Everyone accepts that choices have consequences, both good and bad. But when those consequences come with legal and financial repercussions, this adds an extra level of complexity. If those financial and legal repercussions have a major negative impact, it can feel too overwhelming to deal with, and people may need help.
Our bankruptcy attorneys are here to assist. With over 30 years of combined financial law experience helping people throughout Washington State, we can resolve problems like:
If Americans choose, they do have the right to represent themselves in court. However, the legal system in general and financial law in particular are intricate and enormously complex. Consequences can be severe for those who make errors or choose poorly. The best resolutions tend to come from those who work with experienced experts, like our bankruptcy lawyers.
This general guidance is true throughout the country, including here in the Pacific Northwest, with its many locales and attractions. The region is, for some, the perfect place to travel, work, and even live. However, like other states in the USA, Washington State enjoys a large amount of autonomy in the administration of regional and local laws. Those coming from different parts of the USA to Washington State can take up residence in many areas, including Richland, the Tri-Cities area, and other parts of Benton County. Like other states in the USA, living in Washington State means complying with laws created at federal, state, and municipal government levels. These laws have been created to administrate different aspects of life, such as civil or criminal violations and financial activities. They are also meant to apply not only to people but to organizations as well, such as the banking systems Benton County residents rely on.
Sadly, even with a booming economy and plenty of economic opportunity, Americans are not guaranteed financial success. Either due to economic circumstances or poor decisions, some Richland and Benton County residents may find themselves with debts they can no longer manage, making them subject to state and federal laws. People in this situation should educate themselves on the basics of bankruptcy. Then, depending on the situation, it may be time to seek out an experienced bankruptcy attorney in Richland and consider filing for bankruptcy.
Who Should Consider Bankruptcy?It’s understandable that considering the bankruptcy process's reputation, no one considers it something to look forward to. On the other hand, while it is true that bankruptcy is not a positive experience, it’s an error to consider it a “terminal” financial condition from which no one ever comes back. Often, the goal of a bankruptcy filing is the opposite, aiming at eventual economic recovery.
Bankruptcy provides legal responsibilities and protections to the recipients to allow for a financial environment in which debt can be managed and paid. Laws are in place at the federal level to regulate bankruptcy and, to a degree, can be viewed as overarching guidelines. This is because the states have a high degree of autonomy in creating bankruptcy policies at the state level. This allows states to formulate policies relevant to their regional needs and interests. Washington State is no exception to this, as it has written laws and regulations overseeing how Richland, the tri-cities, and others in Benton County file under the bankruptcy process.
One thing people should know about bankruptcy is that it is a general financial status, but within it are specific categories suitable for different parties and their debts. There are general characteristics that apply to all bankruptcy cases, like having debt that the person filing can no longer manage. However, the nature of the debt will have its own unique circumstances and economic factors. A Richland bankruptcy attorney in Benton County can help people navigate the bankruptcy filing experience and determine which type, or “Chapter” is the best for them, such as:
Chapter 13 BankruptcyIn the world of finance, Chapter 13 bankruptcy has earned the nickname “the wage earner’s plan.” This category of bankruptcy filing requires the person filing to have specific characteristics, one of which is the presence of a steady source of income. A common example of this is someone with full-time employment who is still drawing in a monthly salary. Because people who file for this type of bankruptcy still have the safety net of a salary, Chapter 13 filings are often regarded as a less severe category.
Chapter 13 bankruptcy handles debt management by providing some financial structure and planning for the recipient. This is essentially a payment schedule, with installments usually set for a duration between three and five years. Many people will be familiar with this type of planned payment system through other experiences, such as monthly installments on a car loan or the payments on a mortgage. The amount of an installment varies from person to person based on factors like total income, living expenses, and other considerations.
There are two primary requirements to qualify for Chapter 13 bankruptcy. The first is that the person filing must be able to present some verifiable proof of gainful employment, with salary or another reliable revenue stream. The other is that bankruptcy maximums are comparatively small. Only a person with a debt of less than 2.75 million is eligible to file for this type of bankruptcy. People who owe more are automatically disqualified.
Chapter 7 BankruptcyChapter 7 bankruptcy is widely regarded as a more serious category for people and businesses that can’t manage their debt. The process here is simple but may feel drastic to some, as it involves liquidating assets to recover any cash and then applying these profits to the remaining debt. Many regard Chapter 7 bankruptcy as the less appealing alternative, but they may have little recourse if they can’t qualify for a Chapter 13 filing.
The Chapter 7 bankruptcy process first goes through an assessment phase. People filing for Chapter 7 will have any legally owned assets evaluated for cash value. Items that themselves are subject to debt or payment plans, like a home with mortgage payments remaining, are excluded from this assessment. Other owned items, however, like vehicles, paid for and owned property, furniture, office equipment, and even liquid assets, like investments and bonds, may be sold off.
RepossessionsFor the majority of Americans, there are a few high-value purchases where it’s only reasonable, or sometimes even possible, to pay for the item in a single, lump sum cash payment. Fortunately, payment plans with installments are often available for many of these larger purchases, which makes it possible to pay small amounts at regular intervals. However, should a purchaser fail to meet this commitment of paying the installments, then the holder of the debt has legal authority to take the item back. This is a process called repossession. There are specific repossession regulations in place that have distinct categories and rules regarding how to administrate each.
Once an item is declared eligible for repossession, the holder of the debt does not require the consent of the owner to take it back, such as towing away a car behind on payments. However, Benton County residents still have consumer rights that must be respected. Bankruptcy lawyers in Richland may even be able to secure an exemption on some items through specific bankruptcy filings. One example is having an automobile excluded from repossession if it is crucial to maintaining a reliable income that would pay off debts.
Home ForeclosureRepossession is the general practice of seizure on items for outstanding debt. Foreclosure, however, is the more specific repossession of residential property. This occurs when homeowners fall behind on mortgage payments, and the holder of the debt, usually a bank, takes action to recoup these losses. Washington State has its own regional laws and regulations to regulate home foreclosures in Richland and other parts of Benton County. Residents must be aware that once the foreclosure process is approved, they can be evicted from their homes as they are put up for sale, and the proceeds are set to recover what remains of the mortgage debt.
Homeowners facing foreclosure should quickly educate themselves on the process. This will give homeowners a better understanding of what to expect and, perhaps just as importantly, where the boundaries lie. For example, one late payment will not provoke a bank into foreclosing on a home, but if no mortgage payment happens after 120 days, that’s when they can seek and retain the legal power to foreclose and repossess a home.
Wage GarnishmentThere are times when a solution to one problem can create new problems. Richland and other tri-cities residents may encounter this if they face a wage garnishment court order. Wage garnishment is legally imposed “partition” on a person’s salary. The most common example of this is if a spouse, after a divorce, is required to pay child support and then fails to do so. After too many missed payments, part of their wage is “garnished,” which means that it is automatically held back and diverted to recover the debt.
Richland residents do still have some legal protections, as wage garnishment is not unlimited in its legal powers. Washington State has regulations to define the maximums for wage garnishment and even has provisions to declare exemptions. Under current state laws, wage garnishing can only seize up to 25% of a person’s weekly income. The amounts determined for garnishment are based on an assessment of multiple economic factors. Total salary, living expenses, and other debt commitments, such as mortgage or car loans, are all considered. A Washington State bankruptcy attorney may use these factors to mitigate garnishing amounts.
Medical BillsAmericans are fortunate to potentially have access to the most advanced medical treatments in the world. However, that medical treatment can come at a high price. For people without strong health insurance coverage from an employer, one serious accident may be all it takes to wipe out accumulated life savings. Things can become even worse if a diagnosis of an ongoing disease occurs. Worst of all, however, is when the costs associated with these treatments suddenly include additional expenses that were never mentioned before.
Richland bankruptcy lawyers can provide much-needed intervention during such a crisis. Washington State has put laws in place to protect residents from surprise billing. Never assume that just because a bill came from a licensed medical practice, that doesn’t mean it can’t be legally challenged or that there was no unethical attempt to exploit a patient.
Credit Card DebtMany residents of Richland, the tri-cities, and elsewhere in Benton County use credit cards. They’re convenient and one of the best ways to make online purchases. Unfortunately, that same ease of use can sometimes lead to abuse and an escalation of debt that can no longer be managed. In fact, severe credit card debt is a growing problem throughout the United States, and Washington State is no exception.
Ordinarily, handling credit card debt means being proactive and maybe even taking advantage of outside assistance. Washington State has services available to provide credit reports, debt counseling, and other services. In the event that things do escalate to a situation where debt is too large and payments are missed, credit card companies are then empowered to act. They can do everything from gently trying to secure the latest minimum payment on a card to trying to extract funds to pay off the entire debt. Bankruptcy lawyers in Richland and Benton County can intervene to help people get a better resolution.
Creditor HarassmentFinance laws in Washington State govern both people and organizations, like businesses or other economic groups. In organizational situations, they have consumer lending laws they are expected to follow. These laws outline how banks, other loan organizations, and their representatives, such as collection agents, are permitted to act. The laws that regulate these behavioral practices exist at both the Federal and state levels. Sadly, these laws are necessary because some creditors or agents break the law and rely on debtors' ignorance. Some try to exploit debtors' naturally disadvantaged situation, hoping they will assume that if a collection agent does something to them, it must be legal, and they won’t question the action.
Just because a Richland resident is in debt doesn’t mean their rights can be ignored. So, in the event that a collection agent tries to visit a debtor at work, but that workplace has a no-visitors policy, the agent can’t just ignore that because of a debt. In a similar vein, collection agencies can’t call a person extremely late in the evening or early in the morning as an intimidation or disorientation tactic. If any resident of Richland, the tri-cities, or other parts of Benton County feels that a collection agent or agency has crossed the line into harassing behavior, this is a violation of your rights, and you should get counsel from a Richland bankruptcy lawyer to have the behavior addressed.
LawsuitsIn a normal legal situation where someone finds themselves defending against litigation, the best advice is usually to start working with an experienced litigation attorney in Richland, the tri-cities, or other parts of Benton County. There are, however, specific circumstances, especially when there’s no injury liability or defamation involved, where debt is central to the dispute, and it makes more sense to work with a finance expert.
A situation where this often happens is with credit card companies. A person using a credit card may fall behind on payments or even stop paying altogether. The credit card company may first attempt to contact the person and work things out privately. If that doesn’t work, they may try using a collection agency. If that still doesn’t get results, a final resort may be moving to a lawsuit and serving the debtor with a litigation notice to force a court order to seize their assets. However, people in this situation have the same legal options available as those facing a typical lawsuit. The only difference is that it may be better to work with a bankruptcy attorney in Richland to work toward a resolution.
Payday & Money Tree LoansMost people thinking about getting a loan will go to a bank, but there are legal and licensed alternatives to banks. Aside from credit unions, there are financial services companies, like Moneytree, that offer loans as well. The difference is that these loans may have easier and faster approval rates. In some cases, the loans are given on the understanding that this is an “advance” on a paycheck and that the loan will be paid back when the actual salary arrives, hence, “Payday” or “money tree” loans.
People should be aware of the downsides, which only make themselves known in the event a person makes a mistake. While loans are fast and easy to get, penalties can be extremely harsh for people who pay late or miss payments entirely. Spikes in interest rates, late fees, and other punitive expenses can all cause the debt to skyrocket far in excess of what the original loan was. Anyone who gets caught up in this spiral and can no longer manage it should seek help from an experienced Richland bankruptcy attorney in Benton County.