Archive for: ‘September 2015’

Where the 2016 Candidates Stand on the Student Loan Debt Crisis

September 29, 2015 Posted by kingcade

Student loan debt is playing a prominent role in the presidential election this year.  Almost every one of the 20 candidates running for president has been forced to address the issue of college affordability in some way.  Candidates are unveiling their plans to reform higher education and help the approximately 40 million Americans struggling with student loan debt that has ballooned to $1.2 trillion. The candidates’ plans range from debt-free college to matching students with private investors to finance their tuition.

Here is where a some of the front-runners stand on the issue:

Get students through school faster, expand access to alternative higher education programs and give colleges an incentive to drive down costs and improve quality. “I think the focus ought to be on how we reform higher education so that full time students can get a four-year degree in four years.” Jeb Bush, Republican (Former Governor of Florida)

Use government intervention to ease the student debt burden. “We need to transform how much higher education costs- and how those costs get paid.” Hillary Clinton, Democrat (Former U.S. Secretary of State)

Stop the government from profiting off student loans. “I think it’s terrible that one of the only profit centers we [the government] have is student loans.” Donald Trump, Republican (Businessman)

Expand income-based repayment, allow private investors to partner with students to cover the cost of tuition in exchange for a chunk of their incomes. “Colleges know the federal government will continue lending students as much as they need in federally guaranteed loans.” Marco Rubio, Republican (U.S. Senator from Florida)

Unofficial: Increase in competition in the education and student loan space. “The more choice we have- whether in K-12 or in higher education – the better choices and chances young people have.” Carly Fiorina, Republican (Former CEO of Hewlett-Packard)

Allow students to refinance their loans, but also roll back government involvement in education. “For too many, college is where students discover mountains of debt- but not a lifelong career.” Mike Huckabee, Republican (Former Governor of Arkansas)

Debt-free college is “wrong,” but he wants to reform the student loan system to focus more on low-income borrowers.  “If college graduates are going to reap the greater economic rewards…then it seems fair for them to support the cost of the education they’re receiving.” Chris Christie, Republican (Governor of New Jersey)

Debt-free college. “Right now there aren’t even the pathways for families going to college without a huge debt.  It’s only a question of how big the mountain will be.” Martin O’Malley, Democrat (Former Governor of Maryland)

Unofficial: Require families to rely more on personal responsibility, instead of student loans to get through school. “Should we be looking at ways to reduce student debt? Yes, but not if it’s going to drive up the (national) debt.” Ben Carson, Republican (Neurosurgeon)

President Obama is also partially responsible for student debt’s prevalence on the campaign trail.  His administration drew more attention to the issue than most with proposals for free community college and a publicized crackdown on for-profit colleges.

Click here to read more on this story.

For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. 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 www.miamibankruptcy.com.

South Florida Renters Stuck in aftermath of the Real Estate Crisis

September 28, 2015 Posted by kingcade

It’s not only homeowners whose houses are underwater; owners of rental properties are underwater as well.  South Florida’s foreclosure rate has dropped by 50 percent over the last year, but is still double the national average, according to CoreLogic.  It is estimated that one in every 87 homes in the region had a foreclosure in the first quarter.  In Miami-Dade, Broward and Palm Beach counties, about 16 percent of mortgaged homes are underwater, with loans greater than their current market value.

When it comes to foreclosures on rental properties, tenants worry about being kicked out on the street with no notice.  Renters often do not know if the property is in foreclosure or in jeopardy of being sold, due to high turnover among tenants and unscrupulous landlords.  Oftentimes, they do not receive the notice to which they are legally entitled to.

A recent change to Florida’s landlord-tenant law is designed to help.  It guarantees that renters will have at least 30 days after the property is sold to move out.   The law took effect on June 3, 2015 and was meant to replace a federal law, the Protecting Tenants at Foreclosure Act. That law, passed at the height of the foreclosure crisis in 2009 and gave renters the right to stay in their homes until their lease expired — or at the very least, 90 days.  The original law was meant to be only temporary and expired on December 31, 2014.  Without any comparable law in place, before June 3, 2015, tenants were simply out of luck.

The best advice for tenants is to have a back-up plan in place and speak with an attorney to help better understand your situation and your rights when it comes to the foreclosure of your rental property.

Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

 

Related Resources:

http://www.miamiherald.com/news/business/real-estate-news/article34388157.html

Recent Ruling to Impact Future Chapter 11 Bankruptcy Cases

September 26, 2015 Posted by kingcade

The U.S. Court of Appeals for the Third Circuit has issued an opinion that will have a significant impact on Chapter 11 bankruptcy cases.  Basically, the decision will reinforce the tendency to resolve Chapter 11 cases by what is referred to as 363 sales, as opposed to traditional reorganization plans.

The case involved a debtor described as a “leading operator of long-term acute care hospitals.”  The company was deep in debt, but attempts to sell resulted in offers that would not even clear the secured debt, not to mention the more than $100 million of unsecured debt.

So instead, the debtor decided to sell itself under Section 363 of the bankruptcy code.  But the only bidder to show up was a secured lender, who agreed to forgive most of the secured debt in exchange for all of the debtor’s assets.   The IRS noted that the debtor was going to owe capital gains taxes on the sale, but collecting the taxes would be tough, since the debtor did not have any assets.

The creditors’ committee also expressed some concern that its constituency was going to be left without anything in the deal and questioned whether it was an appropriate use of the federal bankruptcy code.  The secured lender had already agreed to pay the costs of the bankruptcy case, and agreed to make a token payment to the unsecured creditors.

Now with only the IRS objecting, the bankruptcy court approved the sale, and the appeals court upheld the bankruptcy court’s decision.   The IRS argued that it was just as entitled to payment as the bankruptcy professionals and was clearly entitled to payment before general unsecured creditors.

In the opinion of the Court of Appeals for the Third Circuit, Judge Thomas L. Ambro, who is a member of the American College of Bankruptcy, explained that plans involve the distribution of bankruptcy estate assets.  In this case, the payments to professionals and unsecured creditors were coming directly from the secured lender.  It is a subtle distinction- but an important one. This decision will greatly affect the structuring of bankruptcy plans in the future.  More importantly, it suggests flexibility in 363 sales that might not exist in traditional reorganization plans.  As a result, the case is apt to lead to even more quick sales in corporate bankruptcy cases.

Click here to read more on this story.

If you have any questions on this topic or are in a financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. 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 www.miamibankruptcy.com.

Foreclosure or Short Sale- Which Option is Right for You?

September 24, 2015 Posted by kingcade

When mortgage payments begin to pile up, some struggling homeowners opt to sell their home.  However, if selling your home does not materialize within a certain period of time – you are left with two options, either short sale or foreclosure.

Before filing foreclosure, it is important to have some knowledge of the process and speak with an attorney.  First, you will receive a Breach Letter that will lead to a ‘Foreclosure Workout’ between you and your lender.  The objective is to come to a resolution for both parties in order to cease delinquent payments.  This process will take 45 days, after which a foreclosure action will commence if there is no resolution. It usually takes 90 to 120 days before you receive a Notice of Default or NOD.

Afterwards, a temporary indulgence is granted, which usually takes 30 to 60 days where you are given a chance to bring the loan current. The borrower can also come up with special or long term forbearance. This involves payment suspension for 18 months and up to 24 months for long term. Other procedures may apply, for example, military indulgence, pre-foreclosure sale, deed-in-lieu of foreclosure, forbearance and modification.

A short sale can be a very enticing solution, but should come with fair warning.  Short sale involves your lender selling your home at a much lesser amount than you owe.  For example, if you are required to pay $190,000 on your loan, the price of your home can be sold for “selling short” of $40,000 at an equivalent of $150,000 only.

For homeowners who choose this option, it is important to remember the tax exemption that was originally granted by Congress in 2007 has expired.  The exemption of taxes for “imputed income” due to short sale transactions ended at the last quarter of 2014.  As a result, the ‘selling short’ or remaining balance of $40,000 will leave you liable for a hefty tax bill from the IRS at the end of the year.

Understanding the pros and cons of foreclosures and short sales is crucial before moving forward with either option.

Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Related Resources:

http://www.realtytoday.com/articles/18529/20150706/making-a-choice-between-foreclosure-and-short-sale-for-your-property.htm

Struggling Buyers Making a Comeback in Today’s Housing Market

September 22, 2015 Posted by kingcade

It’s hard to believe that seven years ago the Great Recession hit Florida.  Our state led the nation during the housing boom and was the first to crater when the housing bubble burst.   However, nearly eight years after the downturn began, buyers damaged by excessive medical bills, underwater mortgages and a dismal job market are finding their way back into the real estate market.

Lenders like Fannie Mae have changed its lending criteria. Real estate agents, banks and mortgage brokers are working with buyers, counseling them- oftentimes free of charge- on how to make repairs and get their credit back on track.   Free seminars are cropping up all over the state informing buyers about programs, timeframes for waiting, how to spot credit errors, how to purchase damaged homes in need of renovation and how to get down payment assistance.

Click here to read more on this story.

Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.