Chicago Bankruptcy Lawyer Blog

Remember cash for clunkers? Well, how about rebates for refrigerators?

Uncle Sam has $300 million in stimulus money, and he wants you to buy a new fridge - or washer, dryer or HVAC, according to Chicago bankruptcy attorneys. The point, of course, is to encourage consumers to start spending - but also to replace old, outdated appliances with new, energy-efficient ones. Modern washing machines, for instance, use about half the water as their older counterparts. They also squeeze out more water during the spin cycle, meaning you'll need less energy to dry your clothes as well.

If you're in the market for new appliances, this might be the time to do it. However, it's important to weigh the pros and cons of the rebate program - especially if you're already struggling to make ends meet without a new fridge to pay for.

Continue reading "Chicago Bankruptcy Attorneys See Pros and Cons to Cash for Appliances Program" »

The word is out - the $75 billion loan modification program meant to protect homeowners from foreclosure has actually made the situation worse.

Out of the millions of Americans facing foreclosure, Uncle Sam's program modified mortgages for just a few hundred thousand - some of which ended up going into foreclosure anyway. Now critics are saying the program has worsened the crisis by leading us on. Instead of saving money for alternatives to modification or, worst case scenario, for moving to a new residence, many folks kept holding out hope that modification would save them - until it was too late.

Many homeowners simply can't afford to keep their homes - and unless they can get rid of debt or change their lifestyle, a modification that barely lowers their mortgage isn't going to make much difference. Fortunately, that's where Chapter 13 bankruptcy comes in, according to Chicago bankruptcy attorneys.

Continue reading "Chicago Bankruptcy Attorneys Say Government Loan Program Helped Make Foreclosure Crisis Worse" »

Remember that stimulus package the government enacted back in February? Well, apparently Uncle Sam got a little too generous.

It's just been announced that up to 15 million taxpayers could owe some of that stimulus money back next year. Why? Under the Making Work Pay tax credit, most working Americans had less withheld on their paychecks, resulting in extra take-home pay of about $60 a month. But when the government changed its withholding tables for the new system, it didn't factor in things like whether someone was married to a working spouse, held more than one job, was retired with income taxes withheld on their pension or was a college student still being claimed as a dependent on their parents' taxes.

So let's say you have two jobs, each one earning at least $20,000. That means you could have been credited twice - and will owe half of that money back to the government on your income taxes. If you're owed a tax refund, that refund will simply be reduced. But if you owe taxes, you'll also have to pay all that stimulus money back to Uncle Sam come April. Fortunately, there's a way to help ease the pain of such nasty surprises.

Continue reading "Some Employees May Have to Pay Stimulus Money Back" »

The economy might be recovering, but we're not out of the woods yet - especially when it comes to foreclosures.

Even though a $75 billion government anti-foreclosure program recently reached its goal of helping 500,000 folks get loan modifications, that's only one-eighth of the 4 million homeowners it originally set out to assist. And while some banks have helped more than one-third of eligible homeowners with the program, others like Wells Fargo and Bank of America have helped just 20 and 11 percent, respectively.

Now consider that millions more are facing foreclosure but ineligible for loan modification. Still, as many as half of those who receive a modification end up defaulting anyway. It's depressing stuff. But luckily, there's another government program that can save your house. It's been around for years, has been proven to work again and again and doesn't require your lender's approval - it's bankruptcy.

Continue reading "Loan Modification Program Hits Target, But Is It Enough?" »

Thanks to the new government incentive program Cash for Clunkers, we might be seeing a lot more hybrid and other low-mileage vehicles on the streets - and that's both good and bad.

It's good for the auto industry, because it spurs people to buy more cars. And it has potential to be good for the environment, if people who would have otherwise purchased a less fuel-efficient vehicle opt for a greener version. But it might not necessarily be so good for the wallets of consumers.

In summary, here's how the program works. You trade in a low-mileage vehicle for a version that gets better gas mileage, in accordance with government standards. In exchange, Uncle Sam knocks between $3,500 and $4,500 off your price tag. Looks like a great deal, right? Well, that depends. If you planned on buying that cute new Prius come hell or high water, then yes, you're getting a bargain. If you didn't plan on buying a new car - either because you couldn't afford it or didn't need it - then it's a different story. You can actually lose - rather than save - up to $4,500.

Continue reading "Consider the Real Cost of Cash for Clunkers" »