April 3, 2020

Middle Class Debtors Often Victims of Falsehoods and Misrepresentations

Man shoutingLast week, a former client called and tried to refer me a new Chapter 13 client who was facing foreclosure.  While I appreciated the referral, I could not take the case because the potential client was calling from out of town at 5pm on the Monday before his house was schedule to be sold at a foreclosure sale on the courthouse steps.  The potential client did not have a credit counseling certificate and because he had filed before twice, the automatic stay would not go into effect even if he did file.

During our conversation, the potential client told me that he had been negotiating with his mortgage company and that until that Friday, he was led to believe that a modification and restructuring of his loan was likely.

I hear the same story from vehicle owners who have fallen behind by two or more payments but who are talking to the customer service reps at their lenders.  I remember one case involving a woman who had never had any credit problems before but was struggling to pay her car note because of a job layoff. [Read more…]

Divorce and Bankruptcy – an Unhealthy Relationship

There are many reasons that bankruptcy filing rates are so high.   Clearly an unexpected job loss or reduction in earnings can lead many honest, hardworking people into a bankruptcy lawyer’s office.  When a job loss is coupled with a divorce, I think that the likelihood of bankruptcy by husband or wife goes up exponentially.

I recently read a column written by attorney John Mayoue, a divorce lawyer here in Atlanta who is known for his representation of celebrities and other high profile clients.   John notes that in the domestic relations legal community, Atlanta is known as the “divorce belt.”  In the bankruptcy lawyer community, Atlanta is known for having one of the highest bankruptcy filing rates per capita.  I do not think that this is a coincidence.

Just as an ethical bankruptcy lawyer will advise you to search for alternatives to Chapter 7 or Chapter 13, a thoughtful family law attorney will advise you to search for alternatives to divorce.  Bankruptcy or divorce may be inevitable, but when you seek legal counsel, look for a lawyer who does not offer “one size fits all” solutions and recommends alternatives – this would be a good sign that you are talking with a lawyer who has your best interests at heart.

John was gracious enough to give me permission to reprint his thoughtful article about why couples struggling in their marriages ought to consider alternatives to divorce.  I recommend that you take his message to heart.

Divorce Lawyer John Mayoue Offers Advice to Couples Contemplating Divorce

The divorce rates in the United States are some of the highest in the world. Increased financial pressure brought on by the current economy is fueling the fire for marriages already in jeopardy, and the rapidly increasing number of homeforeclosures further demonstrates the severe consequences these pressures can produce.

According to Atlanta, Georgia based divorce attorney John C. Mayoue, who has been counseling couples through divorce cases for more than thirty years, the approaching holiday season will cause these numbers to spike further and will also be a busy time for lawyers specializing in divorce cases, as the holiday season often proves to be a breaking point for marriages in crisis.

“During the holidays, people’s pent-up thoughts about relationships and careers and where they are with life become intensified,” Mayoue says. “In December, for example, we have the highest number of suicides, divorce filings and bankruptcies of any month. It’s just a very difficult time for people.”

Although our society makes divorce seem to be an easy and acceptable way out for couples who aren’t quite happy in their situation, Mayoue cautions couples not to be too hasty to start the divorce process. Divorces that make it to trial are painful and embarrassing, and the results are often not fair for both parties involved. If you are considering divorce, Mayoue suggest taking the following steps first.

1. Try to work out your differences

Ask yourself why you want a divorce. Are you just responding to life’s pressures? Are you looking for a way out of a stressful situation and not just your marriage? Or do you have legitimate concerns that are truly irreconcilable? [Read more…]

The Do It Yourself Bailout – Part Two of Jonathan’s Interview with Kenny Golde

Have you ever wondered what it takes to settle your debts for pennies on the dollar?  Recently I interviewed someone who started with $250,000 of credit card debt and with tenacity and focus, has managed to eliminate more than half of this debt through negotiation.  Here is part two of my conversation – it lasts about 8 minutes.  Kenny and I discuss the psychology of debt collection and the importance of seeing debt negotiation as a business transaction free of emotions or guilt.  “You are the CEO of your own corporation,” Kenny advises.  Part 3 will be posted tomorrow.

Link to WalletPop (Now Daily Finance) article discussed by Kenny in this segment

Link to Kenny Golde’s book “The Do It Yourself Bailout.”

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