Bankruptcy Chapters

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Maine Consumer Protection under Bankruptcy Chapters

Chapter 7 bankruptcy:  

is a 90-120 day process that discharges most debts. It is primarily used to eliminate credit card, medical, and utility debts and personal loans. Most property can be protected during this process. The average cost at my office is $1,350 plus $306 filing fee and $50 credit counseling fees.

Chapter 13 Bankruptcy:

Chapter 13 is a 3-5 year repayment plan, in which you repay what you can afford to your creditors. It can also be used to eliminate second mortgages, repay income tax debt while eliminating most penalties and freezing interest, or “cram down” debt to the value on many cars or business equipment. Some people use it to protect property that can’t be protected in Chapter 7. The average up front cost at my office (there are additional fees paid through the plan) is $1,350 plus $281 filing fee plus $50 credit counseling fees

Chapter 11  Bankruptcy:

Chapter 11 bankruptcy is similar to Chapter 13 in that you repay what you can afford over 3-5 years. Unlike Chapter 13, it is available to people with more than $360,475 unsecured debt and to businesses seeking to reorganize.

Chapter 12  Bankruptcy:

Chapter 12 is available to family farmers and fisherman. It offers greater benefits that Chapter 13. Particularly, it allows people to modify their loans by changing terms and potentially stretching out their repayment. Critical changes have occurred in Maine law advantageous to fishermen and farmers since this firm successfully pushed for changes to the law in 2014. See Chapter 12

Debt Settlement:

A Common alternative to bankruptcy is debt settlement. Beware of debt settlement companies! Most offer an attractive monthly payment, but do little or no work until their fees (around 15% of the total debt) are paid. In the meantime, creditors continue calling, charging interest, and often file lawsuits! We accept lump sums in escrow, negotiate settlements (usually around 30-50%) and get the accounts closed quickly. However, any time debt is settled, you may get a 1099 for the amount forgiven, which the IRS considers income to you.

Foreclosure Defense – In Maine:

Homeowners have a right to mediation in foreclosure. We can use that as a vehicle to get a loan modification that might otherwise take a year or more to be approved. We often modify a first mortgage through mediation, then file Chapter 13 to eliminate a second mortgage or home equity loan.

Consumer Law Violations:

Whether you are in bankruptcy or dealing with a debt collector, there are laws protecting your rights. Often creditors and debt collectors violate those rights. We can determine if you have a claim for monetary damages and pursue that claim on your behalf, frequently at no cost to you.

Creditor Representation:

While I focus my practice on representing consumers, I also represent individuals who have claims against other people in bankruptcy. Just because someone files bankruptcy doesn’t mean an ex-spouse or wronged lender doesn’t have rights. However, there may be a very short time to take action to protect those rights.