The corona virus pandemic is devastating the economy and will likely lead to a spike in bankruptcy case filings. When we begin to emerge from widespread stay-at-home orders, many of us will be facing financial distress. Covid-19 illness related medical debts, loss of income, loss of jobs, and attendant increases in debt will require bankruptcy relief.

While no one is thrilled to file for bankruptcy protection, the bankruptcy courts are available precisely for helping the honest, but unfortunate person get a fresh start. Chapter 7 is typically a simple, straight forward bankruptcy case to get a discharge of debt and start over. Chapter 13 involves the proposal and court approval of a debt adjustment plan where you can restructure certain debts in order to save a home from foreclosure or a car from repossession.

Congress specifically had bankruptcy in mind with responding to the corona virus with passage of the CARES act. The CARES act, in part, permits current chapter 13 debtors to modify their plans to extend them up to 7 years. It also enlarges the debt threshold for small business to request treatment under subchapter V of chapter 11, which is generally more favorable to the struggling small business than regular chapter 11 provisions.

If you have suffered financially from the corona virus epidemic or simply have questions about the bankruptcy process, chapter 7, chapter 13, or consumer protection, please give us a call to discuss your options. Consultations are free and confidential.

In February 2020, new bankruptcy laws become effective for small businesses seeking to reorganize under chapter 11 of the bankruptcy code.  The sweeping changes make it much easier and affordable for small companies to obtain relief under the newly titled “Subchapter V” of chapter 11.

Businesses who qualify to file bankruptcy under Subchapter V will realize several important benefits.  While a trustee is appointed, the small business will remain in control of its operations and the trustee is tasked with assisting the company’s reorganization.  Only the small business may propose a plan and, unlike traditional chapter 11 cases, the plan will not need to comply with the absolute priority rule where the businesses owners could not retain their ownership stake unless they contributed new value into the bankruptcy case.  Mortgages and other loans can be modified in the reorganization plan even over the objection of the lender.

If you own a business that is struggling with debt, but otherwise profitable in its operations, our attorneys at Hurtt & Johnson can advise you about your options to reorganize in bankruptcy under chapter 11, chapter 12, or chapter 13.  We can also assist with filing a traditional bankruptcy under chapter 7.

The biggest debt collection agencies include Transworld Systems, Midland Funding (aka Midland Credit Management), LVNV Funding, Portfolio Recovery Associates, and Nationwide Recovery. These collection companies control the vast majority of past-due accounts for everything from credit card debts, medical debts, personal loans, and repossessed vehicle debts. They often operate through subsidiaries, such as Resurgent Capital. Debt collection agencies often purchase accounts for pennies on the dollar and then try to collect the full amount.

Debt collection agencies have to comply with government regulations such as the fair debt collection practices act to protect consumers. Thousands of debt collection letters and lawsuits are filed every month. The high volume of this activity can lead to collection agencies making mistakes or violating applicable laws. These violations can lead to a denial of the debt or a separate recovery for the consumer for each violation.

If are you facing harassment, dunning letters, or even a lawsuit or a garnishment from a debt collector, please give our office a call at 706.226.5425. We can assist you in fighting the lawsuit or if there is a bigger financial problem we can help you get a fresh start through a chapter 7 or a chapter 13 bankruptcy case.

It is important to understand the differences between chapter 7 and chapter 13 bankruptcy.  While there are ways to retain car loans and mortgages in chapter 7, sometimes the only option for retaining these important arrangements is through a chapter 13 case.

If you are behind on a car loan or a mortgage loan (or both), you can force the lender to give you a chance to payoff the car or catch up the mortgage by a court-approved chapter 13 debt adjustment plan.  Explore our website and read our article on NearSay to understand the differences and for bankruptcy attorney services in Dalton and Whitfield County.

Call us today at 706.226.5425 or through our website for free and confidential consultation about solutions to your financial problems.

On May 2, 2018, Beaulieu confirmed a chapter 11 plan.  The plan creates a liquidating trust that will receive all remaining assets and then make distributions to creditors.  Importantly, the court preserved for the benefit of the trust any claims that Beaulieu had to recover money or property.  Beaulieu originally submitted a lengthy list of possibly preferential transfers to creditors and third parties prior to their original bankruptcy filing.

Preferential transfers can be “avoided” (reversed) and the money reclaimed.  It is often very frustrating for creditors, many of which already lost tens of thousands in bankrupt debt, to receive letters from the bankruptcy representatives demanding that money be returned.  There can be defenses available to otherwise valid preference claims.

It is our understanding that the liquidating trustee, PMCM 2, LLC, is now sending out demand letters on preferential transfers.  If you or your company has received a demand letter to return a preference or other transfer, please give us a call – 706.226.5425 – to discuss your options.

Sued by Midland Funding?  We can help.  Midland Funding, together with Midland Credit Management and Asset Acceptance Capital Corp., form the nation’s largest debt buyer.  They are in the business of buying debts at a large discount and then suing to recover the debt with a profit.  Midland Funding files many lawsuits in the Dalton, Whitfield County courts, the Chatsworth, Murray County courts, and surrounding areas in Georgia.

Midland Funding has a history of some bad behavior with its collection activities that resulted with the Consumer Financial Protection Bureau taking action against them.  The wrongful activities included:

• Attempted to collect on unsubstantiated or inaccurate debt;
• Misrepresented their intention to prove debts;
• Relied on misleading, robo-signed court filings;
• Sued or threatened to sue consumers on stale debt; and
• Harassing collection calls.

If you have a lawsuit filed by Midland Funding, Midland Credit Management, or Asset Acceptance, please give us a call – 706.226.5425.  We provide a free and confidential initial consultation to our consumer clients to evaluate whether we can defend the lawsuit, counterclaim for violations of federal or state law, or consider whether a petition for a fresh start with a bankruptcy discharge is right for you.

In the recently decided case of Title Max v. Northington, the 11th Circuit unfortunately decided with the title pawn company.  Because the title pawn lender filed a motion for relief and the debtor did not redeem the vehicle in time, the court found that the vehicle rightfully belonged to the title company.  This ruling makes it clear that a bankruptcy attorney must be diligent in protecting their client’s ownership of a title pawned vehicle.

If you are suffering from a high interest title pawn transaction and looking for relief, please call our office for a free and confidential consultation.  We are bankruptcy attorneys located in Dalton, Georgia and we provide professional legal services to all of Northwest Georgia.

Portfolio Recovery Associates has recently filed a new wave of lawsuits in Whitfield County Magistrate Court.  Often these lawsuits are based upon charged off credit card balances and some are multiple years old.  Portfolio Recovery Associates usually buys these debts for steep discounts.

If you have been sued by Portfolio Recovery Associates, please give us a call.  Under Georgia Law, you only have 30 days to respond to the lawsuit.  You may have valid defenses to the debt or counterclaims under the Fair Debt Collection Practices Act.  In other situations, it may make sense for you to get a fresh start in a Chapter 7 Bankruptcy or have the court approve a debt adjustment plan in a Chapter 13.

The 11th circuit recently issued an opinion regarding the dischargeability of taxes in bankruptcy when the debtor filed the tax return late.  In Justice vs. U.S., the debtor did not file tax returns on time.  Over a few years, the IRS issued deficiency notices and eventually assessed taxes based upon a substitute return.  The 11th Circuit determined that the tax debt could not be discharged in bankruptcy.  The Court followed the so-called Beard test regarding whether the debtor made an honest attempt at complying with applicable tax law.  Because the debtor filed returns so many years late and only after the IRS made the tax assessment, the Court ruled against the debtor.

If you owe back taxes or are suffering under the heavy hand of the IRS collection process, we may be able to help.  At Hurtt & Johnson, our attorneys have successfully discharged over one million dollars of federal and state tax debts through the bankruptcy courts.  For taxes that cannot be discharged, our attorneys assist clients with halting the government’s collection efforts and approving an affordable repayment plan through the court.  Please call us today to schedule a free and confidential initial consultation to evaluate your options.