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If you're thinking about filing for bankruptcy, you're probably wondering if you can keep your house, car, or any other item that you are making payments on, such as a boat, ATV, computer, etc.  The short answer is yes, but you have to get caught up (if you are behind) and keep making your regular payments on time and when due.  If you are leasing (renting) property, you have to get caught up and keep making your payments.

What I just said -- that you have to get caught up if you are behind and keep making regular payments -- applies to both Chapter 7 and Chapter 13 bankruptcy.  This article applies mainly to Chapter 7 bankruptcy, and not Chapter 13.  To learn more about your options for bankruptcy, please read my previous blog posts on the subject.  Here is a link:    
http://www.balandlaw.com/3/category/bankruptcy/1.html.

When you file for bankruptcy, the bankruptcy trustee (the person who is in charge of administering your bankruptcy) will take all of your property and sell it to pay your creditors, or the people you owe money to.  There are three basic ways to keep your property out of the hands of the bankruptcy trustee:

(1.) EXEMPT: Property that is exempt does not go to the bankruptcy trustee and does not become part of what is called your bankruptcy estate.  Your bankruptcy estate is all of the property that is not exempt and available to the bankruptcy trustee to pay your creditors.  The law provides that some property is automatically exempt,and does not become part of your bankruptcy estate.  You can decide whether to use the exemptions provided by federal law or state law.  For most people. federal exemptions are more appropriate, although there are good reasons to choose state exemptions.

Regardless of whether you choose the state or federal exemptions, you get to keep the clothes on your back, your "household goods and furnishings" (like your furniture, radio, television, etc.) up to a certain value, and a car (again up to a certain value).  These are only examples, and there are many more exemptions available.  For a full list, see 11 U.S.C. 522 and Minn. Stat. 550.37.

(2.) REAFFIRM: If you owe money and are making payments on a loan that is secured by an item of property, such as a car or house that the creditor (the person to whom you owe money), you can generally keep that property if it is exempt and you reaffirm the debt and agree to keep making your payments when they come due.  This happens most often when you are making payments on a car loan or mortgage, and want to keep the car or house.  So you reaffirm the debt, and promise to keep making payments on it in order to keep the property.

To reaffirm a debt, you sign a document called a Reaffirmation Agreement that is usually prepared by the creditor.  Every Reaffirmation Agreement must be approved by a judge, unless it involves real property.  Approval is not automatic, and a judge does not have to sign off on a Reaffirmation Agreement.

Sometimes, a judge does not approve a Reaffirmation Agreement, especially if you are trying to reaffirm a debt on something that is not practical, such as a boat, recreational vehicle, ATV (all-terrain vehicle).  Usually, if a Reaffirmation Agreement is not approved, the judge thinks it makes more sense for you to give up the property than keep it and keep making payments.  In such a case, I generally recommend contacting the creditor to see if the creditor will let you keep the property if you continue to make your payments.

(3.) BUY BACK: As a bankruptcy attorney, I try to find as many exemptions as possible to keep your property out of the hands of the bankruptcy trustee.  If, for whatever reason, a certain item of your property goes to the bankruptcy trustee, you can buy that property from the trustee and get the property back by paying the value of the property to the trustee.  For example, if you have a nonexempt item of personal property that goes to the trustee, you can pay the value of that property to the trustee to get the property back.

Baland Law Office, P.L.L.C. represents consumer debtors and small businesses in both Chapter 7 and Chapter 13 bankruptcy proceedings.  Please call (763) 450-9494 to schedule an appointment to discuss your situation today and find out whether declaring bankruptcy is the right option for you!

DISCLAIMER: Baland Law Office, P.L.L.C. is a debt-relief agency, and Timothy H. Baland, Esq. is a debt-relief agent.  We help people like you to obtain bankruptcy relief.

WARNING: The information contained in this article does not constitute legal advice and may not be applicable to your situation.  Reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C.  This blog post may constitute attorney advertising.  Further, Tim is licensed only in Minnesota state and federal courts, and the information that is provided here is applicable only to those jurisdictions.  You should always discuss your situation with an attorney before taking any action based on what you may read in this blog.  To that end, please call (763) 450-9494 to set up an appointment to discuss your situation.


 
 
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If you are driving and pulled over by the police, you are probably wondering what to do.  Nearly everybody who drives will be pulled over at some point.  If you are pulled over, don't take it personally, and remain calm, rational, and businesslike.  Here are some general pointers to follow if you are pulled over:

DO have your necessary documents ready – valid driver’s license, insurance card & proof of registration, and get those documents out before the police officer approaches your vehicle.

DON’T roll down your window only an inch to pass the documents – you will look unnecessarily suspicious.  Roll your window down all the way.

DO pull over as soon as you safely can – the officer will appreciate your prompt response.  Pull over as far as you safely can, signal that you are pulling over, and turn your ignition off after you have pulled over and rolled down your window.

DON’T give the officer permission to search anything – if they proceed without permission, stay calm and remember all of the details of the search (I recommend writing down what happened after the officer lets you go) to tell your attorney.

DON"T give a statement to the officer – the officer will typically try get you to admit that you were speeding or had an equipment violation.  Under no circumstances should you admit that you were breaking the law because such an admission could come back to haunt you.

DO keep your hands in plain view – put them at 10 o’clock and 2 o’clock on the steering wheel.

DON’T be a jerk – it’s not going to help your situation.  Address the officer as "Officer" and be polite, businesslike, and respectful.  Remember, the police officer is doing his or her job and has the power to issue you a ticket, give you a warning, and let you go.

DO turn on your interior lights if it is at night – to prove you aren't trying to hide something.

DON’T give the officer a reason to be worried or suspicious – stay calm and do what they say.

DO carefully drive away and be mindful of all traffic laws – cautiously merge back into traffic, signaling accordingly.

DON'T drive off until the officer gives you permission to leave and gets back in his/her car.

DON’T get out of your car - unless asked by the officer to do so.

DO thank the officer regardless of the outcome of the encounter, and ask the officer if you are free to leave.

If you are given a ticket, you will have to decide whether you want to plead guilty by paying the fine, challenge the ticket, or take other action.  Every situation is different, so it is impossible to cover every possible variation in an article.  Please call me at (763) 450-9494 to set up an appointment to discuss your situation.

WARNING: The information contained in this article does not constitute legal advice and may not be applicable to your situation.  Reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C.  You should always discuss your situation with an attorney before taking any action based on what you may read in this blog.  To that end, please call (763) 450-9494 to set up an appointment to discuss your situation.