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Refund Anticipation LoansThese loans are some of the highest cost loans that exist. A borrower pays anywhere from 40% to 700% depending on the lender and loan amounts. While this seems like a great option when you are on a tight budget, it may be just the opposite. You are due $4,500 for tax refund. You want your money 4 weeks earlier that it would normally be received so you obtain a refund anticipation loan. You have just now handed over $1500 so that you can have $3,000 only a few weeks earlier! Doesn’t seem worth it to me at all.Luckily for those tempted by this bad financial option, the refund anticipation loans may no longer offered as there will be nobody to back the loans. The FDIC just ordered the underwriters who back these loans to stop backing these controversial loans. The FDIC’s argument is that the loans themselves are “unsafe and unsound.” The loans are now even more so unsafe and unsound because the IRS no longer provides bank it debt indicator. This debt indicator was a tool used by the loan providers used to determine whether a taxpayer, soon to be borrower, had outstanding tax liabilities that could be garnished from a tax refund which would result in the loan provider not being paid back the loan from the expected tax refund if it is not received.People who are in support of refund anticipation loans state that the one-time fees help deliver money quicker to those people who always live paycheck to paycheck. The refund anticipation loan supports argue that if these refund anticipation loans are not available to these people that live paycheck to paycheck that they would simply just seek the money from other sources with possibly even higher interest rates and fees.Refund anticipation loans however should become less necessary as IRS has started offering direct deposit options for tax refunds often within 7 to 14 days. The IRS’s program offering depositing refunds onto prepaid debit cards should also decrease consumers needs to refund anticipation loans. The ultimate decision as to whether you really need a refund anticipation loan may depend on your specific situation but it should be cautioned that you will have a significantly larger sum of money to help with your situation if you can simply wait a few more weeks. Couldn’t you wait a few more weeks in order to receive an extra $1,000+?
I do not have money so how do you expect me to pay you?The easy answer is that you may not be able to afford not to pay an attorney to file a bankruptcy for you. While it often seems odd to perspective clients that there are fees involved, it honestly may be cheaper than the alternatives. Sounds crazy right? Not so. Here are scenarios where not filing a bankruptcy will cost you more money than filing bankruptcy:
- You took out a payday loan for $500. Due to the high interest on these loans, you know owe them $250 bi-weekly for four pay periods for a total of $1000. If you provided your bank account information to them when the loan was received or if you provided postdated checks at the time the loan was received, they are going to take their money regardless of whether you go in to make the scheduled payments. In this scenario, over the next two months you will be paying them $1000. In some cases, this is likely enough to pay all or most of the fees involved in a bankruptcy.
- You have credit cards or medical bills piling up and you are struggling to stay current even on the minimum monthly payments for all of them. You are slowly getting farther and farther behind and the creditors are being to call inquiring about payments. You keep promising payments but are unable to follow through with making them. Eventually the debts are sent to collections and the phone begins to ring even more from collection agencies attempting to collect payment. If no payments are received or the requested amounts are not received they likely will file a lawsuit against you in state court. You will receive a summons to appear in court. If you appear you may be able to ask for a continuance to buy you some time and the next court day whether you appear you not you will likely receive a judgment. Once the creditor has obtained a judgment they can appear to the court for a garnishment or a bank levy. If they garnish your check they can take up to 25% of your paycheck every pay period until the debt is paid off while occasionally having to renew the garnishment and adding their attorneys fees to your balance owed. If the creditor puts a levy on your bank account there will be a returned date listed and on that return date any funds in the account will be sent to the creditor.
As listed above, having unpaid delinquent debt may actually cost you more money than the fees involved in a bankruptcy. If you are struggling to stay afloat contact a bankruptcy attorney today to discuss your options.
Saturday, Sept. 7, I'll be playing Moog guitar with Baghouse at Head On The Door here in Montgomery, AL. All you folks who dig on some freaked-out, highly-focused instrumental space rock drone noise should come on out! 10pm. Free. We'll be playing all night.
https://www.facebook.com/events/157275931142135/?context=create
Many who claim to have no assets file Chapter 7 bankruptcy. This is sometimes referred to as a Chapter 7 no-asset bankruptcy. In many cases, the process goes by quickly since the trustee won’t have any property or assets to satisfy creditors with. Many consumers don’t realize that a large number of Chapter 7 cases [...]
Bankruptcy laws provide for you to exempt property from the bankruptcy process that is necessary for you to get a fresh start. In handling your bankruptcy case, we will need to take into consideration how long you have lived in Arizona to effectively plan your property exemptions. Some states will allow you to [...]
Bankruptcy laws provide for you to exempt property from the bankruptcy process that is necessary for you to get a fresh start. In handling your bankruptcy case, we will need to take into consideration how long you have lived in Arizona to effectively plan your property exemptions. Some states will allow you to […]The post Planning Your Exemptions In Bankruptcy appeared first on Tucson Bankruptcy Attorneys Trezza & Associates.
Bringing you the most up-to-date news, tips and blogs throughout the web. Here’s your Bankruptcy Update for August 27, 2013 Bankruptcy Costs Weighing on AMR’s Profits Irish Bank Resolution Corp. Files for Bankruptcy in U.S. Buffalo Lake’s ethanol plant is sold in bankruptcy
As an individual, being responsible for business debt in bankruptcy likely depends on the structure of your business. In some cases it may depend on how it was developed or formed. Many who seek to file for protection may operate a business as a sole proprietor, partnership, corporation or limited liability company (LLC). If you [...]
The New York Times recently published a somewhat discouraging article about the difficulty older workers are having finding jobs following the “Great Recession.” According to the article, it takes workers over 50 almost a full year to find a new job, compared to about 20 weeks for 16 to 24 year olds.Further, less than half of laid off workers between the ages of 55 and 64 are finding jobs at all, and less than 25% of workers over the age of 65 are finding work.Those workers who do find jobs often do so for less money and a recent Supreme Court decision [The Supreme Court ruled in 2009 that the Title VII framework does not carry over to age-bias lawsuits. This case was Gross v. FBL Financial Services, Inc. - you can read more about it here.] which makes it more difficult for an older plaintiff to recover damages for age discrimination.You may be asking “what do these statistics have to do with filing bankruptcy?”I think that this bleak job picture for job seekers over the age of 50 should encourage those within that age group who are in debt to be more open to the possibility of filing bankruptcy.If you have worked your entire life, paying your bills without asking for help, the idea of filing bankruptcy may seem foreign and very distasteful. This viewpoint is legitimate and understandable.However, the reality of today’s job market suggests that if you are 50+ and laid off, you will find it more difficult to find a good paying job quickly. And before you run through your savings or raid your 401(k), you should speak to a bankruptcy lawyer to at least consider a bankruptcy option.I have met with far too many clients who came to me after liquidating their savings and retirement plans. The bankruptcy law allows you to protect some or all of your savings and all of your retirement money in most cases.So, would you rather find yourself post bankruptcy but debt free with money in a savings account and your retirement plan intact, or flat broke with nothing in savings, nothing in your retirement plan, tax debts arising from the early liquidation of your retirement plan, and daily harassment from debt collectors.If I can help you learn more about your bankruptcy and non-bankruptcy options, please contact me using this form or call me at 770-393-4985.The post Unemployed Workers Over Age 50 Should Give Bankruptcy a Look appeared first on theBKBlog.
This question may not initially be on the mind of a prospective client when they come into your office, but the situation does come up from time to time when it is in the best interest of the client who originally started their bankruptcy as a Chapter 13 to convert that case to a Chapter […]
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