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COVID 19 Lockdown: Should I File Bankruptcy?

In response to COVID 19, Governor Gavin Newsom enacted Executive Order N-33-20 on March 19, 2020, which essentially locks down most businesses outside of the  16 federal critical infrastructure sectors. Since many residents in San Diego and across the country are not considered essential, many are now unemployed.   The Covid 19 lockdown is going to affect the entire economy in one way or another, with lasting effects trickling down into all facets of the economy.  Debt relief programs such as bankruptcy, forebearances, and moratoriums on evictions and foreclosures will soon become the new normal.  For many it might be the best time file for bankruptcy relief and discharge debt.

 

The federal government is currently working on a $2 trillion-dollar stimulus plan which may result in 1) sending of every American at least $1,200 dollars, 2) bailing out small businesses with $349 billion dollars, and 3) bailing out the airlines with $50 billion dollars.  And this may only be the start, as negotiations in congress continue, it could grow to multiple checks and bailouts surpassing $4 trillion dollars or more as of this writing.

 

For most people living in San Diego, where the median income for a for a family of 4 is $101,315 per year, $1,200 dollars is only a fraction of the monthly mortgage or rent payment, let alone other monthly costs.   But reality is, as incomes dry up, stimulus money is undoubtedly going to be spent on more essential needs such as food, medical bills, and gasoline.   Mortgage payments will default, rents will be missed.  Vehicle loans will default.  Programs last seen during the 2008 Financial Crisis will re-emerge, such as foreclosure moratoriums and federal loan modification programs.

 

For many people, filing for Bankruptcy Relief in San Diego might be an attractive and viable solution to deal with or eliminate debt, especially given many people may not otherwise have qualified for Bankruptcy Relief during the period of their most recent employment.  For instance, if your income on the means test exceeds the income for the locality you live and you file for Bankruptcy Relief, your case may be subject to dismissal.  But if you have no income, even if you had income in the last 6 months that would have otherwise prevented you from filing Bankruptcy successfully, the change of circumstances will rebut any presumption that the bankruptcy is an abuse.  In other words, many will now qualify for Bankruptcy Relief, from an income standpoint.

 

Indeed, this may be a golden opportunity for thousands of people strapped with overwhelming debt, resulting in a unprecedented transfer of wealth between consumers and banks not foreseen by even the savviest economist or YouTube blogger.   High income wage earners can now legally discharge millions of dollars of consumer debt.

 

Even San Diegans part of the 16 federal critical infrastructure sectors should also find relief with the Bankruptcy Laws.  Hours have been cut as a many businesses limit or adjust their hours of operation.   As many businesses evolve to the “Virtual” marketplace and make other critical adjustments to their business model, it will all have a direct economic impact on their employees’ wages as well as the local communities those employees supported.  No one seems to be immune from this.

 

As new modalities to treat the coronavirus emerge, there will be further need of modalities to treat the financial difficulties consumers are facing.  One such modality is working with a Licensed Bankruptcy Attorney, which is designated by the United States Government as a debt relief agency.   Doan Law is one of San Diego’s most prominent federal debt relief agencies and offers free consultations to those looking for debt relief.  Call or email today for a free consultation, from the comfort of your own home.   You can now file for Bankruptcy Relief, start to finish, without leaving your home, as all appearances are now mandated telephonic by the Bankruptcy Court and United States Trustee Office.

 

Written by Shawn Doan

Owner of  Escondido Bankruptcy, San Diego Bankruptcy Attorney Shawn A. Doan received his bachelor’s degree in Business Administration from the University of San Diego. Shawn A. Doan attended Thomas Jefferson School of Law, graduating with a Juris Doctorate degree and gaining acceptance to the California Bar in 1999. He has successfully represented thousands of clients in Bankruptcy proceedings. He is admitted to practice in the Supreme Court of California and the Southern, Central, and Eastern Federal District Courts of California. Shawn A. Doan has successfully litigated hundreds of claims against credit card companies that willfully violate the bankruptcy code and other state and federal laws designed to protect consumers.

shawn@doanlaw.com
312 S Juniper St Suite 101
Escondido, CA 92025
phone: 760.746.4476
fax: 760.746.4436

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PURSUANT TO THE NEW LAWS, WE MUST DISCLOSE THAT WE ARE A DESIGNATED DEBT RELIEF AGENCY UNDER 11 U.S.C. ß528. WE HAVE SUCCESSFULLY ASSISTED TENS OF THOUSANDS OF SOUTHERN CALIFORNIANS IN FILING BANKRUPTCY, DISCHARGING BILLIONS OF DOLLARS, AND WILL CONTINUE TO DO SO UNDER THE LAWS.

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