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Posts Tagged ‘Southern California Bankruptcy lawyers’

Bankruptcy…a ‘Patriotic’ Solution? Part 3: BANKRUPTCY’S BIBLICAL ROOTS

Thursday, May 5th, 2011

“At the end of every seven years you shall grant a release of debts. And this is the form of the release: Every creditor who has lent anything to his neighbor shall release it; he shall not require it of his neighbor or his brother, because it is called the LORD’s release” (Deuteronomy 15:1-2).

The Bible refers to debt as a type of bondage: “…the borrower is a slave to the lender” (Proverbs 22:7). The Bible also declares, at the end of the sixth year: “…in the seventh year you shall let [your Hebrew slave] go free from you. And when you send him away free from you, you shall not let him go away empty-handed; but you shall supply him liberally from your flock…” (Deuteronomy 15:12- 14).

Current bankruptcy laws, like the Biblical provision, allow debtors to keep certain property when they file bankruptcy. This helps provide a fresh start and discourages going back into debt-bondage, allowing them to become more productive members of our community and meaningful contributors to our economy.

Doan Law Firm is a father-and- five-son law practice founded on Judeo-Christian principles and strives to treat every client with unfailing honesty and compassion.

Bankruptcy and the Government Shut Down

Thursday, April 7th, 2011

Open for business?

What happens if you’re ready to file Bankruptcy and the Government shuts down? Don’t worry; Bankruptcy cases are filed 24 hours a day, seven days a week, 365 days a year. Thanks to the Bankruptcy Court’s electronic case filing system, not even a shutdown would slow down the filing process. Theoretically, that is. The Bankruptcy Court system uses something called CM/ECF which stands for Case Management / Electronic Case Filing. CM/ECF is a fully computerized case filing and record management system. But in the case of a shutdown, what if the system were to go down? There is no way to say with absolute certainty, but it is very likely that the filing process would progress without a glitch.

Additionally, the Courts recently stated that If Congress is unable to agree on the continued funding of government, the Judiciary is prepared to use non-appropriated fees to keep the courts running for up to two weeks.

So, the next question may be, “What happens if the government files for bankruptcy?” Hmmm, now that’s something we hope never to have to answer.

Your Underwater Mortgage Doesn’t Have to be a Ball & Chain

Monday, August 2nd, 2010

California is a non-recourse state for the first mortgage on a home, meaning that the debt is tied up in the collateral, not the individual.   This means that when the bank forecloses on your home, once you turn over the collateral (your house), the bank cannot come after you for any outstanding debt.

Using an example, say you bought a house in 2003 for $800,000 by taking out a $600,000 mortgage.  You live in the house for a couple of years enjoying relative prosperity and pay off about $50,000 of the mortgage.  Then, tragedy: the real estate market crashes and the value of the home is now $250,000.  $300,000 of your mortgage is now unsecured, which means your house is now an under-secured debt.  Say you then lose your job and cannot make the mortgage payments.  After struggling to make ends meet and defaulting on your mortgage several months in a row, the bank starts foreclosure proceedings and sells your home for $250,000.  Because California is a non-recourse state, once you turned over the collateral (your house), your mortgage lender cannot collect from you.  Even if you had $200,000 in your bank account, the lender cannot touch it.  The lender assumed this risk when they approved your mortgage application, so after you hand over the house you can walk away and live happily ever after.

However, even in a non-recourse state, if you have a second mortgage that you took out after your first mortgage, you are still on the hook for that debt.  For example, say in 2003 you bought the house for $800,000 with a mortgage of $500,000.  You then enjoyed a year of prosperity followed by a few years of hardship.  After struggling to make ends meet, you decide to take out a second mortgage on your house worth $100,000.  Real estate market crashes and the house is now worth $200,000, leaving you upside-down on the house by $400,000.  If you turn over the house, you can walk away from the first $500,000 mortgage, but you’re still liable for the second $100,000 mortgage.  Since you no longer have the collateral, the second mortgage is now an unsecured debt, which you are still liable for.

Most people cannot afford to continue making payments on a mortgage for a house they no longer own.  If you default on your payments, the bad news is that the lender could get pretty aggressive about collecting on the outstanding balance.  The lender can go to court and get a judgment allowing them to collect from you through wage garnishments or a bank levy.  For someone who is struggling to make ends meet, these garnishments or levies can be brutal.

The good news is that unsecured debts can be discharged in bankruptcy.  If you simply cannot afford to continue making the mortgage payments for a house you no longer own—or if you are facing potential wage garnishments or bank levies—call the Doan Law Firm for a free, no obligation consultation to learn about how bankruptcy can alleviate this financial stress.

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    Laguna Hills Bankruptcy
    25401 Cabot Rd.
    Suite 113
    Laguna Hills, CA 92653
    Call 888-362-6529

    Santa Ana Bankruptcy
    930 West Seventeenth St.
    Suite C
    Santa Ana, CA 92706
    Call 714-795-3536

    Corona Bankruptcy
    1411 Rimpau Ave.
    Suite 108
    Corona, CA 92879
    Call 909-708-4597

    Moreno Valley Bankruptcy
    24490 Sunnymead Blvd.
    Suite 101
    Moreno Valley, CA 92553
    Call 951-579-4756

    Watsonville Bankruptcy
    444 Airport Blvd.
    Suite 109
    Watsonville, CA 95076
    Call 888-362-6529

    Oceanside Bankruptcy
    1930 S Coast Hwy
    Suite 206
    Oceanside, CA 92054
    Call 760-450-3333

    Chula Vista Bankruptcy
    333 H Street
    Suite 5000
    Chula Vista, CA 91910
    Call 619-500-6535

    Escondido Bankruptcy
    320 East 2nd Ave.
    Suite 108
    Escondido, CA 92025
    Call 760-746-4476

    La Mesa Bankruptcy
    4817 Palm Ave.
    Suite I
    La Mesa, CA 91942
    Call 619-462-362

    San Diego Bankruptcy
    185 West F St
    Suite 100
    San Diego, CA 92101
    Call 619-234-3626