I got my senior’s week last week. Two different seniors, both over 80 came to see me for different reasons. The first was 83. He was in good health, just a little stooped. Still works full time and receives social security. Wife receives a small social security. He and his wife live with their son, so they have no mortgage or rent expense, which is good. He has a new car and pays a car loan of $400. He wants to keep the car. He has an old car that he used as collateral for a high interest loan. He does not want to keep the old car because the high interest loan requires $500 a month at 50% annual interest.  Yes, that’s pretty high interest for a secured debt. His problem is $35,000 of credit card debt that he has kept current for the last 15 years, paying $1,000 a month. He though it wasn’t such a great idea keeping them current in the last 15 years because he already forked over $180,000 in the last 15 years to keep them current, and surprise! He still owes the same $35,000 now. He thought he certainly would have been happier now if he had that $180,000 in his pocket. He could take his wife, his sweetheart of 60 years cruising all over the world and pay cash for those cruises. 

His wife wanted to take a cruise to the Greek isles and the Mediterranean coast, maybe spend a couple of days in Barcelona, enjoying the artwork of Dali and the whimsical architecture of Gaudi. He wanted to see the office of the Philippine tobacco company, which was in Barcelona when the Spaniards were still lording it over the islands. I asked him what’s your connection with the Philippine tobacco company anyway? He said his grandfather worked for that company his whole life and all he got from it was a gold plated watch and a gold plated cigar. Not even a good pension that he could live with. Why was your grandfather a Spaniard, I asked? He was an illustrado, he said, with a moustache that made him look like Pancho Villa. I asked him if he could still speak Spanish and he said “Claro que si, senor abogado.”   In fact, he told me that he still had many relatives in Barcelona, that’s why he wanted to bring his sweetheart to visit, and he wanted to meet all his Spanish relatives. Well, I told him that if you had gotten rid of your $35K of credit card debt 15 years ago with a Chapter 7 petition, then today, you could actually buy a condo in the south coast of Spain, and retire there with your sweetheart for a quarter of the cost of living in LA. Instead of being able to retire there with a fully paid condo overlooking the tranquil Mediterranean, you now have to get rid of your $35K of credit card debt, and live in a tiny room with your son. Think about the opportunity you missed to live in the South coast of Spain now, just because you wanted to keep your $35K of credit cards current for 15 years. And even if you prefer to live here in LA, the $180K of cash in your pocket, well managed, can give you an extra $700 of income a month which you can use to indulge what you and your wife want to do now. Otherwise, you wake ip everyday and just stare at each other, or watch TV the whole day. Not really an exciting way of living your golden years, is it?

He chooses to file a Chapter 7 to get rid of $35K credit cards even though it’s way late. Better late than never.

The second senior is 80. His wife passed away recently. They have no children but have a lot of relatives who owe him money. He and his wife were generous in lending a helping hand to their relatives when they were younger. $50K to a cousin who wanted to buy a UPS store. $40K to a brother who wanted to buy a restaurant. You know what I mean. The money lent has stacked up over the years and have not been repaid. He feels unsecure now because he has maintenance expenses now, which are escalating. Just the caregiver costs $2K a month. Well, the problem of course is that it’s easy to lend out money, but it’s very difficult to collect. First off, would be to file lawsuits to collect. So, at least you end up with money judgments that accrue legal interest at 10% yearly. In addition, placing judgment liens on real property can enforce these money judgments, wages can be garnished, and bank accounts can be levied. This is a lot better than waiting for his beloved relatives to start paying him back, which knows when. The truth is, which is better left unsaid, beloved relatives are probably waiting for client to kick the bucket so they can forget about paying him back. After all, he won’t need cash in heaven, would he? Nope. 

The third client is a young senior at 58. She is a single mom with a good paying job as a registered nurse. She has two kids in college who need support. Her problem is $50K of credit card debt. The choice is making minimum payments of $1,500 a month to visa and MasterCard, or giving the $1,500 to her college kids to help them pay their rents in out of state colleges. It’s a no brainer. Client decides to discharge her $50K of credit card debt with a Chapter 7 petition.

“THIS POOR MAN CRIED OUT, AND THE LORD HEARD HIM, AND SAVED HIM OUT OF ALL HIS TROUBLES. THE ANGEL OF THE LORD ENCAMPS ALL AROUND THOSE WHO FEAR HIM, AND DELIVERS THEM.” PSALM 34:6-7

Lawrence B. Yang is a graduate of Georgetown University with a Master’s Degree in Law and specializes in Bankruptcy, Business, Real Estate and Civil Litigation.  He speaks English, Mandarin and Fujian and has successfully represented thousands of clients in California, including companies overseas.  Please call Angie, Barbara or Jess at (626) 284-1142 for an appointment at 1000 S. Fremont Ave., MAILSTOP 58 BUILDING A-1 SUITE 1125, Alhambra, CA OR at 20274 Carrey Road, Walnut, CA 91789.