Interviewer: What would you say is the point where people will realize that they have to go on bankruptcy? When do they say, “This is the point now, definitely now is the time to do it”?
James Logan: Most people, they try to hold on and they think it’s going to get better so they go and try to hold on and it’s not until they actually get a foreclosure notice in the mail or their cars’ repossessed that they’ll actually pick up the phone and call us. At that point, we could still help them but obviously it’s a lot easier if we can have more time to work and provide other solutions for them. The human nature is that people think things are going to turn around and they hold on and they hold on and then they don’t do anything until the last minute.
There is Excessive Negative Publicity Regarding the Bankruptcy Process
One of the reasons is people don’t want to file a bankruptcy, there’s so much negative publicity out there about filing bankruptcy that people are afraid that they’re going to lose everything and they’re going to end up by on the street and their credit’s going to be ruined and everyone will know that they filed, and not all these things are true but that’s what people believe because that’s what they hear on a TV and on the radio and on the internet and all the stuff. You got to talk to a lawyer, a bankruptcy attorney, he’ll find out the truth and you’ll be much better off.
In 99% of the Cases Filing Bankruptcy Actually Improves the Credit Scores
Interviewer: Would they be able to rent an apartment or house after they file for bankruptcy and if so, how soon after?
James Logan: The number one fact that people do not understand about bankruptcy is that bankruptcy in 99 per cent of cases will actually improve your credit, most people by the time they come to see me their credit score’s down in 500s because by the time they come to see me, they’re behind in everything and they’re in foreclosure and their car’s been repossessed. At that point, your credit is as bad as it’s going to get. By filing the bankruptcy, you’re actually going to start to improve your credit because your creditors are required to report 0 balances on your credit report after you file a bankruptcy.
The Credit Report Will Have Nothing But Zeros in it After Bankruptcy is Filed
So, your credit report will have nothing but 0s on it after you file, which is actually better credit than having charge offs and late payments and all the other things. So, by filing bankruptcy, you’re actually going to start improve your credit and in fact, they’ll have a credit report that we get shows the kind of improvement that you can expect to get based on your particular situation after you file a bankruptcy.
Remedial Measures For Creditor Harassment Offered by the Bankruptcy Process
Interviewer: Would creditors start calling people over and over again and they start getting these harassing calls from creditors, can bankruptcy actually make that stop happening?
James Logan: Absolutely. The most powerful part about the bankruptcy is what they call the automatic stay. Immediately upon filing the case with the bankruptcy court, all your creditors must stop, any collection actions, collection calls, lawsuits, foreclosures, repossessions, garnishments, all that must stop, it doesn’t matter whether they know about it or not, they still must stop. That’s the most powerful part of the bankruptcy and the bankruptcy judges are very serious about enforcing that. So, if people don’t stop their collection activities, the courts will definitely come down on your side in that case.