Category Archives: Deficiency

With No Money, How Do I Pay My Attorney to File My Bankruptcy?

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How do I Pay My Attorney for My Bankruptcy?

By, Ginger Kelly, Esq.  April 10, 2018

The other day, a personal friend asked me (for a friend), whether or not they should she use their tax return tax refund to pay down their credit card bills or to replace the old and leaking roof on their home.  Their roof needed repairing badly.  Their credit card debt was very old and the payments were more than they could afford.  Even though I can’t make that final decision for this friend’s friend (or any of my clients), I can advise most folks of their legal options.  When people need to make a choice between a roof over their head or paying credit card bills, one good option available to most everyone is a fresh start.

In many or most situations, bankruptcy can give an individual or a couple, the fresh start they need. If you are in a position where you need to make important decisions like what to pay and what not to pay, like a roof on your home or to repair the vehicle you need to get to work, talk to a good bankruptcy attorney.  Most give free first consultations, like our office. Bankruptcy might be an option for you, or maybe not.  A person hasn’t lost but an hour of their time discussing their options with a good attorney.  Talking to a professional about options for taking care of debt, sometimes gives the clarity you need to make the right decisions for your future.

A client visited me the other day to discuss her situation. Apparently, she had debt exceeding any amount she could pay.  It wasn’t much debt, but it was a lot for her and that is important. Her earnings were barely more than the poverty level.  So while we had a nice hot cup of coffee, we talked about all of her options.  It was a nice pleasant, casual conversation.  I discovered that my client earned too much money to qualify for a free bankruptcy, through legal aid. She was sad and asked me what can be done.

Because her bankruptcy was not complex, I agreed to lower my fee. I gave her my best  fee option. Still, she was worried. Where would she find the money to pay the attorney fee? I asked her if she was getting a tax refund. She said yes, but it wasn’t enough. She was sickened with the idea of paying creditors all of her disposable income for years to come.

All of a sudden, she had an idea. She said, rather than trying to negotiate and pay down her credit card debt, using all of her disposable income, she said she could ask her uncle for the money. She said that she was thinking of asking him for a gift to help her pay down her loans anyway. Why not ask him for the same gift to pay her attorney’s fees?  Good idea! Sometimes asking relatives to help is a better option than worrying about how to pay overwhelming debt. I’ve had several clients in this kind of situation.

Once, a couple was in the same situation. The wife lost her job due to illness and then one thing led to another. They became deeply indebted, mostly to unsecured creditors (credit card companies). The best option for them was to file for bankruptcy. We talked a little bit and I gave them my best rate.  They were thankful, but without the extra cash, they didn’t know how to pay the legal fees. This was a problem for them.  However, determination overcomes lots of obstacles.

This couple scraped and saved and paid a little along. One spouse sold a baseball card collection and some tools.  The other sold some furniture they no longer needed. They used Craigslist and Facebook Yard Sale to sell a few more things.  They sent checks, one by one, to our office. Sometimes the check was small, sometimes large. We placed all of these funds into our client’s trust account, on hold for them until they finished paying. It didn’t take long. Within about four months, this couple paid all their fees, including the filing fee. This couple couldn’t have been happier.  I was so happy to help them in this way.

Once a person is determined to make a bad situation better, magic happens. There are more options for paying lawyer’s fees than these. Options are only limited by a person’s motivation, determination and imagination. Typically, I ask clients whether or not they have a tax refund coming to them.  This is a very good option for covering fees and things.  Then, I suggest asking friends or relatives for a gift.  At our office we have many ways of making your bankruptcy affordable, sometimes even free or at a reduced rate. Ask us how and perhaps we can help to make your fresh start,more affordable.  It may be easier than you think.

The Law Offices of Ginger B. Kelly is now accepting clients in the Sturbridge, Southbridge, Dudley, Webster, Oxford, Charlton, Auburn, Spencer, Brookfield, Warren and all of the Worcester County Area. We can explore whether or not bankruptcy is the easy way out or not.  We have a comfortable place to talk and a free pot of coffee waiting for you.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.

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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2018 by Ginger B. Kelly, Esq., all rights reserved.

 

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Filed under About Attorney Kelly, Bankruptcy, Chapter 7, Choosing a lawyer, Collection, credit card debt, Debt, Deficiency, Deficiency Debt, Filing, Financial, Foreclosure, Hiring Counsel, Judgements, Law, Lawsuits, Legal, Legal Rights, Liens, Massachusetts, Massachusetts law, Mortgages, payment, practical stuff, Rhode Island, Spouse, Student Loan Debt, tax refund, tax return, Uncategorized

Property Transferring No No’s, Before Filing Bankruptcy

Money in an envelope

Property Transferring No No’s, Before Filing Bankruptcy

by Attorney Ginger B. Kelly, February 23, 2018

There are a few types of transfers that will definitely not help if you want to file for bankruptcy to get a fresh start. One of those is types of transfers is called a prepetition transfer or (in other words) a fraudulent or irregular transfer.

Essentially, a prepetition transfer is a transfer of property (money or other things, including real estate) given to a person or creditor within 90 days from the date you file your petition. A prepetition transfer may also be a transfer of any property (money or other things, including real estate) to any insider, like a business partner, family or friend, within one year of your bankruptcy filing. Prepetition transfers are one of the biggest reasons why it is important to consult with a qualified, experienced, bankruptcy attorney, before you file. The prepetition transfer follows something called the 90 day rule.

Basically, the 90 day rule relates to debts that a debtor has paid, while insolvent, within the past 90 days of filing their bankruptcy petition and is set forth in section 547(b) of the Bankruptcy Code. The 90 day rule generally means that the US bankruptcy trustee has permission to avoid, (which means unwind or undo), any transfer made to a creditor or an insider if the transfer had an aggregate value of $600 or more provided that the transfer was made within 90 days from the date of the bankruptcy filing, and for any transfers made up to one year, if the person who received the transfer was an insider.

Here are a couple of examples of a fraudulent or irregular transfer:

Jane wanted to settle a debt before filing. She saved around $3,000 and was successful in negotiating with creditors to pay off one of her credit cards. Jane negotiated a settlement with blue credit company for $700 on October 30, 2017. She negotiated another settlement and paid red credit company $1,000 on November 1, 2017. After Jane negotiated successfully, with blue and red credit companies, she tried to negotiate with orange and green credit companies. She was unsuccessful. So Jane filed her bankruptcy without an attorney. Since she paid $700 to blue and $1,000 to red, her US Trustee avoided these transfers to get the money back. The trustee will allow all of Jane’s creditors to receive an equal share of the $1700 and prevent one particular creditor from benefiting more than the others. This is just one example. There are more.

The second section of the 90 day rule allows bankruptcy trustee to avoid any transfers of property made to any creditor that is also an insider (i.e., business partner, relative or friend) made between 90 days and one year of your bankruptcy filing date and exceeds and aggregate value of $600 or more.

In the next example, Steven bought his daughter Karen, a $15,000 car for graduating college. Steven paid $5,000 from funds he kept in his savings account and made the remainder of the purchase from a $10,000 line of credit on his credit card. On June 30, 2017, Steven transferred the title, over to his daughter.  In September of 2017, Steven lost his job. He was no longer able to make the remainder of Karen’s car payments. After four months without a job, Steven’s debt was piling up. So, in January 2018, Steven decided that he wanted to file chapter 7 bankruptcy to get a fresh financial start. If Steven were to file for bankruptcy before June 30, of 2018, there may be a good chance that the trustee would be able to avoid the car title transfer he made to his daughter, Karen. This would put the vehicle Steven just purchased for his daughter at risk. If Steven’s bankruptcy attorney knew of this transfer, the attorney would have warned Steven of the issues involving the purchase of Karen’s car prior to filing.

The fraudulent transfer rule involves all property, not just cash, and also applies to both chapters 7 and 13 bankruptcies. There are only a few exceptions. One, for example, is the exception for transfers made in the ordinary course of business, in other words, the property was sold to another (not an insider) for a fair and accurate value. But even so, bankruptcy can get complicated and for most folks, an attorney is usually needed to help out. Some people can’t imagine how to pay for a bankruptcy when they have no money. I’ll talk about that more, in my next article.

For now, if you’d like to set up an appointment to talk about affordability and your available options, call me. We can talk, face-to-face, and explore your options over a nice cup of coffee or tea.

The other day, a new client couple asked whether or not they should she use their tax return tax refund to pay down their credit card bills or use their tax refund to replace the roof on their home. Their roof needed repairing badly. Their credit card debt was very old. I cannot make that final decision for any of my clients, but I can advise them of their options. If you are in a position where you need to make important decisions like paying your credit card bills or paying for something extremely important, like a roof on your home, it may be a great idea to talk to a good attorney. Most give free first consultations.

If you are contemplating bankruptcy, and have some questions about a transfer you may have made or the 90 day rule, The Law Offices of Ginger B. Kelly is now accepting clients in the Sturbridge, Southbridge, Dudley, Webster, Oxford, Charlton, Auburn, Spencer, Brookfield, Warren and all of the Worcester County Area. We can explore whether or not bankruptcy is the easy way out or not.  We have a comfortable place to talk and a free pot of coffee waiting for you.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.

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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2018 by Ginger B. Kelly, Esq., all rights reserved.

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Filed under Bankruptcy, Chapter 7, Choosing a lawyer, Collection, credit card debt, Debt, Debt Collection, Deficiency, Empowerment, Filing, Financial, Judgements, Law, Lawsuits, Massachusetts, Rhode Island, tax refund, tax return, Uncategorized

What to do when your car isn’t worth the loan payments

Auto loan and credit card debt

By Attorney Ginger Kelly, December 15, 2017

I’m seeing it over and over again with folks in our Central Massachusetts area.  Car loans are so expensive and cars lose their value so quickly, it is causing harm to consumers.  As soon as the loan papers are signed, folks are strapped to payments they can’t afford.  It’s a shame and it makes me mad, the same kind of mad I get when I see what payday lenders can do to hard working families.

One person I know (I won’t mention her name), who earns less than $1200 per month in Social Security Disability Income went to a dealer to get a car loan on a new car.  She pays over seven hundred dollars a month for rent, yet the dealer down the street gave her a car loan.  Her car loan payments were over $400 per month.  What’s going on here?  This is robbery, in my opinion.

Another client I had a long time ago, purchased a new car for well over twenty two thousand dollars.  Less than a year later, she lost her job.  She could no longer afford her monthly car payments.  She had to do something so she tried to negotiate a modification of her loan.  Without her good paying job, the lender said no.  To keep her home, she lost her car and surrendered it moments before it was repossessed.  Then, the dealer auctioned the car to pay the loan.  The car brought in only a few thousand dollars at auction.  The outstanding balance she owed to her lender was well over twelve thousand dollars.  How does a brand new car loose over ten thousand dollars in value in less than a year?  The car had very little miles and was in almost perfect condition.  I don’t understand it.  This client was compelled to file a Chapter 7 to keep a lien from being placed on her home.  This is how it goes.  It’s sad but true.

Another couple purchased a vehicle in 2011.  The vehicle cost was over twenty thousand dollars.  They successfully made payments for over four years. Then, the wife got sick and couldn’t work.  This caused the couple to lose over half of their income.  They decided to downsize and only drive one car to save money.  They surrendered the car to the lender.  The lender, in turn, sold the car and then charged this couple with a fifteen thousand dollar deficiency on the loan.  This amazing couple, going through some very difficult medical issues, could not pay the deficiency.  They were barely making their mortgage payments. Eventually, the lender took them to court. The lender got a judgment lien against the only asset they had, their home. The couple was devastated. This is why they came to me for help.

My husband was talking to a colleague at work, just today, who asked him why he drives a used car. My husband replied, “Why would I want a new car that’s 50% discounted as soon as I drive it home and if something happens to me and I can’t pay for it, the car gets repossessed and I won’t be able to pay the amount the lender will charge me after the car is surrendered.” He added, “My wife deals with this all the time. She sees people suffering in this type of situation. Why would I put my own finances in jeopardy just to drive a fancy new car?”  My husband said it bluntly and truthfully.

Frankly, I’m baffled at the inflated prices of vehicles these days. I’m astonished at the shady things that seem to be happening to consumers who need to drive to work and school.  What is going on in the lending and auto industry?  Who doesn’t need a car these days?  Maybe this is part of the problem. Consumers need reliable cars, so they do whatever they think is best to get one.  But there is hope.

Several of my clients have had to think about debt consolidation or even try this until they consulted with me and discussed the differences between Chapter 7 and Chapter 13 bankruptcy and how this works.

Basically, a Chapter 7 is a total liquidation of all of your debts and a way to get a fresh start for most debt, but a person has to qualify first.  A Chapter 13 is a way to manage your debts by way of a three or five year payment plan.  In a Chapter 13, a debtor pays into this plan and then, after the end of the three or five years, comes out with a fresh start.  Bankruptcy is not for everyone, but it may be the only way to get rid of these not only annoying, but quite often unconscionable auto loan deficiencies.  For some people it’s the only way to stop creditors from placing liens on things like other cars and homes after they had to surrender their car or have it repossessed for one reason or another.

Bankruptcy, for some, is an option worth exploring.  Most Bankruptcy cases will cost anywhere from zero dollars (for qualifying pro bono cases) up to four or five thousand dollars, for some Chapter 13 cases and anywhere in between.  Attorneys cannot tell a client how much a bankruptcy case will cost until they have the opportunity to evaluate the work involved, the type of Bankruptcy needed, the complication of assets and debt and other factors.  But the good thing is, most bankruptcy attorneys offer a free first consultation for most clients.  If they don’t, I suggest that you think about visiting a bankruptcy attorney who does.

The next question my clients ask, I’ll touch briefly upon.  How does someone pay for a Bankruptcy if they don’t have any money?  Well, it’s not easy but it’s do-able.  Some clients sell collections or other things to find the money.  Most clients use tax return refunds to pay for their new start in life.  This is a very good option, indeed.  Still others borrow the money from friends or relatives (I do not suggest that you do this, however, sometimes it’s done anyway).  They ask relatives or friends to help out with a gift.  Christmas temp jobs are wonderful for helping out in a pinch.  Most of the time, where there is a will there is a way.  People find ways to pay for their bankruptcy and are happy to do so.

Tax season is right around the corner.  If you are thinking about whether or not to fix the roof of your home or pay your credit card debt, you might want to consult with a bankruptcy attorney.  If your car payments are too much of a burden for you and you are thinking of surrendering your car, you might want to consult with a bankruptcy attorney.  These are the real issues to consider in this coming tax filing season. Your next tax refund may be the way you too can enjoy a new lease on life and not to be bothered by the heavy burden of bills you cannot pay.

The Law Office of Ginger B. Kelly is a boutique type law firm.  We are not Big Law.  We only handle a small number of clients at one time.  Each client gets personal attention and care.  Each client gets hours and hours of time devoted to their particular case. Our office is in an easy to find location in Charlton. This means you don’t have to drive to the big city of Worcester or Boston and pay for parking. We not only offer free parking, but free coffee in a calm and peaceful place. Your discussion with our senior attorney is very confidential. Your first consultations will last about an hour in a stress-free, homey type atmosphere.

If you want to try a lawyer who is different, a new type of lawyer, Attorney Kelly is the one. Attorney Kelly is a lawyer who is interested in cultivating a more peaceful, kind and gentler approach to law. Her practice is unique. Her zealous advocacy is tempered by her high ethical standards. Her love for people provides the foundation for her attentive personal service. As one client put it, “This is like an old fashioned law office, very comfortable.”

Book your appointment now and explore your best options for the New Year.  We’ll have a nice pot of coffee waiting for you when you visit.

Good luck and have the Happiest of Holidays!

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.
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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We can not stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2017 by Ginger B. Kelly, Esq., all rights reserved.

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Filed under Auto Loans, Bankruptcy, Chapter 7, Choosing a lawyer, Collection, credit card debt, Debt, Debt Collection, Deficiency, Hiring Counsel, Judgements, Law, Lawsuits, Legal, Liens, Massachusetts, practical stuff, Repossession, Rhode Island, tax refund, tax return, Uncategorized