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The Jefferson County commissioner has announced that the county has an 80 percent chance of filing for bankruptcy.

The commissioner made this announcement after a day full of meetings with bankruptcy lawyers. She is now the first democrat that supports the plan for the county to file for bankruptcy. This option is looking like more and more of a possibility if a settlement is not reached with creditors.

Creditors have yet to respond to a settlement that was submitted last week that will increase sewer costs in order to erase $1.3 billion of a $3.14 billion sewer debt that has been around since 2008. A discussion with creditors was hoped to be reached by this week, but it has not occurred at this time.

If you or a loved one has been considering bankruptcy, you need experienced representation on your side. Contact the bankruptcy lawyers in Birmingham of Greenway Law, LLC, by calling 205-324-4000 today.

Tags: Bankruptcy, Jefferson County

I have recently seen a few second mortgages “reaffirmed” in bankruptcy by some of my fellow bankruptcy attorneys. However, in Michigan, as I’ve described here, there is no reason to file what is called a reaffirmation agreement for a mortgage debt when you file a Chapter 7 bankruptcy. So long as you are current on your mortgage payments, you will likely have no issue with retaining your home (although there is the possibility that, if it is an especially “luxurious” home, the Bankruptcy Trustee appointed by the court to your case may see retention of the home as an issue of “good-faith” in your bankruptcy filing).

A reaffirmation agreement, in a nutshell, is an agreement signed as part of a Chapter 7 bankruptcy that must be approved by a judge to be valid, that in essence continues your legal liability for the reaffirmed debt even after the bankruptcy would have discharged it. In Michigan,

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Tags: Bankruptcy, File Bankruptcy

Debt-laden electric power company AES Eastern Energy LP filed for Chapter 11 bankruptcy with a plan to sell its two upstate New York coal-fired power plants. Read the Daily Bankruptcy Review article via The Wall Street Journal.

Ally Bank, which is owned by the U.S. government, won’t force its ResCap unit into bankruptcy protection, the New York Post reports.

According to WSJ, former MF Global Holdings Ltd. Chief Executive Jon Corzine’s European bond strategy is becoming clearer.

Credit Slips discusses the decline in bankruptcy filings by chapter.

Bankruptcy Judge Arthur J. Gonzalez, who handled such iconic cases and Enron and Chrysler, will retire in March, DealBook reports.

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Tags: Aes Eastern, Bankruptcy

Social Security benefits, both age benefits and disability benefits, are and also are NOT considered “income” within the bankruptcy process in a couple of different ways.

Income is considered in the bankruptcy process both as a measure of a debtor’s eligibility for Chapter 7 (as opposed to Chapter 13) bankruptcy and as a measure of the debtor’s ability to repay creditors some portion of the debt owed to them on monthly average basis.

The first measure is calculated within the framework of the so-called “means test,” about which I have written extensively on this blog, which is both the test for Chapter 7 eligibility and also, in a Chapter 13 context, the barometer of whether the debtor may file a 3-year payment plan or a 5-year payment plan and what the minimum amount the debtor must pay to certain creditors in a Chapter 13 payment plan must be.

For purposes of this means test, Social Security benefits have been specifically stated in the US Bankruptcy Code to be NOT calculable as “income.” In other words, in the means test, all of your income from every source for the past 6 months is calculated to produce an average income number—except for Social Security. Thus, a debtor wh

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Tags: Bankruptcy, Social Security

Guest Post by Atlanta Bankruptcy Attorney Peter Bricks.

I am often surprised how many chapter 7 bankruptcy debtors who want to file bankruptcy just before a foreclosure sale to stop the sale, ask the following question: Can I short sale my house after I file bankruptcy?

Although it can be done, it rarely makes sense. The reason is because a home mortgage short sale after filing chapter 7 bankruptcy rarely makes sense.

When I ask clients why they want to short sale their house after filing bankruptcy, the response I usually get back makes clear that the debtor does not fully understand the ramifications of their bankruptcy filing and the relief it afforded. Unless a chapter 7 debtor reaffirms their secured debt in the bankruptcy, then the debt is discharged.

For example, lets say the debtor owns a house worth $130,000 and has a mortgage at $150,000.

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Tags: Bankruptcy, Bankruptcy Why