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"The Creditor Trap"
The banks and the credit card companies have been "trapping" the American public for years. They sometimes charge up to 27.99% interest, which requires approximately 35 years or more to pay off if you are only making the minimum payments. This does not give consumers a realistic view of how much interest they are paying or how in debt they are. Furthermore, after you have established a decent credit card history, they up the credit limit saying, "Congratulations" now you can charge more money. You go ahead and spend it because they seem to keep the minimum payments so low. At this point, they "own you" because it will take you at least 35 years to pay them back - all the time they are making huge profits on the interest. Therefore, do not feel any shame about taking back control of the situation. They have all the power at this point. If you do not pay, they will sue you and freeze your bank accounts, garnish your wages, execute against your property, put judgments against your house or even attempt to hold you in contempt of court for not paying your bills. They have spent almost a billion dollars to lobby Congress to get rid of Chapter 7 Bankruptcy. You ask why spend so much money to do this? The reason is that bankruptcy is the only protection you have. They don't want you to have any protection! They want total control! Fortunately, their efforts, thus far, have failed. Therefore, if you want to take control of your financial life and are considering bankruptcy, you need to talk to Bankruptcy Attorney Scott Humble who offers you a free consultation to discuss your financial future. He understands your situation.
Chapter 7 Bankruptcy
In a nutshell, a Chapter 7 discharges unsecured debt and allows you to surrender secured assets, which you do not want to keep.
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy in a nutshell, is about reorganizing your debt and restructuring your debt so that it is affordable for your income. It is possible to restructure all debt with the exception of the first mortgage on your house.
Credit Card Debt Management and Consolidation Services
To put it bluntly, credit card counseling and debt management services are rip-offs. Approximately 50% of my clients have been in consumer credit counseling with absolutely no success and retain our services after spending thousands of dollars needlessly with these types of organizations. Consumer credit counseling is presently under investigation by the Federal Trade Commission, Congress and the IRS. The Federal Trade Commission has shut down thousands of consumer credit counseling services because of the fraud involved. Furthermore, even the good consumer counseling services are funded by the credit card companies. They are supposedly organized as "not for profit" organizations. But, if they are funded by the credit card companies, how can they possibly be on your side? The answer is, they can' be. Furthermore, the general perception in the public is that "not for profit" corporations are good, effective, and truthful. However, what is the largest "not for profit" organization that we all deal with everyday? Answer: The government. Is the government always good, effective, and truthful? I don't think so. Furthermore, if you are presently involved with consumer credit counseling service, you should immediately pull a credit report to see what the status of your accounts is. The probability is that these accounts are being shown as paid late. Moreover, if you contact your credit card companies directly, chances are that late fees at a minimum are still being added to your account. Therefore, it is likely that your principle balances on their accounts are going up. Additionally, consumer credit counseling will be on your credit report as a creditor. All of the foregoing tells creditors that you are a bad risk which does not make credit available to you. Consumer bankruptcy attorneys and lawyers are all about empowering you. Consumer bankruptcy attorneys are about taking back control of your financial life. For further information, Click here .
Credit After Bankruptcy
Nearly every one of my clients, at one time or another, has asked me about getting credit after bankruptcy. The fact of the matter is that there are banks and credit card companies that now specialize in providing you with credit after you have filed a bankruptcy. Providian and Capital One are very aggressive in this area. If you think about it, they feel the risks are minimal, as you cannot file another Chapter 7, for example, for another six years. However, we can file a chapter 13 before 6 years. They will be able to make thousands of dollars in interest off of you if you are willing to begin using their services again. Many times, a bankruptcy will improve your credit score. Part of your credit score is based upon available credit. Many clients, prior to bankruptcy, do not have any credit left available or have not made timely payments over the last seven years. Moreover, their income to debt ratio is not with in the parameters acceptable to many banks. Bankruptcy will resolve both of this issues. It is true that bankruptcy will stay on your credit report for up to 10 years following the discharge. But, that does not mean that you will not receive credit. I have had numerous (most) clients purchase new vehicles after filing bankruptcy. The local banks also tell me that they will consider extending credit for the purposes of buying or re-financing a home mortgage after 2 years from discharge. The other possibility is to now live life without credit. Would it really be so bad to pay cash for everything and not get in this situation again? Most people can't imagine living without credit. They think it is a scary proposition. However, it is possible to live without credit - and it actually is much less stressful.
Choosing a Bankruptcy Attorney
I am always amazed how it sometimes appears that people do not take much time in choosing a bankruptcy attorney. This is a very important decision and should be given strong consideration. If, for example, you need heart surgery, you certainly would not go to a general practitioner. You would go to a heart specialist. The same applies to different specialties within the law. If you needed a real estate transaction done, you wouldn't necessarily go to a bankruptcy attorney. The converse is also true. You should not go to a real estate attorney if you need a bankruptcy. What I see everyday is clients going to a general practitioner for a bankruptcy. General practitioners are not able to offer the same options as a bankruptcy specialist. Someone that specializes in bankruptcy is able to offer you all of the options, as that is what they do all day every day. Many of the options are so time consuming and complex that general practitioners are not able, for practical reasons, to offer them to their clients. Therefore, general practitioners rarely offer Chapter 13 bankruptcies with or without "POND motions" to their clients. (A POND motion generally saves you 95% on a second or third mortgage.) Additionally, bankruptcy specialists from large cities, attempt to induce their clients into filing solely Chapter 13's because the bankruptcy attorney's fees are more plentiful. However, if you would like all of your options presented in an unbiased way, you need to contact us at Humble Law Offices.
How to Pay the Attorney
On nearly every case, we are asked by perspective bankruptcy clients how they can possibly pay for the bankruptcy court protection. As aforementioned, we do accept payments. However, during your meeting with a bankruptcy attorney, he or she will advise you what bills not to pay so that you can divert some of your income to paying your bankruptcy attorney while still protecting your assets.
What to Expect at Court
One of the most dreaded things about the idea of filing a bankruptcy is the dreaded court appearance. However, the experience is not nearly as bad as most of my clients anticipate. I can't tell you how many countless times I have walked out of court with my clients and they tell me, "that wasn't bad at all, I was expecting to get grilled and none of that took place." Bankruptcy court is unlike most other courts. Although the experience is somewhat stressful, it is not "adversarial" such as a divorce or a criminal proceeding or even a personal injury proceeding. Essentially, the trustees and the court are looking at the numbers involved. The numbers involved actually determine what type of bankruptcy you should file, how it should it be filed and how much you should pay and when.
What Questions Will Be Asked At My Hearing?
(These are sample questions)
- What is your name?
- What is your address?
- What is your social security number?
- Please verify your employer.
- Please verify your income.
- Please verify your tax refund.
- Did you list all of your assets and liabilities?
- Are these your signatures?
- Did you review the information sheet provided by the United States Trustee?
- Have you given away any property?
- Have you recently won the lottery or do you intend to inherit any property within the next 6 months?
- Have you given away or transferred any property within the last year?
- Why did you file for bankruptcy?
- Do you have a personal injury lawsuit pending or can you collect any money or anything of value from anyone in the next six months?
- Do you have proof of full insurance coverage on your car? (Please bring proof of insurance with you to the hearing.)
- How much is your home worth?
- Why do you believe it to be worth that amount?
- How much is your normal tax refund?
- Have you given away anything of value in the last year?
- Have you transferred any real estate in the last 10 years?
- Do you have any mineral or gas rights?
The Trustee is there not only to be sure the paperwork is done properly and that all questions are answered truthfully, but also to collect any assets that aren't protected. Your 341 meeting is not a time to brag about how your property is worth a lot of money. However, it is a time to be completely truthful. If you have any questions regarding your case, it should be done with me prior to going in front of the Trustee.
What Should You Bring To The 341 Meeting?
You should bring photo identification (driver's license, passport, military ID) and proof of your social security card, (said proof must be original social security card, original W-2, etc.), a copy of your face page showing full coverage of insurance on your vehicle if you owe money to the bank on your vehicle. If you have not already provided up to the date of filing, sixty days of pay stubs, three years of tax returns, three months of bank statements and check registers, a copy of your deed and mortgage, if any, and a copy of your car titles, please bring them to your 341 meeting.
Your Financial Future
There are many ways to make sure that you are a financial success. Most fortunes are made slow and steady each day by living within a budget and below their means. I have attached several sample budgets, which indicate they "break even". Most fortunes also include a 15%-20% savings for retirement. After surveying 1,115 billionaires across the country, the authors of "The Millionaire Next Door," by Thomas Stanley and William Blanco summarized 7 common characteristics.
- They live below their means, often in modest homes and own modest cars.
- They allocate their time, effort, and money in ways to build wealth.
- They believe money in the bank is more important than spending money to "keep up with the Jones."
- They do not provide financial support to their children or grandchildren. Instead, their adult children were taught to be economically self-sufficient.
- They are proficient in targeting and taking advantage of market opportunities.
- They choose the right to occupations to allow them to invest and gather money.
All in all, the philosophy of the "The Millionaire Next Door" is that money should work for you, you should not work for your money.
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