Voicemail Tag

I take pride in the fact that as a solo practitioner, I can speak to my clients directly without them having to run a gauntlet of call center staff.

Unfortunately, the physical laws of the universe prevent me from being in all places at all times.  Sometimes, when a client calls me, they get my voice mail because I am in court, talking to another client, or on the phone with someone else.  But unless the call clearly does not require a response, I will return all messages as soon as I get them.

I am continuously baffled by some people’s reluctance to use voice mail. If I don’t answer the phone, it’s not because I’m ignoring you. Hanging up and calling and hanging up and calling in rapid succession doesn’t magically teleport me back from court; and if I’m meeting with a client, the rapid-fire calls are a real nuisance.

Call once, leave a message, and I will return your call (or e-mail you, if an e-mail is more appropriate) as soon as I get your message.

And if you do get my voice mail, actually tell me what you’re calling about.  That way – in the off chance I call you and get YOUR voice mail (because you also cannot be in all places at all times), I can at least get an answer to you without having to play voicemail tag.

Prime Rate

Historically, the prime rate was something that changed several times per year.  That was true until the market crash and recession in 2008 when – in December 2008, the prime rate was adjusted to 3.25% and remained unchanged for over 7 years.  Then, the day after the 7 year anniversary of its last change (on December 17, 2015), prime rate finally budged off its historic low by a quarter percentage point to 3.50%.  Almost one year later, it has risen another quarter percentage point, now standing at 3.75%.
But the more interesting item is that the federal reserve anticipates raising the rate three more times (presumably by similar gradual increases) in 2017.  So by the end of the year next year, we’re likely going to see a prime rate of 4.5% interest.  This still isn’t terrible.  Rates were at 8.25% in 2006, and if you go back to 1984, they were as high as 13%.
What does that mean for you?  Well, generally, it means that it will become more expensive to borrow money in the future.  Specifically in bankruptcy, it means that the “Till interest” rate (the rate used to pay certain secured debts – mostly vehicle loans and other loans secured by personal property in Chapter 13) will go up slightly, since the “Till” rate is based on the prime rate.
Again, a quarter point interest rate hike isn’t a huge amount.  For a thousand dollar loan over 5 years, the added amount paid in interest is only about $7.  But that number obviously compounds for larger balances (say a vehicle with an outstanding balance of $20,000), and the difference between prime rate last week and prime rate a year from now will likely be a full percentage point.  So that same $20k auto loan could be more than $550 more expensive if your bankruptcy case is filed a year from now.
So with that in mind – a little extra incentive – if you need to file Chapter 13 Bankruptcy for any reason – to get your case filed sooner rather than later.  The applicable Till rate is based on the prime rate at the time the case is filed.

Source of Funds

There is a misunderstanding among a few people who elect to go through Chapter 13.  I want to emphasize “few” – this is by no means a common misunderstanding.  But I’ve had to debunk this myth one too many times, so it’s time to put this out there and clarify.
The Chapter 13 Trustee is NOT an independently wealthy individual who pays all of your debts for you, and then you pay the Trustee back over the course of your Chapter 13 Plan.
The Chapter 13 Trustee acts as a conduit for your payments to creditors.  You make payments to the Trustee, and the Trustee then redistributes those funds to your creditors in a manner (order of priority and amounts) that are dictated by the terms of the Plan, statutes, and other regulatory policies.
Your creditors are enjoined from pursuing you separately for their unpaid balances while you are in bankruptcy, until at the end when you ultimately receive your discharge from certain remaining unpaid balances.
If you default – if you make less than your full monthly plan payment or if you stop making your plan payments altogether – the Trustee simply will not have funds to pay your creditors.  It should not come as a surprise to anyone that individual creditor accounts show no recent payments from the Trustee if you have stopped making plan payments to the Trustee.

Trustee Garcia’s Financial Management Course

As a policy, my clients who file for Chapter 13 Bankruptcy are not charged for the second counseling course under the assumption that they will take the free version offered by Trustee Garcia’s office.  This policy has been in place almost as long as the course has been offered (back when Trustee King’s office implemented it) because it is (1) free and (2) better – in my opinion – than the online versions of the course that are available out there.

Due to declining attendance, Trustee Garcia’s office is considering discontinuing the course in the near future.  Although no final decision has been made yet, this is a possible and even likely scenario.  Those of you who have already filed your Chapter 13 bankruptcy case (Chapter 7 debtors are ineligible for the free course) but not yet taken the second counseling course, please do so immediately, before the program is discontinued.

Some 2017 dates have been announced.

Oshkosh location (Chapter 13 office):
Thursday, February 23, 2017             12:00PM – 4:00PM
Wednesday, April 12, 2017                8:00AM – 12 Noon
Monday, June 19, 2017                     12:00PM – 4:00PM
Friday, August 18, 2017                    8:00AM – 12 Noon
Thursday, October 12, 2017              12:00PM – 4:00PM
Monday, December 4, 2017               8:00AM – 12 Noon

Green Bay Location (NWTC):
Friday, January 13, 2017                    8:00AM – 12 Noon CC 145
Monday, March 20, 2017                   12 Noon – 4:00PM CC 145

Customer Service

After filing for bankruptcy, MOST debtors will not be speaking on the phone to MOST of their creditors.  But some will.  And talking to the right person may make the difference between a productive phone call and a hair-pulling experience.
Some of you may need to contact your creditors to arrange for reaffirmation agreements after filing a Chapter 7 Bankruptcy.  Some of you may need to contact your creditors to make post-filing mortgage payments after filing a Chapter 13 Bankruptcy.  Still others may need to call creditors for different reasons entirely.
But no matter why you’re calling a creditor, if you dial a generic 800 number to reach customer service – particularly with the bigger national creditors like Bank of America, Wells Fargo, Capital One, Citi, and others – odds are the first person you speak to isn’t going to know the first thing about bankruptcy.
Most front-line customer service agents are trained only to answer basic questions, and many of them have little training and little experience, as the revolving doors on those jobs spin quite rapidly.  Even higher level supervisors often aren’t particularly helpful.
If you have filed for bankruptcy, the very first thing you should tell any creditor you contact – no matter the reason – is that you have filed for bankruptcy and ask to speak to their “bankruptcy department” or “loss mitigation department”.
It’s very important that you only do that AFTER you have filed for bankruptcy.  Remember that hiring an attorney to file for bankruptcy is not synonymous with actually having filed your case.  If you tell a customer service agent that you have filed for bankruptcy when you actually have only hired an attorney, you’re going to confuse the hell out of the representative.
Once you reach the bankruptcy department, you can ask questions about reaffirmation agreements, make post-petition payments on mortgages, and so forth – and you’ll probably have an easier time of it since the people in those departments tend to have better training and are specifically trained to deal with bankruptcy issues.

Chapter 13 Defaults and Second Chances

If you’re the “TL;DR” type – skip ahead to the bottom of this post – that what’s written in red.  Because this post contains very important information.
For anyone who has ever filed a Chapter 13 Bankruptcy case, there is an obligation to make monthly plan payments to the Chapter 13 Trustee, who – in turn – makes distributions to certain creditors (read more here on what gets paid and what doesn’t get paid in Chapter 13).
Homeowners in Chapter 13 also have an additional duty to make monthly mortgage payments (unless they are surrendering their home or if their future payments are being paid through the bankruptcy (known as a conduit mortgage provision).
A default on either one of these payments will eventually trigger a motion – a motion to dismiss the bankruptcy case, in the event of a default on plan payments, or a motion for relief from stay, in the event of a default on mortgage payments.
For as long as I can remember, conventional wisdom has been that either type of default can be resolved with an objection and the almost certain guarantee that the debtor would be given a second (or third or fourth) chance under what we call a doomsday provision.  A doomsday provision is a period of time (usually 6 months) during which all plan or mortgage payments must be made, and that there are no second chances in the event of a default during the doomsday provision.  Also, plan payments would often have to increase to either accommodate a supplemental claim for the defaulted mortgage payments or to otherwise get the debtor caught up on missing plan payments.
But that conventional wisdom seems to be changing – at least with one judge.  While waiting my turn for a telephonic confirmation hearing several days ago, I was able to listen in on several hearings regarding motions to lift the automatic stay (debtors who had defaulted on their mortgage payments).  From just the handful of hearings I was able to observe, it seemed clear that the judge was no longer willing to hand out doomsday provisions and “second chances” that we had become so accustomed to  and taken for granted in the past.
This is not to say that a motion for relief from stay cannot be defeated.  But it seems that the standard for getting that second chance has been raised significantly.
If I were to summarize and characterize a new doctrine based on the hearings I observed – I would say that motions for relief from stay will be granted unless the debtor can demonstrate a good faith effort to make mortgage payments and remain current on those payments.  Cases in which no mortgage payments have been made since the inception of the bankruptcy case and cases where no mortgage payments have been made in a long time may now be far more susceptible to having the stay lifted, even if an objection is timely filed.
The obvious disclaimer here is that this is an observation based on a handful of hearings in front of a single judge and on a particular type of motion.  But it is not unreasonable to expect that our other judges will adopt a stricter policy on issuing second chances to debtors, and that these policies may also be applied to motions to dismiss on account of defaulted plan payments.
I can’t say that I blame this particular judge for this new approach.  I have always cautioned my clients that there is no 100% guarantee that we will prevail on an objection to a motion to dismiss or a motion for relief from stay.  But now, what we used to take for granted as a 99% certainty may have been knocked down quite a few percentage points.
What to take away from this post?
If you default on your Chapter 13 Plan payments or your post-filing mortgage payments – DO NOT TAKE FOR GRANTED that you will be able to prevail in objecting to a Motion to Dismiss or a Motion for Relief from Stay.  Obviously, sometimes things happen that cause these defaults, and I am not at all suggesting that there is a strict “no second chances policy”.  But the more you can demonstrate a good faith effort to make good on these payments, the better chances you will have of earning that second chance.


While your bankruptcy case is pending, it is important to keep your attorney apprised of any changes of your contact information.  Not only is it important so that we can keep in touch with you, but so we can also inform the bankruptcy court of any change of address.  This way, you won’t miss out on any official notices filed with the court.
But hey – your attorney probably isn’t the only important person in your life who you need to make sure has your new address.  And as someone who has moved many times in his life – I know that it’s daunting trying to think of a list of everyone you need to send a notice to.  And invariably – some folks get missed.
That’s why filing a change of address with the USPS is so critically important.  It’s fast, easy, and free (if you go to the post office and do it in person).  If you do it online, it costs a whopping one dollar.
Not only will the post office forward any mail addressed to your old address to your new address, but those envelopes will be specially marked so that you can see who is still sending mail to your old address.  Then you can notify those people as you remember / become aware of them.
In short – there is NO EXCUSE for not receiving important communication from either the bankruptcy court or your attorney just because you moved.  Mail forwarding is easy, and if you want to register for it online, you can do it right here:

New Median Income Levels, Effective 11/1/2016

New median income level figures went into effect today.
In the State of Wisconsin, the median income level rose for a household of 1 from $44,817 to $47,804.  For a family of 2, it went up from $59,668 to $62,130.  For a family of 3, from $69,492 to $75,230.  And for a family of 4, from $85,961 to $88,133.
What does this mean for you?  Since the median income levels rose across the board, it means people who are hoping to qualify for Chapter 7 will have an easier time qualifying (based on income) now than yesterday.  Median income levels change about once every 6 months.
Although I don’t have historical data readily available – my recollection is that these are the highest numbers I’ve seen since I began practicing 10 years ago.

How to use CCAP

Happy Halloween!

Either you have been sued or you think you’re about to be sued.  Maybe you lost paperwork.  Maybe you moved recently and paperwork has been sent to your old address.  Either way – what can you do to track the status of lawsuits?
If you’re being sued in Wisconsin, we’ve got a handy tool called CCAP.  Although a lot of people aren’t wild about CCAP because it’s readily-accessible public information about things most people find embarrassing – it’s an incredibly helpful tool to keep track of cases so you’re not missing out on any important deadlines.
The good news – for my bankruptcy clients – is that your bankruptcy case will not show up on CCAP.  Why?  Simple.  CCAP is for Wisconsin state court cases.  Bankruptcy cases are filed in federal court.
How do I use CCAP?
  1. Point your browser to https://wcca.wicourts.gov/
  2. You’ll need to read the agreement and hit the “I Agree” button to proceed.  You might also be prompted to pass a CAPTCHA test used to screen out data-mining robots.
Next, you’ll reach the simple search screen.  There is an advanced search option, too, but for most uses, the simple search will work just fine.  If you already know that a lawsuit has been filed against you and have the case number, the quickest way to get specific information about that case is to search by citation (see the blue circle in the screenshot below).  Simply select the county in which the lawsuit was filed from the drop down list, then type in the case number.
The format of each case number is the year the suit was filed (two or four digits), the case type (2 letters, usually CV or SC), and the serial number. You can leave out any hyphens and the first two digits of the year.  If the serial number has any leading zeros, you can omit those, too.  For example: 2016-CV-00001234 can be shortened to 16CV1234.
If you are checking to see IF a lawsuit has been filed against you, or if you just don’t know the case number, then search by your name (see the red circle in the screenshot above).  You might want to do multiple searches for alternate spellings of your name (e.g. Jon, John, Jonathan, Jonothon), common misspellings, maiden names, or other aliases you might have used.  If you have a common name, you might want to add your middle initial to help minimize the number of search results.
You’ll get a results page that will look something like this.  You can click on any of the case numbers to get more detail about a case.  The results will be sorted by year, with the most recent cases appearing at the top (although they are not necessarily sorted in order of filing date within a single year).
How can using CCAP help me?
There is all sorts of information you can get from CCAP.  First – obviously – to find out what cases, if any, have been filed against you.
Once you find a case and click into it, you’ll see a screen that looks like this:
If you’ve recently moved and you’re not getting proper notices of the lawsuit, you can check CCAP to see which address they have listed for you (under PARTY DETAILS).  If they do not have your correct address, you can contact the clerk of courts and find out how to update your address so that you receive the notices you need to receive.
(This particular case was filed very recently and involves a John Doe defendant, so there are no addresses shown here.  Even if there were, I would have redacted them from the screenshot for privacy reasons.)
You can also get addresses and contact information for other parties to the lawsuit whom you may need to contact – including any attorneys who are representing the opposing party (again – not shown in this example).
The other most useful tool is FUTURE COURT ACTIVITY.  This is where you can find out about any scheduled hearings or other deadlines that you need to be aware of.
For example – let’s say you have a home in foreclosure.  A judgment was entered 6 months ago.  A Sheriff’s Sale is scheduled in about 2 weeks.  Since you have to be out by the Confirmation of Sale, you can use CCAP to watch for the scheduling of the Confirmation Hearing.  Once that is scheduled – it will give you a pretty good idea of when you need to be out in 99% of cases.

I lost my job. Should I file for bankruptcy now?

Timing when to file bankruptcy – particularly around a period of unemployment or changed employment status – can be tricky, and it really depends on what your goals are.
Let me give you a couple examples…
Let’s say you’re single person making $30,000 a year, struggling with credit card debt, and worried about wage garnishments.  If you suddenly lose your job, there’s no real reason to rush to file for bankruptcy while unemployed.  While unemployed, you’re essentially garnishment-proof (you don’t have any wages to have garnished).  In Wisconsin, if you qualify for state aid (BadgerCare or food stamps), you can protect yourself from wage garnishment for at least six months after you return to work – giving you ample time to get a bankruptcy case prepared and filed before the garnishment can kick back in.
Let’s take the same example, but instead of making $30,000 a year, you’re making $50,000 a year.  You’re still struggling with debt (remember that insolvency is not JUST about your income, but your debt to income ratio).  But because of your income, you’d be looking at a Chapter 13.  If you know that your job is in jeopardy (e.g. your company is going through a series of lay-offs), there may be a strategic advantage to waiting to file until you’ve lost your job and can qualify under Chapter 7.  This is something you’d consider if there were no other benefits that a Chapter 13 could confer upon you, and the likelihood of job loss was high and the likelihood of finding new employment soon after was low.
Now let’s say that you’re currently unemployed, and because of this, you have defaulted on your mortgage.  You really want to keep your house, and you think you’ll be employed again soon.  In this case, you’d need to wait until you found employment so that you can fund the Chapter 13 plan that would stop the foreclosure action and get you caught up on the mortgage arrears.
These are all over-simplified examples.  Even if you think one of these three describes you perfectly, there are all sorts of nuanced details that could change an attorney’s recommendation or advice.  The point is to make sure that you communicate your goals and wishes clearly with your attorney, and that you not only discuss your current employment status, but also any expected changes in employment status in the immediate future.