Massachusetts Bankruptcy Law Blog

Bankruptcy participants may get a raw deal from creditors

When Massachusetts residents file bankruptcy and debts are discharged or negotiated and paid, the creditors have a responsibility to report back to the credit bureau that the debt has been resolved. However, federal officials believe that this might not be happening.

The United States Trustee Program is investigating some of the largest banks in the nation for ignoring this policy, which is a violation of the federal bankruptcy law. Banks such as Bank of America, Citigroup, Synchrony, JPMorgan Chase and GECapital are among those being investigated.

Chapter 7: Ineligibility requirements

If you plan to file Chapter 7 bankruptcy in Massachusetts, you may not only need to know the eligibility requirements for filing, but knowing the "ineligibility" requirements might be helpful as all.

The first ineligibility requirement is exceeding the earnings limit for your state. If your household income is more than the median for your state, you may be required to file Chapter 13 instead of Chapter 7. Chapter 7 is the bankruptcy of choice for most people because it often results in the majority of your debt being written off, leaving you with a clean, blank slate. Chapter 13, on the other hand, is a repayment plan where most debt is consolidated into one payment that is made monthly to a trustee of the court over a period of time. The Department of Justice contains tables with the current median household income of Massachusetts, as well as other states.

What does it cost to file bankruptcy in Massachusetts?

For Massachusetts residents who can't pay their bills and need to file for bankruptcy, their first question might be: what is it going to cost me to file bankruptcy?

Like almost anything else you file, there are federal filing fees imposed by the government when you file for bankruptcy. Those fees are specific to the type of bankruptcy you choose to file. For personal bankruptcy, the filing fees are:

Tips for dealing with bankruptcy and divorce in Massachusetts

When bankruptcy and divorce come together in Massachusetts, it just adds yet another layer of complexity to an already difficult situation. At times like these, it is critical that you know what rights you have and what legal options you can exercise. This can make the whole process easier. Below are a number of tips that can help you deal with this situation.

To begin with, if your spouse agrees to it, you may want to file for bankruptcy and then file for divorce, rather than doing things the other way around. The reason for this is that the two of you can file for bankruptcy at once if you are married, but you might need to file individually if you have split up.

Author files for bankruptcy while movie is being made

As an author, the woman who writes under the pen-name of Zane has had a lot of success. She has sold millions of novels, and she has also been involved in work on a recent movie. This movie is going to be called "Addicted." Despite this success, though, reports show that the author filed for bankruptcy back in the summer.

Part of the problem appears to be that she owes back taxes, both on the state and federal level. Some accounts put the amount that she owes the Internal Revenue Service at $540,000, though she technically said she did not know how much she owed when filing. On top of that, she owes $337,151.85 to the state of Maryland.

What is a Chapter 13 Bankruptcy Hardship Discharge?

Chapter 13 bankruptcy in Massachusetts is different from a liquidation plan -- used under a Chapter 7 bankruptcy filing -- in that it provides a plan that debtors can then use to absolve their debt. This plan may give them the time and the ability to pay off what they owe.

So, what happens if something outside of their control happens that makes it impossible for them to follow this plan? For example, what if they grow ill and they need their money to pay for treatment, or what if the illness means that they cannot work and earn more money, as was assumed when they started the plan? Is there any way out?

What you need to know about Chapter 11 bankruptcy

We often hear of bankruptcy protection as it relates to individuals who find themselves in trouble with consumer debt. What about businesses who are struggling financially? Massachusetts business owners should be aware that they have many financial options, including Chapter 11 bankruptcy.

Chapter 11 cases resemble private bankruptcies in some ways. First, the business bankruptcy begins with the business owner or legal representative filing a petition with the local bankruptcy court. Some petitions are voluntary -- that is, they are filed by the debtor -- while others are involuntary because they are filed by the business owner's creditors.

Our attorneys help you identify the right bankruptcy services

Are you struggling with financial burdens, but you are afraid to consider bankruptcy as an option? Maybe you have heard bad things about bankruptcy proceedings in Massachusetts -- or perhaps you simply do not know your legal rights in bankruptcy court. No matter your reasons for not seeking debt relief, there comes a time for every individual when the financial challenges simply become too great. Whether you are a business owner or an individual who is overwhelmed with debt, you deserve a fresh start through the bankruptcy process.

You may not think that you are eligible for bankruptcy because you make too much money or have too many real property assets. This may not be the case. The truth is that there are many different types of bankruptcy that are available for residents at all income levels. Our knowledgeable legal team can help identify the correct bankruptcy category for your personal needs, determining the best approach for securing your financial future.

Bankruptcy and divorce topics: What about child support?

Massachusetts residents face financial difficulties for a variety of reasons: consumer debt, overdue taxes, loans and civil judgments. Let's not forget to include child support in that list, as these payments can quickly become overwhelming for someone in financial distress. Mixing bankruptcy and divorce can be a difficult process -- and it is even more stressful when balancing bankruptcy and child support.

Do I have to pay child support after declaring bankruptcy? In general, yes. Bankruptcy provides relief from a variety of debts, including those incurred in the purchase of a home or vehicle. You may even be able to secure a stay, also known as a hold, on actions to collect those debts. This is not possible, however, for child support debts. Bankruptcy operates entirely independently from your child support actions.

The basics of seeking Chapter 7 bankruptcy protection

If you are considering filing for Chapter 7 bankruptcy, you might have a few questions about the way the process works. Liquidation bankruptcy does not have to be intimidating; in fact, it helps scores of people get back on their feet financially every year. Instead of suffering through ongoing money woes, you might benefit from considering Chapter 7 bankruptcy for your own financial situation.

One of the purposes of Chapter 7 bankruptcy is to provide filers with a fresh start. However, there are some eligibility rules; Chapter 7 is not available to everyone automatically. Individual debtors must qualify under a "means test," which evaluates your assets and holdings against your liabilities. After going through that evaluation, you must usually complete credit counseling during the 180-day period before you officially file. This counseling may lead to the development of a debt management plan, which must be submitted to the Massachusetts courts.

NACBA | National Association of Consumer Bankruptcy Attorneys | Boston Bar Association | MBA | American Bankruptcy Institute | NCLC | National Consumer Law Center