Published Friday, March 5, 2010 @ 4:30 pm

Life after bankruptcy is beautiful thing. Your stress levels go down and you become more confident with money. Now that things are back on track, maybe it is time to take a whole-life approach to changing the way you live. For some, it’s a new, but smaller, home; a more economical car; or a strict monthly budget. For others, re-starting your life may include relocating. Boy, that sounds like a big decision, huh?

So if you have a new financial outlook on life and think it’s time to move, where would you go? Thankfully, our friends at Forbes.com have researched a list of the best cities in America for “getting ahead.” Their research was based primarily on areas that have good job growth and income growth and a relatively affordable cost of living. Call U-Haul, because here are some of your options, in no particular order:

Like Winter? Well, if so, point the GPS toward Delaware County, Ohio. The home county of Columbus has a three-year income growth of 11 percent and is the fastest growing county of the state. Forbes tells us it has a wide variety of jobs and a number of grounded, family-oriented neighborhoods that help prop-up a stable workforce.

If you don’t mind the rooting for the Texans over the Cowboys, Fort Bend County, Texas, outside of Houston, realized 10 percent job growth between 2007 and 2008 and added just under 6,000 jobs since the middle of 2007. A large portion of employees can be found working in energy companies but it’s diverse enough for people to find opportunity in education and hospitality. Many members of Forbes’ 400 Best Big Companies reside in Fort Bend County.

Another relocation is near Frank Sinatra’s kind of town. No, not Vegas. Chicago. Outside of where the wind blows is Kendall County, an area that experienced a 90 percent population increase from 2000 to 2008 and as a result, a seven percent jump in income. You can find another attractive option near Chicago in Will County, Ill., which in 2007 and 2008 saw its residents’ income climb by seven percent.

A bit north, you can settle in balmy Carver County, Minnesota where income jumped by five percent for the same two years. Carver is close to Minneapolis, one of the Twin Cities along with St. Paul which are consistently present in many “Best Places to Live” lists.

If the Midwest or Lone Star State do not appeal to you, head just north of the Triangle to Hanover County in Virginia, an area which saw its per capita income also grow by five percent.

Drive by an ever-expanding government, other regions in Virginia that made the list include Loudon and Alexandria Counties. However, even with the income growth, these areas are very expensive in which to live. Thus, their presence on the list is somewhat questionable because for the most part, to get ahead in Alexandria County, you need to already be ahead.

Relocating can be an expensive endeavor. If you are lucky enough to have a new employer cover some costs, then terrific, you are already on your way. The key is to start planning early and do not rush. After all, it’s not like the real estate deals are going anywhere.

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Published Monday, February 1, 2010 @ 2:14 pm

One thing you may already know about most court proceedings, is that parties usually have the option to represent themselves without the aid of an attorney. This is called appearing ‘Pro Se’, which, in Latin means “for oneself”. In a bankruptcy proceeding, when money is tight, the thought of saving money by cutting out attorneys and their fees can be pretty tempting. But there are many reasons this is a bad idea.

Bankruptcy can be complicated and bankruptcy judges are a picky bunch. They expect that the preparation of the voluntary petition, schedules, or other documents will be done accurately and on time. A bankruptcy attorney can usually prepare the documents in much less time than it would take for you to figure it out on your own. He or she knows what items of personal property should or should not be included on the petition to avoid a dismissal of your case, and how to apply the Means Test to your situation.

Some courts may give pro se applicants some minor concessions or leeway so that the case can be moved along, but they are careful to avoid crossing the threshold of what may arise to the level of the Court doing the job that a litigant – or his or her counsel – should be doing. Also, many different communications are exchanged between a party and the court, the trustees reviewing the petition, as well as the creditors. Your actions, or lack thereof, during this time, can seriously affect the outcome of your petition, and may even lead to the worst outcome- a dismissal of your case.

Normally, when you retain an attorney to handle a bankruptcy, the attorney will contact creditors on your behalf and attempt to stop any embarrassing, annoying, or even harassing debt-collecting activities. Usually this stops the behavior, even though legally, the creditor still has the right to contact you. He or she can also give you advice on seemingly innocuous activities that could negatively impact your case, such as drawing on retirement funds to pay bills.

Then there is the significant issue of knowing the law. Since there are several sets of rules governing bankruptcy proceedings, trying to navigate all the rules at once can get very confusing. All parties to any bankruptcy proceeding must comply with the Local Bankruptcy Rules, the U.S. Bankruptcy Code and the Federal Rules of Bankruptcy Procedure. Failure to do so will result in dismissal of the case or other sanctions. Other important aspects of law can come into play at any time during this process as well, such as statutes of limitations, transfer of assets, or tax issues that can have a big impact on your proceedings as well.

Finally, many bankruptcy proceedings are entangled with other legal issues, such as divorce, civil court action, or foreclosure, which could affect the outcome of your bankruptcy proceeding, and vice versa.

Before deciding to gamble with your future, talk to an experienced bankruptcy attorney about it. You will find the cost well worth it.

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Published Wednesday, December 9, 2009 @ 12:28 pm

Filing bankruptcy, among other things, is about getting a new start. Few things can match the sense of relief that follows even the first phone call to our office, let alone the day you know for sure that your bills are gone forever.

For some, starting over may mean leaving behind everything that contributed to your old spending habits, the material goods, the car, even the house, that led you deep into the financial abyss. If that sounds like you, maybe it’s worthwhile to consider a relocation, not just a downsize.

Know that moving is expensive. So yes, you’ll have to save money. That takes time, and yes, more money. But the most important question is, of course, where to move? Thankfully, the folks at Forbes.com have assembled us a list of places that get the Best Bang-For-The-Buck when relocating. Here is how they broke it down:

Forbes examined markets that at one time were considered second to the most popular regions during the boom times. For example, at one time, homes in Orlando and Las Vegas were flying off the lots. Developers went nuts and inventory was quite high. Now? Well, not so much. Home values are depressed and the foreclosure rates are at the top of the list.

Home prices are down 29 percent from 2006, making areas that never really experienced the boom that much more affordable. And, with a solid employment base, consisting of families who have roots in the area, as opposed to transient corporate workers who ship out every couple of years, places like Des Moines, IA and McAllen, TX are nice places for those looking to get a solid re-start.

Don’t want to move that far? Try Greenville, SC or Chattanooga, TN, which made the list at numbers 20 and 8, respectively. Because the boom avoided these areas for the most part, home values stayed relatively even, as did jobs.

If you must know (why else are you reading this post), Omaha, NE was at the top of the list. Forbes researched the 100 largest MSAs (Metropolitan Statistical Area), examining foreclosures as a percentages of home prices; apartment vacancy rates; unemployment figures; three-year job forecast; three-year home price forecast; housing affordability; median real estate taxes and commuting time.

Here is the Top 25 cities that offer you the Most Bang-For-The-Buck:

1. Omaha-Council Bluffs, NE
2. Little Rock-North Little Rock-Conway, AR
3. Jackson, MS
4. Des Moines-West Des Moines, IA
5. Augusta-Richmond County, GA-SC
6. Wichita, KS
7. McAllen-Edinburg-Mission, TX
8. Chattanooga, TN-GA
9. Colorado Springs, CO
10. Ogden-Clearfield, UT
11. Scranton–Wilkes-Barre, PA
12. Columbia, SC
13. Harrisburg-Carlisle, PA
14. Provo-Orem, UT
15. Syracuse, NY
16. Baton Rouge, LA
17. Buffalo-Niagara Falls, NY
18. Palm Bay-Melbourne-Titusville, FL
19. Tulsa, OK
20. Greenville-Mauldin-Easley, SC
21. Raleigh-Cary, NC
22. Pittsburgh, PA
23. Knoxville, TN
24. Louisville-Jefferson County, KY-IN
25. Youngstown-Warren-Boardman, OH-PA

You may note that a number of the cities are from regions away from the coast, as those regions tend to experience serious market growth in a fast-moving economy. You may notice too that there is not one California city in the Top 25. In fact, there is only one in the Top 50.

Cities in the mid-west, west and industrial regions of the east tend to hold a particular attraction to folks looking to find affordable homes and jobs. Many places in the west offer outstanding recreation and service industry jobs as well cities that cater to the younger, live-life-with-less crowd that is continuing to grow in the midst of a Wall Street-driven recession.

Whereever your final destination, remember that http://www.billsbills.com/bankruptcy-blog/ is always as close as your Web browser.

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Published Sunday, November 22, 2009 @ 12:37 pm

Does anyone else find it just a little ironic that the two most commonly used bankruptcy options are lucky number 7 and the unlucky number 13? You have to wonder just a little bit if that is fates way of trying to send you a little message…

There are actually six different types of bankruptcy which a person or corporation can file: 7, 9, 11, 12, 13, and 15. More often than not most people will just be looking at filing for either 7 or 13. The tricky part can be in figuring out which one is right for you.

The figuring out part is what you pay your lawyer for, but for something like this you are better off having enough knowledge to be considered dangerous- meaning you know enough to pose the right questions to your lawyer and understand what he or she is saying.

Both Chapter 7 and 13 allow you to get rid of your unsecured debt, meaning all those credit cards you have been living off of will be history. A Chapter 7 is a more immediate bankruptcy discharge, while a Chapter 13 will take a few years to complete The trick there is figuring out whether or not you make more or less than the state average income for a family of the same size. If your income is substantially above the median income, you may have some trouble qualifying for a Chapter 7. If, however, your income is more modest, and you simply need to unload your unsecured debt, Chapter 7 might be the best option.

If you do not qualify for 7, Chapter 13 may still be a great option. A Chapter 13 allows you to get caught up on missed mortgage payments, which can help you stay in your home. It also allows you cram down on undersecured car loans, substantially lowering your monthly living expenses. If you have more equity than can be protected under state exemption laws, Chapter 13 lets you keep the non-exempt property (not possible in a Chapter 7). If high income disqualifies you for a Chapter 7, your disposable monthly income will be determined by the bankruptcy code. After crunching the numbers to see how much money you have left after expenses, the court will decide how much you have left to go towards unsecured creditors. Keep in mind, the majority of Chapter 13 filings do not require any repayment of unsecured debt.

It all depends on your unique situation. If you are like I was and drowning in debt without much of anything to show for than Chapter 7 will be the thing for you. Starting over is probably what you need anyway. If you are still treading water, trying to keep up with your secured debt, than you may want to consider filing Chapter 13. This will get you back on track with your mortgage, and may bring your car payments down. A Chapter 13 also gives you breathing room from debts that won’t go away, such as non-dischargeable student loans, putting them on hold until you complete your plan period.

Talk to an experienced bankruptcy attorney today to discuss your options. In North Carolina, contact the Law Offices of John T. Orcutt at 1-800-899-1414. Always a free first consultation

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Published Thursday, November 5, 2009 @ 10:33 am

Bankruptcy is often filled with as many financial ups and downs as it is emotional ones. A fear of an uncertain future, the unfortunate stigmas about having to file, and the very real dose of reality can certainly be downers.. There is no shame in feeling depressed about your financial struggles. Trust us, you are not the only person feeling that way.

Much like contacting an attorney and filing bankruptcy will eventually relieve your financial troubles, there are a lot of things you can do to stop the emotional setbacks you might face during or after the process.

Experts on happiness, or psychologists really, encourage people to find and explore “their passion.” Sounds corny, sure, but give it a shot. A meditation specialist in Woodacre, CA inspires in her clients a sense of calm by asking them to become aware of the “right now.” By this she means honestly taking the time to assess where you are and what is happening around you. Do you have a roof over your head? (Almost all bankruptcy filers can keep their home.) Do you have loved ones nearby? Is your dog happy to see you? You know, the little things.

This theory is further supported by a university specialist in Wisconsin, Lori Hilt, who adds, “When we get caught up in cycles of brooding and worrying, our minds are stuck in the past or the future.” So focus on the now in order to move forward.

Humor also adds a great deal of levity to emotionally overwhelmed people. Try a night out at a local comedy club or just rent some great stand-up routines on DVD. (If you can’t laugh at Bill Cosby: Himself, one of the cleanest, consistently funny comedy shows ever filmed, then there may be no cure.) And if you can, seek out that old friend that always made you laugh. Tell them about your troubles, let them help you make light of it. It always helps to learn how to laugh at yourself.

Another great way to relieve stress and stay happy is to exercise. We’ve covered this in previous posts but it simply can’t be repeated enough. Science has shown biological changes in people’s emotional states as a result of physical activity. But don’t just walk the stairs or park farther away from the office door—actually get out and spike that heart rate. You’ll be shocked at the effects.

Remember when you were a kid and all you wanted was that great new toy coming out for Christmas? For so many of us, it was all that mattered. Come Easter though, we’d be lucky to even find that toy in the house, at least with all of its parts intact. The point is, material goods really only bring fleeting happiness. So strive to work at other avenues toward happiness. Join a book club, a bowling team or a hiking group. Be more polite to people and seek solace in the karma they send back your way. Hold open doors, say good morning and do favors. Basically, learn to recognize positive feelings in and around you and remember them. Quite literally, sometimes we need to teach ourselves how to be happy.

In the end, staying positive in tight times is about taking control of your money problems. Don’t let them control you, seek help by calling us by and being the aggressor. Take a stand against stress caused by finances. It’s your life; keep living it.

Excerpt Much like contacting an attorney and filing bankruptcy will eventually heal your financial troubles, there are a lot of things you can do to stop the emotional setbacks you might face during or after the process.

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Published Tuesday, October 20, 2009 @ 10:15 pm

Stomach turns? Sleepless nights? Ah, the memories of your time before filing bankruptcy. Not much fun, were they?

Despite all the things that your robust credit limits may have provided you (it’s okay to admit it), somehow you would have given it all back to stop the phone from ringing and guilt from weighing you down. And while that is what bankruptcy did for you, the numbers show that a number of people often have to file a second time. Don’t do that to yourself.

To pull yourself away from the lifestyle habits that contributed to your first go-around with Chapter 7, start a new life by determining what is most important to you. Make a small list of the things you would do if you had an hour of free time. How about time with friends? Get back to the gym? Maybe start mountain biking again. Whatever is, do it.

Keep your list handy and start small. Don’t try to entrench yourself into a lost hobby right away or it will remain lost. Schedule a time with friends or a local group once a week with a similar interest, whether its running, walking or even rock climbing. The group dynamic will encourage you to participate.

Fitness has proven to be a fantastic stress reliever. If you still have the mountain bike collecting dust in the garage behind the water heater, get it out and get on the trail. Cycling has become a tremendously popular form of exercise and there are clubs in every major city, just poke around on the Internet. The outdoors, challenge and even the occasional tumble down an embankment will do a lot to put your mind in another place.

What to do with all that money you no longer have to pay to unsecured creditors? Consider joining a gym. You would be very surprised at how cheap many gyms are today. Market competition has demanded many fitness centers charge as little as $9.00 a month. Best of all, many of them do not require any sort of contract, which means your credit will not come into play upon joining. Once there, don’t just jump on the treadmill or recumbent bike–pick up some weights. Look around online for new exercises that push body weight mechanics and combine aerobic activity so your muscles are challenged each and every time. You’ll come out of each workout feeling great about yourself and full of the endorphins that incite happiness and confidence. Little by little, you will discover a new body–and state of mind–that you didn’t realize was there.

On the psychological level, exercise simply makes you forget what it was you were so worried about. A long hike in the woods or climb in the rock gym makes your focus switch to the physical nature of your situation, whether it be one grab left on your first 5.10 climb or a steep scramble up a local ridge line. Experts have found that these brief moments of concentration on physical challenges can quickly clear your mind and help your body relax in order to overcome it. In that process, the stress of the day is what gets left behind.

Beating the stress of financial worries is no easy task. Countless books have been written and studies published that discuss the harm stress can have on our physical make-up. Muscle aches, joint pain and serious health issues are often traced back to personal stress. Exercise literally pushes it out of your system, gives you a sense of personal accomplishment and helps you build a new lifestyle.

The first step to releasing the stress of debt is to talk to an experienced bankruptcy attorney. In North Carolina, contact the Law Offices of John T. Orcutt to set up a free and confidential debt consultation. Call 1-800-899-1414 or visit www.billsbills.com for more information.

See you on the trail!

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Published Friday, September 11, 2009 @ 8:53 am

My parents filed bankruptcy when I was about fourteen. I remember being worried and a little frightened by the word “bankruptcy” and the unknowns surrounding the concept. But I also knew that it was not something my parents were entering into lightly and that every other option had been considered. It was the first time I really took notice of financial issues concerning our family.

They had bought a small business that seemed to be a melding of their passions and the promise of some freedom from the ‘rat race’ and anonymity of employee-hood. While they had a passion for the business, they were not very business savvy, and ended up being taken advantage of by many people they thought were loyal to them.

I wish I could say that my parents’ bankruptcy had no discernible impact on me, a shy, awkward teenager, and my siblings, but that isn’t true. There were big changes in our lives. In most cases, a bankruptcy filing will allow a family to continue living in their home by staving off foreclosure proceedings. But since the house my family lived in was located on land owned by the business, we ended up moving. We changed schools and made new friends. My parents went back to being employees.

Now, before you conclude that this is a sad story and that your kids would be emotionally or socially scarred for life if you filed bankruptcy, I should tell you about all the positive things that came of my parents’ bankruptcy. First, we moved to a nice neighborhood where I met two of my best friends. Before moving, our home had been very isolated and we spend a lot of time alone while our parents worked their business. Afterward, our home was filled with kids from the neighborhood.

Second, while my parents did return to being employees, they found better jobs than before and worked regular hours. When you run a small business, the lines between working and not working are blurred. The business becomes a 24 hour occupation. Third, the constant stress and anxiety that my parents were subjected to from trying to keep a sinking business afloat was gone. The fear, anger, and feelings of despair finally left our home and we were finally able to function like a normal family again.

Aside from the positive benefits bankruptcy affords by removing the financial strain that may be adversely impacting your family, here are a few more things to consider when you are thinking about bankruptcy and kids:

Bank Accounts: If you’ve opened a bank account for your children’s birthday money, gift money from relatives, or money they’ve earned, it’s important to make sure this account is set up correctly. If the account is just under your name or if you’ve drawn money out to pay your own bills, this account could be jeopardized by your bankruptcy filing. Of course, any 529 college savings plans are completely protected under North Carolina exemption laws, and the funds contained in those accounts will not affected by a bankruptcy.

Opening accounts under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors Act (UTMA) can help protect these assets. The idea behind these two methods is that the “giver” remains custodian of these accounts until the minor reaches majority. Once the money is transferred into these custodial accounts, it can’t be taken back. The child is the true owner of the asset, and therefore the money does not come into the bankruptcy estate.

Child Support Payments. Debts resulting from child support will not be discharged by bankruptcy if you or an ex-spouse files for bankruptcy. In a Chapter 7 bankruptcy filing, child support obligations become top priority when assets are being liquidated. In a Chapter 13 bankruptcy filing, child support payments will be structured within the agreed repayment plan.

This bankruptcy protection for children applies whether or not a debtor is behind on support payments. The good news is that ex-spouses may find it easier to fulfill their child support obligations once the bankruptcy alleviates a majority of their other debt burdens.

If you’ve been wondering about whether your child’s future could be jeopardized by bankruptcy, a bankruptcy lawyer can examine all the details and clear any confusion. Remember, your family’s future is dependent on your financial viability. If you are buried beneath a burden of debt, protect your family by filing for bankruptcy.

The attorneys at the Law Offices of John T. Orcutt have helped thousands of families seek debt relief. In North Carolina, call 1-800-899-1414 to schedule a free initial debt consultation today.

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Published Monday, August 24, 2009 @ 7:06 am

So, now that you’ve come through bankruptcy with a clean slate and made the decision to stay off the credit treadmill, it’s time to examine your money habits and behaviors. It is surprising how many people view their credit limits as unofficial raises and create lifestyles that reflect a higher actual income than they actually earn. Are you one of them? Do you subscribe to the belief that credit scores are a reflection of your good character and trustworthiness?

One of the biggest concerns many people have when considering filing for bankruptcy is that it will absolutely ruin their credit rating for a very long time. They fear that they will never be able to buy a home or finance a new car. They believe they will not be able to get a credit card to travel, rent a car, or even a hotel room. And so there is a great deal of emphasis on quickly rebuilding credit scores by those exiting bankruptcy. Without decent credit, they fear, their lives will be reduced to a mere shadow of what they once were.

Well, in a sense, that last sentence is true – without the crutch of credit and the illusion of credit limits as extensions of their incomes, the lives of people who have gone through the bankruptcy process will be very different than what they were before pre-bankruptcy. But the difference is, they will be living on their actual income, not some inflated version of their income that they’ve invented through maxing out credit cards. There will be no heavy weight of debt on their shoulders, no trepidation on their way out to the mailbox, no creditor phone harassment. In short, without the potential pitfalls and enslavement of credit payments, a post bankruptcy life can be ever so peaceful—if it’s managed right.

For those who landed in bankruptcy through money mismanagement rather than by some other external financial blow, such as medical bills, it may prove not to be. If those people continue to deal with money after bankruptcy the same way that they did before bankruptcy, they may find themselves right back in the same stressed out, overextended situation that landed them in bankruptcy in the first place. And credit card companies know it. They know that most people emerging from bankruptcy have not really learned to manage their finances any better than they did before bankruptcy. Most people who get a new credit card after bankruptcy are carrying a balance each month within one year after discharge.

Credit card companies know that those who have taken on a lot of debt in the past, carrying growing balances month after month, and then falling behind on their payments are apt to do it again. And so sooner or later, they will extend credit even to people who’ve declared bankruptcy. Why? Because doing so makes the credit card companies the most money. Although it seems counterintuitive, the truth is that creditors see bankrupt consumers as a much more profitable customer base than the general population. They know that a person can only file a Chapter 7 bankruptcy once every eight years, so chances are high that, once hooked, the debtor will be on the creditor’s line for a long time.

You may be feeling like you’ve learned your lesson about staying on top of your payments since enduring the bankruptcy process, but even cautiously getting back into the credit game is like wading into shark-infested waters. Credit card companies, car finance companies, and mortgage lenders have all figured out ways to get you to put more and more of your hard-earned money into their bank accounts. Credit card companies offer introductory rates to get you to sign up again. Then they sit back and wait until you are even one day late on your payment, or they pull your credit report see that you are late paying any bill, from any creditor, or that your ratio of debt to available credit has increased, and they jack up your interest rate to near usury levels.

With the mortgage industry collapse, mortgage companies have reaped what they’ve sown over the past several years in the form of subprime and adjustable rate notes. However, the difference between them and you is that they are being bailed out by the government. Will you be bailed out if you become a victim of this predatory lending? Not likely.

The bottom line is, that so called ‘Credit, or FICO Scores’ are nothing more than a litmus test for how much debt you are willing to take on and juggle. People who never borrow money and always pay cash generally have very poor credit scores, yet society lauds those people as the wisest and most disciplined of us all.

The sooner you realize that you are not defined by your credit score, the better. It is possible to live a fulfilling and abundant life without being a slave to your credit report. Once you are free of the credit-as-income illusion, you can establish strategies for creating a healthier relationship with money, a positive vision of money, and the freedom that comes from being in control of your money and not letting it control you.

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Published Saturday, August 8, 2009 @ 8:47 am

We hear plenty about the dangers of gambling addictions. Perhaps this is because the compulsion to gamble doesn’t make sense to a lot of people, and it is always easier to vilify from a distance.  Or maybe it’s that gambling addictions seem dangerous because a gambler could lose everything in an instant.

By comparison, indulging in little purchases here and there seems rather tame. But even little purchases add up, and when you get a rush from spending, chances are you’ll spend more money and spend more frequently to continue to experience that comfort. Just like someone addicted to gambling, you could lose everything; it may not happen in an instant, but little warning signs ignored for years will add up and catch up eventually.

Compulsive spending and shopping addiction are very serious problems that don’t get as much attention as they ought to. As a result, there are likely many out there suffering in silence. If you suspect you are a compulsive spender, that bad news is that you may be right–but at least you’ve recognized that there is a problem that you want out of your life. Admitting you have a problem is, as they say, the first step. If you think you may have a problem with your spending, take a moment to run through some of the items that frequently appear on compulsive spending checklists:

Is pressure from debt affecting your home life? Is it affecting you on the job?

If you are constantly having fights with your loved ones over your spending, or if you find yourself unable to work because of worrying over your debts, these are classic warning signs of trouble.

Is debt changing how you perceive yourself? How others perceive you?

If you are constantly getting down on yourself over your debt, or if you are afraid for people to find out about your spending, these too are warning signs of trouble. Sometimes people with spending problems justify their behavior by telling themselves that they deserve the things they are acquiring because they are better than other people. If you catch yourself in this kind of rationalization, take it as a warning sign.

Do you play fast and loose when it comes to creditors?

If you’ve ever provided false information in order to obtain credit, or made totally unrealistic promises to your creditors, these may indicate a problem with compulsive spending.

Does spending or taking on debt feel better than it ought to?

Sure, everyone enjoys getting something new, and if you really need a loan and it comes through, it’s natural to experience relief. However, if you live for the thrill of spending, or if getting a loan makes you feel like everything is guaranteed to work out no matter what, your relationship to debt may be a poor one.

Does debt affect your health?

If you can’t sleep, if you drink or use drugs to avoid thinking about debt, your spending could have serious, lasting effects on your health, and that’s nothing to gamble with.

Luckily, more and more awareness of this problem is starting to reach the public. Organizations like Debtor’s Anonymous (www.debtorsanonymous.org) are out there to help people dealing with spending addiction.

If you have been struggling with spending addiction problems for years, you may find yourself drowning in credit card debt. If this is the case, keep in mind that bankruptcy can help you take care of your debts for good. Second chances are rare in life, but bankruptcy can provide that for you. If you have a problem, it’s time to take decisive action, and to get your life back on track.

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Published Thursday, July 9, 2009 @ 2:48 pm

Coming out of bankruptcy is a great milestone. It renews confidence, offers comfort and provides you with a sense of accomplishment from meeting a tough challenge head on and surmounting it.

Like most people who have experienced these emotions, you have comprehensive understanding of how to better control your spending and look out for your financial well-being. One component of that is learning to identify common credit report problems that arise after bankruptcy.

Look for a record of credit agency activity that is listed separately from the debt they tried to collect. This makes it appear as if you had two outstanding debts. The original debt should have been discharged as a result of your bankruptcy and thus, the agency should not appear on the report. This is a very frustrating component of a post-bankruptcy credit report because a bankruptcy eliminates debts with organizations to which you owe money but does not eradicate the record of the debts. In other words, it’s a two-step process: removing the debts and reporting that they were removed. Parts of the second step often fall through the cracks.

Another common reporting error involves accounts that were reported closed by the creditor instead of it being closed by you. This would indicate that a creditor shut down the account instead of it being done as a result of a bankruptcy, intimating that it was done outside of your control because of your inability to pay. If a closed account appears open and the payment history demonstrates a clean record, leave that one alone because it will help.

We’ve said on the blog many times but it bears repeating: make sure your credit report looks good at all reporting agencies. It’s very possible that one bureau reports a solid history and the other still shows bad debts. It is also crucial to ensure any existing debt is correctly reported by all agencies.

One technique for proving credit report accuracy after a bankruptcy is to compare your report with your bankruptcy paperwork. Look at discharged debts and then what is listed on your credit report. This is bare-bones way to rest comfortably that your information is being handled the right way and won’t derail any future loan plans, such as a mortgage or student loan.

One last bit of advice: Do not turn to a credit repair business to repair mistakes in your credit report. These are businesses that charge a hefty up front fee, promising to improve your credit score quickly. As someone who took the initiative to contact an attorney, gather your wits and decide that bankruptcy was the best option, you can repair your credit on your own. With some time and a little bit of effort, you can rebuild your credit.

From: The Law Offices of John T. Orcutt. Helping thousands of families with the power of bankruptcy. Call 1-800-899-1414 to set up a free initial debt consultation.

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Published Tuesday, July 7, 2009 @ 11:22 am

If you have made your way through bankruptcy and the old clunker is starting to make noises that you more associate with an exhausted yak than an internal combustion engine, maybe it’s time for you to consider buying a new car. Or, should you lease? It’s a tough call.

Before you think about either option though, remember to consider the ancillary costs of car ownership, like insurance. If you have a few vehicle types in mind, contact your insurance agent to determine what it will take to cover them. You may be surprised at the little things that can add up to a steep insurance policy.

Cost of repair should be in the picture too. Thankfully, many of the promotions out there today include comprehensive service plans for sometimes up to 100,000 miles. It pays to know what a tune-up will cost you or if that sporty convertible you have your eye on requires expensive performance tires that need to be replaced after 30,000 miles.

Once you understand some of the ancillary costs, it’s time to get down to the lease versus buy debate. And it’s an extensive one.

Leasing attracts car buyers because the monthly payments are typically lower. This is because in total, you are not paying back the entire cost of the car. In essence, you are only buying a portion of it. Lease payments are figured according to the loss in value of the vehicle during the lease term. Most leases also incorporate all the added fess and taxes.

Many people consider re-sale value when choosing a new vehicle. With leases, that concern is eliminated because at the end of the term, you simply turn-in the vehicle. In that respect, leases are great for people who get bored with a particular vehicle after a couple of years. Or, should something in the car become an annoyance, it’s only something you have to live with for a limited amount of time. Leasing also eliminates the hassle of having to sell your vehicle privately or back to a dealer when it’s time for another one.

Perhaps the most attractive component of a lease is that it simply costs less to get into a nicer vehicle. For people watching their wallets, that can be an easy sell. And in this recession, leases are being marketed heavily.

On the contrary, vehicle leases do present some drawbacks. For most people, especially in light of how far America commutes today, the mileage limits on leases are rarely realistic. If you go over the allotted limit, upon turn-in you should be prepared to pay some additional fees for the excess.

While the monthly payments on a lease may be less than a car loan, you are actually paying more for the car over time. Should you decide to purchase the car at the end of the lease term, you’ll find you owe substantially more on it than you would have if you originally purchased it. Of course, a lot of that has to do with the price the dealer will charge you. Finance charges are also higher with a lease, which means more money going to interest.

Lastly, be wary of the commitment factor. Leases are extremely difficult to get out from under without paying substantial penalties. If you were to die, your estate is still on the hook for the lease payment. There are a couple of Web sites out there to help you get out of a lease based on vehicle swaps but make sure your agreement allows you to do that. Yes, they have even invented penalties for that.

The Law Offices of John T. Orcutt have provided solid bankruptcy advice to thousands of North Carolina families. If you need to file for bankruptcy, you deserve the experience of John T. Orcutt. Call today to set up you free initial consultation. 1-800-899-1414.

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Published Sunday, May 31, 2009 @ 6:49 pm

The decision to file bankruptcy is more often than not driven by your willingness to accept the fact that you need help. Chances are, you are fully aware of the practical reasons: late bills, consistent calls by creditors, job loss, unseen medical expenses, stress, denied credit. However, getting over the psychological barriers can be the most difficult corner to turn in a person’s road to financial recovery.

Don’t worry, you are not alone.

Almost everyone has the same fear before going into bankruptcy. The idea that you will never again be able to own a home, buy a car or get reasonable credit can be overwhelming. Unfortunately, there are a lot of creditors out there who encourage customers to think that way. It creates a sense of fear that forces a person to believe that credit is everything, that you can’t have the lifestyle you want without it. That fear is what attracts people to applying for credit, the fear of a “below-average” lifestyle.

Having credit is a powerful thing. Personally and socially, it can make you feel confident, successful and financially comfortable. And clearly, having available credit is something everyone should strive for. But only to an extent. It’s not something you should ever use to define yourself.

When dealing with your credit after bankruptcy, do all you can to remind yourself of your old spending habits. Or, if it wasn’t bad spending decisions that led to bankruptcy, try to instill some lifestyle changes that are contrary to what you did prior to bankruptcy. Whether it was a health-related issue, divorce or other social misfortune, always be honest with yourself and the people around you. Don’t hide from your bankruptcy. After all, the important thing is you made the decision to improve your life, make changes and get yourself back on track. As earlier posts on this blog have stated, bankruptcy is not a scarlet letter, it’s simply a financial management tool.

Once your credit is re-established and you feel confident about your financial wherewithal, be wary of the lure of credit offers. Even your past creditors will happily place you on their direct mail list, sending you offers of low interest rates and annual reward catalogs laden with gifts and trips and discounts. All you have to do is spend. And spend some more.

However, you can outsmart the aggressive credit marketers by creating limits for yourself, playing credit card companies against each other when seeking interest rate reductions and account benefits and by paying your bills on time, in full, every month. And always remember, don’t count available credit as income or available savings. Also, don’t fall into the trap of believing you need a credit card for emergencies. Cash is always king, and once you use it to buy something, you’re paying for it only once, not every month.

Remember that one of the key reasons for filing bankruptcy is to make change in your life. It’s key that you take that change to another level and integrate that discipline into your personal, social and professional life. You made the right choice to file bankruptcy when you did, now make that change permanent.

Think you need to file. Find out for sure. In North Carolina, contact the Law Offices of John T. Orcutt. The initial consultation is FREE. Offices in: Raleigh, Durham, Fayetteville and Wilson. Call toll free to 1-800-899-1414 today.

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Published Wednesday, May 20, 2009 @ 11:12 am

After living with the stress of debt for a while, it’s very possible to become accustomed to it. Maybe you think that financially, things are just always going to be that way. “I’ll owe more than I make and somehow, I’ll just manage to get by every month.” Serious debt is an emotionally trying and socially problematic complication of life and unfortunately, almost like an illness, many of us learn to accept the pain and find a way to live.

But it simply doesn’t have to be that way.

Living with the sleepless nights and monthly frustrations of just scraping by is not your lot in life. You deserve to rise above it, and bankruptcy can make that happen. A healthy financial management tool, bankruptcy can cure your financial ailments and offer you the chance to start things over. And when you make that decision, you’ll begin to realize how stable your life can be without creditors being a part of it. You will also learn how to spend wisely and that true wealth is relative.

As you begin to consider the many benefits to bankruptcy, start to reflect on what habits contributed to your financial situation. More importantly, take action to correct those habits. Ask yourself, “What in my life is really necessary?” From people to junk, look around your house and social circle and assign a value to everything and everyone around you, because if it’s in your life now, it had a role in your current situation. Do you have friends that, maybe innocently, convince you to buy things you do not really need? Are there items in the closet that looked great in the store but still have tags? Cleanse yourself of things that equate to your debt, mentally and physically. The process of minimalizing can be a great step toward mental comfort because as the saying goes, “the more you have, the more you have to lose.” Sell, donate or throw away things you don’t use. Be brutal about it.

This de-cluttering process may even mean forgiving debts owed to you. It’s very possible money you have lent is a direct contributor to you filing bankruptcy. If so, let it go. It is only perpetuating your concern about money. Let whom ever owes you out of their obligation. Free yourself of seeking money owed to you and think only about changing your situation. Again, if that money helped create your position, eliminating its role in your life will only help you move forward.

A substantial portion of financial wisdom comes from self-discipline. Thus, try to stop concerning yourself with money; don’t let it be all encompassing. Even years after your bankruptcy, keep your income, financial prosperity and approach to handling money private. Don’t brag about windfalls, a good salary or a successful investment. Always be above it. Understand too, that people who always talk about their money, are usually those who don’t have any.

Consider bankruptcy as a way of finally taking control. All the bills, phone calls, late notices and empty checking accounts are things you think you can’t control. They have power over you. But you can seize that power and be the one to take charge. That is what bankruptcy is all about.

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Published Friday, May 1, 2009 @ 7:31 pm

People often have a hard time coming to grips with the decision to file for bankruptcy. Many feel that is morally wrong to do so; that we have an obligation to pay the debts off that we incur during our lifetimes. We are taught that there are consequences to our actions; that if we do ‘A’ that we will have to deal with ‘B.’ For some, bankruptcy flies right in the face of a concept that we all grew up with- taking responsibility for our actions.

There are actually two verses that refer to the concept of debt forgiveness, and much in the way that they are dealt with now. In Nehemiah 10:31b the bible state:

“Every seven years we will let our fields rest, and we will cancel all debts.”

Then also in Deuteronomy 15:1-2:

“At the end of every seven years you shall grant a release of debts. And this is the form of the release: Every creditor who has lent anything to his neighbor shall release it; he shall not require it of his neighbor or his brother, because it is called the Lord’s release.”

People often feel an intense shame in admitting that they can no longer meet their bills, their responsibilities. Many folks will even do away with some basic necessities like adequate food and clothing in order to try and meet those obligations. Marriages have fallen apart over the stress that comes with serious financial trouble. People have even been known to take their own lives because of the intense shame and despair their financial woes bring.

Since the Bible is the moral compass for most people than they should consider what it says in reference to debts. Yes, the Bible does expect us to take responsibility for our actions and pay our debts. However, as the two previous passages have shown, the Bible says that it is okay not to repay your debts if circumstances make it impossible for you to do so and you must file for bankruptcy. The Bible also shows that there is no need to be ashamed of filing for bankruptcy either, as long as you really cannot pay them.

That is why we have the court system and law that we have; to make sure that you are not just trying to ditch your bills and that you really cannot pay your bills. Basically, the legal system has taken care of the mechanics of bankruptcy and the Bible the morality of it. So if you feel that you might need to file for bankruptcy than feel no shame and do what you need to take care of you and your family.

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Published Tuesday, April 21, 2009 @ 7:15 am

Bankruptcy gives you a fresh start; a relief from the stress and uncertainty about your future. Your hope is that things will soon be back to normal. But that hope is often based on the answers to so many questions. For many, one of those questions may be about your ability to buy a home. You may have heard the myth that a bankruptcy is a black mark on your credit, and that you will never be able to buy a home. Don’t believe it for a second! You can buy a home after bankruptcy. With some time and planning, it will be much easier than you think.

First and foremost, you need take what you have learned through the bankruptcy process and apply it to your everyday management of money. Start small with credit cards (secured cards may be your only option at first) or other lines of credit and use them sparingly and pay on time. The point is to establish a healthy payment history, which is the most critical component of your credit score. Remember that when first rebuilding your credit, interest rates will be a bit higher. Nevertheless, it is important to obtain some credit to demonstrate you can maintain your finances and that the risk to grant you credit, like a mortgage or car loan, has diminished.

A mortgage lender is going to want to see at least two years of responsible credit handling as well as a steady job. A reliable source of income will mean a great deal to a bank when deciding whether or not to grant you a mortgage. Be aware that to a bank, sporadic employment, part-time jobs or freelance work will not be an adequate demonstration of steady employment.

Down payments are also important, especially in today’s lending market, but those requirements can vary. You will certainly stand out as a “good” risk if you have cash available as a down payment. Bankers will recognize this as responsible money handling and it will further demonstrate that you have maintained employment. Additionally, a down payment will help keep your monthly mortgage payment at a manageable level. The larger the positive difference between your monthly income and your mortgage, the better chance you have of being qualified.

Today’s volatile financial environment is for many people the most serious recession they’ve experienced. However, in terms of real estate, bad markets often translate into opportunity. Home prices nationwide have fallen substantially and and are unlikely to reach pre-recession levels for quite some time. This means that homes will be more affordable in the next five years. Additionally, the federal government is creating a number of first-time home buyer incentive programs to encourage home ownerhip.

Given the nation’s collective effort to help everyone get back on their feet, a person emerging from bankruptcy will be in a great position to own a home in very little time. With the advice of an experienced bankruptcy attorney and some sound financial planning, you can be rid of your debt and be on the path to owning a home.

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Published Tuesday, April 7, 2009 @ 3:36 pm

The fault of today’s recession does not rest on the shoulders of those who bought a biggertruck, new plasma television or took an extra vacation. We are in this mess because of an increasingly complicated financial tangle of ungoverned investment products that has long been too shaky to support our country’s financial system.

Unfortunately, like so many Americans, it didn’t take much for you to find yourself caught in the tide.

Maybe it started for you as a series of high-dollar home repairs thanks to an outdated waterheater in the attic. Then, your oldest child came home, with his bags and hat in hand. Finally, you’re on the outside of an unforeseen staff “consolidation.” And just like that, you are part of all those nightly news statistics, a portion of that red bar graph illustrating the growing number of debt-addled, unemployed taxpayers. Worse yet, you are part of the group everyone wants to blame for what’s happening; a group treading water in the world’s richest country and to whom no one wants to throw a life preserver.

Sometimes, things just end up going bad before you can do anything about it. So now what?

While the television and radio run rampant with ads for debt consolidation and settlement services, these roads to financial recovery rarely offer the best route by which to solve your debt problems. In fact, many debt consolidation customers end up stuck in a cycle of perpetual payments. While these debt consolidation programs may reduce some of the interest owing on your accounts, you’re still left bearing the brunt of a large unpaid principal balance.

Tough times call for bold action. It’s time to think about bankruptcy. By working alongside a reputable attorney who can clearly and professionally guide you through the ins and outs and of bankruptcy, you can find yourself on the path to a clean slate immediately. A solid bankruptcy attorney will take the time to learn about your issues, get to know your post-bankruptcy goals carefully, and craft a workable plan to get rid of your unsecured debt.

Always remember that the integrity of your family is what’s most important. Bankruptcy, while a process no one wants to face, was created to help people just like you. It’s a new door to a fresh future, one that may not be found through the fog of endless debt consolidations and halfhearted attempts at settlement. Do the right thing by committing to a plan and calling a dedicated bankruptcy attorney today.

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