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Wake Up and Smell the Insolvency!

By Joseph McDaniel, Esq.

Procrastination can sometimes be a good thing.  So they say.

There are time management classes and books which suggest that by procrastinating unimportant projects, you will automatically prioritize important things. Or so they say.

But I get to see many, many cases of malignant procrastination.

For instance, I get to see folks who waited until they had spent all of their retirement savings, and their resources of every kind, in a futile and doomed attempt to stay current on their minimum payments to their credit cards.  Or in a futile and doomed attempt to hold onto an underwater house, after one of the spouses had lost a job and they couldn't possibly afford the $3,000 per month payment on all three mortgages.

Wake up and smell the insolvency, guys!

There are some things that nobody who partakes of a non-damaged brain would do as a matter of preference.

One is sky-diving without a parachute; one is experiencing chemotherapy if you don't have cancer; and one is filing bankruptcy if you don't need to file a bankruptcy (I routinely turn potential clients away if they have too little debt to make a bankruptcy cost-effective and useful to them).

But when I'm contacted by somebody who has burned through every kind of saving, borrowed from every relative who's still speaking to them, and who ignored the lawsuit so they're being garnished, it makes me sad.

The most insulting part of the BARF Act is that it presumes that Americans abuse bankruptcy.

I have about thirty years of experience in the bankruptcy trenches; I've talked to business owners, wage earners, and unemployed for thirty years about debt, and ways to cope with debt.

I can count on the fingers of one hand my potential clients who had bad intentions concerning bankruptcy.

And on the other hand, I know that one in a thousand potential debtors might have larceny in their hearts; but I also know from working with Bankruptcy Judges for three years that they have plenty of savvy and plenty of power to deal with any possible sort of bankruptcy abuse.

Which tells me that the BARF Act was a solution in search of a non-existent problem.

I'm actually going somewhere here; stay with me.

I understand that it's very difficult to think clearly when you're scared to death; and I understand that when you're scared to death, it seems to make sense to do the same thing every month and expect a different result. Like draining your retirement accounts to pay credit cards.

But here are some warning signs that you need to track down an experienced bankruptcy attorney, whether you live in Phoenix, Scottsdale, Chandler, Tempe or Chicago, for heaven's sake:

-you have received a letter indicating that you will be sued if you don't make a payment;

-your income has dropped so that it is inadequate to pay your monthly living expense, and to make debt service on your historic debt;

-you are taking money from one credit card to pay other credit cards (stealing from Peter to pay Paul);

-your car has been repossessed and you are waiting around for the deficiency judgment;

-you have been informed that a trustee's sale is going to take place as to one of your real properties;

-you are afraid to answer the phone because you know that there are cranky creditors on the other end;

-you can't sleep at night because you're scared about the debt that you know you can't pay;


Please, don't wait until you have zero resources and you can't buy food and pay for electricity.

That's a bad decision tree. Don't water it.

p.s. remember that if you decide you want to visit with me to discuss a bankruptcy filing, I want you to first do the homework on my Arizona Bankruptcy Homework Blog, because I want you to be educated about the bankruptcy process in Arizona. 

Full post as published by Arizona Bankruptcy Attorney Blog on December 04, 2010 (boomark / email).