Written by San Francisco Bankruptcy Lawyer, Jeena Cho

In this economy, when couples are contemplating divorces, they are not fighting over who’s going to get the silverware, but who is going to pay the marital debt. Frequently, there are no assets to distribute in divorce – only debt. Divorces are of course expensive. It’s costly not just in terms of having to pay for two attorneys, but the emotional toll as well. Just this week, I met with a client who had racked up over $30,000 in attorney fees all in an effort to take on as little of the marital debt as possible. Now she is contemplating bankruptcy to get rid of the attorney fees.

So, is it smart to contemplate bankruptcy before the divorce? If you are on amicable terms with your soon-to-be ex spouse and the only issue is how the debt will be divided, it may make a Continue Reading »

By: Jeena Cho, Bankruptcy Lawyer

When you hire a bankruptcy lawyer, you are not just hiring someone to fill out the bankruptcy forms. If you wanted someone to simply fill out the forms, you can hire a document preparer for a couple hundred dollars. What you are paying for is the attorney’s knowledge about the bankruptcy law.

So, what goes into planning for a bankruptcy? Why hire an attorney for your bankruptcy?

Here are few items to consider.

Timing. As with most things in life, timing is everything. Many potential problems with bankruptcy can be avoided by properly timing the bankruptcy. Just as an example, I review my client’s most recent credit card statements to see if there are any red flag items. If there is, I may recommend waiting.
Exemption. Exemption govern the property you can keep through bankruptcy. If you have “non-exempt” property, we may consider Chapter 13 to keep those Continue Reading »

Written by San Francisco Bankruptcy Lawyer, Jeena Cho

I came across an excellent article by a fellow Charleston Bankruptcy Lawyer. Russell DeMott, which addresses the impact of bankruptcy on credit report. If you are concerned about impact of bankruptcy on your credit report, consider the following:

Your Credit Rating is Already Screwed Up!

My answer to this question is usually the same: “you already have bad credit.”  The vast majority of clients who see me are delinquent on their debts.  This, of course, is why they came to me in the first place.  They have 30 day lates, 60s, 90s, lawsuits, judgments, and everything in between.

Having debts problems is like a tumor, though.  You get rid of it two different ways: (1) you pay off the debt–and that’s not an option much of the time, or (2) you file bankruptcy and discharge it.  If you do nothing, the tumor just grows and grows.  Continue Reading »

Written by San Francisco Bankruptcy Lawyer, Jeena Cho

There may be some relief coming to those with overwhelming private student loan. Rep. Steve Cohen, D-Tenn., recently held a hearing on legislation (H.R. 5043) he authored that would allow for the discharge of privately issued student loans. He said interest rates and fees on private student loans can be 15% or more. Such interest rate can exceed that of credit cards. Many student loan companies prey on students too young to understand the consequences of taking out huge student loans. They are often misled to believe it would not be a problem to repay such loans because everyone with a degree can make 6 figure income.

This would be welcomed news should it pass (but I’m not getting my hopes up yet).

What really happens to you when you file for bankruptcy? What do you have to do? How do you survive afterward?

Four real people, Michael, Robert, Robin and Andrew, shared their experiences going through bankruptcy. (Only Robert allowed us to use his real name.)

Robert Nickell, a pharmacist and chairman of the Nickell Group, filed for bankruptcy in 1999, when he was 39. He lost his business, a pharmacy in Manhattan Beach, Calif., after accumulating more than $600,000 in debt then going through a protracted divorce.

Robin, 31, thought she was covered by health insurance when she spent a week in the hospital after a car accident. She was mistaken. She was already in debt from starting a freelance copy-editing business; with the hospital bill, her debts topped $65,000. Then she lost her job. That was the last straw.

Michael practiced medicine in Oregon for 45 years. He filed for bankruptcy at age 72, Continue Reading »

Written by San Francisco Bankruptcy Lawyer, Jeena Cho

Can bankruptcy help with student loans? – This is a frequent question I get and a common situation. Most unsecured debts such as credit cards are dischargeable through bankruptcy. However, student loans, both federal and private have an immunity card. In general, student loans will not be discharged after bankruptcy. So, what should you do if you have too much student loans and do not have any realistic hope of ever repaying? There are a few options to consider.

Contact the lender. Most student loan programs have either deferment or forbearance programs where you can temporarily suspend repayment of your debt. In my experience, private student loans either do not have such programs or makes it almost impossible for students to qualify for such programs. It’s important you reach out to the lender as soon as possible. Many of them will refuse to work with Continue Reading »

By: Jeena Cho

Living in the Bay Area, I have many clients who are business owners. Oftentimes, these small businesses are heavily in debt and have little or no hope of survival unless it can shed its debts. What most small business owners do not realize is that bankruptcy may actually be a beginning rather then an end.

Let’s take two simple examples.

Example #1. You operate a business as a sole proprietorship. There is $20,000 of business assets and $150,000 of debts related to the business. In addition, the you have $50,000 of personal credit card debt.

Assuming the owner does not have significant amount of personal assets or other non-exempt assets, s/he can qualify for Chapter 7 bankruptcy regardless of his or her income. The business owner would qualify for Chapter 7 as a non-consumer case. The rule is that if more than 51% of your total Continue Reading »

By: Jeena Cho

As a society, there are two things we don’t talk about. Death & Debt. Frequently, when people are experiencing financial distress, they go into denial mode. Instead of assessing their situation and tacking the problem, they deny thinking something will change. Of course, debt problems do not get better without proactive action. It gets worse. Interest rates continue to rise, you borrow from Peter to pay Paul.

If you are experiencing financial trouble, you should seek help. Go see a financial advisor, reach out and ask a friend or a family member. You will soon find that you are not alone in your problems.

For those of you that do not see any hope of being able to reduce your debt, we are offering a free seminar. If you do not want to attend in person, you can attend on the Web. It’s totally confidential. We’ll discuss the Continue Reading »

By Jeff Curl

Every bankruptcy case involves the 341 meeting of creditors.  This is where the trustee swears a debtor under oath and examines him or her about assets and representations made in the bankruptcy petition. Recently my client and I were sitting next to each other waiting for the trustee to call the next group of five debtors to be examined under oath at the 341 meeting of creditors.  An attorney walked in and asked the trustee if he could jump the line and have his case heard first because he had a hearing he needed to get to.  The trustee being her usual accommodating self said, “Sure.  What’s your client’s name?”  The attorney furled his brow and responded, “I don’t know.”  He then started rummaging through his papers.

My client leaned over to me and whispered “I’m glad he’s not my attorney.  I would Continue Reading »

By: Jeena Cho

One of the most frequent questions people ask me at the consultation is “do you think I should file for bankruptcy?” Of course, being a lawyer, I can’t ever give a simple “yes” or “no” answer (this is taught first day in law school). My answer is usually “if you don’t file for bankruptcy, what other options are there?” I think the question isn’t “should I file” but really “can I afford not to?”

Just last week, I met with a client who had 4 lawsuits against her. She came in for debt settlement advice. She was adamant about not filing for bankruptcy. When I asked her how much money she had in the bank account, she answered “few hundred dollars.” She also had no other source of funds to tap into. From where I was sitting, she was simply delaying the inevitable and avoiding Continue Reading »