As you begin the bankruptcy petition process with your Nassau County bankruptcy attorney, you’ll be asked to file a statement of intention regarding property secured by liens (usually a car or a house.) In essence, you must decide whether you want to keep (and be obligated to pay for) the asset in question, or if you want to give it up.

Most debts are dischargeable under the federal bankruptcy code, so you can choose to relinquish the asset and have the outstanding debt become eligible for discharge. While this may be a prudent move for many types of secured assets, most people are reluctant to part with their personal vehicle because they rely on it for transportation to and from work.

One method that your Nassau County bankruptcy attorney may counsel you on is a Reaffirmation of Debt. This process can help you keep your personal vehicle during the bankruptcy process – but be warned: A Reaffirmation of Debt is a formal agreement that renews your legal obligation to be financially responsible the property in question. The renewed debt also becomes ineligible for discharge.

Reaffirming a debt also involves a few intricacies which your Nassau County bankruptcy attorney will explain to you in greater detail. For example, even if you and the lender agree to the terms of a reaffirmation, the bankruptcy judge can override it if he or she feels the obligation is not in your best long-term interest.

Additionally, even though you obligate yourself to this new contract once you sign it, most states give you a window of opportunity to cancel it if you later reconsider (usually 45 to 60 days, but again your Nassau County bankruptcy attorney will advise you about your particular situation.)

As a matter of routine, most Nassau County bankruptcy attorneys caution against committing to a Reaffirmation of Debt because it undermines the very protections you are seeking to receive by filing for relief. However, in the right circumstances, a Reaffirmation of Debt may be the best course of action for people who have a steady source of income and can commit to honoring an ongoing installment obligation.

It’s important to weigh all the pros and cons before undertaking a Reaffirmation of Debt. A reputable Nassau County bankruptcy attorney will help you weigh your options so you can decide if reaffirming a debt is the right path for you.

Nassau Bankruptcy Attorneys know that it’s not just civilians who are impacted by the economy. The economic downturn has affected people from all walks of life across America, including many of the over 1.4 million active duty military personnel serving in the United States Armed Forces. Even though service members enjoy employment stability themselves, circumstances (such as a spouse’s layoff or a health issue) can wreak havoc on a military family’s finances.

 

Because the American government wants to keep national defense strong, lawmakers realized that service members on active duty needed a method of protection to help them preserve their economic status and rights while they are away from home on deployment.

 

Thus, the Servicemembers’ Civil Relief Act (SCRA) was signed into law in December of 2003. This long overdue piece of legislation was hailed by Bankruptcy Attorneys in Nassau County for its depth of protection to American military personnel.

 

Primary protections include:

 

Protection from Default Judgments:

 

Rules now require that plaintiffs file an affidavit with the court stating whether the defendant is in the military or not. Additionally, the court cannot order an entry of judgment until the court has appointed an attorney to represent the defendant. The court may also make further decisions, orders, or judgments to help protect the rights of a service member. Your local Nassau Bankruptcy Attorney can advise you about these critical rights in further detail.

 

Stay of Proceedings (Where Service Member has Notice of Proceeding):

Prior to any final judgment in a civil matter involving a member of active-duty military, the service member covered by the SCRA may ask the court to stay the proceeding pursuant to 50 U.S.C. app. § 522. This stay grants the defendant a stay of at least 90 days (and sometimes longer). The application for a stay under this section requires additional documentation, and your experienced Bankruptcy attorney can advise you further on this matter.

 

These are just two of the many protections offered to military personnel under the Servicemembers’ Civil Relief Act.

 

One caveat:  While the SCRA offers full protection to active duty military personnel, only a portion applies to the nation’s approximately 848,000 reservists. If you’re currently serving in a reserve status, it’s important to consult with your Bankruptcy lawyer to discuss the exact extent of protections allowed to you under the SCRA.

 

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