Bankruptcy Law Network Top 100 Blawg

American Bar Association Journal editors voted the Bankruptcy Law Network Top 100 Blawg for 2008.  Our own Jill A. Michaux is one of 25 lawyers who blog on consumer bankruptcy topics for Bankruptcy Law Network, the most comprehensive online source for consumer bankruptcy information.

BLN authors also write for its sister sites:  Mortgage Law Network, Credit Law Network and Debt Law Network.

GAP Insurance Not In Car Lender's PMSI

GAP insurance, service contracts, administrative fees and the traded-in car payoff are not part of a car lender’s purchase-money secured claim in chapter 13 bankruptcy and can be crammed-down if the car is worth less than the loan balance, Judge Janice Miller Karlin ruled this week in In Re Miller, Case No. 08-40935, (Bankr. D.Kan. December 2, 2008).

Judge Karlin suggested the ruling may be different for service contracts in a future case if the creditor convinces her the contract enhances the value of the vehicle.  Creditors have the burden of proof to establish their purchase money security interest (PMSI) claim, she said.

Non-PMSI charges are still part of the creditor’s secured claim and must be paid in chapter 13 bankruptcy up to the value of the car. A debtor must pay the entire PMSI to retain a car even if the amount is greater than the car’s value if the loan was incurred within 910 days of bankruptcy. [Read more…]

Courts Launch Bankruptcy Videos

The federal bankruptcy courts rolled out short web videos on basic bankruptcy topics for consumers considering filing bankruptcy.

The first video explains that bankruptcy is a legal process for individuals who cannot pay their debts, which stops debt collection and discharges the debts.

All eight videos can be viewed on bankruptcykansas.info or the courts website.

Consider Chapter 13

Considerchapter13.com is a new web site launched by the National Association of Chapter 13 Trustees Academy for Consumer Bankruptcy Education. The site contains information for consumers and bankruptcy attorneys by the Chapter 13 trustees who belong to the NACTT.

As always with any information on the internet, you should ask questions and discuss specific issues with your own bankruptcy attorney.  Chapter 13 bankruptcy practice varies widely from trustee to trustee and judge to judge around the country.

New Mortgage Payment Rule Clarified

New Standing Rule 08-01 for ongoing mortgage payments through the 13 trustee in Kansas applies to all chapter 13 banrkuptcy cases filed on or after October 1, 2008.  Debtors in cases filed earlier will not be subjected to the new rule even if they subsequently become delinquent on their home mortgage payments.

The Hon. Janice Miller Karlin, U.S. Bankruptcy Judge for the District of Kansas, Topeka Division, issued the following statement last week after polling all the Kansas bankruptcy judges: [Read more…]

New Address for KCK Chapter 13 Payments

Effective October 1, 2008, all chapter 13 payments to William H. Griffin Trustee must be mailed to PO Box 613106, Memphis TN 38101.

Payments to Griffin, the standing chapter 13 bankruptcy trustee for cases filed in Kansas City, Kansas, will no longer be accepted in person at Griffin’s office in Fairway, at meetings of creditors or at court hearings.  All payments must be mailed to the Memphis lock box.

Griffin is not moving his office.  He is changing banks to Suntrust Bank.


Topeka Debtors Allowed Means Test Deduction for Cars With No Liens

EDITOR UPDATE:  This post is out of date.  Judge Karlin reverted to her original ruling in In re Law after the Pearson decision was vacated.  This issue is currently pending the the U.S. Court for the Tenth Circuit  so we should have a binding ruling soon.  December 13, 2009.

Topeka Bankruptcy Judge Janice Miller Karlin announced last week that she is reversing course and will follow the Pearson decision to allow debtors a means test deduction for ownership of a car without a debt against it.

Judge Karlin had earlier disallowed the car ownership deduction in In re Law, 2008 WL 1867971 (Bankr. D. Kan. 2008), following the decision by Kansas District Court Judge John W. Lungstrum in Wieland v. Thomas, 382 B.R. 793 (D. Kan. March 4, 2008), reversing Judge Robert D. Berger of Kansas City, KS, in In re Thomas, 2007 WL 2903201 (Bankr. D. Kan. Oct. 02, 2007). [Read more…]

10% Home Mortgages Under Water

Here is a scary statistic for 2007 being reported by ABC News: 10% of American homeowners owe more money on their house than the house is worth. That figure has doubled from 5% in 2006.

For homes purchased in the past two years, the figure shoots up to an alarming 30%, according to Reuters. These are the highest numbers of homes under water since the Great Depression of 1929.

Eight million families are in danger of losing their homes due to mortgages that are greater than the value of the homes. See what fellow blogger, Gene Melchionne, has to say on the Mortgage Law Network about what this means for all Americans, particularly retirement funds.

Wichita Car Dealer Convicted of Bankruptcy Fraud – Facing 5 Years in Jail

A Wichita car dealer who gave money to relatives before filing his bankruptcy case and lied on his bankruptcy paperwork was convicted of federal crimes this week and faces possible jail time for his fraud.

Evidence at trial proved he gave money to his wife and his brother prior to filing his bankruptcy case and he lied on his paperwork. He falsely said he had no bank accounts and he had made no transfers of money to relatives nor closed any bank accounts. He also charged $125,000 on credit cards within a year of filing the bankruptcy petition for airline tickets, jewelry and other goods. [Read more…]

Kansas Bankruptcy Judges End Secret Mortgage Fees in Chapter 13

The bankruptcy judges in Kansas have approved new language for all chapter 13 confirmation orders that will put an end to the abusive practice of secretly adding fees to a debtor’s mortgage loan balance.

No real estate creditor shall ever assess, charge or collect, from either the debtor or the real estate collateral, any assessments, fees, costs, expenses or any other monetary amounts, exclusive of principal, interest, taxes and insurance, that arose from the date of the filing of the bankruptcy petition to the entry of the Order of Discharge except as may be allowed by court order or an allowed proof of claim.

[Read more…]

Attorney General Six Gives Foreclosure Advice – Get Attorney, Learn Options

Kansas Attorney General Stephen N. Six issued the following statement on home mortgage foreclosure this week, urging people facing foreclosure to seek help from an attorney.

Home foreclosure is a growing problem in Kansas and across the nation. Mortgage fraud and subprime lending have left many homeowners stuck with home loans they can no longer afford.

My office recently convened a task force to investigate this problem. Consumer advocates met with representatives from lending and real estate industries to determine ways we can stem the tide of home foreclosure in Kansas. [Read more…]

Board Certification Renewed for Jill Michaux

ABCJill Michaux has earned recertification in consumer bankruptcy law by the American Board of Certification. She was awarded her 15 year pin as a consumer bankruptcy specialist.

She was the first Kansas lawyer to be board certified in consumer bankruptcy law. Her partner, Mark Neis, was second. Today, they are the only board certified consumer bankruptcy specialists in Topeka and two of ten in Kansas.

Board certification means that Jill has met rigorous, objective standards and has demonstrated expertise in consumer bankruptcy law. She goes the extra mile to keep current on bankruptcy law changes by attending national seminars, participating in daily e-mail updates and by attending several times the hours of continuing legal education required by Kansas.

You expect certification from your doctor – expect it from your lawyer too. Hiring an attorney with expertise in any specialized field of law, such as bankruptcy, can be a bewildering experience. As a client, you want to make sure your attorney is experienced in consumer bankruptcy law. Choosing a board certified specialist in one way to make sure.

Can't Add Your Spouse to Your Individual Bankruptcy Case Later

Your spouse does not have to file bankruptcy with you in Kansas, but make sure you don’t want to file a joint case, because you can’t add your spouse to the case later.

Judge Dale L. Somers denied an attempt by a debtor to add her spouse two months after she filed her case by amending her petition filed with the Court. In Re Cheryl R. Daly, 07-22628-13, (Bankr. D.Kan. 01-28-2007).

It would be possible for the nonfiling spouse to file his own case and then consolidate the two cases for administration.

More Kansans Can Qualify for Bankruptcy Help with Increased Income Allowances

The Kansas income guidelines for the bankruptcy means test go up February 1, 2008.

Kansas Median Family Income by Family Size for Bankruptcy Cases Filed on or After February 1, 2008,

  • 1 earner……….$38,594
  • 2 persons……..$52,989
  • 3 persons …….$58,075
  • 4 persons …….$69, 831
  • 5 persons …….$76,731
  • 6 persons …….$83,631
  • Add $6,900 for each additional individual

Wieland Named U.S. Trustee for Kansas

Richard Wieland

Richard Wieland

Richard A. Wieland has been named U.S. Trustee for Region 20, which covers Kansas, Oklahoma and New Mexico.

Wieland has been serving as acting Region 20 U.S. Trustee since September 1, 2007. He is familiar to the Kansas bankruptcy bar, having been a trial lawyer in the Wichita office since 1988. When the Bankruptcy Abuse Prevention and Consumer Protection Act was enacted in 2005, he played a pivotal role in implementing the consumer credit counseling and debtor financial management education requirements for the Executive Office of the U.S. Trustee in Washington, D.C

The U.S. Trustee program is charged with overseeing bankruptcy case administration. Region 20 offices are headquartered in Wichita with additional offices in Oklahoma City, Tulsa and Albuquerque.

Here is a link to the official EOUST press release.

1923 Disney Bankruptcy in Kansas City

Did you know Walt Disney’s Missouri company, Laugh O Gram Films, Inc., was forced into bankruptcy in Kansas City on October 4, 1923? Fellow blogger, Rachel Foley of www.kcbankruptcy.com, and lover of all things Disney, proudly displays the bankruptcy documents in her office.

As Rachel says, “Walt went into bankruptcy with Oswald the Lucky Rabbit and came out the other side with Mickey Mouse.”