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Craig D. Robins, Esq. New York Bankruptcy Attorney, Longisland bankruptcy attorney

“ Craig D. Robins, Esq., has been a practicing Long Island bankruptcy attorney for over twenty-four years ”

Craig D. Robins, Esq.

Archive for April, 2009

Scott Y. Stuart Writes Opinion Piece for Dow Jones Daily Bankruptcy Review

Posted on Wednesday (April 29, 2009) at 1:00 pm to Chapter 11 Bankruptcy

There may be greater scrutiny with attorney's fees in a big three auto make Chapter 11 bankruptcy caseWritten by Craig D. Robins, Esq.
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The Future of Attorney’s Fees in a Big-Three Auto Maker Chapter 11 Bankruptcy Case
 
My friend and colleague, Scott Y.Stuart, Esq., a former Long Island bankruptcy attorney, wrote an opinion piece that appeared in today’s Dow Jones Daily Bankruptcy Review, entitled, “Big Brother And The Big Three: How Will Professionals Fare?”
 
With possible bankruptcies by each of the big three auto makers distinct possibilities, the news has been rife with articles about every aspect of a possible bankruptcy filing.
 
In Scott’s article, he poses the question: “In the unchartered waters of direct government intervention into the Chapter 11 process, where do professionals stand?”
 
Scott points out that the government will likely be a central player in any auto maker bankruptcy.  He suggests that debtor-in-possession financing in such a case would likely be funded with taxpayer dollars.  Thus, any case professionals, such as the bankruptcy attorneys, will in effect be getting their fees from this same pool of funds.
 
Scott ponders whether the bankruptcy attorneys will be under additional scrutiny and transparency since the government, in effect, would then be paying their fees.
 
He concludes that in the context of a Big Three Chapter 11 filing, since the continued operations of the company will likely be largely funded through public money, the dynamics of how bankruptcy attorney’s fees will be viewed and evaluated may radically change.
 
Scott Y. Stuart, former Long Island Bankruptcy AttorneyScott is the former Senior Trial Attorney in the Office of the United States Trustee here on Long Island.  He and I had a number of matters together in the 1990’s when I represented various debtors in Chapter 11 proceedings and he represented the U.S. Trustee.  We also served on some panels together, explaining bankruptcy law to fellow attorneys and judges.  He then went on to become department chair of Rivkin Radler’s insolvency department.  Now he is a partner with Donlin Recano & Company, Inc., a prominent claims, noticing, balloting and distribution agent for complex Chapter 11 reorganization cases.
 
I was able to read the article because I currently have a trial subscription to Dow Jones Daily Bankruptcy Review, which I couldn’t justify subscribing to ordinarily, as the annual subscription rate is $4,800.  They have a special three-year promotional subscription rate of $13,100 that will save you a few thousand bucks.
 
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Mortgage Fraud Legislation Is Passed by Senate

Posted on Wednesday (April 29, 2009) at 6:00 am to Mortgages & Sub-Prime Mortgage Meltdown

Mortgage Fraud Legislation Is Passed by SenateWritten by Craig D. Robins, pilule Esq.

Yesterday the Senate passed legislation by a vote of 92-4 to give the government more power to prosecute mortgage and financial fraud and create a commission to investigate the causes of the economic crisis.
 
The bill, S. 386, would make it easier to prosecute fraud in trading commodities futures, including options and debt derivatives.
 
Yesterday I wrote that the CEO of Long Island-based American Home Mortgage, Michael Strauss, agreed to settle SEC fraud charges and pay a fine of two and a half million dollars (Ex-CEO Of American Home Mortgage Settles SEC Fraud Charges ).
 
The federal anti-fraud law would be extended to cover private mortgage brokers, which generate almost half of this country’s home mortgages.
 
The measure would add 160 FBI agents, 200 prosecutors and Justice Department lawyers and 200 agents at the Secret Service, Postal Inspection Service and Department of Housing and Urban Development. The SEC would also receive funds to set up a nationwide database to track tips and trading patterns that might help detect fraud.
 
The proposed law will now be sent to the House of Representatives.
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Ex-CEO Of American Home Mortgage Settles SEC Fraud Charges

Posted on Tuesday (April 28, 2009) at 11:45 pm to Current Events
Mortgages & Sub-Prime Mortgage Meltdown

SECWritten by Craig D. Robins, Esq.
 
The SEC said that American Home Mortgage executives knew the company was collapsing like a house of cards and kept that secret
 
In a post from 2007, I discussed the sub-prime mortgage crisis and the toppling of the sub-prime mortgage industry.
 
In that post, I wrote that American Home Loan, one of the nation’s largest mortgage lenders at that time, which was then headquartered here in Melville, had utterly collapsed. (http://longislandbankruptcyblog.com/the-sub-prime-mortgage-meltdown/)
 
Today, the Securities and Exchange Commission announced that Michael Strauss, the former chief executive of American Home Mortgage Investment Corp., agreed to pay more than $2.45 million to settle fraud charges.
 
The SEC alleged that Strauss, as well as former CFO Stephen Hozie, engaged in accounting fraud and made false and misleading disclosures to conceal the mortgage lender’s worsening financial condition in early 2007 as the sub-prime crisis emerged.
 
“These senior executives did not just occupy a front-row seat to the mortgage meltdown – they were part of the show,” said Robert Khuzami, director of the SEC’s division of enforcement in a press release issued by the SEC. “As the housing market imploded, these executives kept secret that the company’s holdings were collapsing like a house of cards.”
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Bankruptcy Cramdown Provision Not Likely to be Passed This Week

Posted on Tuesday (April 28, 2009) at 6:52 pm to Bankruptcy Legislation

Bankruptcy cram-down provision not likely to be passed this week.  Long Island homeowners will have to wait to strip-down mortgages in Chapter 13 bankruptcy casesWritten by Craig D. Robins, cialis Esq.
 
Long Island homeowners with under-secured mortgages will have to wait longer to strip down mortgages in Chapter 13 bankruptcy cases.
 
I have been regularly posting about the legislative efforts to enact a Chapter 13 cramdown bill that would enable consumers to modify mortgage terms in Chapter 13 bankruptcy cases (Will the Senate Approve Cram-Down Legislation to Enable Mortgage Modification in Chapter 13 Bankruptcy Cases?).
 
Yesterday, medicine Sen. Richard Durbin, (D-Illinois), said that the cramdown provision would be stripped out of a wider housing bill that will come to the floor of the Senate later this week.
 
The cramdown provision, also known as a mortgage strip-down, will instead be offered as an amendment to the bill. However, with Republicans remaining united in opposition to it, and some moderate Democrats indicating they may vote against it, it is likely to be defeated.
 
This is most unfortunate.  Senator Durbin, the number-two ranking Senate Democrat, first introduced cramdown legislation two years ago. He has been unable to convince the mortgage industry to support the measure, and lend their significant lobbying weight behind his efforts.
 
The Chapter 13 bankruptcy cramdown provision has been a major priority of congressional Democrats as well as the Obama administration in its drive to tackle the housing crisis.
 
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Bankruptcy is Vital to Our Capitalistic Society

Posted on Monday (April 27, 2009) at 8:15 pm to Bankruptcy and Society
Benefits of Bankruptcy
Chapter 11 Bankruptcy

Bankruptcy is vital to capitalismWritten by Craig D. Robins, Esq
 
When a major corporation seeks bankruptcy protection, it helps our economy’s future
 
When I want to wax poetic, I tell my Long Island Chapter 11 business clients that bankruptcy is the lubrication that greases the gears of capitalism and enables our country’s businesses to grow for the benefit of society as a whole.
 
This is because bankruptcy enables entrepreneurs to take greater risks, knowing that if their business is not successful, our bankruptcy system may provide the necessary steam escape valve.
 
Coming to terms with a possible large auto company Chapter 11 bankruptcy
 
With the possible bankruptcies of General Motors and Chrysler very much in the news, a recent Wall Street Journal article provided some interesting commentary about large-scale corporate bankruptcy.  It said that America is relearning an old economic lesson – – that business failures and bankruptcy are essential to capitalism.
 
Bankruptcy is an orderly way to give a financially overburdened debtor the opportunity for a fresh new start by deciding which creditors get paid back and which do not.
 
In good economic times, bankruptcy encourages risk-taking. After all, if everyone feared taking a calculated risk on a venture that might fail, there would be a very stagnant economy.
 
Today’s large corporate bankrutpcies are not unlike the railroad failures over a hundred years ago
 
The Journal article compared the problems faced by the 21st century big auto makers with those of the 19th century railroads.  The roots of modern American business bankruptcy date to the bad times then, which may not be so unlike the bad economic times of today.
 
At the end of the 19th century, nearly 20 percent of the railroad track belonged to insolvent railroads.  With state governments unable to deal with railroads that stretched beyond their borders, and Congress hamstrung by a narrow interpretation of the Constitution, creditors turned to courts.  Judges fashioned an approach to divvy up assets among creditors that was codified in an 1898 law, the spirit of which survives today in our Bankruptcy Code.
 
Large bankruptcies may Help the Economy in the Longrun
 
Now we have General Motors and Chrysler. They cannot pay their debts; the only issue now is how, not whether, their creditors take a hit. 
 
President Obama has expressed his preference that there be, in essence, a bailout.  However, it is quite likely that a political solution may not work, and that there will be a major bankruptcy ahead.  But, although taxpayers fear bankruptcy, it’s an essential part of a functioning capitalist economy.   A major corporate bankruptcy may be the only way to prevent a corporation’s mistakes and past debts from hobbling the economy’s future.
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Long Island Bankruptcy Lawyers Have Been Very Busy

Posted on Thursday (April 23, 2009) at 12:00 pm to Bankruptcy and Society
Bankruptcy Practice
Benefits of Bankruptcy
Current Events
Long Island Economy

 Written by Craig D. Robins, Esq. 

The recession is driving so many Long Island consumers to seek bankruptcy relief that Long Island bankruptcy attorneys are working long hours

My staff and I have been working hard these past few months helping an increasing number of Long Island consumers file for bankruptcy relief

 

  

 

 

 

 

I’ve reported several times recently that bankruptcy filings have zoomed up over the past year.

(See my post from last month:  Rate of National Bankruptcy Filings Now Over One Million a Year   and my post:  Bankruptcy Filings Surged in 2008  ).

Consequently, my Long Island bankruptcy attorney colleagues and I have been quite busy helping Long Island consumers who need to eliminate debts and stop foreclosure.

 For me, that has meant finishing up client appointments as late as 11:00 p.m. on some nights, skipping many a dinner, and spending less time with family. However, during these difficult economic times, many clients need urgent help.

 My two full-time associate attorneys, Jason Leibowitz, Esq. and Dean Weber, Esq., have also been burning the midnight oil with me on many an occasion and I am grateful for their contributions to my firm and their dedication to helping our clients file for bankruptcy on Long Island.

My Personal Observations about Bankruptcy Cases on Long Island So Far this Year

From the types of bankruptcy cases we have been getting this year, I have observed that although job loss has affected some Long Island consumers, I have not yet seen a big bump in bankruptcy filings that are strictly the result of massive layoffs.

Instead, we are filing bankruptcy petitions for a steady but greatly increasing influx of typical Long Island consumers who are suffering from overwhelming credit card bills that are the result of some financial calamity – a failed business, loss of work as the result of illness, massive medical bills, unemployment, inability to work overtime, or divorce and separation.

There is no doubt that many of these clients have debt problems that are the result of the current recession.

However, in the coming months I anticipate seeing the impact of layoffs in the greater New York metropolitan area which will likely have a trickle-down effect on Long Island in which event there will be even more Nassau County bankruptcy filings and Suffolk County bankruptcy filings.  Last month I wrote about how the recession is affecting everyone on Long Island (Long Island Economist Provides More Grave Commentary About the Long Island Economy ).

In addition, there are a much greater number of Chapter 13 filings from Long Island homeowners who are seeking to save their homes from foreclosure. This is directly attributable to the great number of sub-prime mortgages that were issued between two and four years ago.

Typical Bankruptcy Debt Levels Have Increased Substantially

Another observation is that the average amount of family debt is now much greater than ever before. Where many families would have filed for Chapter 7 bankruptcy a few years ago with $20,000 to 40,000 in typical credit card debt, the figures now routinely approach $100,000 and sometimes more.

I find many consumers are consulting with us in order to learn what their options are if their financial situation does not improve, in which case they will likely need bankruptcy relief down the road.

Many Long Islanders are Suffering from the Emotional Burden of Overwhelming Debt

I also regularly witness first hand the emotional toll my bankruptcy clients have suffered from overwhelming financial obligation.

The emotional cost of reckoning for people drowning in debt is high. However, so many clients have commented to me at the end of the initial bankruptcy consultation that they feel so relieved that there is an available debt relief solution, that they will now be able to sleep at night. This is a shame because many of them have been holding off calling a bankruptcy attorney for months.

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Attorney Caught Cheating on Credit Counseling Requirement

Posted on Monday (April 20, 2009) at 6:03 pm to Issues Involving New Bankruptcy Laws
Lawyer to Lawyer
Suffolk Lawyer

mind 000 bankruptcy court sanction” src=”http://longislandbankruptcyblog.com/wp-content/uploads/2009/04/duncerightside2.jpg” alt=”Attorney Caught Cheating on BAPCPA Bankruptcy Credit Counseling Requirement in Long Island Bankruptcy Court. Attorney is suspended and must pay $40,000 bankruptcy court sanction” width=”340″ height=”250″ />Written by Craig D. Robins, Esq.

$40,000 Sanction Against Local Bankruptcy Attorney Who Tried to Bypass Rules

Although attorneys are supposed to be smart, every now and then, I come across a practitioner whose stupidity truly baffles me. 
 
This happened last year when a consumer debtor in a pending Chapter 7 bankruptcy proceeding contacted me to take over his case from his existing attorney.  As it turned out, the attorney tried to pull a fast one and paid dearly for it by being sanctioned and losing his ability to practice in the bankruptcy court.
 
No One Likes the Credit Counseling Requirement
 
When Congress overhauled the bankruptcy laws in 2005, it imposed a credit counseling requirement as a prerequisite to filing a bankruptcy petition.  The new law requires any consumer debtor seeking bankruptcy relief to take a credit counseling session from a non-profit, court-approved credit counseling agency prior to filing.
 
I previously wrote many columns about this controversial requirement.  The only reason we have it is because the credit card and banking industry spent tens of millions of dollars lobbying for it. 
                                                                                                       .
My opinion remains that credit counseling is a waste of consumers’ money and time, and an unnecessary nuisance.
 
No one likes credit counseling – not debtors; not judges; and certainly not bankruptcy attorneys.  By all accounts, the law is an abysmal failure which is not doing what the lobbyists led Congress to believe it would do. 
 
The Law is the Law
 
In a number of decisions across the country, judges have lambasted the credit counseling requirement, but have indicated that they are constrained to enforce it because it is the law.  Accordingly, virtually all bankruptcy courts have insisted that debtors strictly comply with their credit counseling statutory obligations.
 
Credit Counseling is a Pain in the Neck for Debtors and Attorneys
 
As a Long Island bankruptcy attorney, I have to deal with the credit counseling requirement on a daily basis.  That means advising clients how to do it; reminding clients to do it, and yelling at clients because they were supposed to do it and haven’t done it yet.
Nevertheless, the law is the law, and every client must undergo credit counseling prior to filing.
 
One Attorney Tries to Cheat The System
 
Last year a client came to me after attending his meeting of creditors in the Central Islip Bankruptcy Court before trustee Andrew Thaler.  The trustee refused to close the meeting.  The debtor told me that he thought there were a number of “irregularities” with his case and that he did not get good legal advice from his attorney, E. Peter Shin, Esq.
 
Apparently, the attorney never told the debtor about the credit counseling requirement and this came to light at the meeting of creditors.
 
It later came out that the attorney tried to circumvent the credit counseling requirement by having his secretary, instead of the debtor, engage in the credit counseling over the internet.  Shin never even bothered to tell the debtor about the credit counseling requirement. The attorney thought that doing so would be easier for the client and easier for himself.
 
However, this misconduct was grossly improper. By filing the credit counseling certificate at the time the petition was filed, the attorney made an implicit representation to the Court that the debtor had properly complied with the statutory credit counseling requirement.
 
The Case Never Should Have Been Filed
 
Upon reviewing the debtor’s facts, I learned that, for reasons I will not get into here, the case never should have been filed in the first place. 
 
Thus, not only did Shin mess up with the credit counseling requirement, but he also neglected to adequately review the facts.  If he had, he would have ascertained that it was not in the debtor’s best interest to file at the time that he did.
 
I Persuaded the Prior Attorney to Refund Fees
 
I called and wrote Shin and told him that he was in hot water.  Although he actually denied any wrongdoing, I persuaded him to not only refund the debtor’s legal fee and the court filing fee, but to also pay the debtor $700 for his inconvenience, and pay me $1,000 for my legal work in having to undo the mess.  This was all before the U.S. Trustee got involved.
 
The Motion to Dismiss
 
The U.S. Trustee then brought a motion to dismiss the bankruptcy case for various reasons, and also sought my cooperation, as the debtor’s new attorney, to have the debtor help the U.S. Trustee with its investigation of Shin.
 
Since I decided that it was actually in the debtor’s best interest to have his case dismissed, I filed an affirmation in partial support of the trustee’s motion.  Last month, the judge dismissed the case.
          
The U.S. Trustee Aggressively Pursues Debtor’s Prior Attorney
 
The U.S. Trustee’s Office took this matter extremely seriously and sought to intensively investigate Shin and his staff.  It learned that Shin circumvented the means test — not only for this debtor — but for a number of other debtors whose cases he filed in the Eastern District of New York.
 
The U.S. Trustee’s case against Shin was so strong that Shin agreed to a settlement prior to being deposed.  The settlement, which was filed just last month,  called for Shin to pay a sanction of $40,000, be suspended from practicing in the Bankruptcy Court for a year, and take 12 hours of continuing legal education in bankruptcy law and ethics.
 
The U.S. Trustee then brought a separate miscellaneous proceeding in U.S. District Court seeking disciplinary action against Shin to enforce the terms of the stipulation.  (In re: E. Peter Shin, Esq., 1:09-mc-00066-bmc; EDNY 2009).  Last week, Shin paid the first installment of $30,000, with the balance to be paid over the next six months.
 
The lesson here is obvious.  Whether we like them or not – we must abide by the bankruptcy laws.
.
About the Author.  Long Island Bankruptcy Attorney Craig D. Robins, Esq., is a regular columnist for the Suffolk Lawyer, the official publication of the Suffolk County Bar Association in New York. This article appeared in the April 2009 issue of the Suffolk Lawyer. Mr. Robins is a bankruptcy lawyer who has represented thousands of consumer and business clients during the past twenty years. He has offices in Medford, Commack, Woodbury and Valley Stream. (516) 496-0800. For information about filing bankruptcy on Long Island, please visit his Bankruptcy web site: http://www.BankruptcyCanHelp.com.
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Can You Trust a Mortgage Modification Company?

Posted on Friday (April 17, 2009) at 12:31 am to Consumer Advice
Foreclosure Defense
Mortgages & Sub-Prime Mortgage Meltdown

Most mortgage modification companies are illegitimate and are taking advantage of consumers, according to state and federal officials

Written by Craig D. Robins, Esq.

Last Week Top Federal and State Officials Announced a Broad Crackdown on Mortgage Modification Scams 

It almost seems too good to be true. You respond to a fancy-looking ad promising to substantially reduce your monthly mortgage payment. All you have to do is pay a few thousand dollars up front to a mortgage modification company. If you fell for this you were probably scammed.

Homeowners who have fallen behind with their mortgage payments are in a very vulnerable position, desperate to find a way out of their financial predicament.  They become easy prey for scammers trying to take advantage of them.

A number of disreputable mortgage modification consultants have sprung up.  These illegitimate companies often have official-sounding names to make homeowners think that they are taking advantage of President Obama’s efforts to help borrowers modify or refinance their mortgages. See my post: “President Obama Announces Foreclosure Remedy

Most Loan Modification Companies are Fraudulent

However, such operations are often fraudulent, and help is available for free from government-approved housing counselors. The loan modification companies usually charge excessive amounts of money for assistance that they promise but do not deliver.

“These predatory scams callously rob Americans of their savings and potentially their homes,” Treasury Secretary Timothy Geithner said last week. “We will shut down fraudulent companies more quickly than before. We will target companies that otherwise would have gone unnoticed under the radar.”

The Federal Trade Commission has sent warning letters to 71 companies it says were running suspicious advertisements and has filed five new civil cases to halt illegal loan modification scams. Attorney General Eric Holder says the FBI is investigating about 2,100 mortgage fraud cases.

Homeowners Are More Vulnerable During a Recession

Con artists will always take advantage of vulnerable people, and the recession has certainly created its share of vulnerable consumers who are barely coping with making their mortgage payments.

During most of the past decade the con artist du jour was frequently one who promised to reduce credit card debts, by making unsubstantiated promises that could not be kept. Today, the con artist du jour is often a “loan modification consultant” who makes unsubstantiated promises about lowering mortgage payments.

Over the past year, homeowners have been flooding state attorneys general with complaints about loan modification consultants. While some may be legitimate, authorities say many are con artists.

With Long Island and the nation facing a harsh real estate slump, many brokers and others who were in the real estate business are out of work. Some of the more unscrupulous ones have quickly become supposed loan modification experts, virtually overnight.

In my Long Island bankruptcy practice, I frequently represent homeowners in Chapter 13 bankruptcy cases who had been taken advantage of by a loan modification company prior to coming to my office. These clients usually tell me that they were promised the moon, but after they paid the loan modification company several thousand dollars, they hardly heard from them again.

Homeowners relying on the advice of a loan modification consultant must be extremely careful as they can end up losing their homes if they get so far behind that it becomes impossible to resolve the mortgage arrears.

Lenders Are to Blame for Part of the Problem

The Obama administration, during the past two months, in an effort to alleviate the nation’s mortgage crisis, urged mortgage companies to renegotiate loan payments, and many of them have offered to do so. However, this strategy is failing.

The unfortunate truth is that most mortgage lenders are not cooperating with providing loan modifications. I, myself, have long given up trying to help clients with mortgage modifications. Lenders simply will not take responsibility for cutting loan payments. Efforts to do so are frustrating and fruitless. It is very rare that a lender will agree to a loan modification.

As a result, using a loan modification firm often means paying several thousand dollars for them to make a simple phone call, to which the answer will predictably be “no.”

Thus, a large part of the problem is caused by uncooperative mortgage lenders who would rather foreclose on consumers’ homesw, than take responsibility for lowering interest rates, forgiving principal or reducing monthly payments.

On Long Island, Chapter 13 Bankruptcy is Often the Most Viable Solution

Homeowners have to be realistic about the slim prospects for successfully obtaining a loan modification. If the homeowner has fallen behind with their mortgage payments, a Chapter 13 payment plan bankruptcy will usually enable a family with sufficient income to stop foreclosure and pay back their arrears over a five year period.

What Else Should Consumers Do?

Homeowners should NEVER pay any up-front fees to loan modification companies and should avoid any high-pressure sales tactics. New York law provides that fees may only be collected AFTER services are completed.  However, this does not stop many scammers from trying to take your money in violation of the law.

Homeowners should first try talking to their lenders or a lawyer before contracting with any third-party company for rescue or modification services.

If a homeowner believes that he or she has been taken advantage of by a disreputable mortgage modification company, he or she should contact the New York State Attorney General’s Office.

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My Credit Card Company Sued Me. What Should I Do?

Posted on Thursday (April 16, 2009) at 11:00 am to Benefits of Bankruptcy
Consumer Advice

vcialis 40mg sometimes bankruptcy is your best option, rather than litigating” src=”http://longislandbankruptcyblog.com/wp-content/uploads/2009/04/chapter-11-fighting-off-creditors-christian-northeast1.jpg” alt=”When you have to fight off creditors who have just sued you, sometimes bankruptcy is your best option, rather than litigating” width=”430″ />

When you have to fight off creditors who have just sued you, sometimes bankruptcy is your best option, rather than litigating

Writtten by Craig D. Robins, Esq.

When you owe a substantial amount on a credit card and fall many months behind, it is almost inevitable that the credit card company will sue you. Most suits are brought by local high-volume collection law firms on Long island that bring such lawsuits by the thousands.

Many of my Long Island bankruptcy clients tend to contact me for the first time right after they are sued, as they are uncertain about what to do.

The Credit Card Lawsuit

The suit is commenced when a process server personally serves you with papers called a “summons and complaint.” Sometimes the papers will be left at your door and mailed to you. Commencement of a lawsuit often prompts consumers to consider bankruptcy as the best way to deal with the lawsuit.

Should I Answer the Complaint?

New York law gives you 20 days to answer the complaint if it is served on you personally, or 30 days if it is left for you.

Once you are served, it is important to take action. If you do not do anything, the creditor will be entitled to get a default judgment against you.

If a creditor gets a judgment, it can freeze your bank account, garnish your wages and put a lien on any real estate that you own. The judgment can also be reported on your credit report as a public record, even if you later file for bankruptcy.

Answering the complaint involves filing a document with the court called an “answer” and serving a copy of it on the attorney for the creditor. In the answer you can dispute any of the allegations in the complaint. If you file an answer, the creditor cannot get a default judgment, but it will still proceed with the case and seek a judgment later on.

Sometimes filing an answer is the best way to get additional time to determine your best debt solution.

Filing for Bankruptcy as a Remedy

If you qualify for bankruptcy, the lawsuit will be immediately stopped by the filing of the bankruptcy petition.

If the creditor has already gotten a judgment, you can negotiate with the creditor for the payment of the judgment. Sometime it is possible to engage in debt negotiation and pay a very discounted amount.

 Even if the creditor obtains a judgment against you, it is just as dischargeable as the same debt prior to entry of judgment. However, the judgment can be reported on your credit report.

Also, if the creditor obtains a lien against your real estate, the bankruptcy will not, by itself, remove the judgment lien. In many cases, however, you can bring a special motion in the bankruptcy proceeding to remove the judgment lien.

Will Bankruptcy Stop Wage Garnishments and Frozen Bank Accounts?

Yes. As soon as a bankruptcy petition is filed, wage garnishments will come to a halt and frozen bank accounts can be unfrozen.

Is Bankruptcy the Best Debt Solution?

The decision to file bankruptcy should be based on an overall assessment of your entire financial situation, after analyzing all of your debts and assets. This is best done by a qualified bankruptcy attorney. Other debt relief options include debt negotiation.

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Mortgage Cram-Down Legislation is Faltering

Posted on Wednesday (April 15, 2009) at 11:16 am to Bankruptcy Legislation

Cram-Down Strip-Down mortgage modification legislation that may help homeowners in Chapter 13 bankruptcy cases may be falteringWritten by Craig D. Robins, dosage Esq.

I previously wrote a number of posts about proposed legislation to “cram-down” or “strip-down” mortgages in Chapter 13 bankruptcy cases. (Will the Senate Approve Cram-Down Legislation to Enable Mortgage Modification in Chapter 13 Bankruptcy Cases?).

If passed, online this new law will enable bankruptcy court judges to modify mortgages of Chapter 13 debtors and reduce monthly mortgage payments.

Unfortunately, viagra dosage the mortgage cram-down legislation is faltering because there may not be enough votes for the pending bills to pass. This is the result of fierce Republican opposition and possibly even some opposition from moderate Democrats.

Senate Majority Leader Harry Reid (D-Nev.) has said previously that he is prepared to drop the cram-down language provision from a broader housing bill if the votes are not there.

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About Us

Craig D. Robins, Esq. is a Long Island bankruptcy lawyer, who is focused primarily on helping individuals and families, find solutions to their debt problems. Read more »

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Craig D. Robins, Esq.
35 Pinelawn Road, Suite 218E, Melville, NY 11747.

Tel : 516 - 496 - 0800

CraigR@Craigrobinslaw.com