A story in the Green Bay Gazette reaffirms that there is life after an individual bankruptcy in Wisconsin. Robert Jahnke filed bankruptcy in the 90s owing to a divorce along with crushing business debts and an inability to negotiate appropriate payment arrangements with his creditors. In the process, he lost his travel agency business and his credit rating went into the tank. Sometime after the bankruptcy, the article reports, he went back and voluntarily paid off his creditors, but was still unable to get business loans.
While working in a prison, he self-financed a door-to-door marketing business. After selling that business, he started PrePaid Legal and later TopHat Marketing. He quit the prison job in 2001 to devote full-time to his entrepreneurial ventures. Jahnke also found the time to help start Helping Business Build Assets (HBBA), a non-profit business networking group.
Here's what Jahnke says to those individuals who might similarly be in need of debt relief in Wisconsin: "Having experienced a bankruptcy, he recommends that businesses do everything possible to avoid it. That means getting help early, being upfront with creditors and refinancing debt payments. But, if a bankruptcy is necessary, he wants others to know it isn't the end of the road."
Never give up the dream of starting a new business venture after bankruptcy, he adds, even if that means starting small. "I read that Col. Sanders went to 1,000 places before he got a loan for his chicken."
While it didn't happen overnight, Jahnke evidently worked closely with his debt consolidation lawyer to get back on his feet and again become successful. So if you are being hounded by creditors to the point that you need to consider a personal bankruptcy in Milwaukee or elsewhere, remember that in all likelihood you can survive and thrive after seeking bankruptcy protection.
Another indicator of ongoing economic difficulties: A high-tech company that moved to Wisconsin to gain the benefit of tax incentives has filed for a Chapter 7 bankruptcy liquidation.
Biotechnology company VitalMedix Inc., a spin-off from the University of Minnesota, moved its operations to Hudson, Wisconsin, last year to take advantage of the state's tax incentives for start-up technology firms. However, VitalMedix was unable to raise additional needed venture capital in a weak economy. The company was in the process of developing a drug therapy for use by first responders or military medics that could keep patients temporarily alive even if they suffered catastrophic blood loss such as soldiers wounded in a bomb attack or a motorist involved in a major car accident. VitalMedix was one of seven technology companies that got a lot of fanfare when they moved to Wisconsin in October.
The company reported $51,000 in assets and about $917,000 in debts prior to going Chapter 7 and transferring its technology back to the university. The company apparently needed about $15 million to avoid going under. It has now officially ceased operations. A creditors' meeting in bankruptcy court is scheduled for March 25th.
Like an individual might do in an individual bankruptcy in Wisconsin, VitalMedix plans to liquidate its remaining assets. Wisconsin residents at all income levels have different reasons for considering a Chapter 7 bankruptcy in Milwaukee or in the surrounding area. If you need debt relief in Wisconsin regardless of the amount in question, consider discussing your specific situation with a Wisconsin bankruptcy attorney.
For consumers seeking debt relief in Wisconsin, Green Bay's WFRV-TV and WFRV.com warns state residents about doing business with fly-by-night debt consolidation companies, many of whom advertise heavily in the media. Complaints to state and local government regulators about these firms--who sometimes take the money and run--are apparently on the increase.
The Wisconsin Better Business Bureau says that some of the companies promising to settle mortgage, credit card debt, or other bills are legitimate, but consumers need to be wary of certain red flags. For example, never pay large upfront fees to the debt consolidator; instead, use that money to pay off the underlying debt. Also, it may be more effective for the consumer to negotiate directly with the creditor to set up a reasonable payment plan rather than pay an intermediary to do so. A Better Business Bureau official also suggested that consumers stay skeptical of any broad guarantee by a debt consolidation company along the lines of eliminating 40 to 70 percent of the outstanding debt.
Every Wisconsin debt consolidator must obtain a license from the state Department of Financial Institutions. Any consumer who wants to research a debt consolidation company can access the Department's records as well as checking with the Better Business Bureau for a complaint history, if any.
Another option for the consumer is to meet with a skilled and experienced bankruptcy attorney in Milwaukee to review your balance sheet. An individual bankruptcy in Wisconsin could be best approach in difficult circumstances. A Wisconsin bankruptcy lawyer is subject to strict ethical rules, including putting the best interests of the client at the top of the priority list. Rather than getting mixed up with an iffy-at-best debt consolidation company, seeking counsel from a professional debt consolidation lawyer can be a better alternative. Your lawyer can present with authority a financial framework for going forward that may or may not include a personal bankruptcy in Milwaukee or in the surrounding area.
Following-up the previous blog entry, entrepreneur and blogger Nathan Hanks further discussed the mounting debt crisis that threatens to engulf America:
The national debt is approaching 100% of Gross Domestic Product (GDP) while federal tax revenue is only 27 percent of GDP. As a country, our debt is 3.7 times greater than annual government tax collections.
Let's use a character--we'll call him Sam--as an example. If Sam takes home $100,000 per year and his debt was $370,000, what type of shape would he be in? It depends on how much of his income was available to pay down his debt. If he could use his total income (which would be impractical), Sam could pay off his debt in 3.7 years!
The U.S. is running a deficit. On an annual basis, the country spends more than it takes in from taxes. According to Wikipedia, the total deficit for fiscal year 2009 was $1.42 trillion, a $960 billion increase from 2008. The deficit is supposedly forecast to decline to $1.17 trillion in 2010 and $533 billion by 2013.
So back to Sam. He is spending more money each year than he is earning. Sam makes $100K per year. He has irresponsible spending habits and spends $100K+ each year. And he carries $370K in total debt. [Sam might wind up being a candidate for a personal bankruptcy in Milwaukee if he isn't careful.]
Do you know someone like Sam? Nice cars, nice clothes, and a steak on the table? But it's a house of cards. It may look nice when you come to visit, but Sam (i.e., Uncle Sam) knows there is a big problem. Sam might need the services of a Wisconsin bankruptcy lawyer before long.
Are there any possible fixes on the national horizon? One approach is to expand the economy--if the economy grows (through entrepreneurial innovation and risk-taking) and tax rates stay the same, the government will take in more money. Another is to increase taxes, but that can pose disincentives to economic expansion. The government could also print more money, but increasing the money supply could ignite inflation and reduce consumer purchasing power. Sam (Uncle Sam) could also sell off government assets and property to raise revenue as long as national security isn't implicated.
"Within12 years…the largest item in the federal budget will be interest payments on the national debt," former U.S. Comptroller General David Walker told ABC News earlier this month. "[They are] payments for which we get nothing."
ABC News also says that in a poll that network recently took, 87 percent of Americans expressed concern about the federal budget deficit and national debt, and most strongly disapproved of how Washington politicians are handling the situation.
Given the ongoing economic recession, families are encountering extreme challenges in managing their household income and obtaining debt relief in Wisconsin. For this reason, consumers have been forced to give serious condition to a personal bankruptcy in Milwaukee or an individual bankruptcy in Wisconsin with the assistance of a qualified debt consolidation lawyer. On a massively larger scale, the federal government, too, is drowning in red ink. Blogger Nathan Hanks has outlined the implications of the staggering debt crisis in Washington that ultimately affects every citizen:
For example, in 2006, Professor Laurence Kotlikoff of Boston University argued the U.S. must eventually choose between "bankruptcy," raising taxes, or cutting payouts. He assumes that there will be ever-growing payment obligations from Medicare and Medicaid. Other notables who have attempted to bring this issue forward include Ross Perot in his 1992 Presidential bid, to motivational speaker/financial guru Robert Kiyosaki, and David Walker, former head of the U.S. Government Accountability Office (GAO), among many others.
The GAO, which functions as the federal government's auditor, argues that the U.S. is on a fiscally "unsustainable" path, and that politicians and the electorate have been unwilling to change this path. The 2010 budge indicates annual debt increases of nearly $1 trillion annually through 2019. By 2019, the U.S. national debt will be about $18 trillion (it's about $12 trillion now), approximately 148 percent of the 2009 Gross Domestic Product. The GDP is the total of all goods and services annually produced in this country. Further, the subprime mortgage crisis has significantly burdened the U.S. government to the tune of $10 trillion in commitments and guarantees.
The U.S. is also running a large trade deficit (i.e., imports exceed exports). Financing these deficits requires the U.S. to borrow heavily from abroad.
To try to process the magnitude of what the country is facing, see the real-time U.S. National Debt Clock. The likelihood is that the U.S. will bounce back from this recession, but the long-term picture is far from clear.
Have you reached the point of no return when it comes to financial difficulties? Making the decision to file for an individual bankruptcy in Wisconsin is not to be made lightly. It's difficult for many consumers--especially given widespread unemployment and plummeting home equity-- to really come to grips with their financial picture. With that in mind, here is a list (suggested by Los Angeles attorney Christine Walton) of some warning signs that it may be time to seek counsel from a Wisconsin bankruptcy lawyer:
You've emptied your entire bank account to pay bills and are considering tapping into your IRA for the same reason
You're using plastic to as a short-term fix, but the card balance is getting entirely out of hand
Your rent or mortgage is seriously overdue
Debt collectors call you more often than your own family
You can barely pay more than the minimum payment on your outstanding debts
You're about to lose your car to the repo man
If these challenges sound familiar, declaring a Chapter 7 or Chapter 13 in Milwaukee may perhaps be the next logical shoe to drop. Bankruptcy protection in federal court under the bankruptcy laws of Wisconsin can allow a consumer to clear a lot of debt off the books and start anew. A no-obligation candid assessment of your situation by a debt consolidation lawyer may be the first step towards much-needed debt relief in Wisconsin.
This blog often addresses the careful decisonmaking that may or may not lead a debtor to an individual bankruptcy in Wisconsin. But in certain circumstances under the bankruptcy laws of Wisconsin, a creditor can go to federal court to force a debtor into Chapter 7. This is called an involuntary bankruptcy, but it is not all that common because it comes with various technical strings attached.
Under the law, if a debtor is on the hook for about $10,000 or more to 12 or more creditors, three of the creditors must join forces to file the involuntary bankruptcy petition. If the debtor has less than 12 creditors, then only one of them need file, again provided at least $10,000 in debt is at issue. Also, the creditor(s) must provide evidence that the debt or debts in question are undisputed and that the debtor is in default on the obligations.
Why would a creditor go to all the trouble of filing involuntary bankruptcy papers against a consumer? Perhaps creditor might be concerned that a consumer is going on a spending spree (perhaps in anticipation of a bankruptcy filing down the road) rather than pay overdue bills. Another reason might be a concern that the debtor is hiding assets or parceling out money or property so that there is nothing left for creditors to seize. But going in this direction can be a risky proposition for the creditor. If the bankruptcy court decides that the involuntary petition was filed in bad faith or has no basis, the petition can be dismissed and the court can turn the tables on the creditor and order it to pay damages and legal fees to the debtor. By the way, farmers can't be dragged into an involuntary bankruptcy by law, so if you're a farmer, that's one less thing you have to worry about in today's difficult economy. Nor does an involuntary bankruptcy apply to a Chapter 13 bankruptcy in Milwaukee or elsewhere in Wisconsin.
The bankruptcy court gives the debtor an opportunity to respond to an involuntary petition before determining which, if any creditors are entitled to debt relief in Wisconsin. If you've been targeted for an involuntary bankruptcy, you need the services of a Wisconsin bankruptcy lawyer right away. A Milwaukee bankruptcy attorney can size up your situation and put together a response to the court that will, if appropriate, contest the involuntary bankruptcy attempt and otherwise protect your financial interests from overreaching creditors.
In a previous blog entry, I mentioned that a bankruptcy filing in U.S. bankruptcy court must contain a complete inventory of assets, income, and debts. To conceal any information is a federal crime. That being said, keep in mind that April 15 is right around the corner. Before we know it, tax season will be upon us, and one of your bankruptcy assets could be an anticipated federal (or state) tax refund--even if you don't actually have "possession" of it yet. If you are gearing up for an individual bankruptcy in Wisconsin, your bankruptcy "estate" (i.e., all your property that could be pooled to pay off your outstanding debts) must include the anticipated refund as a line item even if your tax return is as yet unfiled. If you're not 100 percent sure about what, if anything, you'll get back from the government, this entry can be listed as a "possible tax refund" in the paperwork.
In some instances depending on the amount of the payment and/or other factors, the tax refund may possibly be considered exempt property that you can keep depending upon the bankruptcy laws of Wisconsin. As they often say on TV, however, "don't try this at home." This is the kind of complex legal technicality that only a seasoned Wisconsin bankruptcy lawyer can figure out. But as mentioned above, the first thing is to make sure you have informed your Wisconsin bankruptcy counsel or debt consolidation lawyer that you are expecting a refund for overpaying your taxes.
Although the employment rate has apparently dipped a bit under the latest government statistics, the economy has yet to dig itself out the hole. Against that backdrop, bankruptcies appear to show no sign of slowing down. Case in point: Neenah Enterprises, Inc., one of the largest independent foundries in the U.S., filed for bankruptcy protection this week. The Neenah, Wisconsin, based company has been operation since 1872 and is best known for making manhole covers and storm grates. In its Chapter 11 filing with the bankruptcy court, the company reported debts of nearly $450 million and assets totaling about $286 million. The company says it has cut deals with major creditors to reduce its debt load while still paying suppliers and vendors. It also has arranged for an additional $140 million in loans that will allow it to stay in business pending court approval. Company representatives also said that it will emerge from the Chapter 11 reorganization in better financial shape and without the need to lay off any workers, which is good news for its 800 employees in Wisconsin.
These are challenging times for business and households who may be seeking debt relief in Wisconsin. For individual consumers who may be out of work or have other serious financial burdens, a Chapter 7 or Chapter 13 bankruptcy in Milwaukee or in the surrounding area can be a way to look with hope to the future. A qualified, experienced bankruptcy attorney in Milwaukee or in other Wisconsin cities can explain the options that are available under the bankruptcy laws of Wisconsin and develop a solution geared to the individual client, whether that client is an individual or a business.
This blog often addresses the events leading up to an individual bankruptcy in Wisconsin or the bankruptcy process itself. But what about the aftermath?How do you rebuild your credit rating? It's impractical to try to pay cash for everything going forward so rebuilding credit is a priority simply to function in the marketplace. Woman's Personal Finance.net has three tips that may apply regardless of gender.
First, get a secured credit card. The card gets its name because it is secured by a deposit account that is directly linked to it. Your credit limit is usually roughly equivalent to amount of cash that you've deposited; the card issuer will tap into this account if the consumer defaults on his or her credit card balance. Secured cards tend to charge higher fees and interest rates that the ordinary credit card, so investigate the card issuer thoroughly to make sure it is a reputable one. Once you establish a track record of paying off your balance on time, you can likely switch over to a regular card.
Second, join a credit union, which is a non-profit equivalent of a bank but owned by its members rather than a bunch of stockholders. Credit unions often have better deals and promotions than traditional banks, such as lower interest rates on small loans that can reestablish your creditworthiness.
Third, although this may not be for everyone, consider joining a support group to remind yourself that you're hardly the only one trying to restart after a Chapter 7 or Chapter 13 bankruptcy in Milwaukee: "A support group, either live and in person (if available) or via the Internet, is a perfect way to help you deal with what’s going on."
A qualified legal specialist such as a Wisconsin bankruptcy lawyer can provide advice about post-bankruptcy credit issues as well as responding to any of your other Wisconsin bankruptcy questions.
New credit card rules are going into effect soon, and because of this, you've probably been receiving some notices from your credit card issuer with a lot of fine print and legalese. As of February 22, your credit card statement will start to contain new information as required by the federal Credit Card, Accountability, Responsibility and Disclosure Act of 2009. One key change mandated by law: credit card statements will now show how long it will take to pay off your balance if you only make the minimum payment each month. The goal of this new disclosure requirement is to encourage consumers--if they can--to make larger payments to bring down their credit card debt faster before the interest gets totally out of hand.
A National Foundation for Credit Counseling official calls this a potential game changer for consumers, according to the Milwaukee Journal Sentinel: "We are extremely hopeful that seeing your financial situation staring you in the black and white will move people into action. A lot of folks bury their head in the sand and don't face the financial facts."
Taking action may mean obtaining Wisconsin bankruptcy information from a qualified legal practitioner. If you are able to pay off your balance in full each month, you're in great shape. But if you're running a large credit card balance and only have the ability to make minimum payments, it may take until the next Ice Age before the account is paid up. This may be a signal to review your financial situation with a debt consolidation lawyer. If your back is up against the wall in connection with credit card debt or other obligations, a consumer bankruptcy in Milwaukee or elsewhere in Wisconsin may be worth considering. A Chapter 7 individual bankruptcy in Wisconsin can be one way to discharge your unsecured debt and start fresh.
About 50 General Motors and Chrysler car dealerships in Wisconsin who where to shut down as part of last year's massive government-financed bankruptcy are trying to get back in business. Under a federal law that was enacted in December, the dealers have the right to go to challenge the automakers' decision to target some dealerships for elimination and not others. Apparently Wisconsin ranks number 10 in the country in the number of dealerships filing for arbitration. Many dealers argued that the corporate decision making was random and unreasonable.
An arbitration is a trial-like hearing that is presided over out-of-court usually by a retired judge or a lawyer with particular conflict-resolution and technical skills. About 1,500 of the affected dealerships (more than 50 percent) across the country have filed for arbitration with the American Arbitration Association to get back their franchises. The hearings are scheduled to begin in March and wrap up by June.
GM filed for Chapter 11 bankruptcy protection in June 2009--the fourth largest bankruptcy in U.S. history and the largest for an industrial corporation. The federal government currently owns 60 percent of GM. Chrysler went bankrupt in April 2009.
Dealerships that have a successful outcome in arbitration could presumably help improve the state's employment picture. To some degree, more jobs could have a positive impact on residents who might otherwise be considering an individual bankruptcy in Wisconsin or looking into other forms of debt relief in Wisconsin. 0 Comments »
An unresolved personal injury claim can pose a potential snag when a consumer considers an individual bankruptcy in Wisconsin. Typically, this may involve a situation where you've unfortunately been injured in a car accident and you have an outstanding claim against the other driver for money damages. In fact, it may be unpaid medical bills and lost income as a direct result of the accident, along with other factors, that might push a consumer into Chapter 7 in the first place.
If you do have a claim pending against the responsible party for negligence or another related civil allegation, even if you have yet to file a lawsuit in state court, you must include the claim as an asset in your bankruptcy paperwork. The court-appointed federal bankruptcy trustee will then evaluate the claim. If the personal injury case appears solid, the trustee will step in your shoes; whatever cash settlement or judgment that might emerge will become property of the bankruptcy estate. The proceeds will be paid out to your creditors in the course of the Chapter 7 liquidation, although you are entitled to what's left over, if anything, after the discharge. The trustee will review the claim with your personal injury lawyer, and that lawyer may continue to handle the file on behalf of the trustee. On the other hand, if the trustee determines that the claim is marginal, the trustee may decide against pursuing it. If that occurs, you and your personal injury lawyer can press the claim as if there is no bankruptcy involved. But the trustee, rather than the injured party, is by law in control of the decisionmaking once you filed the bankruptcy petition.
In the pre-bankruptcy phase, any consumer will have lots of Wisconsin bankruptcy questions. In the kind of scenario outlined above, there are lots of technicalities that can't be fully addressed here, so it is essential to obtain the guidance of a qualified Wisconsin bankruptcy lawyer right from square one. It's your bankruptcy attorney's job among other things to run interference for you in connection with both the bankruptcy and the personal injury matters. At all times, full compliance with the bankruptcy code is at the top of the priority list.
As we put 2009 in the rear-view mirror, final numbers show that bankruptcies filed in Wisconsin (both the Eastern District and Western District U.S. bankruptcy courts) totaled
27,413--a 30 percent increase over 2008. The vast majority (80 percent) were Chapter 7 petitions. Wisconsin bankruptcy filings jumped by an astounding 65 percent since 2007. And going forward, as the Milwaukee Journal Sentinel points out, underemployment in addition to unemployment looms large: "Bankruptcy lawyers noted it's not only layoffs and firings driving people to insolvency as the economic downturn drags on. The losses of once-regular overtime pay and full-time status have left consumers unable to stay current on monthly payments that in the past were no problem to handle." Lost or limited income would also suggest that Wisconsin bank foreclosures will continue to multiply as more jobless homeowners have difficulties keeping up with monthly payments.
Hopefully, Wisconsin residents who are currently out of work or underemployed will find greater success in their job hunt in 2010. But any consumer behind the economic eight ball may find that this could a good time to speak with a debt consolidation lawyer about various options, including an individual bankruptcy in Wisconsin. A Chapter 7 or Chapter 13 bankruptcy in Milwaukee may not be in the immediate future, if at all, but getting answers to your Wisconsin bankruptcy questions may be a valuable starting point for your prospects of obtaining debt relief in Wisconsin.
An article posted at the Dallas Observer website tells of a man on the hook for $100,000 in debt who has created what amounts to a cottage industry in filing lawsuits against debt collection agencies: "While most Americans with unpaid bills dread the collector's call, Cunningham sees them as lucrative opportunities. Many collection and credit car companies, intentionally or not, violate little-known consumer rights laws, and Cunningham's favorite pastime is catching them doing so and then suing them. In fact, it's a profitable side job."
Collection agencies must live up to the Fair Debt Collection Practices Act and other federal and state consumer protection laws. For that reason, it is a good idea to keep records of your interactions with these agencies if they begin to harass you. The federal FDCPA law prohibits abusive and deceptive conduct by a debt collector. A quick Internet search on this topic will explain what qualifies as prohibited conduct.
If the underlying debt(s) are valid, however, it may be a better and less-stressful approach to address your financial obligations before they get turned over for collection. According to the article, Americans owe an astounding $2.5 trillion in consumer debt, and that isn't even counting home mortgages. In this financial environment, many well-meaning Wisconsin consumers have found themselves buried in debt as a result of economic hardships. If the wolves are at your front door, a debt consolidation lawyer can provide expert advice about how to wipe that debt off the books, including whether a Chapter 7 or a Chapter 13 bankruptcy in Milwaukee makes sense in your situation. Separately, a Wisconsin bankruptcy lawyer can also help you decide if collection agencies violated the law when contacting you, and if it's worth going after them in court.
Each and every bankruptcy filing must by law contain a complete inventory of debts and creditors. It is against the law to conceal any financial info--it constitutes a crime. To obtain a full discharge of debts in a bankruptcy, your list must be all-inclusive. But with so many things going on, it is entirely possible that an honest consumer seeking debt relief in Wisconsin could accidentally leave out a debt from the court petition. If you are pursuing an individual bankruptcy in Wisconsin, and a debt comes to your attention after the fact, notify your lawyer immediately. Your attorney can file an amendment reflecting the new information with the court (there are additional court fees for doing so). If a bankruptcy has already been granted under Chapter 7 or 13, however, the debtor is on the hook to that particular creditor for the entire amount. You may also be required by the court to reopen your case, depending upon the circumstances to add that creditor to your schedule. One footnote: in a no-asset Chapter 7 bankruptcy (one where the debtor has no property that can be liquidated in favor of creditors), the debt in question might be considered discharged even if it wasn't listed. The proper way to address a missing debt depends of course on the specific nature of the case and the required court procedures. And again, this is a scenario where the consumer in good faith legitimately forgets about a debt, not a situation involving someone who tries to game the system. In the latter case, a criminal prosecution is likely.
So if you are considering a Chapter 7 or Chapter 13 bankruptcy in Milwaukee or the surrounding area, make sure to thoroughly review your personal papers right from the start in close consultation with your Wisconsin bankruptcy lawyer. Then, if something pops up later, contact your attorney immediately so that it can be promptly addressed within the bounds of the bankruptcy laws of Wisconsin.
A lot of people out there are looking for work, and perhaps having an individual bankruptcy in Wisconsin on their credit report may not seem like the greatest credential. One of your Wisconsin bankruptcy questions might be how would it affect, if at all, your ability to find a new job. Fortunately, under the bankruptcy code, it is illegal for employers to discriminate against job applicants or employees because they've filed for bankruptcy. Hiring decisions can often be subjective and take many factors into consideration, so it may be hard to prove that a worker was turned down for that one reason. To further strengthen employee rights, Wisconsin's legislature has a bill under consideration that would add credit history to the list of discriminatory employment practices prohibited by state law. Job applicants also have certain additional rights provided by the Fair Credit Reporting Act.
Typically, prospective employers might run a credit check as a condition of employment if a person applies for a job as a bookkeeper, or handles cash, or some such. In general though, more employers are using pre-employment credit reports as part of the hiring process particularly if credit status is job related. One size definitely doesn't fit all, but some HR professionals suggest that you might put your cards on the table during a job interview depending upon the circumstances. That way, a bankruptcy doesn't pop up as a surprise in the subsequent background screen. Given the tough economic times, a prospective employer might be willing to cut a worker who has sought debt relief in Wisconsin some slack. A qualified candidate with a strong work performance history who has gone bankrupt may not act as a deal breaker, especially if the bankruptcy was prompted by reasons other than mere financial irresponsibility. Also, job applicants who have wrapped up their bankruptcy case should monitor their credit reports to make sure the information is updated. It may take a couple of months for your credit report to reflect that your various debts have been discharged in the bankruptcy process.
If you feel that some unfairness has occurred in your job hunt, speak with your debt consolidation lawyer about what recourse you have under the bankruptcy laws of Wisconsin.
Bankruptcy protection cuts across all walks of life and income brackets. A previous blog posting summarized Oscar winner Nicolas Cage's vast financial problems. Another case in point: former NFL quarterback Bernie Kosar. Last week, a Florida bankruptcy judge converted his Chapter 11 case to a straight-up Chapter 7 liquidation at the request of the court-appointed trustee. This means the trustee will sell off Kosar's property and distribute the proceeds to his creditors in an attempt to satisfy at least some part of his outstanding obligations. In his bankruptcy documents, Kosar listed about $9 million in assets but almost $19 million in debt. Among other debts, he apparently owes his ex-wife $3 million from a divorce settlement and $1.5 million to the Cleveland Browns, the team where he made most of his reputation in the mid-80s through the early 90s. Kosar is also said to be on the hook to a bank for $9 million in bad real estate deals. His restaurant business went under last year.
At least from the outside, Kosar's lifestyle would seem to set him far apart from the most people. While most financially stressed consumers aren't facing red ink of this magnitude, that in no way minimizes what Wisconsin families have been dealing with in a down economy. As a matter of fact, the bankruptcy laws in Wisconsin and in other jurisdictions were not necessarily designed for the high rollers, but to help everyday consumers who have gotten themselves into a bind. Lots of people find themselves out of work, and Wisconsin bank foreclosures seem to be everywhere. For many consumers, an individual bankruptcy in Wisconsin means you might be able to keep your home and car and other essentials, even in a Chapter 7 liquidation. A Wisconsin bankruptcy lawyer has the wherewithal to provide a range of options for debt relief in Wisconsin.
More sobering statistics as one year comes to a close and a new one begins. Under 2010 projections, some three million homes will be seized by banks and other lenders after foreclosure proceedings run their course, according to Business Week. Overall foreclosure court filings (that, in the end, don't always result in homeowners actually losing their property) could go as high as 4.5 million as compared to four million in 2009. December 2009 foreclosure cases filed in the America's courts increased by about 15 percent (some 350,000) from December 2008, the 10th consecutive month the total surpassed 300,000. National foreclosures in the fourth quarter of 2009 increased 18 percent over 2008's fourth quarter. And the government's loan modification program apparently has had little effect because of what's called "negative" equity: "Homeowners with negative equity, where a property is worth less than the loan, have little incentive to keep paying the mortgage and will 'strategically default,'" claims one real estate expert.
As discussed previously in this blog, Wisconsin is hardly immune from these national recessionary trends. Many well-meaning people in our state who have not botched their money management find themselves nonetheless in a real financial jam because of long-term unemployment and falling property values. While it is unlikely that good, hardworking Wisconsin homeowners will choose to default on their loans for any "strategic" reasons, the fact remains that many state residents unfortunately face the prospect of Wisconsin bank foreclosures. An individual bankruptcy in Wisconsin could, however, be one method for avoiding foreclosure. Before making any final decisions, carefully and candidly going over your assets and liabilities with a Wisconsin bankruptcy lawyer might be an appropriate way to start. As one byproduct, a consumer bankruptcy in Milwaukee or elsewhere in the state means that all foreclosure activity stops while you and your debt consolidation lawyer sort things out.
A piece in the Washington Times notes that when Congress overhauled the bankruptcy code in 2005 (revisions that changed the bankruptcy laws in Wisconsin and everywhere else), it intended to steer more consumers towards a Chapter 13 bankruptcy repayment plan. However, things didn't pan out as anticipated because the explosion of long-term unemployment forced more consumers without regular income into Chapter 7 as their only alternative. "Overburdened by huge mortgages, plunging home values, unsustainable credit card debts, tightening credit conditions and soaring joblessness, families have been carrying an 'overhang of consumer debt' for a decade or so as a result of a low savings rates and overconsumption," the Times article explains. This resulted in a "debt bubble" and soaring bankruptcy filings, according to the Times. The decrease in home values has particularly created a Catch-22 for many consumers who are now unable to even qualify for a home equity loan as a temporary bill-paying measure, assuming for the sake of discussion that would be a wise thing to do: "The ability to tap into home equity to bridge difficult times is no longer available,' [an official with the American Bankruptcy Institute] said, because home prices have plunged since the housing bubble began to deflate in 2006."
There's an old saying, you can't borrow your way to prosperity. And the collapse in real estate values, plus job layoffs and maxed-out credit cards, affects honest consumers from all brackets: working class, middle class, and upper income. Unfortunately, many consumers in this state may now have little choice but to consider an individual bankruptcy in Wisconsin. If you're facing the double whammy of the debt and housing bubbles that might be about to burst, contact a debt consolidation attorney about debt relief in Wisconsin. A trusted legal advisor is where to go for Wisconsin bankruptcy information.
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