Of course it does. I know from my own personal experience. Back in 2005 after a nasty divorce, I was forced to file my own personal bankruptcy. I had to appear at a 341 hearing in front of my peers; the people I practice with. It was embarrassing and humiliating; the hardest thing I’d ever done up to that point in my life, but it had to be done. I hired a very good lawyer, I didn’t go cheap and everything went very smoothly; I got my discharge and I was able to rebuild my credit rather quickly.
The biggest misconception of bankruptcy is that everyone gets hung up on the filing remaining on your credit report for 10 years and you won’t be able to get credit and you will be “blackballed” for any type of financing for that entire period – but that’s just not true at all; if you approach your credit properly and do the right things, you’re able to get your credit score back in the 700’s quickly. In my own personal situation, I was able to get my credit score above 700 within a year to a year-and-a-half after filing my personal bankruptcy.
What’s really special about my firm is that we provide a credit rehabilitation service as part of our package; this is something that no one else does. We have an exclusive partnership with 720 Credit Score, which is a company started by Philip Tyrone out of Arizona; Phil is a top-shelf guy who is committed to helping people get back on their feet. His approach to the whole industry is very similar to mine; our goal is to not only get you out of your current mess, but to help you design a life for success. My goal is for you to succeed and do well; I want every client to do well.
Do You See a Typical Person File for Bankruptcy?
You have to understand that Northeast Michigan has gone through some really challenging economic changes over the past 20 years. Michigan has the largest mass of fresh water anywhere on the planet. General Motors took advantage of that asset and we had three foundries that in this area that poured iron for World War I, World War II, Korea and Vietnam, and then they closed 2 foundries down, cut the remaining foundry back to several hundred workers – GM moved out of town.
Here in Michigan, we’ve been through tremendous hardship and I see many people who are trying to get a grip on that because, historically, every generation thought they would do better than their parents financially, but with my generation, the tail-end of the baby boomers, we don’t see that. What’s happened with respect to the General Motor situation is that the UAW pay system now has three tiers; Tier 1 is the old school, who make $25-$30 an hour, which skilled trades probably getting double that, but the typical production worker at Tier 2 or 3 makes $12 an hour, which means they get about $30,000 per year, which doesn’t go very far with two people working and two or three kids.
It’s been a real challenge and there is no longer a typical client; there used to be; it used to be a single mom, post-divorce, struggling with a minimum wage or waitressing job, but now it ranges everywhere from the 22-year old who just became buried in debt through bad decisions to the75-year-old retiree who is living on a fixed income who has no choice but to file.
What Are Common Reasons That People File for Bankruptcy?
Historically, if you look at the public purpose behind the bankruptcy law, it has always been to provide a relief valve for the capitalist system so that they could get a “fresh start”; to encourage people to take a risk. That’s best exemplified by the stories of Henry Ford and Walt Disney, each of whom filed bankruptcy four times before they finally hit on a winning combination.
Unfortunately, bankruptcy has such a horrible connotation; everyone talks negatively about the “B” word out of what is a lack of understanding or education; people don’t understand how it works. Once they understand it, they’re much more comfortable with the process and once they get through the 341 hearing, they realize that they will make it and that it isn’t just fiction and the idea of a “fresh start” is a reality.
Many discover that Chapter 13 bankruptcy is the most powerful financial reorganization tool in the free world. In all Chapters, people discover the real power of the Automatic Stay. Once you file your petition, the stay goes into effect and wage garnishments stop, income tax refund intercepts stop; every collection effort against you stops, so everyone can take a breath and collect their thoughts, and get on the right path; the power and sanctity of the Automatic Stay injunction is held inviolate.
The biggest challenge for most families is budgeting. In this debit card swipe world, no one really sits down and writes out checks and balances or reconciles their checkbook and too many of us live based on our account balance, which is a very dangerous way to live.
For more information on Filing for Bankruptcy, a free initial consultation is your best next step. Get the information and legal answers you’re seeking by calling Attorney Mike Shovan at (989) 465-8144 today.
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