Is bankruptcy right for you?

Call (937) 401-5000

Dayton, Ohio Bankruptcy Attorneys - Cope Law Offices

Dayton Bankruptcy Attorney Personalized Debt Relief Solutions If you are overwhelmed by debt, you may feel as though no one can help you. However, there is help available, and the sooner you take advantage of it, the sooner you will find debt relief solutions. Speaking with a knowledgeable bankruptcy attorney is an easy first step …

Chapter 13 Bankruptcy

by Leave a Comment

Second Job, or File Bankruptcy?

Second Job or Bankruptcy Dayton OhioIf your finances are getting you down, how can you get back on track? For some, the answer may be to get a second job.

In some cases, you can boost your income and help reduce your debt by getting a second job. This is a good option for those who simply need to catch up on bills or payments that were late due to unexpected circumstances. But if you are in severe debt, a second job may not be the ultimate answer for you.

Find out below if a second job is right for you, or if you might have better luck filing for bankruptcy and wiping away your debt.

Millions of Americans Have Multiple Jobs

Millions of Americans are already working two or more jobs, according to a report by Bloomberg News. The number of workers who work multiple part-time jobs to make a full-time one — 2 million — has increased by 11% since 2007. It’s a section of the population that’s also growing faster than people who hold down a full-time job in addition to a part-time job.

During tough economical times, people are resourceful. They often must moonlight to make ends meet. In some cases, people reported having three jobs. The number of people working multiple jobs is not expected to change significantly in the foreseeable future.

If your financial situation is considered temporary, or you are starting to make a dent in your debt, taking another job may be a viable solution. However, it is important to note that in many cases, people are unable to continue working multiple jobs for a long period of time. For some, the option of a second job is used only as a temporary solution to get you through an immediate financial problem. Some people are not able to take on another job because of other commitments such as caring for their children.

Getting a Second Job in Dayton

According to the United States Department of Labor Bureau of Labor Statistics, unemployment for Dayton, Ohio, is at about 4.4% as of the end of 2016. The majority of local jobs last year were in education and health services; trade, transportation, and utilities; government; and professional and business services, respectively.

There are a number of different options for those who want to get a second job, including temporary or short-term employment opportunities. Similar to other employment opportunities, you will be better suited to some kinds of jobs than others.

Determine what type of job will best suit your needs. Many people find success with jobs that allow you to make your own hours or work a flexible schedule. This is particularly important if you’re trying to work around your regular schedule.

Check with temp agencies that are able to match you with local companies that need your services. Seasonal employment is available at retail stores during back-to-school and holiday periods. These jobs offer flexible hours and schedules, while other choices include restaurants and fast-food establishments.

It’s also possible to start your own small business that you can work during your available hours. Some of these possibilities include:

  • Driver for ride-share service
  • Pet sitter/walker
  • Cosmetics sales
  • Fitness instructor
  • Daycare provider
  • Substitute teacher
  • School bus driver
  • Delivery person

When you consider a second job, think about doing something that you like or enjoy, such as something related to a hobby. Think of something that you can do in your spare time, so you can fit it around your other job’s hours.

Should I File for Bankruptcy?

Just because you are behind in your bills doesn’t mean that you need to file bankruptcy. However, in many cases, bankruptcy can be a very good solution to help those who have a serious debt problem. This can occur when you have been out of work for some time, or are facing unanticipated expenses such as those that occur with an accident or serious illness.

When you are consistently unable to make payments on your debts, you become increasingly insolvent. It becomes increasingly difficult to dig yourself out of the financial debt hole that you are in.

There are two main types of bankruptcy that may apply to individuals. Chapter 7 is the simplest type of bankruptcy. Those who file Chapter 7 will be required to liquidate their assets in order to repay as much of their debt as possible. Chapter 13 bankruptcy allows the reorganization of debts into a repayment plan. Once you file bankruptcy, your situation is secured and creditors are no longer allowed to contact you for payments. Instead, you will work within the court system to resolve your debt situation. In many instances, you will be able to keep many of your possessions.

After filing bankruptcy, your credit score will be impacted. However, many people already are facing very low credit scores, which will only continue to decline if the debts remain unpaid. As a person’s ability to repay their debts continues, they will be increasingly unable to get loans, mortgages, or bank notes.

See also: Ohio is One of the Top 10 States for Bankruptcy Filings, How Many People Filed for Bankruptcy in Dayton in 2016?, Where are the Dayton Bankruptcy Courts?

Hiring an Experienced Bankruptcy Attorney

Each debt situation is different, and requires a unique solution. There are many factors to think about when considering whether to file bankruptcy. Some of these include the amount of debt you have, the value of your possessions, how far in debt you are, whether you are employed, and whether you have other ways of resolving your debt problem.

A qualified bankruptcy attorney with Cope Law Offices will evaluate your case to help you learn both the pros and cons of filing for bankruptcy. Contact us today for a free consultation.

by Leave a Comment

How Many People Filed for Bankruptcy in Dayton in 2016?

 

Bankruptcy Trends Dayton OhioLosing your job. Opening the day’s mail and seeing a big, unexpected medical bill you can’t pay for. Never feeling like those credit cards will ever get under control.

These are just a few of the reasons why people in Dayton file for bankruptcy every year. Ohioans are great, hardworking people, but our state is still ranked among the top 10 for the highest percentage of bankruptcy filings — about 322 per 100,000 people. We took a big hit during the Great Recession.

While the amount of bankruptcy cases filed in Ohio, and Dayton, has been on the decline in recent years, mirroring national trends since the height of the economic collapse, there are thousands here locally who still need help with managing their debt every year.

Here’s how bankruptcy cases stacked up in 2016, and where you can turn for advice should you choose to file bankruptcy.

Breaking Down the Numbers

In 2016, the United States Bankruptcy Court Southern District Ohio recorded 4,105 new bankruptcy filings in its Dayton office. Of that, 69 percent were Chapter 7 (2,831) and 31 percent were Chapter 13 (1,273). Just one Chapter 11 bankruptcy was filed the entire year, and no Chapter 12.

Ninety-seven reopened cases were included in the grand total of Dayton bankruptcy cases for 2016. There were 115 adversary proceedings filed last year. An adversary proceeding (AP) is a lawsuit filed separately from a bankruptcy case, though related, and resembles a typical civil case as found in Rule 7001 of the Federal Rules of Bankruptcy Procedure. Rule 7001 governs adversary proceedings, which include those to determine the dischargeability of debt, revoke an order of confirmation of a Chapter 11, Chapter 12 or Chapter 13 plan, and more.

The busiest month for bankruptcy filings in Dayton was March for total cases (417) as well as Chapter 7 filings (312), though July was the busiest month for just Chapter 13 (139).

On Trend with National Statistics

The Dayton office accounts for 24.4 percent of total bankruptcy cases in the Southern District of Ohio, which also includes Columbus and Cincinnati, with its percentage of Chapter 7 and 13 bankruptcy filings lining up with the average across all offices. More than 17,000 bankruptcy filings took place in the entire district in 2016.

Nationally, of the top 15 bankruptcy courts, the Southern District Ohio ranks 9th in total filings. The Northern District Illinois ranked 1st, with 44,937 total filings.

Districtwide, bankruptcy filings have decreased every year the past five years, generally by between 1,000 to 3,000 fewer cases each year. The decline has slowed, just like it has nationally.

Fewer than 800,000 people filed for bankruptcy in federal courts last year across the U.S. Compared to the 1.6 million bankruptcy filings nationally in September 2010, that’s a big drop in six years.

While the amount of U.S. bankruptcy filings in 2016 was the lowest out of any calendar year since 2006, the decrease in cases is slowing down. 2016 was the first calendar year since 2011 that the percent decrease no longer was double-digit.

A Look Ahead — Is Bankruptcy Right for You?

Despite the overall trend of bankruptcy on the decline, so far, for January 2017, the amount of bankruptcy filings in Dayton are up compared to January 2016. Eighty-one more cases were filed last month compared to the same month a year prior.

Chapter 7 is the clear front-runner in both national cases and locally. To figure out if you should file Chapter 7 or 13, Ohio has some income guidelines to follow. Chapter 7 is basically a “liquidation” of your assets, while Chapter 13 puts you on a repayment plan to your creditors. If you can pay back your creditors, typically Chapter 7 isn’t right for you.

You also want to make sure you’re always filing in good faith, or you could be looking at the court dismissing your case. Eliminate lavish spendings, and work on tightening your wallet. A luxury lifestyle in the midst of a bankruptcy proceeding isn’t going to look good to a judge.

We have some great budget basics that we’ve researched, such as splitting your expenses into categories like rent/mortgage, groceries, credit card payments, with some left over for savings and entertainment. Getting back on track does take time, though, so don’t be dismayed.

If you are struggling with the idea of filing for bankruptcy, we can help. We’ve successfully managed hundreds of bankruptcy cases, and can determine if bankruptcy is right for you. Our expertise includes bankruptcy, bankruptcy protection, bankruptcy and foreclosure, Chapter 7, Chapter 13, and unsecured and secured debt.

Contact us today for a free case review.

Image Credit

by Leave a Comment

Where are the Dayton, OH bankruptcy courts?

When you file a bankruptcy, you’ll need to visit the bankruptcy court. You may choose to file your bankruptcy in person with the clerk. You may also need to go to the court for hearings with creditors and the bankruptcy trustee.

If you’re filing with the help of an attorney, you may not have to go to the court in person. Your attorney will file your paperwork and may be able to handle any hearings without you being there. If you’re filing without an attorney, you do have the option of filing your case online. You’ll still need to attend any hearings in person.

So, where do you need to go?

Dayton is a part of the Southern District of Ohio. The court is located at:

120 W 3rd St #100
Dayton, OH 45402
(937) 225-2516

Getting There

The easiest way to get to the bankruptcy court is to drive. You can find paid public parking at:

  • Parking Management at 126 E 2nd St.
  • First St. Garage at 23 W First St.

There are also a number of public transportation options:

  • Take the 08, 19, 65, 66A, or 66B bus to W 4th St. at Wilkinson
  • Take the 01, 02, 04, 08, 18, or 41 bus to W 4th St. at Ludlow
  • Take the 09, 14, or X5 bus to N Perry St. at W 2nd St.

 

by Leave a Comment

Will Personal Bankruptcy Affect My Business?

Personal Bankruptcy And Your BusinessUnfortunately, owning a business doesn’t mean you can’t run into personal financial trouble. If you have too much debt to handle, a bankruptcy can help you wipe the slate clean and start over. But will a personal bankruptcy affect your business?

Personal Bankruptcy And Your Business

The effect of a bankruptcy on your business will depend on the type of bankruptcy you choose to file and the way your business is organized. Small businesses are typically organized in one of four ways:

  • Sole Proprietorship: A sole proprietorship is unincorporated and has one owner. The business and owner are treated as the same entity, meaning you pay personal taxes on the income the business generates and the business doesn’t pay any taxes separately. The owner is liable for any debts the business incurs.
  • Partnership: Two or more owners run the business together, with all partners contributing money, labor, property, or other assets. Each partner pays personal taxes on their portion of the income from the business. Partners are liable for the entire amount of the debts of the business – not just their proportional share.
  • Limited Liability Company (LLC): An LLC is its own entity, separate from the owner(s). It must pay taxes and owners are not liable for the business’s debts.
  • Corporation: A corporation is a separate legal entity owned by shareholders. Corporations pay their own taxes and shareholders are not liable for the business’s debts.

Chapter 7 Bankruptcy And Your Business

Chapter 7 is “liquidation” bankruptcy – your non-exempt assets are sold and used to pay creditors. You keep your exempt assets and the rest of your debts are discharged. Where does your business fit in?

  • If you have a sole proprietorship, you and your business are considered one and the same entity. The business’s assets are also your assets. If they’re not exempt, the trustee can sell them to repay your creditors.
  • If you have a partnership, you and your business are considered the same entity just like a sole proprietorship. However, you share the business assets with your partner(s). The trustee can in theory sell those assets with approval from the court, but that approval isn’t very likely to be forthcoming because it isn’t fair to the other partner(s). However, the trustee may be able to sell your entire share of the partnership if he or she can find a buyer for it.

If you own an LLC or a corporation, things are a little more complicated. The business’s assets are safe from the bankruptcy trustee. Your ownership interest, on the other hand, is part of your bankruptcy estate. If you can’t protect it with an exemption, the trustee can do one of four things, depending on what produces the most value for creditors:

  • Liquidate: Sell the business assets, pay off its debts, and use the remainder to pay creditors
  • Sell: If there’s a buyer, the trustee can simply sell your ownership interest
  • Operate As A Going Concern: With the court’s permission, the trustee can allow the business to continue to operate so it can be sold as a going concern
  • Abandon: If there’s no buyer or if the business’s debts are greater than its assets, the trustee can simply ignore the business and you’ll still own it

Chapter 13 Bankruptcy And Your Business

In Chapter 13, you’ll work with the bankruptcy court to create a 3-5 year payment plan based on your income. You’ll make monthly payments and the court will distribute it to your creditors. In general, this won’t affect your ownership in your business. However, remember that if your business is organized as a sole proprietorship or a partnership, you and your business are inseparable in the eyes of the law. That means any income the business makes will be considered your income and will be part of the payment plan.

Chapter 13 May Not Be An Option

While Chapter 13 is safe for your business, it may not be available to you. To qualify for Chapter 13, your payment plan must result in your creditors getting at least as much money as they would if you filed for Chapter 7. So, the court will look at what assets would have been sold off in Chapter 7 to pay your creditors.

Say you have a sole proprietorship with assets valued at $100,000 and liabilities of $20,000. The assets are worth $80,000. Or say you own a corporation worth $80,000. Assuming no exemption applies and there’s likely to be a buyer for the assets, that means your creditors would get at least $80,000 under Chapter 7. If your payment plan doesn’t result in at least $80,000 worth of repayment, you’ll have to file under Chapter 7.

A lot of the issue depends on how “liquid” the assets (either your business assets or your ownership) are – how easy it is to turn them into cash. Illiquid assets may be valuable, but they’re not easy to sell and the court won’t be able to say how much your creditors would have gotten in a Chapter 7. Basically, things can get complicated quickly. You’ll need to work with an experienced attorney to determine whether you’re likely to qualify for Chapter 13.

Other Complications

The effect of a personal bankruptcy on your small business is complicated enough if you’re the only owner – the value and liquidity of your assets or ownership may be very difficult to evaluate. Things get even more complicated if you have a partner or if you’re not the only owner of the LLC or corporation. If that’s the case, the court will have to decide how to handle your bankruptcy without being too unfair to the other owners – it can get very complex, very fast. You’ll need an experienced bankruptcy attorney to help you navigate the case and minimize the impact on your business.

The Bottom Line

Starting a business is no small feat, and you certainly want to protect what you’ve worked so hard to build. If you’re considering a personal bankruptcy, contact us today for a free consultation to learn about your options for handling your personal debt while protecting your business.

by Leave a Comment

Ohio Homestead Exemption: Can I Keep My Home in Bankruptcy?

Ohio Homestead Exemption BankruptcyLast updated March 30, 2017.

Your home is one of your largest assets. Your mortgage is probably the largest loan you’ll ever take out. If you’re struggling to pay your bills, it’s also probably your biggest worry. Bankruptcy might be your best option, but what happens to your home when you file?

Ohio Homestead Exemption

The Ohio homestead exemption provides protection for homeowners during a bankruptcy. Essentially, it prevents a bankruptcy trustee from uprooting you from your home and selling it during your bankruptcy proceeding.

There are two main ways to file bankruptcy as an individual that offer protection of your home, depending on which you qualify for: Chapter 7 or Chapter 13. Although bankruptcy either clears your debt or puts you on a payment plan for it, it doesn’t just give you a free home.

If your home is exempt through the bankruptcy proceeding, you will still need to pay the mortgage as usual. Chapter 7 bankruptcy will discharge your personal liability under the mortgage, but will not extinguish the bank’s claim on your property. In other words, the bank won’t be able to sue you for collection but will still be able to repossess and sell it if you don’t make payments.

See also: Will Filing for Bankruptcy Stop Foreclosure in Ohio?, What Factors Influence Your Mortgage Interest Rate?

Chapter 7 Bankruptcy and Your Home

Chapter 7 is a “liquidation” process. All of your assets temporarily become a part of your bankruptcy estate. Your bankruptcy trustee will then sell those assets and distribute the proceeds to your creditors.

If you qualify to file under Chapter 7, which is based on your income, the fate of your home will depend on the amount of equity you have in your home (the difference between the value of your home and the amount you still owe on it). In Ohio, if you have less than $125,000 of equity in your home (or $250,000 for married couples filing jointly), it’s exempt and can’t be touched by the trustee. If you have more than that in equity, the bankruptcy trustee may try to sell your home, pay you $125,000, and distribute the rest to creditors.

Chapter 13 Bankruptcy and Your Home

Under Chapter 13, you’ll work with creditors and your bankruptcy attorney to create a 5-year repayment plan. Your plan will need to include full payment to your secured creditors (or allow for continued payments after the end of the 5-year term) and as much of a payment as possible for your unsecured creditors.

The Chapter 13 payment plan is based on your levels of disposable income. Under Chapter 13, as long as your mortgage is included in the plan and you keep making payments, you’ll be able to keep your home.

Chapter 13 bankruptcy also can help prevent foreclosure by allowing debtors to pay back mortgage arrearages in manageable increments.

See also: Should I Refinance My Mortgage?, How to Negotiate with Your Mortgage Loan Servicer

Get Help from an Experienced Bankruptcy Attorney

Bankruptcy can be pretty complicated, especially when you’re dealing with a lot of assets, like a home you’ve put a lot of work into or bought as your dream house and want to keep. In Ohio, bankruptcy is a common solution to relieving debt — in fact, it’s one of the top 10 states for bankruptcy filings.

At Cope Law Offices, we will work with you on creative debt solutions and help win your bankruptcy case. Contact us today for a free case review.

by Leave a Comment

Filing Bankruptcy Won’t Get You Out of Jail For Delinquent Child Support

Civil Lawsuits and the Automatic Stay

The automatic stay goes into effect when you file for bankruptcy and prevents creditors from pursuing action against your property in an attempt to collect debts. It also stops all civil lawsuits involving the debtor. Any action against a debtor brought after he files for bankruptcy violates the automatic stay. If a debtor is incarcerated before filing for bankruptcy, does the automatic stay compel his release?

Struggling With Child Support…

The story of In re Rucker, 458 B.R. 287 (D.S.C. 2011).

Tony had no job, so he couldn’t make his $240 monthly child support payments. He failed to make payments for so long that the South Carolina Department of Social Services (DSS) brought suit against him. The judge found him in contempt for this failure and sentenced him to jail for a year. Tony could earn his release at any time by paying his debt of almost $5,100.

He participated in a work release program for a short while with the Department of Transportation but had an altercation with his supervisor. That fight disqualified him from the work release program and from early release for good behavior. Tony was going to have to spend the whole year in jail. A fellow inmate told him that the automatic stay could get him out of jail, so Tony filed for Chapter 13 bankruptcy.

Escape Attempt…

In his bankruptcy filing, Tony listed monthly income of around $1,500 and total debts of about $10,000. He argued that the automatic stay required his release from prison. The automatic stay applies to “the commencement or continuation … of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the [bankruptcy] case.” 11 U.S.C. § 362(a)(1). Tony claimed that the action against him by the DSS had arisen before his bankruptcy filing and so should be stopped, allowing him to leave jail.

… And Failure

First, the court noted that Tony was probably ineligible for Chapter 13 bankruptcy anyway. A debtor needs income that is “sufficiently stable and regular … to make payments under a [Chapter 13] plan.” § 101(30). While Tony claimed that he earned around $1,500 monthly, he also testified that he had been unemployed for the six months prior to his incarceration and he gave no evidence that he would be employed upon his release. Tony had no property to turn over to a bankruptcy estate, so creditors had no chance of any repayment at all.

He also stated specifically that he had filed for bankruptcy in order to get out of jail. The court found that he had filed in bad faith and dismissed his bankruptcy. That canceled the automatic stay as of the dismissal.

Even though his case was meritless to begin with, Tony argued that the DSS and the Family Court had already violated the automatic stay by keeping him in jail. He sought damages from them for holding him when the automatic stay required his release. Tony’s attorney pointed to several cases in which the court ordered a debtor released from incarceration, but in each of those cases the debtor filed between the start of proceedings and the order for incarceration, so the incarceration happened after the bankruptcy filing. In Tony’s case, the judge entered the Contempt Order sentencing him to jail before he filed for bankruptcy. After he filed, no one acted to collect the child support payments Tony owed and no one acted against his property. No new lawsuits were filed and no old lawsuits were continued. So, no one violated the automatic stay. Tony would have to sit in jail until he either did his time or paid his child support.

If you’re already in jail, it’s too late. 

The automatic stay is meant to protect debtors from the collection actions of creditors after they file for bankruptcy. The Family Court sent Tony to jail before he filed for bankruptcy, so the automatic stay did not apply. Bankruptcy is a way to reorganize your finances, not a way to get out of a judgment that has already been rendered against you.

Image from Flickr user i am real estate photographer