As a Consumer Bankruptcy Lawyer who regularly meets with individuals about their financial issues, I always treat the initial interview as if I am applying for a job.  Yes, that is correct.  The Client is actually hiring the bankruptcy lawyer, so why should I treat the initial interview as anything else.  After all, they are hopefully going to hire me.

Before ever getting to the initial interview, the client has to make several decisions.  First, how do they find an attorney.  While many people are referred to a bankruptcy lawyer by friends or relatives, some people are not so lucky.  This is where you have to do your homework.  If you read the bankruptcy law network blog regularly, you know how to find one.  But, for those who spend their time doing other – shall we say less important – things, my colleague Jay Fleishman, made it easy.  

So now, you have an appointment set:  What do you do next?  You prepare for the interview right?

You gather as much information as you can.  Hopefully, the bankruptcy lawyer has forwarded you a client intake sheet, a frequently asked questions page and a little bit more information about themselves.  This is for your mutual benefit.  The bankruptcy attorney wants you to look over the information before you come in.  Bankrupty has it’s own lingo, and sometimes bankruptcy attorneys drift off into a different language.  If so, please stop them and say:  Please come back to earth.  At the same time, you should want to know a little about the firm you are interviewing and the subject about which you will be speaking.

If the attorney has not sent anything to you, you may want to do a little homework on your own, but in my opinion, that is strike one.

Remember, you are seeking to get the most out of this time.  You want to be educated, informed and ready to discuss your finances.  So, it is very important that you, the potential client, can help sort out the details.  You want the attorney to be fully informed, so that he or she can give you the best advice possible.

Upon arriving at the Bankrupty Attorney’s office, you again need to have your antenna’s up.  What is your overall opinion of the office, staff, location, etc.  The Attorney works there on a daily basis, and does not usually have the ability to walk in with a unique perspective.  You do, and you should be looking at the details.  If the office is neat, organized and you are warmly greeted, we are off to a good start.

Once the interview takes place, you should not be interrupted.  The only interruption should be if there is an absolute emergency.  This is your time to spend together, it was scheduled and should not be interrupted.

Once the interview is completed, you will need to make a decision.  Is this the bankruptcy attorney for me?  If yes, great?  If not, keep looking, as there are alot of fish in the sea.

I hope this helps.

Your Bankruptcy Attorney and you are a team, no doubt about it.  So, please choose your bankruptcy attorney wisely because you are going to be spending quite a bit of time with him or her and their staff.  Since the new bankruptcy law took effect in October 2005, the amount of paperwork in bankruptcy has quadrupled and the time spent planning, preparing and signing the documents  involved has increased dramatically.

So, the best advice I can give to you prior to the new year celebration is to take the time necessary to get to know your bankruptcy attorney well, and you may even ask to meet with members of their staff so that you know who you are dealing with.

When I say choose wisely, you must remember that you are choosing a bankruptcy attorney based upon their credentials first and foremost.  You need to know that this attorney is competent to handle your legal affairs.  You cannot rely on a slick yellow page advertisement to make your decision.

You need to do your homework first.  Ask your friends about different bankruptcy attorneys.  If you do not want to discuss your financial problems with a friend and prefer looking on the internet, then by all means, jump right to step number 2.  I believe a personal recommendation from a friend is one of the highest endorsements that an attorney can receive.  However, I also understand that many individuals do not discuss their personal financial situation with their friends.

Next comes the meeting with the Attorney.  Please make sure you are prepared for the meeting with the attorney.  Many, if not all, consumer bankruptcy attorneys offer a free initial consultation.  This is your opportunity to find out whether this person is the bankruptcy attorney for you.  I prepare for all of my initial consultations because I am looking at this person and asking myself:  Do I want to work with this person?  Will this person trust me enough to let me guide them through this process?  Will this person be there when I call requesting additional documentation?  Will this person be nice to me and my staff?  Will this person see this case through to the end?

Ask yourself:  Did they really listen to me?  Did they answer my questions?  Will they take my calls?  Will they return my calls?  Will they handle my case or will I be outsourced?  ( This is a tough call for many individuals because they do not understand the nature of how a consumer bankruptcy practice works.)  Please understand that your attorney will not be working on this file alone.  He or she should have an Administrative Assistant or a Paralegal or both.

Assistants and Paralegals serve a very important role in the Attorney Client Relationship, and therefore, it is important for you to understand this role from the beginning so that you never feel like you are being thrown around from person to person.

The words Mortgage Modification and/or Mediation and Bankruptcy were never used in the same sentence because we all know that a debtor in Chapter 13 bankruptcy cannot use the Bankruptcy Code to modify a primary mortgage on their residence.  However, in the wake of this economic challenge, the winds of change are blowing, and we are starting to see cracks in the old walls.  Now, Bankruptcy Judges are creating the changes they wish to see.

In Orlando, Florida, the Bankruptcy Judges, Chapter 13 Trustee, Debtors Attorneys and Creditors Attorneys started a mediation program to assist debtors who wanted to save their homes.  Under the current Bankruptcy Code and existing case law, this may be impossible under certain circumstances, however, there is nothing in the Bankruptcy Code or existing case law which prohibits the parties from a mutually agreed modification of the mortgage.  So far, the program has seen a great deal of success.

Mediation is an alternative dispute resolution process where the parties come together in a totally open atmosphere.  There is confidentiality without fear of reprisal.  The parties meet across a conference table and each side gets to present his or her version of the issues and possible solutions under the guise of an experienced mediator.  The mediator is a neutral third party who is there to help the parties come to a mutual agreement.  The mediator is not there to assist the parties in the presentation of their arguments.

The best part of mediation for the debtor is that a mediation may present the one and only time that a debtor can express himself and the problems that they have been having open and honestly without fear that their words will hurt them to a person who is a decision maker from the mortgage company.  I know that many individuals who are behind on their mortgages express their anxiety and stress about having to deal with the mortgage company and never speaking to the same person, or that the person who they are speaking with was not a decision maker.  Mediation provides the debtor with a forum for clarifying the issues and really laying out a plan for a modification concurrent with their existing Chapter 13 Plan.

The program is now spreading to the other three divisions of the Bankruptcy Court in the Middle District of Florida (Tampa, Jacksonville, and Fort Myers).  Of course, each Bankruptcy division will have its own uniqueness about it, but the overall goal of each program is allowing a debtor to mediate his or her mortgage claim while still maintaining the protections of the Bankruptcy Court.

By using the program designed by the Bankruptcy Court, the benefits will receive outweigh any detriments in my opinion.  A debtor who chooses this path will have the opportunity to demonstrate to the mortgage company why keeping their home in a Chapter 13 bankruptcy is not only reasonable but financially a good decision.  Likewise a creditor shall have the opportunity to see the debt0r’s financial position and why the creditor will be paid first before any other unsecured creditors.

I believe it is a win – win for the debtors and creditors.

In Re Vandenbosch answers the question of whether a Chapter 13 Debtor must include their social security benefits in the determination of monthly income in Southwest Florida.  In the past, debtors were required to use their social security to repay creditors claims in their bankruptcy plans.  This was a very unfair practice in my opinion, and therefore, The Dellutri Law Group decided the issue needed to be heard by an appellate court.

In a very recent opinion, Judge Steele of the U.S. District Court in Fort Myers, Florida overruled the Bankruptcy Court decision to include Social Security Benefits into Disposable Monthly Income.  In the case of In Re Vandenbosch, one of the issues on appeal was whether a debtor who receives social security benefits must include those benefits as part of their income in the determination of available monthly income.  Judge Steele ruled that a Chapter 13 debtor does not have to include their social security benefits in the calculation of monthly income.Disposable monthly income is determined by looking at a Chapter 13 debtor(s) income from all sources and then subtracting all of their ordinary and necessary expenses.  The money leftover is the debtor’s disposable monthly income.  In a Chapter 13, the debtor or debtors must turnover all of their income to the Chapter 13 Trustee for distribution to the unsecured creditors.

When the debtor’s disposable monthly income included social security benefits, this put the bankruptcy code at odds with the social security statute.  The social security statute clearly states that benefits are exempt from creditor’s claims.  Logically, it seems that these exact same benefits should not be used to pay the claims of creditors during a bankruptcy proceeding.

In a prior post on Bankruptcy Law Network, Attorney Wendell Sherk, noted the exact same issue before the 8th Circuit Bankruptcy Appellate Panel.  The 8th Circuit came out with the same conclusion, that social security should be excluded from disposable income; however, the Court there did not look at the bad faith issue.  Judge Steele found no bad faith in the Vandenbosch decision.

Why and How Bankruptcy Courts came to the determination that social security benefits should be included in disposable income was shocking to me.  Now that the issue has been decided by Judge Steele many other people, senior citizens on social security included, should be looking at the benefits of Chapter 13 bankruptcy.

Without having to include their social security benefits into the determination of disposable income, a person or couple who receive social security benefits repayment plan could look much different now than they did a couple of months ago.

As a Consumer Bankruptcy Attorney, I really enjoy explaining the benefits of Chapter 7 Bankruptcy and Chapter 13 Bankruptcy to a potential client.  Bankruptcy is a financial planning tool, plain and simple, kind of like a Swiss Army Knife.  Inside this one tool, you have many different options.

I enjoy watching their faces light up when they begin to realize the possibilities that they never knew existed.  It’s as if the proverbial “light bulb” goes on inside their heads and they begin to see the future as opposed to their current reality which one client compared to a hamster running on a wheel day in and day out.Well, recently, one of our tools was clearly eliminated for the time being, Chapter 20.  One of the Southern District of Florida Bankruptcy Judges, the Honorable John K. Olsen, issued a consolidated opinion (September 19, 2011) of In Re: Quiros.  In the opinion, Judge Olsen lays out a very strong case as to the reasons why this procedure should not be pursued by debtors.  He reviews the cases on both sides of the issue and draws very logical conclusions.

What is a Chapter 20 you say?  Well, I’m glad that you asked.  Chapter 20 is a Chapter 7 Bankruptcy followed by a Chapter 13 bankruptcy.   I know you may be asking yourself why would anyone want to file two bankruptcy cases?  Well, there are reasons for everything and sometimes it is beneficial to an individual to file two cases even if they would be ineligible for a discharge in the subsequent Chapter 13.

Under the 2005 amendments to the Bankruptcy Code (BAPCPA), a debtor can file a Chapter 13, after receiving a Chapter 7 discharge, and have the Chapter 13 plan confirmed, despite being ineligible for a discharge, provided that the Chapter 13 plan meets all the requirements for confirmation.

Chapter 20 cases under BAPCPA raise numerous legal issues and Courts around the Country are grappling with this very issue and coming out on both sides of the issue.  Recently, my colleague and friend, Craig Andresen, a Minnesota Bankruptcy Attorney wrote about the In Re Fisette decision out of the Eighth Circuit Court of Appeals.  Interestingly, the Eighth Circuit Court of Appeals ruled that a lien strip can occur in a Chapter 20 case, even where the debtor was ineligible for a discharge.  The Fisette Case is the first ruling on the Chapter 20 lien strip issue from a Federal Appeals Court.  The Opinion (issued August 29, 2011) was very well reasoned and written by the Honorable Barry S. Schermer, and his opinion draws the exact opposite conclusion.

In the 11th Circuit Court of Appeals, we have a very interesting situation.  Now that the Southern District of Florida has ruled that there cannot be a lien strip of the second mortgage in a Chapter 20 and the Northern District of Georgia has ruled that this can be done, we will have to wait to figure out what the 11th Circuit will say when and if the case gets up to the Appellate Level.

The amazing part of this whole story is that Judge Schermer is now a sitting Bankruptcy Judge in the Middle District of Fort Myers.  Yes, this does get interesting doesn’t it.  This is the same Judge Schermer who issued the Fisette opinion.  So, the $1,000,000.00 question is:  How will Judge Schermer rule on the issue when it presents itself in the Fort Myers Divsion of the Middle District of Florida.  I don’t know, but I can tell you that from the few time that I have appeared in front of Judge Schermer, I can tell you that he doesn’t make rash decisions.  He is very prepared and expects attorneys to do the same.  If he rules along the same lines as Fisette, it will be understandable.  If he decides that Chapter 20 lien strips will not fly in Florida, I can guarantee you that his opinion and reasoning will be crystal clear.

I hope that I get the opportunity to bring this issue before Judge Schermer.  However, this position doesn’t come without risk.

So, what is a Debtor to do in the Middle District of Florida.  Well your choices are limited unless you have the funds and the right set of facts to take this case all the way up to the 11th Circuit Court of Appeals.  You must work with your attorney to decide what the best course of action will be for your individual circumstances.    First, you can file a Chapter 13 from the beginning and attempt to strip the wholly unsecured second and/or third mortgage.

Second, you could file a Chapter 7 first and surrender the home back to the mortgage creditors and see if they are willing to negotiate with you after your discharge.  This is not guaranteed and this option comes with the risk of foreclosure so this option needs to be fully explored between you and your attorney.

Third, you could attempt to settle the second mortgage before filing for Chapter 7.  In other words, you can offer the second mortgage $1,000 to settle it’s lien.  It can’t hurt to ask, and if they say no, let them know that you will be filing bankruptcy and you will be surrendering the home.

Lastly, you could file the Chapter 7 and receive your discharge.  Then you can roll the dice and file the Chapter 13.  If the Judge follows the Southern District of Florida ruling and denies your plan and rules that there will be no lien strips in a Chapter 20, then you have reason to appeal based upon Fisette.  This could be an expensive proposition and should be careful.

Think about this:  What if you file the Chapter 7 and recieve a discharge.  Then you file the Chapter 13 and attempt to strip the second mortgage and your case is assigned to Judge Schermer.  Whoa.  Talk about a career decision.  What do you do?

The Bankruptcy Law Network was created to furnish timely analysis of bankruptcy procedure, bankruptcy case law and bankruptcy tips of the trade for the seasoned and newbie bankruptcy practitioner. When we started the BLN, we were a bunch of hungry bankruptcy attorneys who were on a mission to spread great information to everyone and anyone who would listen.  We weren’t asking for anything in response, just an audience.  Over the years, our audience has grown and grown, and for that we say Thank You.  Thanks for listening.

One of the areas where we could all use a little bit of help is in the area of letting go.  I have been practicing consumer bankruptcy law for over 15 years, and I don’t recall ever taking one vacation during that time where I didn’t call into the office, check email or return a call to a client in crisis.

When I check my email, I am constantly being bombarded by emails from NACBA, NACA and local listserves telling me about this or that or the latest case from Utah and what it means for my practice.  If I could keep up with all the information, I would be Superman.  So, what do I do to stay up with all the information that I may be missing, I go to a Bankruptcy Seminar for NACBA, and I meet up with some of the people who I consider to be the supermen of bankruptcy law.  During the seminar, I usually check email, send some new ideas to the other attorneys in the office, or maybe I come up with a good marketing idea that I pass onto the office.  I leave the seminar all charged up, and I go home with a renewed energy.  Or Did I?

What I didn’t do was let go.  I didn’t take the real time necessary to stop and take a break from the stress of the job.  As a bankruptcy attorney, we all know that this job is stressful and frustrating at times.  We all know that stress kills people, and no where in the world is that more true than in the United States.  Knowing all of this, you would thing that my fellow bankruptcy attorneys would spend more time at the gym, eat better and really focus on spending time away from the office.  In other words, unplug.

At times, I don’t think my fellow BLNers know how to unplug.  As a matter of fact, I don’t think there are many NACBA members that can truly unplug for a day, nevermind a week.

So, I want to use this time to throw down a challenge for each and every bankruptcy attorney out there.  I want you to challenge yourself to truly unplug for 15 minutes a day.  It’s OK.  Shut the door and demand from your staff that there will be no introductions.  Your clients will not leave you.  Your office will not explode.  Your secretary won’t quit.  I want you to think about where you are in your life.  Is it where you want to be?  Is it where you want your practice to be?  What would you change right now if you could?  Ask yourself the tough questions for the first 5 minutes.

Then spend the next ten minutes brainstorming the answers to your question.  Write them down and choose your best 4 answers.  These will be your 4 things to think about for the next 4 days.  What can you do with this information?  Is there anything that you can implement in your practice?  I will bet that this will become the most important 15 minutes in your day.

On your next vacation try letting go completely for a week.  Or, if you can’t truly let go for a week, and you must check in regularly, try doing it once a day between 8 and 8:15 in the morning.  In other words, set a specific time or times that you will call in, and stick to it.  This will train your staff, your clients and allow you to unplug.

Just take some time to think about it.

As I write this blog, there is still no deal on the Debt Ceiling.  Quite frankly, I was trying to understand exactly how our Government’s accounting system works, and I will say that I am absolutely unable to understand how running a deficit each year is a good thing.  There must be a secret training course taken by each and every Representative and Senator which explains how our Federal Government can spend more money than it takes in each and every month.

I don’t know how they do it.  Our President seems to have no problem with spending more money than the Government takes in, so he obviously took the secret course.  It seems that in Washington, DC, this behavior is is not only ok, but it is expected, because none of these men or women plan on paying the bill.  More importantly, Equifax, Experian and Trans Union are not keeping tabs on the Country’s credit report.

Shockingly, the people we send to Washington to represent our interests cannot seem to play nice long enough to put together a deal on the Nation’s debt problems.  However, when these same individuals were contemplating the Bankruptcy Bill  in 2005, there was no doubt that Congress wanted Consumers to complete an approved credit counseling course before filing for bankruptcy.  I guess the secret course didn’t include a session on paying the debt back.

As a consumer bankruptcy attorney, I get to explain to each and every person that I see that they must complete not only a credit counseling course, but also a financial management course.  Here is where I usually get some groans from my clients, but I tell them to embrace the opportunity to expand their financial education.  This as a start on the road to a new education.  I am not a Certified Financial Planner, nor do I pretend to be one, but I do know enough about finances and accounting to be dangerous.

I recommend that all my clients continue their financial education after they complete their bankruptcy and receive their discharge.  I firmly believe that bankruptcy is financial planning for the future.  Each and everyone of us needs a plan for retirement.

Unfortunately, none of us has the same power as the Federal Government to continue to raise our own debt ceilings.  So, I would recommend getting your financial house in order now, so that we don’t have to rely on the Feds in the future.

Before I begin my rant on Chapter 13 and the way I see things turning against some debtors ( not all debtors), I would like to start by saying that I honestly believe that Consumer Bankruptcy is Financial Planning for the Future.  Also, I still believe in the concepts of a “Fresh Start” and the “Honest but Unfortunate Debtor“.  These are concepts that I learned about a long time ago, concepts that I embraced and believed in and concepts that I still embrace and believe in today.  However, at times my beliefs are tested.  I don’t believe that the bankruptcy system was designed to be oppressive, but it is turning out that way for some individuals.  Likewise, I don’t think the Bankruptcy Code was designed to take away a person’s incentives to work hard and create wealth, but it is turning out that way for some individuals.  I do believe that the bankruptcy code should be designed to instill in all debtors the opportunity to put the past behind them and move forward as positive and productive members of society.

Back in 2005, Congress sent President Bush an alleged Consumer Protection Bill (BAPCPA), and he signed it.  Since that time, Debtor’s in Chapter 13 have had to deal with new rules on how they file their case, how they can spend their money and most importantly, how they plan for the future.  Remember back in 2005, the real estate market was going like gang-busters and individuals were investing in real estate as part of their retirement planning.  Unfortunately, we are now seeing how a great real estate deal at the time is causing many individuals into bankruptcy.  Of course, I am talking about a small minority of individuals using Chapter 13 to re-organize.  More importantly, these honest debtors have witnessed their “Great Deal” turn sour into the “Worst Deal” of their lives and also watched their IRAs and 401Ks take a hit are now finding themselves “trapped” into a system where they will spend the next three to five years of their lives paying back a creditor or creditors.

Of course, there are two sides to this story.

THE GOOD SIDE

Yes, bankruptcy offers a solution to pressing legal problems that many debtors are facing.  Yes bankruptcy still offers individuals a chance to re-group and pay their creditors as they can afford to.  Without bankruptcy, many idividuals would be at the mercy of their creditors for years and years.  Many individuals paychecks and bank accounts would be garnished.  In Florida, there are quite a few ways that creditors can collect on their judgments.

But, at the same time there is still that little voice in the back of my head saying my clients are being forced to pay back their debts over the next five years, but what happened to the bank presidents, wall street executives and mortgage companies that were a little careless?   No-one has gone to jail in this whole recession – banking debacle.  Some of the banks were bailed out.  Many of the banks who were lending recklessly are now out of business.  Yet, no-one has gone to jail, and no-one is being forced to pay back any monies for their reckless behavior.  That is outrageous in my opinion.

THE BAD SIDE

Chapter 13 has been turned into a system where each and every penny that the debtors earn will be scrutinized, and if the debtors have any additional disposable monthly income during the life of the plan, it must go to the creditors.  Chapter 13 does not reward hard work or encourage anyone to attempt to earn more money.  Why would you work overtime knowing that you will have to give it to your creditors.

Yes, that is what I said.  Rather than give these honest but unfortunate individuals an opportunity to rebuild their nest eggs that were decimated during the “Recession”, we are compelling them to indentured servitude for 3 to 5 years.  I would consider that punishment in some circumstances.  If you are an above-median income debtor on the day you file for protection, you are compelled to file a 5 year plan of repayment (Now known as a 5 year sentence).  The only way you can get out early is to pay 100% to your unsecured creditors.  This does not sound like consumer protection to me at all.  This sounds like punishment that is being inflicted upon individuals by their creditors under an alleged Consumer Protection Statute.

When I asked our local U.S. Trustee where the incentive is for chapter 13 debtors to work harder or work overtime, he could not think of one advantage.  Just imagine that you have a pretty secure job and you are a good, loyal and trustworthy employee.  Your boss comes to you and says Hey, I want to give you a promotion, you will make more money, etc.   How many people are going to want to take it?  Would you be willing to spend more time away from your family to earn more money for your creditors?  I wouldn’t.

So the question is:  Did the 2005 BAPCPA amendments to the Bankruptcy Code really prevent abuse and protect consumers?  Or, in the alternative, did it create a Debtor’s Prison for some Honest But Unfortunate individuals?  Or, maybe a little bit of both.

One burning question in my mind is this:  If Walt Disney had filed for bankruptcy protection under BAPCPA, would we have Disneyland and Disneyworld?  I don’t think so, and that scares me because I don’t want to even consider that possibility.

I can go on and on, but I really needed to get this off my chest.

Yesterday, my clients and I were meeting to sign their Chapter 13 Bankruptcy Documents for filing, when the client pulled out his just received in the mail Pre-Approved Credit Card Letter.

Dear Mr. _______:

“Your good standing has been found creditworthy by _______ Visa and that qualifies you for a new Visa credit card.”

My first thought was:  Are you kidding me?  Believe me, I could write an entire blog on the wonderful benefits of this piece of plastic.  Note the sarcasm.

I recently posted a video about which secured credit card would be the best to acquire after a person files for bankruptcy.  The reasoning behind this video was simple.  I wanted consumers to know that after they file for bankruptcy the secured credit card solicitations will begin to come fast and furious.  Now, it seems like the credit card solicitation has been taken to an entirely new level.

The reason I say this is because my clients were not in the best financial shape.  They were re-organizing their finances for this very reason.

I understand the credit card game.  It is a revolving door.  People sign up for a card and eventually close the card.  Sometimes people last for a while, but the credit card companies must continually grow or die.  They cannot sit around servicing their existing accounts.  They must pursue new business.

I also know that the credit card company did not know that the clients were contemplating filing for bankruptcy; however, they did target these individuals for an application. Knowing a little about marketing, I thought about this for a moment and asked my clients if they did anything which would trigger this application.  Did they buy a new car?  Did they apply for credit?  In other words, I wanted to know if something kick-started this whole process or if it was just a random occurrence.  It seemed to be random.

This really got me thinking because something in their credit file must have said:  These people or person fit the exact criteria and/or demographic that you MR. VISA card are looking for.  As we all know, the credit card companies rely on the big three Credit Reporting Agencies for their information.  So, once Mr. Visa sets the parameters, the CRAs scour their credit profiles looking for those individuals that fit the criteria.  Once culled, those lucky individuals begin to receive the onslaught of unsolicited mail.

Lucky them.

How can you opt out of being one of the lucky people.

Before we get there, let’s just say that pre-approved doesn’t always mean what you think it says.  No, these are not the best cards on the market.  But, they do serve a purpose for some individuals.  Like everything else, before applying for one of these little devils, please do your homework, watch video blogs from consumer advocates and read the fine print.

Ok, so let’s talk about opting out of the promotional marketing.  Here is all you need to do.  Call 1-888-567-8688 and provide some information into the automated system.  Once completed, you will be protecting yourself for two (2) years.  You can also request information to make this a permanent feature.

If you are like me and need to proof read the copies as well as the original, you can also contact each CRA.  Equifax is 1-800-556-4711;  Experian is 1-800-353-0809;  Trans Union is 1-800-680-7293.  Supposedly, it is not necessary to contact all three CRAs, but I tend not to trust these companies to do the right thing.  So, in an abundance of caution, call them all.

I hope this helps.

Good Luck

If I have said it once, I have said it a thousand times, bankruptcy is purely financial planning for the future.  If you use bankruptcy strategically, you will maximize the benefits of resolving many if not all of your financial issues.  However, bankruptcy is not a cure-all which solves all of your financial issues.

What is post-bankruptcy planning?  Good Question.  Before we get there, let’s put this topic into perspective.  Before filing for bankruptcy protection, an individual may do some bankruptcy planning.  They may get their financial house in order and gather up the latest statements for their attorney, etc.  This is where I see the case.  I also see that many individuals have no financial goals for themselves, and even worse, husbands and wives do not have a joint plan.  This is where post-bankruptcy planning comes into play.

Once the bankruptcy case is over, I am usually out of the picture.  What I want to see is that my former clients now have a plan for the future.  I want them to pay off their homes, cars and student loan debts as quickly as possible.  Then, I want them to start saving for retirement.  

I don’t care if they are in their 30s,  40s or 70s.  I want them to have a plan.  This idea needs to be planted early on, and it needs to be followed through on.  When was the last time you and your spouse answered these questions:  When do we want to retire?  How much money will we need?  and What kind of lifestyle will we want to lead?

My fear is that most people do not do this in their lives.  I can tell you from experience that most people do not know what kind of retirement plan their spouse has.  Or, if they do know it’s a 401K, they cannot tell you what type of investments are held or how much is in the account.  Likewise, they do not have a common goal.  I can tell you from personal experience, that inquiring into your significant others finances is a daunting process that one must take lightly.  But, if explained properly, it makes perfect sense.

I can understand the financial gurus who say that you should put your financial plans on auto-pilot by paying yourself first, yada yada yada, and I think that is fine.  What I don’t think is fine is the failure to get on the same page with your spouse or significant other especially after the last few years with high unemployment and dismal home prices.  Ask yourself:  What happens to us if…………..?

Think about it.  If you ask your husband or wife:  What age do you want to retire?  and What kind of lifestyle do you want to lead?  You may be shocked at the answer that you receive, I certainly was.  Or, will you have asked this question 10, 20 or 30 years before retirement and in enough time to meet those joint goals.

I started with a wish list of what I want my retirement to be.  Then I started asking myself where I wanted to live.  Once I had a pretty good idea of what I wanted my golden years to look like, I asked my wife the same questions.  I was absolutely shocked by her responses.   She didn’t want to spend all of her time fishing.  She didn’t think my plan was a good plan at all.  As a matter of fact, she laughed at me and told me that we might as well spend our retirements separately because there was no way this was going to work.  At that point in time, we learned a new word.  Compromise.

There is always time to set and meet your goals.  But, it will require you to turn off the television and talk to your significant other.