Hello this is bankruptcy attorney Jeff Kelly and Today is April the 24th 2020. Yesterday Bloomberg reported that major credit card companies are lowering credit limits because of this Corona outbreak. And what I want to talk about today in this podcast is why it is so important that you establish an emergency fund of cash for your family and not rely on a credit card to get you through rough times. I’ve heard many many clients say over the years that you know we’re that are filing Chapter 7 wiping out the debts we’re getting them a fresh start, and people will say I just cannot lose my credit card because I need the credit card.
In case of an emergency, and that is a wrong way of thinking, in my opinion. What you need is cash in case of an emergency. Because if you’re relying on a credit card to help get you through a rough time, what are you going to do when the credit card company cuts your limit off and you can no longer use it? Credit cards are not and should never be considered your emergency plan the sole basis of your emergency plan, you need cash. So as we’re going through this tough time here, there are 26 million people who are unemployed today through no fault of their own because of this Coronavirus quarantine.
So, what should a person do who has zero dollars in their emergency fund right now? Well, my advice is, as you do get your as you do get your hands on cash via unemployment payments or working part-time, whatever the sources save that money. I think an average family needs a minimum of about $5,000 in their savings account for an emergency fund. So does it make sense to pay credit card companies the minimum payments when you have no cash? It doesn’t make sense to drain your savings down to zero to make minimum payments on your credit cards? Absolutely not. That makes no sense. You’ve got to be able to have enough money for emergency food for your your utilities. So during this emergency time, food and utilities have to be number one. You’ve got to have money the setback for medicine for your family.
The next line of importance is going to be rent or your mortgage payments. Now, I talked to a lot of clients and honestly, most of us make, including myself, we make a lot of major financial decisions based on emotion. And when you are going through a tough time if you’re unemployed, you have got to throw emotion out the window because the math has to work. Math trumps everything. It makes no mathematical sense to take your desperately needed cash to pay towards debt that you’re most likely going to end up wiping out and eliminating. In a bankruptcy case. If things get bad enough, you have to eat, you have to pay the electricity, you’ve got to pay rent, you’ve got to pay mortgage if you’re getting into a city Were rent and mortgages are not getting paid and things are heading south, then you have to come up with a new plan. There’s got to be a backup plan. And I know a lot of people aren’t going to want to hear this. But, you know, I remember back in the 2008 crisis, I saw a lot of families living in one house, there were quite a few cases where there were three generations in one house. And I hope it doesn’t come to that I hope we have a a fast recovery and people are able to get back to work. But you know, worst comes to worse, we may be seeing a lot of that happen again. And we will get through it just like we got through the last crisis.
It’s very, very important that even as you deal with all this stress, and you know, dealing with the frustration, somehow you got to maintain a positive attitude, you got to stay positive, you got to keep your head up. We’ve got to march forward is the only way we’re going to get through it. And together we can. We are here to help.
If you would like to take advantage of a free consultation, we’ll be happy to talk to you go through your income and your budget and we’ll be more than happy to give you our two cents worth. You can call us at 770-881-8449. More thing I want to mention real quick. Also is community it is very important that you are not isolated as you’re going through a tough economic time. Reach out to family. Don’t if you’re suffering and the math isn’t working. You got to tell people you got to tell your family. You’re not supposed to go through tough times all by yourself. If you don’t have family close by, I advise people you know Reach out to your church. If you don’t have a church, find one, call one. Personally, I go to First Presbyterian, and downtown Rome. It’s a great church. pastors are a wonderful, fantastic resource for life wisdom, they, they help a lot of people get through tough times. And I strongly believe that as we go through this recovery, we’re going to have to lean on each other. We’re going to have to lean on family, we’re going to have to lean on, on churches. But whatever you do, don’t. Don’t be isolated.
If If you want to learn more about chapter 13 and chapter 7, I have written a book on it and I would like to get you a free copy. So go to my main website, www.kellycanhelp.com scroll down to the bottom. Type in your email address and we will get you a copy delivered to your inbox. If you prefer hardcopy. We’ll be happy to mail you one while supplies last. You can reach us at 770-881-8449. Thank you for tuning in today. Have a good one.
Here is a link to the article I refer to in this podcast.
Transcript: Hello, this is Jeff Kelly. And in this podcast, I would like to address a lot of fears that people have about losing their home during this Coronavirus pandemic. Let me just say this, I don’t believe there’s going to be a flood of foreclosures that are going to be caused by this. and I would like to explain why. Number one, the mortgage industry is not super interested in killing the United States real estate market, which is what would happen if every single person who missed a payment in April got foreclosed on. So from talking to clients and from talking to other bankruptcy attorneys, it’s my understanding, then in most cases, the mortgage companies are willing to defer up to about four months of payments. Now the problem and challenges at the end of those four months, they want their money back they want all those payments made. So I’m guessing that when we get to that point, after the pandemic is hopefully over or subsided, or maybe the quarantine will be modified to get most people back to work. I believe that the mortgage industry is going to be doing a lot of loan modifications. Again, they there don’t want to kill the entire United States real estate industry, which they would do if they foreclosed on everyone. So I think there’s going to be a lot of loan modifications. But for those people who can’t get a loan ...
Transcript: Hello, this is Jeff Kelly. And in this podcast I would like to talk about how getting a cheap divorce can set you up for a possible bankruptcy disaster. Okay, the first way that I often see it and it’s usually in almost every case, the wife that’s left with the children is so desperate to get rid of nasty, horrible husband, that she will agree to anything without a lawyer. She signs the papers and literally gives everything to him. I cannot believe how often I see this situation. Go get an attorney. There are some attorneys who will defend mothers with children and they’ll collect all the attorneys fees from the the ex husband so it’s really tragic sometimes when I you know, I see Women with kids come in and there’s just not enough money to make the mortgage payment not enough money to cover electricity bills. In those situations, you know, honestly, bankruptcy doesn’t help if we’re in a house that you need to stay in and the future mortgage payments are too high. Maybe man, I hate it. And in most cases, it’s almost impossible to go back and undo a bad divorce. It’s much better to get an attorney from the beginning and avoid those rough situations. Another thing that I see that’s often very common is people will, you know, do the no fault divorce, no attorney and one spouse will sign their interest in the house over to the other spouse, and they’ll do it in ...
Hello, this is Jeff Kelly and Today is August 31, 2020. Today’s title of what I’m going to talk about is why should student loans be dischargeable in bankruptcy? I believe that it is way past time to end the economic slavery that millions of college graduates across our country suffer and make student loans dischargeable in bankruptcy just like they were back in the 90s. Can you imagine the nightmare of living with a $200,000 debt that just hangs over your head increases with interest every single year? For many Americans this nightmare is their daily reality. Want to finance a house? Forget it. Want to finance a car? Forget it. How about getting a loan to start a new business? Forget it. When a dark cloud of student loan debt hangs over your head moving forward is economically impossible. Now, prior to 1976, student loans could be discharged just like any other debt. And over the years, restrictions were added. The first restriction was you had to wait five years after graduating before you could discharge student loans. Then the goal line got changed to seven years and then in 1998, the hammer was completely put down. Student Loans could virtually no longer be dischargeable in bankruptcy. As a result, if you want to go find a good summary on the internet about the history of student loans and bankruptcy, you can go to savingforcollege.com backslash article backslash history of student loans bankruptcy discharge the consequences of making student loans non-dischargeable in bankruptcy. Since 1998, the cost the cost of a college education has more ...