The North Carolina Bankruptcy Information Blog

It’s after Halloween, so you know what the means don’t you? Of course, it’s time for winter holiday shopping. When you put away that “sexy cop” costume, just reach one box over and grab the house decorations.

So this year’s shopping season should say a lot about the state of our economy. Will it signal an actual comeback, fall short of “analysts’ expectations” or signal that 2011 is going to be another rough one?

Well, if we know one thing from recent shopping metrics, it’s that, at least to some extent, we will be able to attribute a decline in consumer good purchases on that ever-popular present and glaring indication of just how little thought we really put into gift giving … the gift card.…

Okay, it’s time for some motivation.

Coming out of bankruptcy, or at least the feeling of resolution that comes when the cloud of economic despair finally lifts, can do a lot for a person’s psyche and sense of self. Like a new breath after a long-time struggle in financial whitewater, knowing you are free of what has been pulling you under can empower you to try new things, pursue goals and live your dreams. So, in honor of that great feeling, let’s use this post to discuss ten things that you might hear when its time to get back on track toward leading the life you have always wanted.…

It would be inauthentic to blame every instance of bankruptcy on sudden life changes, such as a tragic illness or other life-altering emergency. The truth is, some bankruptcies are preventable.

However, we’re not judging. We know that timing plays a big part.

For example, let’s say one morning that you look at the pile of bills on the counter and say to yourself: “That’s it, I’m changing the way I handle money.” Then, the first thing noticed on your desk at work is a pink slip. That folks, is bad timing. And it explains a lot of personal bankruptcies.

What if you never you had that pile of bills?…

While many people consider it common knowledge, the last-minute fear before deciding to file bankruptcy could end up costing you even more come retirement. Turns out, that as the recession deepens, more people are looking toward their long-term savings for an influx of cash to help stay afloat.

Well, don’t ever be one of those people. Typically, what ends up happening is that you wind up without retirement money and still filing bankruptcy. We’ve seen it happen. And it’s hard to watch.

An article on USAToday.com pointed to figures that show a record number of people in the second quarter of this year used their retirement accounts to help stave off a financial problem.…

Regardless of your current financial situation—from good credit to no credit—there’s no denying that we’re living in a tough housing market. So if you’re considering bankruptcy, you might think that if it’s a challenge to become a homeowner for those in the best financial times, it might be next to impossible to acquire your dream home if you’re currently recovering from a Chapter 7 or 13 bankruptcy filing.

The hard and fast truth is that getting your financial house in order following your bankruptcy, especially in order to qualify for a mortgage loan to get the home you want, is more possible than you think.…

The job market is a tough, ugly and sometimes downright brutal place to have to spend time. Heck, July alone crammed well over one hundred thousand into an already really tight space.

The signs you see to help yourself out—job postings—are all over the place it seems. But who’s landing them? Well, maybe this post can help you be the next person who finds their way back into the world of the employed.

According to an article on CNN.com, employment experts agree that one of the most critical things a person can do when applying for a job is craft their resume to the specifications asked for on the job posting.…

During the mid-2000s, housing prices reached stratospheric levels with mortgage lenders more than willing to be liberal with their loans, selling the idea of the “home as American Dream” to anyone who would listen—whether they were qualified or not.  But, if the recent housing crisis has taught us anything, it’s that home ownership isn’t always what it’s cracked up to be.

So, after the recent mortgage meltdown, many are wondering: “where do we go from here?”

That’s the very question asked in a recent report by NPR. In it, correspondents found that after two decades of expansions in home ownership—fostered by government mortgage guarantees by the now much-maligned likes of Fannie Mae and Freddie Mac—many policymakers are looking at housing finance reform as a top priority to the nation’s prospects for economic recovery.…

Just a few years ago, home ownership was something available to just about anyone—an economic reality that to an extent, contributed to where we are today. Nevertheless, the mortgage boom helped a lot of people realize that benefits of home ownership. It’s simply too bad that it came with so many hidden financial pitfalls, many of which have subjected sub-prime borrowers (and also those with standard mortgages) to serious, long-term hardships.

Today, almost the exact opposite has become reality. Mortgages are exceptionally more difficult to obtain and when they can be approved, the houses themselves don’t qualify because of drastically diminishing real estate values.…

Debtors attempting to avoid bankruptcy by waiting for housing prices (and equity) to increase may be waiting a long time. In fact, according to The New York Times, wealth-building via housing booms may have also gone the way of guaranteed pensions, free healthcare, and secure employment.

Per the NYT, “many real estate experts now believe that home ownership will never again yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg. The wealth generated by housing in those decades, particularly on the coasts, did more than assure the owners a comfortable retirement.…

Realizing we are in debt is a lot easier than figuring how it happened. Unless you can pinpoint one central reason, like the loss of a job or long-term medical issue, it can be hard to retrace your steps to financial crisis. Plus, who even wants to? The more important exercise is to figure out how to not let it happen again. And that means determining why you overspend so you can change your habits in your life after bankruptcy.

Countless consumer studies have been done about why we spend. From psychological influences to marketing, music and social pressure, there are far too many things impacting our spending decisions.…

Chapter 13 bankruptcy can be a great way to clear your financial slate, while, at the same time, entitling you to hold on to your precious property even in the most precarious economic situations. To do so, Chapter 13 bankruptcy allows you to construct what is hopefully a realistic financial reorganization plan that allows you to pay back all of your debts over the course of three to five years.

In part one of the series “Creating a Realistic Chapter 13 Repayment Plan,” we discussed how an unrealistic Chapter 13 repayment plan (i.e., one that is poorly designed, doesn’t account for unexpected expenses, and one that doesn’t keep your lawyer in the loop, combined with the debtor’s inability to stay inside a repayment ‘budget’), can lead to Chapter 13 failure.…

Chapter 13 bankruptcy involves the facilitation of a financial reorganization plan that allows you to pay back your expenses over the course of three to five years. As a result, a Chapter 13 bankruptcy also requires that you look ahead three to five years in order to construct a realistic and sensible plan that can work for you.

Unfortunately for many people who are bankruptcy bound, the future is far from unclear. And, just as many circumstances can occur that exacerbate your financial present and force you into bankruptcy, the same unexpected scenarios—from a job loss to a medical emergency—can cause your Chapter 13 reorganization place to fail.…

It seems that in today’s difficult economic weather, just about everyone is a risk for a lender.

Earlier this month, FICO, Inc. (the company that develops credit risk metrics) reported that America’s collective credit score is at an all-time low. Close to 43.4 million consumers have a credit score at or below 599, which is the risk benchmark for the majority of lenders. This means that more than 25 percent of us are likely to not get a car loan, new credit card (really?) or a mortgage.

FICO arrived at their conclusion through an analysis of April’s consumer credit reports. Historically, only 15 percent of all “credit-active” consumers fell below the 599 mark.…

Life after bankruptcy can be a challenge. It will take commitment, a new mindset and an entirely fresh set of budgeting habits.

People are surprised to find that when they look around, there really are countless ways for you to save, establish credit and rebuild the economic life you once had.

For a some filers, bankruptcy meant giving up a car payment you could no longer afford. With the new change, getting around town to run errands or schedule job interviews can be pretty frustrating. However, alternative modes of transportation are becoming more abundant. One example is the WeCar program, an idea already popular in larger cities and on college campuses.…

For many people, divorce can cause a huge financial strain in already tough economic times. In others cases, it’s the crushing weight of debt that leads to the dissolution of a marriage.  Whatever the ultimate cause, and effects, when considering bankruptcy amid a divorce it’s important to know a few basics.

Divorce Decrees and Bankruptcies
Because your bankruptcy only includes debts in existence at the time of your bankruptcy filing, a subsequent divorce decree (i.e., a divorce decree following the date of your bankruptcy petition) remains intact and won’t be included in the debt dispensed by your bankruptcy. While few attorneys would urge you to continue in a bad relationship for money, some good advice might be to time your bankruptcy filing so that it follows (and includes) the divorce decree or separation agreement.  Keep in mind that only Chapter 13 bankruptcy discharges debts and equitable distribution obligations, as long as they are not considered alimony or child support or in lieu of either kind of domestic support.  Sometimes, obligations to pay the other spouse’s attorney fees related to the separation or divorce might sometimes be considered domestic support obligations and therefore non-dischargeable. 

All obligations under a separation agreement remain intact and enforceable after a Chapter 7 bankruptcy, as Chapter 7 does not afford the debtor a discharge of any separation or divorce-related obligations.…

For most recent college and post-college graduates, the hot summer months are a chilly reminder that student loan repayment deadlines are mere months away. These impending debts arrive at some of the toughest economic times ever for the newest round of job seekers, as the nation, and especially its youngest workers, continue to face record unemployment and mounting consumer debt. So what happens when poor economic conditions coincide with mandatory payback timelines for budget-busting student loans? Two words: loan defaults. Now, the countdown is on as many recent grads will soon exceed the 270-day window for paying back their educational debts, beginning a bad precedent for staying current in an economy that may or may not be heading into another recession.…

Bankruptcy Myth #1: You won’t receive credit offers after your bankruptcy.

Don’t be surprised to receive many credit offers following your bankruptcy. Car lenders, mortgage financiers, credit card companies and more, often line up for the chance to provide post-bankruptcy debtors with all types of consumer spending opportunities.

Bankruptcy Myth #2: Taking creditors up on all of their offers is a good thing.

These same lenders and card companies are also coming forward to capitalize on the clean financial slate your bankruptcy provided.  Unfortunately, many of these so-called “helpful” creditors are actually subprime lenders targeting average Americans just like you who are attempting to improve their credit and get back on their financial feet.…

Despite the rumors, stigmas and innuendo, there are a number of things you can keep after filing bankruptcy. Your car, for example, is something that you may be able to keep, provided your debt issues running up to your bankruptcy did not result in a repossession and the equity in your car can be protected with available exemptions.

If you were financing (purchasing) a car when you filed Chapter 7 but did not plan to surrender the vehicle in your bankruptcy, and you continued to keep current on the debt through filing your case and afterwards, you will need to fill out and sign something called a “reaffirmation agreement.” This legal document certifies that you will agree to repay all or a portion of that particular auto loan debt since it would otherwise be discharged along with your other debt.…

In the last ten years, self-storage centers have infiltrated America faster than a bad singer on YouTube. From basic storage sheds with individual bays to climate-controlled multi-story complexes, we have become a nation obsessed with storage. Heck, you can even invest in a garage condo today.

Now, let’s juxtapose our need for storage with the general financial position of so many American families right now. There is really no more proof of our collective love of useless consumer products than the need to pay $100 month just to store it.

And if it’s not in a storage facility, it’s pushing the car out of the garage.…

In the new HBO series Treme, viewers follow the lives of New Orleans residents a mere three months following the physical, emotional and economic devastation of Hurricane Katrina. The cast of characters represents a cross-section of ordinary New Orleanians—from police to piano players—trying to rebuild their lives, their homes and their unique culture in the aftermath of the 2005 storm. Like a bellwether for our nation’s tough financial times, Treme captures the proverbial “perfect storm” that led to one city’s economic fallout, full of stark imagery of people losing everything and attempting to rise from the ashes in any way they can.…