What New Bankruptcy Lawyers Need To Know: Beyond The Code

10 Ways The Practice Of Bankruptcy Law Has Changed In 30 Years

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Doesn't every elder's story about the past begin, "When I was your age..."? It's not the age of your body but the age of your bankruptcy practice and the state of the practice in general that interests me today. I literally fell into bankruptcy law; the lawyer in the office next to mine not only offered me a bankruptcy case (when I had few cases ) but offered to teach me how to handle it. That … [Continue reading...]

Are You The Calculating Type?

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

I get a surprising number of questions about objecting to claims in a bankruptcy case: how? when? Too few bankruptcy attorneys are asking "why?" The answer to the "why" question must be that objecting to the claim furthers the client's objectives or prevents a negative outcome. Put another way, the cost of objecting must be relative to the benefit to be received. You must … [Continue reading...]

Labor Day Feel Like New Years?

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Over at MoneyHealthCentral, where Jay and I write for consumers about money , I did a piece this morning on how Labor Day marks a transition in my mind about the year. It provokes resolutions about how life shall be going forward. The transition is largely in my head these days. My boys no longer live at home, I don't have "first day of school" responsibilities any more, and September in the … [Continue reading...]

Lien Stripping in Chapter 20

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

A debtor's right to strip off a wholly unsecured lien is not dependent on the debtor's eligibility for a discharge, says the 8th Circuit BAP. Hurray for Chapter 20. Before 2005, a debtor was entitled to file Chapter 13 immediately following a Chapter 7 and address whatever debts had survived the 7. The 7 + 13 approach was nicknamed Chapter 20. With BAPCPA came the … [Continue reading...]

Family, Friends And Chapter 13

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

The drafters of the 1978 Bankruptcy Code knew something about the lives of real people and some of the generally accepted people practices. They included two priceless provisions that allow debtors to protect co obligors with the debtor through the Chapter 13 plan. Co debtor Stay How often have our clients drawn on family or friends to co sign a loan? If filing bankruptcy results in … [Continue reading...]

Include Me Not

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Proposed: the word "included" shall be stricken from the vocabulary of any bankruptcy lawyer. A relatively innocent question from a young lawyer set me off (again). The car, driven and paid for by an offspring, was titled to the prospective debtor who was the only borrower on the loan. The lawyer asked how to avoid "including" the car in the bankruptcy. The client didn't want to entangle the … [Continue reading...]

The Chapter 13 Plan Light Bulb Moment

By Cathy Moran, Esq. Filed Under: Chapter 13

Do I have to cure the arrears on the car loan and pay off the claim secured by the car, came the email from the young bankruptcy lawyer. No: when you pay the claim in a Chapter 13 plan, the arrears on a car loan are not a separate element for payment. I knew the practical answer, but as I formulated a written answer, the light bulb went on as to why that was so. Don't mix … [Continue reading...]

How To Learn The Truth Behind The Asset

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

When credit is a commodity, family are friends, and creditors are not, strange things happen. Trouble is, our clients don't think the happenings are strange. Bankruptcy lawyers end up moving lots of "stuff" to get to the real story. Street law Arkansas bankruptcy lawyer Kathy Cruz uses the marvelous phrase "generally accepted people practices" to describe the kinds of transactions … [Continue reading...]

Four Ways Around The Chapter 13 Debt Limit

By Cathy Moran, Esq. Filed Under: Chapter 13

Retreating property values strand would be Chapter 13 debtors

Bankruptcy needs a higher debt limit, too. My topic at the Bar Association of San Francisco in late July was all of a piece with the national problems: our debt ceiling was too low. Of course, I was addressing the debt limits in Chapter 13. An increase of a few hundred thousand would have solved my problems. Historically the concept of limiting access to Chapter … [Continue reading...]

Bankruptcy Relief And Something For Nothing

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

This rant is for clients, and for bankruptcy lawyers who have to "adjust" the expectations of clients. The trigger was an attorney who asked if he could file a Chapter 13, strip a lien, and then convert the case to Chapter 7, preserving the lien strip. No, I said, why do you ask? The client was resistant to committing to a multi-year plan that might require increased payments if his income … [Continue reading...]

A Bankruptcy Lawyer’s Work Is Never Done

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Your job isn't done at confirmation of a Chapter 13 plan. Our clients' lives keep changing, and if you keep thinking, there are on going chances to further improve their lives. Too often the changes in our clients' circumstances are negative and we are looking at cratered cases, conversions or hardship discharges. But this week, changes with a negative tinge held a happier outcome. It played … [Continue reading...]

Good Bankruptcy Lawyers Let It All Hang Out

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

Which bankruptcy schedule does this go on? Can't tell you how many questions I field about where on the official bankruptcy forms to schedule some asset. Is the timeshare real property or personal property? What do you do with the claim, the chose in action, the car titled to debtor but paid for by someone else. I have a secret to share. It doesn't matter. That is, it matters naught … [Continue reading...]

Lien Stripping And Dueling Appraisers

By Cathy Moran, Esq. Filed Under: Bankruptcy Practice

When the appraisals clash, and the fate of a junior lien of thousands of dollars is at stake, what's a judge to do? Crunch the numbers himself is how one judge came to a decision when the experts didn't agree. In Duarte, the debtor's appraiser testified that the house was worth $370,000 based on comparables including three bank-owned sales. The junior lien holder's appraiser came in at … [Continue reading...]

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