Bankruptcy While Applying for Disability

A client who is in the Application-Denial-Appeal cycle of disability benefits will often experience severe financial difficulties before they obtain their award. Contrary to some popular misconceptions, bankruptcy laws can actually help preserve a client’s resources and assets. Bankruptcy while applying for disability is possible.

  1. Missed house payments can be paid over 36 to 60 months without additional interest in a Chapter 13 bankruptcy. A client who can pay their regular house payment and the arrearage payment will be able to keep their home. During this time, bankruptcy while applying for disability may be right for you.
  2. A car loan that would be paid off during a Chapter 13 Plan can be spread out with lower payments over the whole 36 to 60 months of the plan. During this time, bankruptcy while applying for disability may be right for you.
  3. A client who has lost their driver’s license due to non-payment of fines will get the license back if the fines are included in a Chapter 13 Plan.
  4. During this time, bankruptcy during disability application may be right for you.
  5. Store credit card balances secured by purchases such as Sears or Les Schwab may be reaffirmed at a lower balance and payment based on the current value of the products purchased on credit. During this time, bankruptcy while applying for disability may be right for you.
  6. Again, contrary to conventional wisdom, student loans may be partially or fully discharged in bankruptcy. In order to do so, “a debtor must establish (1) that he cannot maintain a minimal standard of living for himself and his dependents, based on his current income and expenses, if he is required to repay the student loans; (2) that additional circumstances (disability) indicate that his inability to do so is likely to exist for a significant portion of the repayment period of the student loans; and (3) that he has made good faith efforts to repay the loans.” Judge Corbett in the Eastern District of Washington requires debtors and student loan lenders to attend a mediation to resolve the matter based on these factors.

Filing for bankruptcy while applying for disability may be the right choice for you.

Bankruptcy and Tax Refunds


Christmas Credit May Sink Your Bankruptcy Lifeboat

Many people put off hard decisions until after the holidays, whether it’s surgery, divorce or filing for bankruptcy. And with the easy availability of bank and store credit cards, the decision to fund holiday purchases by borrowing is all too tempting. After all, if you plan to file for bankruptcy after Christmas, what’s the harm?

Credit card purchases for Christmas gifts are considered non-essentials by the court. If they are charged within 90 days of filing bankruptcy will not be discharged, meaning you will still have to pay those bills in full. You may also be faced with collection lawsuits or a foreclosure that will not allow you to wait 90 days to file. Only essential services or items can be discharged in the bankruptcy. So, don’t fall into the holiday credit trap. Make that hard decision to plan for the financial safety of your family as well as for their holiday spirit. If you have any questions, call Steven Schneider, Attorney at law, (509) 838-4458.

Using Your Tax Refund to File Bankruptcy?

One problem everyone faces when considering filing for bankruptcy protection is how to pay for the attorney and filing fees. Attorney fees for a typical Chapter 7 start at $800 and up depending on where you live.  A Chapter 13 bankruptcy can cost $3,000 and more. Filing fees paid to the court are aa little over $300. Most of this must be paid before filing.

Fortunately, this is the perfect time to use your tax refund to get you out of this dilemma. File your tax return as soon as you can once you receive your W2 form from your employer. E-filing and electronic deposit can speed up the process of receiving your refund. While you are waiting for your refund, plan your filing with your attorney. A partial payment may allow some of the work to start in the meantime. Once you receive your refund and pay the fees, your bankruptcy usually can be filed within a week or two. Call our office and talk to attorney, Steven Schneider, first to see if it will work for you. (509) 838-4458.

Spokane Junk Debt Collectors

Spokane Debtors and Cach, LLC

(Cach, LLC and other Spokane Junk Debt Collectors are serving Spokane debtors with unfiled lawsuits, many of which cannot be collected in court unless you ignore the lawsuit.)

In the past two months Cach, LLC has filed a total of 22 collection lawsuits in Spokane County Superior Court. That is just the tip of the iceberg. As you will learn below, Junk Debt Collectors make their money on unfiled lawsuits.

Spokane Junk Debt Collectors

Cach, LLC is one of many Junk Debt Collectors that take assignments of debt in bulk paying pennies on the dollar for the chance of collecting less than the full amount of the debt.  There are hundreds of lawsuits filed in Spokane County alone that are the work of Junk Debt Collectors.

How Junk Debt Collectors Work

Typically, Junk Debt Collectors will serve the Summons and Complaint but not file the paperwork in court. This saves them the $240.00 filing fee and attorney time, so you can see that their profit margin is low to begin with.  Junk debts are likely to be handled by law firms outside of Spokane County, and often in other states.  Again, you can see that this factor means they are highly motivated to settle without actually going to court. Many junk debts also lack sufficient documentation or are beyond the statute of limitations.  This  means that although the debts could not be collected in court, the collectors are counting on you voluntarily paying to get them off your back.  If you make even one payment on an uncollectible debt, the statute of limitations starts running all over again from the date of that payment.

Ignoring The Summons and Complaint

If you ignore the Summons and Complaint, then the collector will obtain a judgment against you by default.  That judgment will be in the full amount of the original debt; jackpot for the collector! All of a sudden you have an enforceable judgment against you that is good for at least 10 years of garnishments and property seizures. Your negotiating leverage has disappeared.

 Help for those in Spokane Junk Debt CollectorsWhat You Should Do You Are Served

If you are served with a collection Summons and Complaint, filed or unfiled, call an attorney who can efficiently deal with the problem. Don’t wait, in as little as twenty days you could be a judgment debtor.  Steven Schneider, Attorney at Law, P.S.

Junk Debt Collectors

A couple of years ago in the midst of the “Great Recession” we started to hear complaints about “Junk Debt Collectors.” Because of the failure of financial institutions such as Countrywide and others, many past due debts, even home loans, were not the subject of collection efforts for years.

The collection value of such old debt is minimal and some has even gone past the statute of limitations, 6 years on a written account contract in Washington.

final notice for debt collection or unpaid bill

A number of things will tip you off that the contacts you are receiving are from Junk Debt Collector:

  1. The debt is more than 5 years old.
  2. The attorney is not located in Spokane, but Portland, Seattle, Denver or elsewhere.
  3. Midland Funding, Portfolio Recovery Associates and LVNV are very active junk debt collectors in this area and nationally.
  4. Early efforts are made to compromise the claim for a smaller amount.

Volume Discount Collectors

Keep in mind these are volume discount collectors. They did not pay face value for the assigned debts, bought in bulk for cents on the dollar, and any recovery is a win for them. They may not be able to prove the original debt because of lack of documentation and may be unable to collect in court because of the statute of limitations.  It is also a violation of the Fair Debt Collection Practices Act to try to collect such an unenforceable debt. Collectors risk punitive fines and attorney fee awards for such violations.

 Forcing the Cessation of Junk Debt Collection

We examine each case for these legal issues before approaching with settlement offers. We have successfully forced cessation of collection efforts in some cases, and deep discounts in others.  An attorney can evaluate your individual case efficiently if you are the target of a Junk Debt Collector and determine the best way to protect your rights and assets.

Civil Rights and Bankruptcy Laws

Bankruptcy is a Civic Right

Many people who come to me for advice on bankruptcy feel ashamed and question the morality of discharging debts.  Most people are very concerned about how they are perceived. Even in distress, disability, old age, or in situations no one could control they don’t want to be seen as someone who doesn’t pay their debts. But Bankruptcy is your right.

We the People US Constitution

What they may not know is that the United States Constitution specifically instructs Congress to make bankruptcy laws.

Section. 8.

The Congress shall have Power  . . .;

To establish an uniform Rule of Naturalization, and uniform Laws on the subject of Bankruptcies throughout the United States;

Civic Rights Free Citizens form Oppression

This is an important civil right because the practice at the time of the American Revolution was to put honest debtors who couldn’t pay into prison, until they or their families could buy their freedom.  The United States of America was established to free its citizens of many forms of oppression, including debtors’ prisons.

Congress has established and maintained uniform bankruptcy laws, including the current Bankruptcy Code, adopted in the mid 80’s and last significantly amended in 2006.  The over-arching policy of the law is stated by Congress as giving debtors a “fresh start” and creditors an “even playing field.”

Lenders, especially credit card companies, take the certainty of bankruptcies into account in setting interest rates. Once a bankruptcy is filed, the debtor becomes a consumer again who buys goods and pays taxes and is a benefit to the economy. The bankruptcy laws therefore, promote the social goals of helping honest debtors out of poverty, preventing homelessness and creating a productive employed citizenry.

Each case of bankruptcy has its own unique considerations, but for the average citizen overwhelmed by matters out of his or her control, it is a basic civil right.  Contact a knowledgeable bankruptcy attorney to discuss your case at

Skagit Bridge Collapses

Skagit Bridge, Skagit Bridge collapse, Skagit County economy, Whatcom County economy, bankruptcySkagit Bridge collapse still affecting small business owners

Economists know that few things are as important to commerce as transportation. An incident like the Skagit Bridge collapse can have a rippling effect on the local economy, especially small business owners. Skagit County and nearby Whatcom county are still feeling the effect of the Skagit Bridge collapse. The bridge was a crucial part of the I-5; tens of thousands of cars crossed it daily. With the bridge no longer intact, all of that traffic is being diverted to other routes and many would-be travelers are deciding to stay home or go elsewhere.

Sales are down

Late spring and summer is an important time of year for any economy. It’s a time for shopping and increased sales across all industries. But so far this summer has seen a decrease in sales. One local business, Skagit Cycle, is seeing sales a 30% drop in sales during their busiest season. According to Skagit Cycle’s owner Gary Santiago, his customers are avoiding the traffic and detours, and as a result, aren’t coming into his store. While a temporary fix is in the works, a permanent solution probably won’t be complete until sometime in the fall. An entire summer of decreased sales may prove too much for smaller businesses to handle.

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Do-It-Yourself Bankruptcy

Do-It-Yourself Bankruptcy, is it the best choice for you?


Now days DIY (do-it-yourself) projects are becoming increasingly popular, with our economic status and the need to save money, it may seem like a good idea, but is a DIY bankruptcy your best choice? For the latter of Americans, a DIY bankruptcy could end up costing you more than it will save you. Bankruptcy attorneys have the experience to properly prepare your bankruptcy filings in order to benefit you.


Most Common Disadvantages of do-it-yourself Bankruptcies:
1) Bankruptcy is a complicated process. You will spend hours trying to educate yourself on the procedures of a bankruptcy case where a bankruptcy attorney will already know what needs to be done. It is much safer using an attorney who already knows the system to avoid any complications or mistakes that could occur if you try to prepare and file on your own.


2) Bankruptcy hearings and meetings require your presence. Judges and Trustees may present questions or concerns regarding your bankruptcy, you may not know the answers to, where an attorney will know the general issues that cause concern and the way to settle those concerns. Often times Debtors give too much information or say too much while in the presence of the judge or trustee. For example, questions that may be asked of you in a meeting of creditors are extremely limited; you will not know what questions you don’t have to answer.


3) There is always a greater chance of making a mistake when you are preparing a bankruptcy yourself. Once again bankruptcy attorneys prepare and file bankruptcies daily; they know the system and the way to properly prepare your bankruptcy in the best interest of you, the Debtor. Non lawyer bankruptcy form preparers are allowed only to assist in filling out forms and may not give legal advice. They must not instruct you what to do to get the best result; a lawyer is obligated to do just that.

4) Some errors in bankruptcy, such as not reporting property, pre-bankruptcy transfers, or certain creditors, may violate Federal Criminal Law. Debtors violating such laws may face jail time.

These are just some of the disadvantages you may face when filing a bankruptcy yourself. As a law firm we would advise you to seek the advice of an attorney before attempting to file Bankruptcy on your own.