Cincinnati Bankruptcy Law Blog

When individuals decide to file for bankruptcy, they may face a myriad of emotions as a result. Though bankruptcy can be a frustrating process and the prospect of a temporary credit score dip can be scary, filers also often find relief in knowing that certain assets are almost always protected during the process and will remain intact. Unfortunately, interpretation of bankruptcy law can vary from jurisdiction to jurisdiction. This inconsistency can make it difficult for bankruptcy filers to know just what to expect from the process.

For example, there is currently a split in opinion among several federal circuit courts concerning just how far creditors may go in collecting debts. Generally, certain assets are protected in the bankruptcy process including some federal benefits and personal property that has significant emotional value. Certain courts also protect retirement accounts, however others do not.

This is no joke - the tri-annual adjustment of exemption amounts set forth in Ohio Revised Code section 2329.66 goes into effect on April 1, 2013. Exemptions are laws which allow people who file for bankruptcy to protect their assets. After this change, more of an individual's assets can be protected from judgments and creditors. The most notable change is the homestead exemption. An Ohio resident can now protect up to $132,900.00 in equity in his or her home, according to the Ohio Judicial Conference. Other exemptions have been increased too, including the exemptions for motor vehicles ($3,675), cash ($450), household items ($12,250 total), personal injury awards ($23,000), etc. Under the new law, people who file for bankruptcy in Ohio can have a greater degree of certainty that their assets will be protected.

When mortgage debt becomes overwhelming, seeking a loan modification may be an excellent option for you and your family. Under certain circumstances, a well thought out and carefully constructed loan modification can help homeowners avoid foreclosure. However, as loan modifications become increasingly popular, scammers have opted to try and take advantage of vulnerable homeowners with increasing frequency.

Perhaps even more disturbing is the fact that many loan modification scammers are posing as attorneys. Some certified lawyers are lending their support to fraudulent so-called modification specialists, but others are simply holding themselves out to be licensed attorneys when they are not.

Many young adults just starting out in the job market often carry a large debt burden due to low salaries, student loan payments, and the temptation to finance desired goods through excessive credit card purchases. If you are in this position, there are steps you can take to pay down your debt and thereby secure a more profitable and stable future for yourself.

Start by asking yourself what expenditures you can cut back on. Examples of ways to be more fiscally prudent include: not taking a vacation away from home or doing so in a more bare-bones manner; cooking more and rarely eating out at restaurants; and cutting back on items such as TV's, furniture and new cars.

Paying off your debt in an aggressive and advantageous manner is the next step. Enrolling in automatic payment plans for your credit cards and loans will keep you on track for paying down your debt and prevent you from being tempted to use that money in other ways. Also, check into whether making automatic payments might earn you a slightly lower interest rate from your lenders.

If you have federal student loans, you may qualify for an income-based repayment plan that lowers monthly payments to no more than 15 percent of your discretionary income.

Calling your lender to determine what your options are can reduce credit card debt. While you should watch out for disreputable credit-counseling agencies, you might consider the services of a trustworthy one such as the National Foundation for Credit Counseling to help negotiate a lower interest rate on your behalf.