Bankruptcy

Hope is Not a Strategy

By Bill McLeod, Esq.

In the last several months, people in precarious financial circumstances who are either facing bankruptcy or are already in bankruptcy are basing their financial recovery strategy on one thing: hope. They hope the mortgage company will work with them. They hope a bankruptcy judge will see things their way. They hope that they will get a better job, more income, or that things will change. If this sounds like you, understand this: if the foreclosure is tomorrow, next week, or even next month, hope is not a strategy.

You might consider filing chapter 13 to stop a foreclosure sale. The foreclosure auction will stop, but you?re still going to need a game plan, and that game plan ? more often than not ? includes income. When I speak with debtors who are considering bankruptcy at the 11th hour, I ask them one simple question: ?how are you going to pay the mortgage(s) and your chapter 13 plan payments?? The answer should start with something like ?I?m going to start a new job this month?, ?I?m bringing in roommate who will help me pay the mortgage payment? or ?I?m going to be making substantial cuts to my living expenses.? And while it should go without saying, those answers should be truthful and based on fact.

The answer should not be ?I hope to get a better job?, ?I hope that my mortgage company will work with me? or ?I hope that the market will get better.? Why? Because it?s not an answer. And it?s not a strategy. Of course, when I hear such things from debtors, I find it is usually at the 11th hour. And by then, I have to wonder if hope is all that is left.

Blind hope is not an option for people on the eve of a foreclosure auction. Resting on hope is like resting on the platitudes of political candidates: it makes you feel good at that moment, but when the election is over, and the confetti is being swept up, the financial mess is still going to be there. Then, there is no escaping the fact that hope no longer matters; only action does. And if there really is no game plan that is grounded in reality, if there is no way to make it happen, then all that hope has been wasted. All that?s left is more misery. And that is why, when it comes right down to it, hope is not a strategy.

Full post as published by McLeod Law Offices on November 03, 2008 (boomark / email).