If you, like 10% of the population of the U.S. are unemployed with a family (or even just yourself) to support, you may find it tempting, indeed, to cash out that 401K or IRA fund.

Don’t Do It!

The knowledgeable and experienced bankruptcy attorneys at Legal Helpers want you to know that your 401K or IRA (Individual Retirement Account) has near-absolute protection in a personal bankruptcy. If you are filing for a Chapter 7 or Chapter 13 personal bankruptcy, your qualified retirement plan cannot be seized by creditors! According to Legal Helpers lawyers the worst thing you can do is cash out these plans.

In an article from www.istockanalyst.com, “a Hewitt Associates study shows that 46 percent of workers with 401(k) plans who lost or switched jobs cashed the plans in… that could lead to serious problems when younger generations of people working today reach retirement.”

Although this may, on the surface, seem like an easy way to pay your bills and make ends meet, it is actually financial sabotage. Your creditors and other advisors may encourage you to go down this treacherous path; the only reason they are suggesting this is so they can get paid!

This may seem like a good idea when you do it.  However, what happens when the IRS comes knocking on your door and your credit card bills are due? What happens to your home when you miss a couple of mortgage or rent payments? You won’t be able to sleep nights when the IRS demands it taxes, the credit card companies look for their payment and the mortgage company starts foreclosure proceedings. There go your FICO scores, too.

Before you do anything, please talk to a qualified bankruptcy attorney at Legal Helpers.  Call them now at 800-260-1402. Safeguard your money.

The 135,913 consumer bankruptcies filed in October 2009 represent a 27.9 % increase over the October 2008 monthly total of 106,266, according to the American Bankruptcy Institute (ABI), from the National Bankruptcy Research Center data. The October 2009 consumer filings represent an 8.9 % increase from the September 2009 total of 124,790. Chapter 13 filings comprised 28.5 % of all consumer cases filed during October, a slight increase over the September rate.

According to ABI Executive Director Samuel J. Gerdano, "The nearly 9 % increase in consumer bankruptcy filings in October, together with a 7 % jump reported in business cases, demonstrates the sustained stress on the U.S. economy." ABI forecasts that total bankruptcies this year will exceed 1.4 million, the highest number since 2005.

Could your life improve from filing for consumer bankruptcy? Before you take any action, you owe it to yourself and your family to talk to a qualified bankruptcy attorney at Legal Helpers.  Call them now at 800-260-1402. Improve your personal financial picture; call Legal Helpers today.

Faster-Granted Bankruptcy Stay Could Cross the Pond

There is no shortage of differences between English and American culture. The gap continues to widen regarding both country’s handling of bankruptcy. England and Wales’ Department for Business, Innovation & Skills (BIS) is now cutting down the time it takes to file for bankruptcy by making filings available online. 

Online bankruptcy would only impact the initial filing, making the process exclusively simpler for consumers alone.  Subsequent creditor disputes still have the potential to be drawn out in the traditional bankruptcy court cases.  Additionally, creditors will not be given the equal playing field of filing against the bankruptcy online, which could potentially devastate hurting debtors.

Britain’s move to put bankruptcy filing online has the potential to revolutionize the industry.  Faster bankruptcy filings mean more full-time working debtors can be granted an automatic stay.  Online bankruptcy filing of course does not guarantee a successful exiting of bankruptcy, as debtors’ cases would still be tried and heavily scrutinized by the British court systems’ bankruptcy “deciders”, the equivalent of a U.S. Bankruptcy Judge/trustee.

The U.S. is still a far stretch from a consumer-accessible bankruptcy process.  In 2005, the U.S. famously impeded the path of the bankruptcy process with the Bankruptcy Abuse Prevention (BAPCPA) laws. Prior to an initial filing, an individual in the U.S. must complete a credit counseling session and fill out a means test to determine whether they qualify for the preferred Chapter 7 Bankruptcy.  Regardless of these bankruptcy hurdles, the recession has caused the amount of U.S. bankruptcies to climb to its highest in four years, or their pre-BAPCPA level. 

The implementation of online bankruptcy is still pending approval by February 2010.  If Britain’s small-scale experiment succeeds, the U.S. might just take a cue from their innovation.  While you may not be able to complete an online bankruptcy filing in the U.S., you can still acquire top-notch legal help through the online resources at Legal Helpers.  Our initial consultation is always free—call us toll-free at 1-800-260-1402.