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When it comes to bankruptcy and family law, the justice system can seem like an endless web. We aim to simplify and offer as much insight in to the legal system as possible. Here you will find numerous articles in which we lay out our insight to the justice system. We will cover everything from chapter 7 bankruptcies to how to prepare for your divorce case.

Bankruptcy Filers Beware: Con-Artists Posing As Attorneys

Daniel Usiak - Wednesday, November 18, 2015


Telephone-Scam Soliciting Wire Transfers Prompts NACBA and Vermont Attorney General to Issue Consumer Warning

Across the country, consumers are falling prey to a new scam targeting people who have filed for bankruptcy and others just getting started with the process. Bankruptcy attorneys are joining forces with public officials to sound the alarm bell to unsuspecting consumers.

The con artists are using software that “spoofs” the Caller ID system so that the call appears to be originating from the phone line of the consumer’s bankruptcy attorney. Victims of the scam are being instructed to immediately wire money to satisfy a debt that supposedly is outside the bankruptcy proceeding. Some consumers have been threatened with arrest if they fail to wire money to pay the debt.

In some instances, the perpetrators are using personal information from public filings to identify consumers, assume the identity of their attorneys and sound more convincing by phone. These calls are typically placed during nonbusiness hours, making it difficult for clients to verify the call by getting in touch with their attorney to ask about it.

The National Association of Consumer Bankruptcy Attorneys (NACBA) and its individual members want consumers to know that under no circumstance would a bankruptcy attorney or staff member telephone a client and ask for a wire transfer immediately to satisfy a debt. Nor would the bankruptcy attorney and staff ever threaten arrest if a debt isn’t paid.

Consumers should be advised that legitimate debt collectors and agencies cannot threaten arrest in order to satisfy. If you or a family member receive this kind of call, the best thing to do is to hang up and contact your bankruptcy attorney as soon as possible. Do NOT give out any personal or financial account information to the caller.

To File Or Not To File

Daniel Usiak - Tuesday, November 17, 2015

I recently gave a brief presentation on bankruptcy to the Deacons of a local church. As part of their benevolences they assist parishioners who have financial difficulty. They needed some guidance to identify situations where bankruptcy would be an appropriate solution. The talk also addressed the differences between Chapter 7 and Chapter 13 bankruptcies. What follows is the outline handout for the presentation.

Bankruptcy is a system established by federal law that allows an insolvent honest debtor the opportunity to discharge personal liability of all allowed debts and achieve a financial fresh start.

Chapter 7
  • Usually 4 month process after the petition is filed
  • Usually no payments to the trustee
  • Trustee can liquidate non-exempt assets

Chapter 13
  • 3 to 5 year process after the petition is filed
  • Payments for 3 to 5 years pursuant to a plan approved by the judge
  • Trustee does not liquidate assets
  • Provides discharge of some debts not discharged by Chapter 7

Who can file?
  • Chapter 7, if no bankruptcy discharge in past 8 years and meet income “Means Test”
  • Chapter 13 if no chapter 7 discharge in past 4 years or chapter 13 discharge in past 2 years; also subject to debt limits

Reasons to not file
  • Too many assets
  • Too much income

Alternatives to Bankruptcy
  • Consumer Credit Counseling
  • Debt Settlement

“Capitalism without Bankruptcy is like Catholicism without Hell.”
~ Ziad K. Abdelnour, Economic Warfare: Secrets of Wealth Creation in the Age of Welfare Politics

Qualified Answer

Daniel Usiak - Tuesday, October 27, 2015

Maybe you wonder, like some of my clients did, whether you “qualify” to file for bankruptcy even if you have not missed a payment on your credit cards or other debts. Chances are you are contacting me because you have decided that you owe more debt than you can afford to pay. If that is the case, then bankruptcy is probably a reasonable alternative.

There are some details about your situation that we need to discuss to determine if and when you should file. These include what your household gross income is; the value of your assets; the amount of your debt; are you divorced; and what payments or transfers you have made recently to friends, family or other creditors. The bottom line is whether filing bankruptcy and getting a fresh start will improve the quality of life for you and your family. The best way to determine that is an initial consultation with a bankruptcy attorney. Call for an appointment so we can talk about what is best for you.

Will Bankruptcy Fix the problem?

Daniel Usiak - Monday, July 13, 2015
Will Bankruptcy Fix The Problem?

Many people ask me, “Do I qualify for bankruptcy?” Actually a better question is, “Will bankruptcy fix the financial problem I face?” Usually the person asking that problem can benefit from a bankruptcy fresh start. . . but not always. Nearly every month have to tell one or two potential clients that bankruptcy is not the best course of action for them. Here are some questions to ask in analyzing whether to file or when to file bankruptcy:

  1. Do you have enough debt to justify filing a bankruptcy? You have to consider the price of your bankruptcy, including the attorney’s fees, the court filing fee, and any other costs. Also, the bankruptcy filing remains on your credit report for 10 years. So does the benefit of your fresh start provide enough bang for your buck?

  2. Do you have non-exempt assets that you could lose or have to buy back from the bankruptcy estate? Each state sets its own exemptions, which typically protect the property you need to live and make a living. You can exempt certain assets, usually up to a certain dollar amount, that are not at risk and you keep. These may include retirement accounts, household goods, homestead, cars, tools of a trade, jewelry, and clothing. With your attorney’s help you can determine whether the value of your assets exceed the amount you can claim as exempt and if the amount of any non-exempt assets makes bankruptcy a good or bad choice. Maybe in your situation avoiding bankruptcy or repayment over a few years in a chapter 13 makes more sense than chapter 7.

  3. Have you engaged in transactions that suggest that you should not file or wait before you file? These include transfer of money or other assets to friends or family members, recent use of a credit card, transfer of a credit card balance to another credit card, receiving a bankruptcy discharge in the past 8 years, or recent purchase of a new or used vehicle. There are other transactions that can impact your bankruptcy, so it is critical to accurately and completely disclosure all relevant information to your bankruptcy attorney so your bankruptcy can proceed as smoothly as possible.

You should consult a bankruptcy attorney when you realize that your debt is overwhelming your income to help you recognize the risks and benefits of filing a bankruptcy in your specific circumstances. Your attorney can help you navigate the process well before your bankruptcy is filed.

Is a Chapter 11 Bankruptcy a Good Idea?

Daniel Usiak - Sunday, June 14, 2015
Is Chapter 11 Bankruptcy a Good Idea?

We’re often surprised to read about the latest corporation entering “chapter 11 bankruptcy protection.” The company seemed strong – a corporate titan that was too big to fail. Indeed, chapter 11 is not necessarily a recipe for failure. Corporations often emerge stronger, leaner, and more profitable – as if the entire chapter 11 process was little more than a financial rehab, a haven from the exacting demands of markets, shareholders, and the justice system.

It’s almost never a good idea for an individual to file for chapter 11 bankruptcy. We should know. Take it from all of us at Usiak Law: do not file a chapter 11 bankruptcy unless you absolutely need to.

So who needs to file a chapter 11 bankruptcy? The current standards set the bar at about $1,000,000 of secured debt, or approximately $340,000 in unsecured debt. At this level of debt, individuals no longer qualify for chapter 7 or chapter 13 bankruptcies. The standards change on a quarterly basis, however, so it’s always wise to check the most up-to-date bankruptcy guidelines, and, of course, confer with a competent attorney, before making any legal decisions.

While the chapter 11 debt baselines may sound high, the reality is that for many entrepreneurs or other self-employed Americans, bad luck in business can couple with a misguided corporate structuring arrangement to put someone on the hook for significant debt.

Let us make up an fictitious example of a client who owed multiple millions of dollars after a series of failed real estate deals. Had he structured his business in an alternative way, it might have been possible to avoid such financial exposure – but his business decisions exposed him to significant liability. So significant, in fact, that he was not able to file a chapter 7 or chapter 13 bankruptcy.

Fortunately the chapter 11 protections can still provide the tools to get out of debt. It’s crucial to find a lawyer with appropriate specialization. Many run-of-the-mill bankruptcy attorneys do not handle chapter 7 or chapter 13 filings on a regular basis, so make sure to ask your attorney about his specific experiences before proceeding with your case.