Hello, everyone. Thank you so much for joining us on “This needs to be said” today. Our friend, Ron Drescher attorney, Ron Drescher is here and he’s going to talk with us about bankruptcy in the age of COVID-19 Corona virus. That thing that has caused a nation- wide stay at home order. Meaning if you are not considered an essential worker, you’re probably supposed to be at home and helping to keep down the possibility ofspread. That’s one thing your health is definitely important, but we talk about the rest of your world included with your health When, we talk about bankruptcy. Ron, welcome back long time. No talk to how are you?
I’m well, Katherine, you know, or I’m like you just said, I’m hunkered down at home and, trying to, you know, work and taking the opportunity to work on some special projects that I have been thinking about doing for a while. And, so I’m doing okay. Thanks.
How are you doing?
Actually, because I work from home, there was no big change from, for me. So I was already using, you know, other sources to bring things to me. I had to change like the, preferred contact, free delivery or something like that. So they just set the bag down and I pick it up, but I already work from home. So it wasn’t a big adjustment for me. However, for my family, it was a big adjustment for them because they’re away from the house. And then when they’re here, that’s the only time I have to adjust as like what do I do with these people in my face so it is different and then around me, my neighbors are getting up as early and you hear children more often during the day because they’re not at school. So the outside noise is, is what changed for me.
Interesting, I could see that, but right, Leah,
We’re going to talk about bankruptcy and COVID-19 and even how this even matters to each other today, right
Yeah, absolutely! Absolutely and so I want to tell you some of my thoughts and some of the things that I’m seeing and, and some of this will qualify, apply both to businesses and to individuals. First of all, you should not be in a rush to file bankruptcy right now. especially if you’ve been furloughed or fired, your business has gone under, you know, if you’ve still got borrowing room in your lines of credit and your credit cards, you may need those to, you know, buy food, and, you know, pay the utilities and do other truly essential things. So, I am not in favor of rushing out and filing bankruptcy right now. What I think would make better sense for most people who are, who are going to need to file bankruptcy is that you wait until things really start to reopen and it looks like your income is going to resume.
That’s the time to really think about filing bankruptcy, because you’ve got your greatest hardships behind you don’t know what kind of hole you found yourself dug into by this disaster, but it’s, but it’s the advantage of bankruptcy to get you to jump out of that hole and resume a normal life. So I think while you’re still, at home sheltering with no income coming in, except for perhaps unemployment, I say, don’t file bankruptcy yet. Wait until things start appearing a little brighter and then many people are going to be tempted to see if they can dig themselves out. They might say, all right, you know what I’ve got that money in my IRA or my 401k let’s take out a loan, let’s pay those bills. And I admire the heroic, sentiment behind that. but I would urge anybody who is considering invading their retirement account to seek their bankruptcy options first cause creditors can never get their hands on your retirement account.
And it really was never set up to be a rainy day fund set up to fund your eventual retirement. So I would very, very much urge people to, to put that desire on pause before you, you invade those accounts. So that’s, that’s one thing about COVID and bankruptcy planning. And that also goes for businesses as well. I had a, a chiropractor call me at the very, very beginning of it. I mean, you saw his consequence, you know, subsequent appointments really, declining down to zero. And my feeling there is, again, you’re, if you have a business, you need to be in position when once this, this crisis opens up to be able to resume your business and perhaps re hire employees and purchase goods and services that are essential to your business. So I would say don’t deplete all of your personal resources now, before you can go back in set those aside, if you have to bite the bullet, make the hard decisions, lay the people off.
I’m sorry to give that advice, but I think it is the right advice so that when things open up again, you have resources to jump back into the stream of business and, and, and keep your small business alive. So those are my two main sources of advice for people who are kind of thinking, well, I’m in trouble. Should I, should I bite the bullet and pull the trigger and file bankruptcy Now I say, no, I would. I advise, I advise waiting now on the other side of the coin, oddly enough, this whole mess to some people may provide an opportunity if you time it correctly, because you might be a high income person who would not qualify for the broad relief that’s available in chapter seven. And because of your income, you might be forced into a chapter 13 where you have to make a payment over over five years every month.
If you have severe, severe income interruption due to this, this COVID mess. I, again, I say, wait until the end of it. And it looks like your income is going to be picking up again because we look at the last six full months. And my guess is you will have had pretty significant income interruption from March and, and tremendous income interruption for April. And I don’t know what Mae is going to bring, but you’ll probably have some income disruption for me as well. So if we put your bankruptcy off until June, when, when it seems most likely that things will really start picking up, in a flurry, then we’re going to go back. And we’re going to look at the full income from may and the full income from April and the full income from March. And then of course, February, January, and December, and those six months might be enough to allow you to get into chapter seven, but otherwise you’d be in a chapter 13. So that might be amongst the dimmest of silver linings imaginable, but it is a potential opportunity for people who would otherwise have needed to consider their bankruptcy options going into the quarantine. Now they might really be able to get the best available bankruptcy relief once the quarantine begins to open up.
Gotcha, you know we talked about this and, another interview probably at least twice, you and I, and I say, okay, Ron, when is the right time for a person to come and over the time that we’ve been talking, nothing really happened like COVID-19 right, So we didn’t have like, Hey, your listener you’re being impacted right now, because before it was very personal, very private contact, Ron, on your own about your own topic, it won’t be a one size fits all. And it’s still not a one size fits all, except for the part where everybody some way is affected by what’s going on right now, go to the grocery store. Physically, you have to, you know, be mindful where you’re standing. Some people are wearing masks. Some people are not, you know what I mean so we’ve talked about when to file for bankruptcy, went to know and see the signs
And for me, because we’re in this moment, it’s so vivid for me. And this could be anybody USA, anybody in the world, but anybody USA, as we’re speaking, it’s affecting you. And I’m listening to what you said about, you know, this could be an opportunity, even though it’s a crisis and the timeline and how you just mapped it out, I was like, okay, well, you see where you are right now. If you’re laid off or, you know, you, you see a severe income interruption. I wrote that down. I liked the way you put that. So you see this and you said, okay, this is the timeline. We’re looking over six months. And if you go at the beginning of the epidemic, then you’ll maybe get one option. But if you wait and you can stand the pain a little bit and see have a better picture of what your financial picture is going to look like, because the first three months, yeah, you had money, but you also had a job.
Now, you don’t have a job, but there hasn’t been time between you not having that job. So the way you just explained it wrong in my mind is like, wow, perfect timing, perfect example. This applies to everyone. Everyone has to listen. And I think this will stick to any personal situation they’ll have. And they’ll say, well, you know, Ron talked to us about COVID-19 and how to, you know, see if we can put ourselves in a better position to get the best option. If we need to file bankruptcy, what else can I do How else can I apply this And I’m really lingering on that point audience, because I want you to think about when you have one example, it fits somewhere else. And before I didn’t have one that touched everybody, maybe some people lost the job, maybe. Yeah. Maybe some people had medical experience expensive but everybody is having to stay at home now. So that’s what makes the difference here. So with this one exam, go ahead.
Yeah. You know, Katherine, I was, I told my wife because we were sheltered together. So, you know, Carvana, right.
Corona viruses, not the top story. It’s the only story. Wow. Yeah. So, I mean, right, you look at cable news and you read the paper, everything. It’s also an, a virus for good reason. I mean, we, none of us, none of us listening, none of us talking I’ve ever been through anything close to this. So this puts me back to a kind of my general philosophy about bankruptcy. I frequently tell people that bankruptcy is a four letter word and that word is gifts because he really is GIF T it really is the opportunity to climb out from, from things that, that are oppressing you to, to kind of get a blue sky again. And another thing that I tell people about bankruptcy is, you know, most people, when they take on a debt, almost everybody, when you take on a debt or you live your life, you have a plan, have a plan for how much each month you’re going to pay towards that debt.
And, and most people are very prudent. They really are. And most people that come to see me are prudence. you know, buts bankruptcy becomes necessary when your plan goes awry. And you know, so how are the different ways your plan goes awry You know, you’ve got a small business selling greeting cards of Walmart opens up across the street. You just sick. You get injured, you lose your job. You get divorced. All of these things, your child gets sick. I’ve seen him all of these ways that people, have an unexpected, wrinkle that comes up that interferes with their plan. And now we’ve got the biggest of all. This is the biggest wrinkle of all, where, where the entire world is shut. And, you know, the ripple effects of this are going to be astronomical. And I think of, you know, you think of the, you know, the sports sporting events theme, well, the players, the players go without on the vendors go without, and you don’t want to, if you got a guy who has a little like piece of grounds, you know, a half a block from the stadium, you know, supplements his income by charging 10 bucks for parking, you know, the ripple effects.
And then for the people who was all for the consumer, you know, so you don’t have the entertainment, they don’t have the employee. It is it’s everything. So if you spend a Sunday getting a break,
The dry cleaning store, do you ever dry So we have, we, you know, people aren’t going to work, so they’re not wearing their suits. They’re not worried their blouses. They’re not wearing their pleated skirts. They’re not wearing their, you know, starch collar shirts. That means that they, the laundry, the cleaners are suffering
Car detailers, Amit, any, any of the airport Go ahead.
Here’s here’s another one. Look, let’s say even a big company, a company like Costco, big company. All right so let’s say you’ve got people that are relying upon performance bonuses to take a vacation. Yeah, alright well, the performance bonus is not going to be there because the company doesn’t have the money. You don’t have the vacation. That means all right, nobody’s going to be weeping for Disney world. How about the small motels around this new world that has people on a budget, but how about, you know, the, the, the, the small restaurants around Disney world How about the guy who parks a car on a valet by the airport You know, the ripple effect is just going to be unimaginable.
No, I think because Ron, I think because we have never seen it before we, we have heard about things. I can’t even say this, but we’ve heard about things. We’ve read history. Books, grandparents have told us things. We’ve never lived it. And it’s really hard for us to wrap our minds around it. I asked different people. What’s the reason you think that particular communities are not taking it seriously. Someone emailed me and said, well, I heard that the Mecklenburg County, health director says the African American community isn’t taking it seriously. Well, I went to the African American community and said, Hey, I hear we’re not taking this seriously. What’s the reason and, the people that I talked to said, well, one, it’s not just the African American community, too, people don’t know how to properly protect themselves. Three people are not understanding, how to adjust and for a lot of your low skilled workers are in your minority groups. So they’re going to be out anyway. So I was like, wow. So it’s not just blatant disrespect. So then we have our opinions of why this person or this group isn’t doing, but it’s a ripple effect because if those low income, low wage workers don’t go to work, that doesn’t, we won’t have a lot of the things that we need to just basic groceries. I want to get gas at the, at the gas station.
I could go further than that. There’s a couple of really interesting things. First of all, the more high income you have, the more flexibility you’re likely to have the ability to work from home and working remotely. If you are in, if you are in a lower income service business, you know, I mean, if you’re a waiter or waitress or something like that, she can’t. So, so that’s a, there’s a form. It’s more of a class problem in my opinion, than a race or ethnic problems another thing that lower income people have less living square feet per person, right Yeah. I mean, if you are, if you’re a higher income person, you’ve got a larger dwelling place. Where as if you’re a lower income person you’re living on top of other people in the apartment house or the projects or something, right? Of course, of course, there’s going to be a greater spread amongst that community. I made it hogwash to say that the African American community is not taking it seriously. Every time I go out, I don’t see any distinction between, you know, African American people, Asian people, Hispanic people, white people, they’re all there. They’re all they’ve all rolled their sleeves up, put their masks on and are doing their best. That’s what I’m seeing.
Yeah. I am in agreeance with you. I was like, wow, okay. I’m in the African American community. Maybe I missed something. You know? the people I know, you know, we seem to, right, right, right. But I give, I give ’em a valid airtime, you know, to people to say, okay, well, you know, because that’s what happens with stereotypes. We figured bankruptcy’s bad. Right, when we’ve talked repeatedly, repeatedly, repeatedly that this is part of your, your rights. This is in your constitution to have this right, to be able to reset yourself. You see So it’s okay. You know? It’s okay for people to, you know, think that something isn’t right. Or cause that gives us the room to talk about the elephant in the room. The elephant here is I don’t care who you are, what class you’re in, you’re being affected. Because even if it’s not you directly on your job, like you said, a higher wage earner has more flexibility.
A lower wage earner has lower flexibility, lower options, less options, right So it affects all of us. But that person on the bottom probably bags your groceries probably parked your car for you. You know what I’m saying So we all work together and we’re all, important in this. However, what we don’t understand is what is available to us, no matter what class we’re in, whether you’re a low wage earner or high wage earner you’re able to use this gift that Ron just pointed out. It is a gift of resetting yourself financially but it’s not just go out and quick fix it. It’s really your plan went off the trail and you just trying to get back on track. This is not a get out of paying your bills kind of thing. You really have to understand what’s available to you. You know what I mean
We could talk about so many different things, so many ripple effects, so many, we, if we would have done this, we would have had this kind of behavior. You know, if, if wherever you’re living, you feel like your official, your government isn’t doing right by you. It didn’t start when we had COVID. It started with us not understanding what we have available to us. And in resetting your finances, bankruptcy is one of those things, Ron, I’m going to shut up. I’m sure the audience is enjoying us talking, but I want to make sure that they understand, you know, your purpose in being here today, talking about bankruptcy in the face of the age of COVID 19,
Right and so, you know, my office, I’ve always tried to make life convenient for my clients. And so I’ve had a remote bankruptcy product for years where my clients really never have to leave their house to do the bankruptcy. We do the consults, over the phone, everything is done by email or you can upload your documents. you know, you can sign them all remotely. You don’t have to come to my office to do that. And it used to be that the only time you had to leave your house to do the bankruptcy when you use my firm is to go to the meeting with the trustee, which involves more as at the federal courthouse, but now all the courthouses and all the bankruptcy courts, at least in my jurisdictions are doing telephonic trustee meetings. And you know, so, so now literally, I mean, look, if you’re being garnished and there are still garnishments going on, there are still bank accounts seizures going on.
There are still reasons why you would have to file bankruptcy that that are pressing. And we can take care of that. My hope is that this experience will cause a sea change in the bankruptcy universe. So that from now on all of my clients will be able to appear telephonically at their trustee meetings. Because you know, to me, that’s a terrible irony that the meetings are five or six minutes long, but they run late and you have to take a half day off work. So we’re talking about the most at risk population. People need to file bankruptcy, have to take a half day off work to go to a trustee meeting that can just as easily be conducted over the telephone. So let’s all keep our fingers crossed that, that this experience we’re having will, will cause very traditional, and an old fashioned ways of looking at the world to change for the better of everybody. And, and I’m hoping that we get, we get that opportunity as well.
I’m, I’m listening to you. I’m seeing it. And I I’ve heard someone say multiple times, different people say business is not going to be able to go back to the way it used to be. And I am seeing opportunities. I’m seeing that we should have had social distance in any way. Have you ever been in a store thinking, gee, you’re too close to me You know what I mean So I’m hoping that even for the people that are mostly affected by things that if they took time off from work would really impact their household. I’m hoping that a service like being able to do the trustee board meeting after this, pandemic, I hope that it continues. I hope that we find ways to you already are going through something. You know what I mean Like it doesn’t have to be traumatic, like terrible, but you have to go and do this process.
If we have a better way to do this process and still get the same, you know, the end result is we need to have the meeting with the trustees then great because now you have really enriched this person’s life with this gift. Yes. You must go through these things. Yes. You know, whatever the process is for bankruptcy. And when we get here, we’re not going to continue to make it hard for you, even though it’s been the process forever. I hope it does get to change, Ron. I really do. I hope a lot of things get to change for the better and that we’re able to. I just really want people to see this as a gift I had to use bankruptcy years and years and years ago. And I felt so bad, so ashamed, so guilty so all I did something wrong and Hmm, I have to tell you wrong. And I’m trying not to cry because this has been lots of years ago. It was, it was bad.
I’m going to tell you something. I had a house foreclosed 30 years ago and it was the worst feeling in the world. But things happened in my life couldn’t be helped. I was already a bankruptcy lawyer by then. But, yeah, people just go through stuff and, and that’s, and that’s the plans go awry. They just,
And it’s not that you’re a bad person. Yeah. It doesn’t mean you’re a bad person. Doesn’t mean you like skipping out on your bills. It doesn’t mean those things. So when I’ve been doing these interviews, you guys, I know what it’s like to have to make the phone call. And
I think that it, I think that if people were more willing to ask for help, it would be a better world.
It would, it would, there are people that are willing to help you, but we don’t know what to do. We humans don’t know what to do for the other humans. And if I offer you something, it may not be what you need it, but it’s the thought that counts. No, it really didn’t help me this time. So we would ask for help just if I say, no, maybe Ron says yes. If Ron says, no, maybe the next person says, yes, you know, we want a shortcut and we want it easy. And we want no problems. And if we just set it and forget it, like it’s great, life takes effort. You got to participate. So yeah, I think if we did and if it wasn’t for, and even with me, I don’t mind asking for help, but it still hurt my feelings. But if I didn’t do it, I would have, I would have been stuck with an option that couldn’t work for me.
Good thing for me, I was a space where she was able to, my attorney was able to give me options and say, you do this you make the monthly payment. You do this it’s a clean slate. And either way, it didn’t feel good cause i’m like, oh, these people, this is bad. Right, but also needs to reset. And I had three children and I’m a single mom kind of thing, you know so they, they didn’t need for me to, try to be the hero and do it all myself. I needed help. So I used my gift and, and the thing about it, I didn’t know at the time and not that I intend to have to use it again, but I didn’t realize it. Wasn’t a one and done, you know, but you do have to, you know, do your best, but you got a clean slate.
Now you can begin again and try to do better. And I have to say, you know, I didn’t have your program or the seven 50 wrong, but I have to give you back to seven 50, but I am in better position than I was before I actually, if I would have left it alone. So I know for myself that it was good. I didn’t feel warm and fuzzy like I do when I talk with you and I don’t feel better educated, but the person, you know, let me cry. And they helped me get through the process. It wasn’t a warm sympathetic thing. It just kind of was like, well, this is where you are. And this is what we can do. And it felt cold and it may not be what they meant. But when I had the opportunity to interview an attorney who cares and does bankruptcy, I was like, Hmm, suspicious, but let’s go for it.
You know and over time I’m like, wow, these are the attorneys I would have loved to. You know and I want more people to see that it’s a relief. It’s not a magic wand. It’s a relief. This is your right. You get to use this. This is for you to reset. And everyday people go through it, our bankruptcy attorney just share it. He’s gone through it. You’re radio host it. She just went through it. Anybody can get it. Any body can be affected by it. You know So Ron, thank you for letting me get myself together.
I’m glad you were able to get help back when you need it.
Yes. Oh my gosh. Yes. Yes. It was terrifying but it didn’t have to be, it didn’t have to be. And the more we educate people, the more they’ll realize, Hey, this is what I need to do that, you know, and even other things that aren’t exactly related to bankruptcy when you, well, I guess it is cause you said bankruptcy, your creditors can not take your retirement. People listen to these things. Listen to these things because you may feel guilty. I’m have this money and savings, but it’s for a reason, if it’s for retirement, make sure you don’t mess up tomorrow trying to fix today. All right, Ron, before we get out of here, I know we are over overtime and we’ll have to get together again soon. But before we go, let people know how to get in touch with you outside of this needs to be said,
You know what Drescher law.com, D R E S C H E R L A W.com. My website, I have, I have250 videos on my YouTube channel. That’ll answer a lot of your questions. And that’sa Maryland bankruptcy lawyer to Google, Maryland, bankruptcy, lawyer, my name RonaldDrescher, you’ll find my YouTube channel and, and there’s a lot of information there.
Thank you Ron so much. Thank you. And until next time you have a super day
My pleasure, you too, Katherine, stay safe.