tag:blogger.com,1999:blog-68662926931558347252024-03-05T17:15:45.449-08:00Arrow Law GroupU.S. law firm based in the Seattle, Washington area.
Arrow Law Group, PLLC
12826 SE 40th Ln, Ste A11
Bellevue, WA 98006
(425) 531-7946.Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.comBlogger22125tag:blogger.com,1999:blog-6866292693155834725.post-45043450167150648732018-09-26T01:36:00.000-07:002018-09-26T01:36:14.325-07:00Attorney's fee: who pays it?When a client comes to me with a potential lawsuit, one of the things that I research and discuss with the client is the potential liability for the other party's attorney's fee. That is, if the client lose, he will also have to pay the other party's attorney's fee--which may be more than what they thought it would be.<br />
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Most states adhere to the "American System" when it comes to lawsuits. This means that each side, win or lose, pays for their own lawyer. As a potential plaintiff, you can decide whether it's worth the legal expense to pursue a claim against someone. On the other hand, as a defendant, this means that if you are pulled into a lawsuit, you don't have a choice but to hire a defense lawyer. This system may seem unfair if you're a defendant, but it's designed to encourage settlement over litigation: neither side will want to spend more than the value of the claim. Who wants to spend $10,000 on a lawyer if the maximum recovery is $5,000?<br />
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There are exceptions to the American System. Most, if not all, states allow a party to recover attorney's fee from the losing side if the dispute relates to a contract and that contract contains an "attorney's fee clause". The typical cause will say something like, "In the event that a dispute concerning the contract arise, the prevailing party shall be entitled to attorney's fee and cost from the losing party." This is to discourage people from breaching a contract. I had a case where my client won a breach of contract lawsuit where the damage awarded was around $9,000, but my client's attorney's fee was $12,000. Had the opposing party simply paid up the $9,000 he owed my client, my client would not have had to spend $12,000 to hire me. Now, the opposing side will owe my client $21,000.<br />
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The other exceptions are called "statutory attorney's fee". These are laws that explicit awards attorney's fee to the winner of a lawsuit. These laws typically appear in areas where the parties are often not on level playing grounds. For example, landlord-tenant, consumer protection laws, or anti-discrimination laws. A tenant may not want to sue a landlord for discriminatory housing practice due to the legal cost unless he knows he will reimbursed; this also applies to a consumer who may not want to sue a giant corporation for product defect.<br />
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Most states also follow the "mutuality of remedy" doctrine. This means that if one party can recover attorney's fee from the other party, then the law will make it so either party can recover attorney's fee. Can you image a residential lease that says "only the landlord can recover attorney's fee against the tenant"? Such clause would be re-written, as a matter of law, to say "either the landlord or tenant can recover attorney's fee from the other party."Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-77463119392253405842014-01-15T19:26:00.002-08:002014-01-15T19:26:44.268-08:00I AM MONTHS BEHIND ON MY MORTGAGE -- WHAT DO I DO?<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgNfNEpJ_ZF8OWpYC9TMW4WS2apehar9cj2yIst6kuXOfP0dGi2cEqiKdwWpavS21KdH3SQgMttaOTqFWOWLbR4rLIlm5HRdTaTPpU0LGZsalMPGYvJo_YflqXBH2mDjWYmj9ZBUQVtPOcf/s1600/seattlelawyers.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgNfNEpJ_ZF8OWpYC9TMW4WS2apehar9cj2yIst6kuXOfP0dGi2cEqiKdwWpavS21KdH3SQgMttaOTqFWOWLbR4rLIlm5HRdTaTPpU0LGZsalMPGYvJo_YflqXBH2mDjWYmj9ZBUQVtPOcf/s1600/seattlelawyers.png" height="221" width="400" /></a></div>
I've realized that before people come to see me, they have already consulted with numerous people "in the industry"--and most of the time, the information they receive is incomplete or flat out wrong. This is because the first person most people call is their real estate agents/brokers!<br />
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Real estate brokers, though very knowledgeable about real estate, cannot give a complete picture. They are not licensed or trained to give advice on mortgage default, and people should never rely on their advice on how to handle mortgage default--no matter how trustworthy that person is. They generally have your best interest in mind, but real estate agents are simply not familiar with all your available options. Real estate agents can only offer to sell your home. Before you consider this option, call a lawyer!<br />
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My advice to folks out there who are behind on their mortgage is to contact a debt relief lawyer. Most debt relief lawyers are also bankruptcy lawyers and most offer one free consultation. The sooner that you talk to a lawyer, the more options you will have. If you wait until the last minute, or weeks before the foreclosure auction, to see a lawyer, you will find that your options are unfortunately <em>very</em> limited.<br />
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In Washington, where I practice (Seattle), you have several options.<br />
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<table cellpadding="10" cellspacing="10"><tbody>
<tr><td bgcolor="silver"><h1>
1</h1>
</td>
<td>If you want to keep your home, you can request an attorney referral to the foreclosure mediation program. This program is governed by the Washington State Foreclosure Fairness Act (2011), RCW 61.24.163. Foreclosure mediation is administered by the Washington State Department of Commerce and has been, in my opinion, a huge success. At mediation, lenders are required to review loss mitigation options including loan modification, short sales, etc. Mediation also delays foreclosure until a decision has been made.</td>
</tr>
<tr><td bgcolor="silver"><h1>
2</h1>
</td>
<td>If mediation is not possible or practicable, you can file a Chapter 13 reorganization plan. This is a form of bankruptcy relief. The bankruptcy court can reorganize your debts, including your mortgage, so that you can reinstate your loan. If you have multiple liens on your home (e.g., second mortgage or HELOC), the bankruptcy court can remove them to reduce your monthly payments. Best of all, foreclosure can be stopped at <em>any time</em> before the foreclosure auction. This means that you can come to me on a Thursday to stop a foreclosure scheduled to take place the next morning. (As a matter of law, foreclosure in Washington can only occur at 10 a.m. on a Friday).</td>
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<tr><td bgcolor="silver"><h1>
3</h1>
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<td>If you want to <em>walk away</em> from your home, or surrender it, you should consult an attorney right away. In <strong>Washington</strong>, if a lender conducts a non-judicial foreclosure on a home, the borrower is not liable for the deficiency. For example, if you owe $250,000 on your home, and it is auctioned off for $100,000, you are not liable for the $150,000 difference. This rule only applies to the lender that conducts the non-judicial foreclosure. The borrower is still liable to other lienholders (2nd mortgage, etc.) who did not participate in the foreclosure.<br />
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If you are not concerned about your credit, then sometimes letting a home going into foreclosure is the best. <br />
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I usually recommend exploring alternative options such as a short sale. A short sale is where the borrower and lender work together to sell the house at a fair price even if it less than what the borrower owes. The terms are negotiated between the borrower (usually though an attorney) and the lender. I find that lenders are eager to forgive deficiency if you work with them. The team at my office is stellar at negotiating favorable terms for our clients.</td>
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</tbody></table>
If you live in Washington, feel free to contact me directly for more information and legal advice. I have an office in Seattle and Everett, though I represent folks in Vancouver (WA), Tacoma, Federal Way, Renton, Seattle, Lynnwood, Everett, and Bremerton--you get the picture.Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-24219704424983333032013-07-28T15:02:00.001-07:002013-07-28T15:02:48.361-07:00What to do when you are facing forclosure. (Washington State)Lately, there has been this craze that we are somehow over this foreclosure mess. Yes, I admit that we have had a few good months of real estate sale; real estate inventory is low compared to the number of buyers. This doe not mean that the foreclosure auction blocks are empty. Every Friday as I walk into my Everett office, I see a swarm of investors (or people who call themselves investors) standing in front of the Snohomish County Courthouse anxiously waiting to bid on a foreclosed property. It is sort of ironic because my office focuses on helping people avoid foreclosure (or get closure in the whole ordeal).<br />
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For most folks, being forced into foreclosure is a scary thing. Dealing with the uncertainty of what comes next coupled with the bank's constant reminder of the outstanding debt is not easy. Most homeowners should understand though, that help is out there.<br />
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<strong>For homeowners who are trying to save their home</strong>, I usually advise looking into applying for a loan modification. Under the Foreclosure Fairness Act (2011) that I wrote about in another post, I can require the lender to stop the foreclosure process and help the homeowner explore options. We go to mediation face-to-face with the lender's representative (or attorney) and we review documents together. We have had the lenders reduce principal balances, interest, extend loan terms, and offer other work-out solutions. Keep in mind that every situation is different and we can never guarantee results.<br />
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There are times where mediation is not ideal. For instance, to qualify for relief, the homeowner must demonstrate a "hardship". If the homeowner makes too much money (in the bank's eyes), this will automatically result in a denial of any relief. For those cases, then I usually advise filing for Chapter 13 protection in bankruptcy court. Why? The Bankruptcy Court can <em>order</em> the lender to stop foreclosing and listen to the homeowner. Often, it shifts the ball back into the homeowner's court. Unlike mediation or applying for a loan modification, the lender is not free to do whatever it wants once the borrower has filed for bankruptcy relief.<br />
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<strong>For homeowners who do not want to keep their home,</strong> there are a couple of options. Sometimes letting the lender foreclose is wise. Other times, it opens the door for the homeowner to become liable to a second or third mortgages. I usually advise either (1) attempt a short sale, (2) consider a Chapter 7 bankruptcy, or (3) let the property go into the auction block and deal issues as they become real. I always recommend my clients to speak to me <em>before</em> attempting a short sale; most folks rely on advice from their realtor when engaging in a short sale. Only an attorney can give competent legal advice. Many realtors legally cannot tell homeowners the difference between a short sale and a foreclosure--so how do people know which one is better for them?<br />
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If you are homeowner in Washington who is facing a foreclosure problem, please do not hesitate to give me call. Call me before you start a short sale (before you sign that contact to list your home).Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com1tag:blogger.com,1999:blog-6866292693155834725.post-23535637792130208012013-06-14T08:14:00.000-07:002013-06-14T08:14:14.520-07:00The Pitfall of a Poorly Filed BankruptcyMany folks have asked me why an attorney will make a difference when filing for bankruptcy. Honestly, it might not make a difference depending on your circumstance. I've seen lots of bankruptcy filed without attorneys and they turn out just fine. On the other hand, I've seen some poorly planned bankruptcy turn very ugly for the debtors--costing the debtors everything they own and more.<br />
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Based on my experience, a simple Chapter 7 bankruptcy can run between $900 to $1,500 for attorney's fee. While that may seem a lot to folks who are scrapping the bottom, I always counsel folks against doing it themselves. The reason is because you cannot "unfile" a bankruptcy; there is no right to dismiss a Chapter 7 petition.<br />
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What happens when a creditor challenges your bankruptcy? There is a process called an "Adversary Proceeding" that is filed in a bankruptcy to challenge a debtor's right to a discharge of debts. In a nutshell, it is a lawsuit filed in bankruptcy court. These adversary proceedings are brought by disgruntled creditors who will stop at nothing to make the debtor "pay". Litigating an adversary proceeding can be costly. In some case, a well-planned bankruptcy can reduce the risk of an adversary proceeding. Win or lose, it is not unheard of to see a $20,000 to $30,000 legal bill to defend a poorly filed bankruptcy. I, personally, have actually billed this much to represent a debtor in an adversary proceeding. Most folks who are served with an adversary proceeding cannot afford to defend themselves and fall victim to frivolous challenges by disgruntled creditors.<br />
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When considering whether to go with an attorney or not, consider how much you can potentially <i>save</i> by going with a good attorney. Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-37858595594296033002012-08-07T01:52:00.001-07:002012-08-07T12:12:30.791-07:00How HAMP Loan Modifications Work<div>
<h2 style="text-align: center;">
<span style="font-size: x-large;">HAMP</span></h2>
In 2008, the federal government rolled out a program called the "Home Affordable Modification Program" or "HAMP". The program pays lenders to work with homeowners. However, the compensation is not very much (especially when compared to the <i>free</i> bailout money). Many homeowners still do not understand how HAMP works and become agitated when the bank representatives themselves can't explain it. <b>If you have been offered a HAMP modification, it is important to know how it works so you can decide what to do.</b></div>
<div>
<b><br /></b></div>
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The modification application requires the lender to review financial documents from homeowners. These documents are then used to figure out what terms are possible under HAMP using a <i>Net Present Value</i> test, also known as the Waterfall.</div>
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The first thing the lender needs to do is figure out their investors' interest rate limits. Since most home loans in the U.S. belong to Freddie Mac or Fannie Mae, you can usually find the weekly interest rate "floor" and "ceiling" online. <u>For purposes of this blog only</u>,<b> let's <i>assume</i> that the floor is 3.0% and the ceiling is 4.0%</b>. This means that the lowest interest rate that one can expect from a HAMP loan mod is 3.0% and the highest is 4.0%, although ultimately, everyone will end up paying the 4.0% (explained below).</div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjoIETbTtQuCIzYrhmjK6DAb5HqgbZxJqzL0OQT-RZ2-6QuXr75i530w2iTa-uery80VD9jj6y270ucmPrS-TMRCGMKiN3vfCT2HJo-8G-N303LeMr15N7rt3kLOyRDjzrBTa7b6Yb9tQB8/s1600/waterfall.png" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" height="259" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjoIETbTtQuCIzYrhmjK6DAb5HqgbZxJqzL0OQT-RZ2-6QuXr75i530w2iTa-uery80VD9jj6y270ucmPrS-TMRCGMKiN3vfCT2HJo-8G-N303LeMr15N7rt3kLOyRDjzrBTa7b6Yb9tQB8/s320/waterfall.png" width="320" /></a></div>
The lender then goes through a "waterfall" test based on government guidelines to calculate the optimal loan mod scenario. Since the lender is going to submit the application to the government for compensation, lenders have strict rules to follow. <span style="color: red;"><b>It is a mistake for borrowers to assume that HAMP loan mod terms are negotiable</b>. </span></div>
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<div>
Let's go through a waterfall test in its <i>simplest</i> form.</div>
<div>
<br /></div>
<div>
<div style="text-align: center;">
<b><u>HYPOTHETICAL FACTS</u></b></div>
<div style="text-align: center;">
<b><u><br /></u></b></div>
</div>
<div>
Assume that Alfred, a single man in Washington state, makes $3,500 per month. When he bought his home in 2008, it was worth nearly $365,000. Today, it is worth about $200,000 if he can sell it. The unpaid balance on his loan is $300,000; with an interest rate of 6.5% fixed for 30 years, Alfred's monthly payment is $1,896.20 not including property tax, insurance, and homeowner's association dues. He is currently 15 months behind on his payments and foreclosure is imminent. Assume also that Alfred can show hardship (that is, he didn't simply choose to work less hours and have medical problems). If Alfred is to apply for a HAMP loan modification, what results can he expect to see?<br />
<br /></div>
<div>
<table border="1"><tbody>
<tr><td><div style="text-align: center;">
Original balance</div>
</td><td><div style="text-align: center;">
Unpaid balance</div>
</td><td><div style="text-align: center;">
Property value</div>
</td><td><div style="text-align: center;">
Monthly income</div>
</td><td><div style="text-align: center;">
Current interest</div>
</td><td><div style="text-align: center;">
Current payment</div>
</td><td><div style="text-align: center;">
Delinquent</div>
</td>
</tr>
<tr><td><div style="text-align: center;">
$350,000</div>
</td><td><div style="text-align: center;">
$300,000</div>
</td><td><div style="text-align: center;">
$300,000</div>
</td><td><div style="text-align: center;">
$3,500</div>
</td><td><div style="text-align: center;">
6.5%</div>
</td><td><div style="text-align: center;">
$1,896.20</div>
</td><td><div style="text-align: center;">
15 months</div>
</td>
</tr>
</tbody></table>
<br /></div>
<div>
<b>Waterfall test #1: Reduce the monthly payment to 31% of borrower's income</b><br />
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$3,500 x 31% = $1,085/month.<br />
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If Alfred's payment is reduced to $1,085/month, his interest rate would be lowered to -0.60%. That interest rate are WAY below the floor rate (3.0%), the lender is required to move onto the next test.<br />
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<b>Waterfall test #2: Extend the loan term to 40 years</b><br />
<b><br /></b>
$1,085 at 40 years yields an interest rate of 1.3%. This is still below the floor rate thus, the lender is required to move onto the next test.<br />
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<b>Waterfall test #3: Apply principal forbearance</b><br />
<b><br /></b>
A principal forbearance means that some of the principal balance is not going to be charged interest. The lender starts with 4.0% (the ceiling rate) and start to decrease the interest in small intervals until it hits the floor. The idea to minimize the amount principal forbearance without cutting too much interest.<br />
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Here, Alfred would require a principal forbearance of $80,019.97. This means that the lender would waive the interest on this part of the loan. Usually, this means that Alfred will have a balloon payment of $80,019.97 at the end of his loan term. [Most people do not know about this].<br />
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<b>Results:</b><br />
<div style="text-align: center;">
<br class="Apple-interchange-newline" /></div>
<table border="1" style="text-align: center;"><tbody>
<tr><td><div style="text-align: center;">
New Loan<br />
Term </div>
</td><td><div style="text-align: center;">
Payment<br />
for first 5 years</div>
</td><td><div style="text-align: center;">
Interest<br />
for first 5 years</div>
</td><td><div style="text-align: center;">
Payment<br />
after 5 years</div>
</td><td><div style="text-align: center;">
Interest<br />
after 5 years</div>
</td><td><div style="text-align: center;">
Balloon payment<br />
at end of loan</div>
</td></tr>
<tr><td><div style="text-align: center;">
40 years</div>
</td><td><div style="text-align: center;">
$920.33/mo</div>
</td><td><div style="text-align: center;">
3.0%</div>
</td><td><div style="text-align: center;">
$1,050.64/mo</div>
</td><td><div style="text-align: center;">
4.0%</div>
</td><td><div style="text-align: center;">
$80,019.97</div>
</td></tr>
</tbody></table>
<div style="text-align: center;">
<br /></div>
Alfred's loan would be modified to 3.0% on $219,980.03; 0% on $80,019.97. The 3.0% will increase to 4.0% (ceiling rate) at month 60 (5 years) and then remain at 4.0% until the end of his loan term. That means that his loan payment will be temporarily reduced to $$920.33/month for the first 5 years; after that, it will be $1,050.64/month. At month 451, he will receive a bill for $80,019.97.<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEio6UdIkwzb-ZVFjvf6B8FoarRjb3qTkq-UbVikTAP0PjX51-b6a2cMrP3tuEOEYyi8BuJ2R1_SKWUhpMKifCcbRwtF1pyAhR8Q9TGjn_FAAUEXeZ8HPaowQkgUiBLwdDsP748DN6bWF-IR/s1600/happy.png" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="192" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEio6UdIkwzb-ZVFjvf6B8FoarRjb3qTkq-UbVikTAP0PjX51-b6a2cMrP3tuEOEYyi8BuJ2R1_SKWUhpMKifCcbRwtF1pyAhR8Q9TGjn_FAAUEXeZ8HPaowQkgUiBLwdDsP748DN6bWF-IR/s320/happy.png" width="320" /></a><b><span style="color: #38761d;">The net benefit of this modification to Alfred is a saving of $975.87/mo during the first 5 years and a saving of 845.56/mo after that.</span></b><br />
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Thus, no matter what interest rate the loan is temporarily reduced to, the end result is that <b>everyone will pay the ceiling rate (at the time the loan mod applications was approved) after 5 years</b><span style="color: red;">. </span>Fortunately, the ceiling interest rate is low enough that most people won't complain.<br />
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<b>If you are a Washington State resident</b> who needs assistance reaching out to the bank, my office represents homeowners in foreclosure mediation, where we are able to apply for a loan modification directly with the lender. This reduces communication congestion and paperwork nightmare that most borrowers go through during the loan review process. Mediation also allows lenders to look at alternative loan modifications. Since only attorneys and HUD Counselors can refer homeowners to mediation, homeowners are advised to speak to one ASAP since timing is crucial to a successful mediation.<br />
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Contact <a href="http://www.arrowlawgroup.com/">Arrow Law Group</a> at (206) 467-1785</div>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-32966344020235785702012-06-12T23:19:00.003-07:002012-08-23T13:56:13.627-07:00How lawyers help in car accidents - Washington StateYou're driving down I-5 on a sunny Monday morning. Traffic seems to be flowing smoothly at 60 mph. Suddenly, you notice the car in front of you stopped with its brake lights on. You try to change lanes, but there's no time---plus cars around you are going too fast. Being a defensive driver, you've left enough room to slow down and and eventually stop. Just as you release a sigh of relief, the driver behind you slams his car into yours, and your car is suddenly forced forward into the car in the front. You find yourself involved in a car accident. Although a little sore, everyone manages to get out of their cars to exchange information.<br />
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<table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: left; margin-right: 1em; text-align: left;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhsUcZjZhmAKDA5Tk0Es-0BKijw3Oer3fnhkACKOMybeuVou-hCIkZPESQmFpdy2MN_jkyi3kMcHza36vug5m6rW9zS_aNetTyfxtS4y6PgfnDe1HBnCjds3pthLmLFpRf73yEF4fEpxWIj/s1600/tj1e2Auto_Accident.png" imageanchor="1" style="clear: left; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" height="135" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhsUcZjZhmAKDA5Tk0Es-0BKijw3Oer3fnhkACKOMybeuVou-hCIkZPESQmFpdy2MN_jkyi3kMcHza36vug5m6rW9zS_aNetTyfxtS4y6PgfnDe1HBnCjds3pthLmLFpRf73yEF4fEpxWIj/s200/tj1e2Auto_Accident.png" width="200" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><b>Washington State<br />Auto Accident Lawyers<br />(800) 854-6967</b></td></tr>
</tbody></table>
Later, you find out that the reason why the car in front of you stopped was because she ran out of gas, and her vehicle stalled. The car behind you was going with the speed of traffic and was caught off-guard by your sudden stopped vehicle on the interstate.<br />
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Who is at fault? Even though everyone is clear on the question of fact, liability is a question of law. Surprisingly, we have handled multiple cases with facts similar to the ones above. Having multiple parties (and their insurance) all pointing fingers at each other makes it tough.<br />
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Since Washington is a comparative negligence state, the law apportions fault among all the parties. It's possible that the lady who failed to put enough gas in her car is only legally 65% at fault, and thus, can only be liable for 65% of the total damage to others. As lawyers, we put a lot of time in negotiating fault to obtain the highest award to our clients. If necessary, we will put a case before a court to decide.<br />
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We also find that those who try to handle their own personal injury claims without a lawyer will end up settling for less money than those who <i>started</i> the case with a lawyer. This is usually because auto accident victims are usually unaware of the value of their claim; and therefore, they are unprepared to fight for more.<br />
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If there are passengers in the car, please do not consider trying to settle the auto accident claims for others. Do get competent legal advice. And if you do decide to hire a professional to handle your injury claim, it's best to meet with one earlier in the case to obtain the best result.<br />
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Arrow Law Group is a Seattle based law firm. We handle personal injury and auto accident claims from all over the state.Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.comtag:blogger.com,1999:blog-6866292693155834725.post-53739177575555176342012-05-09T10:32:00.001-07:002012-05-09T10:32:16.715-07:00Amendments to the Foreclosure Fairness ActWashington's Foreclosure Fairness Act is being amended and will take effect in June 2012. Among the changes include a new timeline and additional requirements for both the borrowers and lenders. The new rule will require a <em>Notice of Default<strong> </strong></em>before mediation can be initiated. And it will allow extra time to request mediation. Currently, once the <em>Notice of Trustee's Sale</em> has been recorded, the borrower loses the right to mediation. That will change.<br />
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Some things will remain the same though. The statute still requires a HUD Counselor or Attorney to refer borrowers to mediation; borrowers cannot simply apply for, or refer themselves to, mediation. Given the lengthy statutory requirements that both sides have to comply with, most borrowers will not want to tackle this on their own. This is the borrowers <strong>one last chance</strong> to directly discuss workout options with their lender. Borrowers are expected to know what is required and to comply with the law.<br />
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Since the Foreclosure Fairness Act was enacted last year, our office has represented numerous clients in mediation and other debt relief proceedings. If you are facing foreclosure and you cannot get help from the lender, <strong>do not wait!</strong> We can only apply for relief under state law <strong>before</strong> a foreclosure is scheduled.<br />
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<a href="http://www.arrowlawgroup.com/">www.ArrowLawGroup.com</a>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-12607986150709345842011-08-21T22:16:00.000-07:002011-08-21T22:16:14.826-07:00Foreclosure Fairness Act<div class="separator" style="clear: both; text-align: center;"><a href="http://www.arrowlawgroup.com/bankruptcy/house.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="http://www.arrowlawgroup.com/bankruptcy/house.jpg" /></a></div><br />
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I'm sure, by now, you all see news about foreclosure increase and home prices dropping on a daily basis. Washington State legislators responded to the foreclosure crisis by changing the way banks foreclose.<br />
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Washington State passed the Foreclosure Fairness Act, which went into effecton July 22, 2011. The new law will allow borrowers more time and a better chance at seeking a work-out solution with lenders to avoid foreclosure. Particularly, the new law requires banks to physically sit down and talk to borrowers before foreclosing. Without this new law, lenders often refuse to slow down the foreclosure process even if there was a possible way to avoid it. Keep in mind that foreclosure in Washington can occur within 6-7 months from a default (missed payment). Now, lenders will be required to slow down the process by a month or two and review alternative options.<br />
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More information on the Foreclosure Fairness Act: <a href="http://www.webwire.com/ViewPressRel.asp?aId=143539">http://www.webwire.com/ViewPressRel.asp?aId=143539</a>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com0tag:blogger.com,1999:blog-6866292693155834725.post-87293098554294806012011-03-19T23:51:00.000-07:002011-03-20T00:40:28.352-07:00What debts are dischargeable in bankruptcy?<div style="text-align: left;"><span class="Apple-style-span" style="font-family: inherit;">I probably meet at least a handful of new clients on days our office in Seattle conduct consultations, and one of the most common questions that come up with is, "Can this be discharged?" Through experience, I can easily identify dischargeable debts from non-dischargeable debts on the spot. But I can imagine that to average consumers, this area of law can be a bit foggy.</span></div><div><span class="Apple-style-span" style="font-family: inherit;"><br />
</span></div><div><span class="Apple-style-span" style="font-family: inherit;">First, here is what the Bankruptcy Code says a discharge is:</span></div><div><span class="Apple-style-span" style="font-family: inherit;"><br />
</span></div><div><span class="Apple-style-span" style="font-family: inherit;">11 U.S.C § 524(a)(2) states that "A discharge . . . <span class="Apple-style-span" style="line-height: 18px;">operates as an injunction against the commencement or continuation of an action, the employment of process, or an act, to collect, recover or offset <u><b>any</b></u> such debt as a personal liability of the debtor, whether or not discharge of such debt is waived. . ."</span></span></div><div><span class="Apple-style-span" style="line-height: 18px;"><span class="Apple-style-span" style="font-family: inherit;"><br />
</span></span></div><div><span class="Apple-style-span" style="line-height: 18px;"><span class="Apple-style-span" style="font-family: inherit;">And of course, we have <b>exceptions to a discharge</b>, which is found in 11 U.S.C. § 523. This section has a long list of the types of debts that are not dischargeable. Among those are student loans, certain types of taxes, government fines, child support arrears, personal injury claim as a result of a DUI, debts incurred by fraud, etc.</span></span></div><div><span class="Apple-style-span" style="line-height: 18px;"><span class="Apple-style-span" style="font-family: inherit;"><br />
</span></span></div><div><span class="Apple-style-span" style="line-height: 18px;">Next, I'll explain what this all means. A discharge order acts as a Federal court order against creditors from collecting debts that were deemed discharged. </span><span class="Apple-style-span" style="line-height: 18px;"><u>All</u> debts are considered dischargeable <u>unless</u> it fits in one of the types listed in the "exceptions to discharge." Usually, this means that all medical bills, credit cards, personal loans from friends and family, mortgages, and car loans are all dischargeable in bankruptcy. Speak to an attorney if you have car loans or a mortgage because there is more to discuss than I can go into in this post.</span></div><div><span class="Apple-style-span" style="line-height: 18px;"><br />
</span></div><div><span class="Apple-style-span" style="line-height: 18px;">If you are in Washington State (or in Seattle-area) and would like to schedule a free bankruptcy consultation, please call our office. We recently added a new paralegal to our team. More to come about our staff soon!</span><br />
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<div style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhPMh7GxW6myTOiyjso4QIzIVn_4wsu0G5YC2og2Z5yHRKAf51ad1dDpk9IIQEaVKamvFgobrbD986KCYvtqkrKZru41CVU_DdA6rmzIc0mNeHJ3FXMy3G0_SOhmdP_8DgH-O5df6dkqwRW/s1600/arrowlawgroup.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="213" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhPMh7GxW6myTOiyjso4QIzIVn_4wsu0G5YC2og2Z5yHRKAf51ad1dDpk9IIQEaVKamvFgobrbD986KCYvtqkrKZru41CVU_DdA6rmzIc0mNeHJ3FXMy3G0_SOhmdP_8DgH-O5df6dkqwRW/s320/arrowlawgroup.jpg" width="320" /></a><span class="Apple-style-span" style="line-height: 18px;"> </span></div></div><div><span class="Apple-style-span" style="line-height: 18px;"><br />
</span></div><div style="text-align: center;"><span class="Apple-style-span" style="line-height: 18px;"><a href="http://www.arrowlawgroup.com/">Arrow Law Group</a> | 1904 3rd Ave Ste 930 | Seattle, WA 98101</span></div>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com4tag:blogger.com,1999:blog-6866292693155834725.post-46780630271254340822010-12-30T20:07:00.000-08:002010-12-31T13:37:21.721-08:00Effect of filing bankruptcyContrary to popular belief, filing for bankruptcy is <u>not</u> credit suicide. The fact that many people who file for bankruptcy already have less than perfect credit generally leads to an <i>increase</i> in their credit score after they file for bankruptcy. For years, creditors and collection agencies, who abhor bankruptcy, spread the idea that bankruptcy is the end all of your credit life. Working in the industry, I've seen people's lives <u>improve</u> drastically after bankruptcy.<br />
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For people with unmanageable amount of debt, there are several reasons why filing for bankruptcy is a good thing.<br />
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First, it provides a definite time line for relief. Credit card companies make money on the minimum payments and late charges that people can only afford to pay; we all know that by paying only the minimum payments, it could take 30+ years to pay off a small debt. You basically enslave yourself with debt for 30+ years. Bankruptcy can break this ball and chain and allow you to actually work toward a better future.<br />
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Second, you can only benefit from a Chapter 7 bankruptcy once every 8 years. This means that after you've filed, you are considered lower risk customer to creditors. In fact, people report receiving a crazy amount of credit card offers within months of filing for bankruptcy. Although getting back into debt is an easy way to build up credit, it's also a debt trap. In 2005, Congress reformed the Bankruptcy Code. One of the many changes include mandatory credit counseling and financial management classes before someone can file for bankruptcy. It was designed to curb the number habitually filers. It's too early to see if credit counseling is working since people who filed after 2005 aren't eligible to file again until after 2013 (since one can only file a Chapter 7 once every 8 years).<br />
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Third, credit reporting bureaus generally suppress reportings after a bankruptcy case is filed. This means that your credit score can only go up after a bankruptcy--so long as you act responsible with future credit. From experience, credit scores are usually around the mid-600s one year after filing. The ideal score would be around 700 and higher. 800 or higher is considered supreme, but even those with "perfect credit" don't have scores in the 800s. *Note: Nobody starts at 800, you have to earn it over a long period of time and credit.* Bankruptcy is only a <u>one time</u> hit on your credit report. Everything you do after that can substantially improve your credit.<br />
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Fourth, the Fair Credit Report Act requires credit bureaus to remove a "bankruptcy" mark after 10 years. This means that after 10 years, the only way anybody would know that you have filed for bankruptcy is if you tell them or they search bankruptcy court records. Even so, after 10 years, if someone can't obtain credit, it's probably not because of the bankruptcy.<br />
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People fear bankruptcy for the wrong reason. It is <u>not</u> a credit suicide. It is, at worst, a <i>temporary </i>obstacle to getting back into debt, and at best, fresh start at life with a clean slate and no stress.<br />
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Happy new year everyone!Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com9tag:blogger.com,1999:blog-6866292693155834725.post-4014209256569969722010-12-23T23:21:00.000-08:002010-12-23T23:21:42.941-08:00How does it all just go away?A client asked me this the other day. It didn't occur to me until the client kept repeating the question that bankruptcy is something both scary and almost unbelieavable. Why would anyone EVER let someone borrow money if there is a possibility that the debt may NEVER be paid back under the law? The answer is simple--Capitalism is all about risk. The government encourages banks to lend money and allow them to make a profit by betting on their customer's future. It also encourages people to take risk, big risks, to better our society. And when one fails, the government provides a mean to hit the 'reset' button and start over. Indeed, we almost lost GM if it wasn't for this policy.<br />
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When it seems like life is impossible to go on and debt is keeping life from progressing, bankruptcy may be the relief valve that one needs. Bankruptcy law allows a judge to order a discharge of any debt. A discharge is an injunction, or restraining order, against creditors. It is an order to cease ALL collection action against the debtor and it last forever. Some debts are not dischargeable, such as child support, certain tax debt, and government fines, but a majority of all debts are indeed dischargeable. And just like that, debts simply just go away.<br />
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Merry Christmas!Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com30tag:blogger.com,1999:blog-6866292693155834725.post-22233794820489105052010-12-11T21:05:00.000-08:002010-12-11T21:59:44.604-08:00Reasons why people get into debtWith the holiday coming around, we all have a lot to be thankful for. It's a season where shopping, eating, and family are celebrated among love ones. Not surprisingly, my office usually slows down around this time of year because people are trying to stay positive and cheerful.<br />
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Reading some of the comments from my previous posts, there might have been some misunderstanding because I feel like I might have inadvertently misled some readers into thinking that debt issues/problems only occur to people who are irresponsible with their money or overspend. While there is some truth to that belief, the <b>number one</b> reason why people file bankruptcy in the United States is for medical reasons. This shouldn't come as a surprise since the U.S. still has a long way to go on health care policies.<br />
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Unless employed with a financially-sound company that subsidizes health insurance, health insurance is prohibitively expensive to many people who have to buy their own. Those with health insurance through their employer typically pay $40 per pay check toward health insurance; the employer pays the other $300-400. This causes a problem to those who are either unemployed or work for a company that can't afford health insurance for its employees. These folks can't afford to pay for health insurance. One bad health incident can lead to a life-time worth of debt.<br />
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The <b>number two</b> cause of debt issues is change in circumstances. Divorce, unemployment, market changes, etc. can transform someone who was making six-figure income into someone who depends on public assistance to pay rent in a matter of months. It is natural for humans to be financially optimistic about ones future. People borrow money to survive until the worse is over... unfortunately, creditors can't wait.<br />
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As you can see, the top two reasons that people go into debt have nothing to do with being irresponsible with money or living beyond one's means. Life is full of surprises, some will leave you debt! <br />
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Happy holiday everyone!Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com51tag:blogger.com,1999:blog-6866292693155834725.post-67591193597429887522010-12-05T11:07:00.000-08:002010-12-11T21:06:55.553-08:00What happens when you don't pay your bills...<div class="separator" style="clear: both; text-align: center;"><a href="http://www.arrowlawgroup.com/creditcard.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" ox="true" src="http://www.arrowlawgroup.com/creditcard.jpg" /></a></div><br />
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Every day in the office, I get calls from frantic people who wonder why their pay checks are being garnished. A wage garnishment is an order from the court (called a 'writ') that orders the employer to withhold a portion of the employee's paycheck. The employer is then ordered to send that withholding to the creditor. In Washington state and many other states, creditors are allowed to garnish up to 25% of the debtor's net pay (after taxes). To someone who makes $45,000/year (gross pay), it could mean $800/month is garnished.<br />
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<b>How does this happen?</b><br />
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The collection process is pretty standard. When you stop making payments toward your debt:<br />
<ol><li>You'll get calls and letters from the bank telling you that you're delinquent.</li>
<li>After 2-3 months without success, the debt is sold to a collection agency (aka "third-party creditor").</li>
<li>Depending on how aggressive the collection agency is, the debt can either be sold to another collection agency or simply assigned to a local attorney to enforce the contract.</li>
<li>If the attorney takes the case, he/she will file a lawsuit against the debtor.</li>
<li>In most cases, the debtor has no legal grounds to fight the lawsuit. If so, the court will grant a judgment against the debtor.</li>
<li>The creditor then takes the judgment and ask the court for a 'writ of garnishment'. The writ is served to the employer and garnishment begins.</li>
<li>The creditor may <u>also</u> ask the court for a 'writ to levy' (or 'writ of attachment'), these terms varies depending on the state. This writ essentially allows the creditor to seize assets to satisfy the debt. To a certain extent, creditors can levy automobiles, jewelry, cash, gold, etc. In Washington, creditors can clean out a debtor's bank account, as long as the creditor leaves the debtor with at least $200.</li>
<ul><li>One law firm in Bellevue, WA experienced a backlash from a debtor it had to garnish: <a href="http://www.q13fox.com/news/kcpq-061510-axevandal,0,4567701.story">http://www.q13fox.com/news/kcpq-061510-axevandal,0,4567701.story</a></li>
</ul></ol><b>How do you stop a garnishment?</b><br />
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This is a tough question to answer. A writ of garnishment/levy/attachment are all considered valid court orders. They are issued by a state court, and therefore, can only be defeated by a federal court order. A Bankruptcy filing <i>automatically</i> triggers a federal court order to stop collecting debt. 11 USC § 362(a). People cringe when I tell them that their only option is a bankruptcy, but this is the only means to force a stop to garnishment (without fighting the creditor). I do understand that it has to do with self-pride and despair. Because of that, I approach each case with delicately and with compassion. I do understand that <u>nobody</u> wants to file bankruptcy, even if it means a brighter future. I'm not excited when I tell people that bankruptcy is their only option. But I do remind them that I understand their situation and that it's a personal choice; I'm there to help.<br />
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<span style="color: #999999;">Arrow Law Group, PLLC | 1904 3rd Ave, Suite 930, Seattle, WA 98101 | </span><a href="http://www.arrowlawgroup.com/"><span style="color: #999999;">www.ArrowLawGroup.com</span></a>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com41tag:blogger.com,1999:blog-6866292693155834725.post-88384787142283247052010-11-21T12:03:00.000-08:002010-11-21T15:21:52.477-08:00Your right to walk way...<div style="text-align: left;">*edit*</div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgB_rQCHZuA0A8tMGO_O-MGorEmv2_bqevO_fz18eUXnk56Z-fygul9Vi3osX2MEBzCtdUzm-LSZ5fv_rqGSREP9vfFReaP3uOZu-9gqlsGntAt-84hqWtacM0uzT3pTHMFMPLvowZ6ZYMY/s1600/Po-po.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgB_rQCHZuA0A8tMGO_O-MGorEmv2_bqevO_fz18eUXnk56Z-fygul9Vi3osX2MEBzCtdUzm-LSZ5fv_rqGSREP9vfFReaP3uOZu-9gqlsGntAt-84hqWtacM0uzT3pTHMFMPLvowZ6ZYMY/s320/Po-po.png" width="240" /></a></div><div class="separator" style="clear: both; text-align: center;"><br />
</div>Something that isn't taught in American schools, surprisingly, is your American right to exercise fundamental rights without government interference. My favorite is the 4th Amendment right against <i>unreasonable search and seizure without a warrant and probable cause</i>. This is a right that puts citizens on equal playing field with the government. As such, the government rarely institute the teaching of this right, no matter how fundamental it is.<br />
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I spent 3 weeks in law school and one summer internship to master the 4th Amendment. I'll do my best to <i>briefly </i>summarize it in this post.<br />
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The 4th Amendment states in part that, "The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, <b>shall not be violated</b>, and no Warrants shall issue, but upon probable cause..." This Amendment says that the government cannot <i>unreasonably</i> seize or search a person, their home, papers, and effects (which means communication including mail and telephone) without a warrant and probable cause.<br />
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<b>When and what is a seizure?</b><br />
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Even though many of you might not know it, you have probably been seized before. A person is seized when he/she does not feel free to walk away. The police can seized someone either by a show of force or physical restraint. By this definition, every traffic stop is a seizure! Certainly nobody feels free to walk away (or leave) when lights and sirens are coming from behind.<br />
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<b>What is required for a seizure?</b><br />
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The Constitution says that no <i>unreasonable </i>search without a warrant and probable cause. This has been interpreted by the Supreme Court to mean that reasonable searches are okay. So what is a reasonable search?<br />
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In the famous case of <i>Terry v. Ohio</i>, the Supreme Court ruled that if the police has <i>a reasonable suspicion that a crime is afoot </i>or <i>a reasonable suspicion that the suspect is armed and dangerous</i>, the police can conduct a <i>reasonable</i> search. In that case, a police officer spotted some guys walking around and looking into store windows. The officer approached the suspects, flipped them around, and frisked them for weapons. When he discovered a gun, he arrested them. When it came time for trial, the defendants questioned whether the cop had a right to stop and search them without a warrant or probable cause. The Supreme Court ultimately allowed this search, deciding that the government's interest outweighed the defendant's individual privacy interest.<br />
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The Court was careful in applying this search. This search is limited to the pat down of the suspects outer clothing and can only last so long. This has been known as the <i>Terry Search </i>or the "Pat Down." This is the only known search allowed where the police does not have probable cause that a crime has been committed and no warrant is present.<br />
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Later, the Court applied the <i>Terry Search</i> to cars in <i>Michigan v. Long</i> and to homes in <i>Maryland v. Buie.</i> Over the years, the Supreme Court has expanded its interpretation of the 4th Amendment to say that an unreasonable search without a warrant <i>can</i> be allowed in <i>limited</i> circumstances. I won't elaborate on every exception (such as exigent circumstances, to preserve evidence, incident to an arrest, etc.), but I will talk about one exception called "consent."<br />
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<b>Consent</b><br />
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The police can <i>always</i> search a person upon consent. Consent must be knowing, intelligent, and voluntary ("KIV"). Even though refusing consent <u><b>cannot</b></u> give rise to any probable cause, this is the number one reason why people consent to searches. For example, a police officer pulls you over for speeding, and you have a kilo of cocaine in the trunk (that you took from your drug-addict brother in an intervention). The officer says, "do you mind if I look in your trunk?" <b>What do you say?</b><br />
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Most people feel that if you say no to the popo (pissed off police officer) that he'll think that you're hiding something, so they voluntarily give the police permission to search the trunk! Next time you watch COPS, pay attention to the people who voluntarily give consent to a search. The Court is clear that refusing to give consent, alone, is not enough for the police to get a warrant to search. So next time you have cocaine in your trunk, don't let the popo search it!<br />
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There are other exceptions such as the "plain-view" doctrine which says that if the police can see something in plain view (like through your car window), that it is okay for the police to use it as evidence.<br />
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<b>What happens if the search is improper?</b><br />
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<b></b>If the police violates your 4th Amendment right to obtain evidence, then that evidence cannot be used against you in the court of law. Criminal defense attorneys heavily rely on this defense to exclude harmful evidence. When I was in Michigan, East Lansing Police used to walk up and down sidewalks and ask people to take breathalyzers. Based on the results, people could get charged with a "Minor in Possession" of alcohol. Anyone who refuses to take the breathalyzer was charged a $100 fine. The Court eventually held that it was an unconstitutional search because (1) simply walking on a sidewalk cannot be enough reason to seize someone and (2) consent was not voluntary. As a result, the breathalyzer results couldn't be used to charge anyone with an MIP. No evidence, no crime.<br />
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*Please remember that refusing a breathalyzer if you are driving a car could result in your license being suspended. This is because you consented to this search when you got your license.*<br />
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I'm not sure what the lesson here is, except that you should <i>never</i> consent to a search of your trunk if you are hiding cocaine in there.<br />
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<a href="http://www.arrowlawgroup.com/">www.ArrowLawGroup.com</a> | Attorneys at Law | Seattle, WAMinh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com39tag:blogger.com,1999:blog-6866292693155834725.post-91356600616620794592010-11-07T00:59:00.000-07:002010-11-07T01:07:29.782-07:00How Bankruptcy Can Stop Foreclosure<div class="separator" style="clear: both; text-align: center;"><img border="0" height="238" px="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjFT4tFawgs6iDI2JuOfsqRdOc7Zb2oKnPGWeCt9wW0fizrbWvFolT4QB-BWq63MEl1RR_iKqXjdkuS6C84xZBdbtMTzOeirfSAM8M44xw-GuzWgw5LqXIJkwjW4gK1v6WSkOicpUh72v79/s320/foreclosure.jpg" width="320" /></div><br />
Bill and Jill are happily married. They both work, make decent money, and pay their bills on time. They own a home together and have never been late on a payment. Financially, it appears that Bill and Jill are going to do quite well. Unfortunately, neither Bill nor Jill was immune the economic storm that swept the globe. <br />
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Bill received a letter from his boss that his job position might be eliminated and Jill's hours are being reduced because budget cuts. Like many Americans, Bill and Jill have financially planned by saving up money. Months go by, and Bill is worried that their planning didn't cover this long of a "recovery". Bill's job is becoming less secured and Jill's hours are now reduced to half of what it used to be. They've exhausted a majority of their savings, 401k, and IRA to keep up with monthly bills, including their mortgage. Inevitably, B & J run out of cash and start to fall behind on their mortgage. Several months go by, and B & J now have a foreclosure notice.<br />
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Later on, B was offered a new job with a different company. This one pays only a little more money, but it was enough that B & J can make their monthly mortgage payments. However, the bank won't stop the foreclosure process unless B & J catch up on all of their late payments. There was simply no way that Bill can pay several month of late mortgage payments to cancel the foreclosure. The bank refuses to work with Bill and told him that it will auction the house off in 90 days. What can Bill do to save his home?<br />
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Sadly, it's not a very well known fact that a Chapter 13 Bankruptcy <u>can stop a foreclosure</u>. A Chapter 13 Bankruptcy is the type of bankruptcy where the debtor sets up a plan to repay a portion of his/her debts. If the Plan meets all the requirements for court approval, a bankruptcy judge signs the plan into an order. The order prevents the bank from foreclosing on the debtor's property while he/she is making payments.<br />
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In a home-saving situation, the Chapter 13 plan will include a provision that requires total payments of <u>all</u> late mortgage payments. The debtor has up to 5 years to pay up the late mortgages. While he/she is making the payments, the bank is not allowed to foreclose on the property <u>based on these late payments alone</u>. <br />
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For example, if Bill's monthly mortgage payment is $1,000 and Bill is 5 months behind, his mortgage arrears is $5,000 ($1,000 x 5 months). In order to prevent the bank from foreclosing, Bill can either (1) pay the bank $5,000 to get caught up <strong>or</strong> (2) file a Chapter 13 and pay off the $5,000 over 5 years ($83.33/month). As long as Bill is paying his ongoing monthly mortgage payment on time plus the extra $83.33 (paid through Court), the bank can't foreclose. This is likely how Bill will save his home.<br />
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All of this can be confusing because a Chapter 13 Plan requires a great deal of legal engineering before the Court will approve it. If you know anyone who is losing their home <u>and</u> they want to save it, you should point them to a bankruptcy attorney before it's too late.<br />
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<span style="color: #999999;">Arrow Law Group, PLLC | Bankruptcy Attorneys</span>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com46tag:blogger.com,1999:blog-6866292693155834725.post-79026194003076124122010-11-07T00:16:00.000-07:002010-11-07T00:16:32.834-07:00Daylight saving...Dont forget to change your clocks...<br />
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<span style="color: #999999;">Friendly Reminder from the Arrow Law Group Bankruptcy Law Firm</span>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com27tag:blogger.com,1999:blog-6866292693155834725.post-34625247109833751272010-11-01T06:31:00.000-07:002010-11-01T06:31:39.858-07:00Website updatedI accidentally messed up our website so I spent the last few hours trying to recode it. New website!<br />
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<a href="http://www.arrowlawgroup.com/">www.arrowlawgroup.com</a>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com34tag:blogger.com,1999:blog-6866292693155834725.post-57422188036068309832010-10-28T23:14:00.000-07:002010-10-29T01:02:03.095-07:00Freedom of Speech and Freedom of SilenceDo you ever get blogger-haters?<br />
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I get emails from friends (and my younger brother) asking me if there is anything that he/she can do because someone posted something mean or untrue on Facebook or a blog entry. The question comes down to "Is there something you can do?" Hm... let me find my legal magic wand...<br />
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The Bill of Rights guarantees the rights of Americans by limiting the powers of the federal government. The 14th Amendment applied the Bill of Rights to state government. Rather than going into details about the Supreme Law of the Land, I'll focus on <i>one</i> area that affects everyone, even non-Americans. That's the <i>FREEDOM OF SPEECH. </i>It is adopted in the United Nations Universal Declaration of Human Rights and the European Convention on Human Rights in almost mirror image.<br />
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The First Amendment states in part, "Congress shall make no law . . . abridging the freedom of speech. . ." What does this really mean? Well first off, it means that the law only prevents <b>Congress</b> from abridging the freedom of speech. Of course, today, it also applies to state government. While it looks like the law says the government can't make any law that limits the freedom of speech, we know today that it's <b>not true</b>. Over time, the Supreme Court has carved out exceptions on top of exceptions to the freedom of speech. Speech are either "protected", "unprotected" or "semi-protected". A speech that defames someone is not protected by the freedom of speech. The government can regulate or prohibit it.<br />
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Defamation is actionable (in court) when someone tells a lie about you to another person, and that lie caused harm to your reputation. This is a matter of state law, and each state has its own variation of this rule. To win, you have to prove to the court (or jury) that the "lie" is really a lie. That means that opinions (something that is unprovable) cannot be defamatory (even if its insulting). You ultimately have the burden of proving that something is not true. So let's say someone accuses you of stealing pencils from work. How do you prove that you didn't steal something that was never taken? It's almost impossible to prove a negative, so it's an uphill battle. You certainly do have a case if your former boss tells your prospective employer something untrue and that causes you to lose the job--but to prevail<b> you</b> have to prove that it was a lie (and not an opinion) to begin with.<br />
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There is an exception to the above rule. I remember it because my law professor called it the CLUB factors. If someone tells a lie that accuses you of committing a <u><b>C</b></u>rime, having a <u><b>L</b></u>oathsome disease, being <u><b>U</b></u>nchaste, or committing a <u><b>B</b></u>usiness wrongdoing, that person has the burden of proving that it's true. For example, if someone tells your boss that you have AIDS (assuming that you don't have it), and you sue that person for defaming you (and ruining your game), the burden is on <i>that</i> person to prove that it's true. If that person <i>can't</i> prove that it's true, you win. All you have to do is file the lawsuit alleging defamation. Again, some states have changed the default common law rule.<br />
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I won't go into details regarding the media because they have much more leeway. That is, they can be wrong when they report the news so long as it was an innocent mistake.<br />
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Although I'm discussing your rights here in an adversarial manner, I know that not everything calls for lawyers to resolve. As Judge Cardozo once said, even a dog can tell the difference between getting kicked and being tripped over. But certainly, see an attorney if you think you have something worth going into war over.<br />
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<b>Craigslist ad of the day</b>: <a href="http://seattle.craigslist.org/see/lgs/2031353381.html">http://seattle.craigslist.org/see/lgs/2031353381.html</a><br />
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<center> <img align="center" alt="Arrow Law Group Complete Bankruptcy Representation" src="http://www.arrowlawgroup.com/123steps.png" width="90%" /><br />
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<a href="http://www.arrowlawgroup.com/">www.ArrowLawGroup.com</a><br />
<span style="color: blue;"><b>Free Bankruptcy Evaluation (206) 467-1785</b></span><br />
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</center>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com43tag:blogger.com,1999:blog-6866292693155834725.post-31696953294037629032010-10-26T23:24:00.000-07:002010-10-26T23:30:46.387-07:00Chapter 7, 13, and what?On a typical day, I get at least one client walking into my office asking to file a Chapter 7 bankruptcy. This client had read about Chapter 7 bankruptcy on the internet and had decided that it's the way to go. I do love the internet, because its an unlimited library of knowledge and experience--shared by people across the United States who are facing the same exact situation (they're broke). Unforuntately, the law isn't the same across the United States. Accept what you read on the internet with an open mind.<br />
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<span style="background-color: white;">The bankruptcy code is Title 11 of the United States Code (11 U.S.C). Title 11, like other titles, is broken up into chapters. It's organized by categories, for example, Chapter 1 contains all the definitions. Chapter 3 contains information on starting a case. Chapter 5 contains information on debtor's duties and rights and so on. Chapter 7, 9, 11, 12, 13 defines the types of relief available. For the sake of killing everyone, I will <em>only and quickly</em> talk about Chapter 7 and 13.</span><br />
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Chapter 7 bankruptcy is the type that wipes clear <strong>all</strong> debts (except for special debts like students loans, child support, tax, etc.) This type of relief is available to businesses and people who make less than the state's <strong>median income</strong>. The U.S. Department of Justice publishes a list of median income for all 50 states, and you have to make less than the median income to file a Chapter 7. There are still ways to get around this test, but I won't go into details here. The link is found here: <a href="http://www.justice.gov/ust/eo/bapcpa/20101101/bci_data/median_income_table.htm">http://www.justice.gov/ust/eo/bapcpa/20101101/bci_data/median_income_table.htm</a> . <br />
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As you can see from this list, <u>half</u> of Washington residents <u>with a household of one</u> make less than $49,124/year. The other half make more than that. If you live in Washington, and you live by yourself, you have to make <strong>less</strong> than $49,124/year to qualify for a Chapter 7. The income calculation is convoluted and I won't go into details here. In this economy, most people I meet do qualify.<br />
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Chapter 13 is the type of bankruptcy where the debtor proposes a payment plan to the court. It requires debtors to pay back a portion of their debts. The amount of debt that someone has to pay back depends on their income. In some case, it might be all or it might be none. Chapter 13 is for those who either make <strong>more</strong> than the median income, have excess properties that can't be protected in a Chapter 7, or are trying to avoid foreclosure. Chapter 13 is complicated and I wouldn't recommend anyone taking it on themselves. (See my post on hiring a lawyer).<br />
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I had an <em>extremely</em> upset person come into my office demanding to file a Chapter 7. He was so upset at me when I told him he didn't qualify that he threatened to report me to the state bar. I told him that if bankruptcy law was easy, he wouldn't have came to me.<br />
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Sorry for the seriousness of this post. There's just no fun way to explain bankruptcy...<br />
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<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhFx7S78sQimXYNx4v0_p2TOJd8FcCALFs6dMQCbcGMx0M3nV4tDV9wcDHqd-F5xK2yBcBLQy2D7k68y76Xc2MAMqeJfIvrmDQmtJKJ8wSB_W0YTcKUxGv3TYyyos7RYULrSr-EwSfIb0BP/s1600/Waiting+area.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" nx="true" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhFx7S78sQimXYNx4v0_p2TOJd8FcCALFs6dMQCbcGMx0M3nV4tDV9wcDHqd-F5xK2yBcBLQy2D7k68y76Xc2MAMqeJfIvrmDQmtJKJ8wSB_W0YTcKUxGv3TYyyos7RYULrSr-EwSfIb0BP/s1600/Waiting+area.jpg" /></a></div><div style="text-align: center;"></div>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com23tag:blogger.com,1999:blog-6866292693155834725.post-47627840982552739042010-10-22T16:42:00.000-07:002010-10-23T01:10:16.226-07:00Do I need to hire a lawyer?This is a common question that we get at consultation. My answer is, "of course not!" Our legal system was not designed so that a lawyer is absolutely necessary for anything. However, it's highly discouraged in some area.<br />
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The law is usually written after series of compromises from all sides. The end result is a piece of legislation that attempts to be as "one-size-fits-all" as possible. Unfortunately, no matter how <em>general </em>a law is written, no one law can actually cover every single possible dilemma that comes up. Lawyers are trained to spot issues and defuse them before they become bigger issues. This requires us to dissect your case into a million pieces and piece it back together. This is why people tell me that lawyers make things more complicated. I just smile.<br />
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When people file bankruptcy, they put all of their worldly possession before a bankruptcy court. The law allows people to keep a substantial amount of property (e.g., clothes, furniture, some cash, <a href="http://www.dskjewelry.blogspot.com/">DSK Jewelry</a>), but it also requires people to <em>surrender </em>property that is more than what is considered necessary to live. For this reason, hiring a lawyer to file bankruptcy is a smart idea. Only a bankruptcy lawyer can spot <em>potential </em>issues with property. Once a bankruptcy petition is filed, it is difficult to get it dismissed. That means that you can't change your mind simply because you can't keep your brand new Corvette or that Bubbi Necklace. It's gone!<br />
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In summary, you don't need to hire a lawyer to file bankruptcy. It's extremely encouraged by the bankruptcy lawyers and also the court that you do. This is especially true if you own anything of value.<br />
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<strong>On another note, the video on the bottom relates to my practice. I file lawsuits against creditors who violate the Fair Debt Collection Practices Act by using abusive collection tactics. (See below). Call <a href="http://www.arrowlawgroup.com/">Arrow Law Group</a> if you are being harassed! (by a collection agency).</strong><br />
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Link: Debt collection abuse<br />
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<object classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=10,0,0,0" height="245" id="msnbc1236b2" width="420"><param name="movie" value="http://www.msnbc.msn.com/id/32545640" /><param name="FlashVars" value="launch=39737563&width=420&height=245" /><param name="allowScriptAccess" value="always" /><param name="allowFullScreen" value="true" /><param name="wmode" value="transparent" /><embed name="msnbc1236b2" src="http://www.msnbc.msn.com/id/32545640" width="420" height="245" FlashVars="launch=39737563&width=420&height=245" allowscriptaccess="always" allowFullScreen="true" wmode="transparent" type="application/x-shockwave-flash" pluginspage="http://www.adobe.com/shockwave/download/download.cgi?P1_Prod_Version=ShockwaveFlash"></embed></object>Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com21tag:blogger.com,1999:blog-6866292693155834725.post-80587436488720968042010-10-11T19:28:00.000-07:002010-10-11T19:28:46.909-07:00REAL ID Act -- a fake "cure"An old friend of mine complained on his facebook status that an uninsured "illegal immigrant" hit his car, and because he didn't have uninsured motorist coverage on his auto insurance, his bank account is now short a few thousand dollars (to fix his car). As I was thinking about his status update, I wasn't upset so much by the politcally incorrect usage of the term "illegal immigrant" as I was by what politicians and Congress have done to fix our immigration problem--by creatively distracting the American public into thinking that the <em>government and politicans</em> are not the source of the problem. Yet, politicians on both red and blue teams, around election time, try to pass blame to opposing parties until the issue itself is forgotten.<br />
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In 2005, President G.W. Bush signed a bill called the Real ID Act. The Real ID Act attempted to add slight reform in immigration laws, which is still considered ineffective at achieving its goals. Congress knew that reforming immigration laws would require a great deal of debate; a debate so heated that it could cost some polticians his/her career. <strong>Thus, it came up with a crazy idea... the Real ID Act</strong>.<br />
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One of the <strong>major </strong>changes in the law was that undocumented aliens (those without permenant resident status or "green card" or citizenship status) were prohibited from receiving a state issued ID or driver's license. It also encouraged states to change security features on driver's license to prevent fraud. The end result was that states began to take away driver's license from undocumented aliens and foreign citizens without green cards.<br />
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Congress actually believed that these undocument aliens, who unlawfully entered the U.S. without visas, will actually stop driving if their driver's licenses were taken away. The end result is that we now have <strong>more</strong> unlicensed drivers on the road, and we have more unlicensed <strong>and</strong> uninsured drivers on the road. <br />
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Americans are rightfully enraged! We now have people who are here unlawfully plus they are breaking more laws by driving without a license and driving without insurance!? My friend was justified for being upset. I'm upset for him, but I'm upset at Congress.<br />
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Although the Real ID Act is being praised as being one step closer to securing our borders, common sense tells me that (1) it' not working and (2) it's hurting than it's helping.Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com21tag:blogger.com,1999:blog-6866292693155834725.post-38710432312645441662010-09-19T19:24:00.000-07:002010-09-24T23:28:34.766-07:00What is bankruptcy?Before the days of America, during the reign of the English King, debtors who couldn't pay their bills were sent to prison and their belongings seized. This was known as the debtors prison. Creditors got what they could from the debtor's estate, which usually amounts to nothing. Debtors then pay their debts by remaining incarcerated.<br />
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Overtime, the English law evolved into what we now call "bankruptcy law". Through over a hundred years of legal evolution, bankruptcy today does not involve going to prison--with some exceptions, such as bankruptcy fraud. Instead, today, the law leans toward consumer protection and less on creditors retribution. U.S. bankruptcy law requires bankruptcy debtors to "surrender" a certain amount of assets and prohibits creditors from trying to go after the debtor's paycheck, bank accounts, and other assets after a bankruptcy petition has been filed. Modern bankruptcy protects consumers from losing <em>everything</em>, while allowing creditors to recoup as much of their loss as possible. It also forces creditors to back off to allow debtors space to breath, regroup, and rebuild.<br />
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<strong>Don't waste your money paying creditors if you can't afford to...</strong><br />
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The common myth that people will lose their home (or everything) when filing for bankruptcy is something cooked up by creditors to prevent people from filing. Further, the common myth that it will <em>destroy</em> one's credit was also designed to scare desperate debtors into using every penny of their life savings, retirement, and even children's college funds to <em>try</em> to pay back debts that they simply cannot afford to pay. As a result, many people who come to me for advice on bankruptcy have exhausted <strong>everything</strong> they own and is left with nothing but the clothes on their back and <em>maybe </em>their home. Before you drain your retirement account, talk to me first (or another lawyer that handles consumer debt defense)--educate yourself to save yourself.Minh Tranhttp://www.blogger.com/profile/05013056043709402818noreply@blogger.com17