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10 Feb 2014

Money may not buy happiness, but the lack of it can certainly inspire negative emotions. When we lack financial stability it often causes sadness, grief, and shame, but these are just the beginning when it comes time to file for bankruptcy. There is something about admitting defeat and formalizing that defeat in a court of law that makes a financial disaster even more palpable.

The most common form of consumer bankruptcy in America is Chapter 7, which involves handing over one's non-exempt assets to a trustee, who liquidates them to pay the filer's creditors. This normally eliminates all or most of their debt. Another form of bankruptcy, Chapter 13, is where one's debt is paid off through a financial reorganization, with the goal of preserving certain assets. People who file for Chapter 7 are usually in such a state of financial ruin that it's not worth filing for Chapter 13.

While we often focus on the financial consequences of bankruptcy and the damage it does to one's credit score, the mental burden can be more overwhelming. In fact, its far-reaching effects can become psychologically burdensome, causing undue stress on important family relationships. It is important to acknowledge this and be proactive about preventing permanent damage because family support is so important during this process.

Focus on finances and emotions simultaneously

It is important to take the appropriate financial steps when facing bankruptcy, such as compiling a list of debts and hiring a bankruptcy lawyer, but try not to neglect your emotional well-being. Many people find that by the time the file for bankruptcy they have juggled debt for so long that they are emotionally spent. According to one financial counselor, "In many cases, a person's self-esteem takes a stronger hit than their finances."

As more people cope with the fallout from a struggling economy, the financial therapy industry is gaining a foothold. People are in need of emotional support when they go through a monetary crisis, and while many general psychologists offer treatment, it might not address all the concerns involved with bankruptcy. Financial therapists can help address a patient's worry about their family's anger, as well as their anxiety and fear about the future. Bankruptcy may present some obstacles in life, but for many people it is also a great relief. Even the black marks on a credit report will eventually disappear, and in the long run people look back and realize it was their only option.

Bankruptcy attorneys will often provide solace to their clients by telling them they are not alone; that in fact there are plenty of other people who have fallen into bankruptcy and it is not the end of the world. Statistics prove this out, and it's important that people realize this. In reality, filing for bankruptcy gives them the breathing space to make a fresh start. Oftentimes, once the decision is made to file for bankruptcy, clients are in a much better frame of mind than they were at the first meeting with their attorney.

According to a recent article in U.S. News and World Report ("Surviving the Emotional Toll of Bankruptcy"), many perceptions about bankruptcy are falls. Financial therapists say that while many general psychologists offer help in this area, it is not always the right kind of support. Some bankruptcy filers often worry that they have accumulated so much debt that even a bankruptcy won't be enough. Others worry that the poor economy will continue to get worse, or that their credit score is permanently destroyed. Such misguided fears only make the process of bankruptcy more disturbing. In reality, no matter how much someone owes, bankruptcy is always a viable option, and the effects of it will eventually be erased.

Blame is another part of the grieving process. While many people know that the poor economy caused their situation, they still must take ownership of what things they did have control over. In this case, a financial therapist will try to help a client separate their own worth from their personal worth. This can be difficult for many people, who have been trained to believe that their financial success is the only success that matters.

Ultimately, relief from the mental burdens of bankruptcy is dependent upon how well a person prepares to handle finances in the future. Setting smaller, achievable goals can be a great way to rebuild confidence because individuals can celebrate minor victories along the road to recovery.

18 Jan 2012

What may come to mind for many people considering divorce in Colorado is what will happen with the kids, who will get the home and how will I make ends meet after the divorce?

But what they should also consider is whether a Colorado Springs bankruptcy could actually help them during the divorce process. Our Colorado Springs bankruptcy lawyers have been able to help many clients who are going through a difficult divorce and who realize that filing for bankruptcy provides them with financial help at a difficult time.

While people consider how assets will be split, what about debts? Unless it is paid off, the house is likely more of a debt than an asset, plus there are car payments, credit card bills, utilities, memberships and other bills that will stack up.

This falls into the field of expertise for a divorce lawyer. But perhaps consulting with a Colorado Springs bankruptcy lawyer, who has the skills to assess your financial situation, would be a smart move if you are considering or in the middle of a divorce.

Money and divorce go hand and hand. And while there are certainly emotional issues that must be taken into consideration during this difficult and life-changing time, a spouse must also be diligently looking out for their financial prospects after a divorce.

Consider recent statistics from the U.S. Census Bureau, which reported that Colorado's divorce rate is far higher than the national average and among the highest in the country. In 2009, the average divorce rate for men was 9.2 percent and for women, it was 9.7 percent. In Colorado, the divorce rate for men was 11.6 percent and for women it was 9.4 percent. So, it appears women in Colorado divorce at the national average, but men are far above the national average with widowhood making up the difference.

For couples willing to work together to this end, filing for a joint bankruptcy in Colorado Springs before or during a divorce may be beneficial to both spouses. Often, though, a divorcee may have to make this decision on their own after the divorce is finalized.

If you are struggling with debt and need to speak with an experienced Colorado Springs bankruptcy lawyer, contact attorney Stephen H. Swift at (719) 520-0164 for a free initial consultation.

01 Feb 2012

With the economy continuing on a downward spiral, millions of people are battling debt, foreclosure andbankruptcy in Colorado Springs and across the country. For many people, the stress can be overwhelming.

Medical experts have long warned that stress is a major catalyst for a number of serious and potentially life-threatening physical ailments, including weight gain, heart disease, gum disease, gastrointestinal problems and more.

It's a vicious cycle because the more stressed you are, the more your health suffers and the more you end up shelling out on health care - almost twice as much as someone who is carefree, according to researchers with the Health Enhancement Research Organization.

Many of the financial troubles you face can be addressed with help from an experienced Colorado bankruptcy attorney. Tackling your personal financial struggles with someone who has helped thousands of people in similar situations will not only augment the balance on your bank statements, it will also improve your well-being.

In addition to taking this crucial step to free yourself of these financial burdens, there are other steps you can take to alleviate these concerns.

First, seek help from your employer. According to a 2010 study by Buck Consultants, nearly three-quarters of all U.S. employers offer some form of wellness program, which encompass everything from discounted yoga classes to reimbursements for gym memberships. Stepping up your work-out routine will help to clear your mind and give you confidence to keep that same momentum in other aspects of your life.

If your company doesn't offer this type of reimbursement, look on sites like Groupon or search for trial memberships that might give you a few weeks free. Many gyms also want new customers, so they may be willing to cut you a deal directly if you ask.

Secondly, consider talking with a counselor. Many employers offer free or reduced-cost access to counselors on a weekly or monthly basis. Some also offer group sessions, which specifically address techniques to manage stress.

And finally, take some time each day to breathe deeply. A recent study conducted by researchers at Harvard found that meditating each day improves a person's memory and reduces stress. Even a few minutes a day can make a huge difference.

13 Sep 2012

Toni Braxton has won six Grammy Awards - and filed for two bankruptcies.

Our Colorado Springs Chapter 7 Bankruptcy attorneys understand that she intends to talk about her financial journey in an upcoming music television show.

While some may view multiple filings as a sign of irresponsibility, the fact is that there are some situations in which the filer may have little choice. It's also worth noting that someone who has already been through the bankruptcy process knows that when circumstances outside their control begin to snowball, there is no sense in wasting precious time and money in an effort to save a credit score that is likely to suffer regardless.

In Braxton's case, the first bankruptcy stemmed from a recording deal that was beyond deplorable. In fact, her late-1990s hit son, "Unbreak My Heart" reportedly earned her a total of less than $3,000.

Then two years ago, Braxton filed again after a medical ailment impeded her ability to perform Las Vegas shows she was contracted to perform. Promoters and venues lost a great deal of money, and sued Braxton. After unsuccessfully attempting to settle with them, she sought another Chapter 7 filing.

The Bankruptcy Abuse and Consumer Protection Act of 2005 changes the wait times in between bankruptcy for certain debtors. But it's not true that you have to wait eight years across the board before you can file a new bankruptcy. Essentially it works like this:

  • If you previously filed a Chapter 7 case, you have to wait at least 8 years before filing a new Chapter 7 case.
  • If you previously filed a Chapter 7 case, you have to wait at least 4 years before filing a new Chapter 13 case.
  • If you previously filed a Chapter 13 case, you have to wait 6 years before you file for a new Chapter 7 case, unless your previous plan has been 100 percent paid or you have paid off 70 percent with good faith and best effort requirements.
  • If you previously filed for a Chapter 13 case, you have to wait at least 2  years before filing for a new Chapter 13 case.

If none of your debts were actually discharged in the previous filing - that is, you merely filed for the protection of the automatic stay - than these time limits won't apply to you.

11 Oct 2012

Those who have been unemployed for any stretch no the longer it lasts, the harder it is to land a new job. 

Denver Chapter 7 bankruptcy attorneys have assisted numerous clients who were overwhelmed with debt after a lay-off or termination. Across the country, there are more than 5 million people who are classified as being long-term unemployed. Even more have dropped out of the labor market altogether. Typically, getting back on your feet without some kind of legal help with finances is incredibly tough because most people haven't prepared for such an event. Few people expect that they will be laid off and even those who do may be already working paycheck-to-paycheck and unable to save.

Now, a new study shows just how rough these folks have it when it comes to getting back into the job market.

Researchers sneakily sent out more than 12,000 phony resumes listing fictional job candidates responding to more than 3,000 job postings available online. The framers of the study set it up so that all of the candidates were qualified equally. The only thing they altered slightly was the amount of time that the job candidate was out of work.

For those who were out of work for 25 weeks or more, the news is grim.

The fake candidates who had been out-of-work for six months or less saw their call backs fall by about 7 percent. But then those who reported an unemployment of between six and eight months saw their chances plummet by 45 percent. In fact, those unemployed for longer than six months had only a 4 percent chance of being called back for an interview.

Researchers theorize that the idea is that if you don't have a job, your job is getting employment. If it takes you longer than a couple months to do so, the thinking goes, than you aren't very effective.

Of course, it's all much more complicated than that.

Those in the business world advise that, first of all, responding to online job postings isn't necessarily the way to go. You have a 9 in 10 chance of having your resume deleted right off the bat anyway. Instead, opt for networking opportunities and events, reach out to former colleagues and try to find ways to connect with people person-to-person.

26 Nov 2012

Having lenders forgive debt can be a godsend for those who are unable to pay their bills; however, depending on when this debt forgiveness occurs, borrowers may find themselves having to deal with some negative consequences when it comes to paying taxes. Also referred to as “cancellation of debt” (COD), debt forgiveness can translate into taxable income.

Specifically, when a lender discharges a borrower's debt, the lender is required to report the monetary amount of this discharge as cancellation of debt income to both the borrower and the IRS (Form 1099-C is the tax form used to report COD income to the IRS); in many cases, the borrower may have to pay taxes on this COD income.

Nevertheless, there are some exceptions to when forgiven debt qualifies as COD income, and these can include:

    • When COD income is declared during a Chapter 7, Chapter 11 or Chapter 13 bankruptcy proceeding
    • When the borrower's debts are significantly greater than his assets just before the lender forgives the debt (i.e., the borrower is considered to be “insolvent” just before the debt is canceled); however, if the debt cancellation makes the borrower “solvent” again, then the forgiven debt will become taxable COD income to the degree of solvency that the borrower has regained.
    • When home mortgage debt incurred from 2007 through 2012 meets specific qualifying factors
    • When certain deductible interest has been added to the principal of a loan

Given how complex the tax repercussions of debt cancellation can be, it's critical that those who are facing overwhelming debt and/or considering filing for bankruptcy consult with a skilled bankruptcy lawyer at the Law Office of Stephen H. Swift, P.C. Our trusted financial and legal professionals have extensive experience handling various matters of bankruptcy, debt consolidation, debt cancellation and other matters of debt relief. We can help borrowers in serious debt resolve their financial struggles in the most appropriate manner that will minimize future repercussions associated their taxes, as well as their credit score, remaining assets, etc. For more professional advice and an assessment of your best options, call us at (719) 520-0164.

28 Dec 2011

Now that the holidays are mostly over, it’s time for many to consider where they stand, financially. The holidays have historically been a time when many people buy gifts for friends, loved ones, or co-workers not just because they’re caught up in the spirit of giving, but also because they feel pressured to buy gifts that they can’t necessarily afford.

Have you been guilted, pressured, or shamed into buying extra gifts this season? Have your finances been stretched far beyond their limits? If so, it may be time to consider filing for bankruptcy.

For many, the new year is a time of renewed hope and optimism for the coming year, and it can be for you, too, even if your debts are weighing you down.

Bankruptcy, which has traditionally been looked at as some sort of failing, is actually quite the opposite. Filing for bankruptcy is a way for you to take control of your financial situation back from the predatory creditors who have taken that control away.

What better gift to give yourself this holiday season, than the renewed hope and freedom that comes with a well-timed and properly-filed bankruptcy?

In bankruptcy, many, if not all, of your debts can be forgiven, and you can create a financial plan that works for you and your family. For once, you can make the creditors work for you, instead of making you work for them.

Consider starting the new year off right, with a relieving, well-filed bankruptcy!

03 Apr 2013

If you plan to file for bankruptcy in Colorado Springs you will no doubt meet with an attorney who will walk you through all your options, but most people want a little preview before they visit a law office. Unless you've been through the bankruptcy process before it's likely you have a long list of questions, such as "will I go to court?" or "will I be able to keep my house?"

In an attempt to prepare for the inevitable it is better to seek the advice of an experienced bankruptcy lawyer and avoid the temptation to just "Google it." While there is plenty of data available about different types of bankruptcy, few online sources will accurately summarize what to expect/

Below are five things you can expect when filing for bankruptcy in Colorado:

1. You will have to go to court. Before you start worrying about a long, drawn-out court process, in most cases you will only need to attend one hearing, known as the "meeting of creditors." This is a short and simple hearing where the trustee will ask you a few very basic questions. Creditors are also allowed to attend and ask questions but they must abide by certain state bankruptcy guidelines.

2. Your case will be complete within 4 to 6 months from the date of filing. This doesn't mean you should just go ahead and file right away. While bankruptcy can be very helpful in resolving financial woes, it is not always the best solution for everyone. In addition, it's important to choose the right time to file for bankruptcy relief. Most experts recommend you wait as long as possible to file because you can only do so one time every six years. Saving this option until you absolutely need it, but you may not even need to file. For example, if you have no "non-exempt" property or wages, there is nothing that the creditors can take from you.

3. There are some very specific things that bankruptcy can do. One of the most important things is the "discharge" or elimination of debts. It can stop a home foreclosure and allow you to catch up on missed payments, and it can stop the repossession of automobiles or other property, sometimes even forcing a creditor to return property that has already been repossessed. If your wages are being garnished or a creditor is harassing you for payment, filing for bankruptcy will put a stop to that right away. It can also prevent the termination of utility services.

4. There are some very specific things that a bankruptcy can't do. One of these is the discharge of debts that arise after the bankruptcy filing. It also cannot eliminate certain rights of secured creditors, particularly with car loans and a home mortgage, which means payments must be made on a regular basis in order to retain ownership of the property. In addition, certain types of debt are never discharged in a bankruptcy. These include alimony, child support, most student loans, criminal fines or restitution, and most taxes.

5. You will need to decide between Chapter 7 and Chapter 13 bankruptcy. It's not enough to show up a bankruptcy attorney's office and just "file for bankruptcy." You must know the differences between Chapter 7 and Chapter 13 as well as which one you prefer. Below is a description of each type of bankruptcy.

  • Chapter 7: Also known as a "liquidation," or "fresh start" bankruptcy, Chapter 7 will discharge your debts on the condition that you relinquish any nonexempt property to the trustee. The proceeds from selling your nonexempt property will be used to repay your creditors but you hold onto secured property if you stay current with the payments.
  • Chapter 13: Commonly known as a "reorganization" or wage earner plan, Chapter 13 lets you keep valuable property such as a car or home, which might have otherwise been lost because of past-due payments. In a Chapter 13 reorganization you will have between three and five years to repay the arrears from your lapsed payments, but you must also continue to make regular payments.

Is bankruptcy an option for you? Only you know the honest state of your finances and whether you are being threatened with foreclosure, repossession or garnishment. Bankruptcy is a great way to proactively deal with these problems, but everyone's situation is different. If you have questions about filing bankruptcy in Colorado, talk to a professional bankruptcy attorney at the Colorado Springs law offices of Stephen J. Swift.

Photo Courtesy of Ponsulak /

15 Nov 2012

Approximately 1 in every 5 Americans older than 65 years old have been victimized by some sort of financial fraud, according to a 2010 report issued by the non-profit Investor Protection Trust (IPT). This translated to about $2.9 billion lost by the elderly in 2010, which had increased from the previous year by about 7 percent. What is possibly even more shocking than these statistics are the facts that such financial abuse in the elderly community is continuing to grow, many of these cases result in the victims being depleted of their life savings, and the elderly are the least likely to seek out legal help for their impoverished situation after such financial abuse occurs.

The most common way for the elderly to be victimized by financial fraud occurs when their assets are somehow misappropriated or stolen by loved ones or care providers, such as in-home nurses.  Another manner in which the elderly fall susceptible to financial abuse typically occurs when strangers outright scam the elderly through, for example, Nigerian letter fraud, telemarketing fraud, mail fraud, Ponzi schemes and other types of financial fraud.

While there may be an opportunity for criminal justice proceedings to prosecute the individual who had scammed or stolen from the elderly victim, the chances for the elderly to retrieve their lost money or assets can be slim, especially if the financial abuse occurred at the hands of an unknown and unidentifiable stranger; as a result, the elderly will need to seek legal help if they find themselves facing insurmountable debt and they are unable to pay their bills.

In these cases, the trusted Colorado bankruptcy lawyers at the Law Office of Stephen H. Swift, P.C. can help advise financially strapped elderly individuals on their best options for getting and staying out of debt. While bankruptcy may be the best option for some victims of financial fraud, for others, the better choice may be in debt consolidation. Regardless of your situation – even if you have previously filed for bankruptcy, our skilled financial professionals can help you financially rebuild your life.

09 Aug 2012

A new report from one of Denver's largest human resources firms indicates that salaried employees in Denver are set to receive some of the largest pay raises in the country.

Our Colorado Springs Chapter 7 bankruptcy lawyers know this is great news - but it's important to note that it's only going to affect a small number of companies and individuals, and that the increases are expected to be marginal.

A larger national study, conducted by the Economic Policy Institute, indicates that low-paying jobs aren't actually going anywhere. In fact, about 30 percent of available jobs today will put a full-time worker either just at or below the poverty line. Unfortunately, it's going to stay at that 30 percent until at least 2020, and estimations that higher-tier jobs will grow after that point aren't hopeful.

The fact is, many people took on jobs that were beneath their skill level when the recession hit. It was never intended to be a long-term thing, and that's why in the meantime, a lot of these folks racked up enormous amounts of debt - credit cards, loans, medical bills - believing that they would eventually pay it all off.

If you're one of the lucky few in Denver who will be expecting a raise, you may now be able to start putting a dent in those debts.

But to take a look at what was actually reported, Aon Hewitt, the human resources firm, surveyed some 1,300 businesses across the country. The average base pay for workers had risen 0.1 percent this year as compared to 2011.  Certain Denver companies, meanwhile, saw a 3.2 percent increase this year over last and expect a 3.6 percent increase in 2013.

To put this in real terms, if you're making $40,000 a year, a 3.2 percent increase represents about $1,280  year or $128 a month. Certainly, this is an improvement - but it's not going to pull you out of tens of thousands of dollars of debt if that's what you're facing.

Meanwhile, 30 percent of the population is making around $11 an hour, which puts them at about $23,000 a year. If you are part of a family of four and make this much, you are on the poverty line.

A bankruptcy is one way of clearing those old, looming debts to make way for smarter spending and saving habits.

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