Bankruptcy Law

Bankruptcy Law, Credit, Timothy Kingcade Posts

Florida consumers carry 3rd highest debt in country

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Over the past few months, we have heard a lot about Americans tightening their financial belts and using extra income to pay down debts. And for some, the post-holiday period is about paying off those Christmas bills. However, new numbers released by Equifax show that many consumers, especially those in Florida, are still carrying high credit card balances.

Equifax monitors credit throughout the country. The group’s recently released numbers indicate that consumers in Florida, California and Texas are maintaining higher credit card debt levels and people in other parts of the country. While these states face some of the toughest budget issues in the nation, so do their individual residents.

According to Equifax, Florida residents have $47.6 billion of collective credit card debt. This is the third highest total in the country. California ranks highest with $90.6 billion in debt, and Texas is number two with $48.8 billion in credit card debt. These states still have “a lot of debt to tackle,” as one senior vice president at Equifax put it.

Many individuals would like to pay down their credit card debt, but it seems that each month brings new financial challenges that stand in the day of reducing debt. When credit card debt becomes overwhelming, chapter 7 bankruptcy may be a good debt relief option. In this form of debt, consumers who cannot meet their financial obligations have an opportunity to discharge unsecured debt such as credit card bills.

CreditNet, “Many Americans still face serious credit card debt problems,” Thomas Astery, 28 Jan 2011

Bankruptcy Law, Credit, Timothy Kingcade Posts

Old Video Rental Late Fees Could Impact Credit Scores

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Hollywood Video and Movie Gallery filed for bankruptcy nearly a year ago. At the time, thousands of movie renters owed the company a few dollars here or there for late fees. Now, the collections company working for the video chain has begun filing negative reports to credit agencies regarding these “outstanding debts.”

There are many things people expect to impact their credit scores one way or another, but video late fees are not one of them. At a time when many people are starting to get back on their feet, a black mark on their credit score could be very problematic. That ding to the credit report could prevent them from refinancing or getting other necessary credit.

So what is really going on in this situation? Creditors and their collections agencies do have the power to report loans that have been defaulted on, but they are generally required to notify the consumer before they do so. Many question whether or not video renters were notified before the collections company reported the debt to credit agencies.

The managing member of National Credit Solutions – the debt collection agency working with Movie Gallery and Hollywood Video – says that Movie Gallery said the company notified customers with outstanding fees before National Credit Solutions was told to report the debts. But customers say they were not notified of the situation.

Now that customers across the country have complained, Movie Gallery has asked the collections company to withdraw the negative credit reports and notify customers of the debt by mail. However, National Credit Solutions says it will be re-filing the negative credit reports if customers do not respond to the new notification.

Source: NPR, “Montana Files Lawsuit Over Video Late Fees,” Associated Press, 26 Jan 2011

Bankruptcy Law, Credit, Timothy Kingcade Posts

Credit card company tries to collect on old debts

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For people struggling with debt, receiving letters demanding payment is a frequent occurrence. But for individuals who believed their debt was “charged-off,” receiving such a letter can be a shock, especially if the creditor is now demanding payment of many years of interest.

This is the situation one couple found themselves in recently. After working hard to pay off outstanding debt, the couple thought they were positioning themselves to rebuild their credit score. Then they received a letter from Capital One requesting payment for a $2,000 credit card debt from ten years ago. The company also added interest for the past decade, and they are claiming the couple now owes more than $5,000 for that debt.

The couple has not received bills or requests for payment since 2000, and their financial counselor did not see any outstanding debt with Capital One. The couple reasonably believed that the company had written the debt off, and they no longer owed anything.

In fact, that’s true. The outstanding $2,000 plus interest is not collectible. The state in which the couple lives has a statute of limitations for collecting debts, so Capital One cannot sue the couple over this debt. But the letter demanding payment nearly tricked them into paying money they do not technically owe anymore.

According to Capital One, the company sent out this kind of demand letter to comply with a new federal regulation. Technically, creditors must send out notifications if they are still charging interest on old debts. However, the company is likely using this as an opportunity to try to convince debtors to pay back money that they no longer owe.

It is important for individuals who have received similar letters to know that they are not in danger of facing a lawsuit to collect that payment. The company can send demand letters, but they cannot legally take any action other than asking for payment.

Source: LA Times, “Capital One dredges up decade-old, charged-off debt,” David Lazarus, 1 Feb 2011

If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy and foreclosure defense attorneys at (305) 285-9100. 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, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

5 Rising Costs to Watch Out for in 2011 as You Plan Your Budget

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Budgeting: It is a word that is on everyone’s mind this year from federal and state government officials to individual households. Consumer confidence is at an extreme low during this economic recession as individuals attempt to get control of their finances, save money and reduce debt or even looking for ways to avoid filing for bankruptcy.  “Consumers are not throwing caution to the wind since there are tremendous headwinds, such as a high and persistent unemployment rate, a poor housing market, tight credit conditions, and increasing energy costs,” explained one economist with IHS Global Insight.  Although experts assure us that inflation is definitely under control, there are a few costs that will continue to rise in 2011 that will have a large affect on individuals. Five individual increases rise to the top of the list of everyday goods and services:

Food is one of the most essential needs in a household, but in 2009, the cost of groceries went up approximately 1.5 percent and is not expected to slow down. Major food producers have even begun raising food prices after dropping several discount options. Not only have food producers raised their prices, but 60 percent of restaurants surveyed by Nation’s Restaurant News said customers should expect a cost increase next time they visit.

You may have already noticed that it is getting more expensive to fill your car once again after the cost of gas seemed to waiver around a somewhat fixed point for a while. According to the Consumer Price Index, the overall cost of energy had already risen by 7.7 percent by the close of the year.

Citizens of every state should expect a change in taxes as state and government officials look to get their own budgets under control. One of the quickest ways is to increase taxes on products like cigarettes or even bottled water.
Major television and telephone service providers like AT&T are reportedly expecting to raise their monthly premiums.

And lastly, banks have had to restructure their business models as government regulations have forced them to find new ways to generate income. Several banks have already begun to consider raising fees associated with ATMs or checking accounts.

Source: The Wall Street Journal “The 7 things you’re paying more for than you think” Jennifer Waters 1/19/11

If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy and foreclosure defense attorneys at (305) 285-9100. 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, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law, Timothy Kingcade Posts

Studies Show Older Unemployed Workers Still Suffering

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Out of all of the demographic groups suffering from the current economic conditions, numbers conclude that older workers may have the toughest time adapting. Seniors have been hit the hardest by the recession, due largely to their skills being outdated and their age working against them, resulting in long term unemployment.

According to AARP, people over 55 who had lost their jobs saw their average duration of unemployment fall to 42.8 weeks in December, from 44.9 in November. Employers are often hesitant to hire applicants who have been out of work for more than a year because of stigma about unemployment. About 55.5% of all job seekers over 55 have been unemployed for 27 weeks or longer, says AARP. That’s compared with 42.4% of job seekers 55 and under.
Joblessness for older Americans could put a strain on already stressed social systems. The long-term unemployed run out of jobless benefits after 99 weeks. After that, many workers dip into retirement funds. Others apply for disability. Some apply to receive Social Security benefits early. Many seniors are left wondering, “What am I going to do the rest of my life?”

To read more on this story, please visit:
http://latimesblogs.latimes.com/money_co/2011/01/older-workers-recession.html

If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy attorneys at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Debt Relief Companies Bending the New FTC Rules

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Debt settlement companies do not have the best reputations. Horror stories of consumers paying thousands of dollars while receiving no benefit from these companies run rampant. Still, progress was made in September, with the Federal Trade Commission (FTC) imposing new regulations on debt relief and consolidation companies. These rules sought to protect vulnerable consumers looking to avoid bankruptcy and relieve their mounting credit card debt.
Essentially, the rules prohibited debt settlement companies from misleading consumers through advertisements that made outlandish claims through telemarketing, such as touting the ability to drastically cut or eliminate debts. Another important rule bans these companies from charging any upfront fees. Therefore, they are unable to collect any money before they have negotiated debts on behalf of the consumers.
If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy and foreclosure defense attorneys at (305) 285-9100. 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, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Facing Challenges After Bankruptcy

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By the end of the year, more than 1.6 million people are expected to have filed for bankruptcy protection in 2010. Many of these consumers have been financially devastated by the recession and chose to start fresh in the new year by filing for Chapter 7 bankruptcy. While filing for bankruptcy provides debtors with relief from worry and debt, it is important to keep in mind that there may be small challenges in life after bankruptcy.
Those who chose to file for bankruptcy should find comfort in numbers. Not only is the bankruptcy rate the highest it has been since 2005, a wider range of individuals are choosing to file for bankruptcy protection. Many individuals filing for bankruptcy do not hold college degrees and earn less than $30,000 a year. However, this dynamic is quickly shifting. Last year, more than one-fifth of debtors filing for bankruptcy held a college degree, representing a 4.1 percentage-point increase from 2006. Also, according to the Institute for Financial Literacy, 9.1 percent of debtors seeking bankruptcy protection in 2009 earned more than $60,000. This is compared to 5.5 percent in 2006.
If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy and foreclosure defense attorneys at (305) 285-9100. 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, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law, Timothy Kingcade Posts

Elderly Americans Increasingly Declaring Bankruptcy in Retirement

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A new trend has emerged that has identified more elderly Americans struggling under the weight of credit card debt and medical bills, causing them to resort to bankruptcy in retirement. Recent statistical data has backed these findings up, reporting that Americans 65 and older who carry a balance on their credit cards owe an average of $10,235, up 26% from 2005. These older debtors who filed for bankruptcy owed a median of $22,562 to credit card companies. The study also revealed that while multiple factors, such as health problems and medical debts, contribute to elders’ financial stress, the dominant force appears to be the overwhelming burden of credit cards. From 1991 to 2007, the rate of personal bankruptcy filings among those ages 65 or older soared by 150%, according to AARP. At the time, the biggest jump in bankruptcy filings occurred among people aged 75 to 84. Their rate skyrocketed 433%.
The study also revealed that elder debtors carry 50% more credit card debt than younger debtors. The challenge for seniors, however, is that when they run into financial trouble their options are somewhat limited, compared to the younger generation. For example, unlike younger Americans who can obtain work, put in more hours on the job, or perhaps get a second job to make ends meet, those choices do not always exist for people age 65 and older. Additionally, there are some issues confronting seniors that the rest of the population generally does not have to face. One big issue: Financial abuse by family members. Research also revealed that many elderly Americans are going broke, not just because of their own spending and high health care costs, but because their assets are being depleted by relatives or close friends who feel entitled to get an expected inheritance.
To read more on this story, please visit:
http://www.walletpop.com/blog/2010/11/22/elderly-americans-increasingly-declaring-bankruptcy-in-retiremen/
If you have any questions on this topic or are in need of a financial fresh start, please contact our experienced team of bankruptcy and foreclosure defense attorneys at (305) 285-9100. 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, P.A. website at www.miamibankruptcy.com.

Bankruptcy Law

Jury Awards Man $1.5 M after Debt Collection Agency Leaves Harassing and Vulgar Voicemail Messages

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The largest verdict of its kind was awarded to Texas resident, Allen Jones after he received a series of racist and vulgar voicemail messages from Advanced Call Center Technologies (ACT) in August of 2007. Advanced Call Center Technologies (ACT), a Pennsylvania debt collection agency began making these calls as early as 6:30 a.m. and would continue till 11:00 p.m. More egregious was the amount in question, which was a mere $200 that Jones had already paid in full. Eight messages were cited in the case and when brought to court the jury sided with Jones, awarding him $1.5 million in punitive damages, $143,000 in attorney’s fees, and $50,000 in mental anguish.
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There are several rules and regulations when it comes to collecting debt: no calls before 8 a.m. and after 9 p.m. unless agreed, no false claims, no harassment, and no unfair practices. This verdict should come as a warning to debt collection agencies that are practicing corrupt collection practices. There are strict laws against this that protect the people.
To read more on the Allen Jones story go to :
http://www.aolnews.com/nation/article/vulgar-voice-mails-cost-debt-collection-agency-15-million/19500256
For more information on your rights as a consumer, visit:
http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre18.shtm
If you have any questions on the topic of bankruptcy or feel you have been a victim of corrupt collection practices please contact me, Bankruptcy Attorney Timothy Kingcade at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. Web site at www.miamibankruptcy.com.
-Timothy Kingcade

Bankruptcy Law

Morality of Bankruptcy

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Filing for bankruptcy has often been linked with a social stigma for many individuals, often causing those who are on the verge of filing, personal guilt, fear about the future, and morality struggles. But in fact, filing for bankruptcy can often be an economically wise choice for many Americans who have found themselves in financially overwhelming situations. A recent article in the Minneapolis Star-Tribune reported that over 60 percent of all Americans who file for bankruptcy have done so as a result of excessive medical bills. This comes as no surprise to anyone who has had difficulty qualifying for health insurance or was unable to afford their monthly premiums.
At my practice, I have seen a significant increase in the number of senior citizens filing for bankruptcy as a result of having to put their monthly prescriptions on credit cards. Many of these individuals are already on fixed financial budgets and Medicare/Medicaid applies only after a certain amount is covered out of pocket. The article also noted that the average Chapter 7 bankruptcy filer has an income of only $20,000 per year, which isn’t exactly a lot of money, and can easily disappear when one is faced with an unexpected financial burden. Job loss and divorce also play a huge role in bankruptcy filings. Along with medical costs, these two factors account for the vast majority (about 90 percent) of all bankruptcy filings.
The bottom line here is that bankruptcy exists to protect those who truly need its protections. Without it, the American economy would likely not flourish with as much innovation as it does today—thanks to the security that bankruptcy provides, entrepreneurs can take risks that they might not otherwise have.
Filing for bankruptcy is emotionally and mentally exhausting. The day you hire our firm, we will contact your creditors to stop the harassment. We offer free office consultations and will listen and evaluate your individual situation, taking immediate action to help get you back on your feet. If you need relief from creditors calling and are considering bankruptcy as an option contact our experienced and compassionate team of attorneys today for a free consultation at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia, P.A. Web site at www.miamibankruptcy.info/.
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