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Bankruptcy after the Pandemic

Posted by Brian Hallaq | Jan 19, 2023 | 0 Comments

As life begins to get back to normal after the years of life altering affects of Covid-19, we have to start figuring out solutions to the financial damage that many people experienced.
Many people faced serious financial issues as a result of the pandemic that are often not being felt until now.
Years of unpaid mortgage payments. Unemployment benefits that were not calculated correctly and the State is claiming they overpaid you and they want to collect. Unpaid rent. Personal loans taken out to fill in the gap in income. Large credit card bills. SBA and EIDL loans that are too big to repay.
These are the kinds of things that we are seeing on a regular basis in our office. As we often say, you gain nothing by ignoring the problem. The best thing that you can do is to speak to an experienced Bankruptcy attorney. An ethical Bankruptcy attorney can advise you as to whether or not Bankruptcy is a good solution to these kinds of problems.
At the same time, you can do yourself a huge favor by assisting the attorney in their investigations. The best thing that you can do is keep good records. Of course, this is easier said than done, because paperwork can feel overwhelming, but believe me that your attorney will appreciate having access to those records.
A great example are SBA loans. These loans can take many forms, some of which are easily eliminated by a Bankruptcy, while others can be more complicated. Your original loan documents and any security agreements will be absolutely necessary for your attorney to make a good assessment of your situation. Your attorney needs to see things such as UCC Filings, Security Agreements, and Promissory Notes. If you default on your SBA loans, these loans can be reviewed by SBA Loan Specialists for possible collections or even to contest a Bankruptcy petition.
Similarly, other infusions of money into your household will be examined carefully by your creditors and your Bankruptcy attorney benefits greatly by understanding the circumstances by which you acquired your debt.
For example recent credit card usage can be routine, or it can be construed as fraud by your lender and it is best to go over these transactions with an experienced attorney. It is not unusual for people to take out huge credit card charges that later become much smaller as the available credit on each card goes down. By the end, people are reduced to using their credit cards for groceries and gas, and they often forgot the large jewelry purchases and high-end electronics that were purchased during the pandemic.
Right now, many creditors are willing to offer settlements and many people are taking advantage of those options, but before you pay large amounts of money towards one debt, while ignoring other debts, you should consult with an experienced Bankruptcy attorney to find out if a debt settlement is the best course of action, or merely a band-aid on a much larger problem.
Again, your records extremely helpful. One good thing about the pandemic is that so much of our paperwork was converted to electronic means and transmitted via email. Email is a perfectly valid form of record keeping and so don't delete those old emails as they may be very useful to your attorney.
Just remember that whatever solution you choose must solve all of your problems. Don't tackle your financial problems in a piecemeal fashion or by who is harassing you the most, while ignoring the rest. Having good solid information is the best tool at your disposal and it will help you to make the most informed decision.

About the Author

Brian Hallaq

My name is Brian and I have been a practicing attorney in Bankruptcy for over 20 years helping thousands of clients.  I have worked for the Chief Judge of the United States Bankruptcy Court for the Western District of Washington, as well as several small boutique Bankruptcy law firms handling Bankruptcy cases in Washington State and the State of California.  I have litigated for and against major banks, and I have recovered millions of dollars on behalf of clients in my career.


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Are creditors calling you? Is there an unexpected job loss? Increasing medical bills? Are you using your credit cards to buy groceries and cannot afford to pay the minimum? We understand the stress that financial hardships can cause to you, and the confusion about choosing the right solution. As experienced Bankruptcy attorneys, Brian and Diem Hallaq can help you regain control over your finances. We help clients who want to file Chapter 7 and Chapter 13 Bankruptcy petitions.

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