TicketsThat's the title of Denver Law Professor Michael Sousa's new article exploring debtors' evaluations of the pre-filing credit counseling course and the post-filing financial management course mandated by BAPCPA. The data for the article came from in-depth interviews that Sousa conducted with 58 individuals from Colorado who filed under Chapter 7 between 2006 and 2010. Bob Lawless previously posted about another article Sousa wrote based on the interviews that discusses debtors' perceptions of bankruptcy stigma. Like Sousa's previous article, this paper carefully presents the interviews for what they are and what they can reveal about debtors' interactions with these two components of the bankruptcy process.

Credit Slips
(posted 14 hours 29 min ago)

What Happens to Utility Bills in Bankruptcy? When debts pile up, it can become overwhelming to pay any bills. And during the summer especially, Arizona utility bills can be astronomical. And because utilities are very important, you may wonder what will happen to your service if you file a bankruptcy petition. Will you still have […]The post What Happens to Utility Bills in Bankruptcy? appeared first on Tucson Bankruptcy Attorney.

(posted 18 hours 18 min ago)

Typically, individuals who file bankruptcy have a choice between filing a chapter 7 “liquidation” and a chapter 13 “reorganization”. Individuals who are determined to have disposable income under the Means Test only have the option of filing chapter 13 and repaying their creditors. However, individuals still have to meet certain eligibility requirements to file chapter 13.
First, only individuals may file chapter 13. Small businesses and corporations can only reorganize under chapter 11. Chapter 13 was designed to be a simpler, more efficient way to reorganize and therefore is only available to individuals. Furthermore, stockbrokers and commodity brokers are excluded from filing chapter 13.
Second, individuals filing chapter 13 must have “regular income”, i.e. wages, business or rental income, alimony or child support, or retirement income. In other words, a chapter 13 repayment is not possible if there is no consistent source of income to repay creditors.
Finally, when filing chapter 13, an individual cannot have more than $383,175 in unsecured debt and cannot have secured debts totaling more than $1,149,525. The debt limit includes non-dischargeable debt like student loans. Again, this reinforces the idea that chapter 13 is meant to be a simpler version of chapter 11 and the more debt a person has, the more complicated their bankruptcy will likely be.

Lake Law Blog
(posted 21 hours 8 min ago)

Los Angeles Bankruptcy HelperLos Angeles Bankruptcy Helper just hit 200!
This Los Angeles Bankruptcy Helper just hit 200. Not 200 years old. But 200 great Los Angeles bankruptcy helper articles. It is a happy day!
We began our blog in May 2010.  We didn’t know then how fast it would grow. Our Los Angeles Bankruptcy Helper Blog has attracted significant attention. References to our blog appear regularly on many respected sites. We enjoy links from web sites like the American Bankruptcy Institute, the National Association of Chapter 13 Trustees, and Nolo.

Los Angeles Bankruptcy Blog
(posted 23 hours 18 min ago)

An important issue in determining whether a transfer is avoidable as a constructive fraudulent transfer is determining whether the debtor received reasonably equivalent value in exchange for the transfer.  If the debtor receives reasonably equivalent value in exchange for assets transferred prior to the bankruptcy, there is no constructive fraud.  While section 548(d)(2)(A) of the Bankruptcy Code defines “value” as “property or satisfaction or securing of a present or antecedent debt of the debtor,” the Bankruptcy Code does not define “reasonably equivalent value.”
Courts treat reasonably equivalent value as a question of fact and determine whether a value is reasonably equivalent on a case-by-case basis.  “Reasonably equivalent” is not synonymous with fair market value; instead, fair market value is one of a number of important elements in a “totality of the circumstances” analysis.  Another important element used in courts’ analysis is good faith.  A recent decision from the Bankruptcy Court for the District of Colorado, Mercury Companies, Inc. v. FNF Security Inc. (In re Mercury Companies, Inc.), advises that a purchaser’s mere knowledge of a seller’s financial distress does not preclude a finding of a good faith transfer.
Background

(posted 23 hours 22 min ago)

Party-goods supplier Event Rentals Inc. is kicking off the week in bankruptcy with a Monday auction of its assets.
A group of the company’s senior lenders, including Cerberus Capital Management, has been approved as the lead bidder with a $124 million credit bid. If it emerges as the winner, the lender group would forgive Event Rentals’ debt in exchange for the company’s assets.
Event Rentals filed for bankruptcy protection on Feb. 13 with roughly $148 million in assets and $246 million in liabilities. The company blamed its financial problems on an ill-timed growth spurt and the reluctance of corporations in recent years to throw lavish parties.
On Tuesday, plus-size women’s clothing retailer Ashley Stewart will seek a Trenton, N.J., bankruptcy court’s blessing of its proposed sale to Clearlake Capital Group for approximately $18 million.

WSJ.com: Bankruptcy Beat
(posted 23 hours 34 min ago)
Downtown Detroit
Paul Sancya/Associated Press

Wayne State University is trying to pull college kids who are home in Michigan for the summer into the heart of Detroit with a new class about the city’s quest for financial redemption.
College officials are advertising the 13-week class, “Detroit: Metropolis in Transition,” both to their own students and to students at other universities who want to take a summer class. It’s a good opportunity, they said, for the school to pull outsider students into the heart of the 700,000-resident city, which filed the largest municipal bankruptcy in U.S. history in July.
Detroit officials have blamed the city’s financial problems on the loss of residents who fled in large numbers for safer suburbs and took their tax dollars with them. But the 28,000-student school is still rooted in downtown Detroit.
“It’s really booming,” said college spokesman Mike Brinich.

WSJ.com: Bankruptcy Beat
(posted 1 day 48 min ago)

A recap of the informed opinions (and the discussions they generated) on BankThink this week.

BankThink
(posted 1 day 2 hours ago)

In no particular order, here are my Top 5 favorite references (overt or implied) to bankruptcy law in pop culture:
1.  Michael Scott “Declares” Bankruptcy
Filing a petition might be easy, but it’s not this easy…

2.  Homer Simpson’s Company Animotion Declares “Super-Duper Bankruptcy”
Kent Brockman: “Turning to the stock market, animotion is up an eighth…”
Homer: “Yes!”
Kent Brockman: “After plunging 75 points this morning.”
Homer:  “I hope plunging means up, and 75 means 200.”
Kent Brockman: “The firm declared super-duper bankruptcy. Which is terrible news for the company’s only stockholder…”

3.  Conan O’Brien’s Parade of Offensive Stereotypes Laments Sbarro’s Chapter 11

4.  It’s a Wonderful Life — Bailey Building & Loan

Creditors' Sidebar
(posted 1 day 2 hours ago)
In this Tuesday, April 15, photo, Homeland Security Investigators raid telecommunications and marketing firm TelexFree in Marlborough, Mass.
Alan Jung/Associated Press

The Securities and Exchange Commission has filed charges against a Massachusetts telephone marketing company for allegedly running a pyramid scheme that targeted primarily Dominican and Brazilian immigrants. Read the DBR article here.
(Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”)
Mt. Gox suitors are launching a last-ditch effort to revive the bitcoin exchange after it said it would move to liquidate, WSJ reports.

WSJ.com: Bankruptcy Beat
(posted 1 day 2 hours ago)