Hello everyone, thank you for joining on This Needs to be Said, as we talk with our bankruptcy attorney, Bob Doig, and he’s going to share with us some insight in the world of bankruptcy. I want you to take your pen and paper out, class is in session. Bob, welcome back to This Needs to be Said. How are you?

I’m fine Katherine, thank you. I appreciate the opportunity to talk with you today.

Well I appreciate you accepting the invitation and hanging out with us here, and helping us to have a little more idea of the world of bankruptcy, making it less scary, making it more of a tool for us to use in our lives verses a shield of shame. I want to jump right into our first question about bankruptcy on today. This question, for me, I think about when I’m listening to the radio, and there’s a company that says, “If you have $10,000 in credit card debt, give us a call.” I’m thinking, “Well I don’t have $10,000 credit card debt, so maybe this doesn’t fit for me.” What I’m thinking is, when people think about bankruptcy, maybe they’re thinking of some amount of stuff, or money, that is what they would consider to be a large amount, and they think, “Well, I have little bit, so maybe bankruptcy isn’t for me.” How can someone know if bankruptcy is right for them? Is there a certain amount? Do they have be thousands or millions of dollars in debt? Or they have to have boats, and a lot of cars, how does a person know when they should call, contact you?

Well you know Katherine, of course, everybody’s situation is different. Certainly, if a person has $20,000-$30,000 in credit card debt that they can’t pay, that’s a pretty obvious situation in which case they might want to consider filing for bankruptcy. I’ll tell you, the bankruptcy code does not have a specific amount that needs to be owed before you can file bankruptcy. There are situations where people’s debts are really significantly less than $10,000, but bankruptcy is the right choice for them because maybe their wages are being garnished, they don’t have … They’re not highly paid, and they’re losing 25% of their take home pay every week, so even though the debts might be less than $10,000, there’s no way that they’re ever going to be able to pay that, and bankruptcy may be the right choice for them. You know, no two people’s situations are exactly the same. I get emails all the time saying, “Hey, should I file bankruptcy?” I really want to kind of delve into the person’s situation with them, explore all their options, because sometimes bankruptcy is not the right option. Even if the debts are more than $10,000 depending on other factors. It’s a case by case basis. I know that sounds kind of vague, but you know it’s the truth.

There’s no set price tag, or there’s no set picture, on what it looks like to say bankruptcy fits for you? Is what I’m hearing you say.

That’s exactly right. For one person $10,000 is a whole huge amount of debt. For another person maybe it’s not, and they could, if they have a good paying job, maybe they’ll be able to take care of that in a relatively short period of time. Yeah, I’m sorry that there are no … It’s no black and white line drawn where if your debts are under this then you don’t file, and if they’re over this you do. It’s just not that simple.

I think that is a good response though, because a person listening in to us talk on today can say, “Well there’s still hope.” Your situation verses my situation could seem overwhelming, but it still has a different price tag on it, or has a different grouping what I perceive to be overwhelming verses what you perceive to be overwhelming, and something that I can’t overcome verses what you think you can’t overcome. This isn’t one of those times I think, when I look at somebody else and says, “Oh gosh, I’m glad I don’t have their situation,” because it’s not a you don’t compare it. This makes me feel good that you’re going to have to look at me individually, and I don’t become a number to you, I’m going to be a person when I call you. It says a few things to me about the fact that there’s not a one size fits all for bankruptcy.

Let’s refresh people, because we’ve talked a couple of times before, about bankruptcy, and the benefit of bankruptcy as a whole. I guess what I’m really pulling for is that point of view, because before talking with you about bankruptcy I shared with you that there was a scary negative connotation. If you can help people understand that not only are you going to have to talk to them individually to understand their situation, that they’re not just a number to you, but this isn’t as scary as we thought it was.

Well, you know, the fact is, Katherine, most of us are brought up to believe, and we’re taught, that filing bankruptcy is one of the worst things that you can do. Boy, you want to avoid that at all costs. The truth of the matter is the purpose behind the bankruptcy code, and the laws that allow people to file bankruptcy, is to give people a fresh start when they’re faced with a financial situation that’s overwhelming. By and large the reasons that people get into this situation is they either lost a job or they’ve been divorced, in which case instead of having 2 incomes to support a household, all the sudden there’s one income supporting a household. Or, number three, is medical debt. I don’t know anybody who actually went and tried to get sick, to run up medical bills, but people come in, they feel bad. They’re like, I hear it all the time, “Well I did this to myself.” I said, “Oh, so you wanted to get sick?” Or, “You wanted to get hurt in an accident?” Of course you didn’t do that.

I understand it. It’s the way the vast majority of us were brought up, is that, if you get a bill you pay the bill. Sometimes there’s just not enough. There’s just not enough money to do that. That’s the purpose, that’s the number one purpose of the bankruptcy code is to give people a fresh start. That’s the deal. I don’t know if that answered the question, but I tend to kind of ramble sometimes. I’m sorry about that.

You did not, you did not. What I want to happen in these conversations is for people to feel comfortable. You intend to do the right thing, sometimes it doesn’t work out. Like you said, you didn’t plan to get hurt, you didn’t plan to be sick. It’s not what you want for your life. Don’t feel bad about having to reset. This is all good.

We’re talking with attorney Bob Doig, and he’s helping us to understand bankruptcy. Today’s question, the first question was, is bankruptcy right for me? What we were sharing with you all today, find your own answer. Is it right for you? Should you be calling? If you talk with him and he says, “No, this isn’t the right fit for you,” now you know for sure, because you’ve called, and he called to you the person, not a statistic, to let you know if it’s right for you or not. You did an excellent job. I think that it definitely made me more comfortable listening to your response. I just enjoy that it’s not this canned, one size fits all, and everybody who is bad files bankruptcy, kind of talk. I feel better about that which moves me right to the next question.

Let’s talk about some of the myths and misconceptions about bankruptcy. One where many people believe that they will not be able to get a car loan, or credit card, again. This is like this stamp on your life forever. You file bankruptcy, you’re bad, you can’t get stuff, and people worry about that. Can we talk about some of the myths and misconceptions?

Absolutely Katherine, you know, it’s a funny thing. My clients are surprised. I tell them this, but until they actually have filed bankruptcy they don’t realize, what happens is you file bankruptcy, and there are car dealers … I’m in Colorado, and we have some John Elway, the old Bronco’s quarterback, has car dealerships. A guy named Phil Long has a bunch of dealerships, and Larry Miller, and there’s Crazy Herman Used Cars. I tell them, “Hey, you know, within the next 2 or 3 weeks you’re going to get mail from John Elway, Phil Long, Larry Miller, Crazy Herman, and they’re all going to be telling you, “Come on in, and we’ll finance you for a car, a new or used car. We’ll help you reestablish your credit.””

If people think that by filing bankruptcy they’re never going to get credit again, that’s absolutely not true. As far as credit cards go, the same thing. They will get offers. Now often times they’re for secured credit cards, and they’re not for a lot of money, or a high credit limit. It might be $500. I encourage my clients to apply for secured credit cards at first, because that’s one of the ways that you’re going to really reestablish your credit. In fact I think I’ve mentioned this to you before Katherine, with my clients I enroll them in a program which if they follow it, they will be applying for credit cards, and they’ll be getting the credit cards, and their credit score is going to be excellent within 1 to 2 years after filing for bankruptcy. It’s certainly not a life sentence.

In fact, I get emails from past clients all the time, frankly, thanking me because their life is so much better now than it had been before. That they’ve been approved for a mortgage, and they’re buying their dream home, or they’ve bought a new car and they got a really low interest rate on it. They never imagined that they’d be in that position. Frankly, if they hadn’t filed for bankruptcy they wouldn’t be. Is there life after bankruptcy? Oh yeah, without a doubt, and it’s a better …

That’s good news.

… it’s a better life than it was before.

That’s the good news, because we do feel the shame and the guilt that goes along with it. I was just sharing on social media before we did our interview today, that guilt will keep us from moving ahead, because you said it will be even better. Well what about the people that’s around me, and this has nothing to do with our question Bob, but we feel guilty for doing better than the people around us, because bankruptcy is a bad word. Now we were able to hit reset, and Bob made me feel comfortable doing that. Now I was able to get back up on my feet, and actually I’m looking better credit wise, and all the way around, I’m looking better, but I feel guilty that I’m doing better than the people around me who seem to not be doing good. Guilt will hold us back, that word bankruptcy will hold us back, if you don’t have a better point of view, better perspective about it.

The good news is bankruptcy isn’t bad. The better news is you’re going to come out better than you were before, and stop talking to your friends about bankruptcy, and contact Bob. Talk to him about it and be able to move your life forward.

Now before we get out of here I want us to talk about … Well, let people know how to get in touch with you. I want to have you answer one or two more questions for me.

Sure.

One is about the publicity of my bankruptcy? Is it a public file? Will people know? Will it be in the newspaper? Then the second question, to follow up, if I owe back taxes, is that something that can or cannot be filed in bankruptcy.

Okay I’m going to deal with the tax question first.

Okay.

You know, if it’s income taxes there’s a general rule which says that income taxes owed for recent years are priority debts, in which case if you file a Chapter 7, then they’re not going to be discharged. If you file a Chapter 13, you’re going to pay the taxes through the Chapter 13 plan. Now, if the taxes are for a year … Say they’re for 2012, now the 2012 taxes were due in the middle of April of 2013, and it’s now 2016, so more than three years have passed. It’s October of 2016, more than three years have passed since the due date of those 2012 taxes. If you filed your taxes on time, and three years have passed since the due date, and the IRS has done their assessment, I think it’s 240 days or more, then they may be dischargeable. In other words, just like a credit card or a medical bill.

I’ll tell you what Katherine, that’s a real complicated area of the law. What I just gave you is just the thumbnail version. There are exceptions left and right. I wouldn’t want anyone to depend on what I just told you as the gospel, because there are plenty of exceptions. If somebody does have that sort of a situation, I’d be happy to discuss that with them and do a whole analysis on what would be dischargeable and what wouldn’t.

Now for the first of those two questions. Is it a public record? Yeah, you know, it is. When you file for bankruptcy it’s a legal care, and it has a case number, and it is a matter of public record. Are people notified? Well your creditors are notified, so people who you owe money, they get a notice, but employers are not notified, neighbors and family members are not notified, unless of course you owe them money when you file the case. As a practical matter, in most places where I practice, here in Colorado Springs, I’ve been here almost 20 years. In fact, it will be 20 years on Friday, yeah.

Well congratulations.

Yeah, thanks. The Colorado Springs Gazette, which is the big paper, it was called the Gazette Telegraph at the time, they would post on Saturdays, they would list all of the bankruptcy filings from El Paso County. Sometime, I don’t know, boy it has to be more than 15 years ago, they just stopped doing that. It’s not going to be published in the Gazette. Frankly, your family members and friends aren’t going to know you filed bankruptcy unless either you tell them, or they’re pretty savvy with being able to access court files, and they know where to look. As a practical matter, people are not notified. It’s a public record, if somebody really wants to find out about it, they can, but they aren’t going to be notified, you know, out of the blue. Does that answer the question? Sorry.

Well that does, that does answer the question. The last one is let people know how to get in touch with you. Again, congratulations, 20 years, congratulations. That is huge.

Thanks, thanks. Okay, so if people would like to contact me to make an appoint maybe, or just to talk over their situation, they can call me, the best number to reach me at is area code 719-428-3339. Again, 719-428-3339. I’d look forward to receiving any phone calls and discussing people’s situations with them, exploring all their options, and answering any questions they might have.

Awesome, until next time Attorney Doig. Thank you for your time.

Okay, thank you Katherine. Have a great rest of the day.

You do the same.

Thanks bye, bye.