At least the way I measure the economy.
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As long as hotels are empty the economy is not turning around.
Monday, August 30th, 2010The jobless recovery – it is now official even ABC News acknowledges this!
Sunday, July 4th, 2010
The jobless recovery is a reality - this scene of people standing in line for unemployment benefits is bound to repeat.
July 4, 2010 – This morning on This Week on ABC one of the big topics was the “Jobless Recovery.” Finally the media is acknowledging that any recovery that may exist (I dispute that we are in recovery) is a jobless recovery. There was the temporary jump in new jobs in April which turned out to be the census takers and of course those jobs did not last. The show also acknowledged that there will be a double dip recession. I think either we are already in the second dip or it is coming very soon.
I have been saying for quite some time that any recovery will be a jobless recovery. I feel vindicated. The lesson to learn from this is that the powers at be do not care about us will lie to make themselves look good until we do not buy their statements anymore. If you think you will find a new job soon think twice. This may be a good time to file bankruptcy when your means test 6 month income will be at the lowest as someone who is unemployed. Also do not expect a new job soon or if you are lucky enough to get a new job it will probably pay less and be without benefits. Chapter 13 is also available as a good way to save your house from foreclosure and save cars from repossession.
Banks violate the automatic stay if they require payment of overdraft balances in order to open an account
Tuesday, June 29th, 2010
Banks violate the automatic stay when they require you to pay past debts in order to open an account.
June 29, 2010 – Today Judge Isgur of the Southern District of Texas suggested that banks may be violating the automatic stay when they require payment of overdrafts or other debts in order to open an account. He stated that this is a frequent occurrence in his court that debtors are required to pay these balances. He did not make a definite ruling but invited the debtor in a case to file a stay violation lawsuit.
The thing to do is to tell the bank that they are violating the automatic stay, ask for a supervisor, and most importantly ask them to put it in writing then go to your bankruptcy attorney and file the lawsuit. If we as debtors’ counsels get more aggressive the banks will change their behavior. This case involved First Convenience Bank which I recommend clients to avoid because I think they are predatory when it comes to overdraft fees and authorize debit card purchases when there is no money in the account only to charge a $30 plus overdraft fee and let the consumer run up hundreds of dollars before they stop.
Growing minority of bankruptcy judges try to close exemption loophole for debtors moving between states
Sunday, June 27th, 2010
Moving from one state to another sometimes means that you still pack with you the laws of the old state.
Most bankruptcy judges will let you claim the federal bankruptcy code exemptions to keep your property in Chapter 7, even if you moved to Texas less than two years ago from a state that does not allow you to use these exemptions. The reason for this rule is that most of the states that have opted out from the relatively generous federal bankruptcy exemptions have limited their opt-out law to its own residents. A concern however is that a growing minority of judges are ruling that regardless of explicit residency restrictions the old state’s exemption laws apply. This means that if you move from another state to Texas less than two years before filing that state’s law applies and if you lived in more than one state during these two years then it is the state where you lived the majority or greater part during the 180 days before the two years that applies. This may sound complicated, but I do this analysis all the time as many of my clients have recently moved from out of state.
Attached is an opinion from Judge Marvin Isgur that is an example of this troubling trend. The solution is to get a bankruptcy attorney who does not mind anaylizing your rights under another state’s law in case you end up with a judge who takes this position. I have found though that most of the time there is little resistance to claiming the federal bankruptcy exemptions, but in cases where there is a lot of property caution should be exercised in case you end up with a judge that takes this position.
While there is criticism of our nation’s broadband policy, it’s still deductible in the bankruptcy means test.
Saturday, April 3rd, 2010In the March 29 issue of InformationWeek its editor in chief Rob Preston argues that our broadband policy is wrong as a country and we should let the marketplace rather than government mandates help expand broadband. He says that our marketplace has made us number 3 in broadband readiness and that other countries where the government has taken a role are not doing well.
Do go and get high speed internet because it is deductible in the means test as a telecommunications expense. Anything above basic phone service that is necessary for you or your family’s health or welfare is deductible. Broadband is important to use for job search and dial up internet is too slow for most uses these days. Additionally with dial up only one computer can be on the internet at the same time. If you get a wireless router for about forty dollars then you and your spouse can be working on job searching on two different computers while your kids are doing there homework from school online on theirs all at the same time. Become part of the 21st Century telecommunications revolution and deduct it on the means test.
Health Insurance CEO: Premiums will go up – Still deductible in bankruptcy means test
Saturday, April 3rd, 2010In the April 5 issue of Bloomberg Businessweek, Aetna CEO Ron Williams was asked if premiums would go up as the result of health care reform. Williams said that absolutely they would go up and “some” of the things driving those are the additional taxes on the industry.
That was the bad news your health insurance premiums will go up, but they good news is that they are still deductible in bankruptcy in the means test. In Chapter 7 you can buy health insurance right before filing or if your premiums go up under both situations and still deduct the new higher amount in the means test. For those in Chapter 13 you can even buy it after you file and count the increased amount as an expense deduction.
Supreme Court rules that Chapter 13 plans that discharge student loans are binding even if there were legal errors in the process
Saturday, April 3rd, 2010Recently in United Student Aid Funds v. Espinoza, 08-1134, the Supreme Court Ruled that a Chapter 13 plan is binding on a creditor with actual notice even if it is legally defective. In Espinoza the Court ruled that the plan was binding even though a separate lawsuit should have been filed. The main lesson for creditors and benefit for debtors is that confirmed Chapter 13 plans are binding even if there are procedural irregularities. This is good for us!
More foreclosures in 2010 and more drops in home prices
Saturday, February 6th, 2010Mark Zandi, Chief Economist at Moody’s Economy.com and former advsier to presidential candidate John McCain said today that the foreclosure prevention intiatives have been ineffective and that we will see more foreclosures in 2010, on C-SPAN at a forum by the Urban Institute. He also said that this will cause a drop in home prices.
Additionally Zandi also said the overalll outlook for the econony is not good. My opinion is that Zandi is right. The press and the politicians have been trying to convince us that things are getting better while we all see that things are getting worse. Zandi is courageous to tell the truth that things are not getting better and that these so called mortgaqe modification programs are not accomplishing anything. It is time that Congress give bankruptcy judges the power to modify home mortgages of debtors’ primary residences.
Do make charitable donations before and during your bankruptcy
Wednesday, January 20th, 2010Many of us tithe to our churches and give money to the Red Cross such as for Haiti earthquake relief. The good news is that the Bankruptcy Code protects these donations as long as they are 15 percent of your annual income or less.
As long as your donation is to a religious or charitable non-profit organization it is protected in several ways. In Chapter 7 it does not count against you on the means test, it will be deducted from your “disposable income” as long as you intend to continue the donations every month.
A Chapter 7 trustee also cannot void charitable gifts with the 15 percent limitation. In Chapter 13 you can continue to give up to 15 percent each year during the case and it cannot be held against you. It should be listed in your budget. In short continue exercising your faith and enjoy the pleasure of giving. It is better to give than to receive!
I will be on CNN Radio this Saturday – Bankruptcy and Credit Scoring www.cnn650.com
Saturday, September 26th, 2009I will be on CNN Radio, 9 am CT, this Saturday, on Bankruptcy and Credit Scoring. Tune in at www.cnn650.com or 650 AM in Houston.
