A few years ago, someone wrote something somewhere (it wasn’t here – I swear) that if you were the victim of predatory lending, you could get a free house. Actually, I recall someone at a legal seminar (not here in Massachusetts – I swear) suggesting that it could be done… which sent some colleagues of mine into a tizzy thinking they could easily get free houses for people who were preyed upon by bad bankers. If that could be done with such ease, then there would be firms not only doing this work, but we’d be reading billboards declaring their success rates on the sides of highways.
Archive for the ‘Chapter 13’ Category
Saving the Home: Thinking Beyond “Delay and Pray”
Saturday, January 30th, 2010
The foreclosure numbers don’t lie. According to ForeclosuresMass.com, a total of 478 new foreclosures were filed this week (ending January 29, 2010). Approximately 56 homes slipped into foreclosure every day for the last 60 days. The economy is far from a turn around.
HAMP is not really working – at least in not any meaningful way. Homeowners can expect a “delay and pray” modification or an “extend and pretend.” Taking arrears and putting on the tail end of the note, “delay” (which is a nice way of saying a “balloon” payment), means that for it to be paid off, the value of the property will have to increase (hence, the term “pray”). What seems more accurate is “extend and pretend.” You can extend the terms, such as turning a 30 year note into a 40 year note. Of course, the “pretend” comes into play when you want to “pretend” you want to live in the property, “pretend” that the economy and the housing market will turn around so that you still won’t have to come to the closing table with a checkbook in hand.
HAMP is not the only option available to homeowners trying to avoid foreclosure. There’s HARP, there are short sales and there is the possibility of keeping the home under bankruptcy court protection (either in chapter 13 or 11). While bankruptcy should be one of the last options, I am always surprised at people who quickly dismiss it altogether – especially when it’s the best option available.
Consider this scenario:
The Stuff You Find on Craig’s List
Monday, January 4th, 2010
Sometimes, clients will share with me news bytes and other tit bits that I often share with clients. But today, a job-seeking client shared with me a post they found on Craig’s List that was both funny – and a bit troubling.
‘Tis the (Tax) Season
Tuesday, December 29th, 2009
The holiday season is almost over and January 1 is the official start of tax season. For people considering bankruptcy, it’s also a time to start getting those 2009 tax returns promptly. I’ve written about this important subject before, and it’s worth bringing it up again on the eve of tax season. Here’s why. (more…)
Means Test Not Required in Converted Case
Monday, December 7th, 2009
If you file chapter 7, you need to complete Form 22A, the Statement of Current Monthly Income and Means Test Calculation. But if you file a chapter 13, and then convert the case to chapter 7 are you still obligated to file the Means Test form? A Massachusetts Bankruptcy Judge has ruled on this important issue (In re Guarin, 09-42294 JBR).
What Does a Good Bankruptcy Attorney Do?
Friday, November 27th, 2009
I’ve compared my role as a debtor’s attorney as similar to that of a boy scout. My job is to help my debtor client cross the road without getting hit by the bus. A big part of that job is done while preparing. In essence, I get behind the steering wheel of the bus and I ask myself “if I were trying to run over the debtor, what would I be looking for first?” Perhaps a better, and far less macabre way of looking at how I do my job is this: when preparing my client’s case, I pretend that I am trustee and I ask myself: what has my client told me or shown me that would send up a red flag. What could make my client’s life even more difficult than it already is?
When the Ex Files Bankruptcy
Wednesday, November 25th, 2009
The relationship is over, but there are still lingering issues that hold you together. Perhaps it’s child support, health care, property distribution or other matters. If your ex files bankruptcy, it is very important you understand your rights and your responsibilities – as well as your options.
Security Clearances & Bankruptcy
Thursday, November 12th, 2009
Occasionally, clients will ask me about whether their security clearance is at risk if they file for bankruptcy protection. This came up yesterday when I came across a comment from a reader who expressed real concerns over his fear of losing his clearance if he filed. Why? The simple reason is this: no security clearance = no job. Yet the answer to the question is not an easy one to paint with one large generalized brush. But I’ll do my best.
Honesty and Bankruptcy, Part III: The Reality Check and the Boy Scout
Monday, November 2nd, 2009
In the last two entries, I shared my observations of honesty and dishonesty in the bankruptcy process. It has been an issue that has been crawling under my skin for many months now. And in this last installment of Honesty and Bankruptcy, I explain why that is.
Honesty and Bankruptcy, Part II: Feeling Dishonest
Sunday, November 1st, 2009
It seems that many people are hypersensitive over H1N1. I was at the market yesterday and an older man sneezed, and by the looks on the faces of those standing around him, you’d have thought someone nearby was pointing and shrieking that he was a leper. Just because someone is sneezing or coughing doesn’t mean they have the swine flu. Just because someone is in bankruptcy or needs bankruptcy protection doesn’t mean they are dishonest. And just because someone feels like they did something dishonest does not mean that they don’t deserve bankruptcy protection. In other words, feeling dishonest is not the same as being dishonest.
