Stuck in a timeshare (or nowadays they are called vacation clubs or vacation ownership plans) you can’t get out of? You can get rid of a timeshare in a bankruptcy. If the timeshare is a contract agreement for points etc., then the contract can be rejected as an executory contract. If the timeshare is a secured interest (and many are), then you can provide in a Chapter 13 Plan to revest the title to the timeshare company/lender and they get it back.
For example, the Order Confirming Plan would provide for recording purposes:
Pursuant to 11 U.S.C. Sections 1322(b) (8) & (9), title to said property shall vest in Wyndham Vacation Resorts, Inc. Wyndham Vacation Resorts may file an unsecured claim for any resulting deficiency that may exist. Confirmation of this plan shall constitute a deed of reconveyance to this property upon recording with the XX County Recorder.
The facts for this one: (by the way, the client provided a copy of the written agreement to the attorney so the fees and proposed settlement amounts were verified)
The Debtor placed $54,000 with the debt settlement company. The estimated settlement amount was $27,500 and the debt settlement company charged a fee of $12,500. The settlement would cost them $40,000 on a $54,000 debt. Plus this would be a taxable forgiveness, so the Debtor would receive a 1099-C for $27,500. Why would anyone agree to this nonsense??
You can bounce back from bankruptcy way more quickly than you think. For instance, debtors who file bankruptcy can qualify for an FHA loan in as few as two years, or a conventional loan four years after filing.
What about credit scores? They can and frequently do go up right after filing.
Bankruptcy can help repair credit faster than trying to chip away at debt with predatory interest rates or judgments that last for 20 years. Most people that we talk with, if they decide to file, they usually wished they’d pulled the trigger and gotten that “fresh start” years before.
The Economic Injury Disaster Loan (EIDL) program is a loan and grant program offered by the U.S. Small Business Administration (SBA) to help small businesses and non-profit organizations recover from economic injury caused by a declared disaster. The EIDL program provides two types of financial assistance: EIDL loans and EIDL grants.
- EIDL Loan: The EIDL loan is a long-term, low-interest loan designed to help small businesses and non-profit organizations recover from economic injury caused by a declared disaster. The loan amount is based on the economic injury suffered, and can be up to $2 million. The loan must be repaid, with interest and fees, over a maximum of 30 years.
- EIDL Grant: The EIDL grant is a grant that does not have to be repaid, and is designed to provide immediate relief to small businesses and non-profit organizations suffering economic injury from a declared disaster. The grant amount is up to $10,000 and is meant to help cover basic needs such as rent, mortgage, and utilities, while the business is waiting for the loan application to be processed.
The Brunner standard is a legal test used in certain circumstances to determine whether a borrower’s federal student loans can be discharged in bankruptcy. The test was established by the U.S. Supreme Court in the case of Brunner v. New York State Higher Education Services Corp. (1987).
The Brunner test has three prongs:
- Hardship: The borrower must prove that repaying the loans would impose an undue hardship on the borrower and their dependents.
First, and I must stress, EIDL loans are not forgivable. They were intended to help small businesses recover from the economic impacts of the Covid-19 pandemic.
However, EIDL Advance funds are like grants and do not have to be repaid.
More information is available on the SBA website: https://www.sba.gov/funding-programs/loans/covid-19-relief-options/eidl