Oklahoma law is very specific regarding the type and amount of jewelry that a person filing bankruptcy can protect and keep.

Oklahoma law allows a person filing bankruptcy to protect or “exempt” up to $3,000 worth of wedding and anniversary rings.  See 31 O.S. sec. 1(A)(8). If a married couple file bankruptcy together, then each spouse may claim the $3,000 exemption and protect up to $6,000.00 worth of wedding and anniversary rings.

Notice that the Oklahoma exemption statute says you can only protect wedding and anniversary rings. It makes no provision for other types of jewelry such as earrings, necklaces, bracelets, watches or rings other than wedding and anniversary rings.

However, in the 16 years that I have been a bankruptcy lawyer, I have never had a client have to surrender any jewelry to a bankruptcy trustee. That’s because any jewelry that my clients have owned and properly disclosed has been of minimal value below the value that would make it worth a trustee’s time to liquidate and administer on the behalf of unsecured creditors.

If a client thought that the value of his or her wedding or anniversary rings was more than the allowed $3,000.00, then I would advise the client to obtain an appraisal of the ring. Most often, the resale value of wedding and anniversary rings is far less than the sentimental value we attach to such items.

A written appraisal will help establish that the true fair market value of the jewelry is below the allowed $3,000.00.  Or if the ring is worth more than the allowed $3,000.00 but not substantially more, a written appraisal can convince a bankruptcy trustee that the jewelery is not worth enough in excess of the allowed $3,000.00 to make the effort to liquidate worthwhile.

That’s because if the bankruptcy trustee decided to take the ring and sell it for the benefit of your creditors, the trustee would have to pay you the first $3,000.00 from the sale proceeds. And unless the ring is extremely valuable, the amount remaining after deducting your $3,000.00 and the trustee’s expenses of liquidation would likely leave very little to be split among your unsecured creditors which would make the whole liquidation process not worth the effort.

So while Oklahoma law only allows you to protect your wedding and anniversary rings, if the rest of your jewelry consists of costume jewelry and other pieces with a low resale value, the probability that you will lose your earrings, necklaces and bracelets is extremely low. A bankruptcy trustee just isn’t going to be interested.

On December 13, 2011, President Obama signed into law H.R. 2192, the “National Guard and Reservist Debt Relief Extension Act of 2011,” which renews an exemption in  11 USC § 707(b)(2)(D) for reservists and National Guard members from Chapter 7 bankruptcy means-testing requirements. The bill amends a 2008 law to make reservists and Guard members that have served on active duty or homeland defenses for at least 90 days since Sept. 11, 2001 eligible for the exemption through 2015.

The income figures used to determine whether or not a person qualifies to file Chapter 7 bankruptcy change approximately twice a year and new numbers will be effective November 1, 2011.

The United States Trustee Program has posted new “Census Bureau Median Family Income By Family Size” figures that apply to bankruptcy cases filed on or after November 1, 2011.

A review of the new numbers shows that it will be a little easier to qualify for Chapter 7 bankruptcy for all Oklahoma households consisting of only one person.

However, it will be slightly more difficult to qualify for Chapter 7 bankruptcy for individuals who live in a household consisting of more than one person.

The new median income figures for Oklahoma households are:

• $37,466 (1 person household)
• $48,313 (2 person household)
• $53,332 (3 person household)
• $60,395 (4 person household)

*Add $7,500 for each individual in the household over 4.

If gross household income falls below the applicable numbers, an individual or married couple passes the Means Test and automatically qualifies to file a Chapter 7 bankruptcy.

A person whose household income exceeds these figures may still qualify for Chapter 7 bankruptcy if he/she has enough allowable expense deductions to offset his/her above median income or if the projected amount of disposable income would pay less than 25% of the total unsecured debt.

A person who fails the Means Test and does not qualify to file Chapter 7 bankruptcy may choose to file a Chapter 13 bankruptcy instead.

Source: The United States Department of Justice

A recent study reveals that the rate of college graduates filing for bankruptcy increased 20% over the past five years.

The study by the Institute for Financial Literacy shows the percentage of debtors with a bachelor’s degree rose from 11.2 percent in 2006 to 13.6 percent in 2010. During the same period the percentage of debtors with a high school diploma, or who did not finish college, declined.

“The Great Recession has had a dramatic impact on the bankruptcy filings of American consumers across the economic spectrum — including college-educated, high-income earners,” said Leslie Linfield, executive director and founder of the Institute for Financial Literacy.

Linfield said the group historically most affected by bankruptcy is low-income consumers without college degrees. That group still accounts for the largest share of bankruptcy filers.

But since the study was first conducted in 2006, there has been a gradual shift toward higher income earners. In 2006, only 5.5% of the bankruptcy filers participating in the report made more than $60,000, but this increased to more than 9% by 2010.

The study involved more than 50,000 respondents and ran from 2006 to 2010, tracking the financial status of debtors since the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act.

Source: Washington Post.

I’ve represented a number of military personnel in bankruptcy and none of them have told me that the act of filing bankruptcy negatively affected his or her security clearance.

While that’s no guarantee that a security clearance never will be negatively affected by filing bankruptcy, my experience shows that it’s generally unlikely.

Here’s what the Air Force Academy’s web site has to say about this issue:

“The status of your security clearance can be affected, but it is not automatic. The outcome depends on the circumstances that led up to the bankruptcy and a number of other factors, such as your job performance and relationship with your chain of command. The security section will weigh whether the bankruptcy was caused primarily by an unexpected event, such as medical bills following a serious accident, or by financial irresponsibility. The security section may also consider the recommendations and comments of your chain of command and co-workers. This is an issue that can be argued both ways, so as a practical matter your security clearance probably should not be a significant factor in making your decision about whether to file bankruptcy. The amount of your unpaid debts, by itself, may jeopardize your clearance, even if you don’t file bankruptcy. In that sense, not filing for bankruptcy may make you more of a security risk due to the size of your outstanding debts. By the same token, using a government-approved means of dealing with your debts may actually be viewed as an indication of financial responsibility. Eliminating your debts through bankruptcy may make you less of a security risk. There is no hard and fast answer here, with one exception: it never hurts to have a good reputation with your co-workers and your chain of command.”

My personal opinion is that a member of the military who is up to his eyeballs in debt is more likely to be a genuine security risk than one who has resolved his financial difficulties through the legal process of bankruptcy. A service member who is drowning in debt is likely to be experiencing high levels of stress that could make him vulnerable to compromise whereas the service member who has filed bankruptcy and received a fresh start is no longer battling the stress associated with serious debt problems.

I’m seeing more and more people who are contacting me to file bankruptcy after a garnishment has hit their paycheck or bank account. And after the wage garnishment takes the customary 25% of their take-home pay, they are in a real world of hurt.

I always wish that they had contacted me sooner so that I could have prevented the garnishment from happening in the first place.

Filing bankruptcy will both prevent and stop the garnishment of a paycheck or bank account.

The recent economic downturn has increased the number of people who are behind on their credit card payments and other debt payments. And the creditors are filing lawsuits by the millions in the hopes of being able to easily garnish the debtors’ paychecks and bank accounts.

You see, most people who get sued never respond to the lawsuit. That makes it really easy for the creditor because then the creditor automatically wins the lawsuit. The creditor doesn’t even have to prove that the consumer owes the creditor the money. And the creditor doesn’t have to justify to the judge the interest charges and penalties they often tack on. The creditor just get everything it asks for when the consumer doesn’t get involved in the lawsuit.

After winning the lawsuit, the creditor can secure a court order to seize part of the debtor’s paycheck or the funds in a bank account, a procedure called garnishment.

The New York Times reports that wage garnishment across the United States is increasing rapidly, anywhere from 30 to 120% depending on the state.

Why don’t consumers defend themselves more often when they are sued?

Well believe it or not, some consumers do not even know they are being sued.  While the law requires that a person be given formal notice of a lawsuit, some process servers have been caught skipping actual service of the lawsuit and then forging the proof of service that is filed with the court.

However, in most cases, consumers are served properly but still do not offer a defense. Many cannot afford to hire a lawyer and are intimidated or confused by the legal process. So they do nothing.

And even when a consumer does attempt to defend himself, many times he is ambushed by the collection lawyer and enticed to sign a settlement agreement that is not in the debtor’s favor. Furthermore, once a debtor signs a settlement agreement, a new contract has been entered with the creditor. This resets the amount of time the creditor has to collect on the debt if the debtor defaults under the settlement agreement.

Filing bankruptcy can quickly solve the whole problem of garnishment of paychecks and bank accounts.

The moment a bankruptcy case is filed, all further collection activity is prohibited. All law suits must stop right where they are and garnishments are prohibited. If a garnishment has already started, it must stop immediately. And if a single creditor has garnished in excess of $600.00 within the 90 days before the bankruptcy was filed, the creditor can be required to return the garnished money to the consumer.

If you are afraid that your paycheck is about to be garnished or worse yet if your paycheck is already being garnished, contact me today to discuss how bankruptcy can prevent or stop the garnishment. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. Or simply pick up the phone and call me at 918-615-8260. I’ll answer all of your questions and give you straight answers on the pros and cons of bankruptcy as related to your specific situation.

As I recently wrote, you don’t have to be a U.S. citizen to file bankruptcy in the United States.

Just like many U.S. citizens, there are many non-citizens living legally in the United States who are drowning in debt and contemplating filing bankruptcy. One big difference between the two groups is that many of the non-citizens worry that filing bankruptcy could hurt their immigration status.

The good news for non-citizens is that filing a bankruptcy generally will not affect immigration status or citizenship applications. Immigration papers do not ask if you have every filed bankruptcy and bankruptcy documents do not ask about your citizenship or immigration status.

The things that may negatively impact immigration status are criminal activity and other evidence of negative moral character.

It’s not a crime to file bankruptcy. In fact, filing bankruptcy is a perfectly legal and common way to deal with serious debt problems.

And while in times past the act of filing bankruptcy may have been considered an act of questionable moral character by some, with over one million consumer bankruptcy cases being filed on an annual basis these days, bankruptcy has become a common, accepted practice.

Certain criminal activity will mandate a non-citizen’s deportation. And crimes evidencing moral turpitude such as issuing fraudulent checks, fraudulent credit card use, or providing fraudulent information to the federal government (such as by filing inaccurate bankruptcy documents) could negatively impact a non-citizen’s immigration status.

Therefore, it is extremely important to be absolutely truthful when completing and filing bankruptcy documents.

If you’re an honest, non-citizen who has serious debt problems, bankruptcy may be a good option for you. Bankruptcy can open the door to a better financial situation and a brighter future. Bankruptcy can help you get out of debt so that you can become a productive member of society who is less likely to look to the government for financial assistance. The United States government understands this and therefore bankruptcy can actually work to benefit a non-citizen who is seeking to become a U.S. citizen.

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. Or simply pick up the phone and call me at 918-615-8260. I’ll answer all of your questions and give you straight answers on the pros and cons of bankruptcy as related to your specific situation.

No. Surprisingly, a person doesn’t have to be a citizen of the United States to file a bankruptcy case under the U.S. Bankruptcy Code.

Bankruptcy is available to anyone who either lives or owns property in the United States.

The Bankruptcy Code states that “Notwithstanding any other provision of this section, only a person that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title.” 11 U.S.C. Section 109(a).

There is no requirement of citizenship in the Bankruptcy Code.

A person who lives in the Unites States, whether a citizen or not, must have established residency in the state or territory where he plans to file bankruptcy. A person can file bankruptcy in the state or territory where he has lived the greatest part of the previous 180 days.

And what’s more, a person who does not live in the Unites States can still file bankruptcy in the state or territory where he owns real or personal property.

Both citizens and non-citizens filing bankruptcy will be required to prove their identity and must have a valid photo ID and a valid Social Security Card or Individual Tax Identification Number (ITIN).

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. Or simply pick up the phone and call me at 918-615-8260. I’ll answer all of your questions and give you straight answers on the pros and cons of bankruptcy as related to your specific situation.