For Debtors, Chapter 7 Liquidation is the ultimate relief, while Chapter 13 and 11 Reorganization offers an opportunity to reduce their Debtor’s payments in light of their income. In either type of case however, the Creditor is not entitled to anything until it has filed is Proof of Claim.Read More
In this carefully written Opinion Judge Schmetterer evaluates the arguments in a Motion to Dismiss an Adversary Complaint based on fraudulent behavior. Beyond its examination of Bankruptcy Fraud, this Opinion is notable for its recitation of the ways this former Attorney conned his Client out of money.Read More
One option for those who've gone through Bankruptcy and are looking to borrow again is the FHA Loan. Before the housing bubble burst in 2008 FHA loans were considered the choice for buyers with little credit or bad credit; or for those with low incomes. But since everyone's home value began falling - taking credit...Read More
Domestic support obligations are exempt from discharge in Bankruptcy and entitled to priority payment in a plan of reorganization. The tricky part is determining just what constitutes a "domestic support obligation" entitled to special treatment. Would a spouse's Attorneys' Fees be entitled to special treatment? Interest on unpaid sums? Court sanctions for unpaid support?Read More
The Bankruptcy Judge had the benefit of hearing the Debtor's testimony and deemed her credible: he knew her approach was wrong but thought she was sincere in her beliefs. The Appellate Court focused on the telltale signs that the Debtor had not been sincere and reasoned that it couldn't trust her as there were too...Read More
This Opinion from Northern District of Illinois Bankruptcy Judge Jack Schmetterer showcases the interplay of Federal and State law in a complex commercial scenario. It also displays the characteristic desire of Federal Courts to keep things clear and simple: which is unfortunately the opposite of how convoluted factual and legal situations play out in State...Read More
The Bankruptcy Court pries apart a Motion for Judgment on the Pleadings brought by banks and servicers that claim to be entitled to collect mortgage payments from the Debtor while peering into the world of securitized mortgages - the process of bundling loans into trusts, slicing trusts into securities, and trading those securities on Wall...Read More
As a Bankruptcy lawyer I can't count how many times people have asked why Courts won't reduce their mortgage debt to match the deflated value of their home, or why they should pay anything on that second mortgage, line of credit, or HELOC, when they're underwater. I even discussed these questions and the state of...Read More
The Judge tasked with managing the largest municipal Bankruptcy in American history cleared Detroit to emerge from its Chapter 9 reorganization and ended a series of hard-fought battle between creditors, citizens, employees, and pension recipients. Before approving the move though, Judge Rhodes issued a heart-felt plea: "move past your anger" and "fix the Motor City."Read More
In the recent case of Beeman et. al. v. Borders Liquidating Trust et al. from the Circuit Court for the Southern District of New York decided on October 29, that Court examined what ought to happen when relief that could be granted, for practical reasons is not. This controversial policy, referred to as "Equitable Mootness"...Read More