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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.

Bankruptcy Practice

I Can Now Legally Advise My Long Island Bankruptcy Clients to Incur Debt in Contemplation of Bankruptcy

Posted on Monday (March 8, 2010) at 8:45 pm to Bankruptcy and Society
Bankruptcy Practice
Issues Involving New Bankruptcy Laws
Photographs of Max
Recent Bankruptcy Court Decisions

Long Island Bankruptcy Attorneys can now advise clients to incur debt in contemplation of bankruptcyWritten by Craig D. Robins, Esq.
 
High Court Issues Decision on Attorneys’ Ability to Give Legal Advice to Bankruptcy Clients
 
The U.S. Supreme Court ruled today that a provision of the 2005 Bankruptcy Act, which bars attorneys from advising clients to take on more debt before filing for bankruptcy protection, is permissible in certain situations.
 
I first wrote about this case, Milavetz, Gallop & Milavetz v. United States, a year and a half ago when the Eighth Circuit Court of Appeals ruled that the provision was unconstitutional:  Portion of New Bankruptcy Laws Declared Unconstitutional. Court of Appeals Strikes Down Provision which Prevented Attorneys from Advising Clients
 
The Court of Appeals had ruled that the provision barring such advice was unconstitutionally broad and violated free-speech rights
 
Now, the Supreme Court unanimously reversed that ruling, but with a caveat.
 
Today’s decision, which was written by Justice Sonia Sotomayor, said the provision prohibiting such advice was valid, but should be read narrowly.  She said that the law only prohibits attorneys from advising clients to abuse the bankruptcy system.
 
However, Justice Sotomayer indicated that it would be permissible for lawyers to advise clients contemplating bankruptcy to take on additional debt in certain situations.  She wrote that bankruptcy lawyers could advise clients to refinance a mortgage or purchase a reliable car prior to bankruptcy on the grounds that doing so would reduce the debtor’s interest rates or improve the debtor’s ability to repay.
 
“It would make scant sense to prevent attorneys and other debt relief agencies form advising individuals thinking of filing for bankruptcy about options that would be beneficial to both those individuals and their creditors,” Sotomayor wrote.
 
Professionals specializing in bankruptcy “remain free to talk fully and candidly about the incurrence of debt in contemplation of filing a bankruptcy case,” Sotomayor wrote.
 
How This Decision Affects Bankruptcy Attorneys and their Clients
 
I often encounter a situation where my client’s car lease is about to end.  Before the 2005 Bankruptcy Amendment Act (BAPCPA), I would have simply advised the client to immediately surrender the existing car and obtain a new car lease or car loan, as getting a new car is easier to do before filing for bankruptcy than after.
 
However, BAPCPA contained a provision which prevents attorneys from advising clients to incur debt in contemplation of bankruptcy.  So, for the last five years, I’ve been technically unable to give clients such advice.
 
Today’s Supreme Court decision now clarifies that as long as my advice is not meant to abuse the system, it is considered appropriate.  Of course, a bankruptcy attorney cannot advise a client to go out and charge up debt when the client has no reasonable expectation to repay it — providing such advice would be considered abuse, and therefore a violation of the statute.
 
I view the decision as a victory of sorts because it enables us bankruptcy practitioners to do what we’ve wanted to do all along:  give honest and appropriate advice to clients in order to reach a beneficial result, as opposed to taking advantage of the system and defrauding creditors.
 
Bankruptcy Attorneys Are Debt Relief Agencies
 
Justice Sotomayer also upheld the BAPCPA’s requirement that attorneys make certain disclosures in their advertisements and ruled that attorneys who provide bankruptcy assistance are debt relief agencies within the meaning of the law.
 
Having to label bankruptcy attorneys as “debt relief agencies” seems silly, and serves no useful purpose.  However, the requirement is rather benign, and more of a nuisance than anything else.
 
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About the Photo:  That’s my son, Max.  To see more Max, click:  Super Ninja Bankruptcy Attorneys
 
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Bankruptcy Issues Involving HAMP (Home Affordable Modification Program) — Part One

Posted on Monday (March 8, 2010) at 1:30 am to Bankruptcy and Society
Bankruptcy Practice
Chapter 13 Bankruptcy
Chapter 7 Bankruptcy
Mortgages & Sub-Prime Mortgage Meltdown

 Bankruptcy issues with HAMP (Home Affordable Modification Program) Written by Craig D. Robins, Esq.
 
I just attended a seminar last week offered through the National Association of Chapter 13 Trustees about HAMP.  Here’s some useful information.
 
Today’s post is Part One.   I will continue tomorrow with a detailed discussion of bankrutpcy issues.
 
What Is HAMP?
 
HAMP (Home Affordable Modification Program) is one of President Obama’s initiatives to make a dent in home affordability by using the economic bailout program.
 
It’s a quasi-voluntary program to modify home mortgages with the goal of getting the monthly payment to 31% of gross (pre-tax) income. 
 
The program seeks to provide taxpayer-funded incentives to mortgage servicers and lenders to voluntarily modify mortgages.  The program was created in March 2009.  This government program earmarked $75 billion for this purpose.
 
HAMP will reduce a homeowner’s monthly mortgage payment on a TEMPORARY basis.  However, the adjustment becomes permanent after the homeowner makes three on-time payments.
 
The incentive for mortgage lenders in doing this is that the Obama administration is offering big bucks in incentive payments to lenders.
 
Here is the official link to Home Affordable Modification Program.
 
Home Affordable Modification Program Has Not Worked Well So Far
 
To date, results for HAMP have been very disappointing.  I wrote about this at length two months ago:  Obama’s “Making Homes Affordable” Mortgage Modification Program Failing
 
The program has only resulted in 116,000 permanent modifications in the entire country, in which each borrower is saving about $500 per month. 
 
Incidentally, these homeowners typically went from paying 45% of their gross income towards their mortgage, down to 31%, which is the goal of the program.
 
To date, only 110 mortgage servicers have signed participation agreements.  All Fannie Mae and Freddie Mac loans are automatically eligible.
 
Who Is Eligible for HAMP?
 
Here are the requirements:
 
1.    You must be the owner and occupant of the home and utilize it as your primary residence
2.    You must have a maximum principal balance of $729,750
3.    You must have a monthly mortgage payment that is greater than 31% of pre-tax monthly income
4.    You must be unable to afford your current payment
5.    You must not have applied for HAMP before
 
Why Have Many Considered HAMP to be a Failure So Far?
 
Many homeowners applied for HAMP assistance because they thought it would help them avoid bankruptcy. However, a great many mortgage servicers were unprepared to handle HAMP applications and were not able to process the mortgage modification requests quickly enough to offer any real relief.
 
Some problems were highly publicized.  For example, there have been lenders who refused to even acknowledge receipt of mortgage modification documents, and other lenders who lost these documents numerous times for the same homeowner.
 
To Be Continued This Week
 
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Retainer Agreements in Bankruptcy Cases

Posted on Thursday (January 21, 2010) at 2:00 am to Bankruptcy Practice
Bankruptcy Tips Consumers Should Know

bankruptcy-retainer-agreementsWritten by Craig D. Robins, Esq.
 
Having a written retainer agreement in a consumer bankruptcy case is not only important, it’s the law.
 
For the 20+ years that I have been representing clients in bankruptcy cases, I have always used written retainer agreements.  Four years ago, when the bankruptcy laws were changed, written retainer agreements became mandatory.  Even so, there are some sloppy bankruptcy attorneys who neglect to use them.
 
A written bankruptcy retainer agreement clearly sets forth the understanding between the bankruptcy attorney and the bankruptcy client.  It also sets forth what services are included and what services may not be included.  Several years ago I wrote an article for the Suffolk Lawyer about Best Practices for Representing Your Clients and discussed the importance of using a plain-English written retainer agreement. 
 
Bankruptcy court rules require the bankruptcy attorney to file some forms with the petition indicating the amount of the legal fee.  Sometimes counsel files a copy of the retainer agreement to support this disclosure.
 
A properly-prepared retainer agreement also indicates what the bankruptcy legal fee is, the amount of the filing fee, and whether there are any disbursements, such as those for obtaining a credit report or for advancing the costs of credit counseling.
 
My retainer agreements also indicate what obligations my clients have.  These include simple things such as reading mail that I send them, agreeing to provide correct and accurate information, and letting me know if there are any significant changes in their circumstances.
 
If you are filing for personal bankruptcy, make sure your attorney prepares a written retainer agreement, and of course, make sure you read it before signing it; ask any questions if you do not understand it; and make sure you get a copy of it.
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Practicing Bankruptcy Law is Like Shooting a Moving Target

Posted on Monday (January 18, 2010) at 6:30 pm to Bankruptcy Practice
Bankruptcy Tips Consumers Should Know

42-17769483Written by Craig D. Robins, Esq.
 
The Importance of Experienced Counsel in Bankruptcy Cases
 
Let’s start with the likelihood of success of a debtor filing a pro se Chapter 13 bankruptcy case.  It’s virtually zero.  There is almost no chance of success.  This is based on regular reports from Chapter 13 trustees around the country.
 
But suppose you retain a Chapter 13 lawyer.  Does that mean you will definitely succeed with your case?  Not necessarily.  A debtor’s success with a Chapter 13 bankruptcy is still not assured merely because you are being represented by counsel.
 
What’s most important in having a successful Chapter 13 case is the competence and ability of the debtor’s attorney, the attorney’s understanding of the law, and his or her appreciation of the responsibilities and obligations of the attorney-client relationship in bankruptcy cases.
 
These were the comments of my colleague, bankruptcy attorney William J. McLeod, who spoke at a consumer bankruptcy seminar in Boston this afternoon which was attended by several hundred bankruptcy attorneys from across the Northeast.  Bill is the author of a great little resource book for bankruptcy attorneys, Chapter 13 in 13 Chapters.
 
The Bankruptcy Battleground is Constantly Changing Whether It’s Chapter 7 or Chapter 13
 
Here’s why having experienced counsel is so important.  Practicing bankruptcy law is in essence like shooting a moving target.  The rules are constantly changing, the law is constantly changing, and the bankruptcy court’s interpretation of the law is also constantly changing.
 
What a debtor might be able to get away with one month can be shot done the next month, and visa-versa.
 
For example, last month I wrote about a bombshell decision from Long Island Bankruptcy Court Judge Dorothy T. Eisenberg who had just come down with a decision permitting Chapter 7 debtors to cram-down second mortgages.  (Chapter 7 Cram-Down of Second Mortgages ). Obtaining this relief was previously impossible in the Bankruptcy Court for the Eastern District of New York.
 
My office quickly seized on this new avenue of legal relief, and we are now helping a number of clients to eliminate their second mortgages in Chapter 7 cases. 
 
However, most attorneys still do not even know about this new decision as the Judge delivered it with no fanfare or other formal announcement.  To my surprise, the Judge didn’t even mention it at a recent bankruptcy seminar. 
I learned about it because I regularly read every new bankruptcy court decision that comes out of the Long Island Bankruptcy Court.  I asked the judge why she didn’t mention the decision at the seminar and she said that she assumed all bankruptcy counsel regularly read the new case decisions.
 
Having experienced bankruptcy counsel is necessary to properly evaluate a potential bankruptcy filing, develop an appropriate bankruptcy strategy, and then communicate with the clients so that they understand how the bankruptcy case will work.
 
Debtor’s Counsel Plays an Integral Role in the Bankruptcy Process
 
When you have questions about your bankruptcy, you call your bankruptcy attorney.
When creditors have a question or concern, they call debtor’s bankruptcy attorney.
 
When trustees file a motion to dismiss, it is debtor’s bankruptcy counsel who must respond, appear and when appropriate, defend the matter in bankruptcy court.
 
Without any doubt, debtor’s counsel plays an integral role in the bankruptcy process.
 
Bottom Line:  If you want to make sure your bankruptcy case is successful and that you get the maximum amount of debt relief the the bankruptcy laws afford you, use a competent and experienced bankruptcy attorney.
 
When a client comes in to meet with one of my Long Island bankruptcy attorneys or me, they can be assured of getting personal attention and up-to-date bankruptcy advice, based on our experience and knowledge.
 
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Woman Gets Bankruptcy Discharge Without Having to Show Any Photo Identification

Posted on Monday (November 2, 2009) at 9:00 pm to Bankruptcy Practice
Recent Bankruptcy Court Decisions

One debtor was excused from showing photo identification at her meeting of creditors in bankruptcy courtWritten by Craig D. Robins, Esq.
 
Last week I wrote a post in which I said that You Need Certain Identification to File for Bankruptcy .   I did have one unusual case in which my client could not obtain the necessary photo ID.
 
Several years ago I represented a disabled woman through the Volunteer Lawyers Project.  She had no photo identification when she came to my office and had never driven a car in her life.   In addition, she had never worked.  As you can imagine, she never received a driver’s license or any other kind of photo identification. 
 
I sent her to the NYS Department of Motor Vehicles to get an official New York State identification card, but they refused to give her one because she had no other sources of identification to prove who she was. 
 
When I filed her bankruptcy case in the Central Islip Bankruptcy Court, the Chapter 7 trustee, Allan B. Mendelsohn, eventually agreed to examine her at the meeting of creditors, but did not officially close the meeting.  I then brought a motion to waive the identification requirements after reviewing the matter with the Office of the United States Trustee.  The motion was granted, the trustee closed the meeting of creditors, and the debtor received her discharge.
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You Need Certain Identification to File for Bankruptcy

Posted on Friday (October 30, 2009) at 4:00 am to Bankruptcy Practice
Bankruptcy Tips Consumers Should Know

Debtors filing personal bankruptcy must show identification at the meeting of creditorsWritten by Craig D. Robins, Esq.
 
Everyone who files for personal bankruptcy must produce identification.  You are not required to produce identification at the time of filing, but at the meeting of creditors which occurs one month later.  However, any experienced bankruptcy attorney will want to see that ID from the outset.
 
The Office of the United States Trustee adopted a policy in 2002 in which individuals are required to identify themselves with picture identification (typically a driver’s license) and proof of correct Social Security number (typically a Social Security card).
 
However, other forms of proof are acceptable as well.  According to instructions about identification issued by the Office of the United States Trustee, Chapter 7 and Chapter 13 trustees should also accept the following items as acceptable forms of photographic identification: passport, legal resident alien card, military identification, or state-issued photo identification card.
 
Satisfactory proof of Social Security number can be also demonstrated with the following documents as long as they contain the full Social Security number and full name of the debtor:  pay stub, health care card, any correspondence from the Social Security Administration, or a current W-2.
 
I’ve actually attended hearings in which I observed some local trustees in the Central Islip Courthouse being unaware that a debtor can furnish proof of Social Security number with some of the above documents.  Hopefully all of the trustees have become aware of the U.S. Trustee’s policies by now.
 
If the debtor does not have photo identification and proof of Social Security number with them when they appear before the trustee at the meeting of creditors, the trustee can refuse to examine them.
 
In my practice, I require all clients to provide me with their driver’s license and Social Security card at the initial intake. I then make a legible photocopy and place it in the file. On numerous occasions these copies have saved the day when the client forgot to bring their ID to the court. Also, by reviewing the debtor’s identification early on, I have time to enable the debtor to obtain satisfactory identification there is a problem with it.
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My Favorite Bankruptcy Book

Posted on Wednesday (August 12, 2009) at 11:45 am to Bankruptcy Practice
Lawyer to Lawyer
Resources

book-consumer-bankruptcy-law-and-practiceWritten by Craig D. Robins, Esq.
 
Ever since I started practicing bankruptcy law over twenty years ago, I’ve relied on one law book more than any other:  Consumer Bankruptcy Law and Practice.
 
Published by the National Consumer Law Center, it is now in its Eighth Edition.  It is my favorite bankruptcy handbook and I often refer to it as the bankruptcy bible.
 
This is the definitive consumer manual and the must-have book for any attorney who practices bankruptcy.  It is now takes up two volumes for a total of well over thirteen hundred pages.  There are excellent summaries of almost every possible bankruptcy issue, together with case citations, sample pleadings, a full copy of the Bankruptcy Code and Rules and more.  It’s cost of $180 is well-worth it.  Also included is a CD-Rom.
 
The only downside for Long Island bankruptcy attorneys is that it does not focus on any New York issues or exemptions.
 
The publisher, the National Consumer law Center, is a not-for-profit operation that emphasizes education and advocacy to help and protect consumer rights.  You cannot go wrong with this book.
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Interpreters in Bankruptcy Court

Posted on Thursday (August 6, 2009) at 3:45 am to Bankruptcy Practice
Bankruptcy Tips Consumers Should Know
Central Islip Bankruptcy Court & Judges
Info on Bankruptcy and the Court
Lawyer to Lawyer

Interpreters are now available in Central Islip Bankruptcy Court and Brooklyn Bankruptcy CourtWritten by Craig D. Robins, Esq.

What happens if you are a debtor in a bankruptcy case and you can barely speak English?
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Free English translation services now available in our Long Island Bankruptcy Court
 
The U.S. Trustee Program recently began offering free translation services.  The service is limited to assisting non-English speaking debtors at the meeting of creditors, which is also known as the section 341 hearing.
 
The first time I saw this in action I was amazed at how smoothly the process worked.  I was at a meeting of creditors a few months ago with some Spanish-speaking clients.  The trustee was Andrew Thaler who had never utilized the service before.  Using a telephone in the meeting room, the trustee called a central translation service switchboard, provided some info, and within minutes was connected to a Spanish-speaking interpreter.
The interpreter methodically translated through the speaker phone, and there were no problems at all. 
 
In the past, a debtor with limited English proficiency would have to bring their own interpreter with them, who was often a family member.  Although this had worked smoothly with most trustees, some trustees were not too willing to let family members serve as interpreters because of potential bias.
 
The new system, which is in accordance with an Executive Order from the President requiring federal agencies to have a Language Assistance Plan, provides interpretation services in as many as 196 languages.  Currently the service is only available in some areas and we are fortunate enough to have it in the Central Islip and Brooklyn Bankruptcy Courts.
 
To minimize delays at the meeting of creditors, debtors wishing to take advantage of this free service are encouraged to have their bankruptcy attorney contact the trustee in advance of the meeting. 
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All New York Bankruptcy Attorneys File Bankruptcy Petitions Electronically

Posted on Tuesday (August 4, 2009) at 5:00 pm to Bankruptcy Practice
Info on Bankruptcy and the Court

All New York Bankruptcy Attorneys File Bankruptcy Petitions ElectronicallyWritten by Craig D. Robins, Esq.
 
Since 2003, the Central Islip Bankruptcy Court has required all Long Island bankruptcy attorneys to file their clients’ bankruptcy petitions electronically — that means by computer over the internet.
 
Known as Electronic Case Filing, or E.C.F., this has made the filing process extremely efficient.  After my client signs his or her bankruptcy petition, one of my paralegals makes an electronic file copy of it (called a PDF copy) which we then send to the bankruptcy court’s computer right from our desk.
 
Not all attorneys are permitted to file electronically.  Attorneys must register with the bankruptcy court and take a seminar that the court offers before being allowed to use this filing system.
 
With electronic case filing, in an emergency, a bankruptcy petition can be filed in minutes without leaving the office.
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Supreme Court to Review Several Bankruptcy Cases Next Term

Posted on Wednesday (June 17, 2009) at 9:42 pm to Bankruptcy Means Test
Bankruptcy Practice
Chapter 13 Bankruptcy

Supreme Court to Review Several Bankruptcy Cases Next Term.  The decisions will affect Long Island bankruptcy attorneys and their clients.Written by Craig D. Robins
 
These Supreme Court decisions will govern how consumer bankruptcy attorneys represent their clients and what we can expect with some important consumer bankruptcy issues
 
The United States Supreme Court has granted certiorari to review decisions in three bankruptcy matters and is considering whether to review others.
 
Constitutionality of New Bankruptcy Laws
 
I wrote about one of these cases previously when the Court of Appeals had issued a decision concerning the constitutionality of the 2005 Bankruptcy Amendment Act.  See Portion of New Bankruptcy Laws Declared Unconstitutional. Court of Appeals Strikes Down Provision which Prevented Attorneys from Advising Clients .  Milavetz, Gallop & Milavetz, P.A. v. U.S., 541 F.3d 785 (8th Cir., Sept. 4, 2008).
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In that case the Supreme Court will be addressing whether consumer bankruptcy attorneys have the First Amendment right to advise bankruptcy clients that theymay incur new debt prior to filing.
 
Exemptions and Valuing Assets
 
The Supreme Court will also be reviewing the case of In re Reilly, 534 F.3d 173 (3rd Cir., July 21, 2008), which held that, by claiming an exemption in an amount identical to the stated value of the asset, the debtor put the trustee on notice of the debtor’s intention to exempt the full value of the asset, regardless of what that value might turn out to be or whether there was a limitation on the amount of the available exemption.
 
Discharging Student Loans Through Chapter 13 Plans
 
In addition, the Court announced this week that it will review the case of in Espinosa v. United Student Aid Funds, Inc., 553 F.3d 1193 (9th Cir., Dec. 10, 2008). In that case, the Ninth Circuit Court of Appeals ruled that the treatment of a student loan debt in a confirmed Chapter 13 plan of which the student loan creditor has actual, timely notice binds the creditor if the creditor fails to object to confirmation of the plan, even if the debtor has not established “undue hardship” as called for in Code § 523(a)(8).
 
The downside of the Supreme Court review is that the lower court decisions by the Court of Appeals are rather debtor-friendly.  Since the current makeup of the Supreme Court often results in conservative decisions, there is a possibility that these cases could be overturned, which would not be good for consumer debtors or their attorneys.
 
The Issue of Calculating Income on the Means Test
 
In addition, there is another very important case which the Court is considering whether to review. That case is In re Lanning, 545 F.3d 1269 (10th Cir., Nov. 13, 2008), which holds that a Chapter 13 debtor’s projected disposable income is calculated in a forward-looking, rather than a mechanical, manner. 
 
A forward-looking approach is what Judge Grossman, in our Long Island Bankruptcy Court in Central Islip, used to analyze the Chapter 13 case of Almonte, which I wrote about in a post discussing his decision:  Cash Advances Are Not Pre-Petition Income 
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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