Thursday, October 20, 2011
Ensure Your Fresh Start Is Not A False Start
Ensure Your Fresh Start Is Not A False Start
Even in today’s specialized legal
world, there are still some “general practice” attorneys who work in many
different areas of the law. A general practice attorney may represent clients
in family law like divorces with little or no property, minor criminal issues,
small land disputes, small probate estates, low dollar personal injury cases,
and the like. While a general practice attorney can successfully represent clients
in many legal matters, some areas of the law require a more specialized
knowledge.
From the outside, a bankruptcy
case seems like a simple process. You attend a couple education classes, there
are standardized forms that are filled out, you pay a filing fee, and finally
go to a meeting with the bankruptcy trustee. Simple, right? In some cases it is
that easy, but don’t let bankruptcy’s streamlined process fool you.
Bankruptcy is a mixture of state
and federal statutes, case law, procedural rules, and court and creditor
customs. General practice attorneys are just not as familiar with these various
rules and practices. An experienced bankruptcy attorney is also able to
identify problem areas, like preferential payments to creditors or equity
issues, which could have serious consequences to your bankruptcy case. Even the
timing when a bankruptcy is filed can have consequences to your case. For
instance, bankruptcy debtors lose their tax refund checks each year because
they filed either too early or too late.
Hiring an experienced bankruptcy
attorney ensures that your case will be filed correctly; that any potential
trouble areas in your case will be identified and discussed before your case is
filed; that you will be informed of how your case is progressing; and that you
will be represented in all communications with creditors and the bankruptcy
trustee. Hiring an experienced bankruptcy attorney gives you peace of mind
knowing that your case is being handled correctly and competently.
Hiring experienced counsel to
represent you has one more benefit – reputation. The local bankruptcy trustee
and judge are familiar with your bankruptcy attorney. They have confidence that
your petition and schedules are drafted correctly and that the attorney is
representing the client ethically and competently. That confidence is not
present with the general practice attorney. The trustee and judge are skeptical
that the paperwork is correct and wonder what has been “overlooked.” Consequently,
the case is scrutinized more than average.
If you are looking for an attorney
to represent you in your bankruptcy case, hire someone who has devoted his or
her practice to bankruptcy law. Your property and future financial success is
too important to risk. Hire an experienced bankruptcy attorney and ensure that
your fresh start is not a false start.
Filing Bankruptcy After Job Loss
Filing Bankruptcy After Job Loss
Many American families rely on
two incomes to pay the monthly bills and set a little aside as savings. When
one income is unexpectedly reduced or eliminated, the family is thrust
immediately into a crisis mode. Often there is not enough money to pay all of
the family bills, so touch choices must be made.
The first thing to do is to be
realistic and not overreact. It is important to use savings wisely during this
time and to safeguard retirement. Spending these funds to maintain your
lifestyle is not good financial management, and will have long-term
consequences. In most cases a substantial amount of cash and all of your
retirement funds can be protected if you need to file bankruptcy. Likewise,
most assets are protected during bankruptcy, so it is not necessary to sell
assets to pay creditors.
Second, prioritize your spending.
This may mean eliminating or reducing certain “luxuries” like premium tv
channels or inflated cell phone plans. Creditors must be prioritized also. For
instance, it may be more important to pay the car payment instead of a medical
bill. If you file a Chapter 13 bankruptcy, your secured creditors receive a
higher priority than unsecured creditors. That means your home mortgage and car
payment are paid before credit cards and medical bills. You keep the house and
car while unsecured creditors receive little or nothing.
Third, understand the
consequences of late payment and default. There may not be enough money to pay
all of your creditors, so what happens if you don’t pay a bill? In some cases
filing bankruptcy will actually help your credit over the long haul. Bankruptcy
stops all creditor action, including negative reporting to the credit bureau.
By filing bankruptcy you can avoid additional negative reports like late
payments, default, charge-offs, repossession or foreclosure.
Whether to file bankruptcy after
a job loss depends on a number of circumstances. The best advice is to consult
an experienced bankruptcy attorney and discuss your financial options.
Bankruptcy can help you reorganize your finances when there is not enough money
to pay all creditors. Your attorney can help you prioritize your spending and
protect your assets.
Report Indicates That Foreclosures May Soon Increase
Report Indicates That Foreclosures May Soon Increase
September foreclosure filings
fell 38% from one year ago, according to information released by RealtyTrac.com. This may seem like good
news, but there is reason to believe that the foreclosure rate may soon
increase.
First, the foreclosure process
came under attack during the past year prompting many banks to slow or
temporarily stop foreclosure proceedings. Banks and mortgage servicers have
taken corrective actions over the past twelve months, and there is no evidence that
previous sloppy practices are continuing. On the contrary, there is evidence
that banks are being more cautious in dealing with foreclosures. The time the
average foreclosure takes has increased to 336 days, up 18 days from the
previous quarter.
Second, while the number of foreclosures is down for the year, the number of September foreclosure filings increased 6% from August. “This marginal increase in overall foreclosure activity was fueled by a 14% jump in new default notices, indicating that lenders are cautiously throwing more wood into the foreclosure fireplace after spending months spent trying to clear the chimney of sloppily filed foreclosures,” says RealtyTrac Chief Executive James Saccacio.
“While
foreclosure activity in September and the third quarter continued to register
well below levels from a year ago, there
is evidence that this temporary downward trend is about to change direction,
with foreclosure activity slowly beginning to ramp back up," Saccacio
said in a statement.
If you find yourself unable to
pay your mortgage and facing foreclosure, get professional help. An experienced
bankruptcy attorney can provide you with options to catch up payments over
three to five years, modify your existing mortgage, strip away an entirely
unsecured junior lien, or even walk away from your house and the debt on your
own terms.
Once a bankruptcy case is filed,
the federal law stops all collection action – even foreclosure! Bankruptcy gives
you a “breathing spell” to organize your finances and propose a plan to
restructure your debt. In many cases debtors are able to save their homes while
discharging thousands of dollars in unsecured debts, including credit cards,
personal loans, and medical bills.
Don’t be another statistic! Get
the information you need to make a sound financial decision regarding your
home. Call an experienced attorney today and learn how the federal bankruptcy
laws can help you!
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