November 24, 2017

Case Closed without Discharge Creates Big Problem for Chapter 7 Debtor

bankruptcy case closed without dischargeDo you have an order of discharge following the completion of your Chapter 7 or Chapter 13 case? If not, you may want to fix this problem now before it bites you later.

Every Chapter 7 or Chapter 13 debtor must attend two credit counseling classes. The first, called the pre-bankruptcy credit counseling course, is required before you can file. Your certificate of completion is your ticket in to the bankruptcy process.

Once you have an active case, however, you must attend a second course called a financial management course, obtain a certificate of completion and have your lawyer file that certificate with the clerk of bankruptcy court.

This financial management course offers tips about how to set up a household budget and how to avoid financial mistakes that resulted in your need to file for bankruptcy in the first place.

If your lawyer does not file this financial management course certificate of completion you will not be eligible for a bankruptcy discharge. Instead, your case will be closed without discharge.

Why is a discharge order so important? It represents a formal order from the bankruptcy judge that all debts which can be eliminated or adjusted have been so modified. This order is binding on all state and federal courts and if a creditor attempts to collect on a discharged debt, you can sue that creditor for damages in a contempt proceeding. [Read more…]

Even the Rich and Famous Sometimes file Bankruptcy

start fresh with bankruptcyJust about everyone acknowledges that the economy has been rough for the last couple of years. Bankruptcies are being filed more than ever, and nearly everyone knows someone going through the process. It may surprise you to learn that filing for bankruptcy is something that even happens among the rich and famous. Money troubles with the wealthy tend to be much more extravagant, and if the individual is famous enough, it’s likely that their bankruptcy story is headline news. In fact, quite recently two major players in the sports world have had to file bankruptcy – that’s right, even millionaires run into money troubles.

A former football player by the name of Warren Sapp ran into one of the most common problems of bankruptcy – he made too many unwise purchases. Warren Sapp’s bankruptcy case is a great example to study because his mistake is very obvious. Sapp was an avid collector of paintings, a luxury that, in combination with a series of poor real-estate choices, led to his downfall.

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