The most important creditor in a Single Asset Real Estate case is the entity’s mortgage lender.  In some deals, the entity has secured financing from second-tier or mezzanine lenders.  The Singe Asset Real Estate entity may also owe debts for taxes, utilities, or property management fees. 

Under the Bankruptcy Code, a Single Asset Real Estate case has the following three characteristics:

• a single piece of real property or project (excluding residential property with less than four units);
• which generates substantially all of the income for the debtor (who is not a family farmer); and
• the company (or debtor) operates no substantial business other than operating the property or project.

A Single Asset Real Estate case is not limited to small projects.  It can include large commercial properties.  Even a large shopping center worth millions of dollars could be Single Asset Real Estate case.  If you are the member or owner of a Single Asset Real Estate entity, there are benefits to filing chapter 11 case.  However, you have a more difficult road than a typical debtor in chapter 11.  Our third and final blog in this series will explore the benefits and difficulties associated with a Single Asset Real Estate case.  

We at Lakelaw know the details of Chapter 11.  David Leibowitz even taught the course on Real Estate Bankruptcy Law to graduate law students at the LL M level at John Marshall Law School.  He was recommended for the job there by former Bankruptcy Judge Ronald Barliant as a result of his practice before him.  Jonathan Brand has had a wide-range of exposure to real estate cases not only at Lakelaw but also during his tenure as a law clerk with two different bankruptcy courts.  Lakelaw is available to answer any of your concerns related to Single Asset Real Estate cases or your other bankruptcy needs.

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A Single Asset Real Estate case can work for a property owner even in these troubled times.  But you have to understand the rules, parameters and guidelines if you want a Single Asset Real Estate case to work for you.  Chapter 11 can help you save your property.  However, Congress amended the Bankruptcy Code to make it easier for banks to foreclose on your property.  They convinced Congress that a company held just to own one parcel of real estate had no real reason to survive.  Congress bought this argument – hook, line and sinker.  So, Single Asset Real Estate cases are challenging, but not necessarily dead on arrival.

We at Lakelaw know the details of Chapter 11.  David Leibowitz even taught the course on Real Estate Bankruptcy Law to graduate law students at the LL M level at John Marshall Law School.  He was recommended for the job there by former Bankruptcy Judge Ronald Barliant as a result of his practice before him.  Jonathan Brand has had exposure to real estate cases not only at Lakelaw but also during his tenure as a law clerk with two different bankruptcy courts.

There are many ways that a Single Asset Real Estate case can fail.  But if you know the rules of the road, you can take advantage of the benefits associated with filing a Single Asset Real Estate case and have your best chance of success.  Let Lakelaw navigate your Single Asset Real Estate case to a road towards recovery.

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In order to better understand that, you want to know what the Bankruptcy Code means by the term “custodian”.

Under the Bankruptcy Code, a “custodian” means:

•  receiver or trustee of any of the property of the debtor, not in bankruptcy
• assignee under a general assignment for the benefit of the debtor’s creditors; or
•  anyone who to takes charge of property of the debtor to enforce a lien against such property, to sell it for benefit of the debtor’s creditors.

Why is this important to you?  Well, it can be vital if somebody repossessed your car just before you filed a bankruptcy case.  This happens pretty often.  The Seventh Circuit Court of Appeals, covering Illinois, Wisconsin and Indiana recently decided in Thompson v. GMAC that a creditor who repossessed a debtor’s car prior to a bankruptcy case but had not yet sold it was a “custodian” .  This was vital to the debtor because under the Bankruptcy Code, a “custodian” must give back to the debtor, or the trustee as the case might be, any property which it may have in its possession on the day the case is filed. 

If you’re thinking about filing a chapter 13 case or keeping your car in a reaffirmation agreement, you can claim that the creditor was acting like a custodian when it took back your car before your bankruptcy.  Make your lawyer get it back.

Lakelaw helps people keep their cars in bankruptcy in Illinois and Wisconsin.

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Unfortunately, we can’t be sure whether or not you’ll be able to keep using your credit cards?

Why? 

Credit cards give you the opportunity to incur debt in the future.  From the standpoint of the credit card company, a credit card is a “financial accommodation.”  Why is this important?  A “financial accommodation” is a special kind of a contract when it comes to bankruptcy. When you file a bankruptcy case, the company which extends you a “financial accommodation” is not under any obligation to continue to do so.  So the credit card company might allow you to keep using it – but then again, it might not. 

If you have “closed end” credit – where you owe money but can’t borrow new money – you’ll have the opportunity to reaffirm the debt and pay it off after bankruptcy.  In exchange, you won’t be held in default and you won’t lose your collateral.  But for “open end” credit, there’s no assurance that you’ll be able to pay as normal and borrow new money after bankruptcy.

So when filing your bankruptcy case, be prepared to move to a cash economy until you rebuild your credit.  And you will rebuild your credit.  Lakelaw Cares and will help you rebuild your credit after bankruptcy.

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There’s a big difference between the two.

Under our Constitution, there is just one bankruptcy law.  It’s federal.  In just one sentence of the Constitution, our Founding Fathers gave the United States federal government gave Congress the exclusive right to regulate both bankruptcy and immigration.  That’s quite an assignment for one sentence.

Even though we practice federal bankruptcy law, Wisconsin law is still very important to our Wisconsin debtors in bankruptcy.  Why?  That’s because all property rights are determined by State law.  In  Wisconsin, unlike Illinois, you get to select whether you’d like to take advantage of Wisconsin exemptions or federal exemptions in a bankruptcy case.  The federal exemptions can be very advantageous if you don’t have any equity in your house.  You can then use the federal homestead exemption to protect personal property.

On the other hand, Wisconsin exemptions have just been amended to be much more liberal.  So planning your bankruptcy case with reference to allowable exemptions is very important.

If you have moved into Wisconsin from another state within the past two years, other state law may decide what you get to keep.  But that’s a different question for a different day.

So remember.  Lakelaw practices bankruptcy law in Wisconsin. Don’t let anyone tell you that they practice Wisconsin Bankruptcy Law.  If they do, run in the opposite direction!!

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Plenty.

Under our Constitution, there is just one bankruptcy law.  It’s federal.  In just one sentence of the Constitution, our Founding Fathers gave the United States federal government gave Congress the exclusive right to regulate both bankruptcy and immigration.  That’s quite an assignment for one sentence.

Even though we practice federal bankruptcy law, Illinois law is still very important to our Illinois debtors in bankruptcy.  Why?  That’s because all property rights are determined by State law.  Not only that, in Illinois, all exemptions – property you can keep in bankruptcy – is determined exclusively by Illinois law. 

Now, if you moved into Illinois from another state, other state or even federal law may decide what you get to keep.  But that’s a different question for a different day.

So remember.  Lakelaw practices bankruptcy law in Illinois. Don’t let anyone tell you that they practice Illinois Bankruptcy Law.  If they do, run in the opposite direction!!

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Well, they could file a chapter 7 bankruptcy – if they qualify through the means test.  Their previous six-months income was still high, but that would change within a short period of time.  They could also try to defeat the presumption they are abusing the system by showing the permanent change in their income since Mom is staying home with the kids.

This would eliminate a lot of debt, but not the debt that’s giving them the most headaches:  Their second mortgage.  It’s a high interest home equity loan.  And the house is worth even less than the first mortgage. So we discussed Chapter 13 as an option.

Despite the huge influence banks have over Congress, the bankruptcy laws still allow a couple to eliminate the second mortgage in the Chapter 13 if the house is worth even less than the first mortgage.  This is fantastic news for our couple because they can stop paying their second mortgage, and pay their chapter 13 Plan instead.  That plan will mean that those creditors will be old news in 5 years, and so will that pesky second mortgage.    It may seem counterintuitive – paying more money saves you more money?  But sometimes that’s just the way it works out. 

For financial relief in Kenosha, Racine, Walworth or Milwaukee, call Lakelaw today at 262.694.7300 and ask for Attorney Ryan Blay or David Leibowitz. 

This post was written by Ryan Blay, Supervising Attorney in Lakelaw’s Kenosha office.

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You have some flexibility, just like the big corporations which file their cases in New York and Delaware.  Once you’ve lived in Wisconsin a little more than 3 months, you can file your case here.  Or you could file your case in Wisconsin right away if most of your property is now located in Wisconsin.

If you just moved to Wisconsin, you can’t use  Wisconsin’s exemption law to figure out what property you can keep.  Chances are, you’re going to use your old state’s rules.  The key factor is where you lived in the 180 day period before the last two years started.  If, like me, you moved recently from Illinois, spending the bulk of that 180 period in the Land of Lincoln, you’d be using the Illinois rules.  Sometimes, however, you may have to use the federal exemptions.  Make sure your lawyer asks you the right questions so that you can get the right answers.

For financial relief in Kenosha, Racine, Walworth or Milwaukee, call Lakelaw today at 262.694.7300 and ask for Attorney Ryan Blay or David Leibowitz. 

This post was written by Ryan Blay, Supervising Attorney in Lakelaw’s Kenosha office.

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If a court enters an order, sometimes, it can be modified or even vacated.  You have to act fast.  Under Bankruptcy Rule 9023, you have only 14 days to ask the court to vacate an order which you think it should not have entered.

This can’t be done in every case.  You have to have a good reason. The main reasons for changing an order are:

• Serious mistake of fact
• Serious mistake of law
• Newly discovered evidence

There’s another Rule, Bankruptcy Rule 9024, which allows post-judgment relief.  But here, you would have to prove:

• Mistake, inadvertence, surprise or excusable neglect
• Newly discovered evidence which could not have been discovered within 14 days of the order
• Fraud, misrepresentation or misconduct by an opposing party
• The judgment is void
• The judgment is satisfied
• Any other reason which justifies relief

At Lakeaw, we want you to get things things right the first time.  But if things go wrong, don’t give up.  You may have hope.  Call us at Lakelaw today at 1 866 LAKELAW (5253529)

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When he arrived at Ellis Island, they changed his name to Leibowitz – to make it more “American” sounding.  Now that’s pretty funny.  People tend to have a hard time with my name, even though it’s rather common now.

There are a lot of people named David Leibowitz around.  There’s a journalist in Phoenix and a stock analyst in New York.  There’s a pastry chef and quite a few physicians too.  There’s even a bankruptcy lawyer named David Leibowitz in London and a state representative named David Leibowitz in San Antonio (his middle name is McQuade – and he’s a personal injury lawyer too – very Texas) – I bet he has a black San Antonio cowboy hat and boots to go along with it.  You’re more likely to find me in hiking boots and a baseball cap.  There’s also a David Leibowitz who is an Assistant United States Attorney in New York.

People spell Leibowitz in a lot of interesting ways:

Like these:

• David Leibowitz
• David Liebowitz
• David Lebowitz
• David Lebowicz
• David Libowich

Lots of people want the “w” in my name to be a “v” and they pronounce it that way too.  Like this:

• David Leibovitz
• David Liebovitz
• David Lebovitz
• David Lebovich

Some people think my name is “David Lee Woods” but most of those people come from the South.

In Chinese, it’s hard to say my name, so they use three Chinese utterances:

• Li
• Bo
• Tze

Here are helpful hints on how to say my name:

It has three parts:

• “Lee”
• “Bow”
• “Itz”

The emphasis is on the first syllable.  Most people can say these three syllables.  And most of my friends and clients can say the whole thing together too.

We at Lakelaw have had the honor to represent people of every nationality imaginable.  We are interested in knowing you and also where your family came from.  We want to know your customs and culture because we want to give you the best possible representation.  If we can, we’ll speak your language.  So just like we want you to know what’s in our names, we want to know what’s in your’s too.  One recent Saturday, we saw people from Mexico, Armenia and India as well as people of Irish and Italian ancestry. 

Lakelaw offers solutions to bankruptcy problems for  people from all over the world – no matter what your name might be.

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