Recently, I have foun that it is more chapter 13 clientsl contact mes within just a few weeks of a foreclosure auction. Sometimes, it’s just a few days. And even sometimes it is the next (or even the same) day. Never before have I spoken to them. Never before have they contemplated bankruptcy. And never before had they thought they would have to.
I can understand all of that. No one wants to think of bankruptcy. When you open up a high school yearbook and it says “Future Ambition” or “Future Plans” you’re never going to read: “I am going to buy a house, have kids and file bankruptcy.” Years ago, I was active in a local chamber of commerce and a fellow business owner suggested that I not tell people that I was a bankruptcy lawyer since it seemed to “make people cringe.” (Frankly, I feel the same way about dentists, but I would not tell a dentist that.) I didn’t follow their suggestion.
So when people come to me hours, or just a few days prior to an auction, I often hear that they have been trying to work out a modification, but have not been successful. They have been hoping to sell the property, but have had no luck. They have been hoping for a miracle, and nothing good for them has come of it. And now, in my office, they hope I can file bankruptcy protection and get them back on track. And when I start mentioning what I will need to properly prepare the filing, many – if not most understand that they should have had “Plan B” lined up months ago. I am now facing issues which would have been avoided (and if I can avoid them, I can focus on other important issues).
I need four years of tax returns or transcripts. That might prove difficult if tax returns have not been filed in two years. It does not change the fact that I need them.
I need pay stubs or payments advices. If you have been throwing them away, you’re going to have to spend time getting them.
I need bank statements. Sometimes I need a year of them. Sometimes, I need more.
And I also need a plan. “Plan B” is not just about filing bankruptcy. It’s about figuring out a way to keep the house, or to minimize the prospect of losing your shirt. I am going to ask: “how are you going to do it?” And we’re going to need to put our heads together to come up with a plan. All of this takes time, and time is a good thing.
There are many reasons why people get into financial difficulty. There are many options available in chapter 13 but they may be limited if you have not considered “Plan B” all along. I know that no one likes to think of bankruptcy. No one wants to be a debtor in bankruptcy and people should explore other options besides filing bankruptcy, including picking up the phone and speaking with the mortgage company. But exploring options is no reason to not have a “Plan B.” And let me stress that it is not just about having have a “Plan B.” You have to know what the “Plan B” is and how it will affect you and your situation. So if you’re reading this, it does not matter whether you find yourself in the middle of a financial storm, or whether you only see dark clouds on the horizon. Learn about “Plan B” now.
Storm Preparation is a weekly series appearing on Wednesdays and offers tips and information to people who think they may need bankruptcy protection in the future. Questions, comments or suggestions can be addressed to info@mcleodlawoffices.com.
Related posts:
- Storm Preparation: Look at your Debt and Plan Accordingly
- Storm Preparation: Letting Go and Moving On
- Storm Preparation: Over Withholding
- Storm Preparation: Chapter 13 and DSOs
- Storm Preparation: Acceptance
Tags: Plan B, Storm Preparation
