Chapter 13 Archives - Better Call Dave

April 14, 2023May 2, 2023

Big Bump in Median Incomes April 2023

By Dave Kelly, Minnesota Bankruptcy Attorney

Qualifying for a Straight Bankruptcy

The most common type of bankruptcy is Chapter 7. It also tends to be the most desirable form of bankruptcy. Often it is referred to as “straight bankruptcy.” It is the type of bankruptcy where usually you can get rid of all your unsecured debt in just a few months with minimal cost. There is typically no payment plan, just relief from your debt.

The best way to qualify for a Chapter 7 is to have annual income below the median for your household size in your state. If your income is a bit higher than that, you might still be able to qualify by passing a means test; but the means test is not all that easy. I would prefer to have your income below the median if we are going to do a Chapter 7. If it is much above the median, I would probably suggest a Chapter 13.

Meidan Income – A Moving Target

The US Trustee’s office has just announced the biggest increase in Minnesota median incomes for bankruptcy purposes that I can remember seeing. I calculate that the increases are around 8% for all the household sizes between one and four. Since these increases are supposedly based on a six month period, they seem to be thinking that median incomes in Minnesota have been increasing by 16% on an annual basis. I find that hard to believe, but I won’t complain.

Most years the median income numbers are adjusted on April 1st and again on November 1st. Sometimes they all go up, sometimes they all go down, sometimes the ups and downs are mixed, and sometimes they don’t change at all. Every state is different and is assigned their own set of numbers.

Latest Numbers for Minnesota

Here’s the exact Minnesota numbers as of the recent update copied from my Chapter 7 page:

One person: $ 71,643

Two people: $ 90,946

Three people: $ 114,267

Four people: $ 141,324

Add $9,900 for each individual in excess of4

For a household of one the increase is $5,309 per year. For a household of two it’s a $6,739 per year increase. It’s $8,467 for a household of three, and $$10, 472 for a household of four. If you thought you didn’t qualify for a Chapter 7 before, take another look. These numbers could make a big difference.

Call or text me at 952-544-6356. We can set up a time for a free telephone consultation to talk over the details of your case.

March 4, 2023March 4, 2023

Hearings Never Going Back to the Way They Were

By Dave Kelly, Minnesota Bankruptcy Lawyer

What Happens at the Meeting of Creditor Hearing

About a month after a personal bankruptcy is filed, whether it’s a Chapter 7 or a Chapter 13, there is a hearing they call the “First Meeting of Creditors.” Most of the time I just call it the “hearing”, although the official name is “First Meeting of Creditors.” I think “hearing” is a more accurate term because for one thing, in the vast majority of cases, the last thing you will ever see at one of these events is a creditor. The creditors are invited to appear, but they know it’s a waste of their time and almost never show up.

“Hearing” is also a good way to describe what happens. The process is presided over by either the bankruptcy Trustee or a lawyer on the staff of the bankruptcy Trustee. This Trustee is not a judge, but from my perspective he or she might was well be. Nobody has more power or influence over how the case goes than the Trustee. The person who filed the bankruptcy is put under oath and asked a series of questions. Depending on the answers, things can expand into even more questions. In a simple case it might only take ten minutes. But I have seen complicated cases where it has taken over an hour; and in those more complicated cases it can easily take more than one sitting.

Traditionally these hearings/Meetings of Creditors always took place at a federal courthouse or some other location like a federal courthouse, depending on the county in which the Debtor lived. I would put on my traditional lawyer outfit, including my lawyer shoes, and head for the designated location. I had it down to a science. I knew where I wanted to park and where I wanted to meet my clients before the hearing. It was usually kind of fun, because I would see my lawyer friends there. This was the norm. It was how things were done.

Covid Hit and Everything Changed

In early 2020 when Covid hit the whole process changed dramatically. The Trustees started conducting these hearings remotely by Zoom or some similar method. Everyone assumed this change was temporary and we’d be back to the courthouses when the virus passed. It never occurred to any of us that the change might become permanent. There may have been jokes about it becoming permanent, but nobody considered it a serious possibility – at first.

But I did start noticing that not going downtown saved time, and grief and parking money. People including the Trustees started to like doing it remotely, so did I. Many of my clients said they didn’t want to go downtown and expressed relief that we were not going to have to. My clients could stay home if they wanted to and do the hearing from there; but it has always been my preference to have them come to my office for the hearing. Even if we are not going down to a courthouse, I still think there is a tremendous benefit to being physically present in the same room with my clients when this hearing takes place. As I have always done, I like to meet early before the hearing with my clients and do preparation. I almost always know approximately what the Trustee will be asking. I want to go over the expected questions with my client and have my client as ready as possible.

When Are We Going Back to In-Person? Never!

Late last year as I usually do I attended the Bankruptcy Institute, a big series of classes and talks put on by Minnesota Continuing Legal Education. I was assuming that one of the things I would learn would be what the plans were for returning to in-person hearings for the Meetings of Creditors. In-person hearings were already taking place before the judges for the more complicated matters such as motions, adversary proceedings and reaffirmation agreements. Instead what I heard was that the switch to remote for the Meetings of Creditors was going to be made permanent. A nationwide protocol for doing it by Zoom on a permanent basis was going to be promulgated some time in 2023.

My Lawyer Shoes Continue to Gather Dust

Usually I manage to avoid those in-person hearings in front of the judges. Those tend to only be required if something has gone wrong with the case. If the case is put together well, we should be able to stay away from the judges. So these days I am only dressing like a lawyer from the waist up. It may be a long time if ever that I again have to wear the pants that come with my suit. The same goes for my lawyer wingtip shoes, which have been gathering dust in the corner of my bedroom. Maybe I’ll just have to wear the pants and the shoes some time for the heck of it.

Call Dave at 952-544-6356

July 18, 2022September 13, 2022

Welcome to My Youtube Channel

welcome to Dave's bankruptcy Youtube channel

By Dave Kelly, Minnesota Bankruptcy Attorney

Youtube recommends that every channel should have a welcome video. The video designated as the welcome video will be the first thing a person sees when they go to a particular channel. The video should be a short statement of what the channel is about and what information can be found there. My channel has videos going back to 2007; but until now there was no welcome video. I just uploaded it a few days ago, and here it is:

Information you can find on my Youtube channel includes but is not limited to the following:

• Going to jail for debt
• Bank accounts – which ones should be closed
• Questions to expect at the hearing
• Documents you will be required to produce
• What about rental properties in bankruptcy
• Property that is exempt
• What does bankruptcy cost
• Debt settlement programs
• 7 things to not do before bankruptcy
• 7 things you should consider doing before bankruptcy

You will also find a lot of information about how to qualify for bankruptcy and what kind of bankruptcy you might qualify for.

It looks like my videos are attracting quite a bit of traffic. Youtube is peppering my videos with all sorts of commercials over which I have no control and from which I don’t get a cent. In order to get paid anything at all from the advertising revenue, they require a lot more subscribers than I currently have. So please do me a favor. If you find my channel helpful at all, PLEASE SUBSCRIBE.

January 5, 2022September 13, 2022

Top 7 TO DO’s Before Bankruptcy: Item 7 – Avoid High Bank Balances if Expecting Garnishment

By David J. Kelly, Minnesota Bankruptcy Attorney

This is the final post in my series on the top seven things you should probably be doing if you are considering a Chapter 7 or a Chapter 13 bankruptcy. I don’t intend to help you with a do it yourself bankruptcy. My purpose is to introduce topics for you to discuss with your lawyer. Don’t try this by yourself.

Bank Accounts Can be Frozen Without Advance Notice

Let’s say you have been sued by a creditor. The judgment has been entered and now the creditor is looking for assets to seize. To garnish your wages the creditor has to give you a ten day notice – or at least is supposed to. But in Minnesota no advance notice is required before a garnishment of a checking or savings account. If the creditor garnishes your bank account, the first you may hear about it is when your bank or credit union notifies you that the account is frozen. Before you even get notified by your bank or credit union, you may notice that your checks are bouncing, your payments are not going through, and the pay check that was recently deposited is now beyond your reach.

You Must Claim All or Part of the Account as Exempt to Get Access to Your Account Again

More than likely all or a good part of the money in your account is exempt and cannot be taken by the creditor. After the account is frozen, you will be (or are supposed to be) given an Exemption Form that you can use to claim your exemptions. You might not receive this for a few days after the account is frozen. Then you have to fill it out and send it back to the creditor’s lawyer. Once the lawyer receives it, he or she is supposed to release to you that part of the money in the account which is exempt. Days can pass, even a couple of weeks, before this process is completed. Then you can use your account again, minus whatever amount the creditor took out of it. More accurately stated, you can use your account again until the next time the creditor garnishes it.

Avoiding or Minimizing the Freezing of Your Bank Account

Maybe this can’t be avoided, but the problem can be minimized. One thing you can do is what I suggested in Item 3 of this series: Move your money to a bank that will be harder to find. Creditor’s attorneys often send out a shotgun blast of garnishment notices to all the major banks. They don’t know where you bank, but chances are that if you are using one of the larger banks your account will get caught in the net. People have been surprised and asked me how the creditor knew where they banked. The answer is that the creditor didn’t know, they just got lucky. I love the little banks that nobody has heard of. Any bank whose name starts with “State Bank of ….” is probably a good bet.

Another thing you can do is just keep the bank balance as low as possible. The creditor can only freeze what is in the account. This might involve making cash withdrawals and cash deposits as needed to cover the things that must be paid out of the checking account. The back and forth movement of cash may look suspicious to a bankruptcy trustee. The trustees are always looking for evidence that money is being hidden. You and your lawyer might have to explain why this is being done. But once the trustee understands that this is merely an effort to avoid or minimize garnishment, it should be OK. We will have to be careful to accurately disclose the cash on hand in your bankruptcy forms. All assets have to be disclosed.

No One Size Fits All Solutions

This topic is something you are going to have to discuss with your lawyer. Cash can be harder to claim as exempt than money in the bank, at least in a state exemption case. If you are using the state exemptions and not the federal exemptions, having large amounts of cash might be a really bad idea. You might be setting yourself up to have the bankruptcy trustee take your money, which is just as bad as having it garnished. There are no one size fits all solutions. Don’t do any of what I discuss here without being advised by your attorney.

Call Dave at 952-544-6356.

June 2, 2018October 19, 2020

Bankruptcy & Social Security Overpayment

By David J. Kelly, Minnesota Bankruptcy Lawyer

I want to say a few words about whether a debt owing to the Social Security Administration for overpayment of benefits can be discharged in a bankruptcy. Often it can be.

If you have received Social Security you know that several factors, many of them beyond your control, can affect whether you are eligible and for how much. This is especially true of disability benefits. A change in status can end your eligibility or reduce the amount. It’s all very complicated and hard to understand – especially if you are ill.

The Social Security Administration is a big and cumbersome organization that makes lots of mistakes. Lots of times they pay benefits when they are not supposed to. Often this happens because they can be very slow in processing information they receive from beneficiaries. The impression I have is that most beneficiaries are very careful about complying with requirements that they report any change in their circumstances. If you report the change and the benefits keep coming, most people would assume that the change didn’t make a difference. Later, however, you may be shocked to receive a nasty letter from the Social Security Administration. The letter claims that you have been overpaid and demands repayment.

Suddenly you have a very large debt to a federal government agency. Nobody is more powerful. They might start withholding from the benefits you are still eligible for; they might seize your tax refunds; or they might even start garnishing your wages. Most people assume that like the usual student loans and taxes, there is no way to make this go away. This is what I assumed too the first time someone came to my office with one of these letters.

I was surprised to learn when I did a little research that many if not most of these Social Security overpayment claims can be discharged in bankruptcy. When a debt like this is listed in a bankruptcy, it is going to be discharged unless the Social Security Administration successfully objects. In order to figure out whether to expect an objection, it is helpful to check Social Security policies as published in their on line Program Operations Manual. The guidelines as to when such an objection should be filed are in GN 02215.196 of the manual. They will object if they believe they can prove that the overpayment was a result of fraud or misrepresentation.

They use a three part test to define what they mean by misrepresentation. There must have been 1) an overpayment caused by false representation, 2) made with the intent to deceive and 3) upon which the Social Security Administration relied to it’s detriment.

The typical person I see in my office who with one of these overpayment letters isn’t anywhere close to satisfying the above test. This person hasn’t told any lies and certainly wan’t trying to deceive anybody. There was no intent to cheat the government out of anything. It was more a matter of just stumbling into the situation. If this is where you find yourself, you might want to give me a call. The chances that a bankruptcy can make the whole problem just go away are very good.

May 3, 2018July 15, 2022

Minnesota State Exemptions Still Leaking Assets Like a Sieve

By David J. Kelly, Minnesota Bankruptcy Attorney

When you file a Chapter 7 bankruptcy, ownership of all your assets all the way down to your socks passes to a trustee appointed by the court. The only way to avoid losing your shirt and most everything else you own is to claim the assets as exempt. If you qualify to use the federal exemptions, it is very likely that everything you own will be exempt and you will keep all your assets. That’s the result I always want to see – my client gets rid of his or her debts but keeps all his or her stuff.

The only problem with the federal exemption list is that it has a low number for the amount of homestead equity which can be exempted. If someone has more equity than can be protected by the federal exemptions, the only other choice is to use the state exemptions. The Minnesota state exemptions will protect up to $$390,000 of equity in a homestead, but other than that those exemptions leave a lot to be desired. They are hopelessly out of date in many respects.

For example, the only electronics clearly allowed as being exempt are a radio, a phonograph and television receivers. Notoriously, computers are not exempt. Neither are cell phones, tablets, game machines, printers, monitors or any other device that isn’t a TV, radio or phonograph.

There’s no exemption for jewelry, unless it’s a wedding ring that was actually present at the wedding ceremony. There’s no exemption for guns, sporting goods such as bicycles or exercise equipment, or collectibles of any kind. Household furnishings, clothing and appliances are exempt, but a riding lawn mower is not considered to be an appliance. Money in your checking account or savings account is not exempt unless it can be traced to a pay check from employment which was deposited within the last 20 days. There’s no exemption for any kind of a tax refund which may be owing or which may have accumulated as of the date of filing the bankruptcy. Bankruptcy trustees routinely present my clients with a form which signs over their tax refunds.

Several weeks ago two bills were introduced at the state legislature in St. Paul to try and correct some of this. One of them added exemptions for the following, all of which currently are absent from the exemption list:

Computers, tablets, printers and cell phones as part of the household goods exemption
Jewelry up to a value of $2,817.50 – replacing the existing wedding ring exemption
A new section exempting $3,000 of tools, snow removal equipment and lawnmowers
A wild card exemption which could be used for up to a $1,250 value of property not fitting into any other exemption; and
Health savings accounts (HSA) and medial savings accounts up to a value of $6,500.

When I heard last week that the legislature had passed an amendment to the exemption statute, I got quite excited. I thought it must be the bill I just described above. I was quite disappointed to learn that it was another bill which only added one provision: an exemption for health savings accounts and medical savings accounts up to a value of $25,000. It’s nice that the amount of the exemption is so high, but I almost never see anyone with an HSA which has any more than a few hundred dollars in it.

So except for the new exemption for the HSAs, we are still stuck with all the same old problems with the Minnesota state exemptions. Oh well, at least the antique radio in my office is exempt.

January 8, 2018October 19, 2020

Hard to Pay Those Troubling Holiday Shopping Bills?

By David J. Kelly, Minnesota Bankruptcy Attorney

Around this past Thanksgiving CNBC published a report about how an alarming number of shoppers are still paying off debt from Christmas of 2016. A lot of the data in the report came from a source called NerdWallet. It seems that holiday-induced spending and debt is a growing problem. 24% admitted to overspending for the holidays of 2016. Among baby boomers, 64% went in debt to pay for Christmas. For Gen-X it was 58% and for millennials it was 40%.

When it comes to not yet having paid off the 2016 debt, the millennials led with 24%. Gen-X came in at 16% and the boomers were at 8%.

The advice offered by CNBC to help avoid going into debt over the holidays again is threefold:

Make a good budget and stick to it.
Keep an eye out for sales; and
Pay debt back.

My reaction to this advice is to say to myself “well that’s easy for them to say.” Credit card debt has a way of sneaking up on a person. Not everyone is capable of paying their debt back. Many are overwhelmed and the bills that come in after Christmas can be the straw that breaks the camel’s back.

If you are looking at your holiday bills and other debts in shock, perhaps it is time to consider another alternative. Once unsecured debt totals more than half of your annual income, it is usually impossible to get it paid back. For you a Chapter 7 or Chapter 13 bankruptcy might be a good idea.

May 20, 2017May 20, 2017

US Households Owe Record Amount – More Than During Recession

The New York Times and the Associated Press have been reporting new statistics just released by the “New York Fed.” I’m sorry, but I talk Minnesotan and “New York Fed” is not something in my vocabulary. So I looked that up and find that it’s the Federal Reserve Bank of New York. If you can’t believe them, then who can you believe.

The New York Fed says that consumer debt in the US now exceeds the level it was at before the recession. I will admit that I’ve been wondering a bit, because over the past couple months my phone has been ringing a lot more than it did in 2015 and 2016. I think the ringing of my phone might be a better barometer of what’s going on than the financial reports in the media. I remember in 2008 when it started ringing like never before, they were still saying on the financial news networks that there was no sign of a recession. The media in general wants to downplay economic problems. So I figure if they are actually reporting a story like this, things are probably worse than they are admitting.

The New York Fed goes on to say, however, not to worry. The new debt is proportionately more auto loans and student loans than it was in 2008, and besides the people with the debt are more credit worthy now. In addition, home ownership is down and a higher percentage of mortgage debt is held by people over 65, as if that somehow was good news. They admit that the student loan debt is getting up there and could be a bit high. Also it might be that defaults on those auto loans are on the rise. But a lot of the language in these stories is very soothing, so not to worry.

My opinion, based more on what I see with my own eyes, is this. I think it is time to worry. People may be back to work, but their earnings are down. They still need to drive and the old car can only go so far, so they are getting car loans that they can’t really afford. If they are not back to work they are back to school, getting student loans that they can’t afford. Getting credit might be a bit more work than it used to be, but with the help of Credit Karma and other similar sites the lenders can still be manipulated into granting credit to people who really can’t afford it. Maybe on paper they look more credit worthy, but that could be as much a fiction now as it was in 2008. In other words, I believe individuals in this country are getting overextended again. For many, another bubble may be about to burst.

This post is for general information purposes only, is not legal advice and does not create and attorney-client relationship.

March 18, 2017September 21, 2020

Nothing is More Expensive Than A Cheap Bankruptcy Lawyer

By David J. Kelly, Minnesota Bankruptcy Lawyer since 1976

Recently I had a bankruptcy case where a seemingly small and innocent circumstance turned up after the case was filed. It seemed normal to my client at the time and certainly not dishonest in any way. It wasn’t illegal, immoral or fattening. It just happened, however, to be one of those things which can run afoul of some of the more nonsensical provisions of the bankruptcy code.

I could have just said well that’s too bad and let things land wherever. Fixing the situation was probably beyond the scope of what I had signed on for in my retainer agreement. Many of the larger law firms, particularly the mills that crank out large volumes of cases for cheap, would have just let it go. Lawyers don’t promise that everything will be perfect; we don’t promise that nothing will go wrong. Sometimes it’s just too bad, isn’t it?

But that kind of approach is just not how I do things. I really care about the outcome of my work and I really care about my clients. I just could not let it go. It would, and actually did, keep me awake at night. I started asking my client more questions, started asking for more documentation, more history. I explained that there was a problem, but I was aware of two or three exceptions, loopholes if you like, and I was determined to find one that fit.

I found what I was looking for and put it together for presentation to the bankruptcy trustee. When I was finished, the trustee agreed with me that the issue was settled in my client’s favor and the case should proceed in the usual boring way.

On a forum at AVVO.com, Las Vegas bankruptcy attorney Dorothy Bunce said it best in answer to a question about how to find a cheap bankruptcy lawyer:

“If you have $70,000 in debt, why do you care ‘how much does it cost?’ Talk about being penny wise and pound foolish. Whatever the bankruptcy attorney charges, if the attorney takes care of you and eliminates as many of your debts as legally possible, protects your assets, and answers your questions, price is immaterial. When “how much” is someone’s first question to me, I get rid of them as soon as I can because they are telling me they don’t value what I do and will have to learn the hard way that NOTHING IS MORE EXPENSIVE THAN A CHEAP LAWYER.” Quoted with Ms. Bunce’s permission.

That sure as heck says it all.

This response is for general purposes only, is not legal advice and does not create an attorney-client relationship. I am a debt relief agency. I help people file for relief under the federal bankruptcy code.

February 4, 2017February 4, 2017

The Minnesota Bankruptcy Responsibility Forms

In fall of 2010 the bankruptcy judges in the Minnesota were getting upset. Their phones were ringing with calls from people who had questions that should have been answered by their lawyers; but these people were complaining that their lawyers would not return the calls.

At about the same time the judges started hearing complaints from the trustees about lawyers not showing up for the hearings (meeting of creditors). It didn’t take long for them to figure out that there were a large number of new lawyers on the scene who didn’t know what they were doing. Just out of law school, they were trying to pay their student loans by jumping into what was at that time a booming bankruptcy market. Worse than that, however, many of these lawyers had been hired by fly by night petition preparation mills who were asking them to just sign off on bankruptcy petitions which had been prepared in India or who knows where. So although there was a lawyer’s name on the bankruptcy case, it had actually been prepared by an automated service. This resulted in many cases being filed on behalf of clients who had never actually talked with or met the person who supposedly was their lawyer.

Lots of things were going wrong with these cases. This made it harder for everyone in the system. In an effort to remedy the situation, our judges created and began to require the use of the following “responsibility forms.” Although I was embarrassed for my profession – that it had come to this – when they first came out, I can now see that they have some value. I reproduce them here. Please note that the form for Chapter 7 is slightly different than the one for Chapter 13. Now that it’s been over six years since all that happened, it may be old news; but both the lawyer and the client are still required to sign these forms at the time a case is filed.

By the way, usually when I discuss these forms with my clients, I refer to them as “the dummy checklist.” If it weren’t for some real dummies, we would not need them.

NOTICE OF RESPONSIBILITIES OF
CHAPTER 7 DEBTORS AND THEIR ATTORNEYS
This Notice lists certain responsibilities of debtors and their attorneys. Nothing in this document changes, limits, or in any way alters the debtor’s or the debtor’s attorney’s obligations under the Bankruptcy Code, the local and national rules, or any rule of professional responsibility.

UNLESS THE COURT ORDERS OTHERWISE:

I. Before the case is filed, the attorney for the chapter 7 debtor shall, at a minimum:

A. Meet with the debtor to review and analyze the debtor’s real and personal property, debts, income, and expenses and advise the debtor on whether to file a bankruptcy petition;

B. Explain the various bankruptcy and non-bankruptcy options, the consequences of filing under chapters 7, 11 or 13 and answer the debtor’s questions;

C. Explain to the debtor how the attorney’s fees are paid;

D. Advise the debtor of the requirement to provide to the trustee the most recently filed tax return(s) at least seven days prior to the scheduled meeting of creditors. In addition, advise the debtor of the requirement to attend the meeting of creditors and identify the documents the debtor must bring to the meeting;

E. Advise the debtor that providing false information in the bankruptcy schedules or false testimony at the meeting of creditors or other hearing or trial may expose the debtor to criminal prosecution and denial of discharge;

F. Advise the debtor of the necessity of maintaining liability, collision, and comprehensive insurance on vehicles securing loans or leases;

G. Timely prepare and file the debtor’s petition, plan, schedules, statements, certificates, and other documents required to commence a case, and review them for accuracy contemporaneously with the filing.

II. After the case is filed, the attorney for the chapter 7 debtor shall, at a minimum:

A. Ensure that the debtor is adequately represented by an attorney at the meeting of creditors;

B. Prepare, file, and serve any necessary amendments to the petition, schedules, and statements;

C. Promptly respond to the debtor’s questions throughout the case;

D. Consider and advise the debtor concerning the debtor’s options to buy, sell or refinance real or personal property and assume or reject executory contracts or unexpired leases;

E. Prepare and file a proof of claim for a creditor when appropriate to protect the debtor’s interest;

F. Fully advise the debtor of the legal effect and consequences of proposed reaffirmation agreements and any defaults thereunder and, where appropriate, negotiate alternate terms with secured creditors, ensure that any agreement is fully and properly completed and filed and appear at any hearing, if required;

G. Advise the debtor in motions for relief from the automatic stay, file objections when appropriate, and appear, when required, at any hearing;

H. Prepare, file, and serve responses to motions for dismissal of the case;

I. Advise the debtor of the requirement to complete an instructional course in personal financial management and the consequences of not doing so;

J. Represent the debtor in connection with any audit request; and

K. Represent the debtor in bringing and defending any and all other matters or proceedings in the bankruptcy case as necessary for the proper administration of the case.

III. The attorney shall comply with Local Rule 9010-3 and represent the debtor in bringing and defending all matters in the bankruptcy case until a substitution of attorneys is filed or an order is entered allowing the attorney to withdraw.

Unless otherwise agreed, the attorney has no responsibility to represent the debtor in adversary proceedings. However, if an adversary proceeding is filed against the debtor, the attorney will explain to the debtor the estimated cost of providing representation in the adversary proceeding, the risks and consequences of an adverse judgment, and the risks and consequences of proceeding without counsel, as well as the sources, if any, of possible pro bono representation.

IV. Before the case is filed, the chapter 7 debtor shall:

A. Fully disclose, review and analyze with the attorney the debtor’s real and personal property, all debts, income, expenses and all other financial information needed to properly complete the schedules and statements;

B. Prior to and throughout the case respond promptly to all communications from the attorney;

C. Prior to and throughout the case, timely provide the attorney with full and accurate financial and other information and documentation the attorney requests, INCLUDING BUT NOT LIMITED TO:

1. A Certificate of Credit Counseling and any debt repayment plan;

2. Proof of income received from all sources in the six-month period preceding filing, including pay stubs, social security statements, workers’ compensation payments, income from rental property, pensions, disability payments, child and spousal support, and income from self-employment;

3. The most recently filed federal and state income tax returns, or transcripts of returns, as well as any other returns requested by the attorney, the trustee, the court, or a party in interest;

4. A government-issued photo identification and proof of social security number, such as a social security card or W-2;

5. A record of interest, if any, in an educational individual retirement account or a qualified state tuition program;

6. The name, address, and telephone number of any person or state agency to whom the debtor owes back child or spousal support or makes current child or spousal support payments, and any and all supporting court orders, declarations of voluntary support payments, separation agreements, divorce decrees, or property settlement agreements;

7. Any insurance policies requested by the attorney;

8. Vehicle titles for all cars, trucks, motorcycles, boats, ATVs, and other vehicles titled in the debtor’s name;

9. Legal descriptions for all real property, wherever located, owned by the debtor or titled in the debtor’s name, or in which the debtor has any interest whatsoever, including but not limited to, a timeshare, remainder interest, or life estate;

10. Documents relating to any inheritance to which the debtor is entitled or may be entitled;

11. Information relating to any foreclosures, repossessions, seizures, wage garnishments, liens, or levies on assets which occurred in the preceding 12 months or continues after the filing of the case;

12. Information and documents relating to any prior bankruptcies filed by the debtor(s) or any related entity;

13. Any changes in income or financial condition, such as job loss, illness, injury, inheritance, or lottery winnings before or during the case;

14. Information and documents relating to any lawsuits in which the debtor is involved before or during the case or claims the debtor has or may have against third parties;

15. Information relating to any seizure of tax refunds by the IRS or Department of Revenue;

16. All information or documentation needed to respond to any motion or objection in the bankruptcy case;

17. Any tax returns, account statements, pay stubs, or other documentation necessary to timely comply with requests made by the United States Trustee or the Chapter 7 Trustee or any audit requests.

D. Cooperate with the attorney in preparing, reviewing, and signing the petition, schedules, statements, and all other documents required for filing a bankruptcy case.

V. After the case is filed, the chapter 7 debtor shall:

A. Timely and promptly comply with all applicable bankruptcy rules and procedures;

B. Appear punctually at the meeting of creditors with recent proof of income, a government-issued photo identification card, proof of social security number, and copies of all financial account statements covering the date the bankruptcy petition was filed;

C. Contact the attorney before buying, refinancing, or contracting to sell real property and before entering into any loan agreement until the debtor receives a discharge;

D. Keep the court, the trustee, and the attorney informed of the debtor’s current address and telephone number; and

E. Complete an approved debtor education course and provide the certificate of attendance to the attorney for filing.

VI. The chapter 7 debtor’s attorney shall, both before and after the case is filed, comply with all applicable professional and ethical rules and shall exercise civility in dealings with all entities with which the attorney comes in contact. The attorney shall also advise the chapter 7 debtor to likewise act in a civil and courteous manner, to dress in a manner appropriate for a federal proceeding and debtors shall do so.

Signatures. By signing this acknowledgment, the debtor and the attorney certify they have read it and understand what is required of the debtor and the attorney in this bankruptcy case.

A fully executed copy of this document must be filed with the petition commencing the bankruptcy case of the debtor(s).

NOTICE OF RESPONSIBILITIES OF
CHAPTER 13 DEBTORS AND THEIR ATTORNEYS

This Notice lists certain responsibilities of debtors and their attorneys. Nothing in this document changes, limits, or in any way alters the debtor’s or the debtor’s attorney’s obligations under the Bankruptcy Code, the local and national rules, or any rule of professional responsibility.

UNLESS THE COURT ORDERS OTHERWISE:

I. Before the case is filed, the attorney for the chapter 13 debtor shall, at a minimum:

A. Meet with the debtor to review and analyze the debtor’s real and personal property, debts, income, and expenses and advise the debtor on whether to file a bankruptcy petition;

B. Explain the various bankruptcy and non-bankruptcy options, the consequences of filing under chapters 7, 11 or 13 and answer the debtor’s questions;

C. Explain to the debtor how the attorney’s and trustee’s fees are paid;

D. Explain what payments will be made directly by the debtor and what payments will be made through the debtor’s chapter 13 plan, with particular attention to mortgage and vehicle loan payments, as well as any other claims with accrued interest;

E. Explain to the debtor how, when, and where to make the chapter 13 plan payments;

F. Explain to the debtor that the first plan payment must be made to the trustee within 30 days of filing the case;
G. Advise the debtor of the requirement to provide to the trustee the most recently filed tax return(s) at least seven days prior to the scheduled meeting of creditors. In addition, advise the debtor of the requirement to attend the meeting of creditors and identify the documents the debtor must bring to the meeting;

H. Advise the debtor that providing false information in the bankruptcy schedules or false testimony at the meeting of creditors or other hearing or trial may expose the debtor to criminal prosecution and denial of discharge;

I. Advise the debtor of the necessity of maintaining liability, collision, and comprehensive insurance on vehicles securing loans or leases;

J. Timely prepare and file the debtor’s petition, plan, schedules, statements, certificates, and other documents required to commence a case, and review them for accuracy contemporaneously with the filing.

II. After the case is filed, the attorney for the chapter 13 debtor shall, at a minimum:

A. Ensure that the debtor is adequately represented by an attorney at the meeting of creditors and make every effort to obtain confirmation of the plan;

B. Prepare, file, and serve any necessary amendments to the petition, schedules, and statements;

C. Respond to any objection to plan confirmation and, where necessary, prepare, file, and serve a modified plan, and appear, as required, at any hearing;

D. Prepare, file, and serve post-confirmation documents necessary to modify the plan;*

E. Promptly respond to the debtor’s questions throughout the case;

F. Prepare, file, and serve necessary motions to buy, sell, or refinance real or personal property;*

G. Prepare and file a proof of claim for a creditor when appropriate to protect the debtor’s interest;

H. Object to improper or invalid claims when appropriate to protect the debtor’s interest;*

I. Advise the debtor in motions for relief from the automatic stay, file objections when appropriate, and appear, when required, at any hearing;*

J. Consider and advise the debtor concerning lien avoidance and, if appropriate, prepare, file, and serve necessary motions to avoid liens on real or personal property;

K. Prepare, file, and serve responses to motions for dismissal of the case;*

L. Advise the debtor of the requirement to complete an instructional course in personal financial management and the consequences of not doing so;

M. Prepare, file, and serve the Chapter 13 Debtor’s Certifications Regarding Domestic Support Obligations and Section 522(q) and the Certificate of Debtor Education immediately after completion of plan payments;

N. Represent the debtor in connection with any audit request;* and

O. Represent the debtor in bringing and defending any and all other matters or proceedings in the bankruptcy case as necessary for the proper administration of the case.

IV. Before the case is filed, the chapter 13 debtor shall:

B. Prior to and throughout the case respond promptly to all communications from the attorney:

C. Prior to and throughout the case, timely provide the attorney with full and accurate financial and other information and documentation the attorney requests, INCLUDING BUT NOT LIMITED TO:

1. A Certificate of Credit Counseling and any debt repayment plan;

3. The most recently filed federal and state income tax returns, or transcripts of returns, as well as any other returns requested by the attorney, the trustee, the court, or a party in interest;

4. A government-issued photo identification and proof of social security number, such as a social security card or W-2;

5. A record of interest, if any, in an educational individual retirement account or a qualified state tuition program;

7. Any insurance policies requested by the attorney;

8. Vehicle titles for all cars, trucks, motorcycles, boats, ATVs, and other vehicles titled in the debtor’s name;

10. Documents relating to any inheritance to which the debtor is entitled or may be entitled;

12. Information and documents relating to any prior bankruptcies filed by the debtor(s) or any related entity;

13. Any changes in income or financial condition, such as job loss, illness, injury, inheritance, or lottery winnings before or during the case;

14. Information and documents relating to any lawsuits in which the debtor is involved before or during the case or claims the debtor has or may have against third parties;

15. Information relating to any seizure of tax refunds by the IRS or Department of Revenue;

16. All information or documentation needed to respond to any motion or objection in the bankruptcy case;

17. Any tax returns, account statements, pay stubs, or other documentation necessary to timely comply with requests made by the United States Trustee or the Chapter 13 Trustee or any audit requests.

D. Cooperate with the attorney in preparing, reviewing, and signing the petition, schedules, statements, and all other documents required for filing a bankruptcy case.

V. After the case is filed, the chapter 13 debtor shall:

A. Timely and promptly comply with all applicable bankruptcy rules and procedures and with the terms of the chapter 13 plan;

C. Make all required payments to the Chapter 13 Trustee, and to such creditors as are being paid directly, and inform the attorney if required payments cannot be made;

D. Contact the attorney before buying, refinancing, or contracting to sell real property and before entering into any loan agreement;

E. Keep the court, the trustee, and the attorney informed of the debtor’s current address and telephone number;

F. Complete an approved debtor education course and provide the certificate of attendance to the attorney for filing;

G. Pay all required domestic support obligations;

H. Cooperate with the attorney to complete and sign the Chapter 13 Debtor’s Certifications Regarding Domestic Support Obligations and Section 522(q) immediately after making the final plan payment.

VI. The chapter 13 debtor’s attorney shall, both before and after the case is filed, comply with all applicable professional and ethical rules and shall exercise civility in dealings with all entities with which the attorney comes in contact. The attorney shall also advise the chapter 13 debtor to likewise act in a civil and courteous manner, to dress in a manner appropriate for a federal proceeding and debtors shall do so.

Signatures. By signing this acknowledgment, the debtor and the attorney certify they have read it and understand what is required of the debtor and the attorney in this bankruptcy case.A fully executed copy of this document must be filed with the petition commencing the bankruptcy case of the debtor(s).

* Local Rule 2016-1(d)(2) provides that an attorney who performs these services after confirmation of the plan may request additional attorney’s fees and expenses in connection with such services.