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OVLG Blog

5
July
2010
Are you or a loved one a member of the armed forces and facing bankruptcy? If so, then you should know that your (or your loved one’s) bankruptcy procedure will be slightly different than for a civilian. Bankruptcy is a court procedure governed under Title 11 of the United State Code. Most individual bankruptcies are filed under Chapter 7 or Chapter 13. Chapter 7 bankruptcy is also known as liquidation bankruptcy. Under Chapter 7, a court appointed trustee sells your non-exempt property and distributes the profits among your creditors. Chapter 13 is also called “wage-earners bankruptcy” because it is designed to help those people who are employed pay off their debts within 5 years. A member of the military is actually given more options in filing for bankruptcy than a civilian is. In order for a civilian to file for Chapter 7, they must qualify under an income test called The Means Test. In order to qualify for under The Means Test, the person seeking to file under Chapter 7 must make less than the median income for their state according to the IRS and the most recent Census. However, a member of the military does not have to qualify under The Means Test. When changes were made to the bankruptcy code in 2005, members of the military were specifically exempted from having to qualify under The Means Test, making it easier for a member of the military to file Chapter 7. In addition, members of the military can take advantage of a special act called the Servicemember’s Civil Relief Act (SCRA). SCRA protects servicemember’s ability to be assigned to active duty outside the US and still file for bankruptcy relief. Under SCRA, any civil case, including bankruptcy, can be postponed without damaging the servicemember’s interests if they are assigned to a station outside the US. This means that if a member of the military files for either Chapter 7 or Chapter 13 and is assigned to active duty outside the US; the bankruptcy action will essentially be put on pause until the servicemember returns to the US. The purpose behind this act is to make sure members of the military can focus on their duty to their country without distractions even if their economic circumstances require them to file bankruptcy. This is different than an automatic stay. An automatic stay prevents a creditor from suing a debtor who has filed for bankruptcy for the money they are owed while the bankruptcy proceeding is going on unless the creditor can show the court that their interest would be severely impaired by the automatic stay. Servicemembers still get an automatic stay when they file for bankruptcy in addition to the protections of SCRA. Therefore, a servicemember’s bankruptcy case could be extended for months or even years beyond what a civilian’s bankruptcy case would take, because unlike with automatic stays, a creditor has no recourse if a servicemember is called on active duty. The provisions of SCRA protect active servicemembers during their time of active duty and for 90 days after they are discharged from active duty, the military, or die. Portions of SCRA also protect reservists and inductees who have received orders to report for duty but have not reported or been inducted.

OVLG Blog

2
July
2010
So the person you thought was your soul mate turned out to be someone you wish you’d never met. You’ve started the divorce proceedings,
Debt and Divorce
but don’t know what to do about all the debt you and your soon to-be-ex-spouse have accumulated. Here are some things you should consider. The Pre/Post Nuptial Agreement The first thing to look at when deciding who has responsibility for the marital debts during a divorce, is whether there is a pre/post nuptial agreement (commonly called a pre-nup). While many people think that if their fiancée or spouse asks them to sign a pre/post-nup they aren’t trusted, a growing number of couples are making them in order to protect their individual interests. If there is a pre or post nup, then unless the agreement is invalid, the agreement controls what happens to the couple’s assets and liabilities during a divorce. If there isn’t an agreement or the agreement is invalid, then the laws of the state concerning property division control. When dealing with debt in any state, there are times when one ex-spouse does not (either because they’re angry or simply don’t have the money) pay some or all of the debt the divorce decree says they are responsible for. In this case, the other ex-spouse has two choices. The non-defaulting spouse can go to court and have the debtor spouse explain why they’re not paying the debt (which in some circumstances can lead to fines and jail time for the defaulter) or they can pay on the debt and go to court to get reimbursed. It all depends on how messy the divorce was. State Laws In the US states can be divided into two different categories depending on how they deal with the distribution of property between married couples. A small minority of states, mostly in the portions of the country the US acquired from France or Spain, are community property states. The majority of states in the US are “common law” or “equitable distribution” states. Community property states In most community property states, debt acquired during the marriage is considered as belonging to the couple, just like any assets acquired during the marriage. Community property states split marital property and debt right down the middle. Each person gets half the assets (or their fair market value) and each spouse becomes responsible for half of the marital debt. In order to determine which ex-spouse is responsible for which debt, the courts usually look to see who initially agreed to be obligated for the debt and whether the debt was for the family as a whole or just one spouse. Common law states Common law states split debt in one of two ways. They can split marital debts between the two divorcees, just like a community property state or they can divide them according to what seems fair to the judge. Usually, when dividing debts, the ex-spouse who gets most of the assets will get most of the debts as well. The judge can also look at each debt, see what it was for and who agreed to be liable for it and divide it that way. Some Tips Going through a divorce is stressful for you and your family. Going through a divorce and dealing with debt can be even worse. Here are some tips you can follow to make your life easier when dealing with both: •Find yourself a divorce lawyer. An experienced divorce lawyer will know how to get you an equitable settlement and save you the hassle and emotional stress of fighting with your ex. •Don’t hide any assets or debts from your ex. It is always better to be honest and open with your lawyer and with your ex than to lie and risk getting caught. One thing that divorcees always have problems with is what to do if your ex doesn’t pay a debt the divorce decree says he or she has to pay and the creditor comes after you. If this happens, you have two options. The first option is to send the creditor a copy of the divorce decree that shows them that your ex is responsible for the debt and you aren’t. This may or may not work, depending on the creditor. You may end up being sued by the creditor, again, depending on the creditor. Your second option is to pay the debt, making sure that you get proof that you paid it. Then go to court and get an order from the divorce judge saying that your ex has to pay you what you paid to the creditor. In this case you are essentially stepping into the creditor’s shoes. No matter what you do, know your legal rights and debt won’t bother you either during or after divorce!

OVLG Blog

2
July
2010
The booming debt relief industry has put us face to face with a very important question – how much credible the consumer debt relief programs actually are?
Consumer relief program
The doubt has been further triggered by the fact that thousands of consumer complaints regarding debt relief scams are lodged with the FBI, the Better Business Bureau and the Consumer Debt Council every single day.And that makes it extremely crucial for you to ensure the credibility of the consumer debt relief program you want to opt for. Now the million dollar question is, “how to judge whether debt relief programs are trustworthy or not?” Distressed debt stricken consumers are the ideal preys for companies conducting scam debt relief services. Such consumers in their desperate attempt to rid off debts often overlook small things that would have otherwise helped them evaluate the true nature of the debt relief service. Therefore you have to be absolutely conscious, while signing up for any debt relief program. Your choice should be careful and logical. All that glitters is not gold! So, in the very first place, do not make the mistake of fathoming authenticity by the glitzy appearance of the debt relief company. You must thoroughly get yourself informed about the company’s reputation and its debt relief programs before you decide to hire its services. You can gather references on the company's history and debt relief services or you can ask for your friends’ and acquaintances’ opinion about the company. You can also check out the company’s services and testimonials on the Internet. Also you must check the following things: •Is the company providing complete information? If the company hesitates to provide complete and accurate information on the debt relief programs they offer, then it is better you step back immediately. •How much is the upfront fee? Many companies demand a lump-sum as upfront fees for services like debt settlement and debt consolidation. It is advisable that you avoid services offered by such companies. •Is the company demanding very low monthly payment? If the company demands exceptionally low monthly payment for the program, then its debt relief services are likely to be fraudulent. It may be possible that the company will raise the amount after you have enrolled for the program. This can push you into further debt and worsen your situation. Hence, do not get lured by a meager monthly payment. It will be wiser if you check the whether there is any potential for hidden charges that you might incur later. •Is the company asking for redundant personal details of yours? A debt relief company should only seek your creditor’s names and contact details, your debts and the interest on it. But if you find the company to be over inquisitive about some redundant information (such as your account numbers, social security number, or other personal details) before providing the quote, it is better you reconsider their services. •Is the company affiliated to the BBB? Debt relief programs offered by companies affiliated to BBB or any other pro consumer group can surely be trusted. You must carefully judge these aspects before you take your first step towards debt relief. These are important. A little mistake on your part can put into a never ending maze of debts and liabilities. So, be well informed about everything you intend to do about your debts. After all a good debt relief service is the remaining lifeline, that can pull distressed debtors out of their liabilities and lead them to a happy debt free life!

OVLG Blog

2
July
2010
With passage of time the process of debt settlement has become much more complex and strangling. It is replete with loopholes and legal complications that are often overlooked by an individual stressed out with debts. During such depressive moments even an active mind fails to come out with the right decision. To make things worse there are creditors ready to pounce on you with incessant threats of making your life a living hell! In case you are wondering what the solution to all these problems is, it is pretty simple! When in debts it is always advisable to opt for professional help from a Debt Settlement Attorney of your state. You may question on the necessity of it and consider hiring a debt attorney just an added expense. But there are flip sides to it! Here are a few important benefits of hiring a debt settlement attorney for settling your debt issues. Take a look at them before you arrive at a decision: 1.Helps in reducing your outstanding balances: If you carry out the process yourself your creditors may not allow you to have the maximum reductions. A debt attorney being well aware of all the tactics can bring down your debts up to 40-60%. Depending on your financial capability the lawyer will set down the minimum affordable amount to be paid. He will try to get you the best deal that makes you to pay less. 2.Puts an end to all collection calls: After you appoint a debt settlement attorney to handle your debt issues, your creditors are immediately notified. From then on the creditors have to contact your attorney for any details. They are notified not to contact you directly through any means. It puts an end to all calls, actions or threatening from the creditors end. If the creditor does not follow the legal notifications then the lawyer can send a Cease and Desist Communication Letter to the creditor. 3.Helps in developing an affordable repayment plan: The lawyer acts as your financial guide throughout the settlement process. They help in designing repayment plans through which you can pay with affordable installments. 4.Convincing bankers or creditors is easy with professional help: When it comes to convincing creditors or bankers for settlement it is a tough job. Being unaware of the tactics to convince the bankers/creditors you cannot get the approval for settlement easily. The lawyer being proficient with these techniques can perform a successful negotiation. 5.Professional take on things: The debt settlement attorneys have a professional approach to every issue. As such the entire process is made simple, hassle-free and legally safe. The attorney negotiates with creditors using legal rules and guidelines. Therefore creditors cannot use any unfair means in order to retrieve credit. You can also be safe from any scams that may be involved. 6.Credit card report is taken care of: The attorney works to get you the deal that does not hamper your credit report. He obtains the consumers credit report and removes any misleading, unsubstantiated, or incorrect items present. He helps in restructuring your finance chart so that your credit ratings are restored. 7.Helps in planning for future financial management: The attorney chalks out different consumer debt relief program that helps you to settle your debts easily. The plans would help you to stay away from debts in the future. 8.Budgeting for managing your finances: The lawyer helps in drawing out a budget plan that allows you to maintain a balance. Your expenses and income are compared to assist you with monthly payments. If you can follow the budget guidelines well you can also expect to save some considerable amount on your account. 9.Removes listings from your report: Settling debts with the help of an attorney helps in removing the negative listings from your report easily. 10.Keeps you away from the ill effects of bankruptcy: With debt negotiation you can safely avoid the risks of bankruptcy. After the settlement procedure is done your report is shown as "paid as agreed" or “settled as agreed”. This helps in improving your credit card report. It is to be remembered that hiring a debt settlement attorney will be fruitful only when you have unsecured debts like credit cards, medical bills and department store cards. With secured debts like mortgages, student loans, alimony and child support the attorney can be of no particular help. The attorneys work as legal consultants offering professional assistance to pull you out of debts fast. If you are struggling hard to make up with your payments your struggle can be made a bit easier. The lawyers help you realize your rights as consumers. They negotiate with your creditors on your behalf just to make things easier. You may count them as added expense but you will realize later that the expense was worth spent. The role of the attorneys in making your settlement process legally safe in any case cannot be underestimated. With a little prudence and a little professional assistance you can easily get away from the claws of debts.

OVLG Blog

24
June
2010
Are you overwhelmed with credit card bills? Are you confused about the influences of various debt relief programs like that of debt settlement and credit counseling? If it is so then this article might clear your maze of doubts!
ovlg-debt counseling
DEBT SETTLEMENT: Debt settlement programs are highly effective in reducing your debts to a great extent. A successful debt settlement program can reduce your original debts till 40-60%. It works through negotiations creditors. The negotiation process is either carried out by the individual himself or is settled by a debt settlement company. Personal Debt Settlement: When carrying out the negotiation personally you have to be knowledgeable about the existing laws and legal loopholes. The creditors may be tacky and can get you into legal hazards. It may also be that the creditors may not agree on a debt settlement program as they will not get back their due amount. In such a situation you have to convince the creditor about your weak financial situation. The reasoning’s may also include your considering of bankruptcy filing if the settlement process is not carried out. If you are legally equipped then opting for debt settlement by your own will be highly beneficial. It will not only bring you out of your financial problem but also save you the money which else would have to be paid as company service fees. Debt Settlement Company: If you want to avoid any direct communication with your creditors then you can take the help from a debt settlement company. The prime obligation before transferring any responsibilities is to check the accreditation of the company with the Better Business Bureau (BBB). The company appoints a debt settlement attorney who works with your creditor on your behalf to get you the best deal. You may have to spend a small sum as the service charges. But the added advantages of debt settlement through a company are much more. You are not only saved from facing your creditors but are also saved from the harassments as well. At the end of a settlement program you just have to pay the reduced debt amount which is far less than what you originally owed along with a negligible rate of interest. After your debts are reported as ‘settled’ or ‘paid’ by the creditors to the credit bureaus your credit report improvements also starts. It is a faster process than many debt relief programs as such you can expect to become debt free within a short time of 1-3 years. This is a reason while most people opt for debt settlement rather than anything else. CREDIT COUNSELING: Credit counseling services are not as aggressive as the debt settlement programs. Credit counseling generally refers to a process where the consumers are educated on the ways to avoid debts. But it not only concentrates on educating on change of lifestyle patterns and budgeting alone. Credit counseling programs also aim at designing planned method of debt relief, mostly through a Debt Management Plan. In a credit counseling program the counselors also work on your behalf to reduce your interest rates to as low as 0%. While debt settlement programs get resolved within a span of 1-3 yrs, credit counseling services last for around 4-6 years. The main aim of a counseling program is to negotiate with your creditors to decide on a Debt Management Plan (DMP) that will be suitable for both the parties. Through these debts management plans you can easily repay your debt without disheartening your creditor. The plans designed by the credit counselors reduce your payments, fees and interest rates. However credit counselors just pass on the terms dictated by the creditors. As such the interest rates and payment structures are all suited to their whims and fancies. Therefore when compared to debt settlement it is always held less preferable by the consumers. There is always a notion that both the processes nearly mean the same but it is not so. From the consumers point of view debt settlement is a better deal and vice versa. Both of them have their individual advantages and disadvantages. But if you are looking out for a constructive solution to become debt free faster perhaps debt settlement will be a better deal!
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Oak View Law Group is one of the best law firms in the country. Registered with CalBar and Cal Chamber, this law firm has been protecting rights and alleviating financial stress of consumers since 2007. The firm has more than 363 live reviews to it’s credit and 5 star rating from the TrustLink. Continue reading


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