Debt Relief

Denver Debt Collectors Resort to Facebook, Twitter

By now, everyone understands that Facebook and other social media sites are subject to public consumption, and as such, we need to be mindful of the information we submit.

However, one aspect that we often don’t think of it affecting is our issues with Denver debt collection.

In fact, as our Denver debt relief attorneys understand it, social media is in fact becoming an increasingly-used tool for debt collection agencies.

There have been reports of certain collectors setting up fake profiles to friend those who owe, and others who will message or tweet your friends and family to ask where you might be.

Is it intrusive? Absolutely. Illegal? Probably, at least in some states.

The Fair Debt Collection Practices Act was set up in order to protect consumers from debt collectors who abuse the system.

And Colorado statute C.R.S. 18-5-113 does prohibit someone from impersonating another for his or her own benefit.

However, when the federal law was passed back in the late 70s, it was way before the age of Twitter and Facebook. There have even been lawsuits filed when debt collection agencies have taken this take.

But that doesn’t mean you shouldn’t be cautious.

If you want to circumvent these types of problems, there are some steps you can take.

One is to respond to collection letters within a month. If you owe the debt, the agencies can still sue you to pay it, but if you write them a letter notifying them not to contact you through that or any other method, they must stop e-mailing or calling you.

Secondly, use your privacy settings. You don’t want to give debt collectors access to your pictures or any other information about you that would be available on your Facebook page. It’s possible that information could be used against you.

Thirdly, be very careful about what information you post. Sometimes, we have a false sense of security on our social media sites because we may assume the only people who are interested are those close to us. But that’s not always the case. Debt collectors can find your employer’s name, address and other contact information, your cell phone number and your date of birth.

Be selective about whose friend requests you accept. Don’t approve requests from strangers.

And finally, don’t use the “like” button for your bank or credit card company. That can give them a portal from which to gain information about you that you may rather they not have.

Denver Bankruptcy a Financial, Not Ethical, Choice

It’s unfortunate that some people still believe there is a stigma attached to Denver bankruptcy.

Our Denver bankruptcy attorneys have been dismayed when we meet clients who have tried to battle the massive debt on their own. They have worked their whole lives to build up a reputation as a solid, hard-working individual who pays what they owe. There’s nothing wrong with those ethics in theory, but the problem is when people drain their retirement funds and college savings and rack up credit card debt trying to make that happen.

But taking these measures to save an underwater home or get out from underneath mounting credit card debt is not the way to go, and will only lead you further into a financial tailspin.

The truth of the matter is, those mortgage servicers and credit card companies aren’t going to look after you in your retirement. Even just having the thought that you may need to dip into these savings to pay off your bills is reason enough to contact a Denver bankruptcy attorney to sort through your other options.

Sometimes, people make the mistake of trying to pay off one creditor completely, without trying to settle all or at least most of them. Using limited funds to pay off one creditor isn’t going to solve your problem.

What drives people to make these unwise financial moves? Primarily, guilt. People feel bad that they can’t pay what they owe. They feel ashamed. They feel like a deadbeat. So they try to assuage that guilt by throwing whatever money they have at the problem. But that’s not going to make these issues go away.

You have to start looking at the choice to file for bankruptcy as a business decision, rather than a moral or ethical decision.

One of the first signs that you may be in over your head is if you’re stressed about it? Are you losing sleep over it? Are you thinking about dipping into your retirement funds? Are you using one credit card to pay off another?

If so, it’s time to reach out for help. Be wary also of debt settlement companies that offer to fix all your debt related problems. Contact a trusted Denver bankruptcy attorney who can assist you in exploring your options.

A Closer Look: Colorado Foreclosures In Decline

In this second part of a two-part series on Americans and debt, Colorado debt-relief attorneys examine foreclosure trends across the state. In an earlier post to our Denver Bankruptcy Attorney Blog, we noted that Colorado ran second only to New Hampshire for over-the-month job creation in January, and Colorado bankruptcy filings have hit their lowest number since 2009.

In tandem with Colorado bankruptcy and unemployment numbers, foreclosure rates across the state are also dropping. The Colorado Department of Local Affairs reports that Colorado foreclosure filings are now at the second-lowest level reported since 2006, hopefully indicating some “true stability” in Colorado housing markets.

Data tracking quarter-to-quarter foreclosure rate comparisons for 2010 and 2011 show evidence of a decline, as follows:
~ Second quarter (2011) number of foreclosure filings: 7,233
~ Second quarter (2011) number of sales at auction (completed foreclosures): 5,333
~ Second quarter (2010) number of foreclosure filings: 10,233
~ Second quarter (2010) number of sales at auction (completed foreclosures): 5,887
Year-over-year second quarter comparisons indicate that in 2011:
~ foreclosure filings were down 29.4 percent with 3,000 fewer filings, and sales at auction (completed foreclosures) were down 9.4 percent with 554 fewer sales at auction.

According to the report, the drop-off in the total number of foreclosures has been attributed, to some degree, to the suspension or of many foreclosures in response to the so-called “robo-signing” controversy. While the initial slow-down spanned just October and November 2010, the legacy of that episode continues to affect the speed of the foreclosure process statewide. It is further believed that job growth and a continue surge in the national economic outlook also play a role in the drop in foreclosure filings.

With that said, the Denver Post is now reporting that thousands of Colorado homes are believed to have been lost to foreclosure in association with the controversy. And a second Denver Post report shows conflicting foreclosure rates from the Colorado Division of Housing and RealtyTrac indicating that for Colorado homeowners, the foreclosure nightmare is far from over.

If you are dealing with a Colorado bankruptcy or debt-related issues, contact the Law Office of Jon B. Clarke today to schedule a free consultation.

A Closer Look: Colorado Bankruptcy, Unemployment Track Decline

In this two-part series on Americans and debt, Denver debt-relief attorneys examine employment, foreclosure and bankruptcy trends across Colorado and the nation. While we are happy to report these three key indicators are all showing signs of recovery statewide, we also know that for many struggling Colorado families, the turnaround simply isn’t coming fast enough.

In their latest report, the Bureau of Labor Statistics indicates that 45 states, along with Washington D.C., each recorded unemployment rate decreases for the month of January, and that 48 states (District of Columbia included) registered unemployment rate decreases from a year earlier. In both instances, only New York saw an increase, while a handful of states saw no changes. Overall, the national jobless rate currently rests at 8.3 percent, down .8  percent since January 2011.

Across Colorado, the unemployment rate dropped one percent (from 8.8 percent in January 2011 to 7.8 percent in January 2012) during the last year. Between December 2011 and January 2012, Colorado ran second only to New Hampshire for over-the-month job creation with a gain of 19,500 jobs. The year-to-year comparison also showed modest growth of 43,400 jobs between January 2011 and January 2012.

A review of Colorado bankruptcy statistics published by the Administrative Office of the U. S. Courts indicate an ongoing decrease in the number of bankruptcy filings since reaching a peak in 2010. Between January and February of this year, there were 3,690 bankruptcy filings in Colorado. During the same time frame in 2011, records indicate there were 3,912 filings. Comparing the two captures: there have been 222 fewer filings in 2012.

The number of January-through-February Colorado bankruptcy filings since 2008 are as follows:
~ January and February 2012 bankruptcy filings: 3,690
~ January and February 2011 bankruptcy filings: 3,912
~ January and February 2010 bankruptcy filings: 4,050
~ January and February 2009 bankruptcy filings: 3,129
~ January and February 2008 bankruptcy filings: 2,493

Denver bankruptcy lawyers recognize that statistics indicating a bump in job growth and a decline in bankruptcy filings does not spell relief for the many families facing mounting credit card and other personal debt while fighting to stay out of a Colorado bankruptcy courtroom. At the Law Office of Jon B. Clarke, we bring decades of debt-relief experience and know how to help clients obtain a fresh start. To schedule a free consultation, call us at (303) 779-0600 today.

Colorado Bankruptcy Watch: State Senate Muzzles Employers Stalking Credit Scores

Colorado debt-relief attorneys applaud the efforts of Sen. Morgan Carroll (D-Aurora) along with the rest of the Colorado State Senate  for passing SB 12-003, otherwise known as the Employment Opportunity Act of 2012.

As part of a larger “Colorado Works” legislative effort that aims to increase employment across the state, the goal of  SB 12-003 is simple: to prohibit employers from using an applicant’s credit report information as a screen for employability — unless the position in question is directly related to money or asset management.

In addition, if an employer opts to not to hire an applicant based their credit report score, this reasoning must be disclosed to the candidate. Also, prospective employees must be given the opportunity to explain any negative information on their report. Failing to comply with these directives can lead to civil penalties. The bill now heads to the House of Representatives for consideration.

According to USAToday, Colorado now joins seven other states that have enacted similar laws to prevent credit report discrimination against job seekers.

Denver bankruptcy lawyers have seen time and again how unemployment sparked by our nation’s economic downturn has devastated families and destroyed, literally, millions of personal credit scores. As reported in the Coloradoan, credit scores drop for numerous reasons, including unemployment. But even for those who have managed to cling to their jobs, factors ranging from medical emergencies to identity theft to divorce and single parenthood — each of these factors can and do contribute to personal financial crisis and, ultimately, the tanking of personal credit rating.

Forbes offers the following tips for job seekers wanting to improve their credit standing:
~ check your credit score (federal law entitles you to an annual free credit report),
~ pay your bills on time,
~ reduce your debt, and
~ manage your credit card(s) responsibly (note: NOT having a credit card can be as bad as abusing one).

Colorado Bankruptcy Attorney Jon B. Clarke have represented clients throughout Colorado and the Denver Metro area for more than 30 years. If you are dealing with bankruptcy or debt-related issues in Colorado, call (303) 779-0600 to schedule a free consultation today.

Soaring Gas Prices Push Families to Seek Colorado Debt Relief

Despite reaching a four-year low in unemployment claim filings, Bloomberg.com reports that thanks to a 17 percent jump in gasoline prices since January, consumer confidence is again taking a hit. Denver bankruptcy attorneys, like the rest of the nation, have been watching with dismay as gas prices continue to climb up, and up, and up.

Colorado debt-relief lawyers know that for those folks trying to curb spending to help make ends meet, transportation costs often give up the least wiggle room. Kids have to get to school and parents have to get to work, to the grocery, to the bank and so forth. For families struggling to stave off a Denver bankruptcy filing, the fact that gas prices across the nation have clicked upward for eight days straight does little to improve personal finances.

CNN Money reports that Colorado drivers are currently paying about $3.56 a gallon for gas. Thankfully, those prices are on the low end of the national average. As of this post, Wyoming drivers are enjoying the lowest gas prices at $3.40 a gallon as Hawaii drivers are paying out a whopping $4.48.

With that said, it isn’t just the spike in prices, but the amount of income spent to keep tanks full that paints a clearer  image of how gas prices are impacting families. Across Colorado, residents are outlaying 5.4 percent of their income in fuel costs. In contrast, gas prices are gobbling up 11.8 percent of income for Mississippi residents, 10.6 percent for Montana drivers, and 10.0 and 9.9 percent in North and South Dakota, respectively.

Matching soaring gas prices with wobbly consumer confidence and a still-high unemployment rate means that for far too many Colorado families, preventing a personal financial crisis is just not possible. In many cases the economy simply isn’t improving fast enough as bills continue to pile up.

The debt-relief attorneys at the Law Office of Jon B. Clarke bring more than 30 years experience helping clients obtain a fresh start with mortgages, car loans, personal guaranty, credit card debt or other debt relief. To schedule a free consultation today, call (303) 779-0600.

Stopping Repossessions

We live in a society that focuses on material wealth, and as a result, we become very attached to the things that we own. But some of those things we become attached to because we need them in order to have a decent life, like a car and a home.

When someone threatens to take those things away from us, it’s upsetting because it can really affect our lives. And not just our lives, either, but our emotional wellbeing.

During turbulent times, people need stability in their lives in order to carry on, and having the threat of repossession hanging over your head takes away that safety even in the comfort of your own home.

The anxiety and stress caused by that lack of safety can affect every aspect of your life, and most importantly it can take away all of the joy you have.

If you live in constant fear of collections or repossessions, you should consider filing for bankruptcy. When you file for bankruptcy, the court issues an automatic stay on all types of collections and collection attempts.

That means that during the bankruptcy process, you no longer need to worry about your property. Even after the bankruptcy is over, chances are very good that your debts will either be cleared, or be taken down to a manageable level.

Using a good bankruptcy lawyer is the best way to do that, because the better your advocate during the bankruptcy process, the more rewards you’ll be able to reap!

Bankruptcy Misconceptions

Many misconceptions have been propagated about bankruptcy in both film and television, as well as by word of mouth.

The first mistake is that people look at bankruptcy as some sort of failure, or something to be ashamed of. As if filing for bankruptcy was a public admission of defeat. The fact of the matter is that you can fail all on your own without filing for bankruptcy, and actually taking the step of filing isn’t a sign of failure, but a sign that you’re taking control of your life back and you’re making the first step toward financial recovery.

But there are plenty of other misconceptions, such as that you’ll lose everything. In fact, bankruptcy has built-in protections, and it exists to help you, the consumer. In all likelihood, you’ll be able to keep both your home and your vehicle.

Some people think that bankruptcy will make them lose their retirement funds. In fact, bankruptcy can protect your retirement funds so that you can actually enjoy your retirement on schedule.

Some people think that bankruptcy will ruin your credit forever, and that they won’t be able to recover. Honestly, by the time most people consider filing for bankruptcy their credit is already ruined. Bankruptcy is the best way to help recover from a bad credit score.

While it may be hard to get a loan for a while after your bankruptcy, creditors like to see people who have had a successful bankruptcy and have turned their finances around. After some time elapses so that you can prove yourself, creditors will be very happy to give you loans because you’ll be a much safer investment!

So call a bankruptcy attorney today, and get started!

Loans vs. Bankruptcy

When major bills stack up, especially after life changing catastrophic events or major injuries and illness, it may seem like a good idea to turn to loans to cover immediate living expenses or to pay off large bills. Bankruptcy has a very negative stigma, and many people rightfully want to avoid filing. The problem may actually get worse by taking out loans. Many people assume they can afford another monthly payment, and do swing the extra burden for a few months or a year. The problem often becomes unbarable when another major event, injury or illness happens. Before you know it, you could find yourself in a financial tail spin you cannot repair.

Loan agreements, including those to consolidate debt, may just provide a band-aid to a bigger problem. Before you consider any loan, you should consider these points to see if it’s really a wise decision:

Your Monthly Budget

How thin have you stretched your monthly budget? Will taking out a loan strain your finances even more? If you find yourself worrying over how you will pay your day-to-day bills, adding more debt is never a good idea. If you have a significant portion of your monthly income left each month after paying your living costs, and a nest egg in savings, then you likely can negotiate with your debtors to make payments direct. If this is possible, be sure to get all payment arrangements in writing.

Before you sign any loan paperwork, find out exactly how much your monthly payments will cost. Check your household budget carefully, and be sure you ca afford the burden of the extra bill. If your budget can’t handle it, or you will be depriving yourself of a safety net, it is probably time to consider bankruptcy.

Explore Your Options

Talking to an experienced Colorado bankruptcy attorney is a safe way to explore your options and come up with the best possible plan to recover from devastating financial problems. If a Colorado bankruptcy is the best option, find an attorney you can trust to handle the legwork for you.

Debt Collection and Bankruptcy

There are a number of debt collection questions you may have if you are considering bankruptcy. Some of the most commonly seen questions involve the way that creditors deal with debts and the way that they may attempt to collect on them.

One of the most commonly asked questions is why a person may owe money to a creditor they don’t even recognize. This happens because most of the larger creditors won’t usually even try to sue you for what you owe them. They’ll sell or they will reassign your debt to a smaller collections agency. Those companies often try to collect debts that they don’t even have a right to enforce, so if you are dealing with an aggressive collector, it may be a good idea to have the case looked at by a lawyer.

Another issue that often arises is what to do if it goes to court. Usually in matters of debt collection if you don’t appear or you don’t file, the court will then issue a default judgment against you. What this means is that the judge states that you have lost the suit. The debt collector can then repossess your property in order to collect on the debt. If this happens, the creditor then has a number of options and they will attempt to use them. More often than not they will attempt to garnish your wages and this means that they will take around 25% of your pay until the debt is paid off. However, they will also add in accrued interest, attorneys fees and other things to make this number greater. Another method, and one that you should contact an attorney about right away is bank seizure. This is where they simply take money from your bank account. If this happens, you most likely do have options for getting that money back.

If you receive a summons with a blank answer form, you need to take that form to the court and pay a filing fee. However, before you do fill this out, you will want to talk to a lawyer because the debt companies will often use that answer against you if it’s not prepared correctly. The benefit of actually filing that answer is that the debt collector will sometimes stop the lawsuit. Mostly, their goal is in collecting the most they can with as little effort as possible. Going to court does not make that possible for them. Also, if you intend to file bankruptcy, that answer will give you some time to go ahead and do that, or even negotiate a debt settlement.

How to Begin With a Bankruptcy

Bankruptcy has become something that can be very complicated upon first glance. When you’re considering bankruptcy you may find some terms and things that make it seem that it is very time consuming. It can be a little bit, but it’s also important to note that when you have someone on your side to help, you can find your way through and get the new beginning you need. All it takes is making that first step.

There are first a few things that you should have in order to begin your case. Having this information on hand will help to not only better asses your situation but also to help get things moving in a much more efficient way. Any bankruptcy attorney you see will need to know this information, so having it from the start can be a big help. Filling out a bankruptcy intake questionnaire is normal. You will need to fill this out as completely as possible with the information requested. Also, copies of your pay. Whatever record keeping you have for every wage earner in your household will need to have this information together and this needs to be for not only the current month but for the six months previous to it. You’ll also need last year’s tax return, your most recent credit counseling certificate, and if you can, get your credit report from each of the credit reporting bureaus. Those are the basics, and a more full listing of what is needed can be found here.

You can usually either bring this in with you, or you can fax it, which ever you feel more comfortable with. However, having that information in the office ahead of time often helps a great deal. Understanding which assets you need to report can seem a little tricky but if you have questions there is plenty of information around the site to help, and you can always ask.

If it relates to your finances, having it all together neatly and ready to go through can be a huge help in moving your case along in a much more efficient way. This is the easiest way to make sure that you are able to get things going with the least amount of hassle. From there, your attorney will help you to understand everything that will need to happen and then, what you will need to do to get things moving and have your case filed and under way.

Bankruptcy and Student Loan Debt

Most people do not realize that there are certain types of debts that cannot be discharged via bankruptcy. If you’re in doubt, you may want to have an analysis done so that you can see if filing for bankruptcy is right for you. Talking to a bankruptcy attorney can also help you to know which debts you have will be relieved.

However, recently in the US, there has been a strong spike in student loan debt. According to USA Today, this monumental debt now totals roughly 850 billion dollars and well outstraps all total credit card debt. The site publisher from where this information orginates is Mark Kantrowitz, and he publishes two scholarship matching services. These are known as FastWeb.com and also FinAid.org.

The crux of the issue appears to be not so much the total debt, but the amount that most borrowers have to repay each month. On a $30,000 student loan, the interest rate may be payable at about 6.8 percent interest for ten years. This makes a $350 monthly payment. Most people don’t realize when they first enroll that something like that would necessitate earnings of around $42k a year.

You often see student loan debt come up as an issue in bankruptcy practice because of this. The fact is, most students will accrue more than $100k in student loan debt, and this means payments of over a thousand dollars a month. With the economy being what it is these days, couple that with other economic hardships and the high number of bankruptcy cases being seen, it’s no wonder people have difficulties.

There are certain cases where student loan debt may be discharged. These are known as “undue hardship” cases, or in some states, “extreme hardship”. The latter is a better way of phrasing it because it is usually very difficult to obtain this discharge. This will typically involve someone who has become medically incapable of working and in those cases alone. Unfortunately, these cases are extremely rare, and thus far, no one has been able to obtain a discharge on the basis of simply not being able to find a job that enables them to support themselves while also repaying those loans.

Now, of course, this is problematic but it does not mean that bankruptcy is not a good option in these cases. If you do find yourself in an overwhelming amount of debt, including student loans, the debts that can be discharged via bankruptcy, or even put on a repayment plan you can work with can help you to be able to repay those student loans that much faster.

Avoiding Mortgage Assistance Relief Scams

The economy has unfortunately provided an opportunity for scam artists to prey on homeowners struggling to keep their homes. So-called “foreclosure-prevention” companies claim to help homeowners obtain loan modifications that will lower their mortgage payments. Often these companies claim to be affiliated with attorneys, the government or real-estate experts. Homeowners who buy into their promises of “mortgage relief” end up paying hundreds or thousands for services the companies never deliver, and they still end up losing their homes.

To protect homeowners, the Federal Trade Commission (FTC) created the Mortgage Assistance Relief Services (MARS) Rule, which prohibits companies from collecting fees from a homeowner until the homeowner receives and accepts an offer of relief from his or her lender. Under this rule, a homeowner doesn’t have to pay a dime to a company until they get what the company promises to deliver.

Representatives of foreclosure-prevention companies scour Internet and newspaper foreclosure notices  or public files at government offices to find their unsuspecting targets. Some send personalized postcards or letters to homeowners, others advertise their services through radio, TV or newspaper ads, fliers, business cards or going door-to-door. Here are some red flags to watch out for if you are ever solicited by someone claiming to help save your home from foreclosure:

• The company guarantees they can stop foreclosure or get a loan modification regardless of your situation.
• The company tells you not to contact your lender, lawyer, or credit counselor;
• The company claims that most or all of its clients get mortgage relief or loan modification;
• You’re required to pay make an upfront payment before they will provide services;
• They only accept payments in a wire transfer or cashier’s check;
• The company tries to convince you to lease your house so you can buy it back over time;
• You’re instructed to make mortgage payments to the company instead of the lender;
• You’re asked to transfer your property title or deed or title to the company;
• The company offers to buy your house for cash  at a significantly lower price than what houses in your neighborhood sell for; or
• You’re pressured to sign papers you haven’t had a chance to thoroughly review or that you don’t understand.

Payday Loans

If you think a payday loan will ease your financial burden, think again. Used wisely, a payday loan can mean the difference between getting evicted from your home or keeping your roof over your head. Abuse them and you may find yourself considering calling a bankruptcy attorney.  Anyone can get a payday loan regardless of credit. All you need is a stable job and a checking account.

Most people obtain payday loans either through an Internet-based company–many of which are not based overseas, or a storefront company that offers payday or check-advance loans. With a storefront company, the borrower writes a personal check payable to the lender for the requested loan amount plus loan fees. The lender gives the borrower cash equaling the check amount minus loan fees. The  lender agrees to hold the check until a specified maturity date, which is usually the borrower’s next pay day.

Internet payday companies, with the borrower’s consent, electronically deposits the requested loan amount–minus loan fees–into the borrower’s checking account. Loan payments are debited from the borrower’s checking account on their next payday.

If you don’t pay the entire loan amount when it comes due, you can extend or “roll over” the loan to your next payday for a fee for every $50 or $100 borrowed. Here is where many borrowers start falling into the “payday loan trap”. If it takes you months to pay off a loan, you could end up paying more than you borrowed.

If you take out a $300 payday loan with a $25 loan fee, and roll it over for three months before you can pay it off, you end up paying the loan principal of $300 plus $150 or more in rollover fees depending on the interest rate (based on 2 paydays per month @ 3 months = 6 paydays x $25). The longer you  roll over the loan, the more you end up paying. Payday lenders are known for charging over 200% or more in interest on these loans.

Many people get in over their heads with payday loans when they continue borrowing one loan after another and/or borrow from multiple lenders to try stay afloat. A lot of bankruptcy filers list payday loans in their debts. Unlike debt collectors and creditors, who try to work with you to make suitable payment arrangments, payday lenders are typically unwilling to make payment arrangements and refuse any other payment method than electronic debits from your checking account. In addition, they tend to resort to illegal collection tactics like illegally garnishing borrowers’ wages or discussing and/or divulging information about your debt with parties other than you.

Payday loans aren’t worth the potential hassles. You’re better off getting a small personal loan from a bank or credit union, working out arrangements with your creditors, or seeking assistance from a consumer credit counseling to manage your debt. If you must take out a payday loan, only borrow what you can pay back by your next payday, and don’t become a habitual borrower of these types of loans.

Commonly Used Terms in Bankruptcy Law

If you are swamped by a debt and worried about your financial future, you should contact an experienced Colorado bankruptcy attorney to discuss your options. The idea of filing for bankruptcy can be intimidating, but a Chapter 7 or Chapter 11 filing can provide debt relief. Attorneys with experience in debt relief, bankruptcy and financial law can also provide other alternatives to a bankruptcy filing such as negotiating with creditors, selling assets and creating repayment plans.

One of the things that can be confusing for many individuals when it comes to debt relief is the terminology used by bankruptcy attorneys and other debt relief agencies. Here are some of the most commonly used financial terms related to debts.

• Lien: A lien is a charge on property in order to satisfy debt owed by the owner of said property, such as a debt related to a vehicle. In a car loan, the creditor has a lien on the vehicle.
• Secured Debt: Any debt that a creditor has taken a lien on.
• Unsecured Debt: Any type of debt that is not tied to a property.
• Dischargeable Debt: Bankruptcy “discharges” debts, so debts that are considered dischargeable are debts that can be cleared by a bankruptcy filing.
• Non-dischargeable Debt: These are debts that cannot be discharged or erased by filing for bankruptcy.
• Liquidation: The selling of assets to provide funds for paying off creditors. A Chapter 7 filing is often called liquidation bankruptcy.
• Reorganization: A plan for reorganization of a business’ assets and debts during Chapter 11 bankruptcy.
• Bankruptcy Reform Act: This act, named the Bankruptcy Abuse Prevention & Consumer Protection Act (BAPCPA), was signed into law by President Bush on April 20^th, 2005 and went into effect in October of 2005. The BAPCPA provides lawyers and debt relief agencies with strict guidelines for determining the eligibility of consumers for debt help as well as sets rules for bankruptcy filings.

If you are considering filing for bankruptcy or seeking other forms of legal debt relief, contact a Colorado bankruptcy attorney today.

The Different Types of Bankruptcy Filing

If you find yourself swimming in debt and are looking for a way to get out of a tough financial situation, you need the help of an experienced Colorado bankruptcy attorney. There are many different options for discharging business or personal debt with the help of an attorney, including but not limited to filing for bankruptcy with Colorado court.

Before contacting a lawyer for debt relief, it can be helpful to understand a bit about the different types of bankruptcy filings available to individuals and businesses. Individuals can file for three different types of bankruptcy:

• Chapter 7 is also called liquidation bankruptcy because this kind of filing requires that individuals liquidate their assets in order to pay debts.
• Chapter 13 bankruptcy is for individuals who want to retain control of some of their assets while liquidating others, and Chapter 13 often involves repayment plans on certain debts.
• Chapter 11 is the type of bankruptcy filing recommended for individuals with high incomes or assets, and it involves a trustee, a bankruptcy attorney and the debtor working together to discharge debts and liquidate assets.

Businesses can also file for Chapter 11 bankruptcy, and farm owners have a special type of filing called Chapter 12. Chapter 11 business bankruptcy is also called a reorganization plan, and the debts and assets of the business are reorganized so that creditors can be paid off and debts discharged. This kind of business filing requires the business owner, their lawyer and a Trustee appointed by the court to come up with a plan to reorganize the business and negotiate with creditors.

Under the 2005 Bankruptcy Reform Act, most businesses have a time limit in which to submit a reorganization plan to the US Bankruptcy Trustee. A Colorado bankruptcy attorney is essential for businesses in drafting this plan. Because of these new bankruptcy laws, individuals should also contact an attorney for help with their debt. Even if an individual does not qualify for Chapter 7 or Chapter 13 bankruptcy, there are alternatives that a Colorado bankruptcy attorney can provide for legal debt relief.

About the 2005 Bankruptcy Abuse Prevention & Consumer Protection Act

Former President George Bush signed a very important law into effect in April 20^th, 2005: The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) or simply the Bankruptcy Reform Act. This act affects every state in the nation, including Colorado, and a Colorado bankruptcy attorney will be able to explain how these new financial laws affect your debt situation. If you are facing serious debt, whether for your business or your personal finances, you need to contact an attorney who specializes in debt relief and financial law.

While filing for bankruptcy can seem intimidating, especially with the BAPCPA in effect, these laws are intended to protect debtors and provide legal steps for debt relief. Some of the changes to bankruptcy and debt relief law that the Bankruptcy Reform Act implemented include:

• a Means Test that determines whether a debtor can file Chapter 7 or Chapter 13
• new credit counseling procedures before filing
• an enhanced intake process for all debtors seeking legal help for their debt
• financial education for debtors before debt relief proceedings can beging
• more government oversight in business bankruptcy or Chapter 11 cases
• random audits of legal bankruptcy paperwork to ensure compliance with the law

The most important aspect of the Bankruptcy Reform Act is the way it categorizes debtors who are seeking relief from a legal debt relief agency such as a bankruptcy lawyer or debt relief agency. Under the BAPCPA, debtors are called assisted persons when they qualify for legal debt relief such as bankruptcy or liquidation.

To become an assisted person, the individual or business debtor must have unprotected assets of less than $150,000 in value and primarily consumer debt. If you are curious if you qualify as an assisted person, please contact an experienced Colorado bankruptcy attorney.

A lawyer will let you take a Means Test and complete a thorough intake process to determine your eligibility. Using the financial information you provide in your intake forms, an attorney will be able to analyze your debt situation and advise you on the best way to discharge your debt in accordance with US and Colorado financial law.

What is a Debt Workout Agreement?

When families, high-income individuals or businesses are facing mounting debt, it can be a hard thing to contemplate filing for Chapter 7, Chapter 11 or Chapter 13 bankruptcy. Individuals can be confused about what bankruptcy can mean for their family’s financial future, and business owners can be afraid that they might have to close their doors due to business debt. However, an experienced Colorado bankruptcy attorney can help both individual debtors and business debtors explore their options when it comes to debt relief. Many people will hesitate to contact an attorney for debt relief advice because they are under the false assumption that an attorney can only help with filing for bankruptcy, but one of the ways that an attorney can help debtors avoid bankruptcy is by crafting a debt workout agreement.

A debt workout agreement is one of the legal alternatives to a bankruptcy filing available with the help of a bankruptcy attorney. In a debt workout agreement, an attorney negotiates with creditors to work out a plan for payments that will allow the debtor to retain assets while they slowly pay off their debt. These agreements can ensure that an individual can keep assets that might be taken by a creditor without the help of an attorney, and they can also give struggling businesses time to grow and make a profit in order to pay off debts and continue to operate. A debt workout agreement can help families and businesses avoid filing for bankruptcy while also providing debt relief.

A debt workout agreement can also benefit creditors. With such an agreement, the creditor knows that they will be receiving some money in the short term and a steady payment in the long term instead of having to wait months or even years for bankruptcy proceedings to conclude. Often, the simple fact that a debtor has enlisted the help of an attorney will work in their favor with creditors or collection agencies because creditors know that an individual is serious about addressing their debt. If your business or family is burdened with a large debt, you should contact a Colorado bankruptcy attorney to discuss your debt relief options.

U.S. Government discusses plans for refinancing mortgages to relieve debt

The economy has been more than just the topic of the day, the week, the month, the year; the economic struggle felt by the government, businesses and individuals across the nation has been a serious stressor. Everyone is scrambling to find ways to relieve debt and look for alternatives to filing for bankruptcy.

One of the major problems during the recessed economy has been the real-estate market. The number of homeowners with upside-down mortgages is at a record high, and according to government resources, something that they need to fix in order to spur a boost in the overall economy.

There are rumors that the Obama administration has been considering a new plan that would help a greater number of homeowners with government-backed properties reduce the interest rate on their mortgage to a rate of about 4 percent. Because there is only discussion, the details of the proposed plan remain unknown, for example who would be eligible, would it include mortgages that are already in default?

A broad sweeping refinancing plan seems appealing to many economists because it allegedly would not increase the national deficit but would help reduce the $700 billion homeowners across the country owe above the value of their home.

If you are someone who is struggling to make their mortgage payments and want to take advantage of programs like the one that could be offered here, the best option is to talk to an attorney who can help you determine eligibility and what plan of action would be best for you and your financial future.

Source: The New York Times, “U.S. May Back Refinance Plan for Mortgages,” Shaila Dewan and Louise Story, Aug. 24, 2011

Colorado Forest Service works with sawmills to save timber industry

When a business fails to make a profit because consumers are not purchasing, we are not surprised when we hear that they are struggling to stay open. What about industries that do not rely solely on production and sales? Some industries rely on contracts that they bid upon and purchased. The businesses are obligated to remain in the contract and follow the terms.

The Colorado sawmill industry is filled with corporations that purchased timber contracts in 2000 when the economy was steady, stable and even booming. Many are now facing bankruptcy but looking for alternatives to filing. When the economy began to struggle and the timber market fell with it, the contracts simply became less than economically viable but the terms and conditions remained strict.

According to the Colorado Forest Service, default on the contracts could lead to serious consequences for the state of Colorado. The bark beetle epidemic has been coursing through the Rocky Mountain Region, killing trees and causing hazardous problems in the ecosystem. If the mills are forced to close, Colorado will not be able to keep up with the epidemic.

Representatives of the Forest Service announced this month that some of Colorado’s sawmills would be eligible for a mutual cancellation of contracts that are a serious financial liability.

“The forest product industry is struggling to stay in business,” said the acting Rocky Mountain Regional Forester. “Dead tress and trees at risk of beetle infestation across millions of acres in the Rocky Mountain Region pose risks to public safety, watersheds, critical infrastructure and create severe wildfire hazards…Ensuring a viable forest products industry is in the best interest of the Forest Service and the public.”

Representatives of the Forest Service announced this month that some of Colorado’s sawmills would be eligible for a mutual cancellation of contracts that are a serious financial liability. The plan is to review eligibility on a case-by-case basis, and those who cancel will not be penalized but will remain eligible to bid on future timber sales contracts.

Source: Summit County Voice, “Colorado’s struggling sawmills get some relief,” Bob Berwyn, Aug. 5, 2011