Richard J. Shurtz, Attorney at Law

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Edmonds Bankruptcy Law Blog

How debt relief could make finding love a little bit easier

Living with high levels of debt is difficult, and can impact many different areas of a person's life. For some people, excessive debt can even have a negative impact on their ability to find love and build a lasting relationship. Most Washington residents know that money management is one of the top causes of contention between partners. What many fail to recognize is that a lack of debt relief can mark someone as a "bad bet" when it comes to choosing a mate.

Recent research suggests that a large percentage of people consider student loans and other types of debt to be "baggage" that is brought into a relationship. Concerns over how that debt will be managed and how long future debt will be addressed can cloud an otherwise promising relationship. People who are thinking about a partner's debt are likely looking for certain answers.

Foreclosure scam results in prison sentences for 3 men

For many Washington residents, owning their own home is the culmination of a long held goal. A great deal of pride comes from purchasing a home of one's own, and when that home is threatened due to financial pressures, the stress can be unbearable. Many homeowners will go to great lengths to keep their property out of foreclosure, and that leaves them vulnerable to many different types of scams.

An example lies in a scheme that led to prison sentences for three men. The group ran a company known as Star Reliable Mortgage, which promised distressed homeowners a chance to own their homes "free and clear." The company collected up-front fees, and in return filed fraudulent documents in county court offices. One approach was to file fictitious trust documents to make it appear that a different party was a trustee for a property. That slowed down foreclosures in a process known as "clouding the title" of a home.

How Chapter 7 bankruptcy will impact a 401(k) account

Reaching the decision to seek bankruptcy protection is never a simple or easy matter. For many in Washington, there are a number of considerations that come into play, including how a Chapter 7 bankruptcy will impact their retirement savings. The following information is offered in the hopes of clarifying how these retirement savings vehicles will be affected by the decision to seek debt relief through bankruptcy.

In a Chapter 7 bankruptcy, filers must claim all of their assets as well as their debts. The bankruptcy trustee will then determine which assets to liquidate, and the proceeds are used to pay creditors. However, there are limits to the assets that can be disposed of in this manner. Fortunately, an individual's 401(k) account is usually protected from loss during bankruptcy.

Is the human brain to blame for credit card debt?

For many people in Washington who find themselves in serious debt, the manner in which they got to that point is not always clear. Even well-educated, competent and otherwise successful individuals can become mired in credit card debt, often with little understanding of how those balances grew so high, so quickly. According to a recent article on the psychology of debt, it may be that the human brain is simply unable to fully comprehend the concept of credit, which can lead to trouble.

Think about the idea of debt. Our ancestors did not operate on a system of credit; they simply traded goods for what they needed to survive. That was an innately tactile transaction -- there were literally items of value that passed from hand to hand. Today, we simply swipe a card to get what we want or need, and that process does not have nearly the same impact on our brains. The end result can be a detachment from the realities of our spending, and an inability to lose the proper perspective on financial transactions.

Tips to help young people achieve lasting debt relief

Struggling under a mountain of debt is a difficult way to live and is a major source of stress for many Washington Millennials. Young people often find that they have accumulated a large volume of debt through borrowing to fund an education, addressing medical emergencies or simply overspending and relying too heavily on credit. Once the situation becomes untenable, many will search for ways to find lasting debt relief. The following tips are offered in the hopes of building habits that will relieve financial pressure and promote stability.

One of the most important things that young people can do to curtail debt is to have a clear understanding of their finances. Overspending is easy when an individual has no idea what he or she has in the bank. In fact, it can be argued that banks encourage overspending by offering programs to cover overages in one account with the balance of another. The best way to stay on budget is to have a clear line in the sand in terms of discretionary spending, and to enforce that line on a daily basis.

How to maintain financial stability after personal bankruptcy

When a Washington family faces the need for bankruptcy relief, the immediate concern of everyone involved is to find a way to put an end to the unbearable mountain of debt. Very often, little thought is given to how life will look after personal bankruptcy, although many people worry about how their lives might change. In reality, there are many ways that life can improve once a personal bankruptcy is complete. Understanding how to alter one's spending and saving habits is one way to make the most out of this fresh start, and to find a lifetime of new horizons.

When it comes to curtailing spending, it is important to understand that simply accumulating "things" is not a path to health and happiness. While there are certainly benefits that come with some items, most people tend to overspend on material things. It is easy to forget that possessions will wear out, become obsolete or be lost or damaged over time. What endures are the memories that people make with those they love and respect.

Could the proposed health bill lead to more medical debt?

Many Washington residents are aware that the United States Senate is currently considering a new version of the health care bill. The proposed legislation has led to a great deal of debate, as well as concern about how a new system might affect their families. Some experts believe that if the new version passes as written, more people could be vulnerable to high levels of medical debt, and could pay a serious price in terms of their financial and physical health.

One of the biggest concerns involves sizable proposed cuts to Medicaid. That could leave as many as 15 million people left out of the program by the year 2026. If those individuals are unable to secure health coverage elsewhere, then they could encounter staggering levels of medical debt when they fall ill or become injured.

Why people seek bankruptcy protection during retirement

Ask 100 people what their plans are for their retirement, and it is likely that they will give 100 different answers. Few people, however, would say that seeking bankruptcy protection is on their list of goals to accomplish during their retirement. Unfortunately, that will be the outcome for some older people in Washington, and the reasons behind that choice will sometimes be out of their control. The following are some of the more common reasons why older Americans face bankruptcy.

Medical debt is a significant factor, and can lead many people to seek bankruptcy in their later years. According to a study conducted at Harvard University, around 62 percent of personal bankruptcies are filed because of medical debt. Even more distressing is the fact that of those who filed, 72 percent had some form of health coverage.

Homeowners who were trying to avoid foreclosure were ill-served

According to the Consumer Financial Protection Bureau (CFPB,) a company that promised to assist homeowners who were at risk of losing their homes failed to meet that obligation. An investigation into the matter found numerous violations of loan servicing regulations, and resulted in a fine of more than $1 million. The move should serve as a cautionary tale for Washington homeowners who are facing serious financial strain, and looking for ways to avoid losing their home to foreclosure.

The action was taken against Fay Servicing, a company that has worked with more than 85,000 borrowers over the past decade. An investigation completed by the CFPB found that Fay Servicing kept borrowers in the dark in regard to their foreclosure prevention opportunities. In addition, the company moved forward with foreclosure proceedings on borrowers who were actively seeking foreclosure relief options, which is in violation of CFPB regulations.

Understanding credit utilization after Chapter 7 bankruptcy

Once a Washington consumer has taken charge of his or her financial future by seeking the elimination of unsecured debts, the next step is to begin rebuilding a solid credit score. Many people believe that completing a Chapter 7 bankruptcy will lead to a permanent black mark on their credit, and an inability to secure new lines of credit in the years to come. In reality, however, there are many ways to raise a credit score after a successful bankruptcy.

Understanding the role of credit utilization is an important part of that process. When looking to boost one's credit score, it is absolutely imperative to learn how those scores are calculated. While the exact formulas used by credit bureaus are not made known to the public, financial experts have determined the "weight" that various uses of credit are given when creating the scores. Credit utilization accounts for as much as 30 percent of the scoring rubric.