When filing for bankruptcy, a debtor may forget to list a creditor. This is not an ideal situation for the debtor, as they may still owe that debt after discharge.

When a debtor is filing for bankruptcy protection, they must fill out numerous documents that tell the court the names of all the creditors involved in their case, what real and personal property they own, and who their unsecured and secured creditors are and how much they are owed. The list must be complete, but occasionally a creditor is inadvertently left off the list. It is best to immediately consult with your Iowa bankruptcy lawyer to find out what to do when you discover that your creditor list is incomplete.

If the debtor has filed a Chapter 7 bankruptcy, he or she is required to submit Schedules A through J to the bankruptcy court as part of their bankruptcy petition. Schedule A lists the debtor’s real property. Schedule B lists all personal property the debtor owns and Schedule C lists property exemptions.  Schedule D lists secured debts (such as mortgages or car loans), Schedule E lists unsecured priority debts (such as child support or past-due tax obligations), and Schedule F lists unsecured nonpriority debts (such as credit cards and medical bills).  In schedules D through F, debtors must list all of their creditors, and provide the following information as it pertains to each debt he or she has with each creditor: the account number used with each particular creditor; the creditor’s name and mailing address, and the amount owed to the creditor.  The bankruptcy Trustee uses Schedules D through F to ensure all creditors are recognized and paid. The remaining Schedules are G through J. If the debtor has executory contracts and/or unexpired leases, they are listed on Schedule G. If the debtor has any co-debtors, then on Schedule H the debtor must provide the name and address of each co-debtor as well as identify the shared creditor. Finally, the debtor’s monthly expenses and income are set forth on Schedules I and J.

As you can see, with all the lists, rules, and various requirements for filing for bankruptcy protection, it is possible to accidentally omit a creditor. If your case is being handled by a competent Iowa bankruptcy lawyer, he or she will attempt to ensure that your Schedules are complete and accurate by asking questions designed to help you search your memory for forgotten debts.

Once the Chapter 7 bankruptcy has been filed, it is the Trustee’s responsibility to identify and liquidate the debtor’s non-exempt property, and then notify the list of creditors set forth in your Schedules of any possible distributions. If the debtor forgets to list one of his or her creditors, then that forgotten creditor will not have the opportunity to receive a portion of any potential distribution in the case. The most important thing to note is that if the debtor forgot to list a creditor in his or her bankruptcy, and the debtor receives a discharge of his or her debts, the debt to the forgotten creditor is arguably still owed.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

Bankruptcy lawyers are often asked if active duty military may file for bankruptcy. The answer is yes.

There are a lot of people who believe that active duty military personnel are not allowed to file for bankruptcy relief. “While military personnel are held to a higher standard of conduct than regular citizens, they do not have to give up the right to declare bankruptcy,” said Kevin Ahrenholz, an Iowa bankruptcy lawyer.

Even dedicated military personnel may run out of money before they have come to the end of the month, and if this continues for a sustained period of time, the individual may need to consider filing for bankruptcy protection. It does not matter if they are in the military at the time they file, and it does not matter what Chapter of bankruptcy they elect to file. They have the same rights as all U.S. citizens when it comes to declaring bankruptcy.

Filing for bankruptcy while on active duty may have other consequences for members of the Armed Forces, such as a negative effect on security clearance and promotions. However, they are still entitled to file and have legal protection accorded to them if their duties get in the way of attending bankruptcy court hearings.

To file for bankruptcy, the service member needs to determine the appropriate state in which to file their petitoin. Federal law mandates they file their bankruptcy in the state where they have lived for the greater part of the six months prior to filing. “Since military personnel are frequently transferred, they need to check the bankruptcy filing requirements of where they currently live,” said Ahrenholz.

Military personnel must also get credit counseling within the six month period before they file, and the Department of Justice has a list of counselors on its website. While the counselors do not get involved with the bankruptcy case, they will outline the process and answer any questions. The next step is to determine which Chapter to file. The choices for personal bankruptcy are either Chapter 7 or Chapter 13. The Chapter is dependent on the size of the debtor’s household and whether his or her income falls above or below the median average income for that size of household in his or her state of residency.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

One of the questions that bankruptcy attorneys often get asked is whether the debtor is allowed to withdraw from bankruptcy proceedings. Perhaps you have already started the bankruptcy filing process by consulting an experienced Iowa bankruptcy attorney who has assisted you with filling out all the right documentation, and you’ve paid the fees and you are moving forward. 

The next step is advising your creditors that you have filed for bankruptcy, and perhaps meeting with them and attending a credit counseling session. You are eventually heading to a U.S. Bankruptcy Court hearing (Meeting of Creditors), and your Iowa bankruptcy lawyer advises you that you will be through the process shortly. Any second thoughts you might have had about taking this route have long since vanished. You still believe filing for bankruptcy was the only thing you could have done to get out from under your overwhelming debt load. 

Then, before you get to your hearing, you get a phone call or a letter advising you that you have just come into some money, perhaps through inheritance or the lottery. Things like that do happen, although rarely. If you suddenly and unexpectedly come into money, you are allowed to stop the bankruptcy process in its tracks. However, you are still responsible for paying off your creditors. Once you have done that, the information that you gave to your lawyer that was then once entered into the system is purged. You will not have a record of filing for bankruptcy. 

While winning the lottery might seem like a pipe dream, at least you know you do have the opportunity to withdraw from a bankruptcy proceeding should the circumstance arise.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

It is possible for individuals and businesses to avoid being forced into involuntary bankruptcy.

The more debt an individual or company incurs, the higher the risk becomes that creditors will file bankruptcy against them. This is referred to as involuntary bankruptcy, and in some cases, it may be justified. In other cases, it is necessary for the debtor to defend against involuntary bankruptcy petitions in order to avoid surrendering assets or being forced to sell them.

“Individuals or businesses who find themselves in receipt of an involuntary bankruptcy petition need to reach out to a qualified lawyer for help,” said Kevin Ahrenholz, an Iowa bankruptcy attorney. If an individual or company is served with an involuntary bankruptcy petition, one of the first things that individual or company must do, aside from hiring a reputable bankruptcy lawyer, is find every record on file relating to paychecks, monthly bills, loans, mortgages and lines of credit.  These documents are required to prove the amount actually owed to each creditor, versus what may be stated in an involuntary bankruptcy petition by a creditor. It is also helpful to provide a complete overview of net income and expenses, and then break down each month’s financial activity. Bank statements can also be used as evidence of past payments to creditors.  The idea is to demonstrate to the court that the debtor’s financial picture is improving. If it can be proved that the debtor’s financial liabilities are being paid, and he or she is making an effort to pay off debts owed, this is often enough to defeat an involuntary bankruptcy petition. If a debtor is able to prove that their debt is less than $10,000, this too may – in most states – defeat an involuntary petition.

Ahrenholz stated that the debtor has 20 days within which to file any complaints that he or she has against any creditor who has filed an involuntary bankruptcy petition against him or her.. When an objection is filed, the matter most often ends up in court. Once in court, the debtor can attempt to prove that the creditor merely filed the involuntary bankruptcy in order to gain favor over other creditors. The court may dismiss the petition, noting that the point of bankruptcy is to distribute assets evenly among all creditors and not just to select and prefer a few.  In the event that the debtor is unable to convince the court that the bankruptcy is unnecessary, the best way for the debtor to recover a position of control is for the debtor to work towards converting the case into a Chapter 13 bankruptcy.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

If you are responsible for paying spousal support, filing bankruptcy will not negate that obligation.

You just found out that your spouse has filed for a divorce and you are in a panic. Perhaps at some point you made the decision to actually stop paying on your debts because you just could not keep up, and being served a divorce petition was the last straw. You think now it might be time to file bankruptcy, as you do not have the money to pay support. You also need to file some kind of response to the divorce action. Before you make any kind of decision relating to your divorce and/or filing for bankruptcy, consult with an experienced Iowa bankruptcy lawyer. If you make the wrong move now, you could find yourself with legal difficulties.

What considerations are there with respect to divorce and bankruptcy? Before the Bankruptcy Act of 2004, it was possible to discharge debts that came about as a result of divorce. Since lawmakers considered this to be a loophole, amendments were made to the Act to close it, which means you may no longer discharge any financial obligations that are the result of a divorce, including spousal and child support.

Your main consideration should be whether you are eligible to file for bankruptcy protection.  The fact that you are facing a divorce is irrelevant to the issue of filing bankruptcy. However, in order to make the most informed decision about how best to proceed and whether to file Chapter 7 or Chapter 13 bankruptcy, it is imperative that you discuss your situation with a qualified Iowa bankruptcy lawyer.

Filing for bankruptcy is stressful enough without also facing divorce at the same time. This is when you need to services of a skilled Iowa bankruptcy lawyer to help you get through the maze of rules, regulations, credit counseling, and paperwork. If you attempt to file bankruptcy on your own without legal counsel, you may be wasting your time and money and ultimately find yourself at risk having of your bankruptcy petition dismissed. Hiring a knowledgeable bankruptcy attorney is the best investment you will ever make.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

It is a good idea to keep a copy of all of your bankruptcy case-related documents, particularly your discharge paperwork. However, if you lose it, it may be replaced.

When the bankruptcy process is concluded, the debtor is released from liability on a variety of debts. When the court determines the debtor has fulfilled all of his or her obligations in filing for bankruptcy protection, the discharge order is entered by the court and the debtor gets a copy of his or her discharge papers in the mail. It is wise to keep your copy of these documents.  Your Iowa bankruptcy lawyer will remind you of the importance of keeping these kinds of documents throughout your bankruptcy filing.

Remembering to keep original bankruptcy discharge papers is routine for some debtors and more difficult for others. Managing and organizing court-related documents is not something most debtors do on a regular basis. If you are a debtor who has lost your bankruptcy discharge papers, you may obtain another copy in one of three ways.  The first way to obtain copies of case-related documents is to contact your Iowa bankruptcy lawyer to see if he or she has an extra copy of the document you are seeking in the office file. 

Your second option is to contact the court where your bankruptcy petition was filed. If you want to do this in person, contact the clerk of the bankruptcy court where your bankruptcy case was filed and discharged. If you are not certain which court you need to contact, you can ask your Iowa bankruptcy attorney or search online using the PACER system. If you choose to search online, you may need to pay a fee for the clerk to search and certify your papers and have them sent to you in the mail, or you may opt to pick them up in person.

Your third option in seeking a copy of your bankruptcy case-related court documents is to go online and access the Federal Courts PACER system. The PACER system allows individuals to create a free user account prior to searching for a copy bankruptcy case-related documents, including the petition or the discharge papers. If the information is located in the database, you then have to indicate how you will pay the per-page fee in order for the information to download to your computer. If you are not the debtor listed in the document you want, you are still able to obtain a copy of any public record bankruptcy papers by speaking to the bankruptcy court clerk where you filed your bankruptcy papers.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

For credit counseling, choose a counselor that works only for you, not a third party. 

If you are going to credit counseling as a result of filing for bankruptcy protection, you need to choose an independent individual who will be working for you, and who has no affiliations with banks or other lending institutions. You might wonder how you would do that or how would you compare them? 

The first thing you need to determine is who is responsible for paying them. Do they work for you? Do they work for the bank where you have a loan? Do they work for a credit card company? The answers to these questions are important, mainly because you want someone that is 100 percent advocating for you as opposed to someone who is working on behalf of the people that loaned you money. 

Good, independent choices for credit counseling may run the gamut from an attorney that specializes in that area to an accountant with extensive experience in dealing with bankruptcies. It could also be an individual who may work for a credit reporting company, or a business that helps people work through their financial issues. If at any time you are uncertain about how to find a credit counselor that is not affiliated with a lending institution, ask your Iowa bankruptcy lawyer for suggestions. 

If you discover that the person or company you want to deal with has ties to a lending institution, bank, credit union, or credit card company, then you can expect they are not working in your favor. They may look like they offer good service and advice, and in fact may do a good job, but their real reason for helping you is likely to get as much money back from you as possible. They may even be free, which is tempting when you have very little money to go around. 

Opt for the independent credit counselors, whose only job is to help you deal with the difficult situation you find yourself in. At any point during the process of filing for bankruptcy protection, it is smart to keep asking questions about what is happening, what is next, what documents are required, and what to expect when things are said and done. Your Iowa bankruptcy attorney will guide you step-by-step through the maze of rules and regulations. You just have to ask for help. 

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

It is really intimidating filing for bankruptcy. Often people make mistakes on filing, or try to hide assets and property.

Filing for bankruptcy is an overwhelming decision. Actually sitting down with a skilled Iowa bankruptcy lawyer and reviewing your situation often causes anxiety. It is a big step and the whole process can be overwhelming, which is why it is a smart move to hire a qualified Iowa bankruptcy lawyer to help you get through the maze of rules and regulations.

Some people may be scared to admit to what they have in assets, because they do not know for sure what to declare. Others deliberately lie about their assets, property and spending habits. In both cases, not fully revealing all of your assets and complete financial situation may result in the court dismissing your bankruptcy petition. You may face penalties, fines and possible jail time. If you are facing bankruptcy, make certain you fully understand what constitutes bankruptcy fraud.

What many people do not realize is that it is possible to commit bankruptcy fraud before they file for bankruptcy protection, or even before they may be aware they may need to file. Sales or gifts of property or money during the two-year period before filing a bankruptcy are examined in minute detail by the bankruptcy court. The reason for this time frame is that, in most instances, bankruptcy means seizing and selling the debtor’s assets.

Some debtors then try to keep their property by transferring it to a family member or best friend. If property or other assets have been transferred during the two-year period, and the court deems the transfer was not for a legitimate and fair reason, they may find you liable for fraud. This is not the only way to commit fraud. In fact, another common method is providing false information to the court by leaving assets off the schedule of assets, or claiming exemptions that are not applicable. In both of these situations, the debtor is intentionally making a false statement to the court in the hopes they can get away with something. The court does not take bankruptcy fraud lightly.

Another method debtor’s have used to attempt bankruptcy fraud is to give a creditor a false statement. An example would be taking out a personal loan and stating your income was $60,000 a year. The bank would give you a loan based on that stated income, which is false. When you file for bankruptcy, the bank will ask the court to not declare the loan as discharged in the bankruptcy. If the credit institution is able to prove your statement of income was a lie and that your statement convinced them to loan your money, you will not be able to discharge that debt. In other words, you will still need to repay the loan after the bankruptcy has been processed.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

Debtors who withhold information on purpose when filing for bankruptcy are filing a fraudulent bankruptcy.

People often withhold information when they file for bankruptcy. It may be due to the fact they are not sure about what they need to include in their filing, or they are keeping the information to themselves on purpose. Withholding information constitutes a fraudulent bankruptcy under the rules of the Bankruptcy Act of 2005, which means it is considered to be a federal offense. Additionally, the statute of limitations for bankruptcy fraud cases depends on what kind of concealment was involved.

When a debtor files for bankruptcy, they are responsible to provide all relevant information about their financial status, assets and spending habits. This type of information is used by the court to figure out your eligibility for bankruptcy, and once this material is filed, you get an immediate stay to halt all collection activities.

The most common types of bankruptcy fraud attempted are trying to conceal property or income. The debtor does not include information that is required by omitting income sources and/or jobs and does not list property in the petition. Property could include vehicles, homes, or jewelry. Other types of fraud that debtors have been known to try are receiving property from someone who is planning to file for bankruptcy relief and then not mentioning it during their bankruptcy hearing.

Officially, the statute of limitation for a fraudulent bankruptcy is five years. In other words, it is the median, but it is best to keep in mind that it does not go into effect until the bankruptcy case is discharged or denied. An example of this would be an individual filing for Chapter 13, with a five-year plan to repay all or a portion of their debts. If the bankruptcy was fraudulent, the federal court then has five years after the discharge, the end of the payment plan, to begin prosecuting the debtor. Put another way, the federal government had a total of ten years to build a bankruptcy fraud case against the debtor.

You should also be aware that after a discharge is granted, the bankruptcy court can move to revoke it. They would do that based on the determination that the discharge was approved as the result of the debtor hiding pertinent financial information from the scrutiny of the court. The creditor’s lawyer has one year to petition the court to revoke the discharge before a separate statute of limitations kicks in. As you can see, this is a very complex process.
If the debtor is found guilty of bankruptcy fraud before the statute of limitations expires, this is a felony offense, with a fine of up to $250,000 and five years in jail. On top of this possible consequence, other creditors have the option to take legal action once they are made aware the bankruptcy discharge was revoked or the case denied.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.

Veterans facing bankruptcy typically ask if their benefits should be included on Schedule 1.

Schedule 1 is a form required by the bankruptcy court, and it is otherwise referred to as Current Income of Individual Debtor. If you are a veteran, and are filing for bankruptcy protection under Chapter 13 or Chapter 7, then this form must be included. If you have a spouse, there is a place for them to be added on the form. While these forms may seem complex, if they are discussed with a qualified Iowa bankruptcy lawyer, most of the questions would be clearly answered.

As with many rules and regulations, there are some exemptions to this rule. In this instance, there are certain items that are considered to be exempt from liquidation under a Chapter 7 bankruptcy. Those exemptions include alimony, child support, Social Security, unemployment and veteran’s benefits. Even though the veteran’s benefits are exempt, they are still used to calculate a debtor’s financial situation.

For example, if a veteran is getting regular wages, those need to be listed in Schedule I as the gross amount along with any overtime. Any payroll deductions must be taken off wages for the net take home pay. For items 7 to 13, if the veteran debtor has other forms of income, these must be listed. Section 11 would be the area in which to include veteran’s benefits, on the line that asks for ‘Other Monthly Income.’

If a veteran is in a situation where Veteran’s Affairs is only paying them benefits temporarily for a disability, such as an illness that they will recover from, they need to know when the payments end within the year. Then, they would fill in line 17 on Schedule 1 outlining the reasons the benefit is temporary. Again, theses forms can be filled out with the help of an Iowa bankruptcy lawyer.

While filling out all the forms may seem unnecessary, they are required in order to match them up with the means test that all debtors must go through to determine their eligibility for filing bankruptcy under Chapter 7 or Chapter 13. There is always the possibility that an applicant does not qualify, and this is something that can be figured out with the assistance of a skilled Iowa bankruptcy lawyer. For those that do not qualify for Chapter 13, they may instead, be eligible for Chapter 7. It all depends on the means test and the corollary information filed to initiate the process of seeking bankruptcy protection.

Although Schedule I is used for both Chapter 7 and Chapter 13, the Chapter 13 forms will demonstrate to the trustee how much money is being earned in the household. This, when paired with Schedule J listing debtor’s expenses, will show if there is enough income to pay back some of the debt or not.

Kevin Ahrenholz is an Iowa bankruptcy lawyer and Iowa bankruptcy attorney. To contact him, visit https://www.iowachapter7.com or call 1.877.888.1766.