Of no surprise to this Jacksonville Bankruptcy Lawyer, The Wall Street Journal reports a record 14% of American households with mortgages were behind on payments or in foreclosure in the third quarter, according to the Mortgage Bankers Association. The new figures, according to The New York Times, “. . . underlined the level of stress on a large segment of the country, a situation that could snuff out the modest recovery in home prices over the last few months and impede any economic rebound.”

In a conference call with reporters, Jay Brinkmann, the MBA’s chief economist, said, “The outlook is that delinquency rates and foreclosure rates will continue to worsen before they improve,” said.

But Brinkman also said, “Clearly the results are being driven by changes in employment.”

Really?  How about the mortgage banker’s unwillingness to modify mortgages in a meaningful way (ie. reduce principal balances to fair market value)? As reported in The Washington Post, “the foreclosure problem is building despite a massive government program that pays lenders to lower borrowers’ payments,” and The New Times said, “Unless foreclosure modification efforts begin succeeding on a permanent basis — which many analysts say they think is unlikely — millions more foreclosed homes will come to market.”

As I previously discussed, one cause of this bleak outlook is the Option ARM, which is set to begin destroying California and Florida in January 2010.

What is the middle class to do?  Fight the foreclosure and/or strip the second mortgage.

In my small state of Rhode Island, there are 5,878 licensed attorneys.  RI only has a population of 1,050,788 people.  That is one lawyer for every 178 people. 

Because each attorney is licensed in the general practice of law, he can represent just about any matter that comes through the door. He can handle a murder case on Monday, a speeding ticket matter on Tuesday, and decide on Wednesday to start a bankruptcy practice. 

With this horrible economy, many general practice lawyers have done just that.  Print new business cards, rent a huge billboard and declare their bankruptcy practice OPEN FOR BUSINESS.

Bottom line: there is no shortage of lawyers willing to take your bankruptcy case.  But which lawyer should you hire?

Do you call the lawyer with the biggest bankruptcy advertisement, or do you take the bargain-basement lawyer who advertises on place-mats at your favorite Chinese restaurant?

Read the rest

What I’m about to say borders on heresy, and I’m pretty sure I’m going to get flamed by my colleagues and friends for saying it.  I’m willing to take the risk, and I invite everyone to submit their comments to this post to let me know what they think.

If you’re thinking of filing for bankruptcy I have a piece of advice for you – don’t.

That is, don’t file for bankruptcy unless you’ve taken the time to thoroughly assess your situation and whether bankruptcy is right for you.  After all, it’s a last resort.  But more to the point, it’s a road you don’t want to travel until you’ve had the chance to know all of your options.  That includes:

• working directly with your creditors to reduce payments or interest rates
• credit counseling through a reputable credit counselor such as CCCS or GreenPath

Many people fall behind on their credit card payments and immediately run scared to a bankruptcy lawyer to file a case.  When that happens, you’re operating out of pure fear rather than making an educated decision.  And though a good bankruptcy lawyer will talk with you about all of your options, it’s best to take the time to act in a clear-headed manner.

IMPORTANT NOTE: Read what I wrote above.  I said, “reputable credit counselor.”  Emphasis on “reputable.”  Don’t call the people who advertise on late-night television and make bold promises of a happy life tomorrow. Read the rest

Medical problems, even when you have insurance, are an increasingly large cause of bankruptcy cases.  Some groups are trying to help folks with poor or non-existent coverage to get care.  The events are being set-up — and attended — like rock concerts.

One organization setting up large events with volunteer medical staff and doctors on hand for all-comers is the National Association of Free Clinics.

And this Saturday, November 21st, they are sponsoring an event in Little Rock.  And Kansas City will host one on December 9th and 10th.

If you need help, get in line early.  If you have medical training, consider volunteering.  If you have some spare cash, consider a donation.  And if you don’t think there’s a health care crisis, feel free to check out these mega-events as they pop up around the country.

Just like we used to sponsor them for Third World countries.

This is one category of cases most bankruptcy lawyers would be happy to see prevented.

Sounds like a silly command doesn’t it?  But by breathing you can calm your mind and elevate your mood.  In fact Dr. Weil states; “Practicing regular, mindful breathing can be calming and energizing and can even help with stress-related health problems ranging from panic attacks to digestive disorders.” Dr. Weil has three breathing exercises to help you gain control over your mind state. Breathing may be the key to your salvation during these hectic times.

Job layoffs, creditor collection calls, divorce and debt are all stressors which are destroying the American dream.  The experts say the recession is over and life is grand.  This statement only seems to pour salt into the wound of reality that life is tough for everyone.  Everyone that is who does not have parachute retirement package rewarding their bad financial behavior.

You did not get into debt or a bad marriage over night.  You are not going to get out of these situations over night.  Breathing gives you a chance to take a moment and reflect.  Reflecting gives you the opportunity to calm your physical condition.  Reflecting also gives the opportunity to outline a game plan for recovery.  During this reflection you may discover that that job layoff is an opportunity to pursue a life long dream.  A divorce may give you the opportunity to get out of a bad marriage and find your true companion.  Sound goofy?  Maybe.   But why not take a chance be goofy, take a moment to breathe and turn a negative into a positive opportunity to change.

Remember that knowledge is power and the more knowledge you have about controlling stress the more power you will have to control stressful situations.

Written by Kansas City Missouri Bankruptcy Attorney, Rachel Lynn Foley.

In today’s Internet world social media is all the rage.  Facebook, Twitter, Linkedin, etc… are all sites where you can find old friends, colleagues, and your bankruptcy attorney, judge and/or trustee.  If you are in bankruptcy you might be excited to find your trustee, attorney and/or judge on Facebook and request that they be your friend.  You think you will have the inside track for information on your case, but think again. Read the rest

If you are considering filing a bankruptcy, the best advice I can give you is to discuss your financial situation with a competent bankruptcy attorney.  She will tell you that for most consumers, there are often two options: file a Chapter 7 or a Chapter 13 bankruptcy.

There are many differences between these two types of bankruptcies and many reasons to pick one over the other.  Here is my list of 13 reasons that a Chapter 13 might be the right choice:

1. Flexibility: you can dismiss the case at any time or even convert it to a Chapter 7.  You can modify a plan if income changes or you decide to give up a house or a car.  You can refinance or sell a house during the plan.

2. A Chapter 13 will save a house from foreclosure as long as you can make the payments. Read the rest

Unless you are a customer of the bank, Houston bank First Bank in Houston refuses to break a $100.00 bill into smaller bills. My son experienced this recently when he needed to pay someone in exact cash and only had a $100.00 bill.

What are banks thinking?  I could understand if it was a check, but U.S. currency?!!!  Maybe I need to file a complaint with the banking commission.  Banks are really pushing the limits these days.   Are banks going to start charging to break currency into smaller currency?  I suppose this is a real possibility since they charge people to take change.  If banks keep adding fees, they may well find themselves without any customers.  Just my two cents!

I don’t mean to alarm you, but the folks at Bankruptcy Bill have organized what appears to be the first ever Bankruptcy Song Contest.

So whether you’re a debtor, a creditor, a bankruptcy lawyer or a “Bankruptcy Lover,” here’s your chance to express yourself through song.  The winner will be selected by readers voting.   Check out the details here.

What’s the incentive?  They’re going to announce the winner in a future Bankruptcy Bill cartoon and they’ll include the winner as a character in the cartoon.  That’s right, you and Bankruptcy Bill–or maybe BAPCPA Man–standing shoulder to shoulder in 2-D.

The other incentive is that it’s for a good cause.  The contest sponsors (of which I’m one) will collectively donate $25 to the National Consumer Law Center for each song submitted.

Most of all, it should be fun to see all the different songs and topics that come out of this.  So get out your pen and paper and start writing the bankruptcy songs that Burt Bacharach and Bob Dylan never wrote.

Russell A. DeMott is a Charleston, South Carolina bankruptcy lawyer who helps people file Chapter 7 and Chapter 13 bankruptcy.