Atlanta Bankruptcy Attorney Blog

The Wall Street Journal recently reported that there are ways to avoid the psychological damage done when collection agencies continue to badger people to collect debt.

Our Atlanta bankruptcy lawyers would argue that one way to avoid the headaches of collection agencies and their representatives is to avoid them altogether.

Filing for bankruptcy in Atlanta immediately stops collection agencies from bothering you. Once you file, they are alerted to cease communications with you and direct their communications with the court.

The whole purpose of filing for bankruptcy is to eliminate debt. But there are other benefits that can make filing worthwhile. Stopping wage garnishments, ending the countless calls and e-mails and other bothersome alerts can make life much easier for those who are in debt.

Banks and other lenders are ruthless when it comes to collecting what is owed. They don't care what damage they are doing. The collections agencies are paid to get money and the lenders want to be paid. It's a bad cycle that doesn't end until you pay up or you file for bankruptcy.

These companies rarely want to listen to debt management solutions, payment plans or cutting back on how much you owe them. Like the banks and foreclosures, the credit card companies and other lenders are interested in maximizing profits and it doesn't help when they could stand to lose money.

A recent Wall Street Journal article looks at alternative strategies to limiting the damage done by collection agencies. It follows the story of a New York man, a struggling musician, who would get 40 to 50 automated calls a day.

His solution was to by a caller ID box with a ring controller. It gave him peace while he negotiated a 69 percent reduction in the $54,000 in credit card debt he owed. The story was on the heels of the continued decline in consumer credit, which has gone down nearly every month since September 2008.

While this man was able to cut down debt after he stopped paying and instead of paying 50 cents on the dollar, he got them down to 31 cents on the dollar. But many others aren't so diligent. A lot of people get warn down by continued calls and the harassment that debt collectors are known for bringing.

People sometimes decide just to make a minimum payment just to shut them up. This just leads to a higher amount of debt, higher interest rates and hidden fees that further cripple the person's finances.

Some people instead go running to debt relief companies or debt management companies that promise to work on their behalf. But these companies are no more likely to make a dent in the debt than the consumer and they don't work for free. These companies would charge up-front fees of 15 to 20 percent of what is left outstanding, which could be a huge amount of money to pay for little help. They were recently banned from charging up-front fees.

All these rip-offs won't help. But there's a good chance that filing for bankruptcy in Atlanta will. Depending on the consumer's income level, how much they owe and other information, they can get all or most of the debt cleared without having to pay it back. These laws are designed to help the consumer who has gotten in a bad debt situation.

Continue reading "Avoid Psychological Damage From Collections By Filing for Atlanta Bankruptcy" »

As Atlanta Bankruptcy Lawyers reported earlier this month, bankruptcies nationwide are dropping, which many people would consider great news and possibly an indication that the economy is improving.

But as unemployment continues to stay high -- higher in Georgia by about 1 percent than the rest of the country -- fewer filings of bankruptcy in Atlanta isn't a good sign at all. What experts believe is that credit card companies and banks have lowered their standards by extending lines of credit to struggling consumers, which is simply going to make their situation worse.

Newly released statistics show that while Chapter 7 bankruptcy filings have dropped during the first seven months of 2011 compared with the same period in 2010, Chapter 13 bankruptcy is actually on the rise. Statistics from the U.S. Bankruptcy Court for the Northern District of Georgia, which includes areas from Atlanta, Newnan and Gainesville in the south, to Rome in the north, show that more people are shifting away from Chapter 7 bankruptcy and toward Chapter 13 bankruptcy.

In 2010, 19,843 people filed Chapter 7 bankruptcy between January and July, down to 17,487 this year. That's about a 12 percent drop. But for Chapter 13 filings, the number has spiked about 10 percent from 11,291 in 2010 to 12,584 this year.

In both forms of bankruptcy, the consumer's debts can be discharged, offering him or her the same kind of freedom that others who finish the process enjoy. In Chapter 7, consumers can get a complete discharge of their debts after the process is complete. Chapter 13 bankruptcy works differently, but with the same result.

In Chapter 13, a person must set up a payment plan, usually over three to five years, with reasonable monthly payments to pay back creditors and lenders. After the payments are completed, all remaining debt is discharged and the person is through with those debts. Typically, Chapter 13 is designed for people who have assets such as a home that they want to try to protect. They are allowed to keep their assets, which is also the case for many people in Chapter 7 bankruptcy as well.

For those who are unemployed and have few prospects of getting a job, they are looking for a lifeline. If a credit card company offers a new line of credit, that's exactly what they seek to help them get by. Sadly, this is just going to push them further into debt while they hold out hope that a new source of income may be coming.

Even if they are fortunate enough to find work, they are now saddled with even more debt that likely outpaces their income. But many people simply rack up credit card bills and are hit with unrealistic interest rates and hidden fees. These are typical tactics by credit card companies to make money off the consumers who keep them in business.

So, it's not surprising that people are seeking ways to get help from these credit card companies. Bankruptcy is one of those ways to help. If you are in such a situation, find out what your options are today.

Continue reading "Chapter 13 Bankruptcy in Atlanta Increases in 2011" »

More bad news out of Atlanta, this time from The Atlanta Journal-Constitution -- the newspaper reports that the metro area's unemployment rate went up again in August, from 10.3 to 10.4 percent.

That may not seem like a big jump, but what it shows is that the local economy, like the national economy, isn't getting any better. Layoffs in construction, food services, accommodations, trades, and administration and support staff have left people scrambling for jobs.

Unemployment continues to negatively affect the U.S. economy, and the Great Recession is leaving some people to think about a future with less money or even a complete lack of income. For many consumers, it's a matter of trying to get by, as they are attempting to pay back bills with side jobs, selling assets and taking advantage of other strategies.

But this probably isn't working. They are slipping further and further into debt as interest rates increase, making minimum payments on purchases that result in the merchandise or service being even more expensive, and for some falling behind on mortgage payments. Unfortunately, this situation often leads to foreclosure in Atlanta. But these people should take the time to consult with an experienced Atlanta bankruptcy lawyer who can explain the benefits of bankruptcy and the options consumers have at their disposal.

Bankruptcy laws are some of the only laws that are designed to help protect the consumer. They were enacted in order to give people a second chance after experiencing unforeseeable problems such as job loss, overwhelming medical expenses, predatory lending practices, or poor spending habits. All of these situations could be relieved through bankruptcy.

Mounting debts can be discharged, for instance, and those who own a house can often stay in their homes while the process is ongoing. In many cases, a person can have all of his or her debts relieved, making it possible to move on with life after the process is completed in much better shape than when they filed.

According to the newspaper, Clayton County had the highest jobless rate at 13 percent in August in the area. Clayton County is followed by Fulton County at 11 percent, DeKalb County at 10.8 percent, Cobb County at 9.6 percent and Gwinnett County at 9.3 percent.

In the city of Atlanta, the jobless rate was 11.7 percent, which was up slightly from 11.5 percent in July. Statewide, the jobless rate is 10.2 percent. This is the 49th consecutive month that Georgia has exceeded the national unemployment rate, which stands at 9.1 percent.

Not having a job can be terrifying, and it's obvious that little is being done to bring new companies and new jobs to Georgia. It is painfully apparent that citizens here continue to struggle to find employment opportunities, while residents of some other states may have more choices to find meaningful work.

Many people choose to try to squeak by with minimum payments, while dealing with hounding collection agency workers and harassing bank officials. But there is a better way through bankruptcy, which stops creditors from calling while the process is ongoing. And after debts have been discharged, the consumer can again live his or her life free from the debt that has trapped them for much of the last few years.

Continue reading "Atlanta Bankruptcy an Option as Georgia Jobless Rate Increases" »

So far this year, bankruptcies have fallen about 8 percent nationwide, but experts don't believe this is cause for celebration, The Atlanta Journal-Constitution reports.

Filing for Chapter 7 bankruptcy in Atlanta can be a difficult decision, but clients of Atlanta Bankruptcy Lawyers have found that going through with the process brings with it a sense of freedom from bills, creditors calling and the frustration of living with debt.

For many people, they won't even consider filing for bankruptcy and instead choose to open up another line of credit or get another credit card that puts them even deeper into debt. The interest rate is probably in the high 20s and even making one late payment is disastrous. To those people, Atlanta Bankruptcy Attorneys would encourage setting up a free consultation just to look at the options and see what can be done to help the situation.

According to the newspaper article, some people consider a drop in bankruptcy filings a positive sign that with a national credit downgrade, labor and housing woes, an up-and-down stock market and other frustrations, consumers' credit is actually doing better.

Not so, however, experts say. Many believe that bankruptcies may be down simply because people can't afford the filing fee and because creditors are appling less pressure. The article suggests that there are many people on the brink of bankruptcy, but are hoping that an economic uptick can keep them from filing. If the economy doesn't turn quickly, those people may be forced to file.

Georgia State University law professor Jack Williams told the newspaper that there's no proof that bankruptcy filings have dropped because the individual consumer is in better shape financially.

"The economy hasn't turned," he said, "and, if anything, it may be going back down."

Filing for bankruptcy can cost a few thousand dollars. Some believe that when more people are employed, they will be able to afford to file for bankruptcy protection.

Some people may make too much money to qualify for Chapter 7 bankruptcy, yet can't afford payments under Chapter 13 bankruptcy in Atlanta. These people may be "stuck," the article suggests.

Under Chapter 7 bankruptcy, a person's debts are discharged after going through the process of filing and working with court officials. Chapter 13 bankruptcy, however, allows a person to keep larger assets, such as a house, and make payments to lenders. Consulting a bankruptcy attorney in Atlanta will permit you to make an informed decision about how to best handle your unique financial situation.

Bankruptcy is a complex process and there are many variables that can affect the outcome. While it may be true that people are having a tough time affording the filing fee and other associated fees, others recognize the benefits and have put together enough money to enjoy the benefits of bankruptcy.

Setting up a free consultation to discuss your situation is the first step. It's possible there are alternatives to bankruptcy that can help ease the situation of dealing with the burden of debt.

Continue reading "Atlanta Bankruptcies Dip, But That May Be Bad News" »

A new report from ForeclosureDataOnline.com shows that Georgia led the nation in the increase of foreclosure listings between March and April -- 7 percent.

As the local market is continuously flooded with foreclosed homes, it is further proof that home values will continue to drop. This is another important reason for homeowners to consider bankruptcy in Atlanta if they are pouring every last bit of their savings into an upside down mortgage. If you find yourself in this situation, set up a free consultation with Atlanta Bankruptcy Lawyers to determine what may be your best option.

According to the report, there were 3,575 foreclosure listings in March, which climbed to 3,828 in April, a jump of 7.08 percent. Closest to Georgia was Colorado, where foreclosure listings increased 6.62 percent. The Atlanta area saw a 28.9 percent increase, while Marietta foreclosure listings rose 23.6 percent. In Douglasville, listings increased a staggering 129.3 percent.

As the number of foreclosed houses flood the real estate market, those houses are getting deeply discounted, USA Today reports. According to the article, foreclosed homes are settling at a 27 percent discount compared to non-distressed properties nationwide.

All this goes to show that the American homeowner is in a precarious situation. Many homeowners are upside down on their mortgage because the value of their home has plummeted in the midst of the foreclosure glut. They are now stuck in a house that is worth far less than what they are paying for it.

And some are struggling to make payments, sinking thousands of dollars they have been saving for the future into houses that may take years or decades to recover in value.

For those who want to stay in their homes, simply threatening to file for bankruptcy could bring a bank or lending institution to the negotiating table if the homeowner is seeking a loan modification. Normally, banks are unwilling to modify loans because it isn't as beneficial as simply going through the foreclosure process and seeking a deficiency judgment against the homeowner.

But filing for bankruptcy, if the homeowner is concerned about losing his or her home to foreclosure, can help eliminate debts associated with property. Filing for bankruptcy immediately stops the foreclosure process and stops creditors and collection agencies from calling and bothering homeowners.

Getting this type of protection and being able to eliminate debts associated with an upside down mortgage can give people a very freeing feeling. Atlanta Bankruptcy Lawyers have been able to help many homeowners stuck paying for houses that won't increase in value by filing for bankruptcy and clearing away their debt.

Millions of people have taken advantage of these laws and have gotten out from under a house that is draining their finances and, in turn, harming their family's future. Contacting our firm for a free consultation to determine if this is a good option for you is the first step. Don't continue throwing away your money on a house that isn't worth what you're paying.

Continue reading "Increase in Georgia Foreclosures Lead Nation, Keep Home Values Down " »

The Atlanta Post is reporting that professional athletes are not immune to the pressures of debt and often seek bankruptcy protection in Georgia and elsewhere following their retirement from professional sports.

If those making millions are not immune, it's little wonder struggling hardworking families are filing in record numbers. In a previous post on our Atlanta Bankruptcy Attorney blog we reported that 19,588 Georgia consumers filed for bankruptcy protection in the 4th quarter of 2010.

A CNBC report found that in the NBA over 60 percent of players went broke within 5 years after retiring; a Sports Illustrated article in 2009 reported that within 2 years after leaving the game 78 percent of NFL player will be financially distressed or bankrupt.

Here is a look at a few former athletes' financial situations:

-A former heavyweight boxing champion earned $400 million, when he filed for bankruptcy in 2003 he was $27 million in debt.

-A former MLB player filed for bankruptcy when he had $700,000 to his name, but was in debt for $1.1 million.

-A former NBA player lost his $60 million in earnings paying for 7 children, 3 ex-wives + 2 former girlfriends with whom he had fathered children. Another earned a total of $87 million during his playing days. Last year, he filed for bankruptcy with a debt of $4 million dollars.

-A former NFL player filed for bankruptcy during his jail term for dog fighting. He had previous earnings close to $200 million.

Recently The Atlanta Journal-Constitution reported on an ex-MLB player who was charged with committing a bankruptcy crime. He filed for bankruptcy claiming to be $31 million dollars in debt with only $50,000 in assets. Federal prosecutors allege after filing, he destroyed, hid or sold over $400,000 worth of items taken from his $18.5 million mansion.

A bankruptcy attorney will advise you to never lie regarding your list of assets on your bankruptcy petition. You will be in a lot of trouble if your trustee finds out items have been sold or omitted. It is actually a crime to intentionally not disclose your assets.

Filing for bankruptcy does not wipe out all of your financial duties. It is meant to free you from most or at least some of your debts, leaving you more money to pay the others. Some financial obligations could even be restructured to making them more manageable. In general, debts like taxes and student loans must still be repaid, while unsecured debt from medical bills and credit cards can be completely forgiven in some cases.

Continue reading "The Pros Struggle with Bankruptcy in Atlanta, just like Other Consumers" »

Consumer spending has been rapidly on the rise in 2011. That means the economy is rebounding, right? Well...not exactly, say Atlanta bankruptcy attorneys.

It turns out that most of the increase is actually due to - you may have guessed it - higher gas prices. Prices at the pump saw record increases in the past couple months, and it's only predicted to get worse. Talk about bad timing - economic growth was just starting to pick up in the last quarter. So how are we supposed to get back on our financial feet when prices keep going up?

Continue reading "Atlanta Consumers Spending More, But Higher Gas Prices Play a Part" »

Has grocery shopping been leaving you with sticker shock lately?

You're not imagining things - food prices are creeping upward thanks to a variety of factors, from higher oil prices to rotten weather. To make matters worse, most Americans are still reeling from the recession and dealing with debt. Today's rising food and gas prices can feel like the last straw. But while we can't exactly cut food out of our budget, we can lower costs, say Atlanta bankruptcy attorneys.

Continue reading "Atlanta Consumers Battle Rising Prices At The Supermarket" »

American consumers say the economy has changed their spending habits for the better - but is the change permanent?

While 63% of people in last year's Citigroup survey reported that the recession has had a positive effect on their spending and saving behavior, only 52 respondents say the same today. Perhaps now that incomes are rising once again, we feel a little more secure. And maybe some of us are so used to the new economy that we've become numb to possibilities that once struck fear into our hearts - like pay cuts and layoffs. That's understandable. What's not so understandable? The fact that consumer debt is increasing, say Atlanta bankruptcy attorneys.

Continue reading "Are Improved Financial Habits Falling By The Wayside As Economy Picks Up Steam?" »

Forget a box of chocolates. The best present you can give your significant other this Valentine's Day is your faithfulness - financial faithfulness, that is, say Atlanta bankruptcy attorneys.

Relationships these days are just as likely to be damaged by financial cheating as by adultery. According to the Minneapolis Star Tribune, more than 50 percent of people report buying something their partner didn't approve of - and 30 percent admitted to hiding said purchase. It seems that when the economy took a nosedive, so did honesty.

None of us get married with the vow, "until debt do us part." So how is it that so many of us are ending up with deep, dark financial secrets?

Continue reading "Is Hidden Debt Taking a Toll On Your Marriage?" »

Atlanta residents might not be looking forward to paying taxes on April 15. But hey, at least Georgians don't have to worry about a state income tax increase like the ones in California and Illinois - and potentially a handful of other states with major budget gaps.

That said, paying an ordinary tax bill is no cakewalk in today's economy. On the one hand, many Americans will save a little bit of money thanks to the Social Security payroll tax cut President Obama signed last December. On the other hand, years of tough financial times and growing debts are really starting to take a toll on U.S. consumers, say Atlanta bankruptcy attorneys.

Continue reading "Many Americans Will Struggle to Pay Taxes Amid This Year's State Income Tax Hikes" »

How can you help others when you can barely help yourself? It's a question on the minds of many Americans as we pass the Salvation Army red kettle and toss the requests for donations that pile up in the mailbox this holiday season.

But there are ways to give to charity even when times are tough, say Atlanta bankruptcy attorneys. Just ask the nearly two-thirds of Americans who plan to donate before the year is out, despite tough economic times that make paying the mortgage and credit card bills extra difficult. Even though more than 80 percent in a recent survey said they have the same amount or less money than last year, more than 70 percent say they will give the same or more as last year. So how do they do it?

Continue reading "Atlanta Residents Still Find Time and Money to Donate to Charity Despite Downturn" »

What would you do with an extra $1,000 or more a year? You might be about to find out.

Part of the tax plan between President Obama and Congressional Republicans includes a 2 percent cut in Social Security payroll taxes. So if you're making $60,000 annually, for instance, you'll get to keep an additional $1,200 of your income each year. In the great scheme of things, it might seem like a fairly insignificant amount - but it depends on how you use it, say Atlanta bankruptcy attorneys.

Continue reading "Tax Cut Agreement Could Help Atlanta Workers Lower Debt" »

They say home is where the heart is - maybe it's time to put our money there, too. At least, that's the theory behind Small Business Saturday.

Never mind that the campaign, which starts today, is backed by credit giant American Express - who happens to be offering an incentive in the form of $25 credit to the first 200,000 folks who register their AmEx cards on the SmallBusinessSaturday.com. It's a way to pump money into the local economy - and in theory, back into our own bank accounts. And that's good news for those of us with debilitating personal debt, say Atlanta bankruptcy attorneys.

Continue reading "Atlanta Consumers Encouraged to Shop Local and Save Money Today" »

Nobody likes to make mistakes. But making a blunder now and then - or taking note of someone else's - can actually help improve your finances.

At Money Talk News, author Stacy Johnson recently talked about the lessons she learned from her many money mistakes - including one particularly relevant to the recession. Like many folks, she once panicked and sold her investments during an economic downturn - and lost money in the process. When this latest recession rolled around, however, Johnson did the opposite of what most of us are doing - and it paid off.

Continue reading "Atlanta Residents Can Lower Debt By Learning From Money Mistakes" »