Cherry Hill Bankruptcy Blog

Medical bills are the leading cause of bankruptcy

Nearly 67% of all personal bankruptcies in the U.S. are related to medical bills. This shocking percentage makes medical bills the leading cause of bankruptcy. Serious medical conditions can be extremely expensive, and Americans are unable to afford the cost—even if they have health insurance.

These medical expenses are often unforeseen and can cause the individual to go further into debt. Serious medical conditions may necessitate expensive medical care and a long recovery period.

Retailers Struggle to Avoid Bankruptcy

On line shopping and high rent costs, among other things has caused multiple retailers to seek protection in Chapter 11 bankruptcy or file Chapter 7 bankruptcy and close. Competition from on line sellers combined with high operating costs are the leading causes. It seems like another large retailer may soon be in bankruptcy. According to USA Today , the retailer Barney's is considering filing a bankruptcy. The reasons given are pretty typical of the problems facing many retailers today. A combination of high rent and online competition. The final straw may have been a rent increase at the Madison Avenue location which according to USA Today went from$16 to $30 million in January. The impact on the Philadelphia Pennsylvania Barney's is still unclear. Choices of retailers may soon be a thing of the past.

Why more older Americans are filing for bankruptcy than in 1991

If you have considered filing for bankruptcy, then you may understand the feelings of fear and uncertainty that come with it. Though it’s a chance to start over financially, it’s not something most people want in their lives. But for many older Americans, it’s quickly becoming their only option.

A study of bankruptcy filings found that Americans ages 65 and older accounted for about 12% of all filings, an increase from just 2% in 1991. Though the numbers seem relatively low, it signals that more people are finding themselves in financial distress than 30 years ago. It begs the question: why?

First Day Orders in Chapter 11 Bankruptcy Cases

When a Chapter 11 business bankruptcy is filed, as a general rule the debtor company cannot pay prebankruptcy debts until a plan or reorganization is approved many months letter. However, in certain circumstances the inability to pay certain prepetition debts can put the company out of business. For example, if a bankruptcy is filed on a Thursday and the next day payroll is to be paid for the prior 2 weeks, the company must be able to pay that or will lose many employees. Or a company might be dependent on the services of a vendor such as a vendor that provides packaging for items sold by debtor. To avoid impacting the debtor the rules provide the opportunity to file a motion to be heard almost immediately on the first day the bankruptcy is filed. The rules such as New Jersey local bankruptcy rule 9018 require immediate notice by telephone and email to creditors to have an opportunity to respond or object. While the creditors have limited time to respond these orders are necessary if a reorganization is to be successful 

Can I File a Bankruptcy a Second Time?

A bankruptcy can be filed a second time. The impact of filing depends on how long before was the prior bankruptcy filed and what chapter was filed and whether a discharge was received in a prior bankruptcy. If a discharge was received in a chapter 7, you cannot receive a discharge in another chapter 7 for 8 years. You can obtain a discharge in a chapter 13 filed  6 years after the chapter 7. Since bankruptcy is Federal law, these same rules apply even if , for example, you file the first bankruptcy in Maple Shade New Jersey and file second bankruptcy while livin in Philadelphia Pennsylvania. If you previously filed a chapter 13 bankruptcy and received a discharge you can obtain a discharge in a later chapter 13 filed 4 years later or a chapter 13 filed 2 years later. Keep in mind that you may benefit from a chapter 13 even if you cannot get a discharge, for example if a chapter 13 is needed to pay missed mortgage payments over time.

New Philadelphia Location for Meeting with Creditors

Whether you live in Northeast Philadelphia, Center City Philadelphia, or elsewhere in the city, when you file a Chapter 7 or a Chapter 13 Bankruptcy you are required to attend a "Meeting of Creditors". In most consumer cases none of the creditors show up. However, you still meet with the trustee to review your case. For a number of years the Chapter 7 meeting with the trustee took place at 833 Chestnut Street, Philadelphia PA. However, as of May 6, 2019 the Office of The United States Trustee has obtained space in the Nix Courthouse and Federal Building at 900 Market Street, room 304, Philadelphia PA. Since the meetings are now in a federal court house protected by US Marshall's office and metal detector's it is important that debtors allow additional time to make it to the hearing. The Chapter 13 Meeting of Creditors which moved a couple of years ago to 1234 Market Street (SEPTA Building) Suite 18-341 Philadelphia PA is to remain at that location.

Keeping Your Home In A Chapter 7 Bankruptcy

The increase in exemptions available in New Jersey to protect the equity in your home has made it easier to keep your home in a Chapter 7 Bankruptcy. As of April 1, 2019 the exemption a home owner is allowed under federal exemptions, which are used in New Jersey, increased to $25,150.00 per home owner. For example, if you and your spouse own a home in, say, Cherry Hill, NJ or Voorhees, NJ and the home is worth $200,000.00 and there is a mortgage of $130,000.00 you would be able to file a chapter 7 and keep your home as long as you are able to continue making your mortgage payments and as long as you meet the other chapter 7 eligibility requirements such as those relating to income. That is because there would be no reason for a trustee to sell your home since there would be no benefit to your creditors. If a trustee sold the home in this example, the trustee would have realtor and other fees of about $20,000.00, the mortgage of $130,000.00 and you and your spouse could protect from creditors a total of $50,300.00. Consequently, if you are in need of a bankruptcy but are concerned you will lose your home, you should immediately consult with an experienced bankruptcy attorney

Exceptions to the Bankruptcy Automatic Stay

As a general rule when a bankruptcy is filed the commencement or continuation of lawsuits or collection matters against the debtor are automatically stopped. However, there are exceptions where the matter can continue. For example, a criminal action is not stopped by a bankruptcy. Nor is a suit to establish paternity, establish support or establish visitation. Audits by the IRS or a demand for tax returns are also not stayed. However the government entity is stopped from collecting the debt while the debtor is in bankruptcy. The automatic stay that takes effect when a bankruptcy is filed stops most kinds of legal actions against the debtor, but keep in mind that it does not stop all of them.

Can you bounce back after bankruptcy?

Filing for bankruptcy may seem scary, but it can actually be very helpful for people facing serious financial issues. Filing bankruptcy helps people in many ways, but the aftermath still can sting a bit. You might wonder what will happen after you file. How do you start to rebuild?

Fortunately, there are many tips you can use to get back on your feet after filing bankruptcy.

2019 planned store closing already outnumber 2018

2018 saw Toys R Us, Wet Seal and The Limited close all their retail locations, while Kmart, Walgreens, Best Buy, Foot Locker and more each closed hundreds of stores.

That trend continues in 2019, and at an even faster clip, according to “The New York Times.”


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