What do I do after bankruptcy?

After your bankruptcy is over you can certainly begin enjoying your new life with your debts discharged and you don’t really have much that you need to do.  Your debts are now in the past and your future should be debt free.  There are just a few things that you can attend to:

1) Re-establish credit–  You will want to begin re-establishing credit right away after your bankruptcy.  There is no need to wait and you can certainly begin immediately.  You will want to get new sources of credit.  Loans, either secured or unsecured, that will appear on your credit report are a good way to begin to re-build your credit.  You can buy a car or furniture or anything that you pay off monthly and if you make your payments on time you will get positive points on your credit score.

You can and should also get 3 new credit cards after your discharge.  You should get solicitations from credit card companies right away after your bankruptcy is completed.   You can use these new cards to re-establish credit.  If you do not get solicitations then visit your credit union or bank where you have a deposit account.  They will probably give you credit there.

You can always apply for secured cards too.  These are cards where you give the creditor money and the creditor gives you credit based upon how much money you deposited with them.  These secured cards will report on you credit report just like regular cards so make your payments on time.  Remember also to keep your balances low.

 2) Check your credit report-  You will want to check your credit report after your discharge to see if all of your debts are properly reported as “discharged in bankruptcy”.   Challenge any debt not properly listed.  You can get your credit report for free at www.annualcreditreport.com.

 3) Stay out of debt- Be sure to be careful to stay out of debt.  You do not want to fall back into debt after your bankruptcy is over.  This is a good time to develop new habits with credit.  Use your cards to improve your score but pay the balances each month.  It is a good time to live debt free.  Remember too that you cannot file bankruptcy again for 8 years and you don’t want a second bankruptcy unless it is necessary due to some calamity.

 4) Move on with your life- You can now move on and get a new job or buy and sell property or travel and do anything you wish after your discharge.  You are required to report any large amounts of money you receive after your discharge but only for 6 months.  After that you can do anything you want and you are free of the system (as long as there was no fraud involved in your original bankruptcy).

5) Enjoy your new-found freedom Rmember that you are debt free.  Enjoy your new life!

I am bankruptcy attorney in San Diego.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics or call me for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com

Can I still go to debtor’s prison if I owe money? Look out Charles Dickens, in some states unfortunately it appears that it is happening now!

(My most recent debtors prison blog is found here: http://bit.ly/I2qMO2 .

There are numerous articles posted online that describe cases where people appear to have been put in jail in some states for merely owing  monetary debts.  This can happen to debtors who either owe money to the court or to private parties.  And this has happened in spite of the fact that debtor’s prisons were outlawed federally in 1833.  Most of the states followed suit after 1833 and included clauses in their constitutions prohibiting imprisonment for owing money to someone.

In spite of these prohibitions debtor’s prisons seem to be making a comeback.  There are states where it’s possible to put someone in jail for failure to pay a debt.  I am surprised that lawyers in these states have not put together constitutional challenges to someone who was thrown in jail for such a monetary debt.

According to blog I found online people are languishing in Illinois jails, in Champagne and other counties, for owing unpaid traffic tickets.  A law professor from Notre Dame Law School quoted in the article says that we do have “de-facto” debtor’s prisons because of this practice of jailing debtor’s for merely owing money in spite of constitutional prohibitions even if the money is owed to the state.   According to this law professor this creates a situation where debtors are scrambling to come up with money by any means just to stay out of jail.

An article in the Saint Petersburg Times points out that it costs the jails $53 per day (in Florida) to incarcerate these people who often don’t owe much money.  So the taxpayers pay for the jailing, the judge, and the whole judicial system that wastes time and money trying to collect from these destitute people.  In Florida they have an ominous sounding “Collections Court” that handles these cases and about a third of Florida counties have these courts.  Even in the counties without these courts people are still being jailed for owing money.

According to the Times article it costs the system $62,085 to bring in $80,450 in debt.  Those languishing in jail for these unpaid tickets are certainly poor and often minority but anyone without means can get caught up in this travesty of justice.  How is it still a possibility that you could go to jail for owing money?  Were debtors prisons not outlawed in the 1800s?  Didn’t Charles Dickens inform us 200 years ago about the foolishness of this practice?

The Times article points out that you can be jailed for violating a court order or for failing to make court ordered payments.  So technically they are not being jailed for owing money but it amounts to the same thing.  Jail time is usually given to people who owe spousal and child support but legal experts argue that it is all illegal.

Now there is more and more disturbing chatter on the internet about debtors being jailed for owing a purely private company money.  There are horror stories emerging about arrests made and persons jailed for owing money to private parties.  On such woman was arrested one day, handcuffed, put in a very cold police car, brought to jail and no one told her why for some time while the contents of her purse were unceremoniously dumped in a plastic bag.  She spent a cold night in jail keeping her hands under her armpits for warmth until 16 hours later when she was informed that she missed a court hearing concerning some private debt.

In that case she had missed a court hearing but in Indiana a man faced jail for just failing to pay a purely private debt.  His incarceration had nothing to do with violating a court order.   According to an online article in the Minnesota StarTibune a lawyer challenged the constitutionality of a debtor being threatened with jail for owing a debt.  The appellate judges agreed with the lawyer and he won the case because debtor’s prisons were made illegal in Indiana in the 1850s.

The article in the Star Tribune points out that there is an inconsistency with who is locked up when, and for how much debt, and that all of these things vary from state to state and county to county.  It also makes mention that no one knows how often this happens as no statistics are kept of these incidents.  One man in Illinois was locked up by a judge “indefinitely” for owing $300 to a lumber yard.

Now it seems that the collection agents are influencing the legal system more and more to be more creditor friendly.   Some would say that the collectors are subverting the legal system and using the threat of jail and jail time extract money from people who cannot afford to pay anything towards these privately held debts.

The good news is though that bankruptcy can remove most debts from your balance sheet.  After a bankruptcy discharge you legally no longer owe the debts anymore so no creditor can try to collect on them or try to get you put in jail if you don’t.  Your legal obligation to pay these debts is eliminated.  With debt collectors gaining in power and money and influence this is a very good thing.

In California I know that the courts can threaten jail if you do not attend the court ordered “debtor’s exam”.  This is where a creditor can ask you all sorts of personal questions about your assets and your financial situation.  The courts cannot jail you if you do not pay the creditor in California but they threaten to jail you if you don’t show up for the court ordered exam.

I filed a case for a client the day before his debtor’s exam and he brought his bankruptcy case number to the debtor’s exam.  The other attorney did not know what to do but the judge threw the whole case out right there and told her to go to bankruptcy court for any money.  My client had nothing and the creditor had no reason to declare his debts non-dischargeable so that is the last we ever saw of the creditor.  My client got his discharge without a problem.  Bankruptcy is indeed a powerful mechanism to defeat over-zealous creditors.

You almost always don’t have to argue whether you owe a debt after bankruptcy and you don’t have to argue whether any punishment is constitutional.  I wrote another blog about debtor’s prisons here: http://bit.ly/JmsMFt .

I am a bankruptcy lawyer practicing bankruptcy law in San Diego California.   For more information related to debt, bankruptcy, or debtor’s prison please visit my websites at www.farquharlaw.com and www.freshstartsandiego.com.  Or call me directly for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!  For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

What does it mean when a debt is listed on my credit report as “charged off”?

I often get an inquiry from my clients who have a debt listed as “charged off” on the credit report.  My clients sometimes falsely believe that this designation means that they no longer owe the debt.  It certainly sounds like this could be the case but how often are things that easy in life?  If people could get debts charged off by just waiting then no one would ever pay them.

If a debt is reported on your credit report as charged off you do indeed still owe it.  What a charge off means on a credit report is that the creditor has determined that the debt is bad debt for them and therefore the creditor has sold the debt to a collection agency.  The original creditor then takes a tax deduction for the loss incurred on the charged off debt.  This means that your credit card company actually saves money on its taxes when you don’t pay your debt.

The collection agency which buys the debt then begins to add additional charges to it.  The debt takes on a new life and grows so this new debt collection company can make more money to collect it from you.  These debts though are transferred/sold to these collection agencies with the full rights to collect the full amount.  No lessening or forgiveness of debt occurs during this process and in fact just the opposite happens.  The debt continues to get bigger after the sale.  It does not matter if the debt buyer pays pennies on the dollar.  The collection company will still come after the debtor for the full amount.

These collection agencies are a very big business and they are very profitable.  They buy and sell these debts in lots numbering in the thousands.  Sometimes they just trade them.  If the collector sues you they will add court costs, attorney fees, and interest to boost it up even further.  It is not unusual to have a client come to me with a debt that has tripled over the years.

The good news is that bankruptcy ends the debt merry-go-round and the debt inflation.  It all ends when you pull the trigger and file a bankruptcy.  The debt, the collector, the lawsuit, and all of their various fees and charges just melt away.  You don’t have to argue about how much or whether you owe it and you don’t have to worry about a debtors exam or other techniques to get you into court to collect from you.

The collectors are skilled at collecting.  They are like the terminator and that is all they do.  They don’t care if you are sick, unemployed, pregnant, destitute, or if you have 10 mouths to feed.  They want their money and they want it now.  They get paid by collecting from you and they are trained not to listen to your sob stories.   They will hound you virtually forever unless you pay them or die or file for bankruptcy.

All this ends with a bankruptcy so contact a bankruptcy lawyer today to see if bankruptcy is an option for you.  If you have debts charged off or otherwise owed by you that you cannot pay then check into a bankruptcy to see it is right for you.  A bankruptcy attorney can answer your questions and should not charge for the initial consultation.

I am bankruptcy attorney in San Diego offering free consultations.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics or call me for a free consultation at (619) 702-5015.  Call now for a free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com

What is a fraudulent transfer? Did I do something wrong?

I know that fraud sounds bad and fraudulent transfer sounds even worse.  But his term is often used in and out of bankruptcy.  (Sometimes it is referred to as a fraudulent conveyance).  In your bankruptcy you may have gotten a notice that you are being accused of a fraudulent transfer by the bankruptcy trustee.  Fraudulent transfer rules come from section 548 of the bankruptcy code.  But don’t worry, this can be addressed in the bankruptcy and it does not mean that you are guilty of any crime or even that you are a bad person.

This is because they are not (usually) talking about you committing an actual, intentional fraud where you decided to de-fraud someone of their money or property.  They are instead talking about a “constructive fraud” which is one where there is a law against doing these trnasfers but intent to do fraud is not there.  Fraudulent intent is inferred from your actions.

The fraudulent transfer label is used most often when an asset/property has been transferred to someone else under circumstances that look suspicious. This could be real estate or personal property like a car or a piece of jewelry. In the bankruptcy context it occurs when you transfer an asset to someone else, you receive little or nothing in return, and you are insolvent at the time.

You may have had no bad intent at the time you transferred the asset so don’t worry.  You may not even have thought that it was wrong.  I have had clients transfer all kinds of things for many different reasons.  You will need to disclose the transfer to your bankruptcy attorney and describe the circumstances surrounding the transfer any time you have transferred property before a bankruptcy.

And the look back period varies in different states but in California it is four years.  So any property transferred to someone else in the last 4 years for less than its full value needs to be reported in the bankruptcy.  Especially if that transfer leaves you insolvent which means that your liabilities are greater than your assets.  This would not include a property sale to an outside buyer, especially to a buyer who pays full value.  There is a much shorter “look back” period for these transfers and they are usually not questioned by the trustee.

The purpose of the fraudulent transfer rules in bankruptcy is to prevent people from moving assets out of their estate and then going bankrupt on the debts.  Everyone would give their property to family members if they could and then get rid of their debts.  After the case was concluded then they could take the assets back.  This would not be fair to creditors and is not allowed so report these transfers to your attorney in a bankruptcy.

If you received a notification of a fraudulent transfer in a bankruptcy then the trustee could file or possibly has already filed what is called an adversary proceeding.  An adversary proceeding is a complaint filed within a bankruptcy case that is objecting to some aspect of the case.  A trustee will file one if there is a suspected fraudulent transfer of an asset.  He will want to bring this asset back into the estate to sell it for the benefit of the creditors.  (See here for more on adversary proceedings).

The problem here is that the trustee will seek to recover the asset from the person who received it.  If the transferred asset has gone to your relative or friend then they would be drawn into the case so that the trustee could take the asset from that person.  This person, the recipient of the asset, is not going to be too thrilled about this so this is a fairly serious problem.

As with all adversary proceedings this complaint must be answered.  Even if no adversary has been filed you still need to contact an attorney to deal with this issue.  Sometimes a settlement can be worked out but often the proper procedures must be followed timely or a judgment can occur for the entire asset.  If this is a piece of real estate or and expensive piece of jewelry then this can mean a great loss of money if a settlement could have been worked out.

I am bankruptcy attorney in San Diego who handles adversary proceedings for both settlement and trial.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

What the heck is an bankruptcy adversary proceeding? Why would someone bring one against me?

Adversary proceedings happen sometimes in bankruptcy cases.  I write about this because a debtor will sometimes file for bankruptcy and then get a notice of an adversary proceeding that has been filed in the case.  This can cause tremendous worry to the client.  But don’t despair, a good attorney will be prepared to handle one of these cases and protect your rights.

An adversary proceeding is literally a lawsuit within a bankruptcy case.  A case within a case.  It means that someone objecting to or fighting about something in the bankruptcy case.  Somebody is letting you know that they have a problem with some aspect of your bankruptcy and they are going intervene in your case to get their problem/objection dealt with.

An adversary proceeding can be brought by just about anyone.   A debtor, a creditor, or even the bankruptcy trustee who is tasked with looking for things like fraud in a bankruptcy case. Almost anyone can file one if they have a legal claim against the debtor or his property.

An adversary proceeding most often happens when someone is intervening in the bankruptcy case to say that some debt is not dischargeable.  Allegations of fraud are the most common reason to file one of these.  Creditors or the trustee himself can file an adversary to challenge the dischargeability of some debt if fraud is suspected.  These are the cases filed under the “exceptions to discharge” under 11 USC § 523(a)(2) of the bankruptcy code.  In addition to fraud, but less often, misrepresentation, false pretenses or other allegations can be pleaded in these cases.

The fraud cases usually come down when a credit card company files an adversary challenging a large charge made on one of your credit cards prior to filing.  These same companies can also object to a large cash advance taken out on a card especially if the cash advance is taken out at a gambling casino.  (I have had a number of these cases over the years as this is more common than one might suspect).

There can be other larger allegations of fraud that can allege fraud over some asset like real estate.  These cases can reach into the millions.  If you find that an adversary was filed against you for very large debt then it is even more important to contact an attorney right away to protect your rights.  With all of these cases is the other side wins then the debt they are challenging will be deemed not discharged in bankruptcy and you will still owe it when the bankruptcy case is finished.  This tends to defeat the whole point of bankruptcy and therefore these cases must be dealt with quickly and correctly.

If it is the trustee who is trying to recover property for the bankruptcy estate (property that was transferred out of the estate prior to filing) then he would file an adversary action alleging fraudulent transfer.  In that case he would go after the recipient of the property which could be a problem if it is a relative or friend of the debtor.  (See here for more on fraudulent transfer).

Other reasons for adversary proceedings would be when a creditor believes a bankruptcy was filed in bad faith.  A debtor can also file an adversary proceeding against a creditor for violations of the bankruptcy automatic stay when a creditor attempts to collect a debt which he cannot because of the bankruptcy.  There are adversary proceedings filed by the debtor’s attorney to strip off second mortgages.

There are numerous reasons for adversary but contact a bankruptcy attorney right away if you get one filed against you.  There are distinct timelines to respond to one of these and definite procedures for doing so.

I am bankruptcy attorney in San Diego who handles adversary proceedings for both settlement and trial.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Bankruptcy and the Bible. Yes, debt forgiveness is in there!

bible 3You may have heard it quoted.  It is written in the bible in the Old Testament.  I quote it here:  Deuteronomy 15:1-2, “At the end ofDeuteronomy 3 every seven years you shall grant a release.  And this is the manner of the release:  Every creditor shall release what he has lent to his neighbor.  He shall not exact it of his neighbor, his brother, because the Lord’s release has been proclaimed”.  Yes it is in the bible.  A “release” from your debts shall be granted every seven years by your creditors.

This verse therefore commands creditors to release people from the debts owed by debtors every seven years.  You could argue that the bankruptcy just enforces this biblical passage through the use of law.  You could easily argue that bankruptcy is indeed the very debt forgiveness talked about in this biblical passage.  (And I doubt the creditors will follow this biblical principle without bankruptcy law but you can try).

You could ask why is debt forgiveness in the bible.  Most of us in the debt relief business believe that it is in the bible because people knew in ancient times what we should all know now.  Debt is damaging to people, damaging, to society and damaging to the future of mankind.  It can’t be carried by people forever and it can’t be allowed to follow them and put them in debtor’s prison forever.

Debt slavery is extremely undesirable and indeed intolerable.  Debt must be released and people must be freed from it.  Ancient peoples knew that then and most of us who have lived with debt know that now.  And some would say that God commanded a seven-year debt forgiveness through this verse in case people forgot.  But it is clear that the bible sanctions debt release/forgiveness and it appears that it must be done on a regular seven-year basis.  It is hard to argue that this verse could mean anything else but that.

I believe that it is true that this forgiveness is necessary because people who are burdened with debt can’t spend, save, invest in homes or retirement and therefore can’t truly be productive members of society.  Sadly many of them check out and some even commit suicide because of debt.  Many of my clients have told me that they have considered suicide with all their debt prior to their consideration of bankruptcy.  Debt burdens are potentially the ruin of individuals and nations.  (see here for my article on my website on why you should file bankruptcy)

Bankruptcy is not the bad thing that many people believe it to be.  Many believe that it is irresponsible, somehow sleazy, underhanded, and in effect cheating.  Many believe that they must pay back their debts no matter how large they are and no matter how long it takes.

But then what is the purpose of your life?  To be a slave to your debt?  To spend you entire days on earth paying something to someone else that enriches them and impoverishes you?  With interest?  They knew better thousands of years ago.  I often believe that in modern times we make silly mistakes and have ridiculous beliefs that our ancestors would laugh at.

Bankruptcy is a liberator of people.  It frees them from debt and gives them a fresh start.

For all of our modern science and technology we still sometimes forget lessons they learned long ago,  One of them is that debt is bad.  It must have a limit in years.  It must be forgiven periodically.  This is good for everyone so let’s get on with it.

The next time someone disparages your thoughts of bankruptcy mention to them that it has been recommended for a very long time by some very trusted sources.  Enjoy your freedom and God bless!  Check out my blog about bankruptcy and Christianity here.

I am bankruptcy attorney in San Diego.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!  For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Holy bible photo courtesy of Jemimus.  Deuteronomy photo courtesy of Billy Alexander.

Are people leaving the labor force? Is unemployment really rising? The labor force participation rate says yes!

There have been many articles and warnings lately that people are leaving the labor force.  These articles claim there are fewer people working or looking for work each year and that the labor force of employed or employable individuals is shrinking.  This is occurring while the population is still rising.  There is therefore apparently not a lessening of the population but a lessening of people in it that are eager to work.

That begs the question of why this is happening.  Is the population just aging?  Are people retiring earlier or are kids staying at home longer?  Or is it that more and more people just giving up and forgetting about working or looking for work?

And if these people are just leaving the workforce out of disillusionment with the current state of the economy then how are they surviving?  Is government (you and me) paying for them?  Are they living off friends and relatives?  Are they living off the land?  What are these people doing and why and will it continue?

According to a recent online article posted on ZeroHedge the labor force has declined in the month of April by 522,000 people.  That means that there are currently 88,419,000 people who are not in the labor force but who are of an age where you would expect that they would be (over the age of 16).  This represents a new low.

I found a definition of the “labor force participation rate” in the Winston-Salem Journal.  It is a term used by the Department of Labor and it simply means the number of people over the age of 16 working or actively looking for work.  According to this article the labor force participation rate for April 2012 is 70% for men which is the lowest since the government started keeping statistics on this in 1948.  For all Americans it has reached the lowest level since 1981.

Some say that high paid jobs are being replaced by low wage manufacturing and construction jobs.  This could account for the lowest level ever of men working.  Many of my clients have looked for higher wage jobs for years and can’t find anything.  Many of these people have given up trying to find a job out of disillusionment.  They simply won’t take a very low paid job at their age and skill level.

As far as 16 year olds are concerned most don’t currently work even if many of us adults think they should.  Indeed the current “failure to launch syndrome” tells us that 70% of children under the age of 30 still live with their parents.  Women make up more than 60% of college grads and they are entering the workforce in numbers which may contribute to lack of job availability for men.  The overall labor force participation rate peaked in 2000 when women really began “flooding” the workforce according to this article.

But still  it seems in general that more people are continuing to leave the workforce.  Some groups have a higher rate but every group seems to have fewer people working as the numbers for the whole labor force participation is at its lowest rate since 1981.

The problem is that the government only counts unemployed people if they are in the labor force. If they have exited for any reason then they are not counted.  So when you are told that the unemployment rate is declining then remember these figures.  Ask yourself if unemployment really is declining because it seems to me that it is still rising.  It also seems like there is an ongoing mass exodus currently from the labor force.  A mass exodus that is not showing up in unemployment statistics.

You might come to the same conclusion that we are being lied to.  That unemployment is rising, more people are out of work and these people appear to be so disillusioned that they have given up on work altogether.  All the while we are being told that the economy is improving and unemployment is falling.  I say don’t believe it.

I am bankruptcy attorney in San Diego.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis! 

 For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

What is better when I am in debt, a debt settlement company or a bankruptcy attorney?

The answer to this question is easy.  A bankruptcy attorney is better than a debt settlement company and bankruptcy is almost always better than debt settlement if you wish to do it.  If you have debts but you don’t want to file bankruptcy for some reason then debt settlement through an attorney can be a good alternative.

I often settle debts for my clients who don’t wish to do a bankruptcy.  We look at the  client’s situation, evaluate the debts and the amounts owed, and we propose a settlement.  This settlement is forwarded to the creditors and in the settlement proposal we state that everyone must agree of my client will go bankrupt and the creditor will get nothing.

Creditors usually realize that bankruptcy attorneys will file a bankruptcy without a problem and they usually come around and agree to some type of settlement.  It does help though to have money to settle with as getting the creditors to accept payments is tough.  They want to settle the entire account if they are to take a reduced amount.  Remember that the collection agencies have bought this debt for pennies on the dollar so a definite reduced amount is far better than an uncertainty or nothing at all.

Debt settlement companies that say they specialize in settling debts (the ones that you see advertised constantly) are probably not a good option in my opinion.  These companies are very expensive, take a long time, and you get no legal protection.  My clients often pay thousands of dollars to these companies and sometimes they get few or none of their debts settled in the end.  (See my article on my website about debt settlement companies).

Clients come to me after having been sued by one of their creditors that was supposed to be taken care of in the settlements.  The client then often decides to go bankrupt anyway.  When we examine the contract the client signed with the debt settlement company we find that they are indeed paying thousands of dollars to have these people “settle” their debts.  The client then discovers that the settlement companies always put in their contracts that the companies don’t provide any legal protection if a creditor decides to sue.

And the creditors will sue.  These settlement companies work by charging you a large monthly fee which mostly goes to pay them in the beginning.  Then when you get done paying them they start putting money away for the creditors so they can offer them settlements one by one.  There is no assurance that the creditors will accept the settlement and the creditors who are last in line often sue anyway.

That is when we bankruptcy attorneys are called when it is too late to save you the money.  We can file the bankruptcy and get you out of the debts but if you had called us first we would have saved you the thousands you spent on the debt settlement company for nothing.

If you hire an attorney in the first place you would not only save money but by law the creditors would have to call us and not you.  Creditors are unlikely to sue once you engage an attorney because they know they must cease all contact with you by law and if they do file a lawsuit then we bankruptcy attorneys can immediately file your bankruptcy case and stop their lawsuit in its tracks.  The creditors would then lose all their filing fees and attorney fees and the underlying debt.

You can see that the creditors are thus very motivated to settle once a bankruptcy attorney enters the picture.  Call a bankruptcy attorney if you are thinking about settling your debts.  The attorney can file a bankruptcy or get you the best deal on a settlement probably far cheaper than a debt settlement company.

I am a San Diego bankruptcy attorney.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis! 

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

What to look for in a bankruptcy attorney in San Diego

Are you looking for a bankruptcy attorney in San Diego?  There are many things you may want to consider when looking for a San Diego bankruptcy attorney to advise you on your bankruptcy.  (See here for an article on why you shouldn’t go it alone and why you need an attorney).

The first thing is free consultations.  Most attorneys give free consultations but there are some out there that don’t.  I see a lot of chatter out there from bankruptcy attorneys who complain about giving free consultations.

Many of them say that there time is worth something and people should not waste their time. Some will give a free consultation if you sign for the bankruptcy but they will charge you $200 sometimes if you do not sign.  If you are not prepared to pay then it would be a good idea to see if your attorney gives free consultations or not and if they are completely free.

Experience is important too of course.  Many attorneys got in the bankruptcy field when the economy went south as their areas of practice declined too.  They may not have had many cases even at this date.  Make sure your attorney is experienced and has worked on many cases for a number of years.  Make sure the have faced a variety of bankruptcy issues and the attorney is competent to advise you on them.

Part-time attorneys are a problem too.  Some attorneys do bankruptcy on the side along with their other practice areas.  They may also do few cases like the new attorney and they may not know the nuances of bankruptcy law.  (See here for my expanded website article for what to look for when hiring a bankruptcy lawyer).

Get an attorney you can get in touch with.  Many large firms and even many small firms have layers of employees that you must speak to instead of the attorney.  You may have a tough time getting access to your attorney and this is a bad situation for you and your case.  You need regular and consistent access to your attorney if you have a problem or question that arises.

You need an attorney who is personable.  Some attorneys were good in law school and they can relate to books and legal concepts but not you.  You are a person and you need an attorney with people skills as well as a smart attorney.

And don’t forget price.  You don’t want a bargain basement attorney.  If he is not making enough to do your case it is unlikely that he will spend the time necessary to do a good job.  He will probably have so many clients that he cannot spend much time on your case.  If on the other hand he is too expensive then that will strain your budget and be a waste of money.

I recommend you find an attorney who will take payments from you and at the same time accept the creditor calls on your behalf until you can afford to pay him off.

I am a San Diego bankruptcy attorney.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.  Or call my office for a free consultation at (619) 702-5015.  Call now for free credit report and analysis!  For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.

Shiller says housing prices won’t rebound for a generation. Are we headed for a society of permanent tenancy?

In an interview with Reuters Yale economics professor Robert Shiller (creator of the Case/Schiller housing index) has expressed his concern that housing prices may not rebound for a generation.  He says that the combination of high gas prices, a weak labor market, and a general sense of unease among consumers have all combined to keep housing prices low for the foreseeable future.  He apparently added in the interview that he was worried that we would not see a housing rebound in our lifetimes.

If this is true could it mean that our generation is doomed to low housing prices?  Will we really not see increases for the foreseeable future?  What effect will that have on future home sales?  Don’t people buy homes because they are a good investment and because they will increase in price in the future?  Will they now stop?  Won’t this radically affect our whole economy and what about all of the people who work in the real estate industry?

These are just a few of the questions I had when I read this.  I hope this economist is wrong but if he is right then we could see a whole different society in the future.  It could be one where people won’t invest in real estate anymore.  People could merely rent their home or apartment and not buy because they have little hope of getting any appreciation or equity out of their investment.  This could mean the end of the American dream of home ownership.

It is well-known that there are kids who are staying longer and longer at home.  Much longer than they did in previous generations.  These are the “failure to launch kids”.  According to CBS fully 70% of children under 30 still live with their parents. These people will probably not buy homes until much later if at all unlike previous generations when people usually left home at 18 years old.

This factor combined with the recession, the foreclosure crisis, and the failure of housing appreciation is creating a different kind of nation.  One where real estate is not purchased nearly as often.  I believe that there could be a future for America where people don’t invest in real estate.  One where they rent and don’t own ever. One where they are tenants for life.  This will be a different society than the one we know now.  Some realtors I know claim that the whole economy is so dependant on real estate that it cannot climb out of this recession until real estate does.  (See here for my blog on how foreclosures are predicted to increase in the near future).

I hope the realtors are wrong and I hope Schiller is wrong.  I personally don’t want to see our country abandon the American dream of homeownership and trade it or a society of permanent, lifetime tenants.  It sounds too much like medieval Europe to me.  I don’t foresee good coming out of us becoming tenant/peasants who have not hope of owning homes.  I believe housing prices must rise again in the not too distant future if we are to avoid an unraveling of society and a return to a more slavish tenant existence.  This would not be good for anyone and a departure from everything were moving towards up until this point in our history.

I am a San Diego bankruptcy attorney.  Please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com for more info. about any of these topics.   Or call my office for a free consultation at (619) 702-5015.  Call now for a free credit report and analysis!

For a free e-book: “13 THINGS YOU SHOULD DO TO PREPARE FOR YOUR BANKRUPTCY FILING” please send a request by e-mail to: farquharesq@yahoo.com.