Thus far, there has been an implication that lenders will work harder with borrowers, federal tax breaks, and a reduction of federal interest rates.  These are all helpful, but there are still many individuals that need some extra assistance immediately.

Let’s all hope that this coming year brings a bailout and a lot more transperancy.

 In the meantime, it is always helpful to remember that you should be able to talk to your lender, request the modification and review your other options.  The attorneys of Smith & Garg, PC are always willing to sit down and explain the current options available to you.

 It is time for a fresh start, new beginnings, changes - or any other description you desire.  It is also the time to start paying off those fun little credit card charges incurred over the holiday season.  Of course we all resolve to pay off debts or not spend so much during Christmas, but for those of us who have ignored our little “recession” and continued to spend, here are a few post-holiday credit tips:

Step No. 1: Make a list of what you owe on each credit card and arrange all of your debts in order, starting with the largest balance first. Then prioritize your repayments (ie paying down the highest interest rate first).

Step No. 2: Eliminate credit cards and don’t roll over balances. Once paid off, notify the company that you want to close the account.

Step No. 3: Track the money that’s coming in and going out. Use a debit card instead of your credit card. Download your bank transactions into a computer program for easy categorizing.

Step No. 4: Don’t go back to spending on the credit cards that are already paid down! Many people pay down credit cards only to charge them up again.

Step No. 5: Some people, the problem of overspending is a psychological one. Spending can become a habit that’s as difficult to kick as alcohol, drugs or gambling. Sometimes, it’s due to circumstances they truly could not avoid: medical bills or divorce or loss of a job.

Remember, there are a number of organizations that provide help in creating a credit management plan.  Be sure to research these organizations before paying.  Often the Better Business Bureau and the Federal Trade Commission will have listings on their websites of reputable comanies.

 Happy New Year and good luck with your resolutions!

 In our profession, we generally deal in terms of minimizing conflict or even escalating it if matters require it.  It’s a nice contrast when you leave the office and people simply smile and say “Merry Christmas” or “Happy Holidays” - even if they don’t really mean it.

 So to those who take the time to read - Merry Christmas!

 The most important thing to let you know is that it is illegal for them to threaten you over the phone in order to scare you into paying.  If you receive these types of phone calls you should immediately demand that they stop calling you (in writing and over the phone) and report the threats to the appropriate consumer protection agency.

After getting past the threats, you should know how collection proceedings work.  First, you have the debt that you have incurred.  If you have not paid, you will often receive a letter and then the phone calls to collect from you.  In either case, further collection proceedings require the filing of lawsuit against you.  It is only after the lawsuit has been filed, tried (or if you fail to answer a default judgment is entered) that a creditor is able to either:

• 1. place a lien on property you own
• 2. seek a wage garnishment
• 3. levy accounts
• 4. appoint a receiver for a business (in cases)

 Each of these steps require that the creditor have a valid judgment before any of these steps can be taken.  In each of these scenerios you should receive some form of notice - not the Sheriff just magically appearing to take your stuff.

The notices may only be letters sent to your last known address from another attorney or the court, or sent directly to your employer.  So if you know that a creditor is attempting to collect a debt, watch the mail - don’t just throw it in the trash.  Often creditors are willing to work out something even after a judgment has been entered.

1.  Most federal and state taxes

2.  Debt incurred based on fraud (ie you wrote untrue statements on a loan or credit card application regarding your income or ability to repay)

3.  Debts not listed on your Bankruptcy Schedules, but you KNEW were there

4.  Debts incurred due to fraud, embezzlement, 0r breach of some fiduciary duty

5.  Judgments based on willfull/malicious conduct that causes personal injury; death or personal injury claims due to a DUI

6.  Domestic support obligations (child support or alimony payments)

7.  Unless there are extreme circumstances - student loans!

There are other debts that are also not dischargeable, but those usually aren’t the concerns of individuals (Federal Reserve debts; corporate tax penalties; profit-sharing contributions, etc).  So, as the goal is to get rid of debt, look at the debts first.  You may have to be more creative.

 What amazes me the most are the shear number of email forwards that you receive the closer to the election.  I have received emails regarding prayer requests for each of the candidates to win.  I have received emails with touching photos of Sen. Obama; and lists of how “unamerican” he is.  I have received email regarding Sen. McCain plans to “imitate Pres. Bush” or how his time as a prisoner of war is reason enough to elect him.

 Under the flood of all the email propoganda from both sides, one thing that I will say, the present countdown is one of the most entertaining I have ever seen.   I want to thank the bloggers, email forwarders, crazy left-wing liberals and insane right-wing fanatics for making this the most extreme election I have ever participated in.  And most of all, I would like to thank Saturday Night Live - you have outdone yourself this season!

Recent case in point - Quarantine.  I saw the previews and if it had not been for a friend who LOVES scary movies, I could happily have waited until it showed upon HBO, Showtime, Cinemax, etc. before seeing it.  But alas, there I was in the theater watchign a scary movie.  If you liked the Blair Witch/Documentary style, this movie may appeal to you.  Also, some 28 Days Later/Zombie movie fans may also find this intriguing.

Unfortunately, once I got over the self-inflicted fear fo things jumping out of dark corners or characters making the decisions to “go back” and help, I actually became annoyed at the movie.  Heavy breathing, constant screaming, surpisingly little backplot - I was dissapointed.

In fact, the next afternoon, I saw Monster House on cable.  This kids movie - about some children who beleive a house is eating people and toys because it is imbued with the evil spirit of a cranky neighbor - actually had a better plot line than Quarantine.  It was better explained, and in my opinion more thought out than the overdone rabies/rage theme that we have seen for quite a while.

As sad as it sounds, teh kids win…

 The SOL generally starts either when the claim arises or when you “discover” that you have a claim.  For California there are a number of standard SOL’s:

• Breach of Written Contract - 4 years
• Breach of Oral Contract - 2 years
• Fraud - 3 years
• Personal Injury - 2 years

This means that for these types of cases, you have a limited time in which to get your matter before the court.  There are some exceptions to this rule and for different matters different SOL’s apply.  SO when you come to a lawyer for a matter, it is always important to discuss the dates that things happened as well as when you learned about them.. we would hate for you to end up SOL.

Sen. Obama took the time to explain how small and large businesses require loans in order to regularly meet payroll and that this bill provides the Secretary of the Treasury with the power to address individual loans.  Sen. McCain also brought up the point that he would intitiate some plan by which the government would buy up all the “bad loans” in order to keep people in their homes.

I will be honest here and let you know upfront that at the moment I am a Sen. Obama supporter.  However, if Sen. McCain has an effective plan that incorporates the purchase and required renegotiation of loans (even loans that are current), then put his options on the table too.  As the market currently stands, and with the continuing downfall of home prices, it is imperative that action should be taken on behalf of individual borrowers as well. 

Although I am not an economist, I do have a number of clients who are attempting to renegotiate their loans, refinance, or have been forced to simply walk away from their homes.  The opportunity to demand that a lender cooperate (earlier than receipt of a Notice of Default) will be invaluable.  It’s a solution that must be pushed forward!

 Well, sad to say, a similar situation has occured in bankruptcy court.  A St. Louis resident hired a contractor to do some work for him.  After paying over $18,000, the contractor never started any work.  Eventually, the contractor was arrested and ordered to pay restitution to the St. Louis resident.  How does this interact with bankruptcy law, you may ask?

 Well, the contractor filed Chapter 7 shortly before his arrest and filed an action in bankruptcy court alleging that the man he defrauded was in violation of the Bankruptcy Automatic Stay that prevents collection of any debt upon the filing of a bankruptcy.  The bankruptcy court actully found in favor of the contractor and ordered the individual to return any amounts he had collected through the restitution proceedings!

The matter was appealed and the final decision is still pending.  In either case, it is a rather twisted situation when Bankruptcy relief denies “justice.”