How long does a Bankruptcy stay on the books?

I have had a number of clients who have inquired into a bankruptcy ask me how long a bankruptcy will stay on their record and credit report.  And today, CNN Money answered this question:

How long does bankruptcy stay on the books?

My wife has applied for credit cards, but was denied because the credit reporting services have a record of her filing bankruptcy in 2003. Does this record stay permanent, or does it become purged after a period of time? – James V.

It depends on what kind of bankruptcy your wife filed nine years ago. Generally speaking, a completed Chapter 13 bankruptcy will stay on a credit report for seven years, and a Chapter 7 will stay on a report for 10 years. So if your wife filed Chapter 7, it'll probably hang around for another year.

Other negatives on your record — late payments, foreclosures, collections info, and derogatory public records — tend to drop off after seven years.

"The older these negative items are, the less impact they have on the score," says Tom Quinn, Credit.com's credit scoring expert, "assuming no other more recent negative items are posted."

— Kate Ashford

In other words, if you file a bankruptcy because of credit card debt, and it is granted, you can expect that for 10 years following the bankruptcy this will appear on your credit report.  Yet another reason to make sure that you no longer have any other options except to file for bankruptcy, as there are long-term implications that may follow you for a decade after the fact.

Lawmakers and Lawyers Push for Alimony Reform

Really good piece about the push for alimony reform in New York.

http://www.usatoday.com/money/perfi/basics/story/2012-01-05/alimony-law-reform/52642100/1

I have found that a lot of my divorce clients are always let down by the amount they are ordered to pay for alimony, especially when they have worked for so long and now must pay a share of their income to the other spouse. It's good to see that there is a push for reform in this area.

How to Find New Clients as a Sole Practitioner or a Small Firm

I posted this on the Lawyerist LAB, but I wanted to reprint this for anyone interested in using Nolo, whether you're a solo practitioner looking for more client leads, or even a potential client and want an easy way to reach attorneys in the practice area you need:
Lawyerist LAB — The Lawyering Advisory Board

I currently use Nolo for Family Law related matters around New York City, including Child Support, Child Custody, and Divorce.  My rate currently is $600.00 which I have been using up roughly every 1.5 months (I just had my amount updated after last paying for it around Thanksgiving).  The rate is based on what area of law you're contracting with them, and how many leads they usually get in that area per month.  Each time I get a referral, it is usually $20.00 that is subtracted from my debit account.   

How It Works: 

Nolo signed a contract with a company called “Experthub.”  They apparently own thousands of websites out there with general keyword names, such as NewYorkDivorceLawyer.net, and other related websites. Say a client has an issue, such as they simply need an uncontested divorce.  So they type into Google “New York Divorce Lawyer” and Experthub's websites will come up.  Their websites then have client contact forms, where the potential client submits their name, phone, e-mail, county, area of law, and then have an opportunity to describe the specific issue.  Once they hit send, and it is processed by Experthub, you then receive an e-mail in your inbox with the client lead, which is only sent to those law firms that have contracts in the county where the client resides, and in the area of law that they designated.  Once you receive the lead, what you do is then up to you.  If it sound like a potentially good lead, you can give the potential client a ring to talk about the issue and hopefully set up an appointment.  If it sounds like a dud, or a losing case, simply ignore the lead.  In either case, once the lead is generated and sent to you, you have the price per lead subtracted from your debit.   

The Good:

I have found that more than 2/3rds of my leads have at least been positive leads.  Every so often it is a dud lead, but the amount that work out, and are paying clients, definitely outweigh the ones that do not work out.  There is also the fact that the leads generated are to a small amount of lawyers.  They only sign contracts with 4 lawyers, per county, per area of law.  So in your main practice area, it means you have at most, three other attorneys who are getting that lead.    Since I can often be quite busy throughout the day, whether it is court appearances, or even just communication with other clients, I sometimes don't have time to immediately contact every single lead the second I get them.  However, I have a part time assistant who is usually available all day long to make the lead inquiry, so the second I get the referral to my inbox, I immediately forward it to my assistant, and she will make the call almost immediately.  She also has my calendar synced with her calendar, so she can easily check to see when I'm available to have an appointment with the client. She will try and make that appointment immediately so I can at least get the client through the door.   

The Bad: 

The first thing that I think a lot of people immediately see as a potential issue, is that you're still paying for a referral that if you're not as quick as the potential three other law firms, then you just paid for a lead that you lost because the other law firm was faster than you were.  This service seems to reward the quickest law firms, or the ones who are the most available to respond to inquiries.  There are also very limited ways that you will ever be credited back a bad lead.  For example, just last week, I received a lead from Nolo and before I could even forward the lead to my assistant, the client actually called me first, after finding my firm on Lawyers.com.  So I would have been able to get that client without the referral, but you have to pay for it anyway.    I would note however, that Nolo is great about refunding you if you get a duplicate lead.  About 2 months back I received 2 leads sent to me just 10 minutes apart, sent from the same client.  Nolo caught this even before I called them about it, and credited me the duplicate leads.      Additionally, the bad leads can be quite frustrating sometimes. Whether it is a client who just wants free legal advice or an answer to their legal question, or whether it is the client who makes an appointment with you, and then no-calls, no-shows, the bad leads are just….bad.   

The Verdict : 

If you are a solo or small firm practitioner, and are looking for a new and relatively cheap way to get more clients through your door, Nolo is the way to go.  Just one paying client can cover the entire month's cost of using the service, and in my experience, I have been able to retain at least 10 a month from Nolo, if not more.   All the staff I have had to deal with have been very accomadating, and even check up on me every so often to see how my law practice is going.    Unless you're content with the number of clients you have or are able to generate without Nolo, I highly reccommend Nolo to every solo or small firm out there.

And for those interested in getting direct contact with Nolo, I highly recommend my personal campaign representative who I have been using since August when I first signed onto Nolo.  His contact information is:

Daniel Haight
925-962-9188
510-704-2316
dhaight@nolo.com

And no, I don't get any money each time I refer someone to him.  Simply put, I have just been that satisfied with the job Nolo has done to help me find clients that I want to help spread the word to other Solo practitioners and small firms that could use a nice influx of new clients. 

Add Ons to Child Support

So here you are, finalizing your divorce, and you notice that your spouse is not only asking for weekly payments for child support, but wants additional payments for other costs such as:  private school tuition, tutors, swim lessons, any and all associated medical costs of the children, and pretty much any cost that can be associated with your childen.  So you start thinking:  "Hey!  What happened to just paying regular child support checks?  What are all these other costs that I have to pay for?"  These, my friend, are called "Add Ons for Child Support."  

 

First of all, let's make sure we differentiate between "basic child support" and "add on support."  Basic child support is the percentage calculated according to New York State Domestic Relations Law for support based on a parent’s income.  However, "Add on support" is additional support for other costs such as:  health insurance and unreimbursed medical expenses, some educational costs, and daycare. 

To calculate what each parent has to pay for "add on" child support, each parent must look at each cost incurred and then apply what their pro rata share is for the expense.  For example, if each parent earns $50,000, each would pay 50% of the add on costs.  If one parent earns $20,000 and the other earns $80,000 they would pay 20% and 80%, respectively, of the add on costs.  These percentages are often included in a divorce stipulation or agreement, as they are additional costs beyond simply what a parent would have to pay under the law.  

Currently, parents can deviate from their pro rata shares of the add on child support, but their agreement or the court order must specify their reasons for the deviation.  The parties may also agree to include additional “add on” support categories, such as the cost of camps and extracurricular activities for their children. 

Domestic Relations Law §240 (1)(d) provides that the cost of the health care insurance premium must be paid by the parties in accordance with the pro rata shares.  Domestic Relations Law §240 (1-b)(c)(5) provides that reasonable health care expenses that are not covered by insurance, i.e., unreimbursed medical expenses, are allocated in the same proportion as each parent’s income is to the combined parental income.  In determining which parent should carry the insurance for the children, the Court normally investigates who is offered insurance by their employer, the comprehensiveness of the insurance offered, and the cost of such premiums.  In most cases, the children will remain covered under the better health care plan, although not in every situation.  

Domestic Relations Law §240 (1-b)(c)(4) and Domestic Relations Law §240 (1-b)(c)(6) provide that a "custodial parent who is working, is looking for work, or is in school or training which will lead to employment and incurs reasonable day care expenses, such expenses must be paid by the parties in accordance with the pro rata shares." 

For parties who agree that their children will attend private school, or whose children have been enrolled in private school prior to the commencement of a divorce action, they may be obligated to pay these educational expenses in accordance with their pro rata shares.  These often must be paid on a weekly or monthly basis, in addition to the child support payments that were ordered or agreed upon.  

 

Also keep in mind that "education" expenses will often times expand beyond just the direct costs of attending school.  As mentioned above, these include tutoring, activities, sports, or even a private driver if doing so is necessary for the safety of the children.  

The main thng to keep in mind through your divorce and when preparing your divorce agreement, is that if you allow "add ons" to be included in child support, your required payments might be much much higher than what you initially imagined.  

Related articles, courtesy of Zemanta:

• Voluntary Underemployment and Child Support: Armbrister v. Armbrister
• How Can a Divorcing Woman Get the Child Support, Alimony She is Owed?

Lessons Learned From a Hard First Year of Solo Law Practice

I have a couple more months before I write one of these, but I'm already noticing a lot of similiarities to what I have found.  You can find the full article here:

Lessons Learned from a Hard First Year of Solo Practice

So perhaps I should just repeat some of the biggest realiziations I have had after 6 months of true full time solo practice:

First and foremost, I learned that I can do this! 

I learned not to waste money on marketing.

I learned not to waste money on other things, too. Like memberships to networking groups, ads in local home & leisure publications, and fancy extras like all the add-ons my phone company offered me or hiring a decorator to fix up my office. 

I learned where my leads actually come from. I get at least half of my clients from referral sources like other attorneys and existing clients. 

I learned how to get clients through my website. You want better SEO? Translation: do you want your website to stand out on Google? Learn some basic ins and outs of how the Internet works. Use a back-end to your website like Joomla or WordPress that automatically handles it for you.

I learned how much money I need to stay afloat. I wrapped my head around my own cash flow.

I learned that I can do it all myself, but that I don’t have to. I’m no longer a one-man band.

Finally, I learned to love my life, right now, just as it is. My life is not perfect, don’t get me wrong. It would be nice to be a little more profitable, but the firm is beginning to thrive. 

So I will certainly update this again along the way, but I think these points are great.  

You know, I recently spoke to a friend from law school about going into my own practice.  He certainly had some ambivilance and worry about how it work out and whether he could afford to do it.  I told him that I could not recommend more how easy and rewarding it is to run your own practice.  So here I am , the end of December 2011.  Back in the beginning of August, 2011, I didn't have a website, nor had I ever had more than 2 clients at a time.  Now, I have more than 25 currently retained clients in a multitude of practice areas, and every week I get more calls.  

And you know what?  Ultimately, I did it all on my own.  

When Forensics Examiners Help Win Child Custody

When there is a disagreement over child custody, often times the family court judge or referee will order an outside forensics study be made. This is an depth examination of both parents, their jobs, living arrangements, and what may be the best interest of the child.

For a further read this article covers it pretty well :

Engaging Forensic Examiners to Strengthen Your Custody Case

It's important to remember though that forensics are supposed to be done on an independent basis, but often times who is selected and the report they give can have a huge impact on your child custody case.

When Baby Boomers Get Divorced

From my personal experience of being a divorce attorney, I have noticed that perhaps more than 50% of my clients have been around the Baby Boomer age.  Meaning, a number of my clients are already retired, or close to retirement, and are involved in a divorce proceeding. 

Recently Abrams and Festerman posted an article discussing this new trend, which you can find here:

http://www.abramslaw.com/CM/Articles/Articles304.asp

Here are some highlights:

Now [baby boomers] are pioneering a new trend in matrimonial law - the "gray divorce," the phenomenon of couples divorcing after the age of 50.  

Several cultural changes have contributed to the baby boomers generating high rates of late-life divorce. In the past 20 years, gender roles have shifted significantly, and women have become increasingly less financially dependent on men. According to a recent survey by the American Association for Retired Persons (AARP), women over 50 now initiate two-thirds of divorce proceedings.  

Furthermore, boomers entering their retirement years are healthier than any previous generation and are projected to have longer life expectancies. As such, experts have observed a growing desire for fulfillment in the later years, as well as an inclination to leave a dispassionate marriage. Additionally, as the children of boomers enter adulthood, parents are less concerned about the impact of divorce on their offspring and are more likely to exit the marriage without worries about custody, child support and the effects of divorce on young children.

People who divorce later in life have had more time to accumulate assets and debts, which can be significant in a remarriage and subsequent divorce. Access to pensions, retirement account balances and Social Security benefits must be considered.  
Marriages and divorces later in life come with their fair share of financial ramifications. Later-in-life divorces can be problematic because individuals' future earning potentials are typically limited. When combined with the possibility of costly health problems, individuals may be unable to maintain the status quo of the lifestyle they enjoyed as married couples, and older couples may have a harder time adjusting their personal habits and money management styles.

New York is an equitable distribution state; accordingly, the marital assets and liabilities ("marital property") are divided in an equitable fashion, meaning that the marital property will be divided in such a way that fairly represents the parties' respective contributions to the marriage. In the context of negotiating a settlement agreement, it is important to consider all the assets that are subject to distribution. Parties may decide to trade off passive assets or negotiate percentages of various active assets, such as a business or professional practice, and courts typically look to indirect contributions - for example, from a homemaker spouse - in order to determine the proper percentages.  As for credit cards post-divorce, each party should remember to remove the former spouse from any credit card account held in his or her name to prevent the former spouse from incurring additional debt.

The amount of maintenance, if any, is generally determined by balancing the payor spouse's ability to pay with the payee spouse's reasonable needs. Additionally, it is imperative to secure any financial obligation. While life insurance may be cost prohibitive depending upon age and health, it is possible to secure payments through mortgages, confessions of judgment and other security devices. 

In today's troubled real estate market, the marital residence may not have retained its prior value and may remain unsold for a long period of time. Dividing the remaining equity (net proceeds) may not provide the husband or wife with enough financial wherewithal to obtain adequate separate housing.

Pensions and retirement plans are considered marital assets; typically, the amount that was earned during the marriage will be subject to equitable distribution pursuant to New York's Domestic Relations Law (DRL).   If the retirement plan is an ERISA qualified plan, such as a 401(k), 403(b) or other employer-sponsored plan, the law requires the non-participating spouse to be the primary beneficiary, unless otherwise waived in writing. It is important to obtain an accurate determination of the value of pension plans, IRAs and stock holdings, together with their concomitant tax ramifications. Taxes on retirement funds must be considered when determining the true value of those accounts.

Except as otherwise provided in DRL § 236, a husband and wife cannot contract to alter or dissolve the marriage or to relieve either of his or her liability to support the other in such a manner that he or she will become incapable of self-support and, therefore, likely to become a public charge.

So what's the lesson here?  As the article brings up several times, when couples are getting married later in life, an prenuptial agreement is more important than ever.  Couples should not feel that there is some stigma associated with signing a prenuptial agreement, especially when doing so can remove so many complications down the road.

Additionally, getting a divorce later in life, even when uncontested, still have many more assets and liabilities to work out than a divorce among a younger couple.  It is very important for both spouses to take a close look at their financial picture so that issues of distribution can be dealt with in the easiest way possible.