Law Offices of David P. Leibowitz LLC
Lakelaw is a registered assumed name for Law Offices of David P. Leibowitz LLC
It is a good idea to consult with an experienced Chicago bankruptcy attorney before acting. Bankruptcy is a big decision and can provide the financial freedom you desperately need. However, it should not be entered into lightly. Bankruptcy does require planning before you file your case
These are just a few of the mistakes that you should avoid before filing for bankruptcy. If you are considering bankruptcy, you should consult with a Waukegan bankruptcy attorney if you are thinking about filing for bankruptcy in Lake County, Illinois.
Sam and Sally were victims of payday loans in Wisconsin. The payday lenders were sucking large sums of money from their bank accounts every month. Lakelaw filed bankruptcy for Sam and Sally to stop the payday lenders. The automatic stay for bankruptcy in Wisconsin serves as a legal stop sign. If a creditor tries to collect a debt even after we file a chapter 7 case in Wisconsin or even a chapter 13 case in Wisconsin, Lakelaw can sue that creditor for damages and attorneys fees to make them stop.
Bankruptcy stops payday lenders from collecting. Bankruptcy stops payday lenders from taking money from peoples’ bank accounts. But Sam and Sally’s payday lenders ignored the law. They took money from Sam and Sally’s bank account after Lakelaw filed their bankruptcy. Sam and Sally got hit with bank fees and overdraft charges.
Lakelaw informs creditors after a bankruptcy filing our client has filed a bankruptcy case, whether under chapter 7 or chapter 13. This way, the creditor can’t complain they didn’t know about the case. If they keep collecting anyway, it’s a willful violation of the automatic stay. We also tell our clients to stop any automated withdrawals from their bank account. We frequently tell our clients to close their bank accounts and open new ones so the creditors can’t get their hands on their money.
Most honest creditors stop collection right after we file the bankruptcy case. But Lakelaw will sue and collect from those who insist on doing the wrong thing,
Creditors with no notice of filings might not be willingly ignoring the bankruptcy stay when they act, but if they get notice and still refuse to correct their behavior, a court can rule they were liable for their actions after getting the notice.
Lakelaw helps our clients recover money taken from them after filing, even if it means extra time on the phones and fax lines. It’s part of completely representing our clients from start to finish and providing them with true debt relief.
Lakelaw also protects people after bankruptcy taking advantage of consumer protection laws such the Fair Debt Collection Practices Act, the Telephone Collection Practices Act and by enforcing the discharge injunction. After a bankruptcy is complete, creditors can’t collect on claims which arose before the bankruptcy. Lakelaw insists that such creditors stop. And if they don’t we sue them and collect for our clients.
We also help our clients restore credit after bankruptcy by reviewing their credit reports and correcting errors.
When facing financial crisis, whether in Wisconsin or Illinois, let Lakelaw fight for you. Remember, Lakelaw is your financial life-saver ™. We help people with bankruptcy and foreclosure in Illinois and Wisconsin.
You want to file your bankruptcy case right now. Maybe you even found www.filenow.com. If you did, your lawyer has a problem. Your lawyer’s problem now is your problem. If your bankruptcy attorney has been disbarred, you may feel lost and abandoned. Perhaps you’ve paid a large fee. But a disbarred lawyer can’t file your Chicago bankruptcy case.
It’s not right to charge you more for legal services than you agreed to pay. A bankruptcy attorney must give you a contract which describes what he or she will do for you. And then he or she must perform these services. There should be no extra charges for your bankruptcy case unless you agreed to them in writing. And a bankruptcy lawyer in Chicago should handle all normal aspects of your chapter 7 bankruptcy from start to finish for the agreed upon flat fee.
For most chapter 13 cases in the Northern District of Illinois, you’ll sign a form contract called the “Court Approved Retention Agreement.” This is the only agreement allowed if your lawyer wants to receive a $4,000 flat fee for your chapter 13 case. There
can’t be any side deals or side agreements if your lawyer wants a $4,000 flat fee.
What can you do if your Chicago bankruptcy lawyer has been disbarred or convicted of a crime? You can find an ethical, competent, highly acclaimed Chicago bankruptcy attorney at Lakelaw. For example, David Leibowitz is board certified by the American Board of Certification as a consumer bankruptcy attorney and a business bankruptcy attorney even though this is not required to practice law in Illinois. He has been retained as an expert witness in legal malpractice cases concerning consumer bankruptcy. He chaired of the American Bankruptcy Institute’s Consumer Bankruptcy Committee for two years. Now he is coordinating editor of the Consumer Corner column of the American Bankruptcy Institute Law Journal. He has been selected to write on bankruptcy ethics by Bloomberg Law for its soon-to-be-published bankruptcy treatise.
If you have been victimized by a disbarred Chicago bankruptcy attorney, or an Chicago bankruptcy lawyer convicted of a crime, Lakelaw will take over your case at a reduced fee. And we’ll try to recover unearned fees for you too.
And as always, David Leibowitz will represent you with care, kindness, courtesy, respect, professionalism and dedication, just as he has for thousands of clients for almost 40 years.
As an attorney who’s been practicing in consumer bankruptcy for five years now (in Illinois and Wisconsin), it’s heartbreaking and frustrating to see the huge amount of lies and misinformation about bankruptcy.
Some of these mistakes come from gossip or bad experiences in bankruptcy (including lying, bad attorneys, or other frustrations). Others come from rumors spread by the financial services industry to try to keep people out of bankruptcy (even though lenders can write off the uncollectable debt and take a tax break for it). Even worse are errors from hacks – er, attorneys/writers – who blatantly skew statistics and facts about bankruptcy filings for their own purposes. We can assure you that while nothing is ever certain with the law, the overwhelming majority of bankruptcies are successful, peaceful, and bring financial relief to our clients.
Here are some common statements about bankruptcy and the truth.
Statement 1: Why not just settle debt? It’ll be better for your credit report and you won’t have to pay a lawyer to settle debts for 40-50 cents on the dollar.
Answer: If your sole major debt is a $4,000 credit card and you can afford to pay a lump sum of $2,000, a credit card company may take it and waive the rest. To do so, you’ll have to show you have a serious hardship (not just because you don’t feel like paying) and submit financial records to prove it. You’ll also have to come up with a lump sum or a few significant payments, not a long term payment plan. Unless you’re insolvent, you’ll have to pay tax on the forgiven debt. But in the situation above, that’s fine because bankruptcy’s costs for a lawyer and the filing fees would make a bankruptcy unnecessary. Where bankruptcy absolutely becomes necessary is if you are in the same financial situation but have $50,000 worth of credit card debt and medical bills.
Even if you get every card or hospital to settle for 10 cents on the dollar (an unrealistic goal for most clients), and even if you can avoid the tax on the 1099 for the forgiven debt, that’s still at least 2-3 times what you’d pay for a bankruptcy to discharge the debt altogether. With so much debt, settlement is not only unrealistic, but it costs significantly more than a bankruptcy filing. For an attorney not to disclose that is tantamount to malpractice.
2. You cannot discharge student loans in bankruptcy.
Answer: This is another major misstatement, largely perpetrated by student loan lenders. In order to discharge student loans, there is a very high standard (possibly relaxed by a recent decision in the 7th Circuit Court of Appeals for Illinois/Indiana/Wisconsin) where you have to demonstrate a good faith attempt to make payments and a serious reason why it’s impossible to pay anything back. Essentially the situation is for people who are unable to earn a significant income, will likely never have the means to do so, leaving the possibility of repayment fruitless. That’s a high standard for sure, but it’s by no means impossible. (Think a 60 year old disabled person with only $700 per month in social security/disability coming in, with expenses of $1000 per month and $60,000 of outstanding student loans). With or without an attorney, people have successfully discharged significant private and government-backed student loan debt.
3. I want to file bankruptcy, but if I do, I’ll lose my (car, boat, beagles, RV, bank account, retirement accounts, etc.)
This aggravates me this most because it assumes that the point of bankruptcy is to take everything from the debtor. The exact opposite is true: an honest but unfortunate debtor gets a fresh start (in Chapter 7, or a repayment plan in Chapter 13) in exchange for listing, valuing and exempting assets. Every state has a scheme of exemptions (with some, like Wisconsin, allowing federal exemptions, while others, like Illinois, do not). The easiest way to find out what you can maintain: Talk to a competent bankruptcy lawyer. Call us at Lakelaw or e-mail us. Even if we don’t practice in your jurisdiction, we can refer you to a qualified consumer attorney in another area. You’ll be surprised, but typically 90% of Chapter 7 cases or so are no-asset 7 cases where the filing debtor turns over nothing.
The moral of this story: Speak with an attorney and learn the truth before believing what people write and say to scare people away from bankruptcy. It may not be for everyone, but for most debtors, it’s a huge relief and worthwhile decision.
When a bankruptcy is filed, any schedules and statements that aren’t filed with the basic paperwork are due within 14 days from the case filing. For almost everyone, that is plenty of time to gather paperwork, meet with an attorney, and get the rest of the documents in. The Court may extend the deadline on a motion by the debtor under Rule 1007, but it doesn’t automatically have to grant it. The Court needs “cause”. One judge in the Eastern District of Wisconsin has strongly suggested he won’t grant “boilerplate” motions without support.
Judge Halfenger’s decision in the Brown case expressed frustration when the motion simply stated the debtor was “gathering documentation”. There was no affidavit or explanation why the motion was filed on the very last day with no affidavit or support. In plain English, explain why 14 days is not enough, or the Judge may simply say it’s too late and dismiss the case for failure to file required documents.
Don’t let your case get dismissed. File your schedules on time or have a very good reason why not. Speak to a Lakelaw attorney to determine what falls under “cause” to extend the time frame.
A few years ago, the US Supreme Court decided a case called United Student Aid Funds, Inc. v. Espinosa. The decision held that even when a Chapter 13 plan violates the Bankruptcy Code, the creditor must object within a set time or else they won’t get to object later, when the bankruptcy is done. Apparently creditors still haven’t learned.
In a recent decision by Judge Kelley in the Eastern District of Wisconsin, the Court held that the creditor, American Family Mutual Insurance Company, was too late when it moved to reopen a long completed Chapter 13 to challenge an improper plan. Even though the case was completed before the Espinosa decision, the principle still applied.
Creditors who receive a Chapter 13 plan should ALWAYS review them. That is free advice from counsel for Chapter 13 debtors.
“After losing the standing argument in state court, it is beyond frivolous for the Debtors to file bankruptcy, reiterate the same losing arguments and now claim, not only that the Note is invalid, but that the foreclosing creditor and its attorneys are liable for RICO violations for filing the Note as an exhibit to the foreclosure complaint.”
- Rinaldi, et al. v. HSBC Bank USA, N.A., as Trustee, et al. (12-2412, Feb. 22, 2013, Hon. Susan V. Kelley)
As the Eastern District of Wisconsin has made clear over the last year, you cannot litigate and lose a state court foreclosure case, then turn around and relitigate the case in bankruptcy court. The Rooker-Feldman doctrine (as described here in this previous blog post) prevents this second bite at the apple.
This decision was quite thorough because in addition to standard objections to the proof of claim and standing arguments, the debtors/adversary plaintiffs also alleged common law fraud, RICO violations, and other claims against the original lender, the servicer/proof of claim filer, and numerous individuals and law firms. Thus, the judge was required to analyze the merits of each before ultimately dismissing each and every claim.
The moral here: If you believe you are the victim of foreclosure fraud, please contact us immediately. If you have a judgment of foreclosure entered in state court, it is extra important that this be discussed before you decide to challenge it in bankruptcy court. Contact a Lakelaw attorney for more information.
Suppose you file a Chapter 13 Bankruptcy and list all of the creditors you can think of. All is well and good and the judges confirms (approves and signs) the plan to pay the creditors. But little did you know that there was one creditor that was lurking out there, or that was assigned a debt and never received notice of the bankruptcy. They didn’t file a proof of claim before the deadline (usually around 120 days from filing). What happens to them?
Well it depends on where you file. In Illinois, the case of In Re Wright suggests that the creditor is out of luck and can’t file a claim. That means they don’t get paid through the bankruptcy. However, that also means that the debt you owe to them doesn’t get discharged. That’s harsh to both the creditor (who could get paid something, and faster) and the debtor (who wants to discharge the debt, especially if it’s a low payment plan to the creditors!)
One of our Wisconsin judges, Judge Kelley, issued a ruling in a case called In re Washington in which she followed prior law from the Western District of Wisconsin. In her decision, she held that in the following conditions, the proof of claim should be allowed:
“In this case, it is apparent that (1) the Creditor did not receive notice of the Chapter 13 case until after the claims bar date expired; (2) upon learning of the case, the Creditor promptly filed a proof of claim; and (3) the prejudice to the Creditor of disallowing the claim outweighs the prejudice to the other creditors of allowing the claim.”
Unlike Chapter 7, where a failure to list a creditor may not prevent a discharge, Chapter 13 requires notice to creditors and has deadlines. Therefore, if you know of a debt you forgot to list, tell your lawyer and give the creditor notice as quickly as possible to file a claim!
The Bankruptcy Court for the Eastern District of Wisconsin created the MMM (mortgage modification mediation) program about a year and a half ago to help make modifications in Chapter 13s easier. So far, it has had quite a few success stories, and the next step is making sure the program stays strong and allows mediation options for as many homeowners and servicers as possible.
Starting December 1, the fees for the program are increasing to allow mediators more recognition for their hard work. The fees for homeowners will now be $200 to the mediator and $25 to the portal used for document submission. Also, the portal is going to remain a preference, but servicers who don’t use the portal will see language allowing them, in some cases, to continue the mediation program while taking documents by e-mail or other means through their attorneys. The portal is effective and worth the extra cost, but some servicers still struggle to get approval to use it.
As has been our practice for quite some time, the law firm representing the Chapter 13 debtors will pay the fees and the work by the mediator will start only when the fees are in. We ask for the mediation fees from our clients in advance to start the process.
The MMM program can be a huge step to getting through the impossible hurdles some servicers have to get mortgages modified in a reasonable fashion. We hope to keep promoting and improvingthe program as time continues.
In a Chapter 13, most of our clients have two options in making the Chapter 13 plan payments to the Trustee: Payment through a payroll deduction, or payments by certified funds sent monthly. Each works well, but neither is as simple and convenient as payments online.
One of the Eastern District of Wisconsin Chapter 13 Trustees, Thomas J. King, just began implementing an online payment system through his office. Debtors who have Thomas J. King as their trustee can go here to find out how to sign up. Again, this is voluntary, and payments can still be made in the other formats. But it never hurts to have another reliable and easy option.