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2021 COVID Pandemic Stimulus and Debt Resolution

Welcome everyone.

I wanted to start out today by introducing myself. I’m attorney Charles and I am a bankruptcy and real estate attorney in Allentown, Pennsylvania. And with me today, I have attorney Sam Wright and attorney Brent Westbrook, go ahead, please. And introduce yourself and tell us a little bit about where you are and what your firm does.

Sure. So I’m saying I’m right. And I’m on one of the co-owners of a law firm’s farmer in, right. And we’ve got offices from Louisville, Kentucky all the way West over to the new Kentucky. We handle things like, bankruptcy work and other issues related to debt.

Very well thank you very much. And, Brent, tell us about yourself,

Yeah. Hi everyone. So I am Brent Westbrook. I’m a bankruptcy lawyer here in St. Charles, Missouri. We are a suburb of St. Louis, just West of St. Louis, Missouri. We handle cases all over the Eastern half of Missouri and Columbia and Jeff city in the middle district there as well.

Oh, that’s great. It sounds like both of you guys have some good reach in, in the States in which you practice. That’s wonderful. Well, so listen, we, we decided to get together today to talk a little bit about debt during the pandemic and how to protect your stimulus check and your tax refund from your creditors and how to protect your property. Right so a lot of folks have seen some hard times in the last year as a result of the COVID pandemic. And, there’s been some great stimulus money out there to help people along who have lost their jobs and who have fallen upon, these tough financial times, whether they got sick or they got laid off their business closed. You know, we’ve got a lot of gig workers out there, people like yoga instructors and fitness instructors and, you know, bands, things like that, where they just couldn’t do any work for a while.

So, you know, we wanted to get together and talk about what this means for everyone, what this means for the economy and how you can really protect yourself. So, the first thing I want to ask you, gentlemen, about is this new stimulus package. So we’re, we’re very timely with this. Some of the checks are hitting people’s accounts as we speak. And it’s my understanding under the new stimulus bill, that a lot of folks are going to get some pretty sizable checks. So, Sam or Brentwood, one of you want to want to talk about who’s going to get money and how much they can expect to receive.

yeah, sure. I’ll, I’ll hit that. So, folks who qualify should get $1,400 per person, they also get $1,400 per child or adult dependent. So this can be life changing for a lot of folks out there. And so a lot of folks who are struggling with that, it’s, it’s quite a bit of money for them to have and it’s much needed. So it’s a wonderful, wonderful thing now there’s some caveats to that. And part of the reason why we want to talk to boats is that money could be taken from you. And so Brent let’s have you addressed, the issues related to folks taking that money from much needed, individuals.

So the interesting thing about this, stimulus package, which is different from the prior stimulus packages is that it’s not exempt from your creditors. So, creditors can attach this money if it’s sitting in your bank account, they can get to that. It’s not exempt. And the interesting thing here is that if you do need to look at bankruptcy as an option, it’s not property of your bankruptcy estate. Okay. So it can be better protected in a bankruptcy oddly, then outside of a bankruptcy. So, yeah, it, it’s not exempt. Creditors can get to that, which is different than the prior packages. But, the nice thing is, is that it’s not property of your bankruptcy state. Interesting.

I was going to say, Charles, why don’t you, you know, you could talk about issues related to, if there’s a levy on somebody’s bank account and the ability to file the bankruptcy, get rid of the levy. And yeah,

Absolutely. That, that’s one of the things that I was thinking about when you said that brand is, you know, this, this really differs from the last stimulus package, because this is a check. This is money deposited in your bank account, that if your creditors were to levy on your bank account, they’re entitled to take this money in the last stimulus package. That money was not permitted to be levied upon by creditors. So if you owe a debt to discover card or American express or anyone for that matter, and they have a levy on your bank account, you would still get to keep that 1400. And another interesting thing about this is for example, social security is one of those types of income that is always exempt from a creditor levy. If it’s kept separate from your other money, once you co-mingled social security funds with other funds that all gets mixed up and then a creditor can levy on it.

So one of the things that concerns me is I’ve got a lot of folks that I’ve met that live on social security only, and they feel like they’re in power because the creditors can’t take it. And the issue is this check of stimulus money is going to get deposited in the same bank account as your social security check. And now you’ve co-mingled funds and your creditors will be able to levy those accounts. So it’s really something that you’ve got to watch out for it. If you felt untouchable in the past as a result of only living on social security, this is a way that the creditors may be able to get your money. If they Sue you and go through the collection process.

Right. It

Does it just direct. It can expose that money that otherwise would be protected, to collection from creditors. That’s right. so, you know, it’s best to take steps, talk to a lawyer if you’re, if you’re worried about that and find out what you can do to, to try to protect that for yourself and your family.

Yeah. Cause I know in Kentucky, so there are our, you know, clients have the potential to have $10,000 for example, and I’m using this as an example, it depends on the situation. They can have $10,000 in the bank. They can file bankruptcy, get rid of all of their other debt that qualifies for discharge and keep the $10,000. Right. so it should really be, so not only is this going to put folks in a great position because we’re going to have cash in the bank, they could also have cash in the bank and no debt.

Yeah, that’s exactly right. And as Brent was saying, this is not part of the bankruptcy estate. So an argument could potentially be made that they could have even more than $10,000 in the account if they had 10,000 of their own money and then got, for example, a $7,000 stimulus check, I could see where an argument could be made, that they could really get off in the right foot by clearing up all their debt through a bankruptcy, or maybe settling some debts. You know, if there’s a reason not to file bankruptcy and still keep a substantial amount of money in the bank to restructure and move forward. So that’s a very good point.

Hey Charles, I got, before we move on to the moratorium on foreclosures and things, I’ve got a question about, that maybe somebody can address on if folks try to take like their stimulus money and they want to try to resolve some of their debts. So we might want to explain to folks, the pros and the cons, because I’ve had some discussion with clients who do want to do that. And I give them the pros and the cons, related to those kinds of situations.

Absolutely. Sam, why don’t you talk about that a little bit more Cause I mentioned, you know, resolving a debt outside of bankruptcy through settlement. So I know that that sparked that in your brain. Why don’t you explain the, the pros and cons of doing it one way versus the other

Yeah. So we have clients who will come to us and they’ll have, they’ll have debt that they want. Like most of my clients, they want to try to repay their debt. But many, many times they’ve tried in the camp, right So we’ve got to do something to help them. But for those folks who want to try to manage their debt and resolve it on their own, there’s a couple of things they need to think about. Number one, if you’ve got, let’s say seven credit cards, right Or seven credit accounts, and you want to try to resolve those. you gotta be certain that you’re going to be able to resolve all seven of them because what I’ve seen in the past is I’ve seen clients they’ll have four nice creditors, right Four nice credit card companies who will, who will write off some of that debt.

They’ll give them a deal. And my clients can pay that off. The bad news is the client still has four credit cards with high balances. They’re still making those monthly payments. And ultimately they got rid of a bunch of their cash and they didn’t resolve their debt issue. Right. So number one is you gotta be careful about not resolving all of your debt. You may have heard some thunder in the background at storming and Kentucky. So the next thing that folks need to remember about trying to resolve the debts on their own, if a creditor write off your debt. So if you owe $10,000 and they say, you can pay him 6,000 and they’ll call it, even the creditor has a right to send you a 10 99 C at the end of the year. And you have to treat that as income if the creditor writes it off. So a lot of my clients don’t realize this when they work with credit consolidation companies or debt consolidation companies, because the next year, by the time this is all done surprise, they get a 10 99 C in the mail. and that you have to treat that as income,

Right And that can trigger tax consequences depending upon your tax bracket. You know, if you get rid of 4,000, if there’s 4,000 that you don’t repay, that could be, you know, a thousand or $1,500 worth of more money that you owe the IRS.

Yeah. And then the final thing that I tell folks about trying to resolve debt, that creditors don’t have to take a haircut because, so just because if you own $10,000 and you say I’m getting ready to send you $7,000, they don’t have to agree to that. And I think, I think that creditors know what’s going on in the market right now, creditors know that folks are getting these stimulus checks. Folks are getting tax refunds and they know they may not have to deal with you. Right. So they might not have to give you a good deal. So those are my thoughts on trying to resolve it on your own. You guys may want to add some things if you want.

Yeah. I saw Brent and I were shaking our heads here in agreement. I think we’ve all had these experiences. Brent, go ahead and see if there’s anything you have to add. Yeah.

Yeah. I think that’s it. And you know, if you’re doing a debt settlement, you really have to get all the stars to align at the same time and make sure that you get rid of your problem. Otherwise you’re just kicking the can down the road and you’re going to have less cash to deal with it later. So, you know, you want to make sure that you can, you know, bring these to a settlement quickly. if that’s the direction that you want to go and settle all of them, otherwise you’re, you’re really putting yourself in a worse position.

I completely agree. And, just to echo what Sam said, most of my clients feel terrible about not repaying their debt and they want to repay their debts. And that’s what makes debt consolidation so attractive. Also the advertising behind the debt consolidation companies, the advertising dollars really pushing that as the perfect solution is a lot to, to overcome. But the big thing that you need to know about this, and I’ve seen this so many times in the 20 years I’ve been doing this debt consolidation works in a very limited situation. So I’m not here trying to say that it’s a scam. What I’m saying is it sounds too good to be true. And for most people it is because they start you out with a low payment and they tell you the negotiated with all your creditors. But as Sam was saying before, the creditors don’t have to accept it.

So what I see a lot of times are somebody goes into debt consolidation with eight creditors. Everything’s fine. They’re paying in for two years. And the consolidation companies making minimum payments and they’re seasoning the debt for settlement. And then when they go to settle, a couple of them will and a couple of them won’t. And then the consolidation company calls you up and says, listen, we know we told you $400 a month, but now we need 800. And if you can do 800, we can keep working on this. But if you can’t do 800, Oh, guess what You’re getting sued by these creditors, that won’t cooperate. So a lot of people come to me after, unfortunately they’ve been in these plans for two years, made their credit worse, and then we can still clean everything up. But it’s just disappointing, you know, having had that situation and tried so hard.

Yeah. How many of you have had clients come to you who got served with a lawsuit at the same time They thought that the debt consolidation company was helping them work out at deal all the time. Yeah. Thousands. Yeah.

Hundreds, hundreds and hundreds of times. Okay, great. Well, thank you very much for talking about that. Let’s just talk really quickly about the unemployment, because a lot of folks are going to see an increase in unemployment. You know, last summer when that first stimulus check came out in 2020, we had the extra $600 a week. That was about $2,500 a month for most people on top of their regular unemployment. And that’s what really kept the economy going strong all summer. So what we’re seeing in the second stimulus stimulus bill is we’re seeing $300 a month. So half as much as before, but still about $300 a week, about $1,400 or so a month, because there’s more than four weeks in a month. So it’s about $1,400 a month that people are going to be getting until the end of this summer, if they’re still on unemployment or for those gig workers. And that can be really beneficial. But at some point, this has to come to an end. So I wanted to talk about, with both of you and, and I’ll pass it to you first this time. tell me, do you think folks are going to use this, this money to pay their creditors Or do you think that now’s the time to file bankruptcy What should people be doing

I think it just depends on everyone’s situation. You know, first and foremost, I think people need to be taking care of basic needs, food, you know, feeding their families and basic needs. then, you know, if, if the unemployment, or these stimulus payments are enough to settle all of your debts, then maybe that is an option, for you. but if not, you know, I think it makes sense to consider bankruptcy as an option just to get a fresh in the future

And use this money to set your family up, in the future when these benefits run out, unfortunately, and like Charles said, you know, there’s been some great help for people, when this pandemic hit, but we all know that at some point, this is coming to an end. So we’ve got to think long-term here and what the long game is. And I think considering bankruptcy and getting a fresh start, so you really can move on is something that, that a lot of people should consider as a good option for them and their family.

So then what are your thoughts I agree, a hundred percent. What are your thoughts

So I’m in Kentucky on the unemployment issue there. At this point, you can get 13, additional weeks of unemployment. so there’s just a little nugget relating to Kentucky. so if you’re, if you’re on unemployment, continue to call in, continue to report that you’ve not been able to secure employment and take advantage of the benefits. Okay. So I tell everybody take advantage of the benefits. If you, in Kentucky, if you get another job and you’re making less than what you were making before, check when your unemployment rep, but, you have an opportunity to get unemployment on the difference of how much you used to get paid and what you’re getting paid now. And you need to take advantage of the benefits. And I want to echo what Brent said, all good things must come to an end. So these benefits that we’re getting, that, that folks in real need, aren’t forgetting and can take advantage of they’re going to end. Okay. So you got to plan and set yourself up for success. Missouri was a little longer 26 weeks, but it’s still, like you said, it’s all good things, unfortunately come tonight.

Yeah. And I just want to touch on one more thing that Sam had mentioned. I believe that that, shortened employment or the less income employment, like you were making the job, you, you’re making $30,000 before now you got a new job and you’re making 20,000. So you think you should come off employment, you know, in the past that difference has always been there, but it’s been negligible. So a lot of people felt well, you know, I’m not going to file for unemployment because they’re going to give me an extra $37 a week. Well guess what, right now with this federal stimulus that $37 a week turns into $337 a week. So if you’re eligible for $1 of unemployment a week, because you are now employed at a level lower than before, you’re actually going to get $301

A week. So

The only other thing I wanted to add with that is, I don’t know. And, and I know that you don’t either, because if we could predict the future, then we probably wouldn’t be doing this for a living. But, I don’t know whether the economy is going to get stronger or weaker as a result of this stimulus there’s debates on both sides. So now, if this is giving an opportunity to get a little bit of extra money, I just wanted to mention that now is probably a really good time to deal with this debt because whether the economy, if the economy gets stronger in the fall, great, you’d rather be starting from zero and being catapulted into an improving economy in the fall. And if it’s going to get worse, you’d rather take care of your debts now, so that you’re at zero in the fall, and you can maintain that way and build positive.

Charles, let me ask you a question. You guys might want to weigh in on this. So, if I’ve got, this, is this topic relates to home buying and bankruptcy. Okay. Because here’s, what’s going on. I’ve talked to clients about it. My clients tell me I’ve got three kids under the age of six. Okay. We’re going to get a stimulus check for my wife and I, and our three kids. We’re going to have a lot of money. We want to use that as a down payment on a house. So how can I buy a house and still file bankruptcy Because we’ve talked about bankruptcy a little bit in here, in addition to otherwise, to deal with these debts. somebody has got, you know, $15,000 of cash in the bank. The most that ever had that want to use that for a down payment on a house. What are your all thoughts on the interplay between using that for a down payment on a house and potential debt relief through bankruptcy For example,

Brandon, I’ll pass it to you first. Let me, what are your thoughts

Well, I think that, you know, you can, put that down payment down on a house. You know, if you’re looking at bankruptcy as an option, the general idea in a chapter seven bankruptcy, which is the most common case it gets filed by consumers is that you’re trading your property to get, get out of your debt in general. Now we can protect a certain amount of property for you in a bankruptcy and the laws that control that are called exemptions. Okay. So the exemptions govern what you can keep as you go through the process. and if you’re putting a down payment on a house that is less than the exemption amount in your state, you can protect that home. so that is a great opportunity to have a chunk of money and buy a property, and protect that property even in a bankruptcy case. generally. So, that can be a great option.

Yeah. I actually agree with you, Brent. I think that that’s a fantastic option, but we have to be careful about how we do it, right So, so let’s say you have $15,000 and you want to buy $150,000 house. I don’t know what the median household purchase is, where you guys are, but for us, it’s around 200 in the Lehigh Valley here, but I think across the state of Pennsylvania, it’s a little less than that. but the, the idea is if you have $15,000 to put down, that’s fantastic. That’s going to cover your closing costs. It’s going to get your escrow money in. And the problem that I think a lot of folks are going to run into though, is if they’re struggling already, they may have an issue getting a, for the other 90 or 125 or 150,000, because if their credit scores are below six 50, and I’ve heard of people getting loans with credit score below six 20 for a house, but generally speaking, the loan brokers tell me, you need to be above six 50 and you need to have your collections cleared and you can’t be in default.

So there are not a lot of folks that are married with three kids who are excited to get this $15,000 that are going to fall into that credit profile. So, you know, one of the things that we were talking about earlier is the fact that in, in our various States, you can protect somewhere between 10 and $15,000 in regular cash. And as a result of the stimulus money not being considered property of the bankruptcy estate may be more than that. So, I don’t know, I don’t know nationally, but I can tell you that in Pennsylvania, if you can buy a home before bankruptcy, I think you should absolutely do that in, in your, in this type of situation. If you can’t, what I would encourage you to do is to save that money file bankruptcy, and then rebuild your credit. I I’ll let you guys speak to this, but I’ve seen clients that have gotten their credit scores back up over 700 within 18 months. And they’re coming back to me for me to help them buy a house two or three years

Down the road. Yeah. So what the, the important thing is there may be some really great options for somebody who wants to deal with debt and wants to buy a house. Okay. So contact a lawyer who deals in these things. We deal with it all day and all night of our working lives, but contact a lawyer who deals with this kind of stuff that can help you. I also know, I know you guys, we do this at our firm. So we offer some solutions and probably even credit score back up after bankruptcy, we do it at our office. I know Brent does it in the St Charles Missouri area. And in Charles, you do it in the Lehigh Valley. So, we’ve got, we’ve got, have some other solutions for folks who ultimately do file bankruptcy and they want to get their credit score back up, which is, I think, different than some other firms.

Absolutely. I completely agree with that. It’s different than a lot of firms. And the only plus one I wanted to add is you really need to talk to a local attorney. If you want to do this type of financial planning, you want to talk to an attorney that knows about credit debt, bankruptcy, real estate, and how all of those things interplay. And when we say at least here in my office, and I believe it’s the same for the two of you. When we say that we offer a free consultation with no strings attached, we absolutely mean that it’s a hundred percent free consultation. You come in, ask questions, know your rights, get to know what your options are, and then make a decision. You know, the only catch to a free consultation with my office is we might follow up with you again afterwards through some email or a phone call to check on you. But other than that, it’s an absolutely no obligation consultation. We’re not gonna, you know, pull any money out of your pockets. We’re just gonna tell you what you want to know.

Yep. Same. Yeah. Same in our forum. Okay.

Okay. Let’s talk. let’s, let’s move on to another topic. we’re, we’re getting close on time, but we want to talk a little bit about forbearance and moratoriums. So let’s go to forbearance first and I would like a one of you two, and you can decide who goes first. I’d like one of the, two of you to explain what a forbearance is about a year ago, a lot of mortgage companies said you can go into forbearance. And what does that mean And how do you get out of forbearance

I can, yeah, I can talk about that. So the forbearance is really just simply an arrangement where your mortgage servicer elects not to take negative action against you during a certain period of time. So they’re not, you know, most of these forbearances are six months, right They’re not going to report negatively to your credit. If you’re not making payments, they’re not going to take collection attempts. They’re not going to foreclose on you. but one thing that it isn’t is a forgiveness of those payments. So I think a lot of times, consumers here for barons, and they may think that the payments are going away, or that they permanently don’t have to, to make those payments. This is just simply an arrangement where they’re not going to take any negative action against you for that period. And those payments are still due. So what we want you to do is make sure that you’re coming up with a plan consulting, a lawyer, and you’ve got a way to deal with those missed payments. I mean, we’re seeing people that are six months, even a year in with miss payments and still of course, want to keep their family in their home. So, you know, you want to be, talking to an attorney, to make sure that you can keep the, the property. You could also, you know, reach out to the mortgage company to see if they’ll allow you to do a loan modification, to put those on the back end. but you want to deal with that permanently and not have that lingering out there.

Wonderful. And, Sam, I’ll go to you in one second, but that’s a, that’s a very good point that you brought up. Brandon. I want to ask Sam about this, Sam, how do you get out of forbearance and how do you know when you agree to, you know, when you call the bank and you say, I can’t make the payment this month and they say, it’s okay, we’ll put you in a six month forbearance. You know, what’s the end result of that How can, how do you get back on track

Yeah. So there’s a couple things, on, it depends on the agreement that you reach with a bank, right And typically, I have seen it where the bank doesn’t, they don’t typically call you and say, Hey, I’m just wanting to let you know, you have to start making your payment today. Today should do that. What I typically see is folks get out of forbearance. They think they’re still in, they don’t make the payment they get behind. Right. but, and I want to talk about that solution just a minute, but the other issue is there are some or Baird’s agreements where they tack it on at the end of the right.

And here’s what I need folks to understand, right. That they can kick the can down the road and that immediately takes pressure off. Right. So if you’re in food service or childcare and you hadn’t been working because of the COVID pandemic, you’re thinking, okay, I can breathe now because I don’t have to make these, these mortgage payments it’s still owed at the end. And the other thing you got to realize is that some of these banks are able to charge additional fees for going into forbearance and allowing that to happen. Okay. So, so that’s something that you’ll be facing down the road. The other thing you got to realize is you hear on the news and you read on the internet about all these banks, you know, telling everybody, you don’t have to make a payment right now, everybody’s in forbearance. If you don’t have a deal with the bank, you, you still have to make the payment.

Right. And so we have clients who come to us and they say, well, heck I’m in food service, or I’ve worked in a factory. And they reduced our hours because of COVID. And we can’t have that many people in the factory. I haven’t been making my house payment, but everybody’s in forbearance. Well, yeah, you’re not in forbearance unless the bank says you are, but okay, there are options that you have. Okay. So there are many cases, where you can call the bank and try to work out a deal with them. Or if the bank won’t deal with you, or if you don’t like the terms that they’re offering, a solution that requires less money each month would be something called a chapter 13 bankruptcy, talk to a bankruptcy attorney about it, but it would give you the opportunity to catch up on your house payments if you weren’t in a forbearance. but you just hadn’t been making the payment.

Right So I’ve seen a couple different forbearing situations early on in the pandemic I saw that people were calling in before everybody knew what a forbearance was and the banks were saying, yeah, you know, we’ll give you a six month forbearance. And some of those folks didn’t have an end deal. So the bank said, you don’t have to pay us for six months, but then guess what In month seven, the bank saying, okay, you now owe me six months of payments at a lump sum. We weren’t, we weren’t giving you these on the end of the loan, or we weren’t restructuring your loan. We were just giving you time to come up with the money. So that’s one type of forbearance. Another type as you suggested, Sam and bran is they will put those payments towards the end of the loan, which extends the loan.

But you’re paying not only are you paying extra fees sometimes, but also the interest, right So you’re still paying. And the majority of a mortgage payment is interest. So, you know, if your mortgage payment is a thousand dollars a month, it might be $800 a month in interest, depending upon where you are. So you’re not only adding time to your mortgage, but you’re adding, 4,800 or $5,000 of interest to that mortgage over time. So if you don’t have a game plan going in as to how you’re going to get out, you don’t know what the bank is.

I agree too. Yeah. And all of those options, you’re at their mercy. Really They really have any leverage. Right. That’s right. Yeah.

Yep. So chapter 13, as Sam said, can be a great option to protect

The property, pay it based on a schedule that you can afford and also eliminate some of your other debt at the same time. Yeah, yeah.

Yeah. It’s a very interesting situation and it’s very complex. So just like both of you said, I would suggest that like we’ve been suggesting about all of these topics. You can get a ton of misinformation on the internet, right It’s like if you Google that your elbow hurts, you’ll find out that you might have brain tumor because that’s the way Google works. It’s the same kind of thing with real estate and finance. And by the way, the reason the three of us are on here is because there are state specific differences. So you could Google something and get the exact answer you’re looking for. But the guy in California wrote it and you’re in Pennsylvania and it doesn’t apply to you. One of those things that I run a class all the time is with Florida. So for example, in protecting your home, there’s an unlimited homestead exemption in Florida. You can have a million dollar house with no debt on it and still file bankruptcy. And guess what In Pennsylvania,

You can’t do that. Right So

All of that misinformation, unless you’re getting it straight from the source, from a local attorney that you can know

And trust. all

Right. One, one other topic I want to get into here is about moratoriums. So we’ve heard this word moratorium of foreclosure being thrown around in the news, and it was put in place at the beginning of the pandemic. And it’s been extended a couple of times. My understanding as I sit here today is that the Fort federal foreclosure moratorium is set to expire at the end of this month on March 31st. Now I know there’s talk about extending it to June and there may actually be something in the works like that with Congress right now. But as I understand it right now, it only extends through the end of March. Sam, can you tell us what a moratorium

Yeah. So moratorium in this instance is either an eviction moratorium or foreclosure moratorium. And that’s where, there have been some guidelines either from the feds or the specific States, indicating that you cannot proceed with a foreclosure action where you cannot proceed with evicting someone from a residential rental unit during this, moratorium. So those are typically in this context, that’s what we’re talking about.

That’s different than for Barron’s right. We’re talking about people that are behind.

Yes. So the, the government’s

Just saying you can’t, you can’t foreclose or evict them and remove them from their home right now.

Right Correct. Right

Down, down where you are. I was speaking with your office and I’ve been told that some of the judges are ignoring the moratorium. We’re at least making people jump through extra hoops to stay in their home. Can you tell me a little bit about what’s going on down there

That’s right. So they are proceeding with the evictions in our area. there are some CDC forms that, you know, people can fill out and request, that the moratorium be record, you know, recognized in their case, but the courts are not providing those. and the judges are going forward with them just like it’s not in place. Have you had the same experience, Sam

Yeah. So in, in Kentucky you can now be evicted for nonpayment of rent and there, the courts will allow a foreclosure action provided it’s not a federal backed, mortgage, right So the, the federal government has said no more tutorials on federally backed mortgages, right. Because they can control that. But, for those that aren’t backed by the feds, those mortgages, you can be foreclosed. and then also tax foreclosures in Kentucky. we were, judicial foreclosure state. So you got to go to court. If you didn’t pay your real estate taxes. And somebody bought that tax bill, that can file a foreclosure action. We can stop it for a bankruptcy. So call a lawyer. but they can do that in Kentucky.

Yeah. And it’s very similar here in Pennsylvania and what we were seeing from the beginning of the pandemic in the beginning of these eviction moratoriums through about October of 2020, when some, when a tenant would get sued, the court would mail with the lawsuit, a copy of the CDC paper, and basically tell them, Hey, if you fill this out, we can’t evict you. What I can tell you now is they’ve stopped that in the store. The courts here in Pennsylvania will still honor the CDC moratorium paperwork, but they’re no longer guiding people to it. They’re no longer providing it to you. You have to bring it yourself, or you have to specifically ask for it and fill out the forms and they will honor it if you do that. But otherwise you’re out. And you’re right. The moratorium that the federal government put on foreclosures is only for federally backed mortgages.

You know, those Fannie Mae’s and Freddie Mac’s those types of mortgages or the USDA loans, but not your conventional, you know, chase bank or Wells Fargo mortgage. Now I’ve seen a lot of those banks following suit and they’re holding off, but there’s nothing that requires them to. Yup. Yup. Very interesting. All right, gentlemen. Well, I think that’s all the topics that we have time for today. I just wanted to close up this, this wonderful conversation and thank you both for joining me this morning, but I want to hear from each of you, we’ve talked a little bit about your practice areas and how you can help people through bankruptcy or through some other means, but I want to know what the process is. So I’ll go first to you, Sam, just because you’re on the top of my screen, I’ll go first to you and ask you, what is the process of interacting with your office and getting the, the advice that people are looking for

Yeah. So, at farmer and right, we able at this point to do everything virtually, so the initial consultation takes place just like this, just like we’re talking. we help folks get the technology set up from their home. We’ll guide you through, on the phone, on how to get zoom set up, for example. So we do a consultation by video. and we also, for example, somebody who needs help with bankruptcy to stop a foreclosure or get rid of credit card debt and keep her stimulus money, we are able to, send forms electronically. We have folks that will go over the forms with you on the phone live and we’ll help you complete them. And then you send the forms back to us electronically. We can get your bankruptcy case signed and filed without you ever having to leave her house. Right. I haven’t had folks who do it at work right on their work, on their breaks, right. Their scheduled breaks. but they don’t have to come into the office anymore. We can do everything just like this. And the good news is, you know, the clients can still see me. I can see the clients because I want to see the relief on their face when we tell them, okay, we’re filing your bankruptcy case. You don’t have to worry about debt anymore. so at our office, you know, from Volvo all the way West to the tip of Western Kentucky, you don’t have to leave your house. Wonderful.

Brent, how about you How can people interact with

You Absolutely. they just need to reach out to our office. We’ll get them set up for a console. we do, you know, consults by zoom by phone. so it doesn’t require an in-person, appointment. And our courts here in Missouri have also relaxed the wet ink signature requirements. So the nice thing is, is, you know, we can prepare documents, virtual fully, you know, have a meeting, make sure everything’s correct, review them with you so that you’re still comfortable with them. and send them to you electronically through email to get your signatures that way, and then get your file. Like Sam said, I mean, we file people, you know, people can file bankruptcy while they’re sitting at home on, you know, on the couch or at work. so that process to get to the courthouse steps and get the financial relief that you need has really become much more manageable during this pandemic. And, you know,

In bankruptcy, there is generally one hearing that everyone must attend called a three 41 meeting of creditors, or are both your jurisdictions doing those virtually as well

Yeah. So in, in Kentucky, in the Western district of Kentucky, everything is done remotely at this point. So if you, if you don’t want to have to go down to the courthouse for an hour or two and sit and wait on your, your turn to be called, right now, if you file, you can do it by telephone or by zoom that’s out. Yeah. Missouri’s the same way we don’t have to drive to downtown St. Louis MindUP spot to park all of those fun things. it’s all by telephone right now in our jurisdiction. So I want you to say, Charles, you have a phenomenal reputation for the bankruptcy work that you do in the Pennsylvania area, where your offices are located. What, how do you handle it right now

We’re doing it very similar to you guys. And thank you for saying that you guys both also have phenomenal reputations in your areas. That’s one of the reasons that we wanted to get together and do this. the way we’re doing it right now is we’ve started practicing bankruptcy statewide in Pennsylvania. Geography used to limit me to mostly the East coast, which is consistent of the Eastern and middle districts on the Eastern coast of Pennsylvania, because I didn’t want to drive every day to Pittsburgh to meet with clients. You know, it’s four or five hours away, and I didn’t want to spend that time away from my family. And what’s wonderful right now is in the entire state of Pennsylvania and New Jersey as well. we can file bankruptcy without ever meeting you in person or having you in our office, just like, with Brent, the court has relaxed our wetting signature.

And I think for you, Sam as well, so we can send you documents to be signed with your telephone. You know, these things are amazing. These days, you turn your telephone sideways, you scribble on it with your finger and you’ve signed federal paperwork that gets filed and eliminates your debt from your home. And in addition to that, we can still, although we prefer to limit it where possible, but we still have people coming into our offices here. We have three offices in Allentown, Bethlehem, and Easton, physical locations. And we still have people coming in from time to time. And there are folks that don’t or feel very uncomfortable about zoom. So what we’ve done for them is you can come into the office and meet with us. Of course, you still have to wear a mask and sanitize and all of those things. But we also have set up in our conference room downstairs, a laptop to do the court hearings.

So if you’re uncomfortable doing the zoom court hearing from home, let’s say we interact, you know, you’re fine dealing with us, but when it comes time to court, you want to be sitting next to me. You want to be sitting with your lawyers so that you feel comfortable. We have the ability to do that. And one of our conference rooms downstairs, and this has allowed us to help and reach so many people that we couldn’t get to in the past. I’m just, I’m super excited to be able to help more folks and more folks now that these laws have been relaxed and changed. Yep, absolutely. Well, thank you very much, gentlemen. I’ve really appreciated the time we spent this morning. This has been a fantastic discussion and I just want to wish you and all of your clients, the best of luck in 2021 here, hopefully it’s going to be better than 2020. We certainly have to start getting things back to normal. And I hope the economy really turns around and, that we can all grow as a country together as a result of coming through this.

Thanks. Thank you, gentlemen. Thanks.