How to reach me

Communication resolves all issues - if people want to resolve them.

I cant respond to anonymous email.

However, more than once I have said "Please email me with any issues."

I am deeply committed to helping people with any issue they authentically want help with, but those who choose not to communicate must, thereby, have another agenda - not be happy and satisfied.

In the end, all I can do is invite committed and authentic communication to resolve any upset.

Thanks

Happy to hear from people

Anyone who writes I am glad to respond to and support.

Hard to respond to "anonomous" posts. My email is on this blog - I am easy to reach...unless you don't want to speak and have an agenda. I am even open for that - and always have a solution. Unfortunately, I cant help solve what I dont know about.

I welcome any and all conversation!

Thanks.

Scott

Bankrutpcy Filings Up

In the New York Times it was reported by Duff Wilson on Friday, April 20th, 2010 that there was a "Sharp Increase in Personal Bankruptcies" in March.

They seemed to be surprised. Why?

This is the perfect storm - high unemployment, real estate bubble bursts, banks out for every dime they can squeeze, medical bills soaring - what did they think would happen?

Facts:

158,000 bankruptcy fillings in March
6,900 a day
35% increase from February 2010

Chapter 7's have increased to 73% from 62% a few years ago, signaling that people are in even worse financial shape than ever. They cant even qualify for Chapter 13 Bankruptcy despite the government's attempts to hurt EVERYONE possible into a 13!

The big problem: Joblessness

Even if people get back to work, they used credit cards to pay for living expenses during their unemployment - credit card debt that history shows they will never be able to pay back. Most cards run interest at 29% plus "fees".

The next wave of bankruptcy is coming soon.

The impact will be greater. "Fewer people are trying to same their homes" said University of Iowa law professor and bankruptcy expert Katherine M. Porter. "They realize their payments are not affordable" and just cannot make the payments.

Regardless of what the public might think, bankruptcy cannot lower the 1st Mortgage Payments.

Bank of America? Bank of Fees!

Last week was an unprecedented blow for freedom for the American consumer. The Courts are finally starting to deal with the allegations of fee creating by some of the largets banks in America.

Anyone who has ever had an account with these banks knows they play with deposits and withdrawals to create fees.

In a huge suit, Miami Federal judges denied a Motion to Dismiss by a number of banks in which they are accussed of having excessive and abusive overdraft fees. This will pave the way for a class action law suit, wherein the power of a group will rival the power of the big banking institutions. There is a great article about the suit in the South Florida Business Journal.

Bank of America then announced that they are no longer charging these fees...as a feel good attempt to throw people off the scent.

Short Sales touted as new solution - Watch Out!

Short Sales! Many people in debt work tirelessly to create a short sale. 7 of 10 never close, says Florida Real Estate Attorney Michael Hirsch.

Even CNN today hopped on the bandwagon of so called "Short Sales" as the new answer to the mortgage foreclosure and debt crisis. Clark Howard reported this morning that Banks are now looking to streamline the process and approvals for short sales. That's good for the consumer, right?

Wrong.

Very wrong.

It is important to understand the public perception of what a "short sale" actually is. People in financial trouble have an even scarier notion. The popular understanding in the public is that a short sale is:

1. the sale of real estate
2. at fair market value
3. by the Owner
4. with permission from the Bank (mortgage holder)

The problem is the next myth that most of the public and definitely the person in financial trouble tend to believe:

5. that absolves the Owner of any further liability

6. and helps your credit rating

Most people believe if they short sale the property they are free of the debt surrounding the house. Not necessarily. You really have to have a competent attorney read all the paperwork. Most short sales leave you on the hook for the deficiency, that is the balance of the note after the proceeds of the sale is applied to the note.

Another issue is that often the Bank "forgives" the balance, and you receive a for 1099 for the balance of the loan not paid. That means taxes may be due.

Further, the short sale may not affect your credit at all. There is little evidence that the failure to make payments, followed by a sale in which the balance is not paid is any worse than filing bankruptcy.

Short sales are NOT the panacea that everyone is proclaiming. Banks are merely trying to mitigate their up front losses on a sale, but don't be fooled into thinking you are guaranteed to walk away with no further debt or obligation.

Think twice and read the documents 3 times!

And go see a great attorney!

Bankruptcy Filings are up, up, up!

The Associated Press reported that the number of individual (consumer) and business bankruptcies are up again this year. This increase is despite a 2005 Bankruptcy Reform Act that endeavored to make it much more difficult for individuals to file for their Federal Bankruptcy Protection that has been around since the beginning of our country.

According to court records analyzed by the AP last month, in the past 12 months more than 1.2 million people filed for bankruptcy protection. Bob Lawless, a law professor at the University of Illinois College of Law predicts that there will be 1.5 million bankruptcies this year, followed by 1.6 million next year. In Broward, Palm Beach and Miami-Dade counties 2,007 people filed for bankruptcy in March of this year.

In a speech to Consumer Bankruptcy Attorneys by Scott Forgey, citing current unemployment intensity of both numbers and durations, and extrapolating from the NAFTA bankruptcies that his firm filed in the 90's in the mid west, Scott expects that the number of filings will be nearer to 1.5 million for the next five to seven years. That the economy may turn around in 3 years is years too late for the average worker.

Most workers and consumers have less than a 3 month cash reserve, instead relying on credit. Workforce One of Broward County confirmed that most employees that are unemployed past 3 months after any severance pay are beginning to miss payments and are in danger of defaulting on major items, like mortgages.

There is no safety net. Credit Cards debt is the worst of all possible solutions to most of the desperate, but it is their last solution. The new legislation will do nothing to stop the increase of unsecured and high interest loans that people turn to as a last resort.

Who is going to help the working class?

What is going to happen to all who feed on their consumer spending?


With the working class officially bankrupt, the domino effect is inevitable.

Flordia now leads!

Yes! Florida has the dubious distinction of having the highest foreclosure rates in the country.

In an article from the South Florida Business Journal, the following stats were displayed:


"The survey found that 20.1 percent of mortgages on Florida homes were delinquent or held in foreclosure. Nationwide, more than 11 percent of American homeowners are either delinquent or in foreclosure.
The survey covered 85 percent of the country’s 1-4 family residential mortgages.
In the fourth quarter, 11.1 percent of Florida residential mortgages were past due by at least 30 days – with 4.4 percent past due more than 90 days.
Nationwide, the number of borrowers at least one month behind in their payments – but not in foreclosure – rose to nearly 8 percent during the fourth quarter. That is the highest rate of delinquency ever recorded by the survey, which began in 1972. It reflects a record 13 percent jump compared to the third quarter.
Nearly 9 percent of Florida residential mortgages were held as foreclosure inventory at the end of 2008 – the highest rate in the nation. An additional 2.4 percent of Florida residential mortgages started foreclosure during the fourth quarter.


What does this mean?

Well...think how long the inventories of "dead properties" (properties that are not producing revenue or value for consumers) will stay out of the marketplace. The average foreclosure, sale and sale to the public is well over two years...and that is if the bank can find the notes.

This property value issue is going to drag along as properties will continue to flood the market, exceeding demand (and credit availability) for years to come.

Anyone who is remotely connected to housing and construction is effectively out of work.

The ripple effect will intensify.


Bankrutpcy would allow for a quick adjustment of the valuation of the real estate...just like a stock market correction...but the banks oppose any mention of allowing the bankrutpcy courts to write down equity values...prolonging the death throws.

Unemployment - devistating impact

Unemployment - A hidden danger

Some news that will show the rocks lurking beneath the water.

On Oct. 3, the U.S. Bureau of Labor Statistics' reported that over the past 12 months, the number of unemployed has increased by 2.2 million and the unemployment rate has risen by 1.4 percentage points. Total non-farm payroll employment decreased by 159,000 in September and thus far in 2008, payroll employment has fallen by 760,000.

What is the impact? Unemployed people use their resources to survive (credit cards, etc.), but cut back consumption as much as possible.

Ripple Effect: 70% of the US economy is based upon consumer spending.


Retail will plummet - and all of the manufacturers and suppliers will starve. The economy will slow.


Anecdotal evidence:
There was a 60 Person line at Costco yesterday...people looking for any employment.


These people are easy pray for the fake solution "we will keep you in your house" debt pirates.

More suffering in the future.

Credit Scamers unite!

The next great wave of scams will be "Credit Repair" companies as credit tightens to epic proportions. Everyone under 700 can just pay cash.

Desperate People will pay these fly by night companies anything on unregulated promises. These CyberGypseys(tm) close down shop and move as the States and the FTC move in for the kill.

There was one that asked people for their Bank Routing Number! Can you believe people gave it out. I called one and they were indignant and still in operation in Tampa. The Feds know about them but cant seem to move fast.

They can spend $700B to bail out their buddies but SCREW the common guy suffering.

This from the Jacksonville News:

By DAVID BAUERLEIN, The Times-Union

Although there are reputable businesses that help consumers through the credit repair maze, state and federal agencies say they are fielding thousands of complaints from people who paid businesses to "clean up" their credit reports.

n

Last year, the Federal Trade Commission joined eight state law enforcement agencies - including Florida's attorney general - in a crackdown on 20 businesses that claimed they could strike bad marks from credit reports.

The businesses typically charged several hundred dollars in advance and promised to permanently eliminate negative information from credit reports, even if the information was "accurate and timely," according to the FTC. "

Unbelievable! Here we go into the dark ages.

New Parasites

They come, surprisingly, from California. My research team has contacted a number of "mortgage modification" companies that promise to beat your bank into submission for the low, low price of $3,000.00...cash.

When you ask for guarantees you can hear the tires squeal as they put the gears in reverse. One such parasite actually told me "We are an attorney run company." I said "Oh...so you are an attorney?" She replied "Well...no...but we have attorneys." After 10 minutes she confessed she is selling the services from her home and has never actually MET any of the attorneys, nor did she know names other than from her script.

Being an attorney myself, I was shocked that she had no idea that she was giving legal advice. She clearly had a script but departed from it to hype the sale.

Then the come on line. "You know we can check the paper work to see if any mistakes were made. If they were you get to keep your house and you don't owe anything. This happened just the other day with one of our customers. It happens all the time. We don't guarantee it, but it is worth the extra money to try."

Welcome to the debt parasite version of Las Vegas. Spin the wheel and get a house!

And as usual, they would supply no names, no proof, no nothing. They would not send a contract without a commitment - nor would they put the fee in writing without my asking 3 times. Even then they were vague.

So why do people fall for this stuff?

They are desperate, frightened and do not have the legal advice that any company would normally have. They heard about a bail out plan and they think this is somehow linked to it. People make emotional decisions at times of crisis.

Any competent bankruptcy attorney can help someone determine the next steps when facing financial disaster. Our Vigilant attorneys are clear that they honor the original intention for creating law as a profession in the first place: TO BE OF SERVICE.

Next theme...beware of the firms that are in the "business" of bankruptcy.

New Parasites have invaded - Debt Profiteers

Like hungry pirates looking for the next booty to plunder, a new form of bottom feeders have emerged in the vast fear-based marketplace: Debt Profiteers.

Debt Pirates! Ahoy!

They market to the frightened, promising to help "keep your house". In fact, they merely take money to postpone the inevitable. Today I saw a contract for one here in South Florida that charged $1,200 to merely say "find a lawyer to enter an appearance" and then they merely called the bank to get the balance and amount needed to bring the loan current.

The joke is that by law the bank must provide that information FOR FREE WHEN ASKED!

This is going to get worse.

More people are jumping on the bandwagon. The radio is full of Debt Pirates with promises of finacial salvation. Any decent attorney knows that this seldom works...debts don't just go away.

More to come.

The Rising Costs of Living = no chance of recovery

The inevitable outcome of real wages dropping or real costs inflating plus no access to credit = complete consumer meltdown. The result is much suffering or bankruptcy. Take your choice.

In my experience in Bankruptcy Law, airlines file Bankruptcy to avoid suffering, real people suffer and suffer and feel bad, lose everything and THEN file.

http://www.bloomberg.com/apps/news?pid=20601087&sid=acdPGhV4CqYQ&refer=home

Aug. 14 (Bloomberg) -- U.S. consumer prices rose at the fastest pace in 17
years in July, limiting the ability of the Federal Reserve to lower interest
rates as economic growth slows.
The cost of living climbed 5.6 percent in
the year ended in July, the Labor Department said today in Washington. It was up
0.8 percent from the previous month, twice as much as anticipated. So-called
core prices, which exclude food and energy, also advanced more than projected.
The surge last month reflected energy prices that have since declined,
signaling July may represent the peak in inflation. Still, increases went beyond
food and fuel, including gains in clothing, airline fares and education, likely
intensifying discussions among Fed policy makers about how quickly to shift
toward raising rates.
``What we are seeing is a lot of commodity-price
spillover'' into other items, said Richard DeKaser, chief
economist at National City Corp. in Cleveland, who correctly forecast the
increase in core prices. ``Numbers like this increase the hand of hawks'' at the
Fed who argue that rates need to rise to quell inflation, he said.
Commodity
costs have retreated since mid-July. Crude oil futures dropped as low as $112 a
barrel this week after topping $147 last month. Regular gasoline, which reached
a record $4.11 a gallon on July 17, has fallen about 8 percent, according to
AAA.
``We're probably looking in the rearview mirror with respect to the
worst part of inflation,'' said Joseph LaVorgna, chief
U.S. economist at Deutsche Bank Securities Inc. in New York. ``Energy prices
have declined sharply in the last month.''
Treasuries, Stocks
Treasuries
rose, with benchmark 10-year note yields falling to 3.89 percent at 4:35 p.m. in
New York, from 3.94 percent late yesterday. The Standard & Poor's 500 Stock
Index advanced 0.6 percent to close at 1,292.93.
Separate reports today
reinforced evidence of a weakening job market and continued slump in housing.
The Labor Department reported that 450,000 Americans, more than anticipated,
filed first-time claims for jobless benefits last week. Claims averaged 321,400
last year.
The median price for a single-family home in the U.S. dropped 7.6
percent in the second quarter as bank sales of foreclosed homes caused values to
tumble in three-quarters of U.S. cities, the National Association of Realtors
said.
Sales of single-family houses and condominiums fell 16 percent to
4.913 million at an annualized pace, a 10-year low, the realtors group also
said.
Economists' Estimates
Consumer prices were forecast to rise 0.4
percent, according to the median estimate of 78 economists in a Bloomberg News
survey. Projections ranged from gains of 0.1 percent to 0.7 percent.
Costs
excluding food and energy increased 0.3 percent for a second month, exceeding
the 0.2 percent median forecast of economists surveyed.
The core rate
increased 2.5 percent from July 2007, the most since January, after a 2.4
percent year-over-year increase the prior month.
Energy expenses jumped 4
percent, after a 6.6 percent gain in the prior month, today's report said.
Gasoline prices increased 4.1 percent.
Procter & Gamble
Co. was among businesses that responded to the surge in oil earlier this
year. The world's largest consumer- products company charged more for Cascade
dishwashing detergent, Iams pet food and Gillette razors to offset some of the
jump in packaging costs. McDonald's Corp., the
world's largest restaurant company, raised prices as ingredient expenses surged.
McDonald's Costs
``Beef and cheese are up, but we've been able to
mitigate that cost,'' Chief Executive Officer James Skinner said in
an interview in Beijing last week.
The consumer price index is the
government's broadest gauge of costs for goods and services. Almost 60 percent
of the CPI covers prices consumers pay for services ranging from medical visits
to airline fares and movie tickets.
Today's report ``raises the general
trajectory'' of interest rates, reducing the chance of cuts and bringing forward
the likelihood of increases, William Poole, the
former St. Louis Fed president, said in an interview with Bloomberg Television.
Poole is a Bloomberg contributor.
Food prices, which account for about a
fifth of the CPI, gained 0.9 percent after a 0.8 percent increase in June.
The increases went beyond food and fuel. Clothing expenses jumped 1.2
percent, the most since 1998. The cost of an airline ticket rose 1.3 percent and
education expenses climbed 0.5 percent for a second month.
Rent Costs
Rents, which make up almost 40 percent of the core CPI, cooled. A category
designed to track rental prices rose 0.1 percent, compared with a 0.3 percent
gain in June.
The rate-setting Federal Open Market Committee last week kept
its benchmark rate at 2 percent for a second straight meeting. In their
statement, policy makers said they expect ``inflation to moderate later this
year and next year, but the inflation outlook remains highly uncertain.''
Dallas Fed President Richard Fisher
dissented in favor of raising rates, and others have indicated concern about
leaving borrowing costs unchanged for a prolonged period. Minneapolis Fed chief Gary Stern and Charles Plosser of the
Philadelphia Fed said last month the central bank may need to raise rates even
before the housing market stabilizes.
Thomas Hoenig of Kansas
City said July 16 the current level of rates ``almost certainly raises the risk
of higher inflation.''
Wages Drop
Today's figures also showed wages
decreased 0.8 percent after adjusting for inflation following a 0.9 percent drop
in June. They were down 3.1 percent over the last 12 months, the biggest
year-over-year decline since 1990. The drop in buying power is one reason
economists forecast consumer spending will slow.
Higher gasoline bills and
tighter credit reduced automobile purchases in July, causing retail sales to
drop for the first time in five months, government figures showed yesterday.
A jump in the cost of imported goods may also give American companies leeway
to charge more, economists said. Prices of products made overseas soared 22
percent in the year ended in July, the most since at least 1982, the Labor
Department reported yesterday.

Sub Prime Mortgages and their devastating effect on the US Economy.

It is no secret that the Sub Prime Mortgage Crisis has caused turmoil amongst the powerful financial institutions and lending houses, but one aspect of the mammoth collapse that has not been talked about a lot is its effect on every day people.

When the Big Lenders get in trouble, obviously it is time for a bail out from the Feds.

But what is there available for the people at the other end of the equation?

The debtors.

And the only bail out that most regular people will be elgible for is to get out of jail.

The real solution of course is to own up to the reality and do the right thing.

Declare Bankruptcy, pay your dues and start over.

And in fact, despite the massive efforts of clever debt-for-profit institutions, people figure this out.

And now we are seeing bankruptcies in record numbers. Over a million anticipated for this year alone, and the real crisis, the one that affects regular people---the ones without jumbo jets, golden parachutes and private equity funds----is hardly underway yet.

This is going to be a roller coaster ride, both for the economy and for the regular folks.