Posts Tagged: ‘debt relief’

How Can I Verify Whether or Not a Debt Collector is Legitimate?

September 12, 2017 Posted by kingcade

Debt collection scams are becoming more difficult for Americans to detect. However, the Consumer Financial Protection Bureau (CFPB) offers consumers a few ways to recognize a real debt collector from a scammer.

According to the CFPB, the first thing you should ask the caller is for their name, company name, street address, telephone number and professional licensing number. The next thing you should do is tell the caller is that you refuse to discuss any debt until you receive a “validation notice” in writing, which debt collectors are required to provide. An important thing to keep in mind is do not give out any personal or financial information to the caller until you have confirmed it is a legitimate debt collector.

Below are a few warning signs that could indicate a debt collection scam:

  • The caller threatens you with criminal charges. If the caller is a legitimate debt collector, they should not claim they will have you arrested.
  • The caller refuses to give you information about your debt. You have the right to ask a debt collector about the debt.
  • The caller is trying to collect a debt that you do not recognize. If you do not recognize the debt, this is a red flag, the caller might be involved in a scam.
  • The caller refuses to give you a mailing address or phone number for the company.
  • The caller asks you for sensitive personal financial information. Do not provide your financial or personal information unless you are certain the caller is legitimate.

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If you have any questions on this topic or are in 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.

Wells Fargo Review Finds 1.4 Million More Fraudulent Accounts

September 11, 2017 Posted by kingcade

Last September Wells Fargo agreed to pay $185 million to settle three government lawsuits over the bank’s creation of fake accounts. Thousands of employees, trying to meet aggressive sales goals, created accounts in customers’ names without their knowledge. Workers who did not meet goals risked losing their jobs, while those who did meet their sales goals received bonuses.

At the time, Wells Fargo said that 2.1 million suspect accounts had been opened from 2011 to 2015, but it also acknowledged that the problems may have started earlier. The bank said it would expand the review to include accounts open from 2009 to 2011.

Last month the bank reported finding 1.4 million more accounts, bringing the number to approximately 3.5 million fraudulent accounts – nearly 70 percent more than the bank’s initial estimate. The bank has since released that 528,000 customers have been enrolled in the bank’s online bill payment service without authorization. The bank stated it will issue $910,000 to customers who incurred fees or charges, as a result.

“We are working hard to ensure this never happens again and to build a better bank for the future,” Timothy J. Sloan, Wells Fargo’s chief executive, said in a statement announcing the review’s results.

Senator Elizabeth Warren, Democrat of Massachusetts, released a statement saying, “Unbelievable. Wells Fargo’s massive fraud is even worse than we thought.”

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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.

Why Debt Settlement is Still a Bad Alternative to Bankruptcy

September 8, 2017 Posted by kingcade

Increased regulation and enforcement has forced debt settlement companies to do what they promise in recent years, rather than charge people hefty upfront fees and fail to deliver any relief. However, debt settlement is not as consumer-friendly as the industry presents it, and many of the people who praise the companies and the process do not fully understand their alternatives or the long-term consequences of settling debts. A few of the minor consequences you might experience if you opt for debt settlement include: tax bills on the forgiven debt, a dip in credit scores and increased interest on new purchases.

Here are some of the biggest problems with debt settlement:

  • The debt settlement process takes years. Customers are told to stop paying their credit card bills, loans and other debts and put money into a savings account, however; negotiations may take years. According to the Freedom Financial Network, the largest debt settlement company, half of all customers eventually settle at least 75 percent of their debt, but the process usually takes three to four years. In the meantime, customers risk being sued over their debts. On the other hand, Chapter 7 bankruptcy halts collections activity, including lawsuits.
  • The math doesn’t add up. Debts are typically settled for 45 to 50 percent of the current balance, which is often higher than the initial balance because of late fees and interest. The average debt settlement fee is 20 percent of the debt at the time of enrollment. The amount of forgiven debt is usually reported to the IRS and is taxable as income. If the borrower is in the 25 percent federal tax bracket, the total cost of the settlement can equal 90 percent or more of the original amount owed.
  • Debt settlement companies tend to demonize bankruptcy. For example, National Debt Relief, a large debt settlement company, claims on the website, “Declaring Chapter 7 bankruptcy may mean saying goodbye to most of the assets you have accumulated over the course of your life.” However, few people who file for Chapter 7, which erases most debts in three to six months, lose any assets thanks to state laws that typically protect most if not all of what filers own.
  • Debt settlement companies also claim that bankruptcy is harder on credit scores. However, both processes often drop scores into the mid-500s. Credit scores can begin the recovery process immediately after either process is complete. The difference is that Chapter 7 bankruptcy typically takes only months to complete, while debt settlement typically takes years to complete.

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If you have any questions on this topic or are in 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.

Student Loans Vs. Other Debt: Find your Most Powerful Debt Payoff Strategy

September 1, 2017 Posted by kingcade

Many Americans struggle when trying to prioritize which debts to pay off first. Here is a helpful guide for deciding when to prioritize paying off student loans before other debts.

4 Reasons You Should Pay Down Your Student Loan Debt First

  1. You have high student loan rates. If your student loans have the highest interest rate of all your debt, that is where you should begin. You may also want to explore refinancing your student loans if you qualify for a lower rate.
  2. Your student loans have a small balance. Paying off your student loan with a small balance first is called the debt snowball method. This method allows you to see results and to stay motivated to keep up with your payoff plan.
  3. You have private student loans. Private student loans are considered “riskier” forms of debt than federal loans, which is why you should pay them off sooner rather than later. The reason they are riskier is because they do not offer the same repayment protections and options as federal loans, such as income-based repayment plans.
  4. You are close to defaulting on your student loans or declaring bankruptcy. Defaulting on a federal loan can lead to wage garnishment much more quickly than if you are not making credit card payments. Therefore, if you are struggling with student loan debt, make it a priority to make those payments first.

 

5 Reasons You Should Pay Down Other Debts First

  1. You are following the debt snowball method. The debt snowball method may lead to you paying off student loans first, however; it may also lead you to target other debts with higher interest rates or lower balances first.
  2. You value federal loan protections. Federal student loans offer repayment options and other protections that other types of debts do not offer.
  3. You hope to qualify for the Public Service Loan Forgiveness program (PSLF). The PSLF is slated to forgive federal student debt for more than 550,000 Americans, according to the Washington Post. Any balance remaining after 10 years will be forgiven to eligible borrowers. The more you pay on this debt, the less you will be left for the government to forgive.
  4. You want to improve your credit. Decreasing your debt is a good way to improve your credit score. However, certain types of debt will increase your score faster than others. Higher balances on revolving debt will give you a higher utilization ratio – which can damage your credit. If you have your credit cards maxed out, you should target this debt first.
  5. You want to claim interest tax deductions. When considering which debt to prioritize, it can help to consider the potential tax benefits you can claim. Most consumer debt cannot be claimed as a tax write-off, but student loan debt and home mortgages are exceptions.

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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 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.

How to Handle Debt Collectors When They Call

September 1, 2017 Posted by kingcade

Receiving a call from a debt collector can be stressful, especially if you are tight on money. However, sometimes collection agencies have the wrong contact information or may be trying to collect on a fake debt. Collection agencies may also use aggressive tactics to scare you into paying a debt. Here are some tips from the Better Business Bureau to help you respond to debt collectors correctly.

Your rights under the Fair Debt Collection Practices Act:

  • Debt collectors are required by law to provide information in writing. If you are contacted by a debt collector, ask to be provided with an official “validation notice” of the debt.
  • You must respond in writing within thirty days of receiving the debt notice to avoid further action by the collector. If you have proof that the debt has been paid, provide that as well.
  • A debt collector must prove that you owe the money before they can try to collect if you dispute the debt in writing within 30 days.
  • They cannot harass, oppress or abuse you. They are prohibited from swearing at you or calling repeatedly.
  • They cannot contact you at work if you tell them not to do so.
  • They cannot continue to call if you request, in writing, that they only communicate with you by mail.
  • They cannot collect a debt that you do not owe.

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If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all 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.