Client Questions

Will my credit be ruined if I file Chapter 7 Bankruptcy?

More information: I live in Everett and have been considering filing for a Chapter 7 Bankruptcy because I cannot afford my credit card payments.  Someday I would like to buy a new home and I am concerned about my credit score after I file the Bankruptcy.  Will my credit be ruined?

Answer: That is a very good question. Actually, it’s one that most people ask during the initial consultation. Here is a well written article directly on point:

By Douglas Jacobs, California Bankruptcy Attorney

Not really.  The greatest effect on your Credit Score (Fico score) Is the number of late payments on your accounts.  More late payments – worse scores.  Certainly there are other factors, and filing bankruptcy may have the immediate effect of lowering the score.

But why do you care?  That’s the truly important question.

First of all, if you have months of missing credit card or house payments, your  credit score is none too good at the moment. Filing bankruptcy won’t hurt it that much.  And it will give you a fresh start – a clean slate to build your credit back from where it is and in far less time than it takes struggling to pay off those credit cards. [Read more...]

As a landlord, do I need to provide lead paint disclosure to my tenants?

Additional Information:

I own a three family home in Somerville, MA  and I have a new tenant.  A friend of mine mentioned that he provided a lead paint disclosure to his tenant.  Do I need to do this?

ATTORNEY ANSWER:

Yes.  Federal law requires that property owners, property managers and real estate agents leasing or selling housing built before 1978 provide certain information to tenants and buyers, including: an EPA-approved lead hazard information pamphlet, called “Protect Your Family from Lead in Your Home;” a lead warning statement; statements disclosing any known lead-based paint and/or lead-based paint hazards; and copies of all available records or reports regarding lead-based paint and/or lead-based paint hazards. This information must be provided to tenants and buyers before they enter into leases or purchase and sales agreements. Property owners, property managers and real estate agents equally share responsibility for providing lead disclosure information and must keep copies of records regarding lead disclosures for three years. [Read more...]

If I file for bankruptcy can I transfer title of my car to my sister?

More information: I live here in Malden and I am considering filing for bankruptcy. I own an 2010 Toyota Camry in my own name with no loan. Can I transfer it to my sister to have her name on the title instead of mine?

Answer: No. Transferring an asset with the intent to defraud creditors is fraud. When considering filing for bankruptcy, there are some things you must avoid. Here are some examples by Justin Harelik at Bankrate.com:

Many people find themselves in financial turmoil and finally decide that enough is enough; it’s time to file bankruptcy. The goal is for a fresh start from the monthly burden of trying to pay bills when there is not enough income to do so.

Bankruptcy happens. When it happens to you, try to avoid the following 12 common mistakes.

[Read more...]

When can I apply for another FHA loan?

Additional Information:

I bought my first home in Medford  with an FHA loan in 2006 but unfortunately, I had to short sell in 2009 because I lost my job due to illness.  When can I apply for another FHA loan?

ATTORNEY ANSWER:

The Federal Housing Administration, or FHA, understands that there are situations out of your control that force a short sale. There are three possible scenarios:

1.  If you had a hardship that caused you to short sell while you were current on your mortgage, current on other installment debts and are not liable to pay a deficiency, then you can immediately apply for another FHA mortgage.

2. If you were in default of your mortgage at the time of the short sale you cannot apply for another FHA loan for three years from the date that the FHA claim is paid on the short sale.

There are some exceptions to this bar including death or uninsured illness. More specific information can be found here.

3.  You are barred from applying for another FHA mortgage if you pursued a short sale on your primary residence because of decline in value of your home due to market conditions, and then later attempt to purchase in the same area. [Read more...]

If I submit a bankruptcy application can creditors still call me?

Additional  Information:

I lost my job and have had difficulty paying my bills.  I am way over my head in credit card debt and have received a notice of foreclosure on my home in the Boston North Shore area.  Creditors are constantly harassing me.  I have heard that once I submit a bankruptcy application, the creditors can’t call me anymore.  Is that true?

ATTORNEY ANSWER:

Filing a bankruptcy petition “automatically stays” (stops) most collection actions against the debtor or the debtor’s property. The stay arises by operation of law. As long as the stay is in effect, creditors generally may not initiate or continue lawsuits, wage garnishments, or even telephone calls demanding payments, without the approval of the bankruptcy court. There are some exceptions to this rule, such as criminal proceedings, collection of certain alimony and child support obligations and governmental actions to protect the public.  In addition, the automatic stay is temporary and will end as to the debtor when discharge is granted (at which time the discharge protects the debtor) or denied, when the case is dismissed or closed, or if the Bankruptcy Court grants a creditor or other party relief from the automatic stay.  [Read more...]

How does the new Massachusetts Homstead Law affect us?

Additional Information: Does the new Massachusetts Homestead Law eliminate the Homestead that my Attorney recorded for me three years ago?

Your prior Homestead is still intact.  After nearly a decade of legislative attempts to update the Homestead Law in Massachusetts, the Commonwealth of Massachusetts passed a comprehensive reform that took effect in March of 2011.   The new law now provides for an automatic Homestead for all homeowners plus allows homeowners to receive additional homestead coverage by filing a declaration with the Registry of Deeds. You may learn more about the new Massachusetts Homestead Law on our site. [Read more...]

Does a Will apply to everything I own?

Generally speaking, Wills affect only those assets which are solely in your name at the time of death.  For example, a house or bank account with only your name would be a probate assets and controlled by your Will.  Other assets, such as the proceeds from an insurance policy on your life, IRA’s, 401(k)’s are paid to the designated beneficiary —no matter who the beneficiaries under your Will may be.  Assets such as real estate, automobiles, bank accounts and other property held in joint tenancy will pass to the surviving joint tenant upon your death, not in accordance with any directions in your Will. Similarly, assets held in a trust at your death are distributed according to the provisions of that trust document rather than your Will.  In many instances, a trust executed in conjunction with a Will is strongly advisable. [Read more...]

Do I need a Will?

For people with minor children, dying intestate can have more serious consequences, because the court also will have no idea who you wanted to take care of your minor children.  In your will, you can name people that you trust to act as guardians of your children.  Although you only “nominate” a guardian, the court will give your choice top priority in making its decision.   Choosing a guardian for your children is not an easy decision.  This involves frank discussions about people close to you.

If you don’t make the decision during your life, a judge will make the decision after your death and appoint a Guardian ad Litem.  A Guardian Ad Litem is a person appointed by a judge to represent the minor in a court proceeding in which the minor has some interest. That judge doesn’t know intimately the character of those persons close to you who could act as guardians for your minor children.

[Read more...]

I filed Chapter 7 Bankruptcy. Is the lein on my property automatically dissolved?

Additional Information:

I own a home in Melrose, Massachusetts.  A credit card company has placed a lien on my property.  I have since filed for Chapter 7 Bankruptcy and included the credit card debt in the bankruptcy petition.  I recently successfully obtained my bankruptcy discharge, the lien is automatically dissolved, correct?

ATTORNEY ANSWER:

No.  A discharge in bankruptcy does not automatically remove liens on property.  It solely relieves the debtor of personal liability.  In order to remove the lien, the debtor must request that the court specifically order that the lien be voided.  A certified copy of the judge’s order voiding the lien should be recorded in the Registry of Deeds.  Another way a lien can be removed is if the court orders that the property be sold free and clear of liens.
[Read more...]

Can Wills be changed in Massachusetts?

Yes. You should review your Will periodically (at least every 3 to 5 years) because, if it is not up to date when you die, your estate may not be distributed as you wished and subject to Intestacy Laws. You should also review your Will when there are any major changes in your family (such as births, deaths, divorces, and marriages), when the value of your assets significantly increases or decreases, and when it is no longer appropriate for the persons named as Guardian or Executor or Trustee to act in that capacity. Also, a marriage revokes a Will automatically.

[Read more...]

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