Category Archives: Helping You Understand Bankruptcy

Filing bankruptcy: Eliminating medical bills

 

There are several options for filing bankruptcy and eliminating medical bills. When bad things happen to good people the financial consequences can be suffocating. Especially when it is not your fault, you should not have to be stuck with unpayable debt and non-stop collector harassment. Medical debt collectors may sue you and garnish your wages, creating additional anxiety and burden to anyone already struggling with money.

eliminating medical bills
Helping people get out of debt with dignity and respect for over 40 years.

You can make the phone calls and lawsuits stop when you file a petition for Chapter 7 or Chapter 13 bankruptcy. After your bankruptcy, there are great options to boost your credit and put yourself in the best place to make and keep more money and enjoy financial freedom.

How medical debt collectors seek money judgements and wage garnishments

Mary, a single mother of three was severely injured in a car crash that was not her fault. The other driver did not have insurance and had no assets. Mary was stuck paying for hospital and medical bills for her emergency care, surgery and rehabilitative care that over many months. Mary could have paid cash for a new home for money she owed in medical bills. The medical bill collectors hired a lawsuit and served Mary with a lawsuit and she was facing a potential wage garnishment. Luckily Mary’s employer kept her job for her when she was able to get back to work but Mary wanted to keep her pride and avoid the embarrassment of having her wages garnished and losing that much more out of her paycheck.

How bankruptcy stops medical debt collectors in their tracks with the Automatic Stay provision

One day, Mary accepted the reality that the accident and medical bills were not her fault. The freedom from harassment by collectors sounded like music to her ears. Having the lawsuit go away meant Mary would be able to sleep at night. When she filed for bankruptcy, Mary had the protection of the automatic stay provision in bankruptcy, which orders that all collection activity must stop during the bankruptcy.

Read our article for more: Examples of the Automatic Stay and how it operates in bankruptcy law.

Qualifying for Chapter 7 discharge or Chapter 13 bankruptcy reorganization

Mary had no idea there were options and more than one type of bankruptcy. She learned that Chapter 7 was the traditional bankruptcy she was looking for. Because she did not have too many assets or too high an income, she was able to qualify for the full discharge of all her debts allowed by the bankruptcy code. She also learned how she could have entered a Chapter 13 repayment plan and pay back a smaller portion of her medical bills over several years, which could have also helped her get back on track and stop the harassment and collection efforts.

Read our article for more: How is Chapter 7 different from Chapter 13 bankruptcy?

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

Podcast: October 2017 Chicago Bankruptcy Question and Answers with Joseph Wrobel

Joseph Wrobel is a Chicago Bankruptcy Attorney
Chicago Bankruptcy Attorney Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress.

Click/tap here to listen to this podcast interview anytime.

Sample questions answered in this 30-minute show:

  • How soon after filing bankruptcy can my divorce be finalized?
  • Can I file for bankruptcy to get rid of medical bills I cannot afford?
  • On Social Security Disability, can I have my bankruptcy fees and costs waived?
  • I am on the deed of my mother’s house and she is going to file bankruptcy, if she were to die, what would happen to the house?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

To buy or rent in Chicago, a few things to consider

While some people are only interested in owning their home, others are quite satisfied renting for the foreseeable future. As real estate and financial markets change we often see news stories with industry leaders telling us it is a good time to be selling a home or whether it is a good time to buy. Not everyone is in the position to buy a home and many are content with renting forever. While financial experts tell you that building equity in a home is the best way to be prepared for the future and retirement, there are plenty of alternative ways to save for the future and continue renting.

What are some of the barriers to buying a home if the conditions are right?

The first thing most people think about when buying a home is saving up to make a 20% down payment, however a good credit score may be the most frequent concern, especially for people who have struggled with job loss or financial difficulties. The good news on credit is that when you follow a few steps and practice smart credit your score will improve, often quicker than you realize. Read our blog article about credit repair for more information.

When it comes to money down, you might qualify for one of the programs for buyers backed by the government. There are veteran’s loans, FHA loans and similar programs where there is no down payment required. You must meet income criteria, which many easily satisfy.

Why some homeowners are jealous of their friends who rent their homes.

Taxes on homes in the Chicago area are a significant concern for homeowners. Over time, taxes increase and homeowners must follow procedures to challenge their tax rate. Meanwhile, renters aren’t worried about tax rates, and if they have been renting their home for some time, they may be paying significantly less than the current market rental rates.

Homeowners may be jealous of their renting friends who do not have to spend their extra time and money repairing hail damaged roofs, windows, air conditioners and so forth, on a seemingly endless list. Renters are also the envy of homeowners who get new neighbors that frustrate their living situation. It is not so easy to pick up and move, especially if the housing market is not in favor of sellers.

Saving money for the future without having equity in a home can be easy.

While the traditional plan for many was to pay off their house before they retire so they only must pay tax and not a mortgage, many people today elect to rent. The overall cost of home ownership versus renting can be a close equation. If while the homeowner spends money on repairing a roof, the renter puts that same amount of money in an investment, they may be in a good position to start and continue saving for the future.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

August 2017 Chicago Bankruptcy Question and Answer Podcast with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress. Click/tap here to listen to this podcast interview anytime.

Sample questions answered in this 30-minute show:

  • When can a bankruptcy be removed from my credit report?
  • Will I lose my US citizenship or be deported if I file for bankruptcy?
  • If you file for bankruptcy, is every credit card you have included?
  • Can another party collect from me in small claims court if I am in bankruptcy?
  • If I file for bankruptcy, can I keep my home and my car if I was never late on those?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

7 bankruptcy repercussions are myths not to worry about

While some people take advantage of bankruptcy laws to improve their lives and finances, others have a long list of excuses why they refuse to file for bankruptcy protection. While some of the concerns people have are reasonable, they are often blown way out of proportion by the people who do not want you to get a bankruptcy. Who are these naysayers? Largely the people who work in the business of debt consolidation will try to scare you with misconceptions about bankruptcy.

Here is a list of bankruptcy repercussions you were told about but will probably never experience:

  1. The bankruptcy trustee will take everything you own. Not true: There are state exemptions allowing you to keep your personal belongings, vehicle and equity in your home up to a certain dollar amount.
  1. Everyone in town will know about your bankruptcy. Not unless you tell them: Where in the past years bankruptcies were more difficult or less common they may have appeared in the newspaper. Nowadays and especially in a big city like Chicago, nobody will ever know unless you tell them.
  1. Your wife will leave you and take the kids. While it’s possible, it’s unlikely: The negative stigma that used to follow a bankruptcy many years ago is no longer an issue for so many people who likely know people who got a bankruptcy and are doing well and are financially successful after their bankruptcy.
  1. You won’t be able to keep your home or car. You have options: You may keep your car if its value falls within exemption limits or you can sign a reaffirmation agreement to keep the car and make payments on it despite the bankruptcy. Keeping your home may be equally feasible through a Chapter 7 discharge or Chapter 13 reorganization bankruptcy case.
  1. The boss will surely fire you when they find out. Your boss has no reason to know: Unless you tell your boss that you need a day off work to attend your initial bankruptcy hearing, they have no reason to know about it. In fact, many people file for bankruptcy to prevent their boss from knowing about a wage garnishment, something they can avoid if they file bankruptcy.
  1. You won’t be able to rent an apartment. Not true: Even people with the most concerning financial track records are able to rent an apartment, and the only difference may be an extra month’s worth of a security deposit required by the landlord.
  1. You will never be able to get credit again. Biggest misconception: The moment your former debts are wiped away in bankruptcy, you have more spending power and a better ability to pay your bills. Not long after a bankruptcy you can get a secured credit card and start rebuilding your credit, focusing on your current and future credit while forgetting about the past.

If you want to learn the real expectations you should have when considering a bankruptcy filing, contact Joseph Wrobel, Limited to learn bankruptcy is like in the present day.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

July 2017 Chicago Bankruptcy Question and Answer Podcast with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress. Click/tap here to listen to this podcast interview anytime.

Sample questions answered in this 30-minute show:

  • Can you, and when should you include a title loan in your bankruptcy filing?
  • If you owe money to a business that files bankruptcy, do you still need to pay?
  • When you need to file bankruptcy and get a new car, what is the best plan?
  • What does someone need to do to prepare for a bankruptcy case?
  • Are Social Security and pensions safe from creditors when you file for bankruptcy?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

New Credit Reporting Rules: Many may find relief from reports of tax liens and civil judgments

New rules provide credit score relief for some people who have tax liens and civil money judgments against them. Errors on consumer credit reports have been a problem for a long time and many people have incorrect information on their credit reports. New credit reporting rules take effect July 1 and change the way Trans Union, Experian and Equifax verify data regarding the reporting of tax liens and civil judgments. Now, the three credit reporting agencies must verify the individual’s name, address and either social security number or date of birth. Since so many companies omit social security numbers for privacy concerns, there may be a large group of people who will no longer have tax liens and civil judgements appearing on their credit reports. This should also help prevent future instances of information appearing on the wrong person’s credit report.

The purpose of credit reporting and monitoring

From applying for a cell phone account or utility to buying a car or home, our credit rating is used to determine where we stand on the scale of credit risk. With great credit, we present a low risk of not making our payments in full and on time. The volume of credit data and computer systems processing and sharing information open the door to error. If we do not check our credit scores frequently, someone else’s negative information could prevent you from being accepted for a mortgage loan or a new credit card. Imagine finding out your credit score was damaged by another person’s tax lien or the civil judgement entered against them.

How errors happen and how prevalent they may be

With tax liens alone, some estimates suggest that half of the tax lien information reported to the credit bureaus has ended up appearing on the wrong person’s credit report. When social security numbers are available to the individuals reporting tax liens, one missed number could cause the wrong person to receive a negative mark on their credit report.

Even if someone checks their credit frequently, or pays a few bucks every month for a credit monitoring service, the effort it can take to correct the mistake can be staggering.

How the new rules apply to tax liens and civil judgments

The rule change for reporting information to the credit bureaus about tax liens and civil judgements will require the verification of three pieces of vital information, the individual’s name, address, and either their social security number or date of birth.

By requiring three sets of identifying criteria be matched before receiving credit reporting data about tax liens and civil judgments, the likelihood of mismatches is significantly reduced.

The new rules take effect July 1. This article in USA Today has more information about the new rules and how they might apply to you.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

Mortgage loan options after bankruptcy

There are several types of mortgages available in to home buyers after a bankruptcy discharge. After a bankruptcy discharge under Chapter 7 or Chapter 13 you may be able to qualify for a mortgage sooner than you think. When your debt to income ratio is better after discharging some or all debts, you may be a better lending risk when you have more disposable income to save money and pay bills. After your bankruptcy discharge you have some time to work on re-establishing your credit and saving money for down payments and closing costs. When you are ready to start shopping for a mortgage there are several options to consider depending on your personal situation and home ownership goals.

How long will I have to wait?

There are two types of bankruptcy, Chapter 7 (full discharge) and Chapter 13 (partial discharge and reorganization). Many people with Chapter 13 bankruptcies are approved for government-backed mortgages after one year or they could be approved for a conventional mortgage loan after two years. The Chapter 7 bankruptcy filers may have to wait three or four years after their discharge to be approved for a new mortgage.

Some people chose to take at least two years or more to rebuild their credit using secured credit cards and small loans, while also saving cash for the expenses involved in putting money down and closing on a new home. The longer you wait, the better interest rate you may get. This is not always true however because interest rates fluctuate.

Conventional and government-insured loans

The difference between conventional loans and those insured by the U.S. Government is the financial guarantee for the lender, in case the individual fails to pay the mortgage. Conventional loans are not guaranteed by the federal government, and because they are not secured, the buyer must have better finances.

The common government-insured mortgage loans are the FHA loans, VA loans and USDA loans:

  • FHA loans backed by the Federal Housing Administration allow participants to make down payments as low as 3.5%. Purchasers will be required to pay for mortgage insurance which increases monthly payments;
  • VA loans secured by the U.S. Department of Veterans Affairs help military service members and their families buy homes with 100% financing meaning the purchaser only needs to pay the closing costs.
  • USDA loans are insured by the U.S. Department of Agriculture and benefit rural buyers who satisfy income requirements including a steady middle class income who otherwise may not qualify for conventional loans.

Adjustable vs fixed-rate mortgages

If you are approved for a fixed-rate mortgage when interest rates are low you will be locked in at that low mortgage rate for the entire term of the loan and your monthly payment will not change. The other type of loan is an adjustable-rate mortgage loan (ARMs) which have interest rates that change from time to time based on interest rates. Some ARMs provide fixed rates for several years after which time the rate is subject to adjustment based on the rates at the future date. If interest rates are high on mortgages when you are applying, you might want an ARM so that you can try to lock in a better rate when the rates go down. You always have the opportunity to refinance your loan and select a fixed-rate mortgage after having an ARM for some time.

For more information about applying for mortgages after a bankruptcy, please call Joseph Wrobel, Ltd.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

May 2017 Chicago Bankruptcy Question and Answer Podcast with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress. Click/tap here to listen to this podcast interview anytime.

Sample questions answered in this 30-minute show:

  • Can the Chapter 7 Bankruptcy Trustee take my IRS refund?
  • Will a prior credit counseling certificate work for my new bankruptcy?
  • How long can a creditor in Illinois file a lawsuit against you?
  • Am I responsible for my wife’s credit card debt?
  • Is it possible to vacate a dismissed bankruptcy?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

Using credit cards and boosting your credit score after bankruptcy

 

After a bankruptcy discharge of those pesky debts you don’t miss, your available cash flow is increased and you should have more spending power. Your credit score is a function of several variables, not a mean person sitting in judgment of you. As you have more cash flow and spending ability, the decision to extend credit to you is easier because you are more likely to pay the bills when you can afford to. Once you get new credit cards there are a few things you should do to maximize your opportunity to boost your credit score.

Your credit score is determined by a variety of financial factors:

  • Credit card utilization
  • Payment history
  • Derogatory marks
  • Age of credit history
  • Total accounts
  • Hard inquiries

When you use credit cards and are working on boosting your credit score to qualify for a new home, many credit advisors will tell you to use your credit cards but not more than 30 or 40 percent of the available credit rating. It’s a good idea to pay your fixed expenses such as phone or internet with the credit card. Since you know you must pay that bill anyways, why not build your credit?

The next step with the credit cards is setting up automatic minimum monthly payments to be made by your debit card or checking account so you never have to worry about a late payment. When you pay your bill, which is easy to do now on apps on your phone, do not pay the entire balance. It is better to leave a few dollars on your balance so that it appears you are actively using the card – once a month the credit cards send a report to the credit bureaus and if your balance is zero it may look like you are not using the card and that can damage your credit score.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!