Nebraska Debt and Bankruptcy Blog

Nebraska Debt and Bankruptcy Blog

Do Suggestions of Bankruptcy Constitute an Appearance of Counsel?

Posted in Garnishment

A “Suggestion of Bankruptcy” is a document filed in a lawsuit to notify the court that the defendant has filed bankruptcy. Filing such notices with the court is very helpful to the court and to opposing parties so they may cancel upcoming court hearings or pending garnishment orders. Many courts automatically place a pending lawsuit on hold until further order of the bankruptcy court and take affirmative steps to release garnished funds.

Our office files bankruptcy cases electronically and in the next moment we electronically file Suggestions of Bankruptcy with the Nebraska court system. The system is efficient and quick. The goal is to “put out the fire” of collection activity as quickly as possible, and filing Suggestions of Bankruptcy greatly facilitate that goal.

In most cases the bankruptcy results in a discharge of debts, but what happens if the bankruptcy case is dismissed without

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Life Sucks Budget: Part II

Posted in Budgeting

The basic concept of the Life Sucks Budget is that for many of us there is just not enough money to pay the claims of bill collectors AND to pay the really important things of life, like retirement savings, emergency cash accounts, mortgage payments and modest family vacations. Something has to give, and too many of us put ourselves last and pay nothing towards our future needs and dreams so that we can just get by another month without receiving embarrassing phone calls or letters. The Life Sucks Budget is a call to rebalance this relationship and to put our legitimate financial and family needs first.

The fact is, many of you are already on the Life Sucks Budget but you don’t realize it or perhaps you are reluctant to confess that is what you are doing.

Spending 25 years interviewing clients about their

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Life Sucks Budget

Posted in Budgeting

Rule #1 of credit counseling is when you are trying to get out of debt you must forgo some expenses while paying off debt. The advice is universal. Decrease expenses. Increase income with a part-time job. Sell some stuff to raise cash. Get the debt snowball rolling. Suck it up and double down on the smallest debt and then the next smallest until all the debt is gone. Live like a crazy person until you can scream out loud I’M DEBT FREE!

And if your debt problem is that you spend money like a moron and you just need to grow up and cut expenses and work a pizza delivery job at night until you pay off the debt, that may be good advice. Dave Ramsey has built a 55 million dollar financial empire by giving out such advice.

But what if you already

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Pay Yourself First Part II: How to implement it.

Posted in Budgeting

In performing financial autopsies for my bankruptcy clients over the past 25 years I have noticed one common mistake people make. They fail to prioritize their money.

Priorities matter. Successful people have a common trait–they prioritize their day and do he most important tasks first. They write lists. They have WRITTEN goals for their day. They plan their day in advance, and then they go out an kick butt.

But when it comes to money, especially money in marriage, even organized people get messed up about how to set priorities with their money. Why is that?

I think part of the answer lies in those sappy marriage courses we take before our weddings.  You know, the ones that say how a man and women become one and cease to have separate identities. No secrets in marriage. Everything is shared. Mutual submission. Love is generous and we

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Pay Yourself First

Posted in Budgeting

There is one simple habit that all financially successful people do–they pay themselves first.

That phrase has always annoyed me.  Pay myself first?  What exactly does that mean? I heard financial gurus say that phrase over and over, and it just came off as cocky and glib.

“Want to become rich boy?  Well, it’s simple. Just pay yourself first!”  What?  You can’t just pay yourself into wealth. You have to create the wealth.  Build the business. Land the great job. Earn the money, and THEN you save money and become rich.  Right?

Wrong. Want to get rich? Pay yourself first. Want to pay off the mortgage in retire with money in the bank? Then pay yourself first. Have financial problems? Pay yourself first.

In fact, the less money you earn the more important it is to pay yourself first.

We feel frustrated because we sense time blowing

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8th Circuit BAP Denies Discharge of Student Loan

Posted in Student Loans

The Eight Circuit Bankruptcy  Appellate Panel denied an application seeking to discharge student loans because the debtor voluntarily quit a full-time job eight months prior to filing bankruptcy.

The debtor, Erin Kemp, is a 36-year-old single mom raising a 13-year-old daughter in Arkansas.  She obtained a psychology degree in 2010 and for the past 17 years she worked for a bank earning up to $45,000 per year.  However, eight months prior to filing bankruptcy she quit her full-time bank job due to problems with depression and anxiety and took a part-time job at Lowe’s earning $13.46 per hour. She supplemented her income by performing home daycare services as well.

The bankruptcy appeals court focused on the fact that the debtor was eligible for a zero-payment Income Based Repayment (IBR) for her student loans and that her financial problems were temporary in nature.  The

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Digital Signatures in Bankruptcy Update

Posted in Digital Signatures

Since February 5, 2018  debtors filing bankruptcy in Nebraska have been allowed to sign their petitions and other court documents using digital signatures pursuant to  General Order 18-01.  So what have we learned about the use of  digital signatures in bankruptcy since then?

I recently had the pleasure of speaking to an official at the Administrative Office of the U.S. Courts who was seeking some feedback on how digital signatures were affecting the bankruptcy practice. (Nebraska is the only bankruptcy court the nation that allows debtors to sign documents digitally.)  Here are some of my observations:

  • Clients absolutely love the convenience of signing documents digitally.  They no longer have to take time off work or drive through sometimes hazardous weather to sign documents.
  • Debtors are able to review documents in a less hurried fashion.  Instead of feeling rushed to

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Gage County Loses Court Appeal–Moves Closer to Chapter 9 Bankruptcy

Posted in Exceptions to Discharge, Real Estate Taxes

The 8th Circuit Court of Appeals has turned away an appeal of a $28.1 million dollar judgment awarded to 6 plaintiffs (commonly referred to as the Beatrice Six) for damages imposed by a federal jury for a reckless investigation and manufacturing false evidence orchestrated  by the Gage County Sheriff’s department. The plaintiffs spent two decades in prison for the rape and murder of Helen Wilson, but DNA testing revealed that the murder was actually committed by another individual.

Gage County previously hired a law firm to help plan a potential Chapter 9 bankruptcy case to avoid payment of the judgment (see Can Gage County Discharge Intentional Wrongdoing in Bankruptcy?),  and now that the appeal has been lost it appears that the county must make a final decision on whether to file a case.

This case is familiar to us, as it is to Nebraskans

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Do you need financial therapy?

Posted in Budgeting, Divorce

Money is a complicated topic. It is often very obvious what a person must do to improve their financial situation, but getting someone to change their financial habits and attitudes is hard. Good financial advice seems to go in one ear and out the other as clients continue to repeat the same destructive patterns over and over again.

At a core level, we generally know when we are behaving badly. An alcoholic is aware that they drink too much.  An obese person knows they need to eat a healthier diet. A gambler knows they cannot win back their losses at a slot machine.

Money disorders share this problem, but what makes them even more challenging is that a person may not even be aware that they have a disorder.  Instead, those who suffer from money disorders may actually think they are making wise money

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Digital Signatures Allowed in Nebraska Bankruptcy Court

Posted in Digital Signatures

Nebraska becomes the first bankruptcy court in the nation to allow debtors to sign bankruptcy petitions digitally.

An amendment to Nebraska Rule of Bankruptcy Procedulre 9011-1 became effective February 5 allowing attorney to use services like DocuSign and SignEasy to obtain client signatures on official court pleadings.

The immediate reaction? One central Nebraska attorney emailed me this:

This is fantastic! My client signed, we were notified, I signed, all before I could even drop her hard copy in the mail (mail leaves [our small central Nebraska town] at 12:30, so timing wise we have a completed document before the mail left the building)!  I am so pumped!

Nebraska is a big state spanning 450 miles across. It commonly takes 7 to 10 days to get documents signed and returned in the mail, and that is especially vexing when a client’s wages or bank accounts

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