Next to questions about how to help stop foreclosure and (especially in this season of the year) tax refunds, I would say that as a debt consolidation lawyer offering bankruptcy services in Indiana, the topic I get asked about most  is cars.

When someone is dropped off at the Mark Zuckerberg bankruptcy law office because they don't have a car (the Anderson, Bloomington, and Columbus bankruptcy lawyers who work in my offices there say exactly the same thing), that person is typically in an immediate and very real bind.  If the car's been repossessed, I may have some hopeful news to share.  According to Chapter 13 bankruptcy law in Indiana, if you file before their automobile has been sold, the creditor has to give the car back immediately.

Generally speaking, the new bankruptcy laws in Indiana are designed not to punish, but to rehabilitate. In other words, the whole idea behind the bankruptcy system is to offer honest debtors a chance at a fresh financial start. The court recognizes that the lack of a driver's license can interfere with a person's chances for that fresh start.

Much of the time when clients talk to me about problems relating to their driver's license having been yanked, it's because they have unpaid tickets, unpaid fines, or unpaid automobile damages.  These debts might not even have to do with bad driving or accidents, but might be due to parking violations or equipment violations (noisy mufflers, bald tires, or broken headlights and such). Sometimes they don't have the money to pay because they're out of a job and, needless to say, can't go on a job search without a car!  Again, in this situation, I might have hopeful news.  Assuming there are not criminal charges against the debtor, Chapter 13 bankruptcy  law might offer a chance to get the driver's license back the next day.

Now, if the problem started with an accident resulting in damages over $1000, or you commit a moving violation, the situation is more serious.  You have forty days to submit proof of financial responsibility (insurance) to the state police. (If you can't do that, you're liable for paying the damages outright or for working out an installment plan to pay).  As part of the Indiana bankruptcy help I provide, we would send proof of your bankruptcy filing to the motor vehicle licensing department.

I've been offering Indiana bankruptcy help for almost twenty five years.  I know how big a problem it is not to have wheels.  I know the bus doesn't go anywhere near your job, and how difficult it is to make job interviews when you don't have transportation.  I know that, without a car, you've no way to get family members to the doctor or pharmacy. That's why, if you've been dropped off at one of the Mark Zuckerberg bankruptcy law offices, you've come to the right place.  You've got problems having to do with your car and your license to drive it, and you're seeking experienced legal help.

This being tax season, it's no surprise that, as an Indiana lawyer for bankruptcy, I get a lot of questions about tax refunds. "Do I get to keep my refund if I file bankruptcy in Indiana?" (At least ten blog readers asked that very question, so I decided to devote today's blog post to how the new bankruptcy laws in Indiana relate to tax refunds.

There are two possible scenarios here: 

You file bankruptcy, already having received your refund.
(This  is an area where it's important to seek proper bankruptcy information in Indiana!)

a)   If you still have the cash from the refund, it becomes part of your assets, and must be listed in the bankruptcy paperwork.  You're entitled to keep a certain amount of cash, so it would depend on how much you have in total assets whether you got to keep the refund or whether it needs to go towards repaying creditors.

b)  You received the refund money before filing, and you've already spent the money. If the bankruptcy court finds you spent the money on luxuries and now are asking to have debts forgiven, the court will not look favorably on granting you a bankruptcy at all!   If you spent the money "properly", meaning on necessities such as making a mortgage payment, catching up on bills, or having medical or dental work performed, that will not count against you.


You've filed bankruptcy and expect the refund to come in soon.

At the Creditors' Meeting, the trustee usually asks debtors whether they're expecting any money to come in.  That's because the court wants to see if there are resources that can be used towards satisfying the debts.  It's possible that (beyond the exemptions, meaning cash and assets you're allowed to keep), the tax refund would be lost by becoming part of the bankruptcy estate (used to pay creditors).

One of the Columbus bankruptcy lawyers in the Mark Zuckerberg bankruptcy law offices there was asked a question about property tax debt.  First, property taxes aren't dischargeable in bankruptcy unless they became due more than a year ago.  But, even if property tax were to be discharged by the bankruptcy court, the property could not be sold until the lien was paid off (because there wouldn't be a clear title). The attorney is now discussing with this Columbus taxpayer whether or not filing bankruptcy might help stop foreclosure.

You know the old saying, "Timing is everything?"  That's something that comes to mind when it comes to tax refunds and bankruptcy.  You may have read this idea in my earlier blog posts, but it bears repeating: The timing of tax refunds and individual bankruptcy in Indiana is not a do-it-yourself decision!

It's no secret - scams make my blood boil.  Here I am, working for close to twenty-five years to help people facing severe financial challenges.  Along with the Columbus bankruptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices there, I work to help stop foreclosures on my Indiana bankruptcy clients' homes.  Then we run up against foreclosure consultant scammers preying on vulnerable homeowners - it's enough to make anyone outraged!

Then, as an Indianapolis bankruptcy attorney, I encourage debtors to rebuild their credit step by step after emerging from bankruptcy.  Then I learn of identity theft schemes of every kind that can so easily sabotage all the debtors' best efforts.  Talk about blood boiling!

The most recent scam warnings issued by the Federal Trade Commission have to do with the cruelest kind of all - online job scams. These just really get to me.  Job losses, mind you, have always been one of the three leading causes of bankruptcy, along with divorce and medical bills. But, during the past two years, with the job situation being so very difficult, it's extraordinarily cruel to target the unemployed.  The scams typically begin with job placement ads or work-at-home schemes. 


The FTC warns the public not to fall for online offers such as:

• Job listings in return for a fee
• A business "opportunity" in return for an up-front investment
• Ads seeking to hire people to use their own PayPal accounts to facilitate transactions with foreigners (It typically turns out there are no real foreign customers, and the US middlemen victims are hit with penalties and fees from PayPal and the credit cards).

As Pam Dixon, executive director of the World Privacy Forum explains, "help wanted" scams work "because unemployed people are vulnerable." I'm hoping that my Indiana bankruptcy clients and bankruptcy blog readers get the message loud and clear.  In today's economy, a lot of people need the help of a debt consolidation lawyer and Indianapolis bankruptcy attorney.  What they don't need is online job scammers!

 

As part of providing bankruptcy services in Indiana, I can never forget one thing.  Whether a bankruptcy is a Chapter 7, or whether we're talking about  Chapter 13 bankruptcy law in Indiana, a job is going to be part of the script.  Without well-paid jobs, debtors emerging from bankruptcy can't rebuild their finances or keep current on their debt repayment plans.

Just yesterday I shared news about three Indiana companies that are expanding their work force.  Today I have more pieces of good news about where the jobs are:
 

• RV LLC is locating a new manufacturing center in Marion, which will bring up to 300 jobs into the area.
• Caterpillar is recalling 100 workers that had been laid off in Lafayette.
• Centennial Graphics Group (a book publishing and binding company) is creating 48 new jobs in New Albany. (I'm especially glad about this, because the New Albany area is served by the Zuckerberg bankruptcy law offices in Bloomington, and by the Columbus bankruptcy lawyers who work in the Mark Zuckerberg law offices there.)                               

• The Whirlpool ice making plant in Evansville is being moved to Iowa, and the majority of Whirlpool jobs in Evansville are being shipped to Mexico.
• Meanwhile, there's some bad news about another corporation, one I've mentioned in earlier blog posts.  Accuride, also in Evansville entered Chapter 11 bankruptcy five months ago, and now they are emerging because the court approved their reorganization plan.  The bad news for Indiana, though, is that the Guinite subsidiary of Accuride in Elkhart, is closing, meaning 225 jobs will be lost.

Mind you, these are more than mere statistics to me.  As a debt consolidation lawyer and long-time bankruptcy attorney in Indiana, I'm "boots on the ground" helping those who've lost jobs get help.  Sometimes it's payday loan debt help or student loan debt help.  Sometimes my colleagues and I help stop foreclosure,  It all comes down to what I send yesterday: The times aren't going to be better until the job markets are!

All the politicians, all the radio talk show hosts, all the newspaper reporters, magazine writers, bloggers and television news anchors – they’re all talking about jobs and so am I, along with the Columbus bankruptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices there. There is commentary about the jobless claims rate, the unemployment statistics, the job stimulus programs, the expansions, the closings, the hiring, and the layoffs. 

Everyone “gets the picture” by now, and everyone knows that times aren’t really going to be good again until the jobs are.  Thankfully, at least according to an RTT News report, there are some glimmers of hope on the horizon - first time jobless claims have begun to “fall more than expected.”

As a debt consolidation lawyer and bankruptcy attorney in Indiana, I know the term “jobless claims” refers to the number of people filing for unemployment benefits for the first time. Wall Street commentators had expected January claims to drop by 15,000 nationally; instead, there were 43,000 fewer claims, with the month’s total being 440,000 nationwide. This is the lowest level we’ve seen in a year and a half, so that’s good, although we have a long way to go. Knowing only too well that, even with the Indiana bankruptcy help I provide, without a supply of good jobs, my clients cannot keep up with their debt repayment plans according to Chapter 13 bankruptcy law in Indiana, I do my best to stay on top of every bit of news having to do with jobs in our state.

• RV maker Jayco is expanding in Middlesbury, creating 75 new jobs.
• WNDU-TV in South Bend expects to hire 50 new workers.
• Living Essentials in Wabash is expanding its energy drink company, creating up to 36 new jobs.

I wish all the news were positive, but I did hear a big negative item out of Ft. Wayne: The Fort Wayne Foundry Corporation is closing its plant in Columbia City, leaving 114 people out of work.  Still, the net numbers are turning in a positive direction.  According to WSCI Radio in Columbus, "Indiana is bucking the national trend with three straight months of declining unemployment.”

Meanwhile, I and my colleagues keep on working, offering payday loan debt help, negotiating with lenders to help stop foreclosure,  offering relief to the thousands and thousands of people drowning in financial problems that began with job loss.

As a debt consolidation lawyer and Indianapolis  bankruptcy attorney, I've always found foreclosure to be closely linked with bankruptcy.  Of course, legally speaking, these two issues are governed by two totally different sets of laws, but what I mean is this: when clients turn to me for help with financial problems, the threat of foreclosure on their home is invariably one topic they want to discuss along with exploring bankruptcy in Indiana.

If you've been reading my bankruptcy blog for the past few years, you know that my colleagues, the Anderson, Bloomington, Indianapolis, and Columbus bankruptcy lawyers in the Mark Zuckerberg law offices and I all help stop foreclosure by negotiating mortgage modifications.  I've been following closely all the different federal stimulus programs that help homeowners remain in their homes.

The latest program I read about actually isn't coming from the federal government, but from a private financial institution.  Citigroup announced two weeks ago a pilot program called Foreclosure Alternatives.  This program will not originally be available here in Indiana, only in Texas, Florida, Illinois, Michigan, New Jersey, and Ohio, where a combined 1,000 homeowners are expected to participate.  Then, depending upon the results, the program may be expanded to other states, including ours.

As part of providing bankruptcy information in Indiana, I often use the expression "buying time" when discussing bankruptcy, meaning time to organize a plan for handling debt.  The Citi plan offers time to homeowners threatened by foreclosure.  In a foreclosure, the lender takes control of the property and evicts the homeowner, usually within a few days. This foreclosure alternative plan is a form of deed in lieu of foreclosure, because Citigroup, the lender, takes control of the deed.  If no settlement is arrived at, homeownesr might still need to leave their homes, but:
 

• The program "buys" six months of additional planning time
• There is a less severe "hit" to the homeowner's credit report than a foreclosure might cause
• Citi is offering $1000 is relocation costs plus relocation counseling

Foreclosure alternatives are one form of "buying time", and buying time can mean getting help!

February is not only the snowiest month this Indianapolis bankruptcy attorney has seen in Indiana in a while, it marks the one-year anniversary of the Obama Mortgage Modification plan. 

As a debt consolidation lawyer and an Indiana lawyer for bankruptcy, I've always been involved in helping people with home mortgage-related problems.  And, even though it's true that foreclosures and bankruptcy are governed by different sets of laws, in my "real world" of practicing bankruptcy law (over my twenty-plus year career offering bankruptcy services in Indiana I've dealt with tens of thousands of individuals),  it seems that people who have concerns with debt are also concerned about keeping their homes.

Under the Home Affordable Modification Program (HAMP), it was decided, up to $75 billion could be spent.  The money was to go towards offering incentives to banks and lenders to renegotiate mortgages for three to four million homeowners, so that foreclosure could be avoided.  As of the end of 2009, according to Neil Barofsky, Special Inspector General for the TARP program, only a little more than $15 million has been disbursed. Only a little more than 66,000 homeowners nationwide have received permanent mortgage modifications, although there were more than 900,000 "trial modifications" in place.  RealEstateRama reports that 100,000 of these have been approved on the lenders' side for becoming permanent, awaiting approval by the borrowers.

When I say this month marks an anniversary, I really mean it.  For almost the entire year, I, along with the Anderson, Bloomington, Indianapolis, and Columbus bankruptcy lawyers who work in my bankruptcy law offices in each of those places, have been trying especially hard to help our clients negotiate with their lenders on mortgage modifications. 

In the meanwhile, all of us have been following the legislative debate about whether bankruptcy judges should be given the right to modify mortgages, a measure which, despite lengthy debate in both houses of Congress, failed to pass into law. Despite the frustration, I mentioned in one of my Indiana bankruptcy blog posts, Mortgage Modification Frustration Has Sunny Side, that, even when the lender has not granted a modification to a client, the very process of working with a legal professional to organize their financial information has often helped these clients gain greater control over their finances and positioned them to make wise decisions about both their mortgages and their debt problems in general.

As someone who's offered bankruptcy services in Indiana for almost twenty-five years, I tell myself I've seen it all.  But, for those who haven't, I feel compelled periodically to use my Indiana bankruptcy blog to prevent them from becoming fraud victims.

The Columbus bankruptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices there agree - we've all found this to be an unfortunate truth: Scamsters tend to "hang around" wherever bankruptcy "lives". The first reason for that is that often, in a frantic attempt to stave off bankruptcy, debtors will look for any straw to grasp, and end up looking for help in all the wrong places, to paraphrase the old song about looking for love. That has been especially true during this economic downturn, with so many having lost jobs and medical insurance coverage.

Pre-bankruptcy predators include some payday lenders and some debt settlement agencies, according to the Center for Responsible Lending. There are "credit repair" scams, "debt consolidation" scams, mortgage modification scams, and foreclosure prevention scams to watch out for in addition to outright identity theft through stolen credit cards and IDs. People who are in financial trouble but who have not sought the advice of a bankruptcy attorney in Indiana tend to be the ones most vulnerable to believing there just might be a "quick fix" to their problems.

Financial planner Ken Clark, author of Getting Out of Debt, warns debtors against "Nigerian 419" scams (email request to help get money from Nigeria into the U.S., by accepting money into your own bank account in exchange for a handsome share of the money) and "Chain Letter" scams (email scam asking you to forward money to the sender and then invite 8-12 of your friends to do the same. The idea is for you to keep part of the money and forward on the rest, a modern version of an old type of pyramid scheme).

Some very innocent-appearing scam comes in the form of offers for a "free" credit report.  In order to get the report, you have to enter your credit card account number, which opens the door to identity theft.  Even in cases where an actually credit report is sent, sometimes charges begin appearing on your credit card account because somewhere in the "fine print" you agreed to that.  As a debt consolidation lawyer in Indiana, I'm constantly reminding my clients and bankruptcy blog readers - the only truly free reports come from the credit bureaus themselves.

The scamsters love to hang around even after bankruptcy has been processed! Post-bankruptcy predators offer low-balance credit cards to debtors emerging from bankruptcy, sometimes with activation and membership fees that push borrowers over their credit limits before they've really had a chance to use the card! Other scams masquerade as "credit rebuilding services". 

I've spent my entire career  as a offering Indiana bankruptcy help, even helping to craft the new bankruptcy laws in Indiana.  It really bothers me when so many debtors fall prey to scams when legitimate help is available through the bankruptcy safety net.  I'm doing all I can to spread awareness about scams and scamsters, hoping every debtor gets the message in time.

 

Barry Corbin's name is not nearly as well-known as Nicholas Cage's, but Corbin just joined the list of celebrities who've filed bankruptcy. Far from rejoicing that another of the rich and famous is suffering from financial setbacks, I talk about stars' troubles only for purposes of illustrating how the bankruptcy safety net works.

Needless to say, as a bankruptcy attorney in Indiana, I must observe client confidentiality for the tens of thousands of clients whom I've helped with filing personal bankruptcy in Indiana, as well as for the thousands of clients who have filed small business bankruptcy in Indiana. When there's already a story in the news about a celebrity bankruptcy, by contrast, I am permitted to comment in my bankruptcy blog posts.

Barry Corbin, you might remember, was "Uncle Bob" to John Travolta in the movie Urban Cowboy, and played on TV in both the Dallas and Police Academy series.
It's interesting that just a year ago, I was writing about Michael Vick filing bankruptcy and using that news story to illustrate the different steps in the bankruptcy process, including the Creditors' Meeting.  Then, just a couple of months ago I was writing blog posts about Nicholas Cage filing bankruptcy, and, from my vantage point as a debt consolidation lawyer and someone who's been offering Indiana bankruptcy help for almost a quarter century,  analyzing some of the factors that led to that actor's troubles.

One factor common in all three of these celebrity bankruptcy stories is real estate.  When discussing Chapter 13 bankruptcy law in Indiana, I always explain that foreclosure and bankruptcy are two separate legal processes, even though in most client situations, both seem to play a part in the financial troubles.
 

• In the Michael Vick case, one of the biggest assets that was put up for auction in order to pay creditors was a luxury home he owned in Atlanta.
• Nicholas Cage had already lost two homes in New Orleans to foreclosure and needed to sell other properties at a big discount to raise money to pay creditors.
• Barry Corbin is trying to reduce costs by selling his home in Texas, using the proceeds to pay creditors.

In all three cases, the fact that real estate values have dropped has delayed the sale of the homes.  The drop in home prices is affecting many Indiana residents who are trying to downsize and keep their bills paid, but who are being forced to consider bankruptcy.

A second factor, tax debt, played a part with Nicholas Cage, but doesn't appear to be the issue with Barry Corbin. (According to Forbes, Nicholas Cage owes more than $800,000 in back taxes and penalties.)

The thing about the Barry Corbin case that really resonated with me (in fact, I was discussing this very thing the other day with the Columbus bankruptcy lawyers who work in the Mark Zuckerberg law offices there) is something Corbin's lawyer said about the reason Corbin needed to file bankruptcy:

"The types of movies that he is used to making, they are not making anymore."

In the course of my work as an Indianapolis bankruptcy attorney, it's very, very rare that I deal with a celebrity case.  The vast majority of my Indiana bankruptcy clients are everyday working people and small business owners. When most of these business owners first seek my help, they admit they are upset and even ashamed that their businesses are in trouble. Yet, as I learn more about their stories, I usually find these troubles were caused by changes in their industry that were beyond their control.

Things change, even when we most wish they would remain the same. Sometimes, they're "just not making them any more!"  That's when good people need society's help in the form of bankruptcy to give them a fresh financial start.

Just hearing about all the jobs coming to our state in the next year or two improves my mood!  As I help clients file individual bankruptcy in Indiana and help stop foreclosure on their homes, I feel more optimistic about their being able to take advantage of the fresh financial start available through the new bankruptcy laws in Indiana.

In just the first two weeks of this month of February, 2010, I learned that no fewer than a dozen sizeable corporations plan to hire new workers.  (The information I'll share with my Indiana bankruptcy clients and my blog readers today comes mainly from the Indianapolis Star, Inside Indiana Business, and the Indianapolis Business Journal.)

Because, as an Indiana lawyer for bankruptcy, I know that bankruptcy can spell relief only if my clients can earn income to rebuild their financial lives after emerging from bankruptcy, I'm constantly scanning the pages and surfing the Web to find news about employment in our state.

The Bloomington and Columbus bankruptcy lawyers who work in the Mark Zuckerberg offices there provide bankruptcy services in Indiana all the way to the southern border of the state, so I paid special attention to news of southern Indiana companies planning to hire.

• First, more than 2100 seasonal positions are being offered at Holiday World.  In fact, job fairs are being held this month.
• Mead Johnson is bringing 35 new jobs to Evansville.
• Berry Plastics is creating 250 jobs in Evansville.

In northern Indiana, there is good news as well.

• Morris Manufacturing and Sales, which makes auto components, expects to create 82 jobs near Ft. Wayne.
• Also in Ft. Wayne, Edy's Ice Cream is creating 120 new jobs.
• Vixen Composites, a recreational vehicle and commercial trailer company, is creating 34 new jobs in Elkhardt
• Seliga Plastics will have 150 new jobs to offer in Ligonier.
• Enert, Inc., parent company of Enerdel, is relocating to Elkhardt, bringing 415 new jobs.

In and around Indianapolis, there's good news, too. (Although I have bankruptcy law offices serving 38 different counties in Indiana, I operate primarily as an Indianapolis bankruptcy attorney.)

• Express Scripts pharmacy benefit management company is planning to add 182 jobs.
• Zipp-Speed Weaponry, which makes high-end bicycle components, is building a new center on the northwest side of Indy, bringing 105 new jobs.
• Bluefish Wireless in Zionsville is set to create 150 new positions.

A bit further away, there's good news from Brazil, and in the other direction, from Connersville,

• The Morris Manufacturing and Sales (in Brazil) will add 82 automotive component jobs.
• Carbon Motors' grant application to the U.S Dept. of Energy was deemed complete.  The potential is for 1,500 new jobs with that company.

Negative employment news seems to be taking up less space these days.

• Kmart is closing in Connersville, with 59 jobs scheduled to be lost.
• Ampcor metal casket company is closing in LaPorte, eliminating 50 jobs there.
• Radio manufacturer ITT Communications is cutting 60 positions.

The companies I mentioned in today's blog post are medium to large-sized firms.  But my more than 20 years providing bankruptcy information in Indiana have taught me that, when midsized and large firms expand, that's good news for my small business bankruptcy  clients in Indiana who are suppliers to those larger firms.

Let's keep that good news coming!

As a debt consolidation lawyer in Indiana, one of the many things I do is help stop foreclosures.  Well, one evening while driving home, I tuned into the Howard Clark Show on WIBC, and heard him discussing short sales and foreclosures.  Howard was offering a special tip to listeners who were interested in buying distressed real estate, so that banks wouldn't "demolish their credit scores."

Clark's tip was referring to credit checks. When investors wanted to bid on a home being sold in a short sale or on one being sold by a lender after a foreclosure, the banks would run a credit check on every bidder, and do that every time they bid.  That resulted in a lot of credit inquiries showing up on bidders' credit reports.

As an Indianapolis lawyer for bankruptcy, I often give clients who have emerged from bankruptcy the same kind of advice when they're shopping for a car:  Avoid multiple credit inquiries.  I recommend to the Bloomington, Anderson, and Columbus bankruptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices in those cities that they tell their bankruptcy clients the same thing.

Here's what I mean.  If you take a look at your own credit report, you'll probably see multiple credit inquiries listed on it.  Businesses you never heard of might be thinking of trying to get you as a customer.  Prospective employers might have checked your credit report.  An insurance company might have inquired.  Or you might even have requested a check on your own report.  None of these are any problem.  The only inquiries that can negatively affect your credit score are the ones generated when you apply for new credit.

That's why Clark Howard was warning would-be bidders on distressed property about the potential damage to their credit ratings. He explained to listeners that, until their bid was actually accepted, there was no legitimate reason for the bank to check their credit score.  For the same reason, in offering Indiana bankruptcy help, I advise clients who have filed and emerged from individual bankruptcy in Indiana to bring along a copy of their own credit report when they visit different auto dealerships to try to find a car.  That way, they won't have multiple potential lenders all make inquiries with the credit bureaus.  And that way, their credit scores won't be "demolished". 


 

Usually, whenever I or one of the Anderson, Bloomington, Indianapolis, or Columbus bankruptcy lawyers in the Mark Zuckerberg bankruptcy law offices is advising clients on mortgage matters, it's for the purpose of negotiating a mortgage modification with a client's lender. But, as more and more seniors are being forced to consider bankruptcy in Indiana, the subject of reverse mortgages has been coming up frequently is we meet with our clients.

By way of quick review, homeowners over the age of 62 can use a reverse mortgage to convert their home equity into cash they can use. As long as the homeowner continues to occupy the home, repayment is not due; the bank is repaid only when the house is sold.  Seniors are allowed to choose among three ways to receive money out of their home equity:

 

• A line of credit from which the homeowner can draw as needed.
• A monthly fixed amount for a fixed period of time.
• A monthly fixed amount for life. (This is calculated based on seniors' age at the time and the amount of equity they have in their home.

It appears today's bankruptcy blog reader chose to receive a fixed monthly payment out of his reverse mortgage.  His question is: How would filing individual bankruptcy in Indiana affect those monthly payments?

As a bankruptcy attorney in Indiana and also as a debt consolidation lawyer, I've been handling bankruptcy and foreclosure matters for decades. When a reverse mortgage is involved, though, matters become a bit more complicated. So the very first thing I want to emphasize to this blog readers is how important it is for him to seek expert legal advice on reverse mortgages before moving forward with an individual bankruptcy in Indiana.

Some of the factors that the bankruptcy court will be considering include:

• If a debtor's equity in his/her home doesn't exceed the Indiana exemption of $15,500, he or she can keep the home, even in a Chapter 7 bankruptcy.
• In the case of a reverse mortgage, the "equity" is the unused income that has yet to be paid out to the owner.
• Filing bankruptcy does not constitute a default against the reverse mortgage, so foreclosure is not an issue.

About the income:

• As part of filing bankruptcy, the homeowner must report all sources of income.  That would include the reverse mortgage payments.
• In a Chapter 13 bankruptcy, that income would be considered in created a debt repayment plan.

Every bankruptcy situation is different.  Designing the right strategy for each client is part of the skill required of a certified consumer bankruptcy specialist, and is what makes my work so interesting after all these years of practice.

Suffering from the worst financial troubles you’ve ever faced? You’re not alone.  “There are several million families in situations not too different from your own,” says bankruptcy expert Elizabeth Warren (I quoted her book The Two-Income Trap earlier this week in my Indiana bankruptcy blog.

Should you end up reading the book yourself, you’ll find lots of valuable information. But, as an Indianapolis bankruptcy attorney and debt consolidation lawyer, I believe there’s one point discussed in Warren and Tyagi’s book that needs clarifying:

If you’re going to file bankruptcy, what is the best timing?

The authors suggest:  “If at all possible, wait until the crisis has passed before filing bankruptcy.  If you are out of work, wait until you have found a new job.  If you have a child who is seriously ill, wait until he is better and the health insurance has paid what it owes.”

The reasoning:  “If you wait, you minimize the risk that you will once again find yourself buried in debt after you file for bankruptcy… If you wait to file until the worst of your problems are over, you give yourself the best odds of getting exactly what you need from the bankruptcy judge – a fresh start.”

Along with the Anderson, Bloomington, Indianapolis, and Columbus bankruptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices, I’ve been offering bankruptcy services in Indiana for almost twenty-five years.  I can certainly agree that filing bankruptcy is not something anyone is in a hurry to embrace.  At the same time, after working with tens of thousands of individuals and families over the years, I see people waiting too long to deal with their financial problems.

Instead of seeking expert help with mortgage modification to help stop foreclosure, I see people taking out subprime second mortgages or falling prey to foreclosure prevention scams.  Rather than reviewing their assets and debts with a legal expert, too many are taken in by debt consolidation scams or rapid refund tax scams.

Often, prior to coming to see me, folks cash out life insurance policies and withdraw money from their retirement accounts (types of assets they might have preserved because they’re exempt from creditors under the new bankruptcy laws in Indiana). Then, as bankruptcy begins to seem inevitable, people splurge on luxury items or transfer assets to family members or friends, hurting their chances of having their bankruptcy case approved by the court when they finally file.

Meanwhile, harassment by creditors increases the pressure, so that, with every passing day it becomes more difficult for debtors to make calm, reasoned decisions when it comes to bankruptcy in Indiana.

So I guess I disagree with the Warren/Tyagi advice about timing.  My own advice is for people to take the first step (a no-obligation frank talk with a board certified consumer bankruptcy specialist) at the first signs (of financial distress). The old saying about “Better late than never” might contain a grain of truth, but when it comes to bankruptcy in Indiana, early is best of all!

Today's bankruptcy blog reader's question hints at a very sad picture - a home going up for public sale.  While I'm not familiar with the details of this particular case, as an Indianapolis bankruptcy lawyer for so many years, I'm unfortunately all too familiar with the general picture.

A "Notice of Public Auction Sale" has been posted, perhaps because the reader's home was seized for nonpayment of federal taxes. Perhaps it's the mortgage lender that has foreclosed on the property.  In the course of a bankruptcy, the bankruptcy court may employ an auctioneer to manage a public sale of a property. In any case, it appears that, for this reader, there's a "Sheriff's sale" going on.  The frightening answer to the reader's question about when eviction might take place is - "Soon, very soon, perhaps within the week of the public sale."

It's rather rare, in my experience offering bankruptcy services in Indiana for more than twenty years, for the bankruptcy court to force the public sale of a home if the debtor files bankruptcy.  Remember, in the new bankruptcy laws in Indiana there are exemptions (In fact, I helped write the exemptions portion of the Indiana bankruptcy laws), and one of those is the Homestead Exemption, allowing Indiana residents to keep their homes if they have little or no "equity" in those homes.

Apparently, in this blog reader's situation, the exemption did not apply and eviction looms.  The reality is that, with an eviction on his record, our reader is likely to encounter difficulties in renting an apartment. This is unfortunately true not only in the "big city", but in the smaller cities and towns as well, as the Anderson, Bloomington, and Columbus bankruptcy lawyers who work in the Mark Zuckerberg offices tell me. 

As any doctor will attest, preventive medicine is the best kind, and it's no different in my professional as a debt consolidation lawyer and consumer bankruptcy specialist in Indiana. Whenever possible, I like to spend time talking with clients about debt management, and about individual bankruptcy in Indiana.  I help clients negotiate with lenders, and represent them in arranging mortgage modifications.  Sometimes the best advice for a client is to let the home go into foreclosure given financial circumstances that have changed for the worse.  Never is it a pleasant picture when someone is in danger of immediate eviction from a home.

At least according to Women's Personal Finance.net, "The myths and the madness behind the realities of bankruptcy…can sometimes have more wrong information than the only hair stylist in town."

I'm certainly no expert on women's hairstyles or hairstylists, but, as an Indiana bankruptcy attorney, I've always known that women often bear the brunt of a financial crisis.  That's why, as part of offering bankruptcy information in Indiana through my Indiana bankruptcy blog and the four Mark Zuckerberg bankruptcy law offices around Indiana, I devote special attention to helping women file personal bankruptcy in Indiana and to helping women take advantage of the fresh financial start bankruptcy can offer.

As the Women's Personal Finance website is careful to explain, filing bankruptcy doesn't "erase" a woman's credit record. Even after debts have been "discharged" or forgiven by the Indiana bankruptcy court, the debts will remain on the credit report, but the balance from each creditor will be changed to zero.  (What that does is stop additional negative marks from being added, but late payments in the past remain on the record, even though the balances due are eliminated.)

The Consumer Federation of America estimates that single women comprise almost 40% of bankruptcy filers.  USA Today agrees, stating that "Recession Can Hit Hard in Families Headed by Women" (May/4/09 issue).

My own experience bears this out, and I've found that women need to protect their own welfare and the welfare of their children. Often a woman-to-woman talk with one of the female professionals in my bankruptcy law offices is the start of hope for clients who'd been given a lot of incorrect information about their options.

One of my favorite sayings, one that women, in particular, seem to appreciate, is "Bankruptcy comes in cans."  Women need to understand that, even though bankruptcy is not what they might have envisioned as being part of their lives, there are many, many advantages in using the Indiana bankruptcy help our laws have provided to:

• stop repossessions
• stop foreclosure on a home
• stop creditors from harassing them and their family members
• wipe out credit card debts
• stop wage garnishment
• get rid of back taxes

As a board-certified consumer bankruptcy specialist, one of only a dozen in our state, I don't know a thing about women's hairdressing or hairdressers.  I do know a lot about being an Indiana lawyer for bankruptcy for women!

Just yesterday, offering bankruptcy information in Indiana through my blog, I used examples of big corporate bankruptcies to illustrate how the small business bankruptcy system works for my Indiana bankruptcy clients.

Today, however, let's talk personal bankruptcy in Indiana.  This time, I'll use three examples of celebrities who filed bankruptcy last year to illustrate some of the causes of the individual bankruptcy I see right here at home.

1.   Movie actor Stephen Baldwin filed bankruptcy in 2009, after his mortgage company began foreclosure proceedings against him.

Over my many years handling individual bankruptcy in Indiana, I often need to explain to clients that foreclosure and bankruptcy are two separate legal processes. (Proposals to allow bankruptcy judges to modify mortgages were not approved by Congress.) Designing exactly the right strategy to fit the situation of each client who needs Indiana bankruptcy help, a strategy which may or may not include foreclosure, is a big part of what being a board-certified consumer bankruptcy specialist is all about for me. 

2.  Former major league baseball All-Star Lenny Dykstra of the New York Mets, filed bankruptcy because some gigantic business deals failed and led to many expensive lawsuits.

One of the things I often find is that business dealings and personal finances have not been separated, so that business failures are intertwined with personal financial failures, leading to bankruptcy. The Columbus bankruptcy lawyers who work in the Mark Zuckerberg offices there twll me that often a Chapter 11 small business bankruptcy will quite often be paired with the need for a debt consolidation lawyer on a personal level as well.

Comedian Sinbad was forced into bankruptcy because of a lien on his income for failure to correctly file taxes on some of his hit DVD's.

It is crucial for people behind on their federal and/or Indiana taxes to work with an experienced consumer debt and bankruptcy professional in order to make use of all the legal advantages available.  Getting on the wrong side of tax authorities is dangerous. However, it's a myth that you can never have tax bills discharged in bankruptcy.  In fact, most income taxes more than three years old qualify for forgiveness under Indiana bankruptcy laws.

In all my nearly twenty five years as an Indiana bankruptcy lawyer I have had only a handful of movie stars or sports star clients.  But, helping tens of thousands of clients deal with problems relating to foreclosure, tax liens, lawsuits, and small business issues, making Indiana bankruptcy laws work for them? That's exactly the stuff of which an Indiana bankruptcy lawyer's career is made!

You don't need to be a bankruptcy attorney in Indiana to know that a few bad apples can spoil things for a whole bushel of others.  And, while plenty of bankruptcy filers were pushed over the financial edge because they were victims of identity theft or foreclosure scans, unfortunately, sometimes fraud goes the other way.

When bankruptcy fraud is committed by a debtor, it usually means assets were concealed from the court.  Either the debtor left assets off the list on the paperwork turned into the bankruptcy court, or ownership was secretly transferred to family members or to friends.  Sometimes debtors conceal part of their income in order to qualify to file bankruptcy in Indiana.

Bankruptcy fraud is a felony carrying a fine of up to $500,000 and/or a five year prison sentence.  However, according to Bloomberg News, even though bankruptcy filings rose last year, very few fraud cases were prosecuted.  That's because, as the FBI stated, the emphasis was on securities and mortgage fraud.

One of my goals in offering Indiana bankruptcy information in my blog is to make clear how important a role the bankruptcy process plays in our society, and how important it is for all parties - both debtors and creditors - to be treated fairly.  The system can function well only when there is full and honest disclosure of assets and liabilities.

One of the most important parts of the work I've been doing as a debt consolidation lawyer and Indianapolis bankruptcy attorney is helping debtors prepare the paperwork that needs to be turned into the bankruptcy court.  And one of the things I've learned in almost twenty five years of doing just that is that most debtors have no intention of committing fraud - they just need help getting their numbers together.  Often, as their financial problems mounted, debtors didn't keep the best of records.

That's why I'm so proud of the trust I've been able to earn in the bankruptcy courts.  When a client is represented by a board certified consumer bankruptcy specialist (there are only a dozen of us in the whole state of Indiana, court officials can rely on the information, knowing there are no "bad apples" or "bad information" involved!

Indiana's always been a big auto and RV manufacturing state when it comes to jobs. As part of offering Indiana bankruptcy information, I make a special effort in my bankruptcy blog to keep readers and bankruptcy clients up to date on the job market here.  I and the Anderson bankruptcy lawyers who work in my offices there know the important link between jobs and successful emergence from bankruptcy.

As a debt consolidation lawyer who's worked with trucking and auto manufacturing employees over the years, I've found that many of them  have needed payday loan debt help in additiion to help with personal bankruptcy in Indiana. But, in order for a debt repayment plan of any kind to succeed, there must be reliable income from jobs.

Just two weeks ago, I was calling the Indiana employment news "more gray than green", but today I am happy to report, good news seems to outweigh bad, at least when it comes to companies involving products with wheels.

"Analysts project a 25-30% increase in recreational vehicle sales in 2010, and that is starting to translate into more jobs in Indiana," reports the Indianapolis Star. RV and travel trailer manufacturing has fallen 60% since 2006, so it's good to hear things are turning around.  The Goshen area expects to add two factories before year end, and Heartland Recreational Vehicles of Elkhart is hiring 200 production workers now and 200 more in March.

As an Indianapolis bankruptcy lawyer, I was especially glad to read about a different "wheel-based" company's plans.  Republic Airways will be creating 300 jobs here next year, adding $15 million in payroll to the company's Indianapolis operations.  The new jobs will include dispatchers, engineers, crew schedulers, and operations positions, with the average annual salary being $50,000.

While the thousands of new jobs planned in Fishers don't relate to autos, RV's, or planes, I expect plenty of wheeled vehicles will be involved in the construction of the 900-acre technology park there.

The one rather "gray" piece of "wheel" news involves Indiana state government's layoff of 42 truck and school bus inspectors.

As I continue my work as a debt consolidation lawyer in Indiana, offering help to stop foreclosure, student loan debt help, and small business bankruptcy help, I know that the key to success in every one of these areas is Indiana employment.  That's why I find all this "good news on wheels" to be so welcome during this holiday season!
 

Only yesterday I blogged about mortgage modifications.  I listed all the reasons I believe the process could be so much more efficient and helpful to homeowners if, instead of banks and mortgage servicing companies "trying" (all the articles talk about how the failure of the program "isn't for lack of trying") to run a program for which they're ill-equipped, Congress allowed bankruptcy judges to take over and get the job done. 

If you thought that, as a bankruptcy attorney in Indiana,  I was exaggerating my criticisms of the way the mortgage modificatioin program has been working - or, more correctly, not working - so far, the Treasury Department's announcement a week and half ago should leave no doubt in your mind.

While more than 700,000 homeowners have signed up for modification help under Obama's Housing Help program, only 31,000 or so of these modifications have progressed to the "permanent" stage.  The Congressional Oversight Panel warns that "as currently structured, the program appears capable of preventing only a fraction of foreclosures."

Talk about "trying"!   For the past year, I, along with the Columbus bankruptcy lawyers who work in my office there (along with the Indianapolis bankruptcy attorneys in my office) have been trying, and trying, and trying, to help clients negotiate with their lenders on mortgage modifications.  Dealing with the mortgage servicing companies has been a very slow, frustrating process.

Even with all this worry and frustration, there's been a sunny side to the work in mortgage modification I've been doing as part of offering Indiana bankruptcy help. Many clients report is that, even when a mortgage modification is not granted to them by the lender, the very process of working with a legal professional to organize their financial information has helped them gain more control over their problems. 

How can that be?  Picture this: What I and my colleagues do is
 

• analyze your financial situation
• have skilled property appraisals run
• prepare the debt-income ratios necessary for the modification paperwork. 

All the while, you're getting a much clearer picture of what all your options are, not just concerning your mortgage, but your entire debt situation.

Know how they say "Seeing is believing"?  Sometimes just having a skilled, experienced professional help you see what the options are helps. Once you believe there's a better future ahead, you can start to make that better future happen!

Mortgage modification is a complicated matter, no doubt about it. Every day, searching for news relating to bankruptcy services in Indiana, I find a new article in the paper or online asking the question, "Why do so many home loan modifications fail?".  Invariably, the writer has reassured readers "it's not for lack of trying."   (It sounds as if they're asking why we're not taking an example from our first grade teachers, giving the federal government, the banks, and the mortgage servicing companies an "A" for effort! I hardly need to tell you - the adult world doesn't work that way.)

• Lenders don't request sufficient proof of income, and the modified monthly payments exceed homeowners' ability to pay.
• The modification terms are temporary and last only five years, then revert back to the original terms.
• The principal balances almost never are changed by the lenders.
• Gridlock - lenders' departments are overwhelmed.
• Scams - many firms are defrauding homeowners, promising to get mortgage terms mitigated.  After charging upfront fees, scammers disappear.

Only ten days ago, in my letter to the editor of USA Today, I expressed my view, as an Indianapolis bankruptcy attorney, that Congress should allow bankruptcy judges to deal in "mortgage cramdowns".  I explained that I and the Columbus bankruiptcy lawyers who work in the Mark Zuckerberg bankruptcy law offices there agree: despite our concerted efforts to help clients with mortgage modifications so they can avoid foreclosure, the process has been slow and cumbersome. 

The results have been very sad, I went on to explain.  Often, after months and months of non-response by the mortgage servicing companies, they claim to have lost the paperwork we submitted.  By the time the papers have been resubmitted and further weeks have gone by, certain bankruptcy options are no longer available.  I concluded my letter by saying that the bankruptcy court system is much better equipped to deal with mortgage modifications in a timely and efficient manner. 

In my view as a debt consolidation lawyer and bankruptcy attorney in Indiana for more than twenty years, every single one of the five problems Brenda Cote mentions would be less of an issue if handled through the bankruptcy system:

Problem #1:  Mortgage servicing companies haven't been able to verify debtors' income.

Efficiently verifyng and reporting income is one of the standard steps I handle every working day, one which is integral to the bankruptcy court system.

Problem #2:   Modification terms are only temporary, and Problem #3:  Principal balances are almost never changed.

Bankruptcy courts would have the power to deal with mortgage lenders in the same manner as other secured creditors, including permanent reductions of principal balances where appropriate.

Problem #4:  Gridlock in mortgage servicing staff procedures.

Unlike lender personnel, who are largely untrained in modification procedures, handling debt is what bankruptcy attorneys and bankruptcy courts do every day.

Problem #5:  Foreclosure scams.

The very fact of having the mortgage modification done under the supervision of a federal court system would dramatically reduce scams.

"I can only hope that many other voices will make themselves heard, so thatmortgage modifications can be more effective - and a lot more timely!"  That's what I wrote to the editor.  The message I was trying to convey was this:

It's not "trying" that gets the job done - it's efficiency and professional expertise. Please, Congress - let's give the "A" to the professionals who are trained in debt modification through the U.S. bankruptcy law system!