The Helbing Law Office, LLC provides debt relief to Wisconsin residents.
At the Helbing Law Office, LLC, we help Wisconsin residents secure the debt relief they need through Chapter 7 and Chapter 13 bankruptcy filings. We also provide information and guidance on how student loans are treated in the different types of bankruptcy.
Bankruptcy can be strict with education loans, but consumers have options.
helbinglaw.com An advocate may help find relief.
It isn't surprising that incomes are down due to the COVID-19 virus; however, research indicates that once some people return to work, it will be at reduced incomes as high as 23%. If this is you, will you be able to pay your bills going forward? Please contact me if you would like to discuss your options to deal with this.
msn.com In total, $1.3 trillion in income has been erased due to the pandemic, research published by the Society for Human Resource Management and Oxford Economics found.
If you're fall into this category, and are delinquent on your mortgage, I can help! Please don't allow the lasting result of this virus to be you losing your home. Contact me with any questions.
usatoday.com Delinquencies among borrowers for past-due mortgages are soaring, a sign that Americans are struggling to pay their bills due to a wave of layoffs or lost income from the coronavirus pandemic.
It has been almost two months now since Governor Evers entered the “safer at home” order. Last week, the Wisconsin Supreme Court struck down his extension of that order. With that ruling, businesses are slowly beginning to open statewide, albeit with many safety precautions in place. Several bars opened their doors on the heels of the decision, with patrons eager to get out of the house and have a few spirits at their favorite watering holes. Hair salons will be opening their doors in anticipation of being extremely busy. This is all too welcome as many of you need a haircut! Gyms will be opening soon as well. Everyone will be able to work off those few extra pounds of inactivity.
For many, this is a welcome site. Everyone wants to put these last two months in the rear view mirror and move on. However, for some, the stress will continue. Many of you did not receive a penny from the government during this shutdown. It truly is maddening to think that the governor put in place a “safer at home” order preventing you from earning a living, yet the state did not have capacity or resources in place to make sure everyone received unemployment during the shutdown. Unbelievable! Whether this was a lack of insight, poor planning, or simply unintended consequences is for each you to decide. Opinions vary.
What is clear though is this: many of you are in financial distress. Did you miss the last two mortgage payments? Did you request a deferment or forbearance from you lender and have no idea how you are going to get caught up? Were you hanging on by a thread before this crisis hit? Are phone calls starting from the credit card companies or collection agencies?
So, where do you go from here? In my opinion, the first thing you SHOULD NOT do is withdraw money from your retirement account to pay these bills. Why? If you withdraw money from your retirement, many of you will have to pay a 10% early withdrawal fee. This fee is on top of the taxes you will have to pay on the money withdrawn. For most of you, that is probably 25% of the amount withdrawn, if not more. Don’t sacrifice your future for a problem that is fixable in other ways today.
In my opinion, a bankruptcy or a section 128 is a much better option. I know for many of you bankruptcy has a negative stigma attached to it. Please understand this: Bankruptcy IS NOT a scarlet letter anymore! If you are behind on your home, a chapter 13 will allow you to pay the arrears over a 60 month period. A chapter 13 will also allow you to pay your other creditors at 0% interest. For those of you who qualify for a chapter 7, this can eliminate all of your unsecured debt and start over. A section 128 is not a bankruptcy. It is a debt amortization plan that allows you to pay back your creditors over 36 months interest free. The unique thing about a section 128 is that Wisconsin is the only state with such a plan.
You didn’t ask to be out of work. You didn’t ask to be labeled “non-essential”. As far as you’re concerned, your job is essential! Unfortunately, for many of you, the state didn’t offer any help. For those of you who did receive unemployment, it may not have been enough. Options are available to you to eliminate the financial stress caused by COVID-19. The hardest step is always admitting to yourself that you need help. Please don’t sacrifice you house, health, or overall family well-being because of pride.
As always, I am available to speak with anyone regarding your financial situation and the options available. Please feel free to contact me with any questions. Also, if you think what I had to say in this post is beneficial, please share it. Others, who normally don’t see my posts, may benefit from you sharing this post.
Protests over state “stay at home” orders are happening all over the country. Here in Wisconsin, a protest is scheduled to take place this Friday, April 24th, in Madison. Over 12,000 individuals has stated an interest in attending this protest despite the state refusing a permit for the protest. This begs the question: Is this protest a good idea? Honestly, I don’t know.
What I do know is this. Over 22 million unemployment applications have been filed nationwide to date. Wisconsin alone had 263,000 weekly claims filed last week. That number is likely to increase now that self-employed individuals are now allowed to file claims. These numbers are nothing short of staggering. The federal government is doing everything in its power to prevent these numbers from increasing. For example, Congress is likely to pass another stimulus package that allocates $321 billion to the widely successful Payroll Protection Program (PPP). This is on the heels of the previous $350 billion that has already been allocated to small businesses. In order to receive this money, employers have to call back their employees. Whether these employees actually work, or simply draw a paycheck, is completely up to their employers. So, is receiving a paycheck under these circumstances “normal”?
I completely understand the desire to get back to normalcy. However, these are not normal times and will “normal” be what we once knew, or will it be a “new normal”? The motivation behind PPP is well intended; however, is it enough to save these small businesses? The program is only intended to last eight weeks once your loan is approved. What are these small businesses to do if eight weeks simply isn’t enough? The President has devised a staggered plan to reopen the economy. So, what does this mean? Even assuming Phase 1 takes effect immediately after the “stay at home” order expires on May 26th, our small businesses will not be back to “normal”. Social distancing will still be highly recommended. Mass gatherings will be highly discouraged. Phase 1 recommends no gatherings larger than 50 individuals. How will small businesses with 150, 300, or even 500 employees handle this? It seems that nothing going forward will be “normal”.
The sad truth is many small businesses, especially those in the service industry, simply are not equipped to withstand these shut downs and wait this out. The uncertainty of these times is too much. If you are a small business owner and have come to the conclusion that you need to close your doors permanently, my heart goes out to you. In these difficult times, I want you to know that you have options. Bankruptcy may have been the furthest thing from you mind when you opened your business. It may not have even crossed your mind six months ago. However, through no fault of your own, it may be the only option for you at this time. So, if you have come to this conclusion, then you need to start thinking about protecting yourself and your family. You need to close your business with the least financial impact on you personally as possible. To do this, you need to consult a bankruptcy attorney.
Please feel free to contact me with any questions. I am always willing to discuss your current situation and what options are available to you.
Yes, I am a bankruptcy attorney, but I’m also a small business owner. I’m fortunate because the State of Wisconsin views me as an “essential” worker. With all of modern technology, I can have my laptop on my kitchen table. I can have all phone calls forwarded to my cell phone. I can meet with clients virtually. I am fortunate in the sense that I can abide by the “stay in place” order and still operate my business with very minimal interruptions. Others are not so fortunate.
Small business owners are being affected all over the country. Even in the best of times, operating a small business can be a “zero sum game”. The hidden costs of being a small business owner are very real. Many had to mortgage their homes to get a start-up loan. Others may have had to give a personal guarantee on additional business loans (meaning if the business can’t pay back the loan, the business owner will) to stay afloat. Add in the payroll costs and insurance costs associated with operating your own business, and one starts to wonder if following your dream was really worth it?
It is being widely reported today that the Payroll Protection Program (PPP) has run out of money. This program was specifically designed for small businesses (less than 500 employees) to help them get through this difficult time. Now small business owners are stuck in the dilemma of deciding to lay-off their employees, so those employees can claim unemployment, or hope that Congress will stop playing politics and add additional funds to the program to keep employees on the payroll. Even if additional funds are allocated to the program, will it be enough? The program is designed to last for eight weeks and only applies to payroll, rent or mortgage interest, and utilities. If you use the money for supplies, inventory, or other accounts payable, the loan won’t be forgiven.
The unfortunate truth going forward is this. The government told these businesses to close their doors. Many will not reopen their doors. Unfortunately, the creditors of these small businesses are still going to want to get paid. Some may wait until the pandemic has passed; however, eventually everyone is going to come knocking at your door. Lenders will want the personal guarantees to be honored. Vendors will want to be paid for the supplies provided before the doors closed. The government is going to want quarterly taxes to be paid. It really is adding insult to injury.
Many of you small business owners are going to feel overwhelmed. Which creditors should you pay? Are you personally liable for any of the debts? Will lawsuits start to be filed against you? These are all legitimate concerns. I highly recommend you speak with a bankruptcy attorney to determine your options. The best decisions are the ones made after having all the available information and knowing all your options. These times are stressful enough. Alleviate some of that stress by knowing your options. In the end, some of you may not need to file a bankruptcy. Wouldn’t you rather know that information now rather than stress over it going forward?
Please feel free to contact me with any questions. I am always willing to discuss your current situation and the options available to you.
We are now in Week 5 of the “stay at home” order in Wisconsin. As of right now, the order is set to expire on April 24th; however, it could very well be extended for an additional period of time. If you are a “non-essential” worker, there is no telling when you may be able to go back to work and your steady income. Essentially, we have no idea when we will get back to “normal”. So, where does this leave us now?
President Trump signed into law the CARES Act on March 27th which, among other things, provides that individuals affected by the coronavirus can received an additional $600 per week in unemployment compensation. Even those who traditionally would not be eligible for unemployment may qualify for unemployment under the CARES Act. It is now mid-April. Are you receiving those benefits? Many of you are not.
According the Wisconsin Department of Workforce Development, the $600 per week in additional unemployment compensation will begin to be distributed on April 26th. Additionally, those who would not normally qualify for unemployment (e.g. self-employed, independent contractors, individuals with a limited work history) may be eligible for state unemployment as well. However, those of you who fall under this category can’t begin to apply for these benefits until April 21st. But with little to no income over the past month, is this a little too late?
The CARES Act also provided an interesting change to the Bankruptcy Code. For the immediate future, any payments you receive from the federal government related to the coronavirus are not considered income for bankruptcy purposes. Additionally, coronavirus-related payments are not to be considered in determining your “disposable monthly income” for a chapter 13 bankruptcy.
So what is the practical impact of this? Traditionally, to determine which consumer bankruptcy you qualify for is based on your last six months of income, including unemployment income. This is still the case; however, payments made under the CARES Act are not part of the calculation. Only unemployment paid by the State of Wisconsin factors into the equation. Furthermore, if you find yourself needing to file a Chapter 13, you may qualify for a much smaller monthly bankruptcy payment.
In a prior post I told you not to panic. I realize that may be easier said than done considering some of you haven’t received any income or unemployment in the past month. I still firmly believe that for those of you who fall in this category, you first need to apply of unemployment as soon as you are eligible. Use your unemployment to pay your secured debts, e.g. mortgage and car. Next, make sure you have food on the table. Everything else can be fixed in due time.
If you have additional questions, please feel free to contact me.
Stay safe everyone!
Desperate times call for desperate measures. This week alone, the applications for unemployment benefits more than doubled to over 6.6 million. Realizing the impact that the COVID-19 virus was going to have on our economy, President Trump signed the CARES Act last week, which promises to pay, in addition to state unemployment, an additional $600 per week of unemployment benefits to those affected. The CARES Act even extends unemployment to many of those who would traditionally not receive unemployment. Under the Act, certain self-employed individuals are expected to receive unemployment benefits, e.g. Uber and Lyft drivers; hairstylists; handymen, etc. Obviously, with this many applications, and the states not necessarily sure how to handle the federal funds provided under the Act, there will most likely be a delay in receiving those benefits.
In lieu of not receiving unemployment immediately, the temptation to apply for and receive cash advances is awful appealing. These online lenders and cash advance stores make it awful easy to get cash quickly. My advice to you – BE CAREFUL! Read the fine print. Understand what you are getting yourself into. These are high interest loans! Over the past 20 years as a bankruptcy attorney, I have represented clients with cash loans ranging from 130% to 1,000% APR. I truly believe that these loans prey on individuals in times exactly like these. Remember what your mother would often tell you: No good deed goes unpunished.
How are these loans going to affect you? Many will require automatic withdrawals from your bank account. Others will expect you to make bi-weekly payments. Some may even require you to grant them a lien on your car or household goods. Failure to make payments may result in unending phone calls or text messages. A lawsuit against you isn’t unheard of. At these high interest rates, the shear amount that you will be expected to pay back is staggering.
Also, cash advances are not dischargeable in a bankruptcy if you took out the advance within 70 days of filing your bankruptcy. Why am I telling you this? Unfortunately, some of you may need to file bankruptcy when this is over. If you find yourself needing a fresh start, I want you to completely understand that your decisions and actions today may impact your ability to file bankruptcy down the road. There is no such thing as a free lunch!
If you have any questions, please feel free to message me.
Stay safe everyone!
Many of you may have questions regarding the information I stated in my last post regarding unemployment. It is my understanding that the Wisconsin Department of Workforce Development is still waiting for additional guidance from the federal government on how to proceed with the stimulus money. My advice to you: apply for unemployment even if you do not traditionally qualify for unemployment. It may take a couple weeks before you know for sure, but apply anyways.
Here is some additional from the Department of Workforce Development's website:
Stay safe everyone!
dwd.wisconsin.gov CARES Act - Federal Stimulus Bill.
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