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Archive for the ‘Budget’ Category

Rules of 341 Meetings in Bankruptcy

September 10th, 2014 at 10:26 am

341 meetingAll Chapter 7 bankruptcy petitioners are required to attend a creditors meeting. This is typically the only “formal” meeting the petitioner will be required to attend. This meeting is also known as a 341 meeting, named after the section of the bankruptcy code that addresses it. A 341 meeting is most often held at the office of the trustee who is overseeing the bankruptcy.

Some of the documents that your bankruptcy attorney will have you prepare ahead of time to bring to the meeting include:

  • Paycheck stubs,
  • Federal and state tax returns for the past four years,
  • Any bank or other financial account statements, and
  • Property deeds and titles.

The petitioner is required to answer, under oath, questions that the trustee or any creditors may have.  One of the purposes of the meeting is to make sure the petitioner is not lying about or hiding any assets that could be used to pay off creditors. In most cases, the meeting itself does not last any longer than 15 minutes.

However, if a trustee is not happy with a petitioner’s answers, he or she can request the petitioner provide more documentation to support their answers. Often, this documentation can be mailed to the trustee. However, occasionally, the trustee will continue the meeting for another day. According to the 314 statute, if the trustee is requesting a continuance of the creditor’s meeting, then the trustee must immediately file a written notice of when the adjourned meeting will resume.

It is that rule that protected a Chapter 7 bankruptcy petitioner’s home when the trustee handling her case attempted to object to the homestead exception the woman had filed.

In her bankruptcy petition, the woman had filed a homestead exception for the home she owned. However, she and her husband had separated and the woman moved out of the home. At the creditor’s hearing, the trustee objected to the exemption and continued the meeting to a later, unspecified time.

The trustee then filed a written objection to the homestead exemption, but because he never filed a written continuance of the creditors meeting, the court allowed the homestead exemption in the bankruptcy.

If you are struggling with debt problems in the San Antonio, Texas area due to job loss, medical issues, or any other reason, seek help from an experienced San Antonio bankruptcy attorney today. Contact the Law Offices of Chance M. McGhee for all of your bankruptcy needs, and to start the process of financial relief and recovery.

Qualifying for Chapter 7 Bankruptcy

September 4th, 2014 at 10:35 am

Chapter 7 bankruptcyIn order to qualify for Chapter 7 bankruptcy, the U.S. Bankruptcy Court requires a person to pass a “means test.” This means test will determine if your Chapter 7 bankruptcy should be dismissed or if you should actually be filing for Chapter 13 bankruptcy.

In order to pass the means test, the courts look at your income for the prior six months before you filed for bankruptcy and then doubles that figure. That amount must be below the median level for the state you live in. In Texas, the annual median income is as follows:

  • Single person household: $41,960
  • Two person household: $57,121
  • Three person household: $60,440
  • Four person household: $69,570
  • Add $8,100 per person over four

If your income falls below the median, then you should have no problems qualifying for Chapter 7 bankruptcy. If it goes above, then a qualified bankruptcy attorney can go over what other options you may have.

If you have an occupation that you earn more money or where your monthly income fluctuates, then the time of year you file could make all the difference in whether or not you will meet the means test and qualify.

Teaching is a perfect example of this type of occupation. Teachers typically work ten months per year, from September until June. During the summer vacation months of July and August, they do not draw paychecks. September could be the best time for a teacher to file bankruptcy, since the court does not count checks for the month you file in. This means that the teacher’s checks for the months of March through August will be used to calculate the means test. Since July and August are “checkless” months, this means only four months of income will be used for the calculation and could make a difference in qualifying for Chapter 7.

If you are struggling with debt problems in the San Antonio, Texas area due to job loss, medical issues, or any other reason, seek help from a experienced San Antonio bankruptcy attorney today. Contact the Law Offices of Chance M. McGhee for all of your bankruptcy needs, and to start the process of financial relief and recovery.

Issues in State and Federal Minimum Wage Laws

August 22nd, 2014 at 4:41 pm

federal minimum wageThe minimum wage was a concept put in place to protect workers from the past tyranny of their employers. Larger companies can hold a lot of sway over the heads of individuals depending on a paycheck to put food on their tables and provide themselves and their families with the basic living necessities. This system also prevents businesses and business owners from auctioning off jobs, until men and women are forced to work for cents on the hour.

The problem with Texas minimum wage is exactly what it describes–the smallest amount an employer can legally pay his or her employees. Over the last few years in particular, many people are beginning to ask themselves and their legislatures whether the minimum wage laws are progressive enough to have evolved with society.

The current minimum wage in the State of Texas is only $7.25 per hour, the federally mandated minimum wage. While many other states have their own minimum wage laws that increase this rate, Texas is not one of them. The following statistics about the cost of living in Texas can be startling compared with its already low minimum wage:

  • The average cost of a one bedroom apartment in Houston is $1,144 per month;
  • A gallon of gas is priced at a little over $3.60 each;
  • One ride on public transit costs $1.25;
  • A regular gallon of milk is priced at $3.28;

Basing this on an average 40 hour work week, if you were getting paid minimum wage, then you would be making $1,160 before taxes are taken out, meaning that this income is not even enough to pay the rent of a one bedroom apartment in Houston. To make matters even worse, there are exemptions on certain employees that do not even have to be paid the $7.25 an hour:

  • Certain agricultural workers are not covered under the law;
  • Populations of mentally handicapped individuals can be exempt;
  • Employers may factor in the cost of meals and/or lodging into the compensation they offer.

The economy in Texas, though improving slightly, has still left many in dire financial constraints. The minimum wage law is lacking in some aspects, leaving bankruptcy the only options for many residents of the state. If this is you, contact a New Braunfels bankruptcy attorney today for experienced legal assistance with all of your bankruptcy needs.

2014 is the Year to Get Rid of Debt

January 28th, 2014 at 5:58 pm

Since the ball dropped on New Year’s Day, people have been trying to keep their resolutions. Whether that is quitting smoking, losing weight, or just improving quality of life, keeping up with resolutions can be a challenge. Another common resolution is to get out of debt, and 2014 could be the year for it.

eliminate debt IMAGEThe first step to tackling debt is to list all outstanding balances. Include everything that you might owe for your mortgage, student loans, auto loans, credit card bills, or other bills. It is also important to include the interest rates on these bills so that the most expensive debts are dealt with first.

The next step is to track your spending. Using a year’s worth of bank statements and credit card statements, find out what you spend each month. This will let you see which expenses are necessary and which are not. Use this as a starting point in creating a budget that you can live with, and stick to it. That will allow you to trim any wasteful spending and reallocate those funds to getting rid of debt quickly.

While fun activities may be difficult to cut out, they should be the last thing to budget for. Remember that credit cards are not free money, you will have to pay them off and you will be charged interest on any outstanding balance every month. Celebrate your success when you reach milestones so that you will stay motivated to see your plan to the end.

If you have tried all these steps and still cannot get ahead, then it is time for plan B. Maybe you have lost your job, or experienced an expensive illness or injury, or other unexpected event that makes it difficult to get out of debt. Filing for bankruptcy can let you start over financially. Contact an experienced bankruptcy attorney in San Antonio to review your finances today and make this year the one where you get out of debt.

How Payment Methods Influence Consumer Spending Habits

September 14th, 2013 at 10:44 am

multiple credit cards

Americans say that they are spending less money on extras like restaurants, bar tabs and the like compared to 2012.  That is according to a survey conducted by the consumer research team Mintel.  They surveyed Americans about consumer spending habits for thirteen different categories.  The only two categories that consumers admitted to spending more on were groceries and household care items.

This might not be the case according to consumer spending data.  That research has shown that spending has increased for several of the categories surveyed by Mintel by as much as five percent.  This discrepancy could be caused by a small percentage of consumers who have spent more money on luxury and big ticket items.

It could also be caused by the confusion resulting from having so many ways to pay for things.  These days, each consumer has access to multiple lines of credit and multiple choices for paying for items.  There are credit cards, debit cards, pre-loaded cards, cash, checks and many others which can result in a lot of spread out debt.  While it is normally good to have many options, there is one case that it may be better to have only one option.

If you are trying to spend less and save more, having just one account can result in fewer bills to pay.  That is according to a study that was published in the Organizational Behavior and Human Decision Processes journal.

The study was set up to include over 90 people.  Half of the people were given only one account with a set amount of money to do some online shopping.  The other half was given the same set amount distributed over multiple accounts.  Overall, those people with multiple accounts ended up spending 10 percent more than those with only one account.

It seems that over more accounts, people are able to rationalize their purchases.  If a misperception of your debt has led you to problems with debt collectors, consider filing for bankruptcy.  Contact an experienced bankruptcy attorney in San Antonio who can help you see if bankruptcy is right for you.

Strategies for balancing your budget

May 28th, 2013 at 4:57 pm

Lara May1  BudgetWith the economic downturn that took place in the United States over the past few years, some people are still struggling to get back on their feet.  A recent article has listed a few easy tips that could make balancing your budget and getting a handle on debt a much easier task.

  1. Spend extra money on credit card and loan balances.   USAA member Nikki Tracht and her family had been dealing with extreme levels of debt.  One of the things she learned was to start using any extra money on bills and loan balances. With her new system, Tracht makes minimum payments on all bills…except the one with the lowest balance.  Her extra money goes toward that one, so one bill is getting paid off completely at a time.
  2. Selling or returning what you’re not using. Many other members of USAA say that they usually sell their extra unneeded items online, because every dollar you get back counts.  The money earned can go towards your credit card bill and any other unpaid loans.
  3. Freeze your credit-literally.  One member of USAA, Jessica Otieno, found a solution to spending money on things she didn’t need by actually sticking her credit card in water and then keeping it in the freezer.  According to Otieno, “I figure if it’s something I really need, it will be there in a few hours when I need it.  And for now it’s locked out of my mind, so it’s not such an easy temptation.”
  4. Lower your rates.  One strategy that can really add up to a lot of savings is to reduce your interest rates and change your W-4 withholding.  It can sometimes just take a simple phone call to lower the interest rate on your credit card.  You can lower your interest while paying off the debt, getting rid of it even more quickly.  Tracht decided to adjust her W-4s so that she could get more money back each month instead of waiting for an income-tax refund.  She uses this money to pay off her debts more quickly.
  5. Look at your bank statements for any monthly auto-debited financial commitments.  When doing this, it’s helpful to see what you can cancel until you have a handle on your debt.  There are many things you can do without for a short while, such as gym memberships or cable, until your finances are under control.
  6. Don’t spend unless you have it.  USAA member Treva Tribit described how her family of ten has found ways to cut back.  Both her and her husband took on extra jobs and made use of coupons as much as she could.  They also decided to downsize their home and move somewhere that fit their family without being more than they could afford.  By cutting back and being careful what you’re spending, a lot of debt can be reduced.

Although sticking to a budget can help, many people in the state of Texas are battling credit card and loan debts.  If you or a loved one are facing a potential bankruptcy, be sure to contact an experienced Texas bankruptcy attorney to assist you.

Call today for a FREE Consultation


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