Rafuse Law Firm, P.C. can help you evaluate your current financial condition. We offer a free financial consultation for individuals who feel the pressure of overwhelming debt. We will not force you to do something you don’t want to do. All we can do is give you options and tell you what the possible outcome may be if you choose that option.

   For example, if you have a notice of a foreclosure sale of your house, you have several options depending on whether you hold any equity in the house. The term “equity” means that the house’s value exceeds the amount you owe the mortgage company. For example, Debtor owes $45,000.00 on a house valued at $50,000.00. Debtor has $5,000.00 equity in the house.

   If you don’t have any equity in the house, you can choose not to oppose the foreclosure. If the house is sold after foreclosure, you may be responsible for paying the difference between what you owe the mortgage company and the purchase price at the foreclosure sale.

   If you decide you want to keep the house, you may attempt to refinance the house, set up a deferral period for payments, reduce your monthly payments or obtain governmental assistance. Several of these options require the consent of the mortgage company and you should consult with an attorney to determine whether and how one of those options can be accomplished.

   If none of the options above are available to you, you may consider filing a Chapter 13 Bankruptcy. In a Chapter 13 Bankruptcy, a debtor prepares a budget and calculates his or her excess income which is left each month after paying for his or her necessary living expenses. The calculated excess income is then paid to a trustee who will then distribute money to your creditors to pay a percentage of your debt. You can pay the mortgage arrearage through a Chapter 13 Bankruptcy. The “arrearage” is the difference between what you should have paid and what you have paid. However, you must continue to make your regular monthly mortgage payment in addition to the payment to the trustee and you must maintain the insurance on your home. Failure to make the monthly payment to the trustee, make the monthly mortgage payment, or maintain homeowner’s insurance could give the mortgage company the opportunity to renew its efforts to foreclose on your house.

   If you have equity in your house, you may be able to find a new mortgage company and refinance the note, possibly reducing your monthly payment and/or your interest rate. If you have substantial equity in the house and the arrearage is less than 80% of your equity in the house, you could apply for a home equity loan. To get a home equity loan, you must give the lender a security interest in your home. That lender will have a second mortgage on your home. Failure to pay either mortgage payment could result in a foreclosure.

   There are many other debts which can be paid or reduced in a similar way. A bankruptcy should be viewed as a last resort. If you have just recently received a notice of levy from the Internal Revenue Service or if your car has been recently repossessed, there is a possibility that a bankruptcy can help you.

   Pursuant to the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, Rafuse Law Firm, P.C. qualifies as a debt relief agency. That act created 11 U.S.C. §527 which requires a debt relief agency to disclose several facts. For your convenience, the facts are listed below:



   If you decide to seek bankruptcy relief, you can represent yourself, you can hire an attorney to represent you, or you can get help in some localities from a bankruptcy petition preparer who is not an attorney. THE LAW REQUIRES AN ATTORNEY OR BANKRUPTCY PETITION PREPARER TO GIVE YOU A WRITTEN CONTRACT SPECIFYING WHAT THE ATTORNEY OR BANKRUPTCY PETITION PREPARER WILL DO FOR YOU AND HOW MUCH IT WILL COST: Ask to see the contract before you hire anyone.

   The following information helps you understand what must be done in a routine bankruptcy case to help you evaluate how much service you need. Although bankruptcy can be complex, many cases are routine.

   Before filing a bankruptcy case, either you or your attorney should analyze your eligibility for different forms of debt relief available under the Bankruptcy Code and which form of relief is most likely to be beneficial for you. Be sure you understand the relief you can obtain and its limitations. To file a bankruptcy case, documents called a Petition, Schedules and Statement of Financial Affairs, as well as in some cases a Statement of Intention need to be prepared correctly and filed with the bankruptcy court. You will have to pay a filing fee to the bankruptcy court. Once your case starts, you will have to attend the required first meeting of creditors where you may be questioned by a court official called a “trustee” and by creditors.

   If you choose to file a chapter 7 case, you may be asked by a creditor to reaffirm a debt. You may want help deciding whether to do so. A creditor is not permitted to coerce you into reaffirming your debts.

   If you choose to file a chapter 13 case in which you repay your creditors what you can afford over 3 to 5 years, you may also want help with preparing your chapter 13 plan and with the confirmation hearing on your plan which will be before a bankruptcy judge.

   If you select another type of relief under the Bankruptcy Code other than chapter 7 or chapter 13, you will want to find out what should be done from someone familiar with that type of relief

   Your bankruptcy case may also involve litigation. You are generally permitted to represent yourself in litigation in bankruptcy court, but only attorneys, not bankruptcy petition preparers, can give you legal advice.

   This web page and the information provided herein is not an offer to represent you in your case. Please call and make an appointment with our office to find out whether we can possibly help you deal with your financial problems.