Chicago's Financial Rescue & Bankruptcy Lawyer Rich Fonfrias Explains
How You Can
Take Control of Your Finances and:

Keep Reading and You'll Discover…

• 21 Costly Mistakes to Avoid When Thinking About Filing for Bankruptcy in Illinois
• 7 Shocking (and Costly!) Facts About Consumer Credit Counseling
• 11 Tragic Misconceptions About Bankruptcy, and
• 8 Eye-Opening Secrets That Reduce the Pain of Bankruptcy

The National Bankruptcy Forum is a blog devoted exclusively to bankruptcy and related issues. It features contributing attorneys from across the country, including myself.

Your Location: I proudly represent business owners, executives and consumers in the Illinois cities of Chicago, Palatine, Evanston, Park Ridge, Elmwood Park, Oak Park, Hoffman Estates, Schaumburg, Hanover, Arlington Heights, Des Plaines, Northbrook and Glenview. With eighteen offices serving Chicago and communities throughout Illinois, Fonfrias Law Group is Chicago's experienced financial rescue and bankruptcy legal team, offering all forms of bankruptcy legal services, debt consolidation, bad credit repair, foreclosure defense, credit card debt management, loan and mortgage refinancing advice. We can help with all forms of homeowner and consumer financial rescue in emergency situations. While we are well known as The Chicago Money Lawyer; we are also known as The Illinois Money Lawyer, ready to assist and advise those with serious money issues in Illinois.

There are 6 types of bankruptcy in our legal system. The type of bankruptcy that you file depends on a number of factors. Bankruptcy laws are federal laws. Your bankruptcy will take place in Bankruptcy Court, which is a division of the U.S. Federal District Court. In order to decide which bankruptcy is right for you, it is important to have an understanding of bankruptcy law and the differences between the different types of bankruptcy. Most consumers usually file either Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. In Chapter 7 Bankruptcy (liquidation), the bankruptcy court requires that you complete a large amount of paper work, listing all of your assets and all of your debts or liabilities. You must also indicate any exempt property which by law you may keep. With Chapter 13 Bankruptcy, as well as completing a mountain of paperwork, you are required to negotiate with your creditors, work with the Chapter 13 Trustee and draw up an approved plan to repay your creditors.

Chapter 7 of the Bankruptcy Code provides for liquidation, meaning the sale of a debtor's nonexempt property and the distribution of the proceeds to creditors. In order to be eligible for Chapter 7, the debtor must satisfy a means test. The court will evaluate the debtor's income and expenses to determine if the debtor may proceed under Chapter 7. Chapter 13 of the Bankruptcy Code provides for the adjustment or reorganization of an individual's debts with regular income, sometimes referred to as a wage-earner plan. Chapter 13 allows a debtor to keep property and use his or her disposable income to pay debts over time, usually three to five years. Navigating your way through Chapter 7 Bankruptcy or Chapter 11 Bankruptcy can be a daunting experience for those who decide to go it alone, without the help of an experienced bankruptcy attorney. Bankruptcy is a complex process, with many potential pitfalls for those not thoroughly experienced in bankruptcy law. If you are unfamiliar with bankruptcy law, bankruptcy court or the American legal system in general and are considering filing for bankruptcy without the legal advice of a bankruptcy specialist, you are taking a huge risk. Declaring bankruptcy can be life-changing event. With your entire financial future hanging in the balance, seeking professional help in bankruptcy just make sense.

Chapter 11 of the Bankruptcy code general provides for the reorganization of debt and usually involves a corporation or partnership. It can also be used as a mechanism for liquidation. In most cases under Chapter 11, the debtor puts forward a plan of reorganization to keep their business alive and pay creditors over time. Individuals and those with small businesses can also seek relief in chapter 11. In general, Chapter 11 bankruptcy is available to every business, whether organized as a corporation or a sole proprietorship, and to individuals, although it is most prominently used by corporations. Chapter 11 usually allows the debtor to retain control of his business operations as a debtor in possession. This however is subject to the oversight and jurisdiction of the court. Due to the complexities of the bankruptcy process, anyone considering filing for Chapter 11 Bankruptcy should seek the advice of an experienced bankruptcy lawyer. A bankruptcy attorney can help you to protect your business from litigation by creditors and to keep as many assets as possible.

In the states of California and Florida, homeowners and individuals carrying debt have been particularly hard hit during the recession. Due to the sheer numbers of people in California and Florida in financial trouble, these states had seen widespread problems with disreputable financial rescue companies. Many Florida homeowners and people with debt problems in California have been taken advantage of by dishonest debt management relief companies or have been given disastrous advice from unqualified credit councilors. The practices of some Florida debt resettlement companies and some California debt resettlement companies have come under serious scrutiny. Consumers need to be aware of the laws of their state and consult with recognized state consumer protection organizations before dealing with any debt settlement company. The Fonfrias Law Group, an experienced and trusted financial rescue law firm serving Illinois, California and Florida, offers Florida debt settlement help and California debt settlement assistance. Our financial legal services can help with debt management relief in California and relief from creditors in Florida.

California and Florida homeowners are more likely than homeowners anywhere else in the country to own an upside down home. An upside down home is one where the owner owes more to the bank or mortgage company than the house is worth. Owning an upside down house means that the homeowner not only has zero home equity, he has negative equity. This growing problem of negative home equity is also referred to as having an upside down mortgage or an underwater mortgage. Most homeowners who are upside down in their home mortgage are in this position because their house has dropped in value and/or their mortgage loan balance has risen. Upside down homeowners face serious financial problems because they have no home equity to borrow against in case of an emergency and, should they wish to sell their home, they must come up with difference between what the property sells for and what is owed to the mortgage company.

California consumers should know that advance fees for California loan modifications are now illegal. As of October 2009, any person, including real estate brokers, real estate salespeople, lawyers, corporations, companies, partnerships or any other licensed or unlicensed person or party, cannot demand payment in advance for loan modification services in California. This includes any advance charges or collections, upfront or retainer fees, or any other type of pre-payment compensation, for loan modification work or services, or any other form of mortgage loan forbearance. It is a violation under California law for anyone to charge in advance for services such as home loan renegotiate, home loan modify, arranging to have a lender refrain from collecting mortgage payments, or assisting in avoiding foreclosure in California. For more details on Senate Bill 94 (Calderon) and recent changes to the law, visit the Government of California website.

If you are considering hiring the services of a debt settlement company, especially for Californian debt settlement services or Florida debt settlement services, make sure you check with a recognized state consumer protection group to find a legitimate debt consolidation company or financial rescue credit counselor who provides honest service and not one under investigation for fraud and deceptive business practices. For residents in Illinois, California and Florida who want to be certain that they receive the best financial help available, Richard Fonfrias offers debt settlement services to help people get back on their feet financially. Rich is a lawyer and a member of the Illinois State Bar, and the Attorney Registration and Disciplinary Commission which monitors and scrutinizes his services. Financial rescue clients can rest assured that if Rich were unethical or dishonest, the Illinois State Bar Association would revoke his license to practice law. For over 14 years, Rich has helped people in financial trouble by providing competent, effective legal and debt settlement services.

Today, more people than ever before are experiencing serious financial problems caused by accumulating debt. Whether the debt is related to high mortgage costs, unpaid medical bills, unpaid credit card debt or debt from loans, many people cannot pay their bills. Often people in debt are unsure how to get out of debt and where to go to get good financial help. Skyrocketing medical costs leave those without medical insurance with huge medical bills. A growing number of medical bankruptcies are the result. Declaring bankruptcy is often the best course of action for those facing overwhelming debt. If a debtor cannot work out an affordable plan to get out of debt, then he should consider Chapter 7 or Chapter 13 bankruptcy. Chapter 7 (liquidation) erases most of the person's debt. Chapter 13 (repayment) allows the debtor to negotiate a payment plan with creditors and then, with the Bankruptcy Court's approval, start paying down his debt. It is very important to talk to an experienced financial rescue and bankruptcy lawyer in order to get the best financial advice before taking any action.

The past few years have proven to be very difficult for many American families. Millions have seen their net worth plummet. Many have homes that have dropped in value and are now worth less than the amount mortgaged and owed to the bank. Many have lost their homes to foreclosure or have filed for bankruptcy. Throughout the country, people are coping with serious money problems, dealing with creditors, debt collectors, loan officers, repossessions, wage garnishing and worse. Even today, many hardworking Americans are still deep in debt and are finding it impossible to meet all their financial obligations. Although the recession is officially over, there are a lot of people still struggling with significant financial problems. Reduced income caused by job loss or a reduction in work hours is making it difficult for some to pay their bills. Other are faced with substantially increased mortgage payments due to adjustable rate mortgages.

In 2010, there were almost 1.55 million bankruptcy filings in the United States, an 8% increase over the previous year's bankruptcy total of nearly 1.44 million. Although bankruptcy numbers are still rising, they have slowed down considerably when compared with 2008 to 2009 where bankruptcy filings increased a staggering 32 percent. While this slowdown represents a small sliver of hope for recovery, there are still more families facing financial ruin, overwhelming credit card debt, home foreclosures and bankruptcy. As well, some economists are predicting that, due to a very busy 2010 holiday shopping season, early 2011 may see a further increase in bankruptcy filings when cash strapped consumers discover that they can't pay their holiday bills.

California, Florida and Illinois were states that reported some of the highest bankruptcy filings numbers in 2010. With more than 255,000 bankruptcy filings, the state of California has the dubious distinction of having the highest number of bankruptcies in the country. Florida came in second, with over 110,000 filings for bankruptcy, an increase of 16.5 percent from 2009. Both Florida and California were hit especially hard when the housing bubble collapsed, and both states were hit with unemployment numbers higher than the national average. Two Federal Court Districts that received the highest number of bankruptcy filings in 2010 were Los Angeles, California and Jacksonville, Florida. The Floridian Middle District, which includes Fort Myers, Orlando, Tampa and Jacksonville, saw almost 67,000 bankruptcy filings in 2010. The Florida Times-Union reports that this means that almost one out of every 100 area residents declared bankruptcy.

Although experts agree that the economy is starting to recover, as of Feb 2011, the mortgage crisis continues to drag on. In 2010, 33 states saw an increase in foreclosure rates, with Arizona, Nevada, New Jersey and Utah reporting the biggest jump in foreclosure numbers. Particularly disappointing was the performance of loan modification programs like the Home Affordable Modification Plan (HAMP) that did little to reduce the high number of distressed loans. December 2010 saw a drop of 58% in the number of mortgage modifications from the April 2009 peak. Financial professionals agree that low mortgage modification numbers will probably result in more home foreclosures in 2011.

While financial analysts have come down hard on (HAMP) and other loan modification programs that have been ineffective at significantly reducing the number of foreclosures, they also warn consumers about dual tracking, a policy of many financial institutions that puts homes up for sale while the homeowner is working to save it from foreclosure. There are thousands of borrowers, negotiating to lower mortgage payments with their lenders, who are unaware that their lender is, at the same time, working to sell their home. Advocacy groups want to end dual tracking and are outraged with banks and other mortgage investors for "tricking" homeowners. They feel that more needs to be done to increase public awareness about the shortcoming of the dual track system and to curtail the questionable practices of some banks servicing delinquent mortgages.

Home loan modification programs can be difficult to understand. It is important for homeowners in financial trouble to get independent, expert advice to guide them through the complicated process and to help them better understand all the pitfalls, advantages and potential outcomes possible when making the decision to apply for a home loan modification. Even though the banks may not be helpful disclosing details, it is up to the consumer to be fully informed. An experienced financial rescue and bankruptcy lawyer should be the first person you turn to for help. You will find a wealth of timely information that may help you to save your home, on the Chicago money lawyer Rich Fonfrias' website.

It is important for home owners who are struggling to make mortgage payments or facing foreclosure to understand that there are legitimate options available to help save their home. However, consumers should be aware that there are also many disreputable companies and con artists offering highly questionable financial help services that prey on people in financial distress. Currently, there are a number of mortgage relief and loan modification scams operating throughout the country that do little to help homeowners in distress and in some cases, make a bad situation much worse. Most of these phony credit counselors and scammers demand an upfront fee, and once they have your money, they do little to help and, in some cases, even make your financial problems much worse.

Something that every home owner in financial distress should know is that the Federal Trade Commission (FTC), the nation's consumer protection agency, has a Rule in place - The Mortgage Assistance Relief Services (MARS) that offers some protection for homeowners in financial difficulties. The MARS Rule makes it illegal for companies to collect any fees until a homeowner has actually received an offer of relief from his or her lender and accepted it. In plain language, this means that even if you agree to have a financial rescue or loan modification company help you, you don't have to pay until they deliver the result that you want. Knowing about the Mars rule could help protect homeowners from unscrupulous mortgage relief companies, con artists and phony home rescue scams. Just remember, if a company demands an upfront payment, best to find legitimate financial help elsewhere.

Mortgage relief and loan modification scams are as varied as the scam artists that run them. They also use an array of tactics to find their victims. Some con artists read through public foreclosure notices in newspapers and on the internet or through public files at local government offices to find homeowners in financial distress and send personalized letters, offering "financial help" or "credit counseling." Others place advertisements in newspapers and magazines, or advertise on television or radio, giving them a false air of respectability and making them appear legitimate. You will also find ads for loan modifications and foreclosure help posted on telephone poles, median strips, at bus stops, and on the internet. Many mortgage relief scam artists promote their businesses with flyers, business cards, or by selling their services door to door. They use simple, but potentially deceptive messages that attract attention, like: "Stop foreclosure now!", "Get a loan modification!", "Over 90% of our customers get results.", "We have special relationships with banks that can speed up the approval process.", "100% Money Back Guarantee.", "Keep Your Home. We know your home is scheduled to be sold. No Problem!"

There are a number of tactics that Americans struggling with mortgage payments and wanting to avoid foreclosure can employ and there are legitimate mortgage relief service providers that can help. Strategies that can let financially strapped homeowners keep their homes and help make their monthly payments more affordable include, Mortgage Modification; changing one or more of terms of mortgage to make it more affordable, Mortgage Reinstatement; working with the lender to reinstate the mortgage to take it out of default, Mortgage Replacement Plans; negotiating with the lender to pay mortgage arrears, and Mortgage Forbearance; having the lender delay foreclosure, while negotiating modified terms of payment .

If you are worried about defaulting on your mortgage and are considering mortgage modification as a way of avoiding home foreclosure, Illinois bankruptcy and financial rescue lawyer Rich Fonfrias is here to help. Rich has expert knowledge in Chicago mortgage modification, mortgage reinstatement, replacement and forbearance plans, as well as other legal strategies that can be employed to prevent foreclosure. He will examine your current financial situation to help determine your best course of action to achieve the best possible results and save your home from foreclosure.

Bankruptcy, home foreclosure, mortgage default, credit card debt, tax liens and bad credit, these serious financial problems are affecting more Americans than ever before. Rest assured that there are legitimate workable solutions available that can eventually fix even the most desperate financial situation, however it is important to get the best financial and legal advice possible for the most favorable outcome. For Chicago bankruptcy advice, talk to Richard Fonfrias, an Illinois financial rescue lawyer who can help you decide whether bankruptcy is right for you or if you can save your Chicago home from foreclosure. A well-respected financial rescue and bankruptcy lawyer based in Chicago, Illinois, Richard Fonfrias has practiced law for over 13 years and has comprehensive experience working with individuals, families and business owners to assist them in overcoming serious financial problems. Chicago Money Lawyer Richard Fonfrias represents clients in a wide variety of financial difficulties, including creditor lawsuit defense, credit card defense, foreclosure defense, debt elimination, reduction and settlement, tax elimination, loan modifications, mortgage modifications, and chapter 7, 11 and 13 bankruptcies.

If mounting unpaid bills, escalating debt, and calls from collection agencies are causing you stress and worry and you are seriously questioning the sustainability of your current financial situation, you need to take immediate action, either by tackling the problem yourself or by seeking the advice of a financial expert like a credit counselor or bankruptcy lawyer. The sooner you address the situation and take control of your finances, the quicker your problems can be resolved. If action is taken in time, it might be possible to fix your credit problems and improve your financial circumstances on your own. There are several things that you can do right away to get yourself back on the road to financial health, before the damage is irreversible.

The next step that you should take is to call your creditors. Your creditors really do want to hear from you, especially if you are behind in your payments. By calling your creditors, you are demonstrating to them that you are a responsible person who is serious about repaying their financial obligations. You will find that most of your creditors will be willing to work with you to find a solution. Ask your creditors whether they are willing to offer a reduction in your payments, an extended deferral of your debt, a longer repayment plan, or a reduced interest rate. It is important to remember that your creditors want to get paid, and by working with you, they stand a much better chance of collecting. Depending on the debt, if you were to declare bankruptcy, your creditors are unlikely to receive anything and they know it.

Next, consider the advantages of consolidating all of your unsecured debt with a consolidation loan. Loan consolidation is a way for a debtor to turn multiple unsecured loans, credit lines, credit card debt , etc. into a larger single loan, paying off most, if not all creditors. Bear in mind that secured debt, like your home mortgage, is not eligible for loan consolidation. Many financial institutions offer debt consolidation loans. Often a consolidation loan will have a lower interest rate than what you might currently be paying, to credit card companies and department stores. The money that you save on interest charges can be substantial.

If you are totally committed to eliminating debt, avoiding bankruptcy and solving your personal money problems, you may want to consider selling any high-value possessions you own that you could live without or that are costing you money to maintain. Assets such as second homes or recreational properties, second cars, boats and other high price recreational vehicles, and even valuable art and jewelry. The sale of any of these items will not only give you cash to pay down your debt, it could also reduce your monthly expenses as well. By example, if you were to sell your second car, you would no longer have to make car payments, or pay for insurance, licensing and maintenance on that vehicle. If you sold a vacation property, you would eliminate bills for property taxes, maintenance, insurance and mortgage payments, if the property has been mortgaged. Often valuable jewelry and expensive art is insurance. Sell these insured items and you no longer need to pay to insurance them.

Financial Rescue & Bankruptcy Services

Business Services

♦ Creditor Lawsuit Defense ♦ Credit Card Defense ♦ Foreclosure Defense ♦ Stop Bank Account Seizures ♦ Prevent Equipment Repossession ♦ Debt Elimination, Reduction, Negotiation, Restructuring & Settlement ♦ Loan, Mortgage & Line of Credit Modifications ♦ Review & Modification of Lease & Loan Contracts ♦ Bankruptcy Alternatives ♦ Chapter 7 Bankruptcy (Liquidation) ♦ Chapter 11 Bankruptcy (Reorganization)

Consumer Services

♦ Creditor Lawsuit Defense ♦ Credit Card Defense ♦ Foreclosure Defense ♦ Debt Defense ♦ Wage Garnishment Defense ♦ Prevent Bank Account Seizures ♦ Prevent Car or Truck Repossession ♦ Credit Card & Other Debt Elimination, Reduction, Negotiation, Restructuring & Settlement ♦ Loan, Mortgage & Line of Credit Modifications ♦ Illinois Bankruptcy Alternatives ♦ Fonfrias Fresh-Start Debt-Free Financial Plans ♦ Chapter 7 Bankruptcy (Liquidation) ♦ Chapter 11 Bankruptcy (Reorganization) ♦ Chapter 13 Bankruptcy (Repayment)

Credit Repair

♦ Removing Mistakes in Bad Credit Reports ♦ Erasing Compliance Violations ♦ Improving & Optimizing Your FICO Scores ♦ Building New Credit ♦ Managing Existing Debt ♦ Rehabilitating Defaulted Obligations

Solving Tax Problems

♦ Removing IRS Tax Liens, Bank Levies & Wage Garnishments ♦ Filing Late Tax Returns ♦ Erasing Taxes Through Bankruptcy ♦ Settling Back Taxes ♦ Saving Your Chicago Home or Business

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