The COVID-19 pandemic along with the expiration of the eviction moratorium is expected to fuel a rise in bankruptcy filings at the beginning of 2022, according to an Indianapolis-based lawyer.<\/p>\n
After the eviction moratorium ended over the summer the Consumer Financial Protection Bureau put new rules into place to curb foreclosure.<\/p>\n
What the mortgage company cannot do under the new rules is they cannot foreclose unless the borrower has been behind for over 120 days, said Indianapolis bankruptcy attorney Mark Zuckerberg.<\/p>\n
But unless those rules are extended beyond the new year, Zuckerberg said he is expecting a flood of bankruptcy cases not seen since the housing crisis a decade ago.<\/p>\n
People generally file for Chapter 7 or 13 after suffering a significant event that hurts their finances.<\/p>\n
It's either divorce, loss of job, medical bills for death of a family member, and they just can't handle the burden of debt that they're under, he said.<\/p>\n
A person qualifying for Chapter 13 will be required to pay back what they owe over a three-to-five-year period.<\/p>\n
The bankruptcy code sets forth how the money is going to be passed out. It's called the priority system, said Zuckerberg.<\/p>\n
Chapter 7 releases the debtor from paying unsecured debts, such as credit card and medical bills, but you may be required to relinquish some luxury items.<\/p>\n
If you owe $100,000 on a house and you haven't paid on it for two years, because of COVID. You can't file bankruptcy and keep your house, he said.<\/p>\n
If you file for Chapter 7 bankruptcy, it will stay on your credit report for 10 years; Chapter 13 will remain on your credit report for seven years.<\/p>\n
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Originally posted here:<\/p>\n
Bankruptcy lawyers expect filings to increase in 2022 - WFYI<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" The COVID-19 pandemic along with the expiration of the eviction moratorium is expected to fuel a rise in bankruptcy filings at the beginning of 2022, according to an Indianapolis-based lawyer. After the eviction moratorium ended over the summer the Consumer Financial Protection Bureau put new rules into place to curb foreclosure Continue reading