Los Angeles Bankruptcy Lawyer

To File or Not to File Bankruptcy

Jan 232012

Roland Kedikian

This may sound strange, a bankruptcy attorney telling not to file bankruptcy. But bankruptcy is not always the best option for all individuals. In certain circumstances, some individuals should not be filing bankruptcy because they will get a better deal either negotiating directly with the creditors. Sometimes a debtor may have too much assets that can not be protected. And sometimes even if they can file bankruptcy, it may be that its not the best time for them to file bankruptcy. You should consult a bankruptcy attorney with regards to the specifics of your case. However, In general, you should not file bankruptcy if all of the following is true:

Your a high income individual more than the median income or the means test would allow in which case you do not qualify for chapter 7
You have too much equity in the different assets that you have that bankruptcy will not necessarily protect all of your assets
You have a low level of debt that you can resolve yourself directly with the creditor within one year.

I meet with many individuals in my practice. I welcome all clients and I do not screen who I will meet with based on whether this individual has the potential to be a client or not. Part of my practice is passing on credible information to individuals who are seeking bankruptcy advice.

An often situations that comes up is when an individual is facing financial stress, they are in fight or flight mode. They have to make a decision whether to file bankruptcy or just deal with the creditors. As is often, they consider whether bankruptcy is an option that will help them. They have heard that bankruptcy wipes out debt and gives the debtor a fresh start. They view this as quick way to move on from a particular debt without taking into consideration the totality of the restrictions that bankruptcy places on a debtor.

The above three rules of thumb together gives you an idea if bankruptcy is right for you. But I encourage you to contact and talk with me or better yet schedule an appointment so that we may discuss the facts of your case and provide a solution that is tailored for you. I am a Los Angeles Bankruptcy Attorney I represent individuals and businesses with bankruptcy and debt relief needs. If you live in Los Angeles County contact us, your local bankruptcy attorney familiar with local bankruptcy practice.

January 23, 2012
No Responses
Bankruptcy, debt

Foreclosure Filings Fell 30 percent in 2011

Jan 132012

Foreclosure filings fell dramatically last year, according to a report released Thursday. Several prominent economists said the news was a sign that the housing market could be stumbling toward recovery. But there’s still a mountain of foreclosures to work through. And there are millions of Americans living in limbo, reeling from the lingering affects of the housing crisis and waiting to see if they will lose their homes.

The number of homes with foreclosure filings plunged 34 percent to 1.89 million in 2011, according to RealtyTrac, a real estate site that tracks such filings. Total foreclosure activity was at its lowest yearly level since 2007.

The decline in foreclosures was mainly due to banks’ hesitance to foreclose on homeowners in the first half of the year, as the so-called robo-signing crisis played itself out. But there were strong signs in the second half of 2011 that lenders are finally beginning to push through some of the delayed foreclosures in select local markets.

The number of 30- and 60-day delinquencies has fallen substantially and that demand for homes is starting to grow, but it still will take four to five years for the housing market to become “well-functioning” again.

That’s a long time for the 1 in 5 homeowners who remain underwater on their mortgages, owing more than their houses are worth. Many homeowners are in limbo as banks try to determine whether to offer modifications on their loans or foreclose on them. Some experts said that the number of foreclosures has declined because there simply are fewer delinquent homeowners.

Banks have been slow to offer loan modifications but recently they have become more willing to facilitate modifications, lowering the number of foreclosures. Banks have realized that they may not make much money selling a foreclosed home in a depressed housing market.

Servicers have been slow to foreclose because they are not timely in processing anything. There could be a double dip in the foreclosure crisis as banks step up foreclosures in 2012.

January 13, 2012
No Responses
banking, Bankruptcy, Forclosure, Mortgage, Mortgage Relief

Your Friends on Facebook May Tarnish Your Credit Score

Dec 162011

Banks are now active participants in social media networks, and they are befriending their customers and their customers’ friends. As a result, banks are receiving and keeping huge amounts of data on their customers. In the last year or so, financial institutions have started exploring ways to use data from Facebook, Twitter and other networks to round out an individual borrower’s risk profile. A recent article in the online tech journal Betabeat discusses this concept and how your friends can one day determine your APR.

to read more …

December 16, 2011
No Responses
credit, credit score, improve credit, lending

How To Rebuild Credit after Bankruptcy

Dec 142011

Need to rebuild credit after bankruptcy, try the following.

1. Keep revolving balances below 30% of the high credit limit card you have

2. Limit the number of revolving accounts with balances. keep it under 3 if possible

3. Have 4 or 5 more revolving accounts that are open but have no balance

4. Don’t close old revolving accounts unless you have to. When you close an account you are closing the history. The account history is a factor that is considered.

5. Open new accounts when you do NOT need one, take the time to build the credit history so that the account will be available when you need it.

6. Pay your bills on time. put a credit cards you have balances on on some sort of automatic payment that will pay a minimum balance just in case you forget or were out of town.

7. If you’re paying off a collection account, pay off the collection agency and not the original creditor.

8. When you pay off collections try to negotiate with the collection agency to remove it completely from the credit bureaus.

9. Need to establish or re-establish credit? The best thing to do is get a secured credit card.

10. Late payments and collection accounts will stay on your credit report for 7 years–if you find some that are past this 7 year mark you should dispute them with the credit bureaus to have them deleted.

11. Shopping for an auto or mortgage? Try to do it within a 45 day period. Inquiries accrued in a 45 day period for the same industry will only count as 1 inquiry

12. Do not co-sign loans. If they make a late payment it will end up on your credit report

13. If you are negotiating a payment plan with any of your creditors, also negotiate how it will appear on your credit report. If they report it as– paying under a partial or modified payment plan–it will have a negative affect on your scores (Loan Modifications) or–settled for less than full balance (Short Sale). In the case of Short Sale you would want the reporting to be “paid”

14. If you have an account with a long history and only one late payment, ask that creditor if they will do a one time courtesy removal of the late payment

15. Have one or two installment loans. Having no installment loans or more than two can start to have a negative affect on your scores

December 14, 2011
No Responses
Bankruptcy, Credit Cards, credit score, rebuild credit

Bankruptcy Petition Signature

Nov 252011

Okay by now you would have completed the first online course. By now, I would have completed the preparation of the petition. At this meeting we will go over the petition and I will explain to you all the different portions of the petition. We will verify for the last time if all the information in the bankruptcy is correct, update all changes that may have occurred between the original interview meeting and the current signature meeting.

The typical time for me to prepare the petition is two weeks. In certain circumstances, the client may need additional time for practical reasons, such as having the remaining amount to pay the balance of attorney fees, the filing fee or the online classes. In other circumstances, we may delayed the filing of the petition for strategic reasons that might help a client qualify for chapter 7 when otherwise you would not have.

After a detailed explanation, you will be signing the petition, (approximately 15 signatures). The petition after the signature will be prepared for electronic filing which will occur within 2 days after the signature.

After the petition is filed, I will send you the notice of filing, and the notice of the creditor meeting which is typically scheduled 30 – 45 days after the filing. You will receive instructions as to what to bring at the creditor’s meeting and what to expect.

The next post will cover the 341 a meeting of the creditors and why I make a point of personally appear with you at that meeting as opposed to sending a substitute attorney as do so many other bankruptcy attorneys.

November 25, 2011
No Responses
Uncategorized

Bankruptcy Stages, Interview with attorney

Nov 222011

Once you decide you want to move forward, The next step is a detailed interview with the attorney himself to flush out and gather all the facts and documents needed to prepare a complete bankruptcy petition. By now, you have had the initial meeting with the attorney and the different bankruptcy option explained and a recommended course of action advised by your attorney. More importantly, you have had time to think about it and had all your questions answered.

For the interview, It usually takes me between 45 minutes to 1 hour to get all the facts I need to prepare my client’s bankruptcy. All the client will do during this time is answer my questions and hand me as many of the documents bellow that the client was able to gather uo. I do not ask clients to complete forms. Prior to the meeting I would have advised the clients to bring or gather up as much of the following documents as possible.

Tax returns for last 2 years filed.
Pay stubs for last 60 days (both spouses, if married).
All credit card statement and collection letters.
All vehicle payment statements.
All mortgage payment statements including, 2nd and 3rd mortgages, if any.
All student loans.
All back taxes due.
Any and all lawsuits against you.
Any documents that claim you owe someone money.
Your credit report. You can obtain a copy of your credit report for free from AnnualCreditReport.com Make sure you print each of the reports from each credit reporting agency you were able to access on paper or PDF file .

It is not unusual to have some of the above documents unavailable or missing, do not worry, I usually pull credit reports of my clients directly as well. And there are other places where I can gather other information that might not be readily available to the client. but the more you can provide, the better and more complete of a petition preparation I can do.

Once the interview is complete, It will take me about 2 weeks to have the petition ready for signature. However, in urgent circumstances, we can file within 24 hours. In the mean time, I provide the client instructions on completing the credit counseling course that must be completed prior to the filing of the bankruptcy. So while you complete the 1st of the required courses (don’t worry, it takes about 45 minutes to do it online) I go ahead and get everything ready. We will meet again in about 2 weeks time at which point I will go over the petition with you myself, and if all is well, the client will sign the petition for filing.

Next I will cover what happens after the petition is filed.

November 22, 2011
No Responses
Bankruptcy, bankruptcy exemption, consumer, consumer bankruptcy
Bankruptcy, bankruptcy stages, bankrutcy course

Bankruptcy Stages, Free Initial Consultation

Nov 212011

Roland Kedikian Bankruptcy Attorney

Bankruptcy stages start from initial consultation and end at post-discharge issues. The first step should be the initial consultation with a bankruptcy attorney.

Bankruptcy is a difficult choice for clients. Often the client has been unwilling to file bankruptcy for months or sometimes years. The reasons I see are many. Some are feeling ashamed believing that filing for bankruptcy is an admission of failure. Some are overwhelmed with the debt and simply do not want to deal with it. Sometimes clients are misinformed and believe that they either do not qualify or does not apply to their circumstances.

Sometimes I get clients who have tried or are trying to deal with creditors but are realizing that despite their best efforts, their financial circumstances are not improving. They are very discouraged for many reasons. Sometimes the creditor does not care and asks for much more that the client can afford. Sometimes the potential clients are making some payments but the interest rate is so high that the balance just keeps going up or will never be paid down. Sometimes the potential client has been working with a “debt consolidation company” only to discovery that the first 18 payments of a 60 month plan that was proposed to them, was going to pay the debt consolidator’s fees. And none of the payments have been going to any creditor and now they are being sued.

In my practice since 1997, I have never had a client who was just eager to file bankruptcy. I do not blame them that is the way its supposed to be. But when they do pickup the phone and call for help from an attorney, I applaud them for finally seeking legal and credible information to deal with their financial difficulties. Whether they ultimately decide to file bankruptcy or not is not important. What is important is that the client get the correct information about their particular circumstances and make an informed decision.

The first step in seeking knowledge and solutions about your financial difficulties is to meet with a bankruptcy attorney, not a paralegal, and not an an attorney who does everything else including bankruptcy. I have heard so many times from clients that come to my office telling me that they meet with a paralegal or an attorney who told the client, “they can file bankruptcy”. I tell them great, and continue with asking all the questions that I need to ask to familiarize myself with the financial situation of the potential client.

When I am done with my questions, the client is left wondering why the paralegal did not ask all these questions? how did the paralegal know if bankruptcy is the right choice? which chapter? what are the consequences? When the client voices their concerns about the paralegal. I tell them, “The paralegal told you they (the paralegal) can file bankruptcy” that is they can fill the forms and upload the petition to the court. The paralegal did not tell you bankruptcy is the right choice for you or that you, the client, should file bankruptcy.

Your first meeting with a bankruptcy attorney should be detailed as much as possible. It should be free of charge and It should be in person with the attorney himself who will be handling the case from beginning to the end. This meeting is as much as for the client to get to know the attorney as it is for the attorney to find the facts and circumstances of the client. After the initial questions, I explain what bankruptcy is, the different chapters, the process, my recommendation, the cost and give you the opportunity to ask any questions you want.

A bankruptcy attorney should be able to advise you whether bankruptcy is the right choice for you. Whether you qualify for chapter 7 bankruptcy or you must file a chapter 13 bankruptcy or you are better off negotiating your debts. Whether the timing is right, or if waiting couple of months may put you at a better advantage. What of your assets will be protected. What will be at risk. The answers to these questions are highly dependent on the exact circumstances of your particular circumstances.

At the end of the meeting, I will thank you for meeting with me, and I will ask you to go home and think about it or discuss it with you spouse. You should never be pressured to file bankruptcy by anybody.

Roland Kedikian is a Los Angeles bankruptcy attorney, providing bankruptcy solutions to debtors since 1997.

November 21, 2011
No Responses
Bankruptcy, bankruptcy exemption, consumer, consumer bankruptcy
attorney meeting, Bankruptcy, bankruptcy stages, chapter 13, chapter 7, free consultation, initial interview

Bankruptcy Discharge Student Loans

Nov 142011

bankruptcy and student loans Bankruptcy does not discharge student loans except in very small circumstances such as disabling event that prevents you from practicing you profession. In this post, which is part 2 of a series of how to handle debts, either in bankruptcy or outside of bankruptcy, I will talk about how to mitigate the negative effects of an unmanageable student loans. In the prior post, I talked about Bankruptcy and credit card debt. Today, lets talk about your options when it comes to student loans.

If you are about to graduate and you are unable to pay the debts, consider deferment. There are programs that allow you to defer the payments on your student loan for a period of a maximum of 3 years. Hopefully you will be able to obtain a well enough paying job in the mean time to begin covering your living expenses and start paying back the student loans.

If that is not possible, you must plan your spending behavior in a manner that recognizes that student loans are not discharged in bankruptcy. If you have to decide between paying a non dischargeable debt or a dischargeable debt, always, always, always, pay back the none dischargeable debt. Pay back you student loans first and foremost, and them make your credit card payments. So long as you are making the minimum payment and keep the interest rate on your credit card at very low interest rates, bellow 5%, (by doing balance transfer offers) you are staying above water and hanging on to fight another day.

If job prospects are not improving and your debt limit is rising steadily, at least it is the dischargable debt that is rising. Bankruptcy court will not penalize you for choosing to pay your student loans and not pay your credit card debt. Just do not go crazy using the credit cards. Use them for reasonable necessities of life and do not abuse the credit cards by doing major cash advances to pay off your student loans. If you have to file a chapter 7, in such a case at least you will wipe out all the credit card debt that accumulated, while you paid of the non dischargeable student loans.

In the next post in this series, we will talk about mortgage debt and how that can be handled in bankruptcy.

Bankruptcy filing reaches 1.4 Million through september 2011

Nov 112011

bankruptcy filings

1.47 million bankruptcies were filed between January and September 2011. A decline of 8% as consumers reduce debt and fewer businesses sought to reorganize or liquidate.

According to the Administrative Office of the U.S. Courts, business bankruptcies declined 18 percent in the first nine months of the year. Chapter 7 filings are down 18 percent and Chapter 11 reorganizations decreased 22 percent from the same period in 2010.

Consumer filings fell 11 percent to 1.06 million in the January to September period. Nevada remained the state with the highest per capita filing rate at 9.7 per 1,000 residents. Utah had the highest percentage gain in total filings for the 12-month period, followed by the Middle District of Louisiana, where filings rose 1.3 percent, and the Central District of California with a 0.9 percent increase.

Districts with the biggest percentage decrease included Guam, with a drop of a 31 percent; Vermont, with a decline of 26 percent; the Southern District of West Virginia, with a decrease of 24 percent; and the Western District of New York, down almost 20 percent.

The reason for the decline is a combination of factors. Lenders have been reining in the amount of credit they allow. Also, consumers can’t tap their homes as much for equity and are being cautious in spending. That means they aren’t getting into as much debt.

Bankruptcy filings by consumers are often driven by imminent seizure of a home or a car by a lender. Consumers seek bankruptcy protection to halt such imminent seizures. However, foreclosures have slowed sharply because of controversy over improper documentation and robot signing controversy. Additionally there are state and federal efforts to help borrowers that is also delaying the process and encouraging more settlements. Those are expected to pick up again when the paperwork problems are resolved.

November 11, 2011
No Responses
Bankruptcy, Mortgage, Mortgage Relief
Bankruptcy, chapter 13, chapter 7, debt settlement

Bankruptcy or Handling Credit Card Debt

Nov 092011

In this series of posts, I will discuss option available to you on handling debt. Lets start with credit card debt since this is the most common debt that consumers overwhelmingly have when filing bankruptcy.

If you are unable to make minimum payments on your credit cards, your credit score will be damaged, and you will get many calls form your creditor asking for payment.

1) Try calling your creditors and see if they will arrange a payment plan. Suggest to them, closing the account, reducing the interest rate and making reasonable payments on a monthly basis. Offering them $10 a month or “whatever I can” will not work, your figures must be reasonable given your circumstances and the balance that you owe.

2) Try consolidating your debt together with a low interest rate debt that you may be able to get on another credit card such as a balance transfer. But of-course to be able to have this option, your credit should still be intact, in other words, you can see the difficulties you are about to have and are preparing yourself in advance. Now here you may also be able to consolidate with a home equity line, but you must be very careful. In doing so, you are converting the nature of your debt from unsecured to secured debt that attaches to your house. (generally not advisable unless you are 95% sure you will be able to pay back in full and in a relatively short period of time)

3) Try debt management firms that might be able reduce the interest on each card and manage the payment to these cards. A reputable firm will charge you about $35 per month for their service. You must be very careful, there are many “companies” that charge you $6,000.00 before you realize that all the payments you are initially making is going to pay their “fees”. If you can not find a reputable firm that charges you monthly, try doing it yourself. That is try #1 above.

4) Try debt settlement. If you are behind about 6 months, your credit card debt is sold to a collection agency. They typically will offer 30% – 40% of the amount you owe to settle. However, often these collection agencies tag high interest and penalties and within a span of 6 months your original balance can rise substantially more that it was. Sometimes you end up with more debt than what the credit limit was on the original card. When negotiating with collection agencies, stick to what you think the balance that you owe and start offering them a percentage from there. Make sure you do not give any personal information to them like who you work for or your checking account number and bank information.

5) Finally there are bankruptcy options available to you. While there is a negative stigma attached to bankruptcy, In certain circumstances its the best option for you and your creditor. If you do not believe there is a way to pay back within one year, filing bankruptcy is a legal and most expedient way to resolve your financial predicament. This also will get the creditor to realize that they will not recover and move on without spending any more time, money and effort on this debt. You can read more about bankruptcy chapter 7 and chapter 13 at our website www.LosAngelesBKLaw.com or consult an attorney in your area.

In following posts I will discuss how to deal with other debt such as student loans, taxes, medical bills, Mortgage payments 1st and 2nd, Auto payments and medical bills.