects a debtor from creditors. The automatic stay prevents a creditor from collecting on debts incurred by the debtor. The automatic stay is effective immediately upon the filing of the bankruptcy. As soon as the bankruptcy is filed and a case number is obtained, creditors may no longer pursue judgments, garnishments, foreclosure proceeding, or repossessions. Creditors also must cease all phone calls, letters, e-mails, and any other form of communication with the debtor. It is not legal for them to continue attempts to collect on any debts.
Waste and Recycling News reports that One Source Recycling has shut its doors due to Chapter 7 Bankruptcy. Residents who depended on the recycling service provided by One Source Recycling were surprised and concerned. There was already difficulty in locating nearby recycling centers and residents who traveled to the facility to drop off recyclables will have to find a new place to process the items. The change in service was quite sudden and there was no advance notice to customers.
In today’s economy, many people are facing massive debts, many of which are medical bills. As recently reported in a Chicago Tribune article, some studies estimate that up to half of all reported collections are made up of medical debts. Unexpected health issues, illness, and catastrophic injuries all can result in large hospital bills that people who lack comprehensive hospital insurance simply cannot afford to pay.
The U.S. Trustee became the latest government agency to criticize Solyndra LLC’s plan to repay its debts, saying the bankrupt solar panel maker should disclose whether it is favoring venture capital investors over creditors.
The U.S. Trustee for Delaware, New Jersey and Pennsylvania, an agent of the Department of Justice, said in a court filing that Solyndra should provide more information about the repayment plan, which preserves potential tax benefits for the two investment funds that are sponsoring the bankruptcy plan.
Reuters reported a story about a vote regarding a pension plan of bankrupt U.S. aircraft maker Hawker Beechcraft. The vote will be on a plan to prevent termination of an existing plan worth $195.3 million in pensions that Hawker is liable for paying.
Hawker is negotiating with China’s Superior Aviation Beijing Co on their plans to buy the company for $1.79 billion.
Not every type of debt will be discharged in a Chapter 7 or Chapter 13 bankruptcy filing. The Bankruptcy Code sets aside some debts that Congress decided cannot be discharged due to public policy reasons.
A judge has ruled that a Maryland woman will not have to pay back her law school debt due to her diagnosis of Asperger’s Syndrome.
U. S. Bankruptcy Judge Robert Gordon of the District of Maryland on May 17th ruled that Carol Todd met the often difficult burden of showing that she is incapable of repaying a debt of almost $340,000 in law school loans.
Making the decision to file for bankruptcy can be a difficult decision for many Illinois residents. If you’re considering bankruptcy, learning more about the types of bankruptcy filings may help you understand the process and feel more comfortable with your decision.