There are some common misconceptions about bankruptcy that we hear from clients and in the news quite frequently. Many people think that for an individual to consider filing for bankruptcy he or she must have a substantial amount of debt and that he or she must have been financially irresponsible to find themselves in such a situation. We know that neither of this things are necessarily true. Of course, when you consider filing for bankruptcy you should evaluate how much you actually owe because there are some situations where it may not be financially advantageous to file for bankruptcy. But, we know that the amount is different for everyone and depends on family income, family size, and assets. We also know that many of our clients have not been "financially irresponsible", rather there was some trigger to their financial situation like sickness, unemployment, etc.

We also know that it isn’t just credit cards and purchases that contribute to financial crisis. We meet a number of people with tax debt and people that are behind on upside down mortgages. Now, we’ve talked about taxes before, and you know that those are not generally dischargeable. But, what you may not know is that people lose their homes everyday over tax debts. We have clients that are behind as little as a few hundred dollars in taxes. From there, the State can obtain a tax lien on your real or personal property. One there is a lien on the property the State can actually force a sale on the property if it remains unpaid.

Even scarier than losing a home over a few hundred dollars is the fact that to redeem those liens on the property you could be looking at up to a 20 percent interest rate. Further, studies show that homeowners most vulnerable to default and tax sales are elderly people or individuals with cognitive disorders that are unable to understand the proceedings. In fact, there are plenty of lenders, including JPMorgan Chase and Bank of America, that use the tax sales to make large profits off of homeowners. In some instances these lenders report profits of over 50 percent. Unfortunately, someone had to lose their home for that profit.

While we don’t necessarily practice tax law, we can help you keep your home. While taxes cannot generally be discharged they can be addressed through bankruptcy. Further, your home and property will be protected while everything is sorted out and we get you back on track to financial stability.

If you have questions about this, or any other bankruptcy matter, please call you St. Louis Area Bankruptcy Attorney today to set up a free consultation!