Month after month of non-stop battering, each time some optimistic spark deep within produces a faint glow of hope that it can’t get any worse, something new goes wrong.  This month consumer confidence was like a sky diver with a defective parachute. The reason? More bad news of increased job cuts, and decreased retirement accounts.

In fact, there was no good news of any kind for the short term. The best news, if you can call it that, was from the Fed which said that the economy is undergoing a “severe contraction” that would last for the first half of this year.

All the major retailers reported bad fourth quarter results, and home prices recorded the sharpest drop ever. Search where you will, there was no good economic news anywhere. The best news available was actually the absence of bad news – gas prices did not show any indication of going up in the near future.

In New York, the Conference Board advised that its Consumer Confidence Index which showed only a small drop in the December - January period (perhaps because of the holiday mood) experienced a sharp drop of 12 points this month to currently rest at 25, far below the projected level of 35 that experts had predicted. Nassau County foreclosure lawyers say they may be able to help stop or prevent foreclosures, or relieve financial burdens if they are called in to help early enough. It’s very important not to delay asking for help from a bankruptcy or foreclosure lawyer.

Foreclosing on a mortgage is a major step for any family and the fact that foreclosure attorneys are being consulted in this volume only substantiates the fact that many families have reached the brink with literally nowhere to turn.

Most analysts say that looking ahead, at least in the short to medium term, increasing worries about business conditions, corporate earnings and employment security are creating a vicious cycle of steadily reducing consumer spending which is exactly the opposite of what is required to kick start the economy.

Consumers are also scared by the free fall in home prices which have plunged by over 18%, the largest fall in 21 years. Today’s property prices are what they were in 2003.

While consumer confidence will naturally be affected by what has happened since last September, what is worrying is that even optimism for the future was absent until Obama took office. It surged then, but has already started to drop because illogical miracle solutions that people hoped would keep them away from bankruptcy law firms in Suffolk County and other parts of New York, did not materialize.

There may be hope for those who are able to hold on for a few more months may not see a return to prosperity, but at least a light at the end of the tunnel.

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Experiencing a financial crisis can be embarrassing. Often we might try to hide it or otherwise compensate for it in some way: some people will do just about anything to avoid defaulting on their obligations. The fact of the matter, however, is that more and more people are failing to maintain their financial status; the global market downturn is having a monumental impact on us all. Indeed, America is encountering an unprecedented wave of credit defaults, foreclosures, and bankruptcies. For some, it might help to know that you are not alone- even the most financially thrifty and responsible persons can be deeply affected by the turmoil in this unheard-of worldwide economical sandstorm.

The year ending 2008 is expected to see as many as 2.2 million home foreclosures, which was the same amount for 2007 when foreclosures were up by an extraordinary 75%. That is an enormous percentage of the total homeowners in the country. In fact, during a particular 6 month period in 2007, foreclosures numbered 200,000 or more every month. Because there was a record period of growth, there will now be a record period of decline that will impact people from all walks of life. So many homeowners are struggling that the government has passed legislation that will prevent people from losing their properties in the light of this worldwide crisis.

Bankruptcy filings are up as well- by more than an astonishing 30%. By the end of 2008, it has been projected that 1.2 million bankruptcies will have been filed for the year. This is occurring even with the new bankruptcy laws enacted in 2005 that were designed to make it harder to file bankruptcy. In fact, there are so many new bankruptcies being filed that it has created a nearly overwhelming strain for bankruptcy lawyers and clerks- perhaps some of the only people in the world to be benefitting financially from this economic meltdown. Their newfound business will be bitter-sweet, but the fact remains that their services are needed now more than ever. As if to illustrate this point, bankruptcy filings are especially high in the areas hit hardest by the housing slump- California, Florida, and Michigan all report filings up 30% from this time two years ago, and those numbers are expected to increase for some time. Fortunately, many bankruptcy proceedings are allowing consumers to keep their homes, thus alleviating the number of foreclosures the country is currently experiencing.

Last quarter, 1% of all credit card accounts were considered seriously delinquent- 90 days or more past due. When you consider that the total credit card debt in this country is currently 15.4 billion dollars, that represents a huge portion of balances that are technically doomed to default. Last month alone, credit card debt rose by 11.3% - an unexpected increase, but one that has been trending with similar increases for several months now. This means that consumers are using their revolving accounts more to maintain their basic expenses, especially now that funds from refinancing mortgages have virtually evaporated. This is dangerous territory from a credit standpoint, as the situation will almost surely result in more people filing for bankruptcy protection.

The point is that many people are struggling. Even responsible people who have always been very careful about their finances are being included in the ever-increasing surge of foreclosure notices, collection activities, and bankruptcy filings. But you should know that you have options. There are ways to get help, and there are things that you can do to pull yourself up from the drudgeries caused by the global financial catastrophe that we are all experiencing. Bookmark this blog, as we will discuss in clear terms how to manage, utilize, or avoid any of these predicaments.

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Times are tight- there’s no doubt about that. Just look at the growing number of vacant and boarded up homes in Long Island to verify that. Foreclosures are on the rise in New York, and most consumers are not educated enough in these matters to effectively facilitate their own rescue, or quietly and appropriately allow to happen what in many cases is inevitable- without doing unnecessary damage to their credit, legal standing, and emotional well-being. For these reasons, it is absolutely crucial to consult with qualified and experienced New York foreclosure attorneys. Many people, however, do not take this vital step, as they do not truly understand what foreclosure attorneys can do for them. Let’s examine this:

First of all, a foreclosure attorney brings piece of mind. Knowing that your situation is in competent hands can be a big relief. Your finances and all related agreements will be reviewed, and the attorney will discuss your situation in general. If you have already received a summons or complaint, the lawyer will respond to that while keeping you within very tight legal guidelines. If you are unemployed or underemployed, the attorney will argue under a statute that allows extra time to file your response to the complaint, and may also allow a legal delay in the foreclosure proceedings, up to six months. Responses to the complaint will include any defenses developed by you and your legal counsel.

Believe it or not, part of a foreclosure attorney’s job is to review ways to actually prevent the foreclosure. They will discuss possible methods used to gain foreclosure prevention assistance with you, such as those offered by State and local governments and social organizations. In addition, they will explore your standing under the Federal program known as Hope Now, and will be able to explain what this program is in terms that you can understand.

If a foreclosure is unavoidable, a foreclosure attorney will advise you whether to ask for a “Strict” foreclosure, or a “Foreclosure by Sale.” Each type is very different, and needs expert understanding in order to determine the best choice for any particular situation. To prevent either type of foreclosure, an experienced attorney may assist you in obtaining a “Deed in Lieu of Foreclosure.” In most cases, a deed in lieu of foreclosure allows you to return the property title to the bank without forcing them to incur court and litigation costs, and in return, the bank or lender agrees to not seek judgment against you for any amounts owed that the return of the deed does not cover. These are all highly complicated issues, and therefore reinforce all the more why a professional foreclosure attorney is needed.

Some fears regarding the general welfare of the economy and consumer confidence were somewhat eased by the relatively high shopper turnout on Black Friday. Crowds were so large at a Long Island Wal-Mart that an employee was trampled to death when the thousands of shoppers thronged outside broke the doors and rushed in. While shoppers did not spend as much as they have in past years, retailers were reportedly pleased with what was a solid shopping day, and relieved that the gloomiest forecasts did not come to pass. Strong consumer spending, on the surface, bodes well for the economy as a whole. One question that ought to be asked, however, is what impact this allocation of scarce funds toward holiday shopping will have in the following months.

The preceding months have brought us story after story of middle class Americans struggling to remain economically viable and avoid financial ruin. Money is scarce for families all around the nation and the percentage of households struggling just to make ends meet has skyrocketed. The recent decrease in both gasoline and home heating oil prices has created a very positive economic boost for many. Money that even a month ago had to go straight in to commuters’ gas tanks can now go into cash registers around the country. However, the rapid fluctuations in the price of crude oil that have occurred recently must, if we are to be responsible members of this economic community, give rise to doubts that the price relief will last. If crude oil were again to rise past the $150 dollar mark, the retail spending increase would instantly be null.

Even with gas prices at a level that is more comfortable for consumers, families are still making sacrifices. A recent news story described the efforts of some parent’s groups to petition toymakers to cut back on advertising, as many parents cannot afford to keep up with their children’s demands. The parent’s group’s complaints to the toymakers stem from the self described inability of parents to sacrifice their children’s holiday wishes. One parent even went so far as to say that she would commit crimes to give her child a toy that he wanted. With so many parents unwilling or unable to cut back on spending for their children, money must be reallocated within the family budget. Money set aside for mortgage payments will likely find its way into toy store coffers this month, and the result will likely be a spike in home foreclosures in January and February.

The economic stimulus of the Holiday season will, at least in the short term, give a much-needed boost to the economy at large. Retailers will hopefully be able to earn enough to get them through the winter without too many store closures. Where the funds that make this possible come from, however, could make for an even more challenging economic climate in the coming months. Concerns about the source of newfound spending money are valid, and should not be ignored. If these assumptions about where the stampeding Wal-Mart crowd got its money pan out, Nassau County foreclosure attorneys are going to have a busy winter.

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The economic woes of the United States have been at the forefront of the minds of nearly everyone. Magazines feature countless articles about the deteriorating economy, blogs express frustration and opinions on the bad financial decisions made on Wall Street, and the television reminds us daily that things are going to get worse before they get better. Each month, more and more people are seeking the advice of foreclosure attorneys in Nassau County and Suffolk County. Companies are folding, and jobs are being lost. The price of practically everything is steadily increasing. As Americans, most of us are very unaccustomed to a restricted or severely limited budget. For this reason, there tends to be this general feeling that things are very bad right now in our country. However, this is not the case in reality, and with the holidays upon us, we could all use a reminder of what we still have.

In the next few days, families will be gathered all across the country. We’ll have lovely dinners together, gifts and smiles will be exchanged, and there will be plenty of wonderful holiday parties to attend. We’ll do what we do every year: we’ll stuff our faces with turkey and ham, candies and cheeses; we’ll knock back a few glasses of eggnog, and we’ll spend a little bit more than our budget might allow on gifts for those that we love. And even though we know it will hurt the wallet and the credit card later on, we will take great joy in doing it anyway.

While all these joyous and fun activities are occurring, it might be wise for us to step back and examine what we really have. For most of us, we have our families, and we have our health. We still drive our cars, talk on our cell phones, and retire each night to watch cable or satellite television. We still eat well. Even those whose homes are foreclosed upon have somewhere to go- there are family, friends, shelters, and inviting places all over the country that will house and feed those in need. We still eat out, and the drive-thru lines at most fast food restaurants are still crowded most of the time. We take warm showers and baths; we sleep in warm beds and snuggle with our pets and loved ones. We email and chat, we video-share and play games, and we listen to music. We watch movies and cook popcorn with extra butter; we go out every so often and have a beer or a cocktail. When we see the Salvation Army Santa Clause we drop our spare change in his bucket.

The point is that yes, times are tough. But are they really so bad? We still have just about everything we had before. And if we lost something as a result of all of this, then thankfully we live in a place where we can rebuild if we have the ambition and the drive to. Because the truth of the matter is that we’ve still got it pretty good. All over the world, children and even entire families will suffer and starve while we celebrate with those closest to us. The wars that rage across the world do not stop while we enjoy our holiday fun. So perhaps this holiday season we can all give ourselves a gift that will make us feel much better: we can dig a little deeper in our pockets for charities, and we can realize that we’re going to be just fine.

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In Long Island, foreclosures are on the rise.  In fact, both Nassau and nearby Suffolk counties have some of the highest foreclosure rates in the entire state.  The alarming number of for sale signs and vacant homes evidences this.  For many local families, this means that they have had to “downgrade” to a less expensive home, renting an apartment, staying with friends or relatives, or receiving some type of government assistance.  While experiencing a foreclosure can be tough, there should be a relief in that there is a lot of help available for American families and individuals who need it.  Even for those who lose their home and have very little or no resources, there are always shelters available, food programs, and many types of free assistance.  In fact, we should be thankful that we live in such a country.  In other places in the world, families have no options at all. 

There are foreclosures, so to speak, in Gaza.  But it doesn’t occur after you’ve spent a year or two in a home rent-free while a bank slowly works to evict you.  It’s not when you simply decide a house is too much for you financially and you volunteer to give the keys back to the bank.  In Gaza, a foreclosure occurs when a bomb falls from the sky and obliterates everything you own.  In Gaza, a “foreclosure” often kills entire families.  Communities, relationships, and careers are destroyed all at once.  There is no recourse; there is no legal process or attorneys that get involved to help.  There is no leniency, and there are certainly no banking officials willing to lend assistance after listening to a sad story of economic loss.  In Gaza, a “foreclosure” means that, if you survive, you simply walk away from the rubble and start over with nothing.  You pray that your family, friends, and neighbors were not killed or maimed.  You pray that there will be food to eat, water to drink, and somewhere that you can go.  Desert nights drop down to freezing even in the summer, and those who are displaced often die of exposure.  What’s worse is that sometimes these people die from the desperate acts of others in similar situations.

So Americans should take heart.  A foreclosure is not the end of the world.  In fact, it can often be a fresh start- a way to climb out from under a financial burden that many find to be nearly insurmountable.  In the United States, a foreclosure doesn’t kill anyone.  It doesn’t rob you of life and possessions.  It won’t even put you on the street.  There are always options.  So if you are experiencing a foreclosure, you should feel relieved that nothing truly bad or harmful is going to happen to you.  Your loved ones will be safe, your job will likely be unaffected, and you’ll have somewhere warm to go.  Although it is certainly a difficult process to be foreclosed upon, we should give our thanks that we live in such a place where we can easily start our climb to the top again.  Because for other people around the world, this is simply not the case.  Remember this, and it will help you to keep things in perspective.      

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With all the dramatic economic and political changes that are occurring in the United States recently, one would think that the implementation of major beneficial changes to the credit industry would be a widespread media event.  This should especially be true if the changes were beneficial solely to consumers.  However, apparently this is not the case, as very few people overall have heard of the sweeping changes that were brought to the credit industry on Thursday, December 18^th.  New regulations adopted and passed by the Federal Reserve, the United States Department of the Treasury, and the National Credit Union Administration brought unprecedented changes for virtually anyone that uses or issues credit. These changes are designed to protect consumers.  This is highly unusual, as credit reform in the last decade has usually been favorable for the creditors and lenders- not the consumers.  Analysts are already predicting that these changes may lessen the spate of recent filings of chapter 13 bankruptcies in Nassau and Suffolk counties.  But don’t go swiping that card at the terminal just yet- the changes do not take effect until July 2010.  

Perhaps the most significant change adopted this month was to limit a creditor’s ability to arbitrarily and unfairly increase interest rates.  In the past, most credit card companies had policies that stipulated their ability to increase your interest rate for practically any reason.  This practice has served to seriously damage the financial health of thousands of individuals who revolve credit card balances.  Often, rates were increased if a debtor was late by even a few days with a payment- including those people with otherwise stellar credit.  Other times, rates were increased to offset losses sustained elsewhere in the financial institution.  With the new changes, such practices will no longer occur.  New regulations mandate that rates may not be increased on existing balances.  People who establish a new account are, of course, subject to whatever rate they sign to.  However, once a consumer revolves a balance beyond one repayment period, their interest rate cannot be increased as long as they carry that particular balance.  If the consumer makes new purchases, those purchases can be subject to a higher rate. 

Few consumers have heard of a neat little credit card company trick called payment allocation.  This is where the creditor allots your payments to balances with the lowest interest rates first.  Different types of transactions have different types of interest rates with credit card companies.  One way creditors lock consumers into debt cycles is to allocate their payments to the transaction balances with the lowest interest rate first.  In this way, you pay for a much longer period of time on the higher balances, making it hard for your overall balances to actually decrease.  Not a very nice trick, eh?  Well, this will no longer occur.  Effective July ’10, payments must be allocated to the highest interest rates first.  This is a substantial benefit to consumers, and will help to alleviate the debt of tens of thousands of people. 

The reforms also call for 45 day notices to be issued in the event of changes to an account’s terms, longer time periods to pay balances in, and reduced over-the-credit-limit fees and late fees.  However, all these positive changes will have some negative impacts.  Primarily, these reforms will make it harder for people with substandard credit to obtain subprime credit cards.  For everyone, the changes will result in increased costs associated with credit cards such as yearly fees and new account interest rates.  There has also been speculation that the exchange rate (the rate a merchant is charged each time a credit card is swiped in their business) may be increased, which will likely result in a corresponding increase in goods and services at locations where merchants accept credit cards.  However, it should be noted that the benefits of these comprehensive credit reforms far outweigh the few problems they might create.  And besides, Americans need a break- this could be exactly what many of us are looking for.        

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With the Holidays fast approaching, many people are facing the distasteful choice of either cutting back on what they give to their friends and families, or spending beyond their means and either going into debt or forgoing necessary payments (such as mortgage payments, bills, etc). A rash of irresponsible spending, while giving a quick superficial bump to the national economic numbers, would result in disaster in the coming months as it would likely lead directly to an increase in home foreclosures and chapter 13 bankruptcy in Long Island. Luckily for most of the country (excepting retailers), the Commerce Department reported a 1.8 percent drop in sales last month. This seems to be evidence that people are cutting back on spending, but it could have other causes.

The drop in monthly retail spending was the fifth consecutive one, and the longest extended period of falling sales since the Federal Government began keeping track of such numbers. This drop may have been due to consumers re-prioritizing how they spend their money, but it is more likely a result of less disposable income being available. The economy shed over 50,000 jobs last month, bringing the number of unemployed in our country nearer to six million than it has ever been.

While this news is clearly negative, it becomes even worse if two other facts are considered in conjunction with it. First, the government assumes that due to a constantly expanding workforce, 150,000 jobs must be created per month just to keep pace. A loss of 50,000 jobs, therefore, translates to a month in which 200,000 people are unable to find work. Second, people who are employed part time, underemployed, or who are employed for less than a living wage are not counted in these numbers. Many such people cannot keep up with bills and living expenses, let alone spend extra money for gifts, dinners, and other economic boosters. As the economy worsens, many workers will find their positions redefined, relegating them to the ranks of the working poor. These losses will not show up in unemployment figures, however, and so will be another unmeasured strain on the economy at large.

A weakening economy is an entity that fast becomes like a self-fulfilling prophecy. As jobs are lost discretionary spending decreases, which in turn strains retailers who then must cut more jobs, which further exacerbates the problem. With the prospect of the loss of the “big three” automakers looming, it is easy to see how fast things could get exponentially worse. While some may think it is their patriotic duty to go out and “shop ‘til they drop,” it is far wiser to ensure that you meet your major financial obligations before spending on luxuries. The number of people facing the prospect of unemployment, a decrease in wages or available hours to work, or other financial disaster is fast increasing, and no-one is immune. If you are in such a position as this and feeling increasingly desperate, then you should visit a local bankruptcy attorney to discuss your options. You may be able to improve your financial position and consequently your quality of life. 

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                Recently, economic news from both Wall Street and Washington has become increasingly more dismaying. Officials are desperately working to quell fears that America is heading toward financial disaster. Some of the language that has been chosen by these officials, however, has been indicative of the opposite conclusion. For instance, one term that has been bandied about rather freely regarding the subprime mortgage crisis is “perfect storm.” Since the release of the hit movie of the same name, this term has been overused to hyperbolically describe nearly everything that has gone wrong. However, the term might still be useful in deconstructing the metaphor in order to predict where we possibly could be headed.

                The term “perfect storm” refers to a set of conditions that occur simultaneously in order to create the worst possible outcome. It originally was used to describe the Halloween Nor’easter that hit Atlantic Canada in 1991. The storm was the result of an unlucky confluence of weather events that, while individually would have been rather benign, resulted in the second most costly hurricane of that year. Like many powerful coastal storms, there was immediate damage and loss of life, and, while the storm was raging, widespread fear and panic occurred. People could only hunker down and wait for the storm to pass, all the while hoping for the best.

           After the storm, the people who were spared during the initial onslaught emerged to face the destruction that was left in the storm’s wake. The effects of the storm were widespread, and the building process was extremely costly and time consuming.  Bearing this in mind, reflect for a moment on Hurricane Katrina. It made landfall on New Orleans and the Gulf Coast in August of 2005 and caused incredible damage not only to the infrastructure of the region, but also to the inhabitants. Widespread disease and looting occurred even after meteorological calm returned to the region. The consequences of this storm were so appalling that some residents who were stranded in the aftermath expressed that they wished they had fallen victim to the fury of the actual storm itself. Even today, more than three years later, conditions in New Orleans are inexcusable: crime, poverty, and unemployment are rampant. While a storm can be terrifying as it is battering us, it is often the rubble left in its wake that is the hardest to cope with.             What does all of this have to do with our current financial situation? Assuming that the subprime mortgage crisis was (or is) in fact a “perfect storm”, it means that after the visible bank closures and the initial wave of bankruptcies and foreclosures, we still have a long way to go. The aftermath of this financial hurricane will not be contained to the banks that owned the risky (and now valueless) mortgages, nor to the people that invested heavily in an inflated stock market. Every one of us will be forced to deal with the destructive wake of this financial crisis.            Even in relatively affluent areas the situation is grim. Unemployment, bankruptcy, and foreclosures in Suffolk County have risen immensely from October 2007 to October 2008, and this trend throughout the country is either comparable or far worse. The initial shock to the economy will reverberate for years. The preliminary losses will, due to basic economic principles, continue to multiply. Furthermore, a lack of credit from banks stifles job creation, which slows spending, which in turn causes businesses to cut back. This downward spiral is self-perpetuating, and needs to be actively broken. We can all contribute to this by making wise decisions regarding our financial situations and especially our credit. If you do not fully understand what you ought to do to help not only yourself, but also the economy at large, consult an attorney who is experienced in matters relating to credit, bankruptcy, or foreclosure. It cannot eliminate the fact that the initial storm occurred, but it can help staunch the bleeding and speed the rebuilding process of our storm-damaged economy.    –

Times are tough. Our entire economy is in severe crisis, and with the rest of the world experiencing similar hardship it is unlikely that we will encounter a quick, easy solution. Home values are plummeting, causing people stuck with less than ideal mortgages major financial distress. Companies are folding and laying people off, making jobs even scarcer than they already are. Costs are skyrocketing for nearly all goods and services in our daily lives, and every indication is that things are probably going to get worse before they get better. If you are having a tough time right now, you are not alone. The good news is that there are solutions that you can use to improve your situation and relieve the burden of debt that is currently crushing you.

One very good option for some people is to declare bankruptcy. Bankruptcy rates are rapidly increasing from San Francisco, California, to Long Island, New York and everywhere in between. The people making the decision to declare bankruptcy are from all walks of life, and all income levels. There is no archetypal bankruptcy case. The one thing that they have in common is that they all made a business decision to help ease their burden and start over with a clean slate.

Some people with loads of personal debt do not consider bankruptcy as an option because they think that it is something to be ashamed of. This could not be farther from the truth. Declaring bankruptcy is not weaseling out of your financial obligations- it is making a serious and well thought-out business decision to utilize an established financial tool to help improve your quality of life.

Bankruptcy as an institution exists because people get caught in unexpected situations that turn their world upside-down. It is not designed to protect lazy people that are trying to game the system, but instead to protect people like you- hard working individuals that due to falling home values, rising medical expenses, or some other previously unforeseen trouble now find themselves on the verge of drowning. If the owners of a big corporation find themselves with mounting debt and little to no chance of recovery, they sell off their assets and declare bankruptcy, effectively canceling their debt. They do this without apology to laid-off workers or upset shareholders. They do not feel bad about the decision because they exercised their right to use an existing solution to minimize future hardship. This tool is available to you as well, and you should not discount it as an option because of a non-existent moral obligation to a creditor.

Declaring bankruptcy is an entirely valid way to address crippling debt before it is too late, and it can be the best decision for many people. As with any other business decision that you make, it is important to understand all of the facts. If you are experiencing financial trouble, talk to an experienced bankruptcy attorney who will be able to inform you about your myriad options and whether or not bankruptcy is a viable solution for you.

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