Daily Archives: July 31, 2015

Pesky Debts – Things to Consider

Like all things in life some debts are worse than others.  Many of us have heard that terminology before, one debt is better than another.  I want to devote some time to what I believe is the most difficult debts to get rid of.

The first one is the elusive timeshare.  Many of us may recall being invited to a free seminar, hotel room stay in Las Vegas, or enticed to come to a presentation in exchange for some kind of free gift.  As the saying goes, there are no free lunches in America.  What these generous sales people really want is for you to sign up for a time share.

A time share is essentially the right to use a vacation property or resort for a certain period of time.  Some are based on points.  So many points gets you certain locations, times, and perks.  Others are deeds where hundreds of people all own a small piece of some vacation property and each is allotted a certain amount of time to use the property.  What many consumers don’t realize is that not only does this time share cost money, some reaching upwards of $25,000.00; they also come with pesky maintenance dues that can range in the hundreds or even thousands of dollars per year.  So as long as you are an owner of a time share you will pay that maintenance fee for the rest of your life.  Many consumers don’t realize that while the time share may be nice on paper and comes with many destinations and room qualities, for the price of the time share and maintenance fees I bet a good travel agent or just hunting online can land you an equally nice vacation and hotel room for the same price or less, but on your own schedule.  If you find yourself trapped in a time share and want out, a bankruptcy can certainly get you out of the main debt.  However, until the time share deed or ownership is returned to the company the debtor remains liable for the maintenance dues.

My next topic concerns pesky secured debts for household goods.  For example, have you ever attended a lovely in home presentation where someone offered to sell you a $3,000.00 vacuum cleaner?  Of course, one must wonder why anyone needs such an expensive vacuum cleaner in the first place.  Similar to the vacuum cleaner lots of consumers also get really good store deals at rent to own centers, furniture stores, jewelry stores, and even musical instrument shops.  What most consumers don’t realize that if you fail to make payments on these secured consumer goods, not only will the creditor hound you for the funds, the creditor can even repossess the consumer goods you purchased.  Even under bankruptcy a debtor is forced to either continue making payments or return the items if they want the debt to discharged.  But a bankruptcy filing also allows the consumer to redeem or pay the market value of these consumer goods over a period of time or all at once.  Given the resale value of consumer goods, the amount that actually gets paid back can be quite small compared to what is actually owed or what the consumer good cost new.

Last but not least are student loans.  While these debts are advertised as good debts that invest in our or our children’s future and every payment will help build up your credit score.  While this is all true, when repayment is not possible there is little a bankruptcy filing can do to get rid of the debt.  As a matter of fact the law is so skewed in favor of the government, the holder of the educational note, that you just about have to prove that you are so permanently disabled that you will never be able to use your education to get a full discharge in bankruptcy.  If you are suffering from overwhelming student loan debt, I suggest you still give me a call as there are options we can explore both in and out of bankruptcy to provide short term or long term relief and in some cases even achieve complete forgiveness.  But given the complexity and variety of options that are out there, I strongly urge to come in for a free consultation

For those considering filing for bankruptcy for these debts or any other kind of debt you are welcome to call 916-640-7599 to setup a free consultation.  Likewise if you have questions or comments you can always write me as well at shmorgonlaw@gmail.com.

Finally, I just want to remind my current clients, former clients, and perspective clients that as of July 2015 our office moved to 5015 Madison Ave. Sacramento, CA 95841.  Likewise if enjoy reading these articles and are interested in working and renting space in our building please feel free to contact me as well.  We have just one office out of seven available.  The office is approximately 200 square feet with both a street window view of Madison Ave, and your own private patio outdoor access.  For those interested please don’t hesitate to contact me for a viewing.  The asking price is $600.00 per month and still has that fresh paint remodel smell.