Category Archives: Financial

Utility Shut-off Solutions

Attorney Ginger B. Kelly

Good advice from Attorney Ginger Kelly, licensed since 2004

Utility Shut-Off Solutions

by Ginger B. Kelly, Esq., January 11, 2019

I’ts that time of year, again.  The time when utility costs sky-rocket into the netherworld of bills you wish you could pay, but can’t.  But wait, don’t be too hard on yourself.  There are a few solutions to help you navigate this rocky road of uncontrollable utility bills.

Mass.gov has multiple solutions for certain people.  For example, if you live in Massachusetts, and if all the people residing in your home are age 65 and over, your electricity or gas cannot be shut off without permission from the Department of Public Utilities (DPU).  If you are experiencing financial hardship and one of the following applies, your electric or gas cannot be shut off without permission from the DPU:

  • You, or someone in your home, is seriously ill;
  • You have an infant under 12 months in your home;
  • All adults in the home are age 65 or older and a minor child resides in the home;
  • It is between November 15 and March 15 and the utility service is needed to heat your home.

If you meet these requirements and your electric or gas has been shut off, you should call your utility company directly. They will ask for proof of your situation, such as a child’s birth certificate, doctor’s note for a serious illness, or income-based proof of your inability to pay. 

If, after speaking with your utility company, your electric or gas service is not restored, you should contact the Department of Public Utilities at (617) 737-2836 or 1-877-886-5066 (toll-free) or complete their online complaint form.

If your water is provided by the city or town where you live, you need to contact the city or town directly to have your service restored. The Department of Public Utilities has a list of all the water district areas in Massachusetts.

If your water is provided by a company, your water cannot be shut off if one of the following applies:

  • Everyone in your household is age 65 or over;
  • You, or someone in your home, is seriously ill;
  • You have an infant under 12 months in your home;
  • All adults in your home are age 65 or older and a minor child resides in your home;
  • You are a tenant whose landlord is responsible for the water bill.

If, after speaking with your utility company, your water is not restored, you should contact the Department of Public Utilities at (617) 737-2836 or 1-877-886-5066 (toll-free) or complete their online complaint form.

Oil, Propane and Wood (Un-Regulated Utilities)

There are no specific legal protections for utility customers who heat with oil, propane, or wood. However, providers of these utilities are often willing to work with consumers who find themselves in difficult situations. You should contact your service provider directly and if you cannot get your utility restored, you should file a complaint with CARD.

How can I get help making my payments?

You may seek help from your local fuel assistance office if you are having trouble paying your utility bills. You do not have to be unemployed to get help. In addition, utility companies are often willing to work out discount, budget, and payment plans. You can learn about your fuel assistance options here.

How can I find out about my other options?

If you are facing a utility shut-off, including your electricity, gas, water, or telephone due to unpaid bills, filing Chapter 7 bankruptcy may help keep your service connected. Under federal law, if you file for bankruptcy, the utility company cannot change, refuse, or disconnect your service.  Contact an experienced bankruptcy attorney to find out your options.

If you are poor and meet certain income guidelines, you may qualify for legal aid.  Another suggestion is not to use your income tax return refund check to pay for your back bills, but use it to pay for your bankruptcy and be free from most all of your crushing debt and back utility bills.

At our office, there are a number of ways to pay for your bankruptcy, including using your federal and/or state income tax return refunds.

If you have other legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland.  We can explore whether or not bankruptcy is the easy way out for you.  Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

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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 our website, 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, Collection, credit card debt, Debt, Debt Collection, Empowerment, Filing, Financial, Financial Planning, Legal, Legal Rights, Massachusetts, Massachusetts law, Massachusetts town ordinance law, payment, practical stuff, Uncategorized, Utility Bills, Utility Shut-Off

Top 4 Reasons NOT to Consider Bankruptcy

 

Top 4 Reasons NOT to Consider Bankruptcy

By Attorney Ginger Kelly, December 24, 2018

It’s not unusual to borrow money and have every intention of paying it back. But for some unknown reason, you can’t pay it back. Maybe you lost your job or your hours got cut. Did your small business just crash or were sick or hospitalized. Sometimes you need to stay home with a sick child or elderly parent. Whatever the reason, it’s very human to find yourself unable to pay back loans and credit cards. When life happens, and you are stuck with debt you can’t pay, it’s OK to talk to an experienced bankruptcy attorney.

Although many people avoid the “B” word, bankruptcy, bankruptcy could be the tool you need to get back on your feet. If you can’t decide what to do, here are the top 4 reasons why you should not consider bankruptcy.

Number #1. The Hole you’ve Dug for Yourself isn’t too Deep to Get Out

Paying and paying on credit card debt without making a dent in the balances is a perfect storm for credit disaster. Another problem is paying a minimum payment on a judgment for years and years and years and the balance just doesn’t go down, it appears to go up. These are problems that may lead you to think bankruptcy is the best option. But what if you are simply annoyed at paying bills? The best plan of action to take is to do the math. Weigh your disposable income and your unsecured debt. Are you making more than your minimum payments? Are you making any progress paying down principal? Even if you can only see a slight dent in the principal, over time, but it’s taking a long time for you, evaluate whether bankruptcy is really the best idea for you right now. If you have no employment or medical issues, no change in family status, keep plugging along. Bankruptcy is probably not for you.
Dennis, a Veteran living by himself on Social Security and a small pension had problems with a judgment on a small debt. Because Dennis did not defend himself in court, so the creditor obtained a judgment against him. This was way back in the 90’s. Dennis had no choice. He started making very small minimum payments of about $30 per month out of his disposable income, which wasn’t much. In 2017, he came to me for help. Dennis paid almost $9,000 to his creditor over the years and he couldn’t see any end in sight. Since Dennis had little monthly disposable income and other medical debt, bankruptcy was a good fit for Dennis.

Tip #1: If you can’t afford to pay all your unsecured creditors in full, over the next 3 years, your current strategy isn’t working.

Number #2: You Have NOT Looted Your Retirement Account to Pay Bills

It can be very tempting to take a loan or an early withdrawal from your retirement funds, simply to keep your head above water. But if you have the means not to do this and to seek help first, even when debtors are filing law suits against you, awesome! Borrowing money against your retirement account is a very big risk, especially if you are close to retirement age. By looting your retirement, you are not getting out of debt easily. You are actually taking from old-age self and using it, hoping you will recover. Most people don’t recover. And don’t forget the consequences of early withdrawals. It’s not worth it. Alternatively, consider making plans to contact a bankruptcy attorney who can help you move forward, not backward, before you decide to loot your retirement accounts.
Steve is currently being sued by a lender for a repossessed vehicle because he suffered road bumps in his career. After several layoffs, he decided he could no longer afford his $400 a month car payment. He surrendered his car. After the lender sold his car at auction, Steve still owes about $10,000. If Steve borrows from his retirement account he can pay off this debt and not have to worry about the law suit. Sounds tempting, doesn’t it?

Steve decides to hire a lawyer and the lawyer negotiates with the lender for a payment plan. He sticks to his monthly payments and pays off this debt within 3 years. Steve still has enough money to save for retirement, repair his current vehicle, eat out every once in a while and pay his mortgage. Steve probably doesn’t need to file for bankruptcy.

Tip: Seniors who need the relief bankruptcy are often tempted to use precious retirement funds to pay off credit card debt. If you find yourself in this situation, consider this a big red flag.

Number #3: Your Family Isn’t Going to Suffer

It’s a known fact that having a child is not easy. Some say that having a child is the single greatest predictor that a single person will end up in financial collapse. When struggling with debt and weighing your options, consider who is dependent upon you. What are their ages? Do you have an “emergency fund” to care for them if something unexpected happens? The larger the number of dependents you have, the more likely you are to need an emergency fund and health insurance.

Karen got slammed with a judgment from one of her credit card creditors. It was from a debt she acquired back in 2006. She was very upset. Karen is a single working mom, supporting two school-aged kids. Their father pays hardly any child support. If Karen’s creditor garnished her wages, or she lost her job, how would she pay her rent, feed her children and buy gas to get to work? With this in mind, Karen worked out a payment plan with her creditor and is now making minimum payments. Karen is also saving for emergencies and has enough disposable income to pay for things like school pictures and activities, clothes, food and gas. If this wasn’t the case, Karen would probably benefit greatly by talking to an experienced bankruptcy attorney. But since her family is doing fine, and she’s paying her unsecured debt and her bills, bankruptcy may not be a good option just yet.

Tip: If you have dependents, be sure to stash some cash into an emergency fund.

Number # 4 You’ve Got Equity on Your Home AND you can Catch up on your Past Due Mortgage Arrears

It’s been estimated the over 7 million Americans are underwater on their mortgages. But there are many ways of finding relief, like negotiating a loan modification and talking to your lender. If you file for bankruptcy these are the 5 things you may be able to do, as a last resort of course.
1. Catch up on past due mortgage payments or negotiate a loan modification so you can stay in your home;
2. Eliminate a second mortgage or home equity loan through bankruptcy;
3. Erase debt that could be due if the lender foreclosed and sold your home for less than you owed;
4. Free up money that you were paying on other debts so you can afford your home loan; and/or
5. Avoid a big tax bill from “cancellation of debt income” that could happen if your home goes into foreclosure or if you negotiate a short sale.

Where to Get Help

A consumer bankruptcy attorney can help you understand how filing may help you. Many offer low-cost or free consultations. Every bankruptcy attorney should tell you of your options and alternatives to bankruptcy before you make those very important decisions.
If you have other legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland. We can explore whether or not bankruptcy is the easy way out for you. Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

The Law Offices of Ginger B. Kelly

167 Carpenter Hill Road

Charlton, MA 01507

(508) 784-1444

AttorneyGingerKelly@gmail.com

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Bankruptcy for Smart People

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Bankruptcy for Smart People

By Attorney Ginger B. Kelly, September 13, 2018

For some people, bankruptcy is a very helpful tool.  Bankruptcy was intended to help people in debt to recover, get a fresh start and begin again to regain financial stability.

Why File Bankruptcy?

People file for bankruptcy for a variety of reasons.  Some want to save their homes from foreclosure.  Some want to keep their wages from being garnished.  Many want to get rid of (or avoid) liens placed on their homes by creditors.  Many are struggling with medical debt, credit card debt and other unsecured loans.  Some have financial trouble due to medical issues, loss of employment, divorce, the death of a family member and a host of unforeseen accidents and problems.  Sometimes people struggle due to poor judgment or in making unwise financial decisions.  Whatever the reason, there are essentially two types of bankruptcies for most individuals and married couples.  Most people (not businesses) file under particular bankruptcy Chapters, Chapter 7 and Chapter 13.

Chapter 7

Chapter 7 bankruptcy is relatively straightforward and is sometimes called a “straight” bankruptcy.  You can file, under Chapter 7, if you are an individual or a married couple but you have to qualify first.  To qualify under Chapter 7, income and expenses must meet certain guidelines and the filers must complete a state approved, online or telephonic credit counseling course.  A Chapter 7 bankruptcy is often called a liquidation of assets, although very rarely are all the assets of a person or a family actually sold, or liquidated, by the Bankruptcy Trustee.  The Trustee is the person working for the US Trustee’s office.  The Trustee is the attorney looking out for the creditor’s side, or working on behalf of all the creditors. Most filer’s assets are exempt or protected under state or federal bankruptcy laws.  Under Chapter 7, most debts are discharged within about six months from the date of filing, provided there are little or no underlying issues or problems.

Chapter 13

Under a Chapter 13, an individual or a married couple must also qualify and take a course before filing, but the difference is that they will need to make payments to creditors into a five or three year repayment plan.  During that three or five year plan period, the filer will need to pay a minimum of 10% of all their debt to most creditors, using whatever disposable income that person or couple has. Disposable income is income that is left over after paying all necessary and reasonable expenses, including things like child support, mortgage and auto loan payments.  Most Chapter 13 Trustees require that you make payments through a payroll deduction, unless there is some sort of hardship or danger of job loss or some other serious consequence.  A Chapter 13 bankruptcy takes longer and during the three or five year period, things may be financially tighter, but most people qualify for bankruptcy under this Chapter.

Chapter 13 also has many advantages over a Chapter 7. For those facing foreclosure or repossession, filing for Chapter 13 bankruptcy can help save a person’s home or vehicle by allowing the individual (or married couple) to catch up on missed payments through the repayment plan.   Sometimes a Chapter 13 will allow a debtor to catch up on missed child support payments.  Credit bureau scores are not as severely affected compared to a Chapter 7.  Also, Chapter 13’s can be filed more frequently, unlike Chapter 7s which cannot be filed less than once every eight years.

Chapter 11

Chapter 11 bankruptcies are typically used by businesses, but some individuals and small business owners may file under Chapter 11 as well. A Chapter 11 allows businesses to restructure debts and to pay them back over time.  Chapter 11 bankruptcies are very useful for someone who does not qualify for a Chapter 13, although this type of bankruptcy is more complex than a Chapter 7 or 13.

Life after Bankruptcy

Whether it’s Chapter 7 or Chapter 13 you are thinking about, keep this in mind. If you want to file because you’ve had some sort of significant event in your life like an extended period of unemployment or lots of medical bills, bankruptcy is a very effective tool.  Bankruptcy may help you catch up or eliminate most of your debt and a great way to reorganize your financial life.

However, if you are experiencing financial hardship because you never learned how to manage money and you tend to spent beyond your means, filing for bankruptcy may not be very helpful. In other words, bankruptcy can get most folks where they want to go, but it won’t keep them financially stable without a little work.  Living within your financial means and tackling the reasons why you tend to spend beyond your means is critical for success.  Although one in every one hundred people may file for bankruptcy each year, only 8% of those people every file again.  This means that most folks figure it out.  They regroup and regain sound financial ground.  You can too.  It’s really quite simple.

Why Smart People File for Bankruptcy

Steve Rhode of the Huffington Post thinks that bankruptcy is not a moral decision, but rather an important strategy for dealing with financial difficulty and getting back on your feet rather quickly.  He says that people who file for bankruptcy are smart.  I agree.  Being honest and upfront, especially about difficult and challenging situations, is the most likely way to reach a positive outcome.

If you have other legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland.  We can explore whether or not bankruptcy is the easy way out for you.  Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

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ABOUT: 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 our website, 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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Master Medical Debt Lawsuits in 10 Easy Steps

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Master Medical Debt Lawsuits in 10 Easy Steps

By Attorney Ginger Kelly, July 19, 2018

Being sued by a debt collector or service provider over medical debt is no picnic. If you can’t afford to pay the initial debt, it is likely that you still can’t pay it. Going to court is also very stressful, time consuming and costs you time off from work and other more important things. These are things we all worry about.

Although you may be tempted to ignore a medical debt law suit you know you can’t pay, it is always best to show up. If you ignore the law suit, the other side wins, automatically by default.  A default Judgment will haunt you and your credit report for twenty years in Massachusetts.

What happens when you show up for court?  Below are 10 steps that you can take if you are facing a medical debt lawsuit.

  1. Find out where the debt comes from

You cannot properly talk about your lawsuit until you fully understand why you are being sued. Past bills should tell you something about the debt.  Find a date of service and, perhaps, an itemized list of what services were given to you that you are being charged for.

  1. Answer the lawsuit

In most medical debt and other consumer debt cases, people don’t have an attorney. Hiring an attorney is a wise move, so seek a free first consultation with a lawyer before you hire them. Sometimes, a lawyer can help you to represent yourself.

Many times, when people meet certain income guidelines, they can apply for free legal aid. Worcester Community Legal Aid services is an example of one of many nonprofit public service centers, helping clients with free and reduced fee legal services for debt collection law suits. Many times, a limited service lawyer will be at the courthouse to help clients. Call and find out when this free service is available.

  1. Prepare for court

The next step to take is to prepare to answer your lawsuit. In Massachusetts a defendant has twenty days from the date of notice to answer a small claims or civil suit. Answering a law suit involves filling out paperwork at the court, which will involve answering every paragraph and including all your legal defenses along with a certificate of service saying that you mailed a copy to the other side. Then, you have to mail the paperwork to the other side who is suing you.  Next, show up at the initial court date. After you answer the suit, the court will set a date for the discovery part of the trial. It is very helpful to find a lawyer who can advise you regarding this process.

It’s important to make this initial court date.  Traditionally, in Massachusetts, this is called a discovery or pre-trial conference where you have time to talk to the other side and see if you can make a deal.  It’s helpful to ask for a payment plan and a reduction of the debt.  At this stage of the game, it is unlikely that the judge will grant you a continuance that would move the court date further out. It’s probably best not to ask unless you live out of the jurisdiction and you would like to get counsel to move the suit to a better place where you can defend.

At the discovery part of your lawsuit, you will have to file more paperwork about your finances and will need to sit and wait to talk to someone. This is not the time to present evidence that you are not liable for the debt. If you are not liable, you can present this evidence at hearing. This means, you will need to show up another time for hearing.

  1. Know about wage garnishment

If at hearing, you are found liable for the debt, or if you failed to answer the lawsuit and the judge rules against you, the court may issue a judgment order and an execution, giving the lender or collection agency the ability to garnish your wages. Social security benefits, disability insurance payments, unemployment, VA benefits and other things, like public assistance and child support are excluded from garnishment.  If you have any of these forms of income, it’s wise to set up a different bank account where those funds are deposited and keep all garnishable wages in another separate account. Do not mix these funds with other things like regular wages.

By federal law, the lender or collection agency can’t take more than 75% of your income. Based on Massachusetts law, which is more protective, creditors can take only 15% before taxes or other deductions, or they can take your disposable income less 50 times the greater of the federal or Massachusetts minimum wage. Effective January 1, 2017, the Massachusetts minimum wage is $11 per hour.  This means that any amount exceeding $550 per week can be garnished from your wages, in Massachusetts.

Also, under Massachusetts law, some medical institutions can take your tax return refund to pay past due bills.  It’s better to take care of them before your tax refund is levied.

  1. Were you served properly?

Sometimes wages are garnished before the plaintiff is even aware that there’s a lawsuit against them. This happens most commonly when you’re improperly served. Examples of using “improperly served” as a legal defense include papers being only mailed to you and not delivered in person, papers being left at an incorrect residence, or papers being mailed to an old address. Being “improperly served” does not mean that the papers were left with a family member or friend at your residence and they forgot to tell you about it. If that happened, you’re still on the hook.

If you have been improperly served, or if you find out that the court mistakenly started garnishing wages because you have the same name as an actual plaintiff, you should contact a lawyer immediately.  Find out what possible resources there may be for you in your situation.

  1. Get low-cost or free help from financial assistance programs

Under the Affordable Care Act, these hospitals must provide some type of financial assistance program to low-income patients. Even if you aren’t from a low-income household, you should apply, as some hospitals extend their programs far beyond the poverty line. Many hospitals also extend this program to insured patients.

  1. Discriminatory pricing

If you are being sued in court and are uninsured, discriminatory pricing can serve as a defense. If you qualify for the hospital’s financial assistance program, the hospital must legally reduce your bill to the amount generally billed to insured patients.

  1. Look out for balance billing

Balance billing happens when your hospital or medical provider bills you instead of or in addition to Medicaid or Medicare. It’s a forbidden practice, and you are not responsible for any amounts due when this happens.

You may be able to identity balance billing if you receive an “Explanation of Benefits” from your insurer that states the amount they covered and the amount you still owe. If this does not match the bill your medical provider sent you, there is a cause for concern. Additionally, if the bill you receive does not show any payment from your insurance when you are, in fact, on Medicaid or Medicare, it may be a sign that you are a victim of balance billing.

  1. Stop lawsuits before they start

If something about your bill doesn’t look quite right, there are ways to reduce it to its fair amount. Debt collectors, hospitals, and other medical providers don’t want to take you to court. It costs them money, and the odds of them actually getting a full payment at that point are very low. They are almost always willing to work with you before issuing a lawsuit. Negotiate. Apply for financial assistance. Set up a no interest payment plan directly with your health care provider.  Keeping the lines of communication open is the best way to avoid costly litigation and compounded interest and fees.

If you didn’t have insurance at the time of service, a good idea is to contact the doctor or debt collection agency and try to negotiate the bill down to Medicaid/Medicare prices.  This should save you at least one to two thirds the initial cost.  If a provider doesn’t want to negotiated, your attorney can use, “discriminatory pricing: as a legal defense in court.

  1. Weigh bankruptcy

There may come a point in the process to consider bankruptcy as an option.  Filing for bankruptcy may alleviate the medical debt and all your other bills. However, as a cautionary measure, bankruptcy is not a decision to take lightly.  A chapter 7 will remain on your credit reports for up to 8 years and make it difficult to qualify for new credit with a low interest rate.

There are two types of bankruptcy: Chapter 7 and Chapter 13.  Chapter 7 is a form of liquidation.  If you qualify, a Chapter 7 bankruptcy requires you to sell off all of your non-exempt assets to settle what you can of your debt obligations. If you don’t have any non-exempt assets, this part probably doesn’t matter much. What does matter is that most of your debt, if not all, will disappear after you receive your discharge.

A chapter 13 Bankruptcy is a type of reorganization of your debts.  In a Chapter 13, you do not have to sell off any assets, but the debt won’t disappear either.  Instead, you will pay your debt from your disposable income via a 3-5 year payment plan. After the 3 or 5 year plan is over, the rest of any qualifying debt you could not pay out of your payment plan is discharged.

Filing for bankruptcy makes sense if the court has already issued an order to garnish your wages.  However, at any other point in your situation, it makes good sense to try to negotiate and set up a payment plan with the medical service provider or debt collection agency directly.

A debt collection agencies last resort is wage garnishment, but it doesn’t have to come down to this. By knowing your rights and negotiating, effectively, rather than damaging your credit scores, you may have a good chance to work through a win-win situation.

If you are contemplating bankruptcy, and have some questions about wage garnishment or medical debt, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, Charlton, Auburn, Leicester, Spencer, Brookfield, East Brookfield, West Brookfield, Warren, Brimfield, Wales, Palmer and Holland.  We can explore whether or not bankruptcy is the easy way out or not.  Our office is a quiet and comfortable place to talk and a free pot of coffee will be waiting for you when you arrive.

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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, Civil, civil law, Collection, credit card debt, Debt, Debt Collection, Deficiency, Deficiency Debt, Empowerment, Filing, Financial, Hiring Counsel, Judgements, Law, Lawsuits, Legal, Massachusetts, Massachusetts law, Medical Debt, payment, practical stuff, Rhode Island, Uncategorized, Wage Garnishment

Clearing Financial Clutter, Minimalist Style

Keep or throw away

Clearing Financial Clutter, Minimalist Style

By Attorney Ginger B. Kelly, June 6, 2018

Living the minimalist lifestyle has been an ongoing passion of mine for at least the past five years. Working on becoming less cluttered, less driven by my own urges and material wants, is something I strive to do every day.  In turn, this leaves more time to become more creative, mindful and wise. This is a process, not a destination.

Minimalism is also a movement. It’s a personal organization life-design and a simpler way of life.  Living the simple less cluttered life, financially, tends to make your wallet and your heart more full and happy.  A person only needs a few things to find comfort and safety.  Likewise, a person only needs a very few tools to keep their financial life under control and comfortable.  Many credit cards and savings accounts will not bring more mental calmness and financial security.  In fact, a cluttered financial life will limit your options and your productivity.

USE ONE SIMPLE PLAN TO PAY YOURSELF FIRST

First and foremost, pay yourself.  Use one long term savings account, if possible.  The strategy is to save at least 10% for your long term retirement goals.  The minimalist strategy is to have only one 401(k) or one IRA and invest in this.  If you want to get fancy, have two accounts. For example, have one annuity and one 401(k) or have two 401(k) accounts, one for each spouse. If you are older, it is not uncommon to have more than one long term savings plan.  However, a multiplicity of whole life policies, stocks, savings bonds, mutual funds and 401(k) accounts will not help to drive your financial goals forward.  In fact, many accounts drive most folks crazy.  Avoid multiple fees, multiple financial institutions, more than one financial adviser and tons of “stuff” to look after. Then, save it and forget about it. Have the money taken out of your pay check, each and every pay period, and you’ll never miss it.  Out of sight, out of mind.  This really works!

Tip:  If you can’t save 10%, start with a minimum like 4%.  Increase this figure every year until you reach the goal of 10%.  Ask your tax accountant and financial adviser to help you plan a strategy that is realistic and works best for you.

HAVE ONE CHECKING ACCOUNT AND ONE SAVINGS ACCOUNT

Two or more bank accounts do not help clear the mind nor do they add value to your life. Two checking and savings accounts require extra passwords, extra time, extra books, extra statements, extra checks and other not so valuable things, like bank fees and charges. Get rid of all checking and savings accounts but one, unless you own a business. If you own a business have two, one for your business and one for your personal finances.

Also consider having only one savings account and using it. A savings account is an important tool, useful for short term goals, like car repairs and/or down payments, kid’s activities like summer camp, gifts and summer vacations. A good rule of thumb is to save 5% to 10% of your gross income each month for short term goals. That means, if you earn $2,000 per month, you should be stashing away at least $100 to $200 per month into short term savings.

Joint Account Tip: Sometimes it’s a good idea to have designated “jobs” when working together with joint accounts.  Find a simple plan and strategy for you, as a couple, and follow that.  Be honest with each other and communicate about everything important. If you can’t work together, seek counseling, a trusted priest, pastor or neutral party to help you correct underlying breakdowns, fears and anxieties.

Savings Tip:  Saving the equivalent of at least one car payment each month just for transportation is a great rule to follow, whether or not you actually have a car payment. If you aren’t saving anywhere from $100 to $400 per month, simply for transportation, then a $50 bus or mass transit pass may be the better option. For most folks, driving to work is far more important than an expensive mobile phone plan or eating out over and over again.

LIMIT CREDIT CARDS TO ONLY THREE

Get rid of all credit cards and revolving credit accounts but three. Why three? Most people remember and retain information very well in increments of three. Any more than three points, topics or tasks and the waters get muddy.  As a bankruptcy attorney I’ve seen a lot of things.  Having tons of credit cards seems to be a thing these days.  The point here is to not get hung up on the numbers of cards you have, but to shed unnecessary high interest cards and revolving accounts that charge unwanted fees. Caring for balances and payment dates is easy, when there are only three. No is a very empowering word.  Set a goal and use the word no to your advantage. When it comes to credit cards, less is best.

Tip: Don’t close credit card accounts in the days, weeks or months before making big purchases, like a home or a vehicle.  Closing credit card accounts can actually lower your credit scores for a time. Keep this in mind. After you’ve made that big purchase, then you can begin to close small revolving accounts you don’t need and ones with annual fees and things that do not add value to your financial well-being and peace of mind.

Another tip: Coordinate your credit card payments with your pay period.  This makes paying your cards, on time, every time, easier. Then, every pay period, when checking on your bank balance and direct deposit, pay your credit card bills (all at the same time). Having multiple due dates on many credit cards is nothing less than stressful and confusing. Ask your lender how to do this.

As we can see, there are a few financial “things” almost everyone needs to get by in life and plan a successful future. Too many and life gets complicated. Jen, Ray and Mary are great examples of this.

Jen and Ray are a couple who decided to take the minimalist approach and de-clutter their finances.  They gave themselves clear goals to de-clutter their finances, with broken-down steps on how they wanted to attain them.  Most importantly, they wrote down why they wanted to live more minimally and posted their goals on a calendar.  Over the course of just one year, they reduced their credit cards from ten to four. They eliminated six checking accounts to two. They also started a joint savings account and began to save money into Ray’s 401(k). They have saved over $300 in typical,  albeit unintentional, yearly overdraft fees and bank charges. Even better, Jen and Ray communicate much better and have far less stress and anxiety.

Mary, in taking her first steps toward getting rid of clutter, wrote down the fact that she didn’t need hundreds or useless items and financial tools to be happy, unique and to feel secure.  Part of Mary’s plan was to get rid credit cards and spend less.  She eliminated her JC Penny, WallMart and TJMaxx cards and decided to keep her cash-back Discover card and a lower interest Citi Bank card with no annual fee.  Mary also decided to have only one checking and one savings. Then, she started to save 10% of her income for a newer car purchase over the next year.  In less than eight months, Mary has saved over $100 in extra bank fees and interest charges and tucked away over $1,000 in her savings account. Mary doesn’t go out to eat very often anymore, but that’s OK.  She likes to cook.  For Mary, creating nice things, like meals, helps her to be a better person, all around.

You’ve heard it before, “everything you do and have in life (material things, relationships etc.) either adds value to your life or drags you down.” (author unknown) There is no third option. Things that add value to your life are things that make you happy, lead you to become more creative, healthier, wiser, and more energetic, develop your talents and so on. The same holds true for your finances.

Please feel free to comment, below.  We are open to your tips and ideas for getting rid of financial clutter and eliminating stress.

The Law Offices of Ginger B. Kelly is now accepting appointments to see clients in the Sturbridge, Southbridge, Dudley, Webster, Oxford, Sutton, Charlton, Auburn, Worcester, Framingham, Shrewsbury, Spencer, Brookfield, West Brookfield, Warren, Putnam, all of the Worcester County, parts of Hampden County and Northern Rhode Island.  We can explore whether or not bankruptcy is the easy way out in a comfortable, private place to talk.  We will have a fresh 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, gardening, 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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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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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

Bankruptcy Without My Spouse

Spouses

By Attorney Ginger Kelly, January 24, 2018

Bankruptcy is a great way to get a fresh start, but how will it affect your spouse if you want to file individually? Attorney Kelly investigates a few common questions about dealing with a bankruptcy when a spouse might be involved.

Am I required to file bankruptcy with my spouse?

The short answer to this question is no. If only one partner in a marriage owes debt, then only that partner should file for bankruptcy. Debts where spouses are joint and severally liable for payment will remain with the spouse who has not filed for bankruptcy. The exception is in states that follow community property law.  In community property states, single spouse bankruptcy for joint debts may in some situations be advantageous.

What happens to my credit or property if my spouse files bankruptcy?

As a general rule, one spouse filing for bankruptcy will not affect the other spouse’s credit rating or financial situation. Because a debt is a contract between a debtor and a creditor, each debtor must sign the contract to be liable for payment. The spouse not signing the contract would not be liable for the debt.  This is why the bankruptcy of one spouse doesn’t affect the other spouse or cause the other spouse to become bankrupt too.

What happens to joint debts when one spouse files for bankruptcy as an individual?

Under a Chapter 7 bankruptcy, when one spouse’s debts are discharged, or wiped clean, the creditor can go after the other spouse jointly responsible for the debt.  But, in a Chapter 13 bankruptcy, joint debtor spouses have a major advantage.  When the debtor spouse plans to re-pay his or her debts, over the time of the 3 or 5 year plan, the creditor will generally not bother the other spouse, as long as bankruptcy plan payments are deposited on time.

What are the exceptions?

There are some notable exceptions to co-debtor spouses when only one is filing for bankruptcy. For example, there is a possibility that the bankruptcy of one’s spouse may show up on the other’s credit report, but only if joint debt is involved.  If joint debt is involved, your bankruptcy may affect your spouse’s credit scores.  But not paying the debt will also affect your spouse’s credit scores. Another issue might involve applying for a joint loan in the future.  The bankruptcy of one spouse will affect the creditworthiness of both spouses applying for a loan jointly, or together.

Another exception deals with jointly held property. In a regular bankruptcy, the US Trustee may take non-exempt property and sell it to use it to pay creditors.  Even jointly held property can be taken if not exempted.  This is of vital importance in community property states, states where both spouses in a marriage own and are responsible for all the debt and property acquired during the marriage. The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. Massachusetts and Rhode Island are not community property states but rather, common law property states.

In common law property states, like Massachusetts and Rhode Island, your individual assets and your interest in any property you own jointly with your spouse (typically half unless otherwise noted) are considered part of your bankruptcy estate. In other words, they split the baby, so to speak. But your spouse’s half or portion is protected, generally. The property your spouse owns in his or her name alone is normally not at risk.

However, it is important to know that in Chapter 7 bankruptcy, the appointed US Trustee may be able to sell the entire jointly owned asset if you can’t exempt the value of your interest, provided that the property can’t be divided. If the trustee sells the property, he or she will pay your spouse the value of her interest and use your portion of the nonexempt proceeds to pay back your creditors. This is what I mean by “split the baby.” Keep this in mind.

What if my spouse gets calls and letters from my collection agencies?

Sometimes collection agencies will pursue both spouses even though only one spouse owes debt. If you feel that the calls and letters asking for payment are only meant for your spouse you can do something at this point. First, ask the collector to prove the debt by requesting proof of responsibility for those debts.  If the debt is solely to your spouse’s name, you can ask the collectors to stop calling you or sending you letters, but you must do this in writing (via letter).  If your spouse has already filed for bankruptcy, the collection agency can be stopped if his/her attorney would motion the court and ask to court to enforce the automatic stay.

Can I file for bankruptcy without my spouse knowing?

Yikes! Yes you can, but no don’t do it. Theoretically and in a legal sense, yes, you can file without your spouse knowing. However, because a Chapter 7 uses household income as part of the Means Test, you will need to report your spouse’s income. Also, in some extreme cases, some bankruptcy courts use income garnishment for debt repayment. Since you don’t want your spouse discovering their paychecks have been garnished, after the fact, it’s a really good idea to let them know from the beginning. Hiding bankruptcy is just a temporary solution, at best, and isn’t a good idea. Besides, secrets like this may wreak havoc on a marriage.

When do I need an attorney to file?

If you are considering bankruptcy, it always best to consult with a lawyer. A bankruptcy attorney will advise you to many things critical to your bankruptcy success. For example, fraudulent transfers come to mind.

Just the other day, while waiting for my client’s meeting of the creditors, I couldn’t help but to notice a pro-se debtor speak to the US Trustee at a subsequent meeting.  It’s an open floor.  Everyone can hear what’s going on.  This poor young man did not realize that he made a fraudulent transfer by giving a sum of cash money to his father within a certain period of time before he filed.  Not only can the US Trustee unwind transfers, quite often a discharge in matters like this are not permissible.  I felt sorry for that debtor.  He worked so hard to get to this point on his own, only to be met with a very unsettling outcome.  This is why most debtors need a good bankruptcy attorney.

A bankruptcy attorney will advise you as to whether bankruptcy is your best course of action, based on your situation. Also, your attorney can advise you as to whether or not your spouse will be affected if you file or whether or not they should file with you.

Filing for bankruptcy is a great way to get a fresh start, but it may affect your spouse if they aren’t filing with you. Find out more about joint debt, keeping your spouse’s property and more by contacting a skilled bankruptcy attorney in your local area.

The Law Office of Ginger B. Kelly is a boutique type law firm located in central Massachusetts. 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.

As one client put it, “This is like an old fashioned law office, very comfortable.”

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

Also, keep in mind that it’s tax return season. Many people use their tax refunds to help pay for their bankruptcy.  There is no better time than now (tax refund season) to talk for free and find out more about ways you might be able to get the bankruptcy that you need now.

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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, Collection, credit card debt, Debt, Debt Collection, Filing, Financial, Financial Planning, Joint Property, Law, Massachusetts, Mortgages, Spouse, tax refund, tax return, Uncategorized

Student Loan Debt and What to Do about it

Oh the places youd go if you weren't riddled with student loan debt

By, Attorney Ginger Kelly, November 9, 2017

According to US News, about half of all Massachusetts workers have some sort of bachelor’s degree.  That means high rates of student debt plague our state. But even worse, according to the Boston Globe, over 50% of college students in Boston drop out of college. That leaves even more people strapped by student loan debt without a degree.

When the national average for student loan debt almost reaches the $38,000 mark, it’s no wonder why student debt is becoming truly a national crisis. But where there’s a will, there’s a way. For some college grads, the best strategy is to be aggressive with paying back student loans.

For one college grad, Meghan from Boston, who paid  back her student debt within five years, it was all about prioritizing. “It’s possible if you want it badly enough,” she said. Meghan itemized her debt wish list and named her reasons for wanting to be debt free. Writing down your reasons helps to keep you on your journey. Being able to refer back to those reasons helps to overcome challenges and to remember why you’re making sacrifices.

Another college grad, Jason, felt overwhelmed while trying to pay the minimum on his $45,000 student loans.  So he took a different path and got serious about paying down his student debt. He reviewed every portion of his bank account, tightened spending, worked two jobs, and established a “done with debt” deadline. This helped Jason pay off his student loan debt in less than a year. Jason said that he kept spending very low and worked hard at his corporate job and also side job to pay off debt.

Aggressive payment plans are fine for some, but for those with small children and other priorities, aggressively paying off student loan debt is not always practical or attainable. Never the less, a few tips for grads may be helpful, while keeping in mind that every situation is quite different.

Start saving during the grace period: Use the grace period to review repayment options and figure out what is most affordable for your situation.

Choose a short repayment plan: Try to choose the shortest repayment plan you can afford, if you can do this without eating cat food and borrowing your sister’s car constantly. Although extended payment plans have lower monthly payments, the total interest will more than double for doubling the time.

Pay off expensive loans first, with one caveat: Some financial gurus believe that prioritizing paying off loans with the highest interest rate first is a good idea. But because not all situations are the same, this may not be the best strategy for getting out of debt quickly. Each situation is different. More on this to follow.

Trade your service for your debt: Certain programs, such as AmeriCorps, erase part or even all of a federal student loan. A year of service at AmeriCorps can pay for around $5,645 of your loan. Honestly, I know of no one who paid off their student loans by volunteering in AmeriCorps, but it’s an idea that’s out there.

Keep close contact with your lender: Be sure to tell your lender if you plan on moving or changing your phone number or email address. If they need to contact you but you are unavailable, this could add to your costs. Running the risk of missing payments or other important information is not an option.

Enroll in an ACH direct payment withdrawal option: Enrolling in ACH direct payment withdrawals will not only keep you from missing your payments, it allows for a .25% interest reduction rate for all federal loans and most private loans.

Those are the tips most financial gurus tell us.  However, most folks aren’t going to pay off their student debt by volunteering in AmeriCorps. But it’s an option. Most folks don’t work for in a low paying public service job, nor do they want to. Public service is only an option, not the only path.

Most people, graduates especially, have different types of debt and families with children. People in this category may choose to reduce or pay off their overall debt and just pay the minimum on lower-interest student loan debt until it makes sense to pay this off with a more aggressive student loan payment plan in the future.

*More about paying off expensive loans first: Although this makes perfectly good sense in some situations, the reality of life is that this is not always the best plan. Alternatively, it’s may be a better idea to lower your debt using a different strategy, like zero interest transfer options.

To start on the path to a zero interest transfer option, begin by paying down higher balance debt first and watch your credit scores climb. Then, find one or two zero interest transfer options to get rid of expensive debt and provide more time to pay off overall debt. For a little more in-depth discussion about balance transfer options read,  “When balance transfers make good sense” by Attorney Ginger Kelly.

But it’s not always all about paying down student loans; becoming debt free and more comfortable in your own financial shoes is really about analyzing the total debt you have and working a strategy that makes good sense from a credit bureau point of view.

Total debt to income is what really hurts a person’s ability to feel more confident, secure and to enjoy life a little better. If you want to make a change for the better, maybe get out of your parent’s basement quicker, work on your student loans after trying these strategies. Notice, I did not say simple strategies. They aren’t simple and take time. So be patient. Patience is a virtue, so they say.

1. Lower your total debt to credit ratio: Prioritize personal and consumer loans (like credit cards) to lower your total percent of used to unused credit and really make your credit scores soar. Doing this will lower your total debt to available credit ratio. Having higher percentages of unused credit for all your debt will lower your debt threshold and increase your credit scores. Higher credit scores are what you need to get lower high interest rates or no interest credit card introductory rates with low fee balance transfer options. This plan is not instantaneous (like most good things), but over a year or less many college grads, and people in general, can increase their credit scores 50 to 100 points or more. But wait. Besting your best credit scores isn’t all there is to it.

2. Don’t close old credit card accounts. Then, never ever close old credit card accounts. Keep them, at least for a long while until your 100% confident it makes no sense to have better credit scores. Closing old accounts will damage your credit scores. Damaging credit scores while paying off debt can take you back to square one. Keep old credit cards and move on to the next step.

3. Find zero or low interest balance transfer cards, and use them. With a credit score of 700 or better, don’t run out and finance a new car but rather, find the best lower interest or no interest balance transfer cards by looking, very hard, online. Do the research and find the best deals and then transfer balances from higher interest credit cards to lower or zero balance cards.

Many times, frugal websites like Andy Prescot’s “The Art of Being Cheep”
help with the initial research. Nerdwallet.com and MagnifyMoney.com are also helpful websites. Magnify Money has a great chart on the best balance transfer credit cards and an idea of what kind of credit scores you need to get them.

4. Use the zero balance time to aggressively pay down all revolving debt. With a zero or low interest credit card introductory rate, take this time to aggressively pay down all your credit cards. This will help your credit to grow.

5. Now it’s time to say good bye to student loans. At this point, with better than average credit scores, you have placed yourself in the best position possible to become more pro-active regarding paying down student loan debt. Student debt tends to be the lowest interest debt most people have. So why not make the most of the bargain and aggressively pay down this type of debt last and not first. Manage your debt before you debt manages you.

If there is no way to pay down your debt or debt is managing you, or even killing you, talk to a good consumer debt lawyer or bankruptcy lawyer immediately. Sometimes, they can advise you on which debt to pay first or not and whether or not bankruptcy is an option to explore. Most offer free first consultations.

My advice to people is to find at least three lawyers who offer free first consultations. Visit all three and compare. Pick the lawyer that makes the best sense to you, one that you can talk to, and then stick with that lawyer. Not all lawyers are perfect, remember this. But finding a good adviser who can help you manage your finances and deal with overwhelming consumer and student loan debt is like finding gold when you least expect it.
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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 balance transfers, Bankruptcy, credit card debt, Debt, Empowerment, Financial, Financial Planning, Massachusetts, practical stuff, Student Loan Debt, Trending, Uncategorized

Defending Debt Collections in Court: 6 Amazing Ways to Score Big Time

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Defending Debt Collections in Court: 6 Amazing Ways to Score Big Time

By Attorney Ginger Kelly
October 5, 2017

The New York Times ran a story in 2012 about the outpouring of credit card debt lawsuits being filed. They compared this widespread outbreak to the “robo-signing” fiasco which plagued the mortgage industry in years past. Now it seems the debt collection industry has taken up “robo-lawsuits” and are filing thousands of lawsuits a day all across America, including Massachusetts and Rhode Island. Lawsuits are being filed with the expectation that 99% of all defendants will not answer. In 2017, this is still a big problem.

Lots of people people being taken to court by debt collectors and lenders, many of them don’t owe a dime.  This is the new trend, plaguing thousands upon thousands of consumers in America today.

The biggest problem with these debt collection lawsuits is that about 90% of them are flawed. Debt collectors cannot prove that they are the ones owed the money.  They cannot prove how much money is owed, if any.  This is where consumers must take charge. Knowledge is power. Knowing things the debt collectors wish you didn’t know will often place you in the driver’s seat when it comes to Debt Collection law suits.

1. Start at the Beginning, Answer the Lawsuit.

If a debt collector files a lawsuit against you to collect a debt, you will receive a summons (typically in the mail). Many people ignore these types of summons, because they look like ordinary mail. Within the summons is a complaint. The complaint has a date to respond and instructions on how to file an answer.  Take note of the instructions and, if you like, look for a form to respond to the complaint.  In Massachusetts, Mass.gov has forms that can help you in small claims or in district court.  These forms can be easily filled out. You must remember to respond to the lawsuit, either personally or through your lawyer, by the date specified in the court papers. This will preserve your rights in court. It’s simple and doing maintains your right to challenge the debt in court.

Even if you owe this debt, a two-sentence response denying liability to the lawsuit filed in court will suffice. When you do this, chances are your law suit will likely lead to a negotiated settlement. This will save you money in the long run, because most of the time the debt amount is inaccurate. The number one mistake people make when they are sued is failing to respond to the notice in the complaint.

In your answer, you can simply Admit, Deny or express Lack of Knowledge to each statement made by the plaintiff debt collector. Of course you don’t admit to any statement unless you know it’s 100% true, so be honest. Don’t guess. If you don’t know whether or not, for example, the account number listed is your credit card number, or the debt amount is actually the amount of money owed, deny the claim. The same is true for all the allegations. If you do not understand what the plaintiff is saying, you should say, Lack of Knowledge. Lack of Knowledge simply means you don’t know whether that statement is true or not. Then, take your answer to the clerk of court and file it. Mail a copy to the other side. Ask the clerk the proper procedure for making copies and mailing.  Better yet, don’t bother taking chances or taking the day off from work to file papers with the clerk, talk to your lawyer and bring in the big guns to fight this for you. Pay your attorney to hassle with the paperwork.

Even if you don’t have an attorney, don’t be shy or embarrassed. Filing an answer doesn’t mean you want to avoid paying your debts. It only means you are a smart consumer. It means that you want the debt collector to do his job and prove their allegations against you. In any business transaction, it is always best to be sure that you actually owe the correct amount before paying it. The same applies to debt collection law suits. This is why you file a simple answer.

2. Find Out Who, Exactly, Owns the Right to Take You to Court

The collection agency must prove they have the right to collect this debt, if you ask them. This is their job. Make them work. All collection agencies have a duty to provide good evidence of a transfer of the signed credit card agreement, but only if you ask. If you don’t ask, they have no duty. So, if you ask and the other side does not produce paperwork, you you don’t understand it, ask the magistrate or the judge to dismiss the case.  When the plaintiff does not have the “chain of custody” paperwork giving them the right to collect this debt from you, they lose.

It’s rather enjoyable when a judge or magistrate takes a good look at the chain of custody paperwork many debt collectors provide. Some of them shake their head. Then, they dismiss the case. It’s that simple.

Mass Legal Help is a great website that gives examples of how to answer and challenge a debt collections law suit in a simple and complete manner.

3. Make the Debt Collector Prove the Amount Owed, Why Not?

This is a good one. In most debt collection law suits, there are so many charges upon charges, and fees no one understands, it’s not funny. Make the debt collection agency prove the amount owed by simply asking them to provide the original signed agreement and a balance on the account from zero to the present. If they can’t prove what you owe, the judge will not be able to make a ruling and will dismiss the case.  If they hand you a huge stack of paper, don’t feel threatened.  Either ask for them to show you what the papers mean, or ask for a continuance so you can examine the documents.

I talk a little bit more about this in my article, Debt Collection and 7 Deadly Sins. Take a quick look at point 3. Greed. This may help you.

4. Use the Statute of Limitations, Like a Boss

State law provides that debt collectors have a maximum amount of years they can legally sue you for debt they think you owe. This is different than collections.

A debt collector can bill you forever, but a debt collector cannot sue you in court to collect beyond the statute of limitations period. But again, a person needs to use this as a defense in court for it to be effective. When that statute of limitations period expires, the debt collector will lose if you defend using the statute of limitations. Use this as a defense and get your lawsuit dismissed. If it applies, it works!

Currently, the statute of limitations for almost any type of consumer debt in Massachusetts is six (6) years (MGL Chapter 260 Sec. 2)  In Rhode Island, it’s different.  Under Title 9, in Rhode Island, the statute of limitations for contracts and open accounts (credit cards), is ten (10) Years.  (RIGL 9-1-13(a))

In legal terms, a debt that has exceeded the statute of limitations is also called a “time barred” debt. When, exactly, the statute begins (or begins to toll), is different for different debt and for different state laws.  For credit card debt, typically the statute begins to toll from the date you made your last payment. You can find more info on Time barred debt defenses in Massachusetts in the online Mass law library.

There may be other legal arguments about the statute of limitations, like the conflict of laws and the significant relationships test. But essentially, the statute of limitations for most debt in Massachusetts is six years from the date of the debtor’s last transaction, or payment, on the account. Ask your attorney, if you have any questions and want to know if this statute applies in your case.

5. Sue the Debt Collector, Big Time

If a debt collector has violated any part of the Fair Debt Collection Practices Act (FDCPA), you may be able to sue them and could get a money damage award.  Consumers can successfully sue for violations of the debt collections practices act and are entitled to statutory damages of $1,000, plus punitive and economic damages.

This is where debt collection law suits can be actually quite enjoyable, for me anyway.  For you, maybe not so much.  As a lawyer, this is what I’ve been trained to do.

There’s nothing wrong with finding violations. Holding debt collectors to the higher standard they are called to perform is the right thing to do. Holding their feet to the fire, so to speak, is what’s best for consumers. This is why it’s not a bad idea to hire a lawyer to file a well-drafted answer to the complaint and attend court with you.

6. Explore Bankruptcy, the Fresh Start Option

If the debt you have is more than you can manage or the debt you are being sued for is large, it may make good sense to talk to an attorney. A good bankruptcy attorney will help you discover whether or not filing for bankruptcy is an option for you.

Filing for bankruptcy will keep you protected by the automatic stay, which will halt any and all debt collection efforts being made against you. If you are thinking about filing bankruptcy, talk to an attorney quickly. Don’t wait until the day before you are supposed to be in court. Lawyers can’t typically file bankruptcy paperwork the next day. That’s not how bankruptcies work. Bankruptcies are very paper-work intensive and tedious. To find out more read Bankruptcy, the Easy Way Out, Really? 

While it is possible to successfully defend a debt collection lawsuit, it’s often very difficult and emotionally charged. If the debt collection agency is successful in court, they can get a judgment entered against you. This, in turn, would allow the collection agency to garnish your wages or even go after your bank accounts or place liens on your home, vehicles or other property.

I tell all my clients that debt collection law suits are like traffic tickets. It never pays to ignore them. Reply to the summons. Go to court. What do you have to lose? But better than just “winging-it,” speak to a good bankruptcy and debtor defense lawyer first. Some law offices like ours, offer a free first consultation. When you hire a good debtor defense lawyer to help, there are virtually a hundred or more different defenses that can be used to protect you against garnishments and attachments.

Currently, we are taking defendant clients for debt collection law suits. Our first consultation is free. I’m always happy to meet new clients and am willing to work around your schedule. Exploring your best options with an experienced attorney can’t get much easier. This is only one way we are transforming the way people do business with lawyers.

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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, 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 Bankruptcy, credit card debt, Debt, Debt Collection, Financial, Foreclosure, Hiring Counsel, Law, Lawsuits, Legal, Massachusetts, Massachusetts law, practical stuff, Rhode Island, Student Loan Debt, Trending, Uncategorized