Oak Park Real Estate & Estate Planning Blog

Consumer bankruptcy can be an extremely useful tool for debtors who are struggling with a wide range of debts, from medical debt and credit card debt to mortgage debt. Yet at the same time, bankruptcy is not necessarily the right choice for everyone. Given the complexity of the bankruptcy process and the different types of bankruptcy and eligibility requirements for consumers, it is always important to discuss your case with an experienced Oak Park bankruptcy attorney who can assist you. In the meantime, who should be thinking about the possibility of filing for bankruptcy? A recent article in Business Insider considers when debtors should be thinking about bankruptcy and when they should be thinking through other options. We can tell you more about bankruptcy and whether it might be helpful to consider its benefits given your particular financial circumstances. You Do Not Have Obvious and Clear Options for Repaying What You Owe Most often, bankruptcy is appropriate in situations whe...

When consumer debt rises, rates of consumer bankruptcy filings frequently will follow — especially when Americans are taking on more debt than their income and assets will allow them to repay. According to a recent report from CNBC , consumer debt has now reached an all-time high, and delinquencies are also rising. As consumer debt and delinquencies go up, foreclosure and bankruptcy rate increases certainly could follow. Our Oak Park consumer protection lawyers want to discuss the data with you and provide you with more information about how bankruptcy can allow you to discharge common types of consumer debt. New Record High for Consumer Debt Combined with Rise in Delinquencies Consumer debt has now reached an all-time high, as CNBC reports. Indeed, by the end of 2022, “debt across all categories totaled $16.9 trillion, up about $1.3 trillion from a year ago.” Mortgage debt increased while refinancing rates declined. Mortgage delinquency rates also rose, suggesting that more foreclosu...

When you are considering personal bankruptcy and some of your debt is tax debt, it is critical to understand that tax debt is not like other types of consumer debt when it comes to bankruptcy. To be sure, there are only specific circumstances in which you can be eligible to discharge tax debt, and only particular types of tax debt can be discharged in a consumer bankruptcy case. The following are three important things to know about tax debt and consumer bankruptcy. If you have additional questions or need assistance with your case, you should reach out to a Chicago consumer bankruptcy lawyer. 1. You Should Not Assume Your Tax Debt is Dischargeable in a Consumer Bankruptcy Case If you have tax debt and you are planning to file for Chapter 7 bankruptcy or Chapter 13 bankruptcy, you should not assume that your tax debt will be dischargeable. As the Internal Revenue Service (IRS) explains, bankruptcy can be an option to discharge tax debt in some circumstances, but not all tax debt ...

With jobless claims hitting a record-high in the United States as a result of the coronavirus pandemic, experts are anticipating that consumer bankruptcy filings are likely to increase significantly. As an article in The New York Times explains, the financial crisis of 2008 resulted in the loss of approximately 26 million job-loss claims beyond the average level of about 345,000. Now, with the coronavirus pandemic, the number of people without jobs could far exceed the rate of joblessness during the financial crisis. Further, job loss as a result of the coronavirus is happening at a much faster rate. As of April 2, 2020, jobless claims have reached a total of more than 6.6 million just since the previous week. To put that number in perspective, prior to this past week, the highest recorded number of unemployment filings in a single week was 695,000 in the year 1982. As more Americans are without a paycheck and unable to make credit card payments or payments on medical bills, cour...

When you file for Chapter 7 bankruptcy or Chapter 13 bankruptcy , you are doing so because you have substantial debts and ultimately want to have those debts discharged. For many debtors, it can be confusing to understand how and when a discharge occurs, and what types of debts are not eligible for discharge. The U.S. Courts provide important information about bankruptcy discharge, and we want to go over some of that information for debtors who are considering consumer bankruptcy in Oak Park . How Does the Law Define Bankruptcy Discharge? What is a bankruptcy discharge? In short, it is a wiping away of debt. Bankruptcy discharge is a term that refers to a situation in which the debtor is released from his or her personal liability for certain debts incurred. To put it another way, a bankruptcy discharge means that the debtor does not have to pay for any of the debts that are discharged, and the creditors cannot seek to obtain any money owed on the debt once it is di...

Nobody in Oak Park wants to think about the prospect of a spouse’s death and how it will affect their lives emotionally, psychologically, and also financially. However, some couples need to consider such issues due to health concerns, or because they are thinking about filing for bankruptcy . We want to address some of the ways in which a spouse’s death can affect personal bankruptcy proceedings. For example, if a couple has thousands of dollars of debt that has been accrued by only one spouse, does that debt go away upon the spouse’s death? If a couple files for Chapter 13 bankruptcy together and one of the spouses passes away, how does the court handle that Chapter 13 repayment plan? We will discuss a couple of different situations that can arise when married couples accumulate debt and file for bankruptcy. Marital Debt and the Consumer Bankruptcy Option A recent article in the Los Angeles Times posed this question: What happens when one spouse has a termina...

Attorney General Lisa Madigan’s Office drafted the Illinois Student Loan Bill of Rights (SB 1351), which was sponsored by Sen. Daniel Biss and Rep. Will Guzzardi. We discussed the legislation with you back in May when the proposed legislation went through the Illinois state legislature. The bill was designed to prevent unfair debt collection practices and abusive loan collection tactics . However, according to a recent press release from Madigan’s office, Illinois Governor Bruce Rauner has vetoed the bill. What does the Attorney General’s office have to say about this? What does the veto mean for student loan borrowers in Oak Park and throughout Chicagoland? Reasons for the Student Loan Bill of Rights As many Illinois residents know, debtors across the state are struggling with student loan payments. The press release highlights that student loan debt represents “the largest form of unsecured debt in the country.” Currently, there are more than 40 million borrowers t...

For quite some time, commentators and consumer protection advocates have voiced concerns about student loan debt . According to a recent report from CNBC , student subprime debt has risen drastically over the last year, contributing to the trillions of dollars of student debt throughout the country. As an article in MarketWatch explains, some student borrowers, especially those who took out student loans to pay for for-profit colleges, may be more similar than we might think to “homeowners who used shady mortgage products to finance their homes in the lead up to the housing crash.” Indeed, “borrowers who took out student loans to attend for-profit schools defaulted at the same or higher rate within five years as those with subprime mortgages.” Now that the numbers reflect a surge in student subprime debt, what can we expect for borrowers who owe money on these loans? Is personal bankruptcy ever an option for student loan debt? Student Loan Debt Rises While Creditw...

Many consumers borrow money to pay for automobiles. For Oak Park residents who rely on their vehicles for transportation to work in Chicago and the surrounding area, it can be extremely anxiety-inducing to fall behind on their car payments. However, many Americans simply do not have the requisite savings to pay for an emergency situation and to continue paying monthly bills. For instance, if a medical emergency arises, many consumers prioritize those payments over auto loan payments, especially if someone in the family is in need of life-saving treatment. Sometimes consumer bankruptcy may be the best option. According to a recent post from the Consumer Financial Protection Bureau (CFPB), getting behind on your car payment does not always result in repossession. In some cases, filing for personal bankruptcy may allow you to discharge medical debt and to get back on track for paying off a car loan. Reduce the Risk of Falling Further Behind on Your Car Payment The...