Bankruptcy Law Archives - Page 70 of 128 - Kingcade Garcia McMaken, P.A. Bankruptcy Attorneys

U.S. District Court in NY Grants Debt Collector Motion to Certify Important FDCPA Issue

Posted on May 16, 2016by Admin

In an Order dated this month, a Federal Judge in New York determined that a decision he rendered in the matter of Halberstam v. Global Credit and Collection Corp.(U.S. District Court, ED, NY, 15-cv-5696 (BMC) be certified for an immediate interlocutory appeal.

The Fair Debt Collection Practices Act (FDCPA) case involved leaving a message with a person who answers the debtor’s phone. The issue presented in the case was whether a debt collector, whose phone call to a debtor is answered by a third party may leave his name and number for the debtor to return the call- without disclosing that he is a debt collector – or whether the debt collector must refrain from leaving call back information and simply attempt to make the call at a later time.

In the May 5, 2016 Memorandum, Decision, and Order Judge Brian M. Cogan wrote:

“I had no doubt, and I remain of the view, that the purpose of leaving such a message was to induce plaintiff to return the collection agent’s call without knowing that he was calling a collection agent. Describing the purpose of the call to a third party as a “personal business matter” was at least as suggestive, and probably more, of a business opportunity for plaintiff to make money as it was of its true purpose, which was to cause plaintiff to pay money. I granted summary judgment for plaintiff because I found that by leaving a message for plaintiff with a third party that was calculated to induce a return call without the debtor knowing that he would be calling a collection company, defendant violated section 1692c(b) of the Fair Debt Collection Practices Act (“FDCPA”).

The Fair Debt Collection Practices Act (FDCPA) was designed to help prevent creditor abuse and harassment.

Further, the issue of whether leaving a message with a third party violates the FDCPA has the potential to impact a large number of other cases, as well as debt collection practices more generally.”

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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.

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Reverse Mortgage will likely be modified

Posted on May 12, 2016by Admin

A reverse mortgage payable upon the pre-petition death of the borrower has been modifiable under section 1322(c). Section 1322(c) provides an exception to the anti-modification provision of section 1322(b) in the case of a debt secured by the debtor’s residence when the final payment comes due during the life of the chapter 13 plan.

In re Michaud, No. 14-23406 (Bankr. S.D. Fla. March 29, 2016), Julie Lisana Michaud sought to strip down the reverse mortgagee’s (James B. Nutter & Company) interest in her principal residence to its value at the time of her chapter 13 petition.

The reverse mortgage agreement was entered into by Ms. Michaud’s husband who died prior to her bankruptcy filing. By the terms of the reverse mortgage, the debt became due and was owed upon the death of Mr. Michaud. The agreement further stated that the full debt “if not paid earlier, would be due and payable on May 29, 2095.”

The issue at hand is whether the final payment became due when Mr. Michaud died, as argued by Ms. Michaud, or on May 29, 2095, as argued by Nutter. In the end, the court rejected Nutter’s due date based on “common sense,” finding the 2095 due date to be meaningless as the mortgagor would certainly pass away before that date.

The court also went by the terms of the lending agreement and federal regulations. By the terms of the agreement, the death of the mortgagor accelerates the due date without regard to the date listed in the agreement. Finally, federal regulations, provide that reverse mortgages become “due and payable” when “(i) The consumer dies; (ii) The dwelling is transferred; (iii) the consumer ceases to occupy the dwelling as a principal dwelling.” 12 C.F.R. §226.33.

Nutter countered with a “slippery slope” argument that debtors could use the ruling to their advantage when the debtor has caused the acceleration by his or her own default such as by failure to maintain insurance on the property, which the court rejected.

The court granted Ms. Michaud’s motion to value for a secured claim in the amount of $45,500 plus interest, and an unsecured claim of $67,096.75.

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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

The FCC Wants Debt Collectors to Stop Calling So Much

Posted on May 11, 2016by Admin

The Federal Communications Commission (FCC) recently approved a proposal that would reduce the number of collection calls consumers receive. A budget deal was approved last year that provided government exemptions from the Telephone Consumer Protection Act that blocks solicitors from sending automated calls to cell phones under certain conditions. Congress called on the FCC to limit those exemptions.

The proposal limits government debt collectors to three calls per month, which can only be made if an individual is late on making a payment. It also allows calls informing people about payment plans, though borrowers can request to opt out.

With taking this first step toward implementing the requirements, Congress recognizes the importance of collecting debt owed to the U.S. and respecting the consumer protections allotted in the Telephone Consumer Protection Act. It is still subject to two rounds of comments- the first on June 6, and the second on June 21.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Payday Loan Changes Coming to Florida

Posted on May 9, 2016by Admin

Payday loans are quick cash that come with steep consequences, oftentimes the interest rate on payday loans can easily reach triple digits. However, for many individuals and families living paycheck-to-paycheck, it’s the only way to make ends meet. Tens of thousands living in Florida rely weekly on payday loans.

Payday loans are short-term and often paid off as soon as the borrower receives their next paycheck. But between the high interest rates and fees, this quick cash comes with a hefty price tag. Annual percentage rates can soar as high as 400%! This month the federal government is expected to impose national standards and limits on payday loans.

Consumer counselors agree that payday loan rules not only keep lenders in check, but protect people from getting in over their heads. In Florida, about 7% of the population relies on payday loans. That is one of the highest rates in the nation. There is also concern that if federal guidelines make the rules too strict, people who actually need the cash in a crisis – for example, to pay for a car repair or medical bill – may not be able to get it.

The question now is whether the new federal rules would strengthen, weaken, or leave in place what the state has already established.

Payday lending is limited in several ways in Florida. The law places limits on:

the amount of the loan ($500);
the number of loans you can have outstanding (only one at a time);
the length of the loan term (cannot be for less than seven days or more than 31 days);
the fees and costs that can be charged (interest is capped at 18%), and
the collection process if you do not pay.

To learn more about Florida’s payday loan laws, click here.

Bankruptcy Law, Credit, Debt Relief

Consumer Financial Protection Bureau Takes Action against Debt Collection Agencies Auto-Suing Borrowers

Posted on May 4, 2016by Admin

The Consumer Financial Protection Bureau (CFPB) has ordered two debt collection firms to stop an illegal collection operation that used automated lawsuit generator. The law firm- Pressler & Pressler, LLP and debt buyer- New Century Financial Services, Inc. have been harassing consumers with lawsuits often based on “flimsy or nonexistent evidence.”

“For years, Pressler & Pressler churned out one lawsuit after another to collect debts for New Century that were not verified and might not exist,” said CFPB Director Richard Cordray in a press release. “Debt collectors that file lawsuits with no regard for their validity break the law and violate the public trust. We will continue to take action to protect borrowers from abuse.”

The lawsuits were allegedly manufactured by an automated system unsupervised by a lawyer, but rather untrained support staff, which spent less than 30 seconds on some cases to verify the claims of each lawsuit.

The CFPB found that the lawsuits violated the Dodd-Frank Act on three counts: making false or empty allegations about consumer debts, filing suits with bad information, and harassment with “unsubstantiated court filings.” The civil penalties include $2.5 million to $1 million for the law firm and $1.5 million for the debt buyer.

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

Vermont House Asks Congress to Allow Students to Discharge Student Loan Debt in Bankruptcy

Posted on May 3, 2016by Admin

With national student loan debt increasing to more than $1 trillion and Vermont’s graduates stuck with the highest debt-to-earnings ratio, state lawmakers are urging Congress to let students file for bankruptcy to discharge their student loan debt.

This week, members of the Vermont House gave preliminary approval to J.R.H. 27, a resolution that calls for “federal action to alleviate the national student loan debt crisis.” Federal bankruptcy code prohibits student loan debt from being discharged in bankruptcy, except in cases of “undue hardship.”

“The General Assembly requests Congress to amend the federal bankruptcy code to eliminate the prohibition on relief from federal or private student loan debt through the federal bankruptcy system,” the resolution states.

J.R.H. 27 illustrates the scope of the problem. Student loan debt tripled between 2005 and 2015, increasing to $1.19 trillion, according to the Federal Reserve Bank of New York’s Consumer Credit Panel. Nationwide, almost 7 million student loan borrowers, or 17 percent, are in default as of summer 2015. This is up 400,000 defaults, or 6 percent, compared to 2014.

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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.

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Lawsuit Alleges Orlando law firm violated rules on bankruptcy fees

Posted on April 29, 2016by Admin

The KEL law firm is facing a lawsuit alleging it routinely allowed clients to pay bankruptcy legal fees using credit cards, a violation of bankruptcy law. Credit card purchases are considered new debts and new debts are prohibited in the days before filing for bankruptcy and during the bankruptcy process. That is because bankruptcy courts often erase a filer’s credit card debt, which means the nation’s banking system would be on the hook for KEL’s legal fees.

The suit, which seeks class-action status, contends that KEL “uses standardized procedures when attempting to collect attorney’s fees by charging credit cards prior filing Chapter 7 bankruptcy.” It seeks the return of all bankruptcy fees paid by credit card—the amount of which is cited at $1,700 in the suit—and $1 million in punitive damages.

The lawsuit states an Orlando resident paid his bankruptcy fees to KEL using a Discover credit card and a BJ’s credit card. During the course of the filing, the debtor decided to switch to a new law firm, which noticed the prior fee payment on the credit cards to KEL. Jacksonville law firm Mickler & Mickler filed the proposed class action on behalf of the debtor.

Related Resources:

http://www.abajournal.com/news/article/ex_client_sues_law_firm_says_it_allowed_bankruptcy_fees_to_be_paid_by_credi

http://www.orlandosentinel.com/business/brinkmann-on-business/os-kel-firm-bankruptcy-fees-lawsuit-alleges-20160420-story.html

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

How quickly can you refinance your Mortgage after Bankruptcy?

Posted on April 28, 2016by Admin

The rules have changed over the years regarding how quickly you can refinance a mortgage after bankruptcy. If you are underwater on your mortgage, meaning your mortgage is more than the current value of your home, your only refinance option will be through the Home Affordable Refinance Program (HARP). The earliest you can take out a new mortgage guaranteed by Fannie Mae or Freddie Mac following a bankruptcy is two years.

Freddie Mac’s guidelines say, the “waiting period” for reestablishment of credit after a Chapter 13 bankruptcy is 48 months from the dismissal date, but this period is only in effect if the bankruptcy was “caused by financial mismanagement.”

If the bankruptcy was due to illness, income loss, etc. and not due to overspending, the period will be 24 months from the discharge date. Fannie Mae has similar rules in effect of two years from the discharge date or four years from the dismissal date.

If you are unable to meet Fannie or Freddie’s guidelines, you may be eligible for an FHA-backed refinance. You will need to document “one year of the pay-out period under the bankruptcy has elapsed, that your payment performance has been satisfactory and all required payments have been made on time, and you have received written permission from the bankruptcy court to enter into the transaction.”

This one-year waiting period is thanks to the “Back to Work Program.” Here’s how you qualify:

You meet all the typical FHA loan requirements;
You can properly document the issues that led to your financial hardship;
In the last year you have re-established your credit;
You have completed HUD-approved housing counseling.

What about refinancing while you are still in bankruptcy? For starters, the bankruptcy court will need to grant you permission to take on new debt. To be able to proceed, you will need to file a motion with the court. Although described differently in each court district, you are essentially filing a “motion to incur debt” or “motion to refinance secured debt.”

Start by working with the attorney who handled your bankruptcy filing, they will be familiar with your case and know the motion paperwork needed in your district.

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

Murphy Bill will Stop Garnishment of Social Security Benefits to Pay Student Loans

Posted on April 27, 2016by Admin

A bill has been introduced by U.S. Representative Patrick Murphy that will prevent social security benefits from being garnished to repay student loan debt. Murphy says it is a problem that needs to be addressed and believes expanding higher education opportunities and protecting Social Security benefits are key to bolstering the middle class.

In the fiscal year that ended in October, 860,000 individuals had their Social Security benefits reduced to pay for federal debts, with the federal government collecting $382 million, according to the Senate Finance Committee. This number included attempts to collect other debts besides student loans.

According to the General Accountability Office, the number of people whose Social Security benefits were reduced specifically to pay off student loan debt increased from 31,000 in 2002 to 155,000 in 2013. The numbers for those older than age 65 increased from 6,000 to 36,000 in the same period. Some of those were paying down debts incurred to educate their children through co-signing or Parent PLUS loans. In fact, people older than 65 owe $18.2 billion on student loans.

The Murphy Bill is a step in the right direction, but still falls short by failing to alleviate the debt for seniors. Consumer advocates believe the real solution is a change in the law to permit unsustainable student loan debts to be discharged in bankruptcy.

Click here to read more on this story.

Bankruptcy Law, Foreclosures, Timothy Kingcade Posts

Homeowners BEWARE: The Latest Foreclosure Rescue Scam- Securitization Audits

Posted on April 26, 2016by Admin

There are many struggling homeowners on the brink of foreclosure, and scammers have been there to capitalize on it, offering “mortgage elimination” or other foreclosure tactics that in some cases are illegal. One commonly advertised service is a Securitization Audit.

A number of companies have been pushing “forensic loan audits.” Since knowledgeable attorneys and homeowners recognize these “audits” are basically useless, scammers are now peddling, securitization audits. The supposed reason given for a ‘securitization audit’ is to determine the true owner of a promissory note. Allegedly, with this information, the homeowner can show a court that the party actually foreclosing on a mortgage is not the actual note owner.

These scammers are charging fees for information that is free to everyone. There is absolutely no need to pay for a securitization audit, but the scammers are counting on the fact that the average homeowner does not know that.

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