Phoenix Bankruptcy Attorney Blog | Arizona Chapter 7 Lawyer | Tucson Debt Relief Law Firm tag:www.maricopacountybankruptcyattorney.com,2009-12-03:/2421 2012-02-22T22:37:13Z Legal blog shares news about Maricopa County bankruptcy topics, such as Chapter 7, Chapter 13, debt relief, medical debt and foreclosure alternatives. Movable Type Enterprise 4.32-en Study examines impact of CARD Act disclosures tag:www.maricopacountybankruptcyattorney.com,2012://2421.206458 2012-02-22T22:35:24Z 2012-02-22T22:37:13Z In the past, you probably felt as if your credit card statement was virtually indecipherable. Specifically, you may have taken once glance at the extremely small print, complicated legal language and multitude of figures, and simply cast it aside in... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 In the past, you probably felt as if your credit card statement was virtually indecipherable. Specifically, you may have taken once glance at the extremely small print, complicated legal language and multitude of figures, and simply cast it aside in frustration.

However, you've probably noticed some changes to your credit card statement over the last year, including more detailed information on how much you would have to pay per month to eliminate your debt in three years and how long it would take to eliminate your debt if you made only the minimum monthly payments. These disclosures were mandated by Congress as part of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act, a measure designed to introduce debt relief for consumers by giving them a concise summary of their debt.

Interestingly, researchers from the respective business schools of NYU, Harvard and Oxford have been conducting an ongoing study designed to determine how effective these new mandated disclosures -- particularly as they relate to minimum monthly payments and the three-year payment schedule -- have been in changing consumer habits.

]]> To accomplish this, they studied the payment habits of 30,000 credit card customers of a mid-sized credit union in Minnesota.

Interestingly, they determined that the disclosure requirement concerning minimum monthly payments actually resulted in more consumers changing their habits (i.e., paying more than the required monthly minimum toward their credit card balance). In addition, they found that some consumers elected to make payments in accordance with the disclosure outlining the three-year payment schedule.

However, the researchers determined that those consumers making payments under the three-year payment schedule weren't necessarily getting out of debt. Specifically, the disclosure concerning how much it would take to pay off their credit card debt in three years changed with every statement once a payment was made.

Consequently, the three-year payment schedule is something a moving target and the unwitting consumer may actually take far more than three years to pay it off.

Accordingly, the researchers have determined through their preliminary findings that the language of the disclosure concerning the three year payment schedule needs to be amended.

"Generally, more disclosure is a good thing," said Professor Claudine Gartenberg of NYU. "It just has to be done in a way that doesn't lead people astray."

Stay tuned for more from our Phoenix bankruptcy blog ...

Whatever the cause, whatever the reasons behind your financial difficulties, take the time to speak with an experienced legal or financial professional if you would like to learn more about Chapter 7 bankruptcy, Chapter 13 bankruptcy or additional debt relief options.

The following post is for informational purposes only and is not to be construed as legal advice.

Source:

The New York Times, "Disclosures are found to change financial behavior" Feb. 22, 2012

]]> Phoenix bankruptcy filings down to lowest level since 2009 tag:www.maricopacountybankruptcyattorney.com,2012://2421.202082 2012-02-18T22:35:03Z 2012-02-15T22:37:39Z According to the U.S. Bankruptcy Court in Phoenix, there were just 1,795 bankruptcy filings in Arizona in January of this year -- the lowest number of filings in the state since January of 2009. In the past 12-month period, the... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 According to the U.S. Bankruptcy Court in Phoenix, there were just 1,795 bankruptcy filings in Arizona in January of this year -- the lowest number of filings in the state since January of 2009. In the past 12-month period, the city of Phoenix saw a reduction in filings of over 33 percent, compared to 14 percent nationwide.

Unemployment is one of the key reasons for filing bankruptcy. As the economy perks up a bit and the unemployment rate declines, fewer people file for bankruptcy. However, despite the fact that many Arizonan's are currently employed, one in three have little to no savings. Thus, there is nothing to fall back on if a job is lost.

Typically, people who have been able to save money or assets sufficient to cover three months of their expenses can survive a brief period of unemployment. If, however, someone is living from hand to mouth, even a week without pay can be devastating. Once they get behind, it is very hard to get caught up, especially if the only jobs available pay less than those lost.

]]> Consumer debt -- most commonly, credit card charges -- is also linked to bankruptcy filings, but on a lagging basis. When they find themselves in a financial bind, people typically make the minimum payments on their credit cards, delaying paying off the balance until a later date that may never arrive.

Consumer debt levels, after declining over the past three years, are starting to come up again. Some see this as a sign of the economy recovering but bankruptcy experts feel otherwise. They predict that the number of people seeking protection through bankruptcy will again rise as household spending increases.

Spending Tips

  • Don't spend like there is no tomorrow.
  • Do save enough to cover three months of your expenses - six months worth, if possible.
  • Don't buy a new car just because you can afford to.
  • Do pay off credit cards in full each month - if you can't, quit using them.

Despite doing everything right, many people still need bankruptcy protection. There is no shame. It is just a sign of these hard economic times.

Source: AZcentral.com, "Bankruptcy filings decline in Phoenix," Russ Wiles, February 7, 2012

]]> Mortgage settlement also addresses harm to armed forces personnel tag:www.maricopacountybankruptcyattorney.com,2012://2421.202102 2012-02-15T22:28:25Z 2012-02-15T22:30:11Z Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 In our last few posts, we have been discussing the historic $25 billion settlement agreement between the attorneys general of more than 40 states and the five major banks (Wells Fargo, JPMorgan Chase & Co., Bank of America, Ally Financial and Citigroup) concerning widespread abuses in the mortgage industry and fraudulent foreclosure practices.

Interestingly, there is another component of the settlement that is now generating a significant buzz across the country: relief for active duty and deploying armed forces personnel whose lenders violated federal laws prohibiting mortgage abuses among service members.

According to federal officials, those military members who lost their homes due to deceptive foreclosure tactics or who were otherwise denied interest rate reductions on their homes will be eligible for some measure of relief.

Specifically, Ally Financial, Citigroup and Wells Fargo are required under the terms of the settlement to provide every service member who was victimized by wrongful foreclosure with a minimum of $116,785, as well as interest and lost equity.

JPMorgan Chase has already provided some measure of financial compensation to many victimized service members under the terms of a private settlement. However, they will also be required to provide affected service members with the return of their homes (free and clear of debt) or their cash equivalent at the time of the sale, as well as additional compensation for "any additional harm suffered."

]]> Tom Perez, the assistant attorney general for the Justice Department's civil rights division offered a concise explanation of the legal protections offered to military members under federal law at a recent press conference.

"The law postpones, suspends, terminates or reduces the amount of certain consumer debt obligations so that members of the armed forces can focus their full attention on their military responsibilities without adverse consequences for themselves or their families," he said. "Among these protections is a prohibition on foreclosure of a service member's property without first getting approval from the court, if the service member received the mortgage loan prior to entering military service. And if a foreclosure is filed in court, it requires the servicer to notify the court that a service member is on active duty."

It is worth noting that the settlement dictates that this relief/protection will not only be provided to military members who took out their mortgages before joining the service, but also to those who took out their mortgages after joining.

Finally, the assembled officials at the press conference indicated that the government will identify and notify all eligible service members over the course of time, and that they do not have to apply for relief.

Stay tuned for further developments from our Phoenix bankruptcy blog ...

If you are facing foreclosure, you should strongly consider contacting an experienced bankruptcy attorney to learn more about your rights and your options under Chapter 13 bankruptcy.

This post is for informational purposes only and is not to be construed as legal advice.

Source:

The New York Times, "Mortgage relief for service members" Feb. 12, 2012

]]> Update: Arizona signs $25 billion foreclosure deal tag:www.maricopacountybankruptcyattorney.com,2012://2421.200442 2012-02-13T19:08:18Z 2012-02-13T19:13:29Z Last week, the states and the five major banks finally reached a settlement agreement concerning widespread abuses in the mortgage industry and fraudulent foreclosure practices. According to reports, the attorneys general of more than 40 states and the banks implicated... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 Last week, the states and the five major banks finally reached a settlement agreement concerning widespread abuses in the mortgage industry and fraudulent foreclosure practices.

According to reports, the attorneys general of more than 40 states and the banks implicated in the scandal -- Wells Fargo, JPMorgan Chase & Co., Bank of America, Ally Financial and Citigroup -- reached a settlement of at least $25 billion.

The settlement thus far calls for the following conditions:

  • $17 billion to provide mortgage relief for over 1 million U.S. homeowners
  • $3 billion for mortgage servicers to help U.S. homeowners refinance into lower-interest mortgages
  • $1 billion to the federal government
  • Payments -- rumored to be between $1,500 to $2,000 -- to hundreds of thousands of homeowners who have already fallen victim to fraudulent foreclosure practices between 2008 and 2011

The $25 billion settlement represents the culmination of a 16-month investigation by state attorneys general into whether the aforementioned banks relied upon faulty procedures (i.e., improper document review, falsified signatures and use of "robo-signers") to foreclosure upon thousands of homes.

Reports indicate that the attorneys general agreed to extend more protection against future legal claims to the banks implicated in the scandal. However, it should be noted that the settlement does not prevent unhappy homeowners from suing individually or as part of a class action suit.

]]> Arizona Attorney General Tom Horne signed off on the terms of the $25 billion agreement only after reaching a separate $10 million settlement with Bank of America concerning a 2010 lawsuit the state filed over illegal foreclosure practices.

Here, if Horne had signed the foreclosure deal before reaching this settlement, the chance of recovery in the state courts would likely have been forfeited because of the partial immunity promised by the $25 billion agreement.

Interestingly, Arizona is currently set to receive up to $1.6 billion of the $25 billion settlement, the third biggest portion behind only California and Florida.

According to Horne's office, the majority of the money will likely be divided in the following fashion:

  • $1.3 billion to help qualifying homeowners whose homes are now worth far less than the amount of their mortgage (i.e., helping those Arizona residents with underwater mortgages)
  • $110 million for those homeowners who have already victim to fraudulent foreclosure practices between 2008 and 2011
  • $85 million toward interest-rate deductions for qualified homeowners

Stay tuned for further developments from our Phoenix bankruptcy blog ...

If you are facing foreclosure, you should strongly consider contacting an experienced bankruptcy attorney to learn more about your rights and your options under Chapter 13 bankruptcy.

This post is for informational purposes only and is not to be construed as legal advice.

Sources:

Arizona Daily Star, "Arizona to get $1.6B, 3rd-largest share of mortgage settlement" Feb. 10, 2012

USA Today, "Feds, states, banks agree to mortgage settlement" Feb. 10, 2012

]]> Law school graduates turn to bankruptcy, seek debt relief tag:www.maricopacountybankruptcyattorney.com,2012://2421.197088 2012-02-11T21:16:44Z 2012-02-06T21:19:52Z From the looks of it, gone are the days when students could go to law school expecting to land a cushy job upon graduating and passing the Bar Exam. In fact, it is no longer guaranteed that they will get... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 From the looks of it, gone are the days when students could go to law school expecting to land a cushy job upon graduating and passing the Bar Exam. In fact, it is no longer guaranteed that they will get a legal job straight out of law school. Due to layoffs and fewer entry-level openings for new lawyers, the job market for attorneys is tight, leading to lower median salaries and higher debt loads.

According to Reuters, law school students graduating with the median amount of law-school debt are unable to make ends meet if they make the median starting salary - $63,000 in 2010. The rising amount of debt graduates are left with after law school, along with an unstable job market, has caused some to turn to Chapter 7 personal bankruptcy protection. Average law-school debt increased 50 percent from 2001 to 2010, and lawyers' earning power is not keeping up.

]]> Bankruptcy law only allows discharge of student loan debt if the debtor can prove that repayment would create a "undue hardship," which is a very difficult standard to meet. Despite this difficulty, it appears that more graduates are filing for bankruptcy protection, even while overall consumer bankruptcies decreased by 11 percent in 2011.

Chapter 7 bankruptcy can provide relief to individuals, such as discharge of personal debt in some situations. By choosing to go to law school and take on student loans as a way to finance their legal education, law graduates will have a hard time convincing bankruptcy courts that their hardship is undue or unique - especially when there are so many new graduates facing similar circumstances.

Source: Reuters, "Law grads go to court for bankruptcy protection," Leigh Jones and Moira Herbst, February 3, 2012

]]> Arizona has not yet signed onto foreclosure deal tag:www.maricopacountybankruptcyattorney.com,2012://2421.198051 2012-02-08T20:53:50Z 2012-02-08T20:57:14Z As discussed in previous posts, the attorneys general of the 50 states and several major banks have been involved in settlement negotiations concerning widespread abuses in the mortgage industry and fraudulent foreclosure practices for well over a year. According to... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 As discussed in previous posts, the attorneys general of the 50 states and several major banks have been involved in settlement negotiations concerning widespread abuses in the mortgage industry and fraudulent foreclosure practices for well over a year.

According to news reports, these negotiations are now nearing an end as the attorneys general of more than 40 states and the banks implicated in the scandal -- Wells Fargo, JPMorgan Chase & Co., Bank of America, Ally Financial and Citigroup -- have reached a settlement that could be worth as much as $25 billion if all states agree to its terms.

Specifically, the prospective settlement calls for the following:

  • The banks would agree to lower the principal of qualifying homeowners whose homes are now worth far less than the amount of their mortgage (i.e., those Americans with underwater mortgages)
  • The banks would send payments -- rumored to be in the amount of $2,000 -- to homeowners who have already fallen victim to foreclosure

The $25 billion settlement represents the culmination of a 16-month investigation by state attorneys general into whether the aforementioned banks relied upon faulty procedures (i.e., improper document review, falsified signatures and use of "robo-signers") to foreclosure upon thousands of homes.

]]> Interestingly, Arizona Attorney General Tom Horne has not yet signed off on the terms of the settlement -- joining the ranks of states such as California, Delaware, and New York.

Here, a spokesperson for Attorney General Horne indicated that while he is leaning heavily toward agreeing to the terms of the settlement, he cannot do anything until an outstanding lawsuit against Bank of America is resolved.

However, the spokesperson did indicate that an official announcement on the matter should be coming in the next few days.

It is worth noting that even though Arizona missed Monday's deadline for agreeing to the settlement, it -- and the other holdout states -- will likely be permitted to join as the final details are worked out.

"Federal and state officials, as well as representatives from the banks, continue to address matters that they must complete before finalizing any settlement," said Iowa Attorney General Tom Miller, leader of the settlement negotiations, in a prepared statement.

Stay tuned for further developments from our Phoenix bankruptcy blog ...

If you are facing foreclosure, you should strongly consider contacting an experienced bankruptcy attorney to learn more about your rights and your options under Chapter 13 bankruptcy.

This post is for informational purposes only and is not to be construed as legal advice.

Source:

Arizona Capitol Times, "Arizona leaning toward joining $25 billion foreclosure settlement with banks" Feb. 8, 2012

]]> A closer look at the realities of strategic default tag:www.maricopacountybankruptcyattorney.com,2012://2421.197085 2012-02-06T21:12:38Z 2012-02-06T21:15:28Z Over the past few months, many publications have released stories discussing how the nation's real estate market is poised to make a recovery and has already made a slight recovery in some areas. While this may be somewhat true, the... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 Over the past few months, many publications have released stories discussing how the nation's real estate market is poised to make a recovery and has already made a slight recovery in some areas. While this may be somewhat true, the actual numbers paint a decidedly grimmer picture:

  • Corelogic -- a financial information network -- estimates that nearly 11 million homeowners are currently "underwater," meaning the amount they owe on their mortgage is far greater than the value of the home itself
  • RealtyTrac -- the online real estate network -- estimates that roughly 3.5 million homeowners are behind on their mortgage payments while another 1.5 million are already deep in the foreclosure process

In fact, many of these struggling homeowners are now opting to abandon their mortgage payments and simply walk away from their home, a phenomenon known as a "voluntary foreclosure" or "strategic default."

]]> While it's certainly clear why strategic default may seem like a feasible alternative for struggling homeowners, it is important to recognize that it may have certain adverse consequences, including:

  • Homeowners may see their credit scores take a rather steep drop for a few years before recovering, while higher interest rates may also be the norm for a few years
  • Homeowners may encounter difficulty securing a mortgage for several years after a strategic default/voluntary foreclosure.
  • Homeowners may still face deficiency judgments brought by lenders or be pursued by debt collection agencies (However, Arizona is a "non-recourse" state, meaning that mortgage lenders are unable to pursue homeowners for deficiency judgments.)

Fortunately, Chapter 13 bankruptcy can provide struggling homeowners with options during these difficult times.

Chapter 13 allows a homeowner to construct a three to five year repayment plan to pay off their mortgage arrears without paying interest. It also allows homeowners to discharge second or even third mortgages.

In closing, homeowners facing significant financial hurdles should strongly consider alternatives to strategic default/voluntary foreclosure. An experienced legal professional can answer any questions and, more importantly, explain these alternatives.

The following post is for informational purposes only and is not to be construed as legal advice.

Source:

Reuters, "What happens when you walk away from your home?" Jan. 27, 2012

]]> Eight tips for effective debt settlements tag:www.maricopacountybankruptcyattorney.com,2012://2421.193930 2012-02-03T19:58:47Z 2012-02-01T20:01:24Z While many people who have substantial debts choose to pursue a Chapter 7 or Chapter 13 bankruptcy filing to free themselves from the burden, sometimes a debt settlement plan is a more effective solution. According to Kristy Walsh -- founder... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 While many people who have substantial debts choose to pursue a Chapter 7 or Chapter 13 bankruptcy filing to free themselves from the burden, sometimes a debt settlement plan is a more effective solution.

According to Kristy Walsh -- founder of Creditinfocenter.com, a community-based source of financial information for the general public and author of several popular books on personal finance -- the process of settling a debt is one that needs to be done right in order to reach a positive resolution and stop creditor harassment at the source.

She offers an eight-step checklist to creating an effective debt settlement plan. Her tips are a combination of common sense and insider information, including:

  • Putting everything in writing, communicating with collection agencies solely through regular or electronic mail
  • Sending any documentation to the collection agency via registered U.S. mail to provide proof that the agency actually received your debt settlement offer
  • Offering no more than 25 percent of the total value of the debt as a settlement; Ms. Walsh recommends the 25 percent cap because debt collection agencies purchase debt from companies at pennies on the dollar and are likely to accept much less than the total value since they still turn a profit
]]>
  • Keeping communications moderate in tone, with no sense of urgency to settle the debt
  • Having all terms of the debt settlement plan in writing before any payments are made
  • Paying one lump sum to avoid interest charges; this also might avoid restarting the statute of limitations on an otherwise uncollectable debt
  • Record every interaction with the collection agency, including dates, times and manner of correspondence (phone, mail, etc.)
  • Sending a written request that the company remove negative information about the debt from your credit report

    • Stay tuned for further developments from our Phoenix bankruptcy blog ...

    The following post is for informational purposes only and is not to be construed as legal or financial advice.

    Source: Marketwire for Phoenix Arizona (via Comtex), "8 Good Rules of Thumb for Debt Settlement," Jan. 18, 2012

    ]]>     FTC: Collection agency must pay $2.5 million for violations of federal debt collection laws tag:www.maricopacountybankruptcyattorney.com,2012://2421.193929 2012-02-01T19:54:14Z 2012-02-01T19:56:52Z There is no doubt that dealing with debt collectors can prove to be a frightening experience. Their hostility may leave you feeling anxious, angry and even hopeless. In fact, some unscrupulous debt collectors may even lead you to believe that... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 There is no doubt that dealing with debt collectors can prove to be a frightening experience. Their hostility may leave you feeling anxious, angry and even hopeless. In fact, some unscrupulous debt collectors may even lead you to believe that you are somehow ineligible for securing any type of debt relief.

    Fortunately, this is simply not the case. You do have viable options for debt relief, including Chapter 7 bankruptcy and Chapter 13 bankruptcy. In addition, federal law protects you from creditor harassment via the Fair Debt Collection Practices Act (FDCPA). This valuable law prohibits debt collection agencies from using deceptive, abusive or unfair practices to collect debt.

    Interestingly, the Federal Trade Commission (FTC), the agency charged with enforcing the FDCPA, recently handed down the second largest civil penalty in its history against a debt collection agency it accused of using misleading tactics in its dealings with consumers.

    ]]> Asset Acceptance, headquartered in Warren, Michigan, and one of the major debt collection agencies here in the United States, agreed to pay $2.5 million dollars to the FTC.

    According to complaints received by the FTC, Asset Acceptance debt collectors allegedly neglected to alert consumers that their debts were too old to be sued for, failed to inform consumers that paying even a small amount on an old debt would revive it, conducted no investigations of disputed debts, and provided credit reporting agencies with erroneous information.

    In addition to the large fine, Asset Acceptance expressly agreed to alert consumers whose debts are too old that they will not be sued, provide consumers with a warning that it is reporting debt to a credit reporting agency, and investigate disputed debts, to name only a few.

    Over the last two years, the FTC has been cracking down on illegal actions by debt collection agencies, bringing eight separate legal actions and handing down its largest fine ever -- $2.8 million -- to West Asset Management back in March 2011.

    "Our attention to debt collection has increased over the past couple of years because the complaints have been on the rise," said J. Reilly Dolan, the assistant director of the FTC's financial practices division.

    Stay tuned for further developments from our Phoenix bankruptcy blog ...

    The following post is for informational purposes only and is not to be construed as legal advice.

    If you would like to learn more about debt relief or stopping creditor harassment, take the time to speak with an experienced legal professional.

    Source:

    The New York Times, "FTC fines a collector of debt $2.5 million" Jan. 30, 2012

    ]]>     Study: Credit bills remain popular choice for paying medical bills tag:www.maricopacountybankruptcyattorney.com,2012://2421.191427 2012-01-30T15:38:36Z 2012-01-30T15:42:05Z As discussed in previous posts, one of the main reasons why people often seek the fresh financial start offered by either Chapter 7 bankruptcy or Chapter 13 bankruptcy is the accumulation of significant medical debt -- typically caused by the... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 As discussed in previous posts, one of the main reasons why people often seek the fresh financial start offered by either Chapter 7 bankruptcy or Chapter 13 bankruptcy is the accumulation of significant medical debt -- typically caused by the onset of a sudden injury/illness or a debilitating disease/condition.

    In fact, a recent study conducted by non-profit organizations The Access Project and Demos determined that a high percentage of Americans -- up to 29 percent -- had some type of medical expenses as part of their credit card balance.

    ]]> Breaking the numbers down, The Access Project and Demos found the following:

    • On average, households with medical debt had credit card balances that were 46 percent higher than households without medical debt
    • Both uninsured and insured households with medical debt had relatively high credit card balances ($14,512 and $10,973, respectively)
    • Young adults (age 18 to 34) with medical debt were determined to be the age group with the highest average credit card debt, coming in at $13,303 (as compared with $7,450 for young adults without medical debt)
    • Households with medical debt were more likely to be contacted by debt collection agencies than those households without medical debt

    The researchers arrived at these eye-opening conclusions via a telephone survey of 1,150 lower- and middle-income households conducted back in 2005. Here, only those households that had credit card debt for at least three months were included in the survey.

    "The problem of medical debt is widespread," said Mark Rukavina of The Access Project and one of the authors of the study. "Nearly 60 million adults in the U.S. are at risk of incurring medical bills that they will not be able to afford. Many people are just an illness away from becoming medical debtors, and medical debt can have a detrimental effect on healthcare access."

    Some of the potential solutions offered by the authors include regulating the ability of medical providers to enter the financial services sector and distinguishing medical debt from consumer debt.

    Stay tuned for more from our Phoenix bankruptcy blog ...

    Whatever the cause, whatever the reasons behind your financial difficulties, take the time to speak with an experienced legal or financial professional if you would like to learn more about Chapter 7 bankruptcy, Chapter 13 bankruptcy or additional debt relief options.

    The following post is for informational purposes only and is not to be construed as legal advice.

    Source:

    MSN Health, "More Americans paying their medical bills with credit cards" Jan. 16, 2012

    ]]>     Sports super agent files for Chapter 7 tag:www.maricopacountybankruptcyattorney.com,2012://2421.190171 2012-01-28T21:36:00Z 2012-01-26T21:39:30Z Earlier this month, sports agent Leigh Steinberg -- known to many as the real life inspiration for the hit movie "Jerry Maguire" -- made headlines across both the sports world and the legal world when he filed for Chapter 7... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 Earlier this month, sports agent Leigh Steinberg -- known to many as the real life inspiration for the hit movie "Jerry Maguire" -- made headlines across both the sports world and the legal world when he filed for Chapter 7 bankruptcy in the U.S. Bankruptcy Court in Santa Ana, California.

    In his bankruptcy petition -- filed back on January 11 -- Steinberg cited anywhere from $1 million to $5 million in debts -- with the exact amount of his liabilities being determined at the first meeting of creditors. Curiously, he listed his only asset as $435,000 in stock.

    According to Steinberg's bankruptcy attorney, Alessandro Assanti, Steinberg's financial problems were caused by a multitude of factors, including:

    • The "serious medical issues" of his two children
    • A "forbidden" business transaction by a former employee who took an unauthorized $300,000 loan from a client-athlete back in 2003, and the legal battles this incident spawned
    • A battle with alcoholism that spanned several years (Steinberg has been sober since 2010)

    "So many terrible things were going on in his life personally, it was difficult to balance," said Assanti.

    ]]> For years, Steinberg has been at the forefront of some of the biggest contracts in professional football, earning the title of so-called "super agent." In fact, he has represented the first pick in the National Football League (NFL) draft at least six times over the last two decades.

    "If you were a top-tier player, especially a quarterback, then there was little debate over who you wanted your agent to be," said Stephen Cannella, a senior editor with Sports Illustrated. "Having him as representation almost became a status symbol for players coming out of college, a way of announcing yourself as a start before you had even signed a contract."

    In a statement released shortly after the filing, Steinberg explained why he had delayed filing for bankruptcy and why he was forced to do so now.

    "[I delayed filing for bankruptcy] because of my moral and legal obligation to people who advanced me funds or performed services in good faith. But the constant and aggressive collection efforts and press initiatives undertaken by creditors have harassed my family and prevented me from working to be able to pay these debts."

    For those unfamiliar with Chapter 7 bankruptcy, a bankruptcy trustee will collect and liquidate some of the debtor's assets. The income earned through this sale of assets will then be applied to unsecured debts and any remaining balance will be discharged.

    Stay tuned for further developments on this story from our Phoenix bankruptcy blog ...

    If you would like to learn more about how to eliminate debt and secure a fresh start via Chapter 7 bankruptcy or Chapter 13 bankruptcy, take the time to speak with an experienced legal or financial professional.

    The following post is for informational purposes only and is not to be construed as legal advice.

    Source:

    ABC News, "Inspiration for 'Jerry Maguire' files for bankruptcy" Jan. 12, 2012

    ]]>     ABI report shows Chapter 7, Chapter 13 filings fell in 2011 tag:www.maricopacountybankruptcyattorney.com,2012://2421.185803 2012-01-25T17:52:35Z 2012-01-30T15:36:18Z Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 A recent report from the American Bankruptcy Institute (ABI) revealed that the number of Americans who filed for bankruptcy (Chapter 7 bankruptcy, Chapter 11 bankruptcy and Chapter 13 bankruptcy) declined precipitously from calendar year 2010 to calendar year 2011 -- falling by as much as 12 percent.

    Citing figures from Epiq Systems, Inc., the ABI press release indicated that there were approximately 1,379,113 bankruptcy filings in the U.S. during calendar year 2011 as compared with 1,561,008 bankruptcy filings in calendar year 2010.

    In regard to consumer bankruptcy, the ABI report indicated that Chapter 7 bankruptcy filings declined by 13 percent in calendar year 2011 (965,423 Chapter 7 filings in 2011 v. 1,111,236 Chapter 7 filings in 2010), while Chapter 13 bankruptcy filings declined by eight percent in calendar year 2011 (401,588 Chapter 13 bankruptcy filings in 2011 v. 435,242 Chapter 13 bankruptcy filings in 2010).

    What was behind this fairly significant drop in bankruptcy rates?

    ]]> "The decline in total filings reflects the retrenchment in consumer spending associated with a down U.S. economy," said Samuel J. Gerdano, Executive Director of the ABI. "As consumers continue to deleverage their debt and access to credit remains tight, bankruptcy filings will continue to decrease."

    Interestingly, the ABI report also indicated that the five states with the highest per capita filing rate (i.e., total filings per 1,000 people) in calendar year 2011 were 1) Nevada (8.98), 2) Georgia (7.35), 3) Tennessee (7.34), 4) Utah (6.53), and 5) Alabama (6.37).

    For those who may not know the difference between Chapter 7 and Chapter 13, we offer the following brief explanation

    • In Chapter 7 bankruptcy, a bankruptcy trustee will collect and liquidate some of your assets. The income earned through this sale of assets will then be applied to your unsecured debts and any remaining balance will be discharged.
    • Chapter 13 bankruptcy is a viable option for those who want to repay their debts, but require some form of immediate relief from collections and/or additional late payment penalties and interest. In general, Chapter 13 accomplishes this by arranging a legal debt workout (i.e., 3-5 year repayment plan) that will be reviewed, approved, and managed by the bankruptcy court.

    If you would like to learn more about Chapter 7 bankruptcy or Chapter 13 bankruptcy, take the time to speak with an experienced legal or financial professional.

    Stay tuned for further developments from our Phoenix bankruptcy blog ...

    The following post is for informational purposes only and is not to be construed as legal advice.

    Source:

    American Bankruptcy Institute, "Total bankruptcy filings decrease 12 percent in 2011, commercial filings fall 19 percent" Jan. 4, 2012

    ]]>     Saving money, cutting debt in 2012 tag:www.maricopacountybankruptcyattorney.com,2012://2421.184489 2012-01-23T14:51:32Z 2012-01-23T14:54:10Z Earlier this month, you and your significant other may have sat down together at the kitchen table to formulate a financial plan for the New Year. However, you may have already encountered some level of frustration, feeling that perhaps debt... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 Earlier this month, you and your significant other may have sat down together at the kitchen table to formulate a financial plan for the New Year. However, you may have already encountered some level of frustration, feeling that perhaps debt relief and savings will remain unattainable as the weeks and months go by.

    As it turns out, this is far from the truth. According to financial experts, there are a few basic steps that ordinary Americans can consider taking to help improve their financial situation in 2012 and beyond.

    Some of the steps recommended by financial experts include:

    Create a budget: Sit down and take a hard look at your expenses and your income. Determine how much you need to cover your basic expenses and how you can limit your spending.

    Try lowering your interest rates: Contrary to popular belief, credit card companies may be amenable to lowering your interest rate (depending upon both company policy and your payment history). This can equal significant savings.

    ]]> Organize debts: Financial experts recommend organizing debts for which the interest is not tax-deductible. Basically, this means paying off the loan with the highest interest rate first, and then taking the monthly payment for that loan and adding it to the minimum monthly payment of the loan with the next highest interest rate.

    "So by the time you get to your last loan, you're paying one dollar amount that represents what you used to pay on maybe five loans," said Kris Funkhouser, and Atlanta-based financial advisor. "That's typically the quickest way to get it paid off."

    Research your vendor: Consider calling vendors (cell phone, cable/internet, electric gas, etc.) to ask for a lower rate. They may be amenable to negotiating lower rates, potentially saving you real money.

    Stay tuned for more from our Phoenix bankruptcy blog ...

    Whatever the cause, whatever the reasons behind your financial difficulties, take the time to speak with an experienced legal or financial professional if you would like to learn more about Chapter 7 bankruptcy, Chapter 13 bankruptcy or additional debt relief options.

    The following post is for informational purposes only and is not to be construed as legal or financial advice.

    Source:

    The Atlanta Journal-Constitution, "It's not too late to cut, save" Jan. 2, 2012

    ]]>     Report: Credit card debt dropped across U.S. in 2011 tag:www.maricopacountybankruptcyattorney.com,2012://2421.182882 2012-01-19T16:37:02Z 2012-01-23T14:50:47Z In our previous post, we discussed how the foreclosure rate here in Arizona and across the United States dropped significantly in 2011. Now, recently released statistics show that the number of Americans in need of some form of debt relief... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 In our previous post, we discussed how the foreclosure rate here in Arizona and across the United States dropped significantly in 2011. Now, recently released statistics show that the number of Americans in need of some form of debt relief due to unmanageable credit card debt also dropped in 2011.

    According to a recent report from the website CreditKarma.com, Americans reduced their average credit card debt by a whopping 11 percent in 2011. Specifically, the average amount of credit card debt for Americans in 2011 was $6,576 in 2011 as compared with $7,404 in 2010.

    This continues a trend from 2010, in which credit card debt fell by seven percent.

    What's behind this decline in credit card debt?

    Credit Karma CEO Ken Lin indicates that a continuing decline in consumer confidence coupled with a continuing effort by banks/lenders to reduce credit limits and rein in lending practices contributed to the overall decline.

    ]]> Interestingly, Lin believes that this phenomenon will likely not carry over into 2012 as the improving economy means more consumers will be spending and more lenders will be looking to extend credit.

    "I believe we are just about at the bottom of the debt trend," he said.

    Breaking the figures down further, it appears that the state where consumers had the smallest amount of credit card debt in 2011 was Wisconsin, where the average credit card was $5,062.

    Conversely, the state where consumers had the highest amount of credit card debt in 2011 was Alaska, where the average credit card was $7,937.

    How did Arizona fare?

    Statistics show that the average credit card debt in Arizona in 2011 was $6,811.

    Stay tuned for more from our Phoenix bankruptcy blog ...

    Whatever the cause, whatever the reasons behind your financial difficulties, take the time to speak with an experienced legal or financial professional if you would like to learn more about Chapter 7 bankruptcy, Chapter 13 bankruptcy or additional debt relief options.

    The following post is for informational purposes only and is not to be construed as legal or financial advice.

    Source:

    CNN Money, "Credit card debt drops 11%" Jan. 3, 2012

    ]]>     Report: Arizona has second highest foreclosure rate in 2011 tag:www.maricopacountybankruptcyattorney.com,2012://2421.181581 2012-01-17T15:48:38Z 2012-01-17T15:50:29Z Last week, RealtyTrac released a somewhat positive report on the current state of the foreclosure crisis: In 2011, foreclosure activity in the United States declined by thirty four percent from the previous year. According to the report, the number of... Clark Law Offices http://www.maricopacountybankruptcyattorney.com/mt-bin/mt-cp.cgi?__mode=view&blog_id=2421&id=2781 Last week, RealtyTrac released a somewhat positive report on the current state of the foreclosure crisis: In 2011, foreclosure activity in the United States declined by thirty four percent from the previous year.

    According to the report, the number of homes that entered the foreclosure process was roughly 1.9 million, the lowest figures since the Great Recession began back in 2007. In addition, foreclosure filings - notices of default and auction notices - reached 586,133 in the fourth quarter of 2011, a 27 percent decrease from the fourth quarter of 2010.

    RealtyTrac identified government investigations and the foreclosure freeze -- instituted by major mortgage lenders following revelations that they may have relied upon faulty procedures and/or deficient information to foreclose upon thousands of homes -- as one of the contributing factors for the decline in foreclosure/foreclosure filings.

    Specifically, these lenders re-filed thousands of foreclosures in state court systems and reviewed pending cases for errors throughout all of 2011, creating a sizeable foreclosure backlog in the process.

    "Foreclosures were in full delay mode in 2011, resulting in a dramatic drop in foreclosure activity for the year," said Brandon Moore, RealtyTrac CEO.

    ]]> However, as these legal issues continue to be resolved and more foreclosures begin to make their way through the system, the number of foreclosures will likely begin to climb this year.

    "We expect that trend to continue this year, boosting foreclosure activity for 2012 higher than it was in 2011, though still below the peak of 2010," said Moore.

    The RealtyTrac also report found that Arizona had the second highest foreclosure rate in the nation for the third year in a row, as almost 114,000 homeowners received at least one foreclosure notice in 2011. (This translates into one in every 24 Arizona households receiving a foreclosure notice.)

    However, it must also be noted that the number of foreclosures in Arizona dropped by 14 percent in 2011, while the number of homeowners who received a foreclosure notice dropped by 27 percent in 2011.

    If you are facing foreclosure, you should strongly consider contacting an experienced bankruptcy attorney to learn more about your rights and your options under Chapter 13 bankruptcy.

    This post is for informational purposes only and is not to be construed as legal advice.

    Stay tuned for further developments from our Phoenix bankruptcy blog ...

    Sources:

    Bloomberg Businessweek, "2011's foreclosure rate lowest since pre-recession" Jan. 12, 2012

    Mohave Daily News, "Arizona foreclosures drop by 14 percent in 2011" Jan. 12, 2012

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