Attention – Those considering bankruptcy or divorcing someone who might choose bankruptcy…

Are You confused by all the conflicting information out there surrounding your rights in bankruptcy?

·         Are credit worries keeping you awake at night?

·         Would you like to get a fresh start, but don’t know how?

·         Do you want to protect yourself from your creditors?

·         Do you want to protect yourself from your spouse’s credit issues?

If you answered yes to any or all of these questions then you don’t want to miss this teleconference:

“Bankruptcy Basics and How to Avoid Being Burned in Divorce!”   

Wednesday, February 25th, 2009
7:00pm EST (USA)

This month’s guest is Christine Stadler, divorce and bankruptcy attorney in the metro Atlanta area.  We are offering this free teleseminar for the credit challenged so that you can be educated and armed with useful tips, tactics and tools to help you manage and survive your bankruptcy or the bankruptcy of your ex-spouse! 

During this Teleseminar, we’ll be discussing…

• What are the different bankruptcy options available and how does someone qualify for each?
• When does it makes sense to file bankruptcy and when not?
• What are the most important secrets you must know to avoid getting burned when it comes to divorce and bankruptcy?
• What 3 things can you do TODAY to protect yourself from bankruptcy problems pre and post divorce?
• What your decree must say BEFORE you sign on the dotted divorce line to protect you if your ex files for bankruptcy?
• How to prevent your credit from being ruined if your (ex) spouse files for bankruptcy?
• Creating a clean slate after bankruptcy  - now what?
• Special tips for those contemplating, in the process of, or post-divorce.
• And much, much, more….

To register go to my events page - Bankruptcy Basics to sign up now!

http://tinyurl.com/b4azu3

Estate Planning and Divorce - Tips on Trusts for the Family Law Attorney

March 10, 2008   Massachusetts Estate Planning and Elder Law by Leanna Hamill, Attorney at Law. 

Here’s a great article with information on bankruptcy and it’s effects on divorce. For more information on bankruptcy and divorce issues, don’t miss my next teleseminar this month, “Bankruptcy Basics and How to Avoid Being Burned in Divorce" with Christine Stadler, divorce and bankruptcy attorney.  February 25, 2009 7:00 pm.  Details for sign-up to be posted soon.

Bankruptcy During Divorce (posted at Lawyers.com)

by Sherrie Bennett

If you think you’re headed for divorce and have a lot of debt between the two of you, it might make sense to file for bankruptcy before starting a legal divorce proceeding. Filing bankruptcy first can simplify the divorce by clearing out some of your debt. This can make it easier to negotiate how the remaining debts should be divided, and protect you from your soon-to-be-ex’s bankruptcy filing down the road. Also, you and your spouse might want to consider filing a joint bankruptcy before the divorce. Not only will this make the final division of any remaining debts even easier, but filing a joint bankruptcy is cheaper than filing two separate ones. In either event, bankruptcies and divorces have serious impacts on each other, especially with respect to your property and personal finances.

Effect of Bankruptcy on Divorce

When one or both spouses file bankruptcy, all the community property, that is, property that was bought or acquired during the course of the marriage, becomes a part of the bankruptcy estate and is available to pay debts. The bankruptcy estate is simply all of your property that you own at the time the bankruptcy is filed.

When you or your spouse file a bankruptcy, an automatic stay immediately prevents creditors from collecting on most debts. But the automatic stay doesn’t prevent you from asking a divorce court to order your spouse to pay child support or alimony. Once a bankruptcy court decides property is "exempt," that is, it is not part of the bankruptcy estate and so it is not available to be sold to pay debts, a divorce court can then divide that property.  Property exemptions are defined not only by federal law (the "Bankruptcy Code"), but also by the laws of the state in which the bankruptcy is filed.

Some examples of federal exemptions include:

    * A specified dollar amount for real property that is for his or her residence, and

     * A specified dollar amount for one motor vehicle, such as your primary car.

Property Settlements and Bankruptcy

Negotiating a property settlement in the midst of bankruptcy is complicated. Debts related to a property settlement are presumed to be "nondischargeable" in bankruptcy, meaning that the person who files bankruptcy can’t have those debts wiped out and must still be responsible for them.

But the bankruptcy court will wipe out those debts if the person filing for bankruptcy can show:

    * That he or she can’t pay the debt and still take care of him or herself and any dependents, or

     * That wiping out the debt would result in a benefit to the person filing the bankruptcy that outweighs any harm done to his or her former spouse or child by nonpayment.

So if you think your spouse is contemplating bankruptcy after your divorce is final, you’ll want to word your property settlement in such a way that your soon-to-be-ex’s obligation looks and acts as much as possible like a support obligation instead of a property settlement. That is so simply because support obligations are more difficult to have discharged.

How do bankruptcy courts decide what’s support and what’s property settlement? It varies greatly by state, but courts have based their decisions on such questions as:

    * Does the obligation terminate or reduce with the occurrence of certain events, like remarriage or a child turning 18?

    * Is the obligation in installments or a lump sum?

     * Are there minor children? * What is the relative health and education of the parties?

    * Was there a need for support at the time of the divorce?

If your bankruptcy hasn’t been filed yet, these distinctions and problems probably won’t effect you. For many bankruptcies filed on or after October 17, 2005, any obligation between former spouses can’t be dischargedin bankruptcy. So, a spouse with an alimony and/or child support obligation can’t have that obligation discharged in bankruptcy if the bankruptcy petition was filed on or after October 17, 2005.

Property Liens

One way to protect yourself in a divorce negotiation if you think your spouse may be contemplating bankruptcy in the future is to take a security lien as a backup to debts your spouse is to pay you after the divorce. The lien should be on property your spouse is to be awarded in the divorce, preferably property that means a lot to your spouse. That way, if your spouse later asks the bankruptcy court to discharge the debt he or she is supposed to pay, you can seize the property to pay the debt.

Indemnity Clauses

Another precaution in the face of a soon-to-be-ex-spouse talking about bankruptcy is to have a "hold harmless" or "indemnity" clause written into the divorce decree, requiring your spouse to pay certain debts or repay you if a creditor makes you pay the debt. If your ex-spouse later files bankruptcy, you can go to bankruptcy court and ask the judge to enforce the indemnity agreement. While an indemnity agreement won’t guarantee you’ll get paid, it’s one more factor for the bankruptcy judge to consider.

As you can see, the issues of going through divorce and bankruptcy at the same time are confusing at best, and highly damaging at worst. If you find yourself in this position, it makes sense to find a bankruptcy lawyer who can help you with all the issues.

This was posted on the Prescriptionforchange.org blog on Jan. 26, 2009.  It is very sad that we have come to a point that people have to go to such extremes just to get medical care.  My sympathies go out to Julie’s family.

Consumers Union’s Cover America Tour traveled the country this past summer documenting Americans’ experiences with our health care system. We met Julie in August 2008.

Julie found the love of her life on her second marriage to Gene. After 18 years together, Gene showed Julie how much he loved her by giving her a divorce.

Employed but uninsured, Julie was diagnosed with uterine cancer four years ago. She was able to get free care through a special program offered by the city of Spokane, Wash. But it was a temporary solution, and when the city could no longer offer her help, Julie called every program she could find so she could continue cancer treatments. They all told her the same thing: the couple made too much money.

By this point Julie was out on disability, too sick to work. But Gene, a cabinet builder, made about $100 a month over the limit to qualify for any programs. How would they survive if he actually tried to make less money? They were barely making ends meet as it was, especially with the mounting medical bills.

They finally realized that in order for Julie to financially qualify for a program to get treatment for her cancer, they’d have to do the unthinkable – get a divorce.

Julie and Gene went to the county courthouse to file the papers that legally ended their marriage, allowing Julie to finally qualify for Medicaid and receive treatment. “As we were going through the divorce process, we discovered that we weren’t alone,” Julie said. “There are many couples in the same situation. It is not right to force people to make the choice of ‘get a divorce or die’.”

While she and Gene were relieved that she finally had coverage, Medicaid came with its own pitfalls. They quickly learned that Julie had to reapply every six months, creating a never-ending stream of paperwork, applications, deadlines – and the constant worry that she might get rejected for filling something out wrong.

A cancer diagnosis is frightening and life-altering enough. Now add on the scramble to find coverage for treatment to save your own life, and having to divorce your spouse. As Julie put it, “And cancer patients aren’t supposed to be under a lot of stress…what a joke.”

But Julie was a fighter. She battled cancer for over 4 years and celebrated every day she had, speaking out for the need to reform our health care system so others wouldn’t have to struggle to get care the way she did. She volunteered her time with organizations that fundraise for cancer research, and she and Gene continued to take care of each other. After all, they were – in their hearts, if not on paper – still married.

Two weeks ago, cancer took Julie’s life. We send our deepest sympathy to her friends and family. She touched our lives, and she will be missed.

Her story illustrates the impossible dilemma so many Americans currently face trying to secure affordable, quality health coverage. You can take action for change at www.PrescriptionForChange.org

My colleague, Cindy Morus, has created a fabulous program, the Pay Debt Quickly system.  If you want some great ideas on how to get out of debt faster without any extra money out of pocket, then you must check out her program now!  And be sure to read the great tips below on what to do with your tax refund this year.

How to Have More Fun With Your Tax Refund in 2009 By Cindy Morus, Creator of the Pay Debt Quickly System

I counsel a LOT of people about money. I see the same mistakes being made over and over again. If you’ve made ‘em, don’t worry. I’m here to help you do it right THIS year!

The fact is, moneymakers need a money coach, just like gymnasts need a gymnastics coach. As your Money Mending coach, here are the mistakes in thinking and behavior I want you to avoid:

• Don’t think of your refund as free money - or lottery winnings. It’s not! That refund is your hard-earned dollars that you loaned Uncle Sam interest free - all last year.
• Don’t spend the refund - or OVERSPEND it - when you haven’t gotten the cash in your hands yet.
• Don’t spend the whole refund to pay down debt.

OK. So now you’re Money Smart about what NOT to do with that refund in 2009. Next, here are my EASY Money Smart moves that YOU can make to best handle your income tax refund this year.

First, divide your refund into thirds - 3 equal amounts. Why 3 equal amounts? Because we want to use that refund - however small or large - to handle the past, the present and the future.

Use one third to handle the PAST by paying down debts. Start with your most pressing debt…either the one with the highest interest rate, or the one with the biggest consequence for not paying it down.

Use one third for something you need or want in the PRESENT. If you can, use that money to have some FUN. Do something that is NOURISHING to you - something that makes you feel GOOD. How about a mini-vacation, or an evening of fine dining and great entertainment, or a day at the spa?  Of course, if the brakes on the car are shot, or you have some other pressing need, you’ll need to do that FIRST. 

Finally, use one third to handle some aspect of your FUTURE.

Here are several Money Smart suggestions for you to think about.

• Put money in your Anti-Emergency Fund.
• Put money in your Sleep EZ Fund or save for your retirement through your 401(k), 403(b), IRA (traditional or Roth).
• Put money into college education funds (Coverdell IRAs or 529 plans) for your kids or grandkids.

Why is this "thirds" approach such a great idea? Because you’ll be taking care of a variety of wants and needs - AND taking several easy Money Smart steps forward towards your BIG goal of financial freedom! THAT is how you can have MORE fun with YOUR tax refund in 2009.

Now is also a GREAT time to "check out your paycheck":

• Re-evaluate how much money you are contributing to your 401(k) or 403(b).
• If you got a whopping refund, remember you were just sticking YOUR money in Uncle Sam’s pocket. No point in giving Uncle Sam an interest free loan! Adjust your deductions so that you have just enough taxes withheld from your paycheck.

More Help from Cindy: Trouble with debt? Eliminate your debt and save your money using the Pay Debt Quickly System. It comes with the software and strategies you need get rid of your debt without making an large payments or making any significant lifestyle changes. Click here to learn more and get started right away or sign up for her free Powerful Debt Reduction Starter Guide.