[COLUMN] Seniors need Chapter 7 relief for various unsecured debts of $ 50,000 –


THE client is 72 years old. He still does his normal job and earns around $ 3,000 a month. He also collects Social Security of $ 1,000. So his total income right now is $ 4,000. He tells me he’s tired of working. His wife doesn’t want him to work anymore. His wife retired before him at age 65 and now receives $ 800 from Social Security. She does not work anymore.

I ask him what is the problem? He says they have the following debts:

  1. He owes $ 30,000 in credit cards;
  2. He owes $ 10,000 in car pension deficiency;
  3. His wife owes $ 12,000 in credit cards.

The minimum payment on his credit cards is $ 1,000 per month. The minimum payment on a woman’s credit cards is $ 400 per month. Minimum total household credit card payment is $ 1,400 per month. The net household income is $ 4,400 per month. They don’t own a house. They rent $ 1200 a month, just a one bedroom apartment. Utilities and food cost around $ 700. They have a 2013 Lexus 250 IS which is fully paid. They only have one car. They had a new SUV but it was taken over last year, hence the $ 10,000 pension deficit. Auto insurance is $ 120 and gasoline and car maintenance are $ 400. Cable TV and cell phone cost $ 200. They contribute $ 100 to their church. They send $ 1000 per month for the medical expenses of their adult son who lives abroad. He has no medical insurance and suffers from T 2 diabetes. His illness recently took a turn for the worse. Although he is only 45 years old, he now has to undergo dialysis 3 times a week. And, last month, her foot was amputated due to gangrene from an injury that was not healing. He accidentally cut himself while cleaning his garden. He stepped on a nail that went through his thong. The nail was rusty and made a nasty wound on the soles of his feet.

The wound was infected with MRSA, a type of bacteria that does not respond to antibiotics. The wound and infection filled with pus, then it became gangrene. Time for panic. Doctors suggested amputating her foot to save her leg. Is there a choice? What a difficult position. Lose your foot to save your leg.

So with the $ 1,000 they send to their son, their total monthly expenses for necessities are $ 3,800 compared to their household net income of $ 4,400. As a result, they still have $ 600 more per month BEFORE they make the minimum credit card payment of $ 1,400.

Well, at this point they’re missing $ 800 because they need $ 1400 for minimum card payments, but they only have $ 600 left. And who knows, their son may need over $ 1,000 a month for medical bills with his rapidly deteriorating health. We pray to our Almighty God through his Son, Jesus Christ, we never face this kind of sad situation. Imagine that your son or daughter had to choose with amputation of the foot to save a leg and be on dialysis. It’s too much to bear. You would probably cry with all your heart every day.

I refer you to Psalm 91: The one who goes to the Lord for safety, the one who remains under the protection of the Almighty, can say to him: “You are my defender and my protector. You are my God; In you I trust… When they call me, I will answer them; When they get into trouble, I’ll be with them. I will save them and honor them. I will reward them with a long life; I will save them.

Obviously, something else will now have to be cut. Credit cards must be cut to free them from having to pay $ 1,400 per month. Either way, they’ve paid that minimum of $ 1,400 over the past 10 years. They have paid a total of $ 168,000 over the past 10 years to keep $ 42,000 in credit cards up to date. So why do they still owe the same $ 42,000 in credit cards today? Because that’s how it works. It’s a good deal for mastercard and visa, but it’s totally SUX for customers. If they had wiped out those cards with Chapter 7 ten years ago, not only would they owe $ 42,000 in cards today, but they would have at least $ 250,000 in savings that would give them an extra income of, say , 7%, which would give them an income of $ 17,500. per year, or $ 1,500 per month, which they can use to travel the world, or just reinvest the income.

I forgot to ask if their son has any children. If he does, clients may need to help their daughter-in-law care for their grandchildren if their son dies. It would certainly help to have $ 1,500 more per month to look after their grandchildren overseas. $ 1,500 per month abroad in a third world country goes a long way in supporting their grandchildren overseas. Their son will appreciate it very much since he will no longer be able to take care of his children.

Here are the other issues that customers face. He’s about to quit his usual job, which earns him $ 3,000 gross per month. You don’t have to be an accounting expert to understand what losing that income will mean. There simply won’t be any money available to make the minimum payment of $ 1,400 per month to keep $ 42,000 credit cards up to date. No way, just, no way. It’s time to get rid of the $ 42,000 with a Chapter 7 erase. I should have done this ten years ago. Now customers really have to deposit to get rid of the $ 42,000. It is as if the foot has to be cut to save the leg. That’s life. I therefore refer you again to Psalm 91 because this Psalm was written by Moses who is much loved by our God. It therefore has a lot of weight and truth.

If you need debt relief, please make an appointment to see me. I will analyze your case personally.

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Disclaimer: None of the above is considered legal advice to anyone. There is absolutely no attorney-client relationship established while reading this article.

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Lawrence Bautista Yang specializes in bankruptcy, business, real estate and civil litigation and has successfully represented more than five thousand clients in California. Please call Angie, Barbara or Jess at (626) 284-1142 for an appointment at 20274 Carrey Road, Walnut, CA 91789 or 1000 S. Fremont Ave., Mailstop 58, Building A-10 South Suite 10042, Alhambra, CA 91803.

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