Bankruptcy Effective & Simple! Rated a top Louisville Kentucky Bankruptcy Attorney and Foreclosure Lawyer
Gather Your Documents
The below link sends you to the list of the documents you must provide to the Court and explains what Trustees look for. We scan them into pdf format or you may upload them in your intake. Gathering documents takes about 2 hours if you already have them.
Fill Out Your Intake
The below link allows you to easily and accurately complete an intake from home. It emails you a link to your own personal intake questionnaire. If you have complete documents you may be able to file your bankruptcy in one trip!
Email me the Link
Take Your Counseling
You cannot file a bankruptcy without first attending a "credit counseling" course and getting the certificate. To finish a bankruptcy you need the second “debtor education” certificate. The below link goes to a page describing the 2 best places!
I personally prepare your petition. We prefer appointments at 9, 11, 1, and 3 with evening and weekend appointments under special conditions. To prepare your petition we need your income information. It can be done before you take counseling.
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Free Financial Peace University Bankruptcy Edition for our clients!
Our Practice is Limited to Foreclosure, Bankruptcy and Debt Defense.
Former Tax Assistant Attorney General & Assistant County Attorney
Rated A Top Louisville Bankruptcy Attorney By People Just Like You!
I have known and known of attorney Nick Thompson for at least 15 years. In that time I have seen him and his practice of law evolve into that of the most knowledgeable and caring bankruptcy attorney I know. If you have a bankruptcy law question, or are faced with a foreclosure crisis of your own, Nick is your answer. Period. There just isn’t anyone better in the state, in my opinion.
Nick Thompson is one of those rare individuals that will go out of his way to make sure you are getting the very best service and support when you’re using his Firm. I’ve know him for several years now and am also a client. He did a great job for me and solved some big problems. I am very grateful for all his help. I would recommend him, without question, to any of my closest friends and relatives.
- How to file Bankruptcy
- Defending Foreclosures
- Chapter 13 or 7?
- Suing Collectors
- 725+ FICO score after bankruptcy
How to File for Bankruptcy a step by step list of what to do!
Just check off each step and get a great bankruptcy!
Don't just file a petition and hope it turns out ok. This is an important opportunity and life changing event. I strongly suggest you take 3-4 hours to read our guide the “How to File Bankruptcy Manual”. The bankruptcy process has a lot of tricks and traps. If you understand the process you will have fewer problems. Bankruptcy is just like a marriage, school or a job. You get out of it what you put into it. By taking additional time to learn about bankruptcy and using a qualified attorney you can have a budget which includes retirement, a great credit score and a nice mortgage.
We take about 2 hours to prepare your petition and it is very similar to preparing your taxes. Nick personally prepares your petition with you and many people are able to prepare the petition in one trip if you know which Chapter you need. There are specific sections on our website about Chapter 7, Chapter 13, lien avoidance, tax, student loans and foreclosures.
When, where and how you file will save thousands of dollars and prevent losing property. The process is designed to catch fraudulent improper transfers and undervalued property. What Chapter you file, and how you file is a part of proper planning. Timing your bankruptcy or filing the right bankruptcy chapter is not fraud.
1: Credit Counseling
You are required to complete credit counseling before you file the petition. Credit counseling only takes an hour. After you get the credit counseling certificate you must file for bankruptcy within 180 days or retake the counseling. We have researched providers and recommend the two best. They deliver certificates quickly, reliably and bkcert is open 24/7. The normal fee is $50.00 but services go as low as $10.00. If you are poor, providers are required to reduce or waive the fee. Our services automatically file debtor certificates.
2: Filling out the Intake
Every office has an Intake form to fill out. Our online intake emails your own account where you sign in to list your debts, property and budget. This takes about 2-4 hours largely depending on how much property and debt you have to list. The intake is designed to let us accurately prepare your petition quickly in the office. The intake also lets us know your expenses and transfers you have made.
You may want to file a Chapter 13 to take advantage of the additional tools which allow you to strip a lien or handle difficult debts such as foreclosures, student loans and taxes. A Chapter 13 will also allow you to save a home from foreclosure better than a Chapter 7. Chapter 7 is quick and cheaper but may not cure some difficult debt problems. The intake helps us review your budget so you can qualify for the Chapter 7 or 13 that is best for you.
3: Gathering your Documents
Documents. have to be provided to the court in Adobe PDF format. You may provide documents to us by uploading them on your intake or by bringing them with you on a thumb drive or sd chip. The credit counseling certificate is normally sent to us by the course provider. You may make copies of the documents and bring them in to us. We can scan and convert paper documents into pdf format for the court. However, when you download paychecks or bank statements they are normally already in a pdf format so why print them?
The system is designed to help deserving debtors that need help or a fresh start. Over 99% of debtor have little or no assets for the court to take and no disposable income to afford repayment in a Chapter 13. These documents are used by the Trustee and the Judge to prove you have no major assets or income to repay your debts. Preparing an accurate petition with supporting documents insures they can do their job in minutes. Each petition is checked by government accountants who are trained to spot fraud. Making their job easy guarantees your bankruptcy will be processed quickly.
4: Get your Additional Benefits
Cheaper attorneys tend to just file the bankruptcy. After you file the bankruptcy you may be able to profit from special additional benefits, and discharges. You don't get these benefits automatically. They require extra work and you have time limits to apply for them. You may need to strip a judicial lien if you have been sued. You may be able to eliminate your second mortgage, or redeem your auto. You don't get these benefits unless you plan and work jointly with your attorney to get them. These additional benefits save you thousands. In some cases you may reduce your mortgage payment or eliminate your student loans. Be sure to read the manual so you understand the available options or you will lose them by not applying for them.
5: Hearing 341 Meeting of Creditors
After we file the petition the court assigns a Trustee to your case. A 341 Meeting of Creditors hearing is held about 4-6 weeks after the case is filed. In a Chapter 13 a Confirmation hearing is also held. In the Western District of Kentucky, it is held at the same times as the Meeting of Creditors. In Indiana and the Eastern District, it is held on a later date. The common questions you will be asked in court are under the bankruptcy tab.
The Trustee makes about 60-70 dollars for reviewing your petition. Being accurate and having the documents ready makes it easy so he can go on to the next case. He is also responsible for finding hidden assets, forcing persons who have the ability to repay into Chapter 13 and dismissing inaccurate petitions. If he can review 10 cases an hour he can make 600 per hour. If you take up his time due to an inaccurate petition or being difficult he is not happy.
The Trustee will ask questions to determine if you have any large assets that can be sold to pay creditors. The Kentucky and Federal exemptions are large and it is rare for anyone to have a large amount of equity in real property (over 50,000 for a couple) or a car. He will also review your income to see if you should convert to a Chapter 13, for fraudulent transfers and if he should object to your discharge.
6: Financial Management Course
Last you have to complete an educational ''Financial Management Course.'' You must complete this course if you want the discharge which is the permanent court order that protects you from creditors. This second 2-hour course is about $50. Again there are reduced fees available for the poor. You should take this course as soon as your case is filed and you know the case number. Both the providers we recommend will automatically file it. The failure to file this certificate means you will not get the discharge. If you forget to file the certificate the court will require a new filing fee (335 in 2016) and the attorney will charge for his time to file the motion to reopen the case and file the certificate (about 300). Every year someone forgets to take this second course.
7: Credit Repair and Financial Peace University Bankruptcy Edition
We do offer credit repair after your bankruptcy. You can rebuild your credit score after bankruptcy quickly. Your score should be back as good or better within 12-24 months. Lenders categorize you as someone that has used bankruptcy to recover and those that haven't changed having budgeting and financial problems. Our services simply and effectively help you to improve your score. In Feb 2016 we will also offer a shot course on how to rebuild your score to above 700 in 7 steps after bankruptcy and get a home within 2 years.
We have teamed with Dave Ramsey to offer free tuition for you in a special version of his Financial Peace University Online Bankruptcy Edition just for bankruptcy filers. We want you to be financially successful after you file. You can do both if these whether you file with us or not just by looking up the information on our website. We have the webpages and blog information for you. Please use the magnifying glass on the upper right to search our website for specific topics like how to manage income taxes, student loans etc.
- Get the best attorney you can afford. In a Chapter 13 the court pays every attorney the amount unless he itemizes his fee. Don't get the worst attorney when you could have had a great one for the same price.
- Buy his ability and expertise not his politics or office décor. Better attorneys may lack bedside manners but may save your home. If he is a little aggressive with clients he may also be aggressive with the bank.
- Get a lawyer who specializes in bankruptcy law. This is not an easy area of the law. When the code changed in 2005 about 50% of the attorneys practicing bankruptcy quit because it became too difficult. In 2015 the forms became even more difficult and over 25% closed their offices. In California over 96% of the persons who attempt to file a Chapter 13 on their own have their cases dismissed. This isn't easy.
- The average case takes about 8-10 hours of an attorney's time. Qualified attorneys can't spend 4 hours or more preparing your case if they file more than 20 cases a month. Large firms which file 1000+ cases a year use junior lawyers and paralegals to prepare petitions. The result of large firm mills is you are handed off to younger attorneys and don't get this level of service and planning you may need.
Foreclosure Defense what should I do?
When I analyze a foreclosure I analyze the mortgage just like a bank. The decision to keep a home is just a financial decision. Never allow emotions to influence whether you keep to surrender the home. Either the home is a good deal or it isn’t. You normally want to save the home if it:
- meets the family needs,
- is at a reasonable interest rate and
- is worth more than the mortgage
A lender will often process a foreclosure while they talk about mortgage modification or a workout agreement to cure the arrearage. This is called dual tracking where the servicer processes the foreclosure while offering you an alternative. The servicer collects benefits from the government or from mortgage insurance for offering these benefits while they foreclose.
If you are served with a foreclosure you should either file an answer and defend the foreclosure or file a Chapter 13 bankruptcy immediately to save the home. You only have 20 days to file the answer and you can lose the lawsuit by failing to defend it. It is possible to sell a home and have a homeowner evicted in Kentucky in just 90 days. I have also seen it take over 14 years when a homeowner effectively defended the foreclosure.
About 95% of the people that apply for a modification never get it. The servicer is just a debt collector who works for the lender. The servicer is paid for every letter, phone call and late fee collected. The lender rarely collects a mortgage. If you find it hard to work with the servicer remember he makes a profit from servicing overdue accounts.
Surrendering your home
If the home isn’t a good deal then the home probably must eventually go back. By using a qualified attorney and filing a proper answer and discovery the home may not go back in foreclosure for years. The homeowner normally stays in the home rent free. At the end of the process and just before the sale, the homeowner will almost always file a Chapter 7 bankruptcy to insure there is no deficiency balance to pay back or tax debt from a 1099-c. Filing the Chapter 7 bankruptcy just before the sale will often give the homeowner an additional 6 months. It is even possible to file one case in the husbands name and immediately after that six months file a second case which will delay the sale another 6 months. Filing a bankruptcy or a foreclosure defense does not or should not affect processing a mortgage modification or workout.
Saving your home
If you want to save a home then you normally want to file a Chapter 13 to catch the payments up. The sooner you file the Chapter 13 the more affordable the payments will be. Every day the case is litigated more attorney fees stack up. The sooner a Chapter 13 is filed the sooner these fees and charges are stopped.
It is possible to work with the bank to modify a mortgage or do a workout agreement while you are in a Chapter 13. However there is no guarantee that a homeowner will get a mortgage modification just by applying for it. Over 95% of the mortgage modifications applications fail to be approved. Even if your mortgage modification is approved the new loan may have worse terms. If you are facing a home foreclosure come in for a free consultation and assessment.
Chapter 13 or 7 which Chapter should I file?
The court rewards people who repay and file a Chapter 13 bankruptcy with a broader and more powerful discharge. A Chapter 13 is the tool to cure a foreclosure. It allows you time to catch up the payments and perhaps eliminate a second mortgage. A Chapter 13 has additional tools that allow you to manage income taxes, secured debts, foreclosures, repossessions, student loans and priority debts much better than a Chapter 7. Stripping a second mortgage or cramming down a car loan is possible in a Chapter 13. These tools are only available in a Chapter 13 . Look at the section on Chapter 13 to see all the tools it has.
- The drawbacks to a Chapter 13 are the cost over time, the time it takes to obtain a discharge 3-5 years, and the lower success ratio for people that file a Chapter 13 (about 70% of Chapter 13 cases fail due to debtors who quit paying).
- The discharge is broader and more complete in a Chapter 13. Your property is safe in a Chapter 13 from a Trustee taking it. You can voluntarily quit (dismiss) a Chapter 13 and you can protect a co-maker. Since the stay lasts for 3-5 years it can protect you for a long period of time from private student loans or multiple collectors that could garnish an entire paycheck.
- If you are worried about losing property in a Chapter 7 you can always convert from a Chapter 13 to a 7 if Chapter 13 doesn't work for you. You cant convert easily from a Chapter 7 to a 13 to prevent a Chapter 7 trustee from selling property.
Why should I file a Chapter 7
- A Chapter 7 is normally the best tool if you have minor assets, a small income and a majority of unsecured debt. If you have filed a Chapter 7 bankruptcy within the prior 8 years or if you have a very large income Chapter 7 may not be available for you. Over 90% of the people in America qualify for a Chapter 7.
- A Chapter 13 generates over twice the attorney fee that a Chapter 7 does. This may cause some attorneys to claim that Chapter 7 is not available to you. Even if your income is over the average over 90% still qualify. If your income is above average you may have to search for expenses in your budget to justify filing as a Chapter 7 but well over 90% qualify.
- Chapter 7 cases have over a 99% success rate at our office and get the discharge.
- A Chapter 7 is quick, simple, and cheaper if you primarily have unsecured debt problems.
There is some shopping around that can be done to get a cheaper legal fee in a Chapter 7. But you get what you pay for. Filing a Chapter 7 is just like using a tax expert. A mistake in the accuracy or how you plan a petition or tax return often costs thousands. After you make a serious mistake in bankruptcy you normally can’t fix it.
The Court pays each attorney the same in a Chapter 13. There is no reason to use an inexperienced or unknowledgeable attorney since fees in a Chapter 13 are paid by the court. Use the best attorney in town and forget shopping around if you are filing a Chapter 13.
Why file both a Chapter 7 and a Chapter 13 (Chapter 20) or separate cases
- If a person files a Chapter 7 first and then files a Chapter 13 he eliminates the unsecured debt before the Chapter 13 is filed. The result is nothing should be paid back to unsecured creditors in the Chapter 13. The Chapter 13 becomes much more affordable. In effect the Chapter 13 becomes a zero percent plan with a very small payment and no discharge but it stills stops the foreclosure and save a home.
- If you need to save a home, have a lot of unsecured debt, and don’t need to strip a second mortgage then a Chapter 20 allows you to save the home with a more affordable Chapter 13 and avoid paying the unsecured creditors a penny if you qualify for the Chapter 7.
- Filing separate cases in your name and then a spouses name may delay a foreclosure longer than filing just one case. If you need the additional time to find a home this will give an individual a little free rent and time.
Suing Debt Collectors
We sue banks and the Debt collectors that violate our clients. We often advise our clients who file bankruptcy with us to download the record all calls application for their iPhone or android phone. It is difficult or impossible for a debt collector to be honest and respectful in a collection phone call. When the debt collector becomes abusive, violates the bankruptcy stay, or makes an untrue statement the debtor has a right to sue under the FDCPA or for contempt under the bankruptcy code. A Debtor should also have a sheet to record the date and times whenever someone contacts them to collect a debt after a bankruptcy case is filed.
These phone calls and the records allow an attorney to sue for damages. The minimum damages under the FDCPA are 1000 dollars. Other statutes allow up to 1500 per phone call. But without the recorded phone calls and the paper records these debt collectors will often claim they never made the call. Both the FDCPA and the contempt powers of the bankruptcy court allow you to collect attorney fees besides actual damages. Sometimes punitive damages are proper and allowed.
Usually the debtor will make more from these damages than what the bankruptcy attorney charged for the bankruptcy case. But filing a case requires that you gather the evidence. Normally if the bankruptcy was just filed yesterday the lender may not have gotten notice in the mail. But when the lender is advised you have filed the lender must stop. The lender should never make a second and third call.
After the lender has found out that you have filed bankruptcy the lender cannot request you pay the account. But the lender can accept payment from a debtor or may send a billing statement to let you know the payment history and balance. By gathering the phone calls and the letters you were sent you gather evidence to prove these are attempts to collect and not just a billing statement. We will often allow a secured creditor to call a client to find out whether a client wishes to keep a car or not. We never agree to allow an unsecured creditor to call a client.
How much can this mean for a client? In one case it meant 18 million dollars where a history of lying, disrespect and violations was the proven standard office practice in a large collection firm. In our office we don’t tolerate intentional violations. We don’t even give a first warning. We worked for the banks originally. We know they believe that if they get away with it once they will continue to do it until it is no longer profitable. They don’t care if it is illegal. The only way to stop them from committing fraud, violating the law and being disrespectful is to sue them until it hurts badly enough they never do it again.
Debt collectors are ashamed and embarrassed when caught. Often a supervisor told the employee and supervised him in lying and violating the law. Catching them in the act and proving it in court before a federal judge damages their image with that judge and they will pay to hush prosecution. Often these cases are never heard. The reason to record your calls without the bill collector’s knowledge and to keep paperwork is because without the evidence the case is impossible to prove.
What does Bankruptcy cost?
The Chapter 7 filing fee is 335. The Chapter 13 filing fee is 310 but we have mailing costs so both Chapters run 335 for filing. Chapter 13 attorney fees are set by the court. Every attorney is paid the same. Always hire the best attorney in a Chapter 13 you can find. There is no reason to hire the worst attorney you can and pay the same price you would have paid for a better attorney. Chapter 7 cases: The average attorney fee in Louisville Kentucky area runs about 1200 for a single and 1400 for a joint Chapter 7 petition. The attorney fee for Chapter 7 can vary based on how complex or difficult a case is. Cases that involve a business, large assets and creditors will cost more for the extra work. You can shop for a cheaper attorney. It will normally cost you more because you will get less in services. There are two “classes” which cost from 10 dollars to 50 dollars. If you are poor the fee can be waived or reduced. Be sure to file the second course with bkcert. They reliably and automatically file the second certification. The failure to file the second course on time can cost you over 600 dollars so you don’t want to trust anyone else.
Is it required that my spouse file with me?
No. There is no rule which requires a spouse to file with you. However, in computing the means test we do need your spouse’s income and expense documentation to calculate the means test. In some cases, there may be an advantage to filing two separate cases especially if you are surrendering your home in foreclosure.
Will bankruptcy stop creditors from calling me?
We sue creditors. If they disobey the court orders it means you can sue them for damages. This is why we ask clients to record calls. The moment you file there is a temporary court order called a stay that forbids creditors from contacting you for payment. At the close of the case you get the permanent court order called a discharge which permanently stops collection. Immediately upon filing Creditors are forbidden to continue collections. If they continue to attempt collection, we file lawsuits against the creditor. There is no cost to you, and the money we collect is often more than what you paid to file your bankruptcy.
Will my credit be ruined for years to come?
A foreclosure does more harm to your credit than filing a bankruptcy. A lawsuit for collection can lower your FICO score more than the bankruptcy. As a part of your bankruptcy we provide a credit sweeping service and Dave Ramsey’s Financial Peace University for Bankruptcy filers. We don’t just shove you out the door after you file. We provide detailed instructions on how to get a 700+ score. Most clients have their credit back on track within one year and can buy a home 2 years after discharge. A foreclosure takes 3 years.
Will I lose my car or home?
Kentucky uses the Federal Exemptions. You can keep up to about 25,000 in equity in a home for every person on the deed. You can also keep at least 3500 in equity in a car. If you don’t own a home, one-half of the homestead exemption can be used to keep any other property as a wildcard exemption. There is also a household exemption for furniture that is so large we have never had anyone exceed it. Indiana uses it’s own state exemptions. It is still rare for someone to lose property in Indiana but tax refunds and money in the bank are often lost because the intangible property exemption is only about 350. Exemptions tend to increase every year with the cost of living.
Is filing bankruptcy complicated?
Filing for Bankruptcy does not have to be complicated. We just need your last two tax returns, last six months of paychecks, bank statements, car titles, and a list of the debts with amounts and addresses. You can save time and trouble by filling out our online intake at home. You also have to take two online webinar class which last about 1 hour for the first course and 2 hours for the second to complete the bankruptcy. There may be other receipts or documents, depending on your income, property and any transfers you have made. We have the experience to successfully handle this process so that you remain stress-free.
If I have filed bankruptcy before, could I file again?
Yes, but there are time limits to how often you can get a discharge. A discharge order forbids collection by most of the creditors. Child Support Student loans and recent income tax debts are often not discharged. You have to wait 8 years from the date you filed your first Chapter 7 and got a discharge before you file a second Chapter 7 and get a discharge. If you don’t need another discharge you can file a Chapter 13, the day after your Chapter 7 is discharged. It is possible to get a Chapter 13 discharge every two years.
Why file a Chapter 13?
There are advantages to filing a Chapter 13. You may need to stop a foreclosure even if you are ineligible to receive a discharge. A Chapter 13 can handle debts a Chapter 7 can’t. But if all you have are unsecured debts, a small income and a small amount of assets a Chapter 7 may be best for you. We can help you sort out the time limits and whether a Chapter 7 or 13 is best for you.
Call us today (502) 625-0903(502) 625-0903
725 FICO Credit Scores and Prime Mortgages after Bankruptcy
This is the short version of a longer and more complete article you will find under the bankruptcy tab about how you can recover and have a 725 credit score or mortgage with a prime lender after a bankruptcy or foreclosure. With a 725 score lenders compete for your business. Bankruptcy may actually clean up your credit.
Bankruptcy does not have as great an impact on your credit score as a foreclosure or remaining in default. Many bankruptcy clients obtain a 725 or higher FICO Credit Score within a year after Bankruptcy when they follow these rules. Regulations require you wait 2 years after a bankruptcy discharge to get the best rates for a FHA, HUD mortgage and 3 years after foreclosure.
To keep you as a customer predatory lenders want your score to remain low. Buy here pay here car lots do not report on time payments to keep you coming back. Some credit card companies also work to keep your credit scores low by not reporting your true limits. Subprime mortgage lenders pay higher commissions to mortgage brokers, car finance managers and even school financial aid officers for selling you higher rate loans. Customers are often lied to by loan officers who could have gotten you better loans, because they made higher commissions from the bad loans. With a 725+ score you leave this behind for lenders who compete for your business.
There are five major variables which improve your FICO and qualify you for a mortgage:
- A mixture of credit you want different types of credit to show you pay regardless of what kind of loan you have. Obtain 2-3 revolving (credit card or department store) accounts and 1 installment account such as a car loan and pay on time. This is 10% of your score.
- Inquires Don’t be desperate for credit. Multiple inquiries damage your credit. Inquires account for 10% of your score. Check the accuracy of your credit report. 40% of all reports have errors that would deny you a mortgage.
- Account Age How old your accounts is an important factor. The depth (age) of your credit history accounts for about 15% of your FICO score. Skipping from one lender to another for those teaser rates destroys this account age. A history of on time payments with Chase for 15 years has more impact on your score than being with Capitol One for the last 6 months. Paying a collection is generally bad for your credit report for the same reason. Overall it makes the collection a more recent reported item and encourages other collectors to renew collections.
- Low 30% Balances You want high limits on your cards. Keep accounts active but have low balances. Don’t pay them off completely. Many cards have a low or no monthly or annual fee. It is important to have your credit cards report your limits and target your balances to be below 30%. Having low balances on your accounts and not over utilizing them accounts for another 30% of your score. A small balance also won’t cost you much in interest or fees. Each card should have a 30%. Don’t charge one for 100% and have two inactive dead accounts with 0 balances.
- Payment History Paying regularly and on time accounts for 35% of your score. One late payment or mistake will not kill your FICO score but it can deny you a mortgage. But not paying on multiple accounts recently will destroy your score and drop it 100 or more points. The older the item, the less effect it has on your credit. If a bankruptcy drops a score 100 points in the first year is drops it about 50 in the second year and 25 in the third year. Establish a history of on time payment by making automated payments with your accounts. If you cant get a mortgage due to a student loan in default then look at rehabilitating the student loan to get the mortgage.