A deficiency judgment refers to the difference between the sale proceeds and the balance on the note. The new law now prohibits any lien holder who has agreed to a short sale from pursuing the seller for a deficiency judgment.

Under this law, the holder of the note cannot demand additional compensation, aside from the proceeds of the sale, in exchange for written consent to the sale. That said, the law doesn’t prohibit the homeowner from voluntarily making an offer to the lender with the hope that the lender would agree to the short sale. Contribution to these negotiations could come from other lenders, agents, or even relatives of the borrower.

Of great value is the protection against homeowners being unknowingly exposed to deficiency judgment by short selling their homes. Protection under SB 458 applies to a broad range of 1 to 4 residential properties. Included are cash-out refinanced loans, non-owner occupied homes, second homes, and vacation homes.

Now that the new rules are in play, let the games begin.

Whether you consider restructuring your debt through a Chapter 13, or eliminating all of your unsecured debt with a Chapter 7, you are creating an opportunity to start over again fresh, without the weight of toxic debt holding you down.

Some people are hesitant to consider bankruptcy because they fear it will hurt their future credit. Reality is that bankruptcy can help improve your credit score and do it more quickly than any debt consolidation program.  Many of our clients are surprised to hear that within weeks of their discharge, banks begin inundating them with credit card offers while local auto dealers craft special offers, specifically designed to help them purchase new vehicles. Because bankruptcy can be filed only once every 8 years, bankruptcy clients are seen as low risk borrowers.

After bankruptcy, being prudent with credit opportunities can enhance anyone’s credit score. There are many cases of individuals raising their FICO to well over 700 in less than two years. Some clients are even able to purchase a new home within two years of their discharge.  Ironically, two years from now is when most pundits believe the realty market will bottom-out, yielding the best purchase opportunities.

Putting this in perspective, sales of bank-owned (REO) properties recently hit 34.5% of the market, resulting in a national price drop of 5 percent year-over-year. National home prices have fallen 11.5 percent in the past nine months, a rate not seen since 2008. Add short sales, where the bank allows the borrower to sell for less than the value of the mortgage, and prices have nowhere to go but down.

The bottom line is that bankruptcy is a tool, designed and approved by the Federal Government to help citizens improve their financial health. Each year in the recent past has seen more than 1.5 million people get a chance at starting over. Maybe it’s time for you to consider taking a Mulligan?

For Dodger Fans, Bankruptcy can be a Home Run!

Team owner Frank McCourt may have a lot in common with some of his Dodgers’ baseball fans. He can’t make ends meet. Actually, he’s having trouble making payroll. The cash starved McCourt turned to bankruptcy protection when he claimed that Major League Baseball refused to allow a television deal with Fox Sports supposedly worth $3 billion.

While Dodger debt may be a LOT bigger than that of a typical Dodger fan, both are financially struggling in weak economy. And just as McCourt turned to bankruptcy protection, so too can many baseball fans.

Consumers looking to liquidate their assets and eliminate their unsecured debt typically file a Chapter 7. Those wishing to keep their homes yet eliminate junior mortgages and create an achievable 5 year payment plan need to look at filing a Chapter 13. That is, unless their secured assets exceed 1,081,000 and/or have combined unsecured debt exceeding $360,475. Then, their best recourse would be to file a Chapter 11. Regardless, getting a fresh financial start by filing for bankruptcy protection can make you feel like you’ve hit a home run!

Selecting a Bankruptcy Attorney should be done with no less diligence than selecting a heart surgeon. Both help save lives; one can help you regain your financial health while the other may provide added years to your physical well being. You wouldn’t select a heart surgeon that has had little to no experience just to get a low price. You would want someone with years of experience and great testimonials from former patients. Your Bankruptcy Attorney should be no less experienced and have many satisfied clients (ask for a list of client testimonials).

Too many people today are seeking legal counsel based solely on price. That is a huge mistake. Consider the following Trustee’s Comments. Don’t let this happen to you! We won’t mention the counsel or the client’s names to save them embarrassment but it is public record. And this is only one of MANY such cases that were unfavorably dismissed with comments like to “counsel’s own failure to properly prosecute this case”.

Clearly, the following court document proved two axioms:

1. You get what you pay for.
2. Experience matters!

Clients of Doan Law Firm don’t need to worry. We have more than 200 combined years of experience; more than 25,000 happy clients; and, pages of testimonials. Our level of client care is among the best in the field. It’s all part of what we call the “Doan Difference.” And, to top it off, we offer a low fee guarantee.

One very powerful way a business can regain control of their finances, as well as reclaim their success, is to file bankruptcy. A Chapter 11 Bankruptcy helps a business reorganize their debt. This reorganization will make payment plans more affordable, reduce their debt, and in turn give the company a financial fresh start. Below is just a few prosperous businesses that at one point decided to turn their financial hardships around by filing for bankruptcy.

• Aloha Airlines
• America West Airlines
• Dodge
• Rolls Royce
• Pontiac
• Sears
• Stanley Steamer
• May Company
• Mervyn’s
• Robinsons – May
• Merrill Lynch
• Shearson / American Express
• Wachovia Securities
• Disney Magazine
• Life Magazine
• Warner Bros. – Seven Arts
• Warner Communications
• New York Herald Tribune
• Los Angeles Herald
• Texaco
• Blockbuster
• Crown Books
• Levitz Furniture
• Linens n’ Things

When in debt and facing the potential of bankruptcy, we often feel like slaves to our debtor. We feel this because most likely we are.

If we are unable to pay on time, we are charged more.  If we ignore the creditor, we are tainted with marks to a credit score while being charged more fees.

After years of avoiding creditors, my husband and I called Doan Law Firm. I came into their office feeling defeated and guilty. I knew those feeling were a direct result from the shame I felt after being sued not once, but twice, for not paying creditors. And the truth is I felt we deserved being sued, since we were unable to repay the debt.

After having excellent credit and being debt free, for years, my husband was in a bad accident on the job. He was not only hospitalized, but terminated from his job while laying in the ER.

When it was time to keep the lights on, I was grateful we had good credit. I figured it would allow us to make up the the difference in income we had lost from his job. But when my husband fell into a deep depression during a bad case of post traumatic stress syndrome, I felt that paying bills with credit cards, instead of having my husband worry about the finances, would be best. This ended up being my biggest regret.

Time passed so quickly and all the 0% cards soon came back at 32% and within two years we were way over our heads.

As devout Christians, I knew the debt was a sin.  First, I was not only unable to keep my word and repay the creditors, but now money (or the lack of money) had become our biggest worry! I know to worry is the expectation that God is going to fail me, yet I operated in fear trying to fix things financially the wrong way. It was wrong to ignore the creditors while I was praying for some miraculous pay off that never arrived.

We didn’t want to file bankruptcy; we wanted to pay everyone back! Our excuse not to file was a mere reflection of the pride we carried.

After speaking to a rep at Doan Law Firm, I was told that I only needed a penny to remind me to trust in God. After that phone conversation I felt God tug on my heart. I hung up with that rep and that afternoon is when I fell to my knees in repentance. I didn’t realize how much I needed to repent from. I had to repent from mismanaging money, the spirit of entitlement ( I wanted to keep living the same way I did before the accident), I had to repent from lying ( I spent months lying to creditors telling them I would call them back and never did),  and from the spirit of pride which kept me from getting help sooner. I fell on my face asking God to forgive me for being in debt, regardless of how I got there. I hadn’t realized how much was attached to the debt and how much it was blocking me from growing spiritually.

We had been tithing for years and still weren’t able to find financial overflow or freedom from living pay check to pay check.

It finally all made sense to me when I repented right before paying for our bankruptcy. God removed our pride and sense of entitlement, and He reminded us during this process how important it is to live right in every area of our life, and this included in our finances.

Recently, after we have arrived to a new season in our walk with the Lord, I lost one of my biggest accounts. I was worried, but the week we repented I saw a miracle. I picked up 3 new accounts, which tripled my income. I praise God because his love and mercy never failed us. He forgave us. In our case we needed to repent in order for the windows of heaven to release all that he had in store for us. It’s amazing all the goodness that comes from walking in obedience!

“Thank you Doan Law Firm for showing us love and compassion; we really needed it.”

“But won’t bankruptcy destroy my credit?!” We have heard it time and time again and are sure you have had that thought once or twice, especially if you are contemplating filing. The truth is bankruptcy actually acts as a repair for your credit.

Think about it, if you are having thoughts of filing bankruptcy, you probably aren’t in the best of financial situations at the moment anyways. The piling of bills and never ending debt aren’t looking so good on your credit report. If you’re trying to repair your credit score without bankruptcy, it may be like trying to swim up a white water rapid. No matter how hard you swim, the waves are too strong and will only push you back.

All of your bills and large amount of debt will keep pushing you back from achieving the credit score you want. Instead of fighting the rapids, you should think of exiting the river and walking up the stream.

With Bankruptcy, you discharge all of your stressful debt and are given a fresh start. Yes, your credit score will decrease when you initially file, but think of how easy it will be to reestablish an excellent credit score without having all of the baggage on you. You can walk up that river with ease; nothing will push or hold you back.

You can achieve that credit score you once had or always dreamed of once you rid yourself of everything that is holding you back and keeping you from what you financially desire.

Here is how it works: years ago, when home values were at their height, home owners used the equity in their home(s) to borrow against. They took out second mortgages, third mortgages, and even fourth mortgages. Those mortgages were secured by the equity in the home. But today, one in four California homeowners is upside down (where the liens against a property exceed the value of the property).  In many cases, debtors can completely eliminate junior liens either in a Chapter 13 or Chapter 11 Bankruptcy!

For most individuals and families, eliminating their junior mortgages and creating an affordable three to five year repayment plan on their debt is better than anything possibly achieved through a loan modification. Consumers are able to get caught up on delinquent mortgage payments and eliminate their junior mortgages upon the completion of their Chapter 11 or 13 plan. Consumers then walk away from their plan, free of all unsecured debts and their second mortgages in some cases. It truly represents a fresh start.

The great news is that by using this plan, it is possible to stay in your home while paying only a percentage of your unsecured debt even though you may be making less than you did several years ago.

The only shame is that most people who qualify for this type of bankruptcy don’t even know it exists!

To read the full story click here

In California, consumer bankruptcies rose 25% in 2010 and were up 9% nationwide. There were 24,117 consumer bankruptcy filings here in the Santa Ana division of the Central District of California…and that was just in the first quarter of 2010! The majority of those were Chapter 7 filings to liquidate assets and eliminate unsecured debts.

What should be of great interest, especially here in South Orange County is the growth seen in Chapter 13 and consumer Chapter 11 bankruptcy filings. In both of these, the consumers typically are able to keep their homes, eliminate their junior mortgages (i.e. 2^nd, 3^rd, and 4^th mortgages) entirely, and even reduce the amount owed on other secured debts. When an individual does not qualify for Chapter 13, they often consider a Chapter 11 bankruptcy.  For example, if a debtor’s secured debt exceeds $1,081,000 and/or combined unsecured debt exceeds $360,475, and the debtor wishes to keep delinquent assets, the only viable bankruptcy recourse would be to file for Chapter 11 bankruptcy protection.

To read the full story click here

Do you get extremely anxious when you talk or even think about money? Are your bills piled so high that they sometimes spill over? And, when you do open those much feared envelopes, do you just peek at the minimum payment line? Like millions of others, you may be suffering from the FUD Factor, FUD standing for Fear, Uncertainty, and Doubt. Most psychologists will agree that this can lead to financial denial.

Denial is a disorder that plagues many Americans and leaves them avoiding and fearing anything having to do with finances. As one would suspect, the repercussions can be significant. Your bills, creditor calls, and debt will continue to grow. You may be optimistic and think everything will eventually work itself out, but that’s just the denial speaking.

There are various circumstances that could lead to having financial denial. If you were brought up in a background where talking about money was considered inappropriate, you will most likely feel uncomfortable or anxious when speaking later in life about it. On the other hand, those that grew up watching their parents argue over money will probably be fearful of the topic altogether.

Financial denial can lead to devastating outcomes, including divorce and even suicide.  It is crucial that you address the issue before any of these effects occur.  Bankruptcy, Debt Negotiation, and Tax Negotiation can help. That’s what we do. We help clients understand not only their situation, but more importantly, their options. We are here to help our clients find a path toward financial relief and a fresh start. By minimizing and wiping out their debt, most clients are able to focus on getting their disorder controlled and their financial lives in order.