January 2016 - Page 2 of 3 - FREE CONSULTATION

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Discharging Student Loan Debt is Easier than You Think

Posted on January 15, 2016by Admin

Contrary to popular belief, it is not impossible to have your student loan debt discharged in bankruptcy. Findings from a study conducted by Jason Iuliano, a Harvard Law graduate and a Ph.D. candidate at Princeton reveal that 40% of those who filed received some sort of discharge from the bankruptcy court.

Iuliano reviewed every bankruptcy case involving student loan debt from 2007. Of the 169,774 student loan debtors who filed for bankruptcy, only 213 filed adversary proceedings. An adversary proceeding is a lawsuit filed within a bankruptcy case. It is also a necessary step in bankruptcy when you are seeking to have student loan debt discharged. Out of the 213 who filed an adversary proceeding, 51 debtors received a full discharge, 30 received a partial discharge and 25 received an administrative remedy.

This means that only 0.1% of those who filed for bankruptcy tried to have their student loan debts discharged and of those who tried, half of them received some form of relief from the court.

Due to the public’s perception that student loan debt cannot be discharged, most student loan debtors who are struggling with large amounts of debt do not attempt to have their loans forgiven.

Below are the steps you should take if you are considering filing for bankruptcy to have your student loan debts discharged:

Hire an attorney. Do not be discouraged if you have to meet with several attorneys before finding one who is willing to take on your case. There are some bankruptcy attorneys who do not take on cases involving student loan debt.

Do some background research for yourself. Look into some of the successful cases where the debtors experienced similar financial struggles that you are experiencing.

Try to negotiate with your lender before filing for bankruptcy. The Department of Education has issued a guidance stating when a lender should not contest a debtor’s claim of undue hardship in bankruptcy.

Bankruptcy court can be invasive. If you decide to file bankruptcy, expect that all of your finances and purchases will be questioned.

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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.

Foreclosures, Timothy Kingcade Posts

Fraudulent Debt Relief Companies Shut Down by Florida Attorney General

Posted on January 14, 2016by Admin

Attorney General Pam Bondi announced the filing of a stipulated consent judgment against Bobby R. Blackmon, Financial Help Services, Inc. and Nation Wide Consumer Debt Relief based on alleged unfair and deceptive business practices.

Blackmon’s two companies provided credit counsel management services to consumers in 48 states. Bondi presented stacks of consumer complaints stating the defendants withdrew consumers’ funds to pay creditors on a monthly basis, but did not pay the creditors within the 30 days as required by law. In some cases, the defendants did not pay the creditors at all.

Bondi and Blackmon reached an agreement that shuts down the two businesses and bans them from engaging in any consumer debt-related services. It will also cost the defendants at least one million dollars, including $600,000 in full consumer restitution. The remainder of the $7 million judgment will be suspended. However, if any of the material terms contained in the judgment are violated, the full $7 million judgment will be reinstated.

Attorney General Lisa Madigan filed a similar lawsuit in Illinois in December, suing a company called Carrey Services, Inc. and its President, Reynaldo Rojas. The “mortgage rescue” company allegedly charged struggling homeowners $20,000 in upfront fees for mortgage relief. Ultimately, the company provided little, if any, assistance to keep consumers in their homes. Madigan’s suit is seeking to shut down the business and obtain restitution for consumers.

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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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

New Bill Introduced to Stop Abusive Government Debt Collectors

Posted on January 13, 2016by Admin

New York Congressman Gregory Meeks has introduced a new bill called the Debt Collection Harmonization Act that would expand current consumer protection laws to include government debts such as speeding tickets and court fees.

Meeks’ bill is similar to the Stop Debt Collection Abuse Act introduced by Senators Cory Booker and Mike Lee. Both are in reaction to the investigation conducted by CNNMoney that found government debt collectors are not held to the same consumer protections as firms that collect debts such as credit card bills or auto loans.

Following the release of CNNMoney’s findings, Meeks was one of the first lawmakers to speak out saying, “private debt collectors often have a financial incentive to draw blood from stones, pressuring individuals to make financial commitments they cannot truly afford.”

Meeks went on to say that the investigation revealed stories from people all over the country who had been “abused by debt collectors operating under the assumed authority of state and local governments.” Debt collectors are reportedly making abusive threats of foreclosure, driver’s license suspension, wage garnishments, even arrest.

Meeks’ hopes that his new bill will put a stop to government debt collectors targeting hard-working Americans and harassing them into paying fees they cannot afford.

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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 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.

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Studies Show Cancer Survivors are at a Higher Risk of Filing for Bankruptcy

Posted on January 12, 2016by Admin

A survey of 4,719 cancer survivors, ranging from 18 – 64 years of age, showed that one third of them had gone into debt due to their illness. The study also showed that more than half of the cancer survivors’ debts exceeded $10,000. Dr. Matthew P. Banegas at the Kaiser Permanente Center conducted the survey for Health Research in Portland, Oregon.

Another study showed that three percent of cancer survivors have filed for bankruptcy due to their medical debt. The costs for curing cancer have increased two to three times faster than other healthcare costs. The costs for new cancer therapy ranges on average from $10,000 per month to $60,000 per month.

Health Affairs reported that those who were younger, had lower income and held public health insurance were at a higher risk of filing for bankruptcy.

A separate study conducted by Dr. Yousuf Zafar of the Duke Cancer Institute showed that family members of cancer survivors often had to work longer hours to make up for the loss of income. His study also revealed that one third of those surveyed had to borrow money or incurred debt due to medical bills.

Dr. Banegas said that many of the newer cancer treatments are “coming with a higher price tag.” Although there are many programs geared toward helping aid those who are battling cancer, he went on to say, “Professional societies in oncology are working toward generating this kind of information.”

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Those who have experienced illness or injury and found themselves overwhelmed with medical debt should contact an experienced Miami bankruptcy attorney. In bankruptcy, medical bills are considered general unsecured debts just like credit cards. This means that medical bills do not receive priority treatment and can easily be discharged in bankruptcy. Bankruptcy laws were created to help people resolve overwhelming debt and gain a fresh financial start. Bankruptcy attorney 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.

Debt Relief, Foreclosures, Timothy Kingcade Posts

Updates to the Reverse Mortgage Program Provide Positive Benefits for Seniors

Posted on January 11, 2016by Admin

Recent updates to reverse mortgage laws provide a more secure retirement for Americans looking to borrow against their home after leaving the workforce.

Many retirees have turned to reverse mortgages in recent years to alleviate financial stress. Reverse mortgages allow retirees, 62 and older, to borrow against the existing equity in their home and not have to repay the principal balance or accrued interest until after they pass away. At which point, their home is sold and used to pay off the remaining balance, interest and any additional fees owed to the lender.

The Reverse Mortgage Stabilization Act of 2013 helped retirees who were approved for a reverse mortgage avoid predatory lending. However, many applicants were approved for a reverse mortgage without the lender ensuring the retirees could afford to stay in their homes. Ultimately, many were unable to pay their property taxes, home insurance and other annual maintenance fees, which forced them into foreclosure.

The program’s recent updates will ensure that anyone who is approved for a reverse mortgage is able to pay the bills associated with the property. Although credit scores and income are still non-factors in the approval process, steps will be taken to ensure the insurance, taxes and other fees are paid. Another update to the law allows the non-borrowing spouse to stay in the home if the spouse who borrowed the loan passes away, first.

Experts say the new rules to the Reverse Mortgage Stabilization Act of 2013 will not only allow retirees to stay in their homes longer, but will allow for a more secure retirement.

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Bankruptcy Law, Debt Relief, Student Loans, Timothy Kingcade Posts

New York State Accepting Applications for Student Loan Debt Relief

Posted on January 8, 2016by Admin

In an effort to help ease the burden of student loan debt on its residents, New York has started accepting student loan forgiveness applications from borrowers who attended college in the state this past year.

Governor Andrew Cuomo announced the state’s “Get On Your Feet” loan forgiveness program, which allows for up to 24 months of student loan debt relief to recent college graduates. The Get On Your Feet program supplements the federal Pay As You Earn repayment program, and allows college graduates living in New York to pay nothing on their student loans the first two years out of school. The program even goes a step further by paying its residents’ student loans for a maximum of 24 payments, equal to their monthly student loan payment amount.

“With this program, we are telling recent graduates: if you invest in New York’s future, we will invest in yours,” Cuomo stated. Helping students pay for college is critical to ensuring their future success. Students struggling with student loan debt are less likely to start a small business or buy a home, and the consequences of defaulting on these loans can be devastating.

To qualify, applicants must have earned their degree from a college or university in New York no earlier than December 2014, have an adjusted gross income of less than $50,000 a year, and be enrolled in the Federal Income Based Repayment plan, Pay As You Earn.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Study reveals even those who are Insured can Face Crushing Medical Debt

Posted on January 7, 2016by Admin

According to a new study, the only way to have peace of mind when it comes to having health insurance is: Don’t get sick.

Even though the number of uninsured Americans has dropped an estimated 15 million since 2013, thanks to the Affordable Care Act, it has hardly been a safety net to millions of Americans struggling with medical debt. The new plans offered by Obamacare often require hundreds of thousands of dollars out-of-pocket, not only in the form of higher deductibles- but additional costs, like co-pays. It has caused unimaginable hardship for those living paycheck to paycheck.

Data reflects that roughly 20 percent of people under the age of 65 with health insurance reported having problems paying their medical bills over the last year. By comparison, 53 percent of people without insurance said the same. These financial vulnerabilities reflect the high costs of health care in the U.S. – the most expensive place in the world to get sick.

This shift has happened over time. Since the late 1990’s, insurance plans have been asking customers to pay more of their share of the bill, through rising deductibles and co-pays. The Affordable Care Act, signed by President Obama in 2010, protected many Americans from high health care costs by being more comprehensive, but at the same time it allowed, and even encouraged, an increase in deductibles.

Experts attribute this to “a gradual shift in the norms about the generosity of health insurance.” In more recent years, health plans have come with growing deductibles and a limited network of providers- all provisions that were devised to lower the cost of premiums. These features have made health insurance accessible to a larger share of the population, but in turn, are leaving more insured Americans vulnerable and at-risk.

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Foreclosures, Timothy Kingcade Posts

Obama Program that Hurt Homeowners and Helped Big Banks Comes to an End

Posted on January 6, 2016by Admin

The Home Affordable Modification Program (HAMP) promised to assist 3 to 4 million homeowners to modify their loans and avoid foreclosure. But nearly seven years later, less than 1 million borrowers have received assistance. In fact, nearly one in three re-defaulted after receiving their inadequate modification and 6 million families lost their homes during that same period.

HAMP’s failure essentially stemmed from its design. Rather than a cash-transfer program that hands vouchers to distressed borrowers so they can lower their mortgage payments, the government gave the money to the mortgage servicing companies, to encourage them to modify the loans.

So in the end, it’s the mortgage companies that decide whether or not to provide the aid. With servicers in control of modifications, they could manipulate the program to accumulate more bad debt on borrowers and extract a few extra payments before foreclosing.

Servicers make their money from a percentage of unpaid principal balance on a loan- so forgiving principal — the most successful type of loan modification — cuts into their profits. In addition, the mortgage servicers collect on all of the fees (i.e. – late fees, etc.), so in the end it makes it more profitable for them to keep the borrower delinquent.

70 percent of homeowners who applied for the program were turned down for a permanent modification, according to the Special Inspector General for the Troubled Asset Relief Program (SIGTARP). The government is also to blame, as it promised a $75 billion commitment to HAMP, and spent only $10.2 billion, with an additional $2 billion on related programs. Most of the spending came too late, after the initial years when the foreclosure crisis was at its worst.

In the most disturbing of revelations involving servicer misconduct, employees at Bank of America’s mortgage servicing unit testified in a class action lawsuit that they were told to lie to homeowners, deliberately misplace their documents, and deny loan modifications without explaining why. For their efforts, upper management rewarded them with bonuses, in the form of Target gift cards, for pushing borrowers into foreclosure.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

At Capital One, easy credit comes with numerous lawsuits

Posted on January 5, 2016by Admin

No lender sues more of its customers than Capital One, according to ProPublica’s review of state court data. The debt collection lawsuits target workers who earn below $40,000 a year. Unfortunately, state laws offer little protection- even workers near the minimum wage could have a quarter of their take-home pay taken or their bank accounts completely cleaned out.

ProPublica obtained and analyzed court data from 11 states, including Florida. Capital One stood out in every state for having the most number of lawsuits against its customers. For example, in Indiana counties for which court data is available — home to about two-thirds of the state’s population — the bank filed about 3,360 suits in 2014. That’s about a quarter of the suits Capital One filed in 2010, but still more suits than all other national banks combined in 2014. In Clark County, Nevada, which includes Las Vegas, Capital One’s suits comprised about 40 percent of all suits by major banks. In Miami-Dade County, Florida, the total was about the same.

The lawsuits were often over debts as small as $1,000, which reveals a hidden side of Capital One’s business. The bank has only the fourth-largest credit card portfolio, but such a large portion of its cards are held by those with poor credit that it is the country’s largest subprime lender. With those loans comes a high risk of default, and the company is particularly aggressive at recouping its losses.

Experts agree, the “disturbing” volume of lawsuits filed by Capital One should prompt regulators to investigate whether the perils of subprime credit cards outweigh the benefits. The federal Consumer Financial Protection Bureau is in the process of writing new rules for debt collection that are expected to cover a wide range of activities, including the filing of lawsuits.

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Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Bankruptcy Court Determines “Income Based Repayment” Unrealistic

Posted on January 4, 2016by Admin

Another borrower has triumphed over his student loan debt, after he filed his own adversary proceeding with the U.S. Bankruptcy Court of the Western District of Missouri. The judge in this case decided the borrower’s federal student loans should be discharged tax free in bankruptcy, allowing him to save for the future and have a better life.

In his decision, the judge looked at the “totality of the circumstances” the debtor was facing and criticized the income based repayment programs offered by the Department of Education.

The struggling borrower in this case was a truck driver who had maximized his earning potential. The public records summarized his situation by saying, “The Debtor (who represented himself) is forty years old and is unmarried. He is currently employed as a delivery driver, but at times in the past, he has worked as an over-the-road truck driver. He currently earns gross regular income of $2,420 per month, plus overtime in the approximate amount of $643 per month, for a total gross monthly income of approximately $3,063 per month. After payroll deductions for taxes, a modest retirement contribution, insurance, and child support, his net take-home pay is approximately $1,183. The Debtor testified that, due to Department of Transportation limitations on hours of service, he is unable to earn any more than what he is currently earning with the overtime, even if he took a second driving job. He also testified without contradiction that he has no job skills other than as a driver.”

Chief Bankruptcy Judge Arthur Federman noted in his opinion that Income Based Repayment Programs (IBRP) are “not the magic answer to federal student loan debt.” He further went on to say, a court, “must be mindful of both the likelihood of a debtor making significant payments under the IBRP, and also of the additional hardships which may be imposed by these programs. As stated, interest and other charges would continue to accrue while the Debtor participated in IBRP, meaning that the total debt would be increasing. The overhang of such debt could well impact not only the Debtor’s access to credit over the 25-year IBRP period, but could also affect future employment opportunities and access to housing.”

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