Archive for: ‘October 2013’

Foreclosure doesn’t have to mean the End of Homeownership

October 24, 2013 Posted by kingcade

When the housing bubble burst in 2007, Americans were hit hard. According to RealtyTrac, 4.8 million borrowers lost their homes to foreclosure and 2.2 million gave up their homes in short sales. The recovery has been slow, but finally the housing market is re-emerging and showing signs of strength. Many former homeowners have learned difficult lessons and gained a new perspective on saving and making wise investments.

Following these tips will help set prospective buyers who have previously faced a foreclosure or short sale on the right path to homeownership:

• Work with a reputable lender. Make sure that person has the experience and knowledge to help you make an informed, affordable lending decision. They can also explain the time limits that affect buyers who have previously faced a foreclosure or short sale. There is generally a set amount of time that needs to pass before you are eligible to be considered again for a mortgage loan.

• Make an honest assessment of your credit situation. Having a foreclosure or short sale on your financial record will affect what options you may have for loan approval. Be an informed borrower. Access your credit report from all three credit agencies by visiting It’s free!

• Save up for a down payment. Homebuyers re-entering the housing market after a foreclosure or short sale typically need to have a 20% down payment before purchasing a home. Keep in mind the additional expenses you may have to cover, such as closing costs. Properly handling financial responsibilities of homeownership beyond the monthly mortgage payment like taxes, homeowner’s insurance, utilities and other household expenses will be important in earning your loan approval.

• Get preapproved. It’s a good idea to work with a lender who offers a pre-approval program. The preapproval process helps borrowers determine their budget, first before getting into their home search.

Click here to read more on the steps to take to achieve homeownership after facing a foreclosure or short sale.

Bankruptcy Fraud and its Consequences: Don’t Let this Happen to You

October 23, 2013 Posted by kingcade

A 55 year old woman from Barron, Wis., has been charged with bankruptcy fraud. The indictment alleged that in December 2008, she concealed $18,977 in U.S. currency. The indictment also charged her with making material false declaration in a bankruptcy proceeding, by stating that she had only $100 cash on hand and fraudulently omitting a $12,000 transfer of U.S. currency to relatives and a $3,650 payment to a creditor. She is also charged with falsely testifying under oath in a bankruptcy proceeding on February 3, 2009, about the concealed currency and the transfer of currency to relatives.

If convicted, Cynthia Barlow faces a maximum penalty of five years in federal prison on each count. The charges against her are the result of an investigation by the FBI. If you are considering filing bankruptcy, do not attempt to hide money or assets. This can include transferring money to a family member or opening a hidden bank account to conceal funds. Do not attempt to hide or destroy property from a creditor. These actions can greatly affect the outcome of your case and land you in jail.

Click here to read more on this story.

The Dangers of Medical Credit Cards

October 22, 2013 Posted by kingcade

We all know that medical bills can be costly, especially when insurance only covers a small portion of the procedure. But recently, some doctors have been offering a solution to this problem- a special line of credit to help cover your bill. What seems like a perfect solution is becoming a credit nightmare for many. This “buy now pay later” option comes at a cost- high interest rates and severe penalties if payments are late or missed.

A growing number of health care professionals are urging patients to pay for treatment not covered by their insurance plans with credit cards and lines of credit that can be arranged quickly in the provider’s office. The cards and loans, which were first marketed about a decade ago for cosmetic surgery and other elective procedures, not typically covered by insurance, are now victimizing older Americans.

Patrcia Gannon, 78, learned the hard way when she signed up for Dr. Knelinnger’s medical credit card to cover her partial denture. The cost for the procedure was more than $5,700. She pays roughly $214 a month, which eats up about a third of her Social Security check. If she is late, she faces a penalty of $50. The interest rate for the card is 23 percent and she receives a 33 percent penalty rate if a payment is missed or late.

Doctors, dentists and other medical professionals have a financial incentive to recommend the financing because it encourages patients to opt for procedures and products that they might otherwise forgo because they are not covered by insurance. It also ensures that providers are paid upfront — a fact that financial services companies promote in marketing material to providers.

While medical credit cards resemble other credit cards, there is a critical difference: they are marketed by caregivers to patients, often at vulnerable times, such as when those patients are in pain or when their providers have recommended care they cannot afford or insurance will not pay for.

The problem has become so severe that attorneys in several states have filed lawsuits claiming that certain dental practices and other medical professionals have misled patients about the financial terms of the cards, employed high-pressure sales tactics and overcharged for treatments and billed unauthorized work.

The New York attorney general’s office found that health care providers had pressured patients into getting credit cards from one company, CareCredit, a unit of General Electric, which gave some providers discounts based on the volume of transactions. The investigation found that patients were misled about the terms of the credit cards, and in some instances, tricked into believing that they were agreeing to a payment plan with the medical provider when, in fact, they were being pushed into high-cost credit.

Click here to read more on this story and the dangers of medical credit cards.

TODAY marks the eight year anniversary date! Many consumers eligible to file Bankruptcy, again.

October 18, 2013 Posted by kingcade

Today, October 18, 2013, marks eight years since the country’s bankruptcy laws received a huge makeover, in an attempt to reduce the abuses of the system and shift more debtors into repayment plans, rather than have their slate wiped clean. The timeline is significant because when the Bankruptcy Abuse Prevention and Consumer Protection Act took effect on Oct. 17, 2005, it changed the countdown clock to eight years — from six years previously — before a debtor is eligible to file bankruptcy again. Now, anyone that filed under the old law is eligible to file, again.

The Bankruptcy Abuse Prevention and Consumer Protection Act changed far more than just the waiting period to re-file. It also established a “means test” to determine whether a debtor had the ability to repay. It also required that filers take pre-bankruptcy credit counseling and post-bankruptcy money-management courses. It also required lengthier documentation and increased fact verification by bankruptcy attorneys.

The goal of the reform law was “to prevent abuse and make the bankruptcy act fair.” Some experts contend that the reforms were partly intended to decrease bankruptcy filings, and as predicted, filings have dropped. In 2004, the year before the reforms were enacted, annual business and consumer filings totaled nearly 1.6 million. Other than 2005, when there was a rush to beat the Oct. 17 deadline, filings have not topped that 2004 figure and in 2012 totaled 1.2 million cases. Others attribute the decline in filings to the pullback by the credit markets to extend credit to risky clients, giving fewer people credit to default on.

Many people who filed before the law changed in October 2005, may have suffered a job loss, foreclosure or another economic hardship that has put them in the position to file, again. Back in 2005, the economy was much different than it is today. Due to their previous filing, they have been unable to file- until now!

Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at

Related Resources:

National Foreclosure Settlement Rules Revised Following Complaints

October 17, 2013 Posted by kingcade

The $25 billion national mortgage foreclosure settlement is getting tweaked following numerous complaints that mortgage servicers are falling short on the promises made to struggling borrowers. When the settlement was originally announced in February 2012, its goal was to compensate borrowers for the wrongs they experienced in the foreclosure process. It also put into place new servicing requirements that applied to the nation’s five largest servicers: Bank of America, Wells Fargo, JPMorgan Chase, Citigroup and Ally/GMAC.

However, recent complaints from homeowners, housing counselors and state attorneys contend that banks are not complying with the set standards agreed to as part of their pact with the Justice Department, attorney generals and the banks.

The new procedures put into place include:

• All five banks will give homeowners 60 days, instead of 30, to submit additional documents that might help them secure a loan modification before their home moves into foreclosure.

• Banks have promised to do a better job of overseeing employees who work with borrowers.

• Bank of America and Wells Fargo have agreed to be more specific about what missing information they need from homeowners.

• Bank of America and Wells Fargo have agreed to escalate loan modification applications when a customer is being asked repeatedly for more documents.

• Bank of America and Wells Fargo will now use an online portal to submit documents and create a direct contact for the housing counseling agencies working with struggling homeowners.

Click here to read more on the new changes in the national foreclosure settlement rules.