Bankruptcy Law/CHP 7 BK

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Question
I am in the process of gathering all the information I need to meet with an attorney and start the proceedings for a Chapter 7. I have 2 questions for you:

1) I heard that in order to keep your house, you must be current on the mortgage, what about the Home Equity Line Of Credit? I just got current on the 1st but I am about 4 months behind on the equity line. I reside in Florida do I need to be current on that mortgage? Between both mortgages I owe more than my house is worth. My 1st balance is approx $203,000 and the Heloc is $65,500 and my house is worth approx $215,000

2) I am a full-time college student and have recently received student loan money (within the last 30-days). I get the money direct deposited from the college into an account they are affiliated with (totally separate from my personal account). I have used the majority of the money for school and the rest will be used for personal bills/expenses. My question to you is: if my parents were to ACH money into that account in the next couple of days ($1100.00-$2000.00 and I used it to pay bills, pay for the BK etc. would the trustee consider it a loan, even though my parents are giving me the money and what info would I need to supply the attorney with?

Answer
1.  There is no requirement to be current on your mortgages prior to filing a bankruptcy case.  However, if you are behind, you will have to catch up within the time frame prescribed under your state's laws or the mortgage lender can foreclose on the property.

2.  It's either a loan or a gift.  The Trustee doesn't make that determination.  If it's a loan, you should enter into a loan agreement.  If it's a gift then you will need to include that income in the means test analysis.


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Mark J. Markus- California Bankruptcy Attorney

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Mark J. Markus is a Los Angeles bankruptcy attorney who has practiced exclusively bankruptcy law in California since 1991 and is rated A+ by the Better Business Bureau and is AV-rated by Martindale-Hubbell. He represents debtors, creditors, and Trustees in Chapter 7, Chapter 11, and Chapter 13 of the bankruptcy code throughout California.

Experience

Visit our California bankruptcy webpage at http://www.bklaw.com for more information on bankruptcy in general and Mark J. Markus in particular. Many questions are answered on the web page (hint, hint).
The Markus webpage also contains more information on

  • Which Chapter to File,
  • business bankruptcy,
  • chapter 7 bankruptcy,
  • chapter 11 bankruptcy,
  • chapter 13 bankruptcy,
  • Do You Need a Lawyer to File Bankruptcy?
  • Frequently Asked Bankruptcy Questions

    Also visit our Los Angeles bankruptcy blog for interesting articles and much more.



    Organizations
    Central District Consumer Bankruptcy Attorneys Association (CDCBAA) Los Angeles County Bar Association (LACBA) Commercial Law & Bankruptcy Section of the Los Angeles County Bar Association Financial Lawyers Conference (FLC) National Association of Consumer Bankruptcy Attorneys (NACBA) Los Angeles Bankruptcy Forum (LABF) American Bankruptcy Institute (ABI) San Fernando Valley Bar Association (SFVBA)

    Publications
    Central District Consumer Bankruptcy Attorneys Association Newsletter September 2007 (Vol. 1, Issue 2)

    Education/Credentials
    J.D., University of Arizona 1990. B.A. Economics, California State University, Northridge 1986. For more details please click here

    Awards and Honors
    AV Rated by Martindale-Hubbell (http://www.martindale.com) A+ Rated by Better Business Bureau

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