When It Comes to Filing Bankruptcy Cheap Is Not Always Good

In this day and age of do-it-yourself businesses, big box discount stores and the growth of the Internet, most people are always looking for a deal. Today, many individuals shop prices from the security of your own home using the Internet for price comparison. People now can shop for cars, houses, vacations, airfare, and just about everything under the sun online. But is cheap always the best? In the past, Americans put a high priority on quality. This even transcended into the service industry from contractors to even law firms. Sure you can shop around and find someone who will do it cheaper, but how good of a job will the person do. This has filtered into the Bankruptcy attorney business. There are ads online where you can find a bankruptcy attorney to file Chapter 7 for $700 or $800. I’m sure they must be getting a lot of takers or they wouldn’t be advertising. What’s crazy is, would someone search online for the cheapest doctor they could find to perform a procedure on a family member? This is no different than hiring a bankruptcy attorney on a budget.

The folks that try to save a few bucks usually end up paying double in the end. Most bankruptcy attorneys offer a free initial consultation. This is a great time for someone to educate themselves and also meet the attorney to make sure that they feel comfortable with them. When filing bankruptcy, trust is very important. If someone doesn’t trust their bankruptcy attorney, they will usually hold back information that might be damaging to their case. Having an attorney that the individual filing is comfortable with goes a long way for a successful bankruptcy filing.

Being cheap when searching for a bankruptcy attorney will usually come back and bite the individual. Since the real estate bubble burst back in 2007, many Americans have been faced with foreclosure and filing bankruptcy. Because of this many attorneys have added bankruptcy to the law they practice. The bankruptcy code has become much more complex than it was in the past, making experience invaluable. A bankruptcy attorney will usually charge based on the knowledge they have of the bankruptcy law. Experience converts to knowledge and cannot be handed over to anyone for free. When considering someone’s financial future, this experience will provide quality results in the bankruptcy filing.

There is a lot of advertising that comes by e-mail and banner ads online, run by plastic surgeons offering deals for LASIK procedure for $500 an eye. When you’re talking about your vision it would be foolish to risk your eye sight to save a few bucks. This also applies to hiring a bankruptcy attorney. Considering the cost of an average attorney versus the amount of debt that’s wiped out in a typical Chapter 7 bankruptcy, it is really quite a value. For this reason, it’s foolish to scrimp unless you have nothing to lose.

Opportunities for Microfinance in Sub-Saharan Africa

A burgeoning market for micro financial institutions (MFI) is set to take hold. The Sub-Saharan African low-income market is set to explode by 25 percent in 2015. Currently 863 million people live in 47 countries. Total gross domestic product (GDP) is $1 billion. It grew to an average of 5.4 percent every year from 2009 until 2015. Today it has the potential for microfinance institutions to generate deposits of $59 billion from those earning less than $10 a day.

The challenge of delivering affordable financial services to low-income markets in Sub-Saharan Africa is an urgent one.

Extended Reach

It’s starts with local financial institutions bridging geographic, cultural gaps and administrative constraints through innovative distribution models.

While the Roland Berger Strategy Consultants study on Delivering Financial Services

in Sub-Saharan Africa, the City Town Vehicle (CTV model) already exists and is a conceptual framework, the existing infrastructure that takes into account distances, population densities and economic potential, there is a third element that can facilitate an even greater outreach.

The model combines different channels to handle a variety of products across geographical areas. It allows banks to keep their operations simple while achieving large-scale outreach to low-income clients. Cooperation among financial service providers, mobile network operators and retailers is the key. By building on the existing framework between various players helps keep costs down while increasing convenience.

Beyond Mobile

In the Think:act Study, the concept of roving agents furnished with Point of Sale (POS) devices was research. The agent would be sent out into locations where villagers rarely leave their communities, but still operate small businesses and can benefit from banking transactions. The agents would visit poorer neighborhoods and remote markets, distant towns (to increase mobilization of deposits) and villages of 2,000 and less residence.

Traveling agents would handle client registration and activation of accounts, as well as being able to offer the full set of transaction services, and support loan application, pay-out and collection of repayments and interest. Roving agents travel back and forth between the (various) village(s) that they serve and the town where they rebalance accounts at the super agent or mini branch when cash limits are reached.

Underserved Markets

The study found that MFIs in Sub-Saharan Africa, have an average client base of 31,000 people. It cannot keep pace with the fast growing low-income adult population. So far they only been able to provide financial services to a select few in the local townships.

Many MFIs shun rural areas and agriculture which is still the main focus of most Africans’ economic life. They seem to prefer to serve small businesses in easier accessible urban and peri-urban settings with higher average loan amounts.

In Sub-Saharan Africa, about 80 percent of the 498 million adults still do not have access to banking services, which is the highest rate of financial exclusion in the world, according to the study. Penetration of savings accounts in Africa is less than one-third of the average level of other developing markets, with 202 commercial bank accounts per 1,000 adults, compared to 661 in other developing countries.

Things To Consider Before Consulting A Bankruptcy Attorney

You’ve done everything in your power to resolve your financial difficulties, but you realize that your best just doesn’t seem enough. This is when you can consider filing bankruptcy. Have you ever wondered if you need assistance doing this? Though not everyone require help in filing bankruptcy, many actually do. Many times an individual relies completely on a bankruptcy lawyer for the filing of the papers as well as the proceedings. Even if you are sure that you cannot go forward without the help of a lawyer, there are certain things that one needs to consider before you actually consult one. In order for the first meeting and consultation to be fruitful the following should be considered and fulfilled prior to consultation.

Keep the papers in place

Before you go forward with the consultation make sure to collect all the original papers such as the documentation of loans and financing. Lawyers are really helpful when it comes to helping you out with legal matters however you need to give them all the information needed to successfully help them study your situation. Some individuals will benefit through this action and for others the situation worsens. Whatever the outcome of being transparent with your attorney is, he will only be able to help if he knows what he is dealing with.

Photocopies

Just so that you have proof of your attempts, it is advisable to make copies of receipts and documents indicating that you have made moves to resolve your financial difficulties.An examples of this would be receipts of payments made to try to cut debts. This kind of documentation will surely help the lawyer proceed with your case. This documentation will help the attorney assess the situation too.

List your concerns

It makes the first consultation easier if you have a list prepared indicating the questions you have in mind. Since you are new to the situation, it is a normal thing to be full of concerns and doubts. A list can help you clarify doubts and make you comfortable with the proceedings. Maintaining a booklet for this purpose will help you jot down anything that crosses your mind.

It is in fact the most difficult situation for a person to be going through bankruptcy. Hiring a lawyer to handle the situation will make things a little easier for you. However, keeping these points in mind and following them will help you with your first consultation and you would benefit from the consultation. It is never an easy decision to file for bankruptcy. With the most difficult decision taken, the only other thing to take care of is handling the case. A good bankruptcy attorney will make sure that you would be able to start on a clean slate.

Bankruptcy and Your Vehicle

The bill collectors are calling you and everyone you know, your wages are about to be garnished and you can barely pay the necessities. You know you need to file bankruptcy. So what is stopping you, the fear of losing your car, truck, or motorcycle?

In most cases when you file bankruptcy you can keep your vehicle. Of course, it is a little more complicated than just file bankruptcy don’t worry about your car. This article will explore several scenarios I have dealt with in the past dealing with bankruptcies and client’s vehicles. Motorcycles come with a caveat, here it is… Motorcycles are slightly different from other vehicles in that they can been classified as non necessity luxury items so contact your attorney to see what your specific options are regarding motorcycles.

Scenarios in a Chapter 7 Fresh Start Bankruptcy.

Scenario 1. You owe nothing on the car and it is not worth that much. You do not make enough money to cover even your basic needs, you have a car and you do not want to lose it. Chances are if you have a car in this situation you own it outright. Whether you can keep it or not will depend on the value of the car. In Washington, for example, the automobile exemption for an individual is $3450.00. Washington also allows a wildcard exemption of $3000.00. If your car is worth $4500.00 in its current condition, an individual could use the full motor vehicle exemption and then use $1050 of the wildcard. That will fully protect your car and still save $1950.00 of your wildcard. Your car is safe.

Scenario 2. You owe nothing on the car but it is worth more than the exemption value. This is the most complicated scenario in a chapter 7 bankruptcy and may be better dealt with in a chapter 13. Nevertheless, there are options in a chapter 7. Let’s say the car is worth $10,000.00. As discussed above, you can use the current vehicle exemption of $3450.00. You can then add to that the wild card exemption of $3000.00. That protects $6450.00 of value in the vehicle. meaning that you have $3550.00 unprotected. Now we have a couple of options.

You could:
1) Let the trustee take and sell the vehicle and use the proceeds to pay off some of your creditors. If you do this, the trustee will cut you a check for $6450.00 and use the $3450 that is unprotected to pay some of your creditors. You could then use this money to help get a new car or to buy a used car outright.
2) Try to work out a deal with the trustee to repay the unexempt equity. Trustees are usually willing to work out a reasonable payment plan to allow you to keep something like a vehicle. Common terms might be to pay back the equity in six equal installments, or to make a down payment with a monthly payment that ends in a larger payment when you get your tax refund. You need to be careful with this useful arraignment, if you default on your payments your discharge could be denied or revoked.
3) Try to get a new loan on the car after the bankruptcy is finished which would allow you to pay the equity to the trustee. You would then have a car payment to pay the newly incurred loan.

Scenario 3. You owe less on the car than what the car is worth. If you are looking to file a chapter 7 to obtain a fresh start and avoid making a chapter 13 trustee payment, you should be able to protect that car. Say the car is valued at $15000.00 and you still owe $12000.00. In this case you have $3000.00 in equity. Because the automobile exemption is worth more than the equity you have in the vehicle, your car will be protected. You will need to speak with your attorney about what to do during and after the case, but you will need to maintain your loan payment if you wish to keep the vehicle.

Scenario 4. You owe more on the car than it is worth. In this scenario you might owe, for example, $15000.00 on a car that is only worth $7000.00. You have several options under this scenario.

You could:
1) decide to let go of the car. Why pay more than double the value of anything? You could surrender the vehicle and then look to purchase a vehicle with better terms after the discharge;
2) You could continue to pay on the vehicle at the terms provided in the loan agreement;
3) We could seek a redemption loan whereby you get a new loan that is only up to the value of the car in its current condition. In this case you need to qualify for the new loan and there may be additional attorney’s fees but it could potentially save you a lot of money and keep you in a car that you love.

Scenario 5. Bonus Scenario! You have unexempt equity in your vehicle but you also have tax liens which attach to personal property. This one is a little tricky, but if you have no other equity in any other property and the amount of the tax lien is greater than the unexempt equity in your vehicle, the trustee is not likely to bother with you or your vehicle. The down side to this is that if they were to take and sell the car for the unexempt equity, they would then use that money to pay off or to pay down your tax lien. If the trustee leaves you and your vehicle alone, you are still going to have to find a way to deal with those taxes once your bankruptcy is done.

Scenarios in a Chapter 13 repayment plan bankruptcy:

Scenario 1. You owe nothing on your car and it is worth less than the exemptible amounts. Under this scenario, your vehicle would have no impact on your chapter 13 plan payment.

Scenario 2. You owe nothing on your car but it is worth more than the exemptible amounts. Under this scenario, we have to offer the unexempt value to the creditors in the form of your trustee payment. While this goes beyond the scope of this article, we can pay the unexempt value by way of the trustee payment over a period of time lasting as long as 60 months. This is a valuable tool if you have a car that is worth a lot of money and you cannot bear to part with it.

Scenario 3. You owe money on the car and you want to keep it. This scenario gets complicated depending on whether the loan on your car was taken out at the time that you bought the car. It also matters as to how long ago you bought the car. If you bought the car more than 910 days ago, we can cram down what you pay on the car based on its current value. So say that you owe $15000.00 on the car but it is only worth $7000.00, we can propose a plan that only pays that creditor back $7000.00 as a secured claim. We can also lower the interest payment on the car depending on the rate that the loan is for and depending on the jurisdiction. If you bought the car less than 910 days ago, we may still be able to lower the interest rate that you pay on the car, but the full dollar amount of the outstanding loan would have to be paid back as a secured creditor.

Scenario 4. You owe money on the car and you just do not want it any more. In this scenario a chapter 13 can also be a good option depending on what the rest of your financial situation looks like. We can propose a plan that surrenders the collateral. The lien holder will come and get the car. They then have to sell it and credit your account for the amount of the sale. In the chapter 13 they are then able to file an unsecured claim for the remaining balance. The benefit to you though is that you will end up paying less than you owed (possibly zero) and paying no further interest on the loan.

Conclusion: As you can see, there is no simple answer to what happens to a car in a bankruptcy. The good news though is that there are many options that allow you to keep your vehicle and still other options that will allow you to escape from a bad deal. If you find yourself in financial difficulty and the thought of losing your only car is stopping you from filing, call your local bankruptcy attorney to discuss which option might be best for you.

Cram Down a Car Loan With Bankruptcy

Many individuals who are considering filing for bankruptcy are interested in what is known as a car loan cram down. What is a car loan cram down, how does it work, and when may it be utilized for you? Here, learn all about this interesting mechanism of bankruptcy proceedings.

A car loan cram down is utilized for individuals who currently have a car loan in which they owe more on the loan than the car is currently valued at. In other words, your car is worth less than your remaining debt on it, which is certainly not a good position for you to be in.

This happens to many people, as vehicles can depreciate quickly, and this is particularly the case when loans were made for long periods, and little or no money was put down, meaning the loan carried the full sale price of the car when you purchased it.

With an auto loan cram down, you can then reduce the remaining principle balance of your debt to the actual value of the car. In certain instances, this can potentially save you thousands of dollars. Since you owe more than the car is worth, only the actual value of the vehicle is secured by your lender. This means that, they would only receive the actual value if they resold the car, and therefore, the remainder above that value represents unsecured debt.

It’s important to note that the option to cram down your car is not available with all types of bankruptcy cases. Specifically, it is available for those filing chapter 13 bankruptcy. After you cram down your car, the newly reduced and remaining balance will be paid according to the payment plans you establish during your bankruptcy case.

It’s also important to note that cramming down your car has another benefit to you as well. It can be utilized at the same time to reduce your auto loan interest rate. Now, you owe less on the car, you don’t have more debt than the car is valued at, and the remaining balance which you have to pay will be paid at a lower interest rate.

As always, be sure to consult with an experienced legal professional who will be able to guide you through this process. To maximize the benefits of bankruptcy and successfully utilize mechanisms such as car loan cram downs, you need the experienced hands of an attorney who is intimately familiar with the bankruptcy process and all of the many regulations in place.