San Diego Bankruptcy Attorney Blog

More from a San Diego bankruptcy lawyer
Wow. Time really flies. The next time I write a blog it will be March 2010. Wasn’t it just yesterday or so that I was thinking how interesting and palindromic it was on January 11th this year (01/11/10)? Or that I was celebrating New Years Eve? I mean, 2010; that was the SEQUEL to 2001. And it was weird in 2001 when that movie about the future was actually about the “now.” That’s sort of like how Prince must have felt when his “Party like it’s 1999” song was actually, temporally, true (it was originally released in 1982).

As a San Diego Bankruptcy attorney, what this means to me is: if you are thinking about filing bankruptcy, or are sure you need to, the sooner you do so, the better. Who knows what the future holds? Start the future now. Trying to hold on to debts which you’re running out of the ability to pay – when a Chapter 7 or Chapter 13 bankruptcy is a reasonable and available option for you – is probably unwise. The truth is, if your finance curve is pointing down, and has been pointing down for some time, it’s unlikely to turn around swiftly. This means you’re going to continue to pay on debt you really don’t have to. And since the greatest negative associated with bankruptcy is the credit hit you take, the sooner you file bankruptcy the sooner your fresh start will yield an upward-pointing finance arrow. And since time moves forward unendingly and nothing between now and “then” is actually, truly predictable, why wait to avail yourself of the help that’s out there for you? After all, does it really feel like three years ago that Will Smith was fighting zombies in “I am Legend?” or two years ago that you watched the opening ceremonies in Beijing?

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego Bankruptcy Attorney comments on the Mortgage Bankers Association

The Mortgage Bankers Association (MBA) is a group of 3000 or so companies whose membership is made up of leaders in such industries as real estate finance, mortgage holding, mortgage brokering, and banking. They are, in essence, lobbyists. While that term may have negative connotations (unless a lobbyist is lobbying for something you’re in favor of!), what they’ve come up with recently is anything but negative. Check this out: http://www.mbaa.org/NewsandMedia/PressCenter/71954.htm.

Specifically, the MBA has developed a concept which can aid homeowners who lose their jobs by reducing monthly payments during an unemployment period. Since the data show that six to seven months is the average time it takes to find a new job, your bank would allow you to pay a reduced amount for up to nine months and then re-evaluate your financial condition once you’ve found new work and even consider you for a loan modification under the Obama Administration’s Home Affordable Modification Program (HAMP). While the details are not fully unveiled, I would assume that the modified payment structure during the unemployment period would NOT be negatively reported – or at least not akin to a missed mortgage payment. The lenders do not want to continue to own property; they want us to own it. If we’re not in it, they’re not making money on the interest and fees. Therefore, because people would miss payments if they lost work (or because purposefully missing payments is a strategy employed by people seeking a loan modification regardless of employment, such as those in non-recourse states like California who realize that the drop in home prices gives them leverage against the bank), this plan incentives the newly-unemployed to keep paying the banks – albeit a reduced amount – yet also yields a potential benefit to the homeowner by avoiding a late-payment report and by securing a HAMP modification opportunity.

Keep in mind that this is just a concept in development and is not in any way implemented en masse. For now, it is, at least, good public relations; and, if truly implemented, would offer a real benefit to the homeowner who loses her job. And, after being much of the cause of the problems (i.e., predatory and subprime lending), anything positive is appreciated.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego bankruptcy attorney shares information on credit cards

The average household has nine credit cards. Wow! In fairness, though, I assume this includes gas cards and Macy’s -or Sears-type cards. Frankly, I’m sure anything that charges interest, has a Visa/Maestro-style logo on it, and has a magnetic strip on the back is considered a credit card. Ah, the good old days, and I don’t mean just ten years ago when people carried cash; I yearn for the days of bartering: I’ll give you this chicken and those six cumquats for a bag of flour, a sack of sugar, and a lift back to my fiefdom. But we serfs have fought back yet again (not that the end to feudalism was accomplished swiftly). On the day the Credit CARD Act of 2009 went into effect (that is, Monday, February 22, 2010), President Obama said, “For too long, credit card companies have had free rein to employ deceptive, unfair tactics that hit responsible consumers with unreasonable costs. But today, we are shifting the balance of power back to the consumer and we are holding the credit card companies accountable.” For a discussion of the new law, see my earlier posts or try http://iphone.usatoday.com/News/1516112/full/.

Unfortunately, the “balance of power” the President refers to is so one-sided that it’s like exchanging a 200-pound man for a 300-pound man on a see-saw where, on the other end, sits a 41-pound third grader. Nonetheless, any progress is good progress. And, indeed, a journey of 1000 miles begins with a single step. As a San Diego bankruptcy attorney I see every day how the ubiquity of credit drives people toward Chapter 7 bankruptcies. Take a look at how the real estate bubble drove lenders to lend to subprime borrowers. In my mind, the problem is the predatory lending, not the guy on the street who answers in the affirmative when asked if he’d like to own a home with no money down and no proof of income. The good news is that bankruptcy laws are written to protect you. Presumptively, so too was the Credit CARD Act of 2009. Next step, the Credit CARD Acts of 2010, 2011, 2012…

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego bankruptcy lawyer discusses credit and job applications...

A recent article I read from my San diego bankruptcy law office talks about how bad credit can affect a job hunt. Sometimes, it can even get someone fired. Traditionally, bad credit is only used to discriminate against potential employees who work either as senior management, within the finance field, or around cash. The credit inquiry into applicants’ personal lives seems to be expanding, however. This is certainly unfortunate. Many would say it’s even unlawfully prejudicial against minorities (indeed, law suits are under way). Some legislators are taking action, but progress is slow.

Bankruptcy – especially a San Diego Chapter 7 bankruptcy or a successfully completed Chapter 13 plan – will mean a discharge; and with a discharge, a fresh start. This fresh start will yield, presumptively, improving credit . Combine this with the legal concept that employers should not discriminate against those who file for bankruptcy and what emerges, at least to this San Diego bankruptcy attorney, is that getting a discharge sooner rather than later is a wise choice. Getting that fresh start not only impacts you on a day-to-day basis, in that it helps to significantly relieve your financial troubles, but it might also benefit you down the road, too: i.e., when you start looking for a new job and your credit is on the road to improving, rather than holding you back in the eyes of an employer.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego attorney remembers when...

Happy Birthday, Credit CARD Act of 2009. Today, February 22, 2010, is the day the landmark credit legislation becomes law. Perhaps, then, I should say, “Happy Implementation Day,” since it is now 2010 and the legislation was originally “born” in mid-2009. But like all birthday-type events, this one is also worth celebrating. I previously blogged about the various elements of the law itself, so I will refrain from doing so again, but the Act is one grand step toward making lenders a bit more accountable. Congress, of course, has to walk the fine line between protecting citizens and promoting free enterprise (indeed, a bound catalogue of the Supreme Court cases which address the Commerce Clause of the Constitution would themselves form a voluminous tome; for briefer reading, try Dan Coenen’s Constitutional Law: The Commerce Clause). This first step of Congress, however, does NOT put a cap on interest rates. I would predict this selective omission will be addressed at some point in the not too distant future. This means, of course, that credit companies can charge ridiculously high interest rates, so long as they have disclosed this to you, the customer. As a San Diego bankruptcy attorney, I deal every day with debt associated with credit cards. It is the reason Chapter 7 bankruptcy filings are so prolific. Be careful, then, in taking on any new credit card. Read all the disclosures (yes, reading fine print is annoying) and, in this time of information, check the internet for reviews and insights into those offering you credit. They may be trying to take advantage of anyone they can, specifically those who fail to read up on what they are signing up for. For additional reading, try this.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego bankruptcy attorney has more to say on the Olympics...

It sure was neat watching Shaun White’s gold medal run in the Olympics last night. It was even more interesting after they showed his bio – hometown: Carlsbad, California. Congratulations, Shaun…and to all the United States’ Olympians. No doubt the Olympic heroics of our other locals will be better in Summer than in Winter…but the Flying Tomato sure made one heck of a snowy showing. As a San Diego bankruptcy attorney, I take a special pride in local successes. One area where San Diego is ahead of the bankruptcy curve is in the commitment of the local court (and trustees) to institute an all electronic approach to case management. That is, effective March 1, 2010, all documents filed by attorneys into the Southern District of California Bankruptcy Court is to be done electronically through the CM/ECF (Case Management/Electronic Case Files) system. See General Order 162-A here or go to the court’s website . This mandate for electronic filing will facilitate easier compliance with the trustees’ requirements for post-filing paperwork presentation (see 11 USC §521 and local rules). Electronic filing is not available for non-attorneys, of course; and paper filing (at the window) for people without lawyers is notoriously annoying. In my view, electronic filing is just one more reason to retain counsel for a San Diego Chapter 7 or San Diego Chapter 13 bankruptcy filing. Applause, then, to the court; and to Shaun White.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego bankruptcy attorney chats about the Olympics...

All this Olympic action has me thinking two things: firstly, why can’t I get live evening events on TV when the Olympics are in our own dang time zone; and secondly, gold is nice. As to the first question, I know the answer, but I just don’t like it. NBC has apparently decided that it’s better to alienate some elements of the West Coast viewing audience in hopes of getting greater viewership during primetime, presumptively by those who either don’t care the events aren’t live or who haven’t seen the results (and can, accordingly, try to convince themselves the feeling is the same as watching it live). And the second thing: gold. Well, I know I’ll never get one of those medals. Kudos to all those people who strive for years and years, training and sacrificing. What a great accomplishment to win one – or fourteen, if you’re Michael Phelps. Of course, true success is in the effort itself, but a winner must be crowned, and it sure would be nice to hear your own national anthem as you stood atop the podium.

Gold as a market commodity, however, doesn’t have the same illustrious history that the Olympics do. Check out the history of the price of gold at www.measuringworth.org . The New York market price is the most interesting. Gold was worth $193 in 1978, then $307 in 1979, $612 in 1980, then $459 in 1981 before bottoming out in 2001 ($272). It’s now worth $950 or so per ounce, so if you got in at the right time, you did well. But just because it’s gold, it’s just as shaky an investment as anything. I just gave you the history over the last thirty years. Saving is a difficult thing to do. As a San Diego bankruptcy attorney, I discuss families’ finances every day. If money comes in the door, it usually goes out. That’s why a dedicated savings plan is the best way to save. Telling yourself you will save when things turn around will usually end up just getting you into more debt, strange as it may sound. The good times yield additional spending, and only rarely yield additional savings. Chapter 7 bankruptcy is a fresh start, allowing you to eradicate your unsecured (i.e., credit card) debt. If you do file for a San Diego bankruptcy, use that fresh start to your advantage. Carefully consider adjusting your spending and savings habits after your discharge is granted. Many resources are available to help you do this. While filing for a Chapter 7 bankruptcy might feel like a big decision, it should also feel like... a golden opportunity.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego bankruptcy attorney speaks on the city's pension

I blogged recently about the need for San Diego to consider a municipal bankruptcy. It seems that idea hasn’t lost all traction. Check out this story from the voiceofsandiego.org: http://voiceofsandiego.org/government/article_0418be36-1aa3-11df-840f-001cc4c03286.html

The thesis of the story seems to be that, “[I]t appears legally possible for a city to reduce pension benefits through bankruptcy. No one has tried it before, but someone will. That bankruptcy will be a costly war with an uncertain outcome.”

In other words, the talk right now is that if San Diego does declare bankruptcy, the $2.1 billion pension obligation will remain untouched. What’s the point, however, in going bankrupt if the largest obligation remains unaffected? Good question. State law mandates that no municipality may affect its pension debt through bankruptcy. Bankruptcy is federal law, however, and that opens the door – however slightly – for a judge to, in fact, do something with that pension debt. I would imagine the federal Supreme Court would chime in to resolve the issue, but the concept is out there and the legality of it is uncertain. The declaration of bankruptcy itself might incentive the pension holders to reduce their debt from $2.1 billion or restructure it somehow. The threat of bankruptcy, then, can itself be a motivator, even if the question of affecting the $2.1 billion is an unknown. Stay tuned.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San Diego Bankruptcy Lawyer talks about the 341 hearing gone bad...

In keeping with San Diego Bankruptcy Attorneys keeping San Diego consumers and San Diego Consumers in debt informed about the 341(a) hearing (the “first meeting of creditors”), I thought I’d take a moment to applaud the good lawyers out there – and this includes myself and Sagaria Law, in general – for never being the main character in one of the periodic horror stories that occasionally take place at the hearing. What I mean is, sometimes a 341(a) will go badly. Sure, a debtor in pro per (that is, without a lawyer) will sometimes stumble, say, by answering a question in a way that contradicts their petition or not knowing an answer at all or not having amply prepared supporting documents that the trustee requests prior to the hearing, but that’s excusable: the average Joe who tries to file a bankruptcy in San Diego – even the most basic Chapter 7 – doesn’t know what he’s doing. I wouldn’t know how to fix a carburetor; everyone’s got their thing. Ultimately, with a pro per debtor, it might take a bit of back and forth with the trustee and significantly slow down the granting of a discharge, but things will generally resolve. That’s not much of a horror story, at least from my perspective. As a San Diego bankruptcy lawyer, horror to me is watching a 341(a) go badly for the lawyer.

If a lawyer shows up at the hearing, because the trustee is himself or herself a lawyer, the trustee is usually much more cordial to the lawyer than they might be to a debtor in pro per if issues arise. The worst that seems to happen is that the lawyer experiences a bit of embarrassment – especially painful, I’m sure, because it happens in their client’s presence – but is resolved with a request to continue the matter so the lawyer can get themselves more properly prepared. But when a debtor has a lawyer that doesn’t show up or, worse, the debtor reveals to the trustee that a lawyer prepared the petition but the relationship is not disclosed as required, that’s a real problem. Invariably the trustee will ask the debtor for the name of the attorney and how much he or she was paid; and the trustee will then either question the debtor or excuse them with a continued date down the road. What the trustee does with the name of the lawyer I, thankfully, do not know. Nor will I. That is simply not how I practice law. Client commitment is of paramount importance. Period. It is the very backbone of legal counsel. I’m sure the bad lawyer gets in trouble somehow. And though they are a colleague, I am glad they do.

So the morale of the story is that you should be careful who you hire when you retain counsel. Be sure you are actually retaining counsel and not merely a document preparer, unless it is merely a document preparer you seek. Even in that event, that relationship must be disclosed. The story is not an uncommon one. Poor lawyering is, sadly, quite common. Be sure to ask the right questions of your lawyer, just as you might a doctor. Be comfortable with them. Review their discipline record at the State Bar website, if you want. A San Diego bankruptcy lawyer retained to handle your local San Diego Chapter 7 or San Diego Chapter 13 (both require attendance at a 341(a) hearing) can, and should, provide comprehensive management of your case. My clients often tell me that having a lawyer was wonderful and made their bankruptcy smooth and easier than expected. I really appreciate that. That’s precisely what we are going for. Cheers, then, to the good lawyers. I and our firm are proud to be amongst them.

If you have questions regarding Bankruptcy in San Diego County, including Carlsbad, San Diego and surround cities in San Diego County please contact us at (760) 579-7322 for a free consultation or visit www.bkanswers.com . Or call toll-free (1800) 941-6730 to be connected with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in our Carlsbad bankruptcy office. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankruptcy staff supporting San Diego consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

A San diego Bankruptcy Attorney comments on municipal bankruptcy...

From my San Diego bankruptcy law office, I blogged recently about the need for San Diego to consider a municipal bankruptcy. It seems that idea hasn’t lost all traction. Check out this story from the voiceofsandiego.org: http://voiceofsandiego.org/government/article_0418be36-1aa3-11df-840f-001cc4c03286.html

The thesis of the story seems to be that, “[I]t appears legally possible for a city to reduce pension benefits through bankruptcy. No one has tried it before, but someone will. That bankruptcy will be a costly war with an uncertain outcome.”

In other words, the talk right now is that if San Diego does declare bankruptcy, the $2.1 billion pension obligation will remain untouched. What’s the point, however, in going bankrupt if the largest obligation remains unaffected? Good question. State law mandates that no municipality may affect its pension debt through bankruptcy. Bankruptcy is federal law, however, and that opens the door – however slightly – for a judge to, in fact, do something with that pension debt. I would imagine the federal Supreme Court would chime in to resolve the issue, but the concept is out there and the legality of it is uncertain. The declaration of bankruptcy itself might incentive the pension holders to reduce their debt from $2.1 billion or restructure it somehow. The threat of bankruptcy, then, can itself be a motivator, even if the question of affecting the $2.1 billion is an unknown. Stay tuned.

Any cursory internet inquiry into a Chapter 7 or Chapter 13 bankruptcy will yield that going to a certain hearing is mandatory. This required hearing is governed by the law within 11 USC § 341(a) and it is called the “first meeting of creditors.” Having attended many, I thought a San Diego-specific discussion over the next few days might prove a worthwhile topic.

To begin with, the “first meeting of creditors” is generally also the last meeting of creditors; and, furthermore, the meeting of creditors generally has no creditors. Don’t get me wrong, the 341(a) is a per se invitation to your creditors to come and question you, usually for the purpose of attempting to discovery assets that might be hidden (so they can be sold by the trustee and a portion thereof given to the trustee), but what happens in most cases is that the creditors realize it would be too expensive to send someone to attend a hearing only to discover that no assets truly exist which could be marshaled for sale. Indeed, most San Diego Chapter 7 bankruptcy cases are called “no-asset cases.” That is, the debtors have no assets that the trustee can take and sell. In other words, you get to keep everything you own. Additionally, even if a creditor were to show up, the trustee’s calendar is so busy that only a minute or two of questioning is really permitted. The trustee will simply ask the creditor to file paperwork with the court to set up a question and answer session with the debtor. The trustees have lots of debtors to question at the 341(a) hearings. As a result, there isn’t much time granted to a questioning creditor.

I will discuss other aspects of attending a 341(a) hearing here in San Diego in coming blogs.

If you have questions regarding Bankruptcy in San Diego, Carlsbad, and the surrounding areas of San Diego County please contact us at (619) 209-6046 in San Diego, or (760) 579-7322 in Carlsbad for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in an office location nearest you. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!

“Bankrupcy Schmankrupcty.” Or something like that. Mayor Jerry Sanders rejected even the notion that San Diego consider bankruptcy as a solution to its financial woes when asked last week about keeping all options on the table. The details of San Diego’s finances are beyond the scope of this blog. Indeed, they are beyond the scope of this blogger. Were they easy to contemplate fully, they might be easy to fix, and any San Diegan knows there’s no easy fix on the way. The problems go back a long time, threatening even to cost us the Chargers; and the problems continue with no solution in sight. Of course, a consumer bankruptcy in San Diego – like a Chapter 7 or a Chapter 13 that you might file – is nothing like what San Diego would do if it filed for bankruptcy. A city that files bankruptcy would file for a Chapter 9. Yes, there are even Chapter 12 bankruptcies and Chapter 15 bankruptcies. A Chapter 9 bankruptcy is for municipalities. Orange County, our neighbor to the north, filed such a bankruptcy – the largest Chapter 9 in American history – in 1994 after investments of over a billion and a half dollars ran amuck.

Two things strike me when considering the above. Firstly, maybe the mayor should keep his options open. There are budget deficits projected for many years to come. Slashing spending is ridiculously difficult (on the government level) and raising taxes is unpopular, if not wholly useless as taxable revenue streams dry up as a result of increased taxes (a vicious cycle). I’m not saying San Diego should file bankruptcy; I’m not well enough versed on the city’s budget and revenue to make a carefully informed decisions, but ruling it out as an option seems to negate the value that bankruptcy is intended to provide. Indeed, Chapter 9 exists exclusively to be utilized in times of need. The same holds true for a local, yet smaller, consumer Chapter 7 bankruptcy or a wage-earner Chapter 13 bankruptcy: the law is there to be invoked in times of trouble. A number approaching two million Americans will avail themselves of such options this year alone. Dismissing bankruptcy as an option is doing yourself a disservice, just as it might be foolish to unilaterally take bankruptcy off the table for the city.

Secondly, a city (or county) in distress offers a unique consolation when considering a consumer’s situation. That is, if a place with millions of people (and millions of tax-paying citizens and businesses) can get into financial trouble – even with dedicated people assigned to monitor the finances – how much easier is it to see that economic distress is just what happens sometime…to everyone. Consult a local San Diego bankruptcy attorney to discuss how your bills are catching up to you. And keep bankruptcy on the table. The relief it offers is real, and as part of the law as anything else.

If you have questions regarding Bankruptcy in San Diego, Carlsbad, and the surrounding areas of San Diego County please contact us at (619) 209-6046 in San Diego, or (760) 579-7322 in Carlsbad for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Diego Bankruptcy Attorneys. After you have spoken with one of our San Diego bankruptcy attorneys, we can schedule you for a free face to face appointment in an office location nearest you. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Deigo consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, Southern California!