Important Points for the Future

1. For all cases:

a. When creditors "write off" or "charge off" an account, they write it off on their taxes, and the borrower will usually owe income tax on what was written or charged off. To do this, they generate a version of a form 1099 called a 1099-A or 1099-C. With rare exceptions that are not applicable to typical consumers, filing bankruptcy prevents this tax event, but it does not make lenders perfect. If you receive a 1099-A or 1099-C tax form from a lender that was included in your bankruptcy, please remember to call us. We will send you a Form 982 from the IRS, and the issue will be resolved. If your tax preparer tells you otherwise, please get a second opinion, because your tax preparer is incorrect.

b. Credit updating: When you complete your case, your credit report will not look the way that future lenders need it to look. An update process is required, and we have fully discussed this with you.

i. If you elected to retain for "Complete" representation, then we will send you instructions on how to do this. You must follow the instructions because we can't update the reports for you. You must bring the reports to a meeting with one of our attorneys to complete the process.

ii. If you elected to retain for "Base" representation, then you will not receive this assistance because the courts do not require attorneys to assist with this. There will be additional fees if you need our help.

2. Chapter 13 cases

a. If you file a Chapter 13, remember that you may be able to look into refinancing your home in one to two years (two to three if you were in foreclosure when you filed) if (1) your Chapter 13 payments were made on time during this period and (2) your mortgage payments have been made on time during this period. Paying late or missing payments may limit your options. Please set up an appointment with our office if you want to explore this.

b. If you have a mortgage or other debt that is to be paid direct, the lender MAY STOP SENDING YOU MONTHLY STATEMENTS while you are in your case. The lender is not doing this to penalize you, rather, the lender is afraid that a bill is a demand for payment that is outlawed in bankruptcy. Some lenders bill anyway, and some lenders send monthly reminders. Others will continue billing only if your attorney sends the lender something requesting it. While we can request that they do this, it does not guarantee that the lender will continue billing.