Dellutri Law Group - September 2019

1436 Royal Palm Square Blvd. Fort Myers, FL 33919 4851 Tamiami Trail North, Ste. 229 Naples, FL 34103 3841 Tamiami Trail Port Charlotte, FL 33952 4830 West Kennedy Blvd., Ste. 600 Tampa, FL 33609 37 North Orange Avenue, Ste. 500 Orlando, FL 32801


September 2019





Attorneys for Personal Injury, Bankruptcy, Foreclosure Defense, and More!

What I Learned from the Great Recession ‘It Was the Best of Times, It Was the Worst of Times’

This month marks the 11th anniversary of the Great Recession, which began in earnest in 2008. As a consumer-based law firm, we at Dellutri Law Group were able to see something coming based upon our clients’ stories, but we had no idea what was about to happen. For me, the story starts in November of 2007 at Thanksgiving dinner. My whole family was gathered at my house to dig into the turkey, and one of my family members who works in finance was talking about how wonderfully the stock market was doing and how the nation was prospering as a whole. Listening to him, I turned to my wife, Marjorie, and said, “Something is wrong.” Despite the strong economy, our phones at the office were ringing off the hook with clients scheduling bankruptcy consultations. That was the moment I realized there are two economies: One is the economy of Wall Street, and the other is the economy of regular people — let’s call that Main Street. The two are parallel roads running side by side without any apparent turnarounds or connections. While one is doing great, the other could be dealing with a 10-car pileup and no one on the first highway would be any the wiser. At the firm, we were shaking our heads in 2007 because, while Wall Street was at an all-time high, normal people on Main Street were having a hard time making their mortgage payments. Some of the first

people to come through our doors were mortgage brokers and real estate agents who were trying to file for bankruptcy before they missed months of mortgage payments. Those professionals knew that if you miss three months of payments, your credit score falls approximately 100 points. However, if you file before your credit score falls, it’s easier to rebuild financially. Bankruptcy will still hurt a little, but, if you start your recovery with a credit score of 700, you’ll be much better off than if you were starting at 500. Seeing people who knew those things rushing into our office told me that the economic downturn was going to be a lot bigger than what we were reading in the newspapers. Not long after that Thanksgiving, Marjorie and I were at home watching the news when the stock market began to crash. It fell 777 points in one day. We were stunned. We were thinking that the parallel roads of Wall Street and Main Street had finally converged, and it wasn’t going to end well for anyone. As for the Great Recession itself, I think it’s best summed up by a Charles Dickens quote: “It was the best of times, it was the worst of times.” Prior to the crash, people boasted about the equity in their homes to anyone who would listen. After the crash, people watched their credit scores tank and their houses lose equity. No one could refinance, and mortgage companies came knocking, telling people to pay up. Every day at work became a nightmare.

–Carmen Dellutri Above all, when worst comes to worst, don’t let your pride keep you from doing what’s best for your family. We survived one recession and, armed with what we’ve learned, we can survive another. Just when I thought I’d seen it all, my next appointment would change my mind. All I could do was offer people hope and wait for the economy to pull through. Now we’re seeing signs of something starting to happen again. Market vulnerability, trade wars, real estate slowing down, and it makes me wonder what’s next. I’m happy to say, though, that we have a toolkit to handle what’s coming this time. We can take the lessons we learned in the Great Recession and put them to work. Here’s my advice: Make sure you have money in your savings account, set aside an emergency fund, and don’t cut into your retirement plans — they’re protected under Florida law. Also, call your bankruptcy attorney. They can tell you exactly how to prepare for the future and give you guidance on what to protect and what not to. Never discount the power of bankruptcy if there’s another collapse. The people who filed early in 2008 came out smelling like roses, and the people who tried to hold on for the ride were hurt in the long run.

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