Posted by Sheila Diamond on Mon, Jul 27, 2009 @ 05:48 PM
Have you ever wondered why doctors and lawyers ‘practice' their profession? I have. Today you have to be lucky to find a doctor that focuses on ‘healing' and an attorney that focuses on ‘selfless problem solving'. It has been my experience that the word ‘practice' gives professionals the freedom to make choices that may not best serve our needs. It's important to sift through the rhetoric and do your homework.
I 'm Sidney Diamond wife and I can often be his worst critic. He leaves his clothes everywhere, almost never closes a cabinet door and is constantly misplacing his keys. He's also brilliant and has more integrity than anyone I know.
Case in Point: I sat in on a free initial consultation with a potential client this week. The gentleman was devastated about his state of affairs and at his wits end. He started his business over 10 years ago, incorporated his business and now due to the economy his industry came to a screeching halt. I was impressed by how prepared he was for this meeting. He wanted to know if he should consider filing a business Chapter 7 or a Small Business Chapter 13. He had corporation papers, his lease, credit card statements, tax information; he knew the answers to all the questions asked and had all the documents that Sidney asked for. He had several years left on his lease (which he did not personally guarantee), credit card debt and bank loans (which he did not guarantee). Basically his business was in debt for almost $100,000 and the business had no assets to protect.
Sidney recommended closing the business and walking away. Bankruptcy was not recommended in his situation. It was amazing to see the relief on his face. His reality is still scary, he worries how he'll continue to feed his family, pay his mortgage and find employment. Lucky for him he found sound legal advice.
Posted by Sidney Diamond on Tue, Apr 28, 2009 @ 02:10 PM
There are a number of things a person should not do when considering bankruptcy or when bankruptcy is a solution but one you wish to avoid. The bill collectors are hounding you with a barrage of telephone calls, in many cases they are breaking the law by calling your relatives, your employer, calling you very early in the morning, after 9pm or when you are at work and/or threatening to do all kinds of awful things if you do not pay up. It is understandable that all you can think about is getting them off of your back, at least for a little while. So what do you do? You promise to make them a payment(s) in the future; knowing there is no way you'll have the money to pay them, short of a miracle. In some cases people go so far as to sign a new agreement with their creditor.
You then seek the protection of the Bankruptcy Court and the creditor screams foul and seeks to have the debt you owe not be forgiven. Why? You made a promise to pay and did not keep your promise and because you made the promise the creditor did not take any action to collect on the debt. If a creditor can show you're promising to pay in the future delayed action to collect the money it was owed, you may well be denied forgiveness of that debt.
Do not make a creditor a promise or enter into an agreement with a creditor if there is any chance that you can not make the payments. The best thing to do is make no promises of any kind. If you are being hounded by creditors use the rights given to you under the Fair Debt Collection Practices Act,( which I have written about before) and write your creditors letters telling them to stop calling you, etc. Remember empty promises can hurt.
Posted by Sidney Diamond on Wed, Mar 04, 2009 @ 09:03 PM
My general rule of thumb is a person will be able to obtain a credit card on reasonable terms after two (2) years of your bankruptcy discharge. Now you can acquire an FHA loan to buy a house after two (2) years from your bankruptcy discharge. Take time in choosing your new credit card and mortgage because terms and conditions vary from company to company. FICO scores are important to some while others value how long it's been since you were past due on any obligation.
Here are a few simple rules to follow to restore your credit:
- 1. Obtain a copy of your credit report within 90 days after your bankruptcy has been discharged. Make sure that all discharged debts have been removed from your credit report. If you don't want to do the required leg work - contact your bankruptcy attorney.
- 2. Be sure to keep your current debts (obligations) current and paid on time.
- 3. Start a savings program so that you can have a down payment available when you are ready to purchase a house.
- 4. New credit card charges should be paid in full each month.
These simple rules will allow you to improve your FICO score, prove you are responsible in paying your obligations, as well as demonstrate you are fiscally responsible by keeping your obligations low and finally have the ability to make a reasonable down payment on a house.
So, you can have credit cards and qualify for a mortgage to buy a house after discharged from your BANKRUPTCY.