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The HAVEN act and Bankruptcy

Do you ever wonder how bad rumors get started?  Bad headlines don’t help.

Congress is considering a new piece of legislation.  It’s called the HAVEN act.  The act will correct a problem that has existed since the 2005 overhaul of bankruptcy.  

If you are a veteran who receives disability income from the VA, that money is counted in your means test.  In other words, it counts against you in bankruptcy, whereas regular disability income does not. 

Frankly, that’s not fair. 

The HAVEN Act saves the day

That’s where the HAVEN act comes in.  

Chapter 7 bankruptcy is a liquidation bankruptcy (it’s what most people who are in big debt want) and it gets rid of all of your debts that are dischargeable.  The problem is, you have to qualify for a Chapter 7 via the means test.  

This military disability increases your total income, which in turn can cause your income to be so high that you are forced to do a Chapter 13 bankruptcy. 

The HAVEN act eliminates military disability income from the means test just like regular SSI disability and gives you a big boost.  

There is, unfortunately a lot of rumors going around about the current state of bankruptcy and military benefits.  

Misconceptions about the current system

 A reporter for the military times has stated that veterans who file bankruptcy under our current system risk having the benefits taken away.  He states “Bankrupt vets can lose their disability benefits.”

This is patently false.  

The current system allows the military disability benefits to be counted in the means test, but it by no means eliminates your disability benefits.  

All this means is that IF your income is high enough, it could cause you to have to do a Chapter 13 bankruptcy instead of a Chapter 7.  

But, I repeat, you do not LOSE your benefits.  You still get a check from the VA every month just like you always did and will continue to do for the rest of your life.  

If you file a Chapter 7 bankruptcy, the trustee can’t take your check from YOUR bank account. 

Additionally, the Chapter 13 trustee does not take them from you either.  They still go into YOUR bank account and you may have to use some of your disability money to make your Chapter 13 payment.  

While all of this may seem confusing, rest assured, as a bankruptcy lawyer, it’s my job to understand the nuances of the law and make sure you get the best outcome possible.  Trust me, I do and you will. 

If you’re a veteran who is concerned about your VA benefits and the bankruptcy process, call me.  I understand it a lot better than you may think (I actually work with veterans to get VA disability for them as well). 

We’re here to help, especially those who have worked so hard and sacrificed so much already.  

What does a Bankruptcy Lawyer Do for You?

I don’t work for free, at least not often.  After all, my kids have to eat too.  That said, you’re looking at filing bankruptcy because you don’t have much money, or any at all. So…What can I (a bankruptcy lawyer) do for you?

Lots of people think I’m just a paper pusher.  Don’t get me wrong, I do handle lots of documents but that’s missing the forest for the trees. So besides pushing paper, what does a bankruptcy lawyer do for you?

Assessment

As a bankruptcy attorney, it’s my job to determine whether or not bankruptcy is right for you.  Some lawyers will always say bankruptcy is right.  

That’s because they want your money and don’t really care about you. While I want to earn your business, I also need to sleep at night.  

The fact is, Bankruptcy won’t help everyone and if you’re one of those people, I’ll be honest with you.  I’d rather not have your money than lie to you to make a quick buck. 

Beyond the issue of ,”is bankruptcy right” there’s also the issue of timing.  

Is it the right time or should I wait a few months?

Should I file with or without my spouse?

Is Chapter 7 or Chapter 13 going to be my best bet?

How will my bankruptcy affect my family and business associates?

None of these so called forms can make those kinds of determinations, that’s where I come in. 

Avoidance

A good bankruptcy lawyer helps you avoid mistakes, sometimes big ones, when you’re completing your petition.  

Ill founded assumptions and bad choices can cause significant harm to your financial situation.  Got equity in your house you want to keep? Better not file Chapter 7. Get nuanced things like this wrong and suddenly you’re in over your head and face losing your assets. 

Speaking of assets, if you get the exemptions wrong, you may give up more than you have to, especially if you’ve moved recently.  

After you file, you have to provide paperwork like tax returns, pay stubs and other forms to the trustee.  Most of the trustees all have certain ways they want things submitted.

Whiff on any of these and your case may be dismissed. 

Understanding

Bankruptcy can be a challenging process and is fraught with potential landmines.  I’m here to explain how it works, what happens and how it will affect you.  

Bankruptcy is stressful without having to worry about what happens when you go to court and how the trustee will administer your case.  

A good bankruptcy attorney is able to anticipate what’s going to happen and explain the process to you in a way that makes you feel comfortable. 

Finish the Drill

Filing for bankruptcy is the easy part.  It’s the rest that starts to get hairy.  If you left a creditor off your bankruptcy or forgot to disclose an asset we can help.

We are there to make sure your filing fees get paid and that the right people get served with notice of the bankruptcy in a timely manner.  

We are here to make sure that liens that can be wiped out get wiped out.  That’s a lot more complicated than just picking up the phone to let the lienholder know you’ve filed…and beyond that, there are no forms for stripping liens. 

Are you trying to keep your car? I can walk you through the positives and negatives. Do you go the redemption route, reaffirm your existing loan or just surrender your car.  

What happens if you don’t remember to complete your paperwork at the end.  There’s more than just filing the paperwork at the beginning.  You have to complete debtor education courses and other paperwork at the end.  

We’re even here for you after the fact.  What happens when an old creditor tries to come back and collect after the bankruptcy is over? 

I’m here for you from the day you file until your case is complete and then beyond.  It may sound like a lot to pay an attorney to file your case, but I’m more than just a paper jockey.  We add real, lasting value to what’s likely to be the biggest financial decision you ever make outside of buying a home.  

Call us today to discuss