Philadelphia 's Hahnemann Hospital and Saint Christopher's Hospital for Children were part of a health care conglomerate that filed for bankruptcy on July 1, 2019. On September 23, 2019 the bankruptcy court in Wilmington DE approved the sale of Saint Christopher's Hospital for Children for 50 million dollars. https://www.google.com/amp/s/www.bizjournals.com/philadelphia/news/2019/09/23/st-christophers-50m-sale-wins-ok-from-bankruptcy.amp.html The sale will allow most of the employees to stay employed and allow the renown children's hospital, which has been in existence for over 100 years, to continue. The sale also includes the sale of specialty care physician practices including practices in Northeast Philadelphia, Pennsylvania and Washington Township, New Jersey. https://www.google.com/amp/s/www.bizjournals.com/philadelphia/news/2019/09/23/st-christophers-50m-sale-wins-ok-from-bankruptcy.amp.html
Whether I am in my office in Willingboro New Jersey or in Northeast Philadelphia I often hear the same statement when a client comes in to file a Chapter 7 bankruptcy- "I don't want to include my car in the bankruptcy ". While keeping a car is generally not a problem, the car is required to be included in the bankruptcy since a debtor is required to list everything owned and all debts, including car loans. However, in addition to listing the car, a Statement of Intentions regarding the car must also be filed. In it the debtor states whether they intend to surrender the vehicle, reaffirm the debt on the vehicle, or redeem the vehicle. Reaffirm means a form is completed and filed with the court which has the effect of taking the car out of the bankruptcy. The good part is it helps rebuild credit. The bad part is if you default and the car is repossessed you will be liable for any deficiency claim. Redemption is when you have a car worth, for example, $10,000.00 and you owe $15,000 there are companies that will lend you the $10,000 and you are basically saying if I gave you the car back you would only get $10,000 even though I owe you $15,000 so I am giving you $10,000 and that is what you get. The bottom line is keeping your car in a bankruptcy is generally not a problem.
Let's say you have a home in Northeast Philadelphia Pennsylvania and a vacation home in Margate New Jersey or a commercial property in Cherry Hill New Jersey. Should you file in Philadelphia Pennsylvania or can you file in New Jersey as well. 28 USC section 1408 says you can file where your domicile is located or where you reside or where your principal assets are located. So the answer can be either state, depending on circumstances. While the basic bankruptcy law is the same, there are differences in how certain sections are interpreted so it makes sense to consult an experienced Bankruptcy attorney to see what is best in your particular circumstances
Whether you are from Pennsauken NJ or Cherry Hill New Jersey or Northeast Philadelphia Pennsylvania, individuals often come into my office and ask the same question. Am I eligible to file bankruptcy? Most times individuals are eligible to file bankruptcy. There are some limits. For example, section 109 of the bankruptcy code provides that to file a chapter 13 bankruptcy you cannot have more than $394,725.00 in unsecured debt or more than $1,184,200.00 in secured debt. If you do, you cannot file chapter 13, but you can file an individual chapter 11. Sometimes the real question is can they receive a discharge. For example, if an individual has filed a chapter 7 bankruptcy within the last 4 years, they are not eligible to receive a discharge in a chapter 13. However, that does not prevent the individual from filing a chapter 13. If they are behind with their mortgage, a chapter 13 can be used to pay mortgage arrears over 3 to 5 years even if they are not eligible for a discharge. Regarding chapter 7, a discharge will not be received if a chapter 7 is filed within 8 years of a prior chapter 7. In addition, the ability to file a chapter 7 and receive a discharge may be effected by other factors such as income compared to expenses. If an individual has too much disposable income, they could be forced to convert to chapter 7 or have their case dismissed. Equity in assets is also a factor in determining whether someone should file a chapter 7 or chapter 13 bankruptcy. Whether bankruptcy is an option and which type of bankruptcy are important issues that should be discussed with an experienced attorney before deciding how to proceed.
ELIGIBILITY FOR A CHAPTER 13 BANKRUPTCY
Issues can arise when your landlord files bankruptcy such as what happened when a Northeast Philadelphia owner of multiple properties filed bankruptcy. http://www.philadelinquency.com/2015/12/31/what-do-you-do-when-your-landlord-is-bankrupt/ Generally, if the landlord filed a chapter 7 bankruptcy and is no longer going to operate the apartment building and you move, there may be an issue relating to getting your security deposit back. The landlord should have put the money in a separate account which would protect your money from the landlord's other creditors. However, all too often, the money is not segregated. In that event, it is less likely that you will get your deposit back. However, all is not lost. A deposit creditor is given a higher priority then general unsecured creditors so even if the landlord does not have enough assets to result in full payment to creditors, the tenant is ahead of a lot of creditors with any distribution. Of course if there are no funds, then the deposit is lost.
The type of bankruptcy initially filed where a discharge is received is a determining factor in the number of years that must pass before a debtor can refile for bankruptcy and again receive a discharge. Whether living in towns such as Moorestown, New Jersey or Northeast Philadelphia, Pennsylvania the rules relating to obtaining a bankruptcy discharge in a second bankruptcy are the same.
The bankruptcy means test is a significant factor in determining who can file for debt forgiveness through Chapter 7 bankruptcy. See http://www.csmonitor.com/Business/Saving-Money/2016/0718/Why-the-bankruptcy-means-test-matters. It takes into account your income, expenses and family size as well as the state you live in to determine whether you can eliminate the debt or whether you have enough disposable income to repay some or all of your debts. Regarding the relevance of the state you live in, as an example, a family of four residing in Northeast Philadelphia Pennsylvania will need to have less income than a family of four residing in Pennsauken New Jersey because the statewide income is less in Pennsylvania then in New Jersey.
As previously discussed in my Blog at bravermanlaw.com in certain hardship cases student loans can be eliminated. However, what about those circumstances where the student loan cannot be eliminated. Is there anything that can be done in bankruptcy that can help with limiting the student loan payments? The answer is yes. A Chapter 13 can be used to provide some relief. Chapter 13 is a form of bankruptcy where payments are made over a period of 3 to 5 years. It is often used to pay mortgage arrears over 5 years to allow the borrower to save their home. However, what about a situation where someone has unsecured debt, such as $20,000.00 in credit cards, and $80,000.00 in student loans, the student loan lender is demanding $600.00 per month and your salary cannot yet support that kind of payment. One option would be to file chapter 7 personal bankruptcy which would eliminate the credit cards but not help with the student loan payment. Another option is to file Chapter 13. Lets say you live in Northeast Philadelphia, your budget, when you don't count the student loans or the credit cards, would allow you to pay $200 per month for 5 years. In the Chapter 13, you stop paying all of the creditors and you pay $200.00 per month to the trustee which would total $12,000.00. After certain trustee deductions, your creditors, totaling $100,000.00 ($20,000.00 credit cards and $80,000.00 student loans) would share about $10,000 or roughly 10% of their claim. At the end of 5 years, the other 90% owed to the credit cards would be eliminated. As for the student loan, once the bankruptcy is over, you would then be obligated to continue making payments on the student loan. However, you will have made a manageable payment for 5 years with the hope that you are now in a better position to pay the student loan.