Guess that Facebook Page is shaping up.

There’s a lull in my phone calls and appointments today – day after Labor Day. Something to do with the first day of school I would guess. As usual my schedule is very busy starting tomorrow and going about two weeks out, but not today.

So I was able to spend part of the morning working on a “Welcome” tab for my facebook page. There’s a free utility for that, which Kim Komando recently recommended. I trust her recommendations, and this one was as described. It consists of a template, actually a choice of templates, where one can fill in graphics and text with a link to one’s web site. I’m pretty satisfied with mine, which you can find by clicking on this bit of text.

I guess I’m a bit shy when it comes to facebook. To me the whole concept is hard to wrap my brain around. That probably has something to do with my core belief about computers, which is that they are nothing but glorified typewriters. It’s not right for a typewriter to do what facebook does.

What to Bring to a Bankruptcy Hearing

At the outset let me say that this post is about the practices that I encounter here in Minnesota, mostly for cases right here in the Twin Cities. If you are from somewhere else, please consult an attorney in your own jurisdiction. Even though bankruptcy is based on federal law and should be about the same everywhere in the country, there are in fact tremendous variations from one locale to another.

Usually the only hearing there is in a Chapter 7 or Chapter 13 bankruptcy is a little proceeding they call the “Meeting of Creditors.” Sometimes it’s also called the “341” or “341 Meeting,” after the section of the bankruptcy code that sets up the hearing process. In this post when I say “hearing,” I mean this meeting of creditors.

This week I have had a hearing nearly every day, except for Friday when I had two. It is usually simple and short, possibly just five minutes, if the lawyer and the clients are properly prepared. But there’s nothing that can delay it worse or mess it up more than not coming to the hearing with all the required documents.

For most of these the required doucments fall into four categories, sometimes five. Here they are:

1. Driver’s license or goverment photo ID for each debtor.

2. Social security card. It’s surprising how many people can’t find this or have lost it a long time ago. If you absolutely can’t find your card, there are some substitutes that are acceptable. In general you can use anything that you have that has your social security number on it, AS LONG AS IT WAS CREATED BY A THIRD PARTY.

So a pay stub would work, since that is created by your employer. So would a W-2. Trouble is that most pay stubs don’t have the social security number on them anymore. It’s getting harder and harder to find a document that has it. Health insurance cards used to have them, but now most don’t. In this day of identity theft, the items that have a social security number on them are disappearing. About the only thing that I can use reliably is a W-2 or 1099. I usully can’t use a tax return, because that’s considered a self generated document – it’s not from a third party.

3. Most recent paystub from employment for each debtor. That is the pay stub that is most recent as of the date of the hearing, not the most recent stub from before the date of filing. The handout from the court which I have posted on my site says to bring “evidence of current income,” but I’ve never seen a trustee ask for anything other than a pay stub. I’ve never seen a person who gets a pension or unemployment be asked to produce evidence of that at the hearing. My experience also is that self-employed people don’t have to produce anything in this category – not at the hearing at least.

4. Bank statements for all open accounts which show what the balance was on the day the case was filed. If the account is open, you have to produce a statement for it. However, unlike the pay stub, this is not necessarily the most recent statement as of the date of the hearing. Usually the statement that comes in the mail at the beginning of the month following the filing of the case will do the trick. You have to be sure, however, that the date of filing is covered in the period included in the statement. In cases where my clients are unable to get a statment that came in the mail, I tell them to go on line or actually go to the bank and get a statement that includes about two weeks before the date of filing and two weeks after that date. Some of the trustees like to snoop through these statements, and I’m concerned that they would be disappointed if we just came in with one page that gave the balance on date of filing.

5. Additional information if the trustee requests it. The above four items or categories of items are all that’s required for more than 90% of the cases I handle. However, every now and then there will be a case where the trustee sends us a letter asking for more information. This could be almost anything, but the rule I follow is that if the trustee wants it, I tell my clients that we better provide it. Often these letters ask that the material be emailed to the trustee several days before the hearing.

Minnesota Bankruptcy filings Highest in a Decade?

So says today’s Pioneer Press. The headline is “State bankruptcy levels highest in decade.” I found this interesting to say the least, and just spent a bit of time looking at statistics for Minnesota bankruptcy filings on the American Bankruptcy Institute site. I thought I would check it out, because I always thought we had never gotten back to the levels we were at in October of 2005 just before the new law went into effect.

Turns out I was right, or at least I think I was. The Pioneer Press article is apparently comparing the first five months of the year this year with the first five months of every year going back ten years. If you do that, yes this is the highest year ever. However, if you compare the first quarter of this year with the last quarter of 2005, the last quarter of 2005 was significantly higher. I don’t think we have ever really surpassed that big rush we had in late 2005.

I have to admit though, it has been really busy around here. I did just file five cases in the last five days of June. Maybe that’s not a lot for some lawyers, but it’s a lot for me.

Going to Jail for Being in Debt

Everyone I have spoken with all this week has brought up the front page story in last Sunday’s Star Tribune about going to jail for debt. I’m glad that the newspaper is making people aware that this can happen. What you need to know about it, however, is that the procedure is rare and easy to avoid.

In Minnesota nobody is sent to jail for not paying a debt. You can wind up in jail, however, for not obeying a court order. A person who ignores a court order can be found in contempt of court, and the most common penalty for that is a little time – often just a few hours – behind bars. The kind of court order that’s usually involved is one that requires the debtor to respond to a request for information about his or her assets.

When you get sued for a debt in Minnesota, typically a judgment is entered. A judgment is a fancy piece of paper that says you owe the money. After getting a judgment, a creditor has a right to inquire into what assets the debtor has out of which the debt can be paid. Usually this inquiry takes place in the form of written questions or a demand for documents. Typically the debtor will ignore this – for one thing you probably need a lawyer to even figure out what it is. So when there’s no response, the creditor will bring a motion requiring a response. The creditor has a right to a response, so the judge will always order the debtor to respond.

Then the creditor serves the debtor with the court order. By now the debtor has received a large number of legal documents, and this one tends to look the same and just as incomprehensible as the others. The order should be served in person, and a good process server will make a point of showing the debtor that there is a judge’s signature on the document. Of course, a lot of the process servers aren’t so good.

When the debtor ignores the court order, the creditor is in a position to make a motion that the debtor be found in contempt. Another order is served, this one requiring the debtor to show up for the contempt motion hearing. If the debtor fails to show up for that, an arrest order can be issued.

Usually the judge will just have you held for a few hours. Sometimes in an extreme case that can become a few days, perhaps even a few weeks. One way to get a person in such circumstances released is to file a bankruptcy. The automatic stay from the bankruptcy court is usually all it takes to invalidate the legal process that is holding the person in jail. If one brings the receipt for the bankruptcy court filing fee to the judge who has ordered a person to jail, most judges will immediately order that the person be released. Since child support and spousal maintenance are not discharged in bankruptcy, I’m not sure this would work if the contempt of court involved nonpayment of child support or maintenance.

All week I have been trying to reassure people that it’s actually pretty difficult to have this happen and not see it coming in advance, so that we have plenty of time to get their bankruptcy filed before it would ever become a real danger. One moral of the story is that one should never let legal documents pile up without at least consulting somebody about what they mean.

Busy with Bankruptcies

Well, it seems that nearly all I am doing these days is bankruptcy. At least as a practical matter. I have decided that for now it would be best for me to not accept any more probate cases or DWI cases. At least that’s how I feel about it today.

There’s only so much that one guy can do. It’s time for me to start concentrating on one thing, especially since there’s so much of it.

So I thought it was time to change the URL of my blog. It was “mn-bankruptcy-dwi-probate.blogspot.com.” I think at this time it’s best for me to drop the “dwi-probate” part. A while back I was surfing here at blog spot and saw a utility to migrate a blog to a new URL.

It might take me a while, but now that I have this new blog set up at this location; my intent is to migrate my whole old blog to here – if I can figure out how to do it.

So come back later and see how I’m coming.

Good news and bad news for potential bankruptcy filers

Within the past month there has been good news and bad news for folks thinking of filing a bankruptcy. The good news is that the federal exemptions have gone up as of April 1, 2010. The bad news is that the median income thresholds – which have a lot to do with who qualifies to file a Chapter 7 – have gone down slightly as of March 15th.

I just finished updating my exemptions page and my Chapter 7 page by posting the new numbers if you want to check them out.

The theory of Chapter 7 is that the court appoints a trustee who is given ownership of all your assets, right down to your socks. To get the assets back, you have to be able to claim them as exempt. This means that the list of things you can claim as exempt is very important. Here in Minnesota we get to choose between two very different lists – a list provided by federal law and another list provided by state law. The two lists are quite different, so it can make a big difference which one you choose. In general, the federal list is better unless you have substantial equity in your home. If there’s quite a bit of equity, then you better use the state list.

Trouble is that except for the fact that it is good for protecting one’s home, the state list has lots of gaps. Lots of things fall through the cracks and will go to the trustee. For this reason I pretty much hate the state list, but sometimes I have to use it anyway.

Since October of 2005 anybody who wants to file a Chapter 7 – except for a person who’s debts are “primarily business” – has to either be under the median income or pass a difficult means test. Thus, what those median income numbers are also becomes very important.

I’m relaxed. Really RELAXED.

Or not.

Nothing drives me close to being stark raving mad like a computer problem. It seems as if when that happens, everything else has to stop until the problem is resolved; and really let me tell you, I definitely have other things to do.

Last week my trusty laptop, upon which I have relied several years for a great many things, started giving me the following message when I booted it up: “Disk failure imminent. Back up all data.”

Maybe it was that new defrag program I had tried. Or maybe the laptop is just old. It has served me well four years, maybe almost five. The techno geeks in my life, and I call them that with due respect, all tell me that this is about the useful life of most laptops.

So late last week I went to my friendly local office supply store. The previous Sunday in the Star Tribune I noticed they were having a laptop sale. Yes, from time to time I have been known to still read a newspaper that’s actually printed on paper. Anyhow, at the store I found a wonderful whiz bang HP laptop with a 17 inch screen, Windows 7 and all the trimmings.

I brought it home and went to work configuring it for my personal use. That means I installed Eudora for my email, Word Perfect for my word processing, and an old version of WS-FTP so I can update my web sites when I finally get around to it. There’s a lot of different stuff about Windows 7 that takes a while to figure out, but I really was doing OK.

I enjoyed that laptop for about all of 72 hours until yesterday afternoon, when it seems to have electrocuted itself. First it started turning itself off for no reason. I took that as a warning sign, plugged in my portable hard drive and managed to back up most of my stuff before it breathed it’s final breath. After shutting itself off abruptly several times, it finally refused to boot up at all.

So this morning I tried to return the dead laptop. Fried hard drive was the diagnosis. All they would let me do is trade it for another one. So now I’ve spent my whole morning trying to get another one up and running to my own personal specs. I’m trying to be gentle with it, but I want it the way I want it.

My apologies for not responding to my email for the past day or so. I hope to have that up and running again shortly.

The shoe is on the other foot today

I hate this. Amost more than anything.

I am about to leave the office for my annual trip to seem my accountant to do my taxes.

This means that I have to provide detailed financial info about myself to a third party. I try to be as accurate as possible, but I’m always concerned that I might not get it right.

I ask my clients for info like this all the time. Today I have a better idea of how that feels.

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