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THE CONSUMER BANKRUPTCY LETTER
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In This Issue:
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Dec. 15, 2003
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FEATURED BOOK: King's Discharging Taxes
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BAD FAITH CHAPTER 7 DISMISSED
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FEWER MORTGAGE DELINQUENCIES
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U.S. TRUSTEE PROPOSES DRASTIC RULES CHANGES
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REFORM ACT MAY HAVE ELECTION TROUBLE
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The One-Stop site for Consumer Bankruptcy Lawyers
Books / Software / Periodicals
FEATURED -
King's DISCHARGING TAXES IN BANKRUPTCY ed. 2000
5th ed. • 915 pages • 75 exhibits and checklists • over 1,000 cases cited • indexed $95 - 2002 Supplement available
This book has been called "the bible" for discharging taxes in consumer bankruptcy cases. Used by thousands of lawyers, trustees, judges and other tax professionals across the country, it explains in simple yet comprehensive terms what kinds of taxes can be erased, when they can be erased, and how they can be erased in chapter 7, 13, or 11. It covers all the issues and traps for the unwary. This book is even used by revenue officers!
Says Ike Shulman, former President of the National Association of Consumer Bankruptcy Attorneys, "Every serious bankruptcy practitioner should have this book!"
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OTHER POPULAR TITLES -
King, Discharging Taxes in Bankruptcy with 2002 supplement $135
King, Marketing A Consumer Bankruptcy Practice $89
King, Chapter 7 Law & Practice $129.50
King, Chaper 13 Law & Practice $129.50
King, Fees & Ethics in Consumer Bankruptcy Cases $79.95
NCLC, Consumer Bankruptcy Law & Practice $140
James Pub, Bankruptcy Courts & Procedures $110
Aspen, Basic Bankruptcy Law For Paralegals $79.95
Aspen, Automatic Stay Litigation $195
Juris, Fundamentals of Bankruptcy & Corporate Reorganization $80.75
CD TimeValue, TValue5 Interest Calculator $149.00
CD Gold, Tax Discharge Chronometer $139.00
CD Collier TopForm Bankruptcy System $700
OVER 100 SELECTIONS TO CHOOSE FROM
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WASHINGTON, Dec. 9 — Fewer homeowners were behind on their mortgages payments in the last quarter as an improving economy helped to take pressure off household budgets.
THE SEASONALLY ADJUSTED percentage of mortgage payments 30 or more days past due for all home loans dipped to a three-year low of 4.28 percent in the July-to-September quarter, down sharply from 4.62 percent in the previous quarter, the Mortgage Bankers Association of America reported Tuesday in its quarterly survey. The survey covers roughly 35 million mortgage loans.
The third quarter’s delinquency rate was the lowest since a rate of 3.98 percent registered in the third quarter of 2000, the association said. The economy grew at a blistering 8.2 percent annual rate in the third quarter, the strongest performance in nearly two decades.
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COUPLE AWARDED $940,000 FOR CREDIT REPORT MISTAKES
Dec. 8, 2003 - a federal jury has awarded a Fresno, California couple $940,000 against Trans Union, LLC, a Chicago-based credit corporation after the agency failed to correct mistakes on their credit report. The award was brought under the Federal Fair Credit Reporting Act.
The issue arose over certain IRS tax liens inadvertently asserted against the plaintiffs. The IRS took steps to remove the iiens, but the plaintiffs, Raffi and Deborah Garabedian, testifed they tried for years in vain to force Trans Union to delete them from their credit report. Other errors on the credit reports were also alleged.
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CHAPTER 7 DISMISSED FOR BAD FAITH WHEN ADJUSTED BUDGET COULD PAY 40.07% ON UNSECURED DEBT
In this case, the Debtor's projected expenses, at a minimum, provide a very comfortable lifestyle. The Debtor's schedules show $502.00 per month for transportation. Upon questioning, the Debtor's were unable to account for $300.00 of the amount. Further, the Debtor's included a $306.00 monthly charge for telephone service. These charges included home telephone, mobile phones for both Debtors, and a mobile phone for the Debtors' 14 year-old child. Under the Utilities section of Schedule J, the Debtor's include a $143.00 monthly charge for television cable service, trash disposal service, TWO digital television recording, and internet service. Also, the Debtor's include $400.00 per month for recreation, clubs and entertainment, newspapers, magazines, etc, and $175.00 per month for fingernail and hair care.
In re Fergason, (S.D.Tex. 2003)
COMMENT: It is unclear in this opinion whether the "majority" of the debtors' debts were "consumer" debts within the meaning of 11 U.S.C. § 707(b); an argument can be made that over 50% of the debts were priority income tax liabilities, which are typically not deemed consumer debts. If the majority of debts was not consumer debt, then § 707(b) should not apply.
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ERISA PLAN THAT IS NOT A TRUST IS PROPERTY OF THE ESTATE
Only an interest in a trust can be the subject of an enforceable transfer restriction within the meaning of 11 U.S.C. § 541(c)(2). An ERISA-qualified plan that is not a "trust" is not excluded from the estate under section 541(c)(2) regardless of the presence of an anti-alienation clause.
In re Adams __ F.3d __ (6th Cir. 2003)
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LIQUIDATION VALUE IS PROPER VALUE FOR REDEMPTION PURPOSES
Debtors moved for approval of redemption pursuant to 11 U.S.C. § 722 and Bankruptcy Rule 6008, seeking to redeem a 2000 Dodge Intrepid and requesting that Liberty Bank’s allowed secured claim in the motor vehicle be set at its trade-in value of $5,300.00. Liberty Bank objected to the Debtors’ motion arguing that the retail value of the motor vehicle is $9,200.00.
Held, the proper measure for valuing collateral pursuant to § 722 is the liquidation method (i.e., trade-in value) and the appropriate date for that determination is the date of the contested hearing.
"The purpose of redemption is to counteract creditor threats of repossession, which often allows the secured creditor to extract more from the debtor than if it had simply repossessed or foreclosed on the property.”
In re Podnar, __ B.R. __ (Bkrtcy.W.D. Missouri 2003)
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