Bankruptcy Law

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

Why Millennials and Gen-Xers are faced with Filing for Bankruptcy

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A recent Bankrate.com survey found that roughly 56% of millennials with current or past student loans have postponed major life events because of overwhelming debt.  While many Millennials and Gen-Xers have more debts than assets, it is important to determine whether bankruptcy is the right option.  Free advice is available through the National Foundation for Credit Counseling and consumers can consult with a bankruptcy attorney oftentimes free of charge for an initial consultation to discuss their options.

Consumers are advised to seek the advice of a credit counselor or bankruptcy attorney before they file for Chapter 7 or Chapter 13.  Filing for Chapter 7 means the unsecured debt (credit cards, medical bills, utility bills, etc.) will be discharged while filing for Chapter 13 requires consumers pay their debt for a set number of years before having a certain portion of that debt discharged.

Since changes to the bankruptcy laws in 2005, consumers now have a harder time filing for Chapter 7 and certain loans, like private and government-backed student loans are no longer dischargeable.  Consumers who file for Chapter 13 are typically on a five-year plan, having to pay back a portion of their debt.  Depending on the debtor’s income and living expenses, monthly payments can be as low as $50 a month.

Consumers should be prepared to provide documents such as paycheck stubs, tax returns and bank statements to their attorney. To receive the best interest rates possible, consumers who file for bankruptcy are advised to wait 24 months after their bankruptcy has been discharged, which means it was accepted by the bankruptcy court, to access credit again from credit card companies and some mortgage and auto loan lenders.

Rebuilding your credit score slowly is the best course of action. Examine your current household expenses, come up with a realistic budget and seek entry-level credit options to help establish a new record of timely payments.  Monitor your credit score regularly.  You can begin the process by getting a copy of your credit report from each of the three major credit bureaus: Equifax, Experian and Transunion. You can download a copy of your free credit report at www.annualcreditreport.com. As your credit improves, take advantage of opportunities to qualify for better credit terms- and always remember when it comes to credit cards, keep your balance well below the assigned credit limit.

Click here to read more on the 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.

Related Resources:

http://www.cheatsheet.com/money-career/what-young-people-cant-afford-because-of-student-loan-debt.html/?a=viewall

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

Where the 2016 Candidates Stand on the Student Loan Debt Crisis

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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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Recent Ruling to Impact Future Chapter 11 Bankruptcy Cases

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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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Tampa Bay Judges Crack Down on ‘Serial’ Bankruptcy Filers

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In the past year and a half, at least 85 Tampa Bay residents have been banned from refilling for bankruptcy, after it became evident that they did so only to save their homes.  Another 25 bay area debtors who have pending bankruptcy cases have been ordered to show cause as to why they should not be categorized as ‘abusive filers.’

Tampa Bay bankruptcy judges have had enough and are cracking down on non-lawyers who have prepared petitions for these serial filers.  To draw in new business, one preparer bragged to prospective clients that he had filed for bankruptcy six times to block foreclosure on his own home.

Debtors already barred from re-filing include:

A Palm Harbor couple who filed for bankruptcy 11 times in eight years to stop foreclosure. The bank got a final judgment against them in 2007, but repeatedly had to cancel foreclosure auctions because of all the filings.

Another Palm Harbor couple who filed 18 bankruptcy petitions over ten years. They had been living free for 12 years before the bank finally got a writ of possession in 2014.

A Safety Harbor woman who has filed seven bankruptcy petitions since 2011, including two in 2015. She has not made a mortgage payment in more than six years.

Bankruptcy judges agree that these serial filers are a ‘drain on the system’ and take time away from the legitimate cases.  Currently, there is no limit as to how many bankruptcy petitions an individual can file.  In all bankruptcy cases, it is true that as soon as a petition is filed, an automatic stay takes effect barring banks and other creditors from trying to collect debts, including mortgage debts.  At the same time, the filer must present an honest and accurate account of assets, liabilities and creditors.

There is a procedure in place to catch anyone declaring bankruptcy for a third time.  Judges can order the debtor to come to court and prove why he or she should not be declared an abusive serial bankruptcy filer.

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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

FREE help with credit problems

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Credit can be confusing, particularly if you are already overwhelmed with debt.   It is important to know that no matter how big or small your financial problems are there are resources available that can help you get back on track.

Credit counselors. Financial counseling agencies do much more than help consumers get out of debt.  Services include a budget and creditor review, housing counseling for those struggling with their mortgage or those hoping to buy a home, a one-on-one review of your credit report and much more!  These services are often free or low-cost and these type agencies always try to accommodate individuals and families with low incomes who cannot afford to pay.

Consumer Websites.  There’s no shortage of information on the Internet, but not all of it is accurate and some of it can mislead consumers.  Below are some quality resources.

  • Information published by the Consumer Financial Protection Bureau (CFPB)
  • Credit.com blog
  • The Consumer Recovery Network
  • CareConnect USA

Bankruptcy Attorney.  If you cannot see a way out of your debt, are receiving frequent calls from debt collectors or are being sued by a creditor or collector you cannot afford to pay, consider talking to a consumer bankruptcy attorney.  Most bankruptcy attorneys offer a free initial consultation / evaluation to assess your financial situation to see if bankruptcy is the best option for you.

Credit Reporting Agencies.  By law, these reporting agencies must explain information in your credit reports that you do not understand.  Additionally, you can contact the bureaus to place a fraud alert or credit freeze on your report to dispute a mistake on your credit report.  You can begin the process by getting a copy of your credit report from each of the three major credit bureaus: Equifax, Experian and TransUnion. You can download a copy of your free credit report at www.annualcreditreport.com.

Government Agencies.  You can find a wealth of helpful consumer information on the CFPB website, but more importantly, you can file a complaint or tell your story.  You can also search the CFPB complaint database to find out if other consumers are experiencing similar problems.  There are also Do Not Call list registration and resources and tools for stopping robocalls.  Telemarketing scams can cost you money and sometimes can result in new debt you must repay.

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.

Related Resources:

http://www.usatoday.com/story/money/personalfinance/2015/08/29/credit-dotcom-free-help-credit-problem/32328883/

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Can I include my payday loans in bankruptcy?

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Many individuals on the verge of bankruptcy are also trapped in an endless cycle of payday loans.  This popular source of short-term financing is easy to get, but comes with a high price tag.   Finance charges on these type loans can range from 15 to 30 percent.   That is comparable to getting a loan with an annual percentage rate of nearly 800 percent!  It’s easy to see how these loans can quickly spiral out of control.  But there’s good news- payday loans can be included in a bankruptcy filing.  These type loans are considered an unsecured debt and are dischargeable in bankruptcy.

Because of the predatory nature of many payday loans, bankruptcy courts oftentimes have little patience for the demands of these payday lenders.   However, it is important to avoid taking these loans out immediately before filing for bankruptcy.

After filing for bankruptcy, you should avoid taking out payday loans in the future.  Instead, you should consider the following alternative loan sources:

  • Local credit unions
  • Cash advance on a credit card
  • Small loans from family or friends
  • A small loan company
  • A payroll advance from your employer

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.

Related Resources:

http://www.totalbankruptcy.com/rules/can-you-include-payday-loans-bankruptcy.aspx

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

The most important price factor for insurance companies REVEALED!

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A two-year investigation of more than two billion insurance quotes from companies across the country has revealed that credit history has the biggest impact on the cost of your insurance premium. According to the study by Consumer Reports, the score can take into account what kind of credit card consumers have along with whether they have recently applied for credit.

The car insurance credit score is different from your FICO score and how it figures into your premium varies depending on the insurer and your state, according to Consumer Reports.   The insurance companies are using this score not to predict whether you are a good driver, but whether you will file a claim.

A poor credit score has caused rates to more than double in some states.  For example, in Florida, someone with an excellent credit score had a premium of $1,409.  An individual with a poor credit score had a premium of $3,826.  To put this in perspective, the premium amount for someone with a DWI who had an excellent credit score was $2,274.

Consumer Reports’ research reveals that some insurers are penalizing drivers more for having a poor credit score. If you feel your car insurance company has given you a low score, clearing up inconsistencies on your credit report can help.  You can download a copy of your free credit report at www.annualcreditreport.com.

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.

Related Resources:

http://www.wral.com/credit-history-revealed-as-most-important-factor-for-insurance-companies-/14887484/

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

NEW Rules will Boost Credit Scores for Millions

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If unresolved medical bills are keeping your credit score low, there’s good news.  Changes are coming this fall to Fair Isaac’s FICO Score, which will take a closer look at unpaid medical bills and accounts sent to collections.  Consumers whose only negative mark is from medical debt can expect their credit score to increase by 25 points.

These new rules are far reaching, as more than half of all debt on credit reports is from medical bills, according to the Consumer Financial Protection Bureau (CFPB).  The changes also expand banks’ abilities to offer loans to borrowers who may not have otherwise qualified.

In July, approximately 64.3 million U.S. consumers had medical debt on their credit reports, according to the credit bureau Experian. Of 106.5 million total consumers with agency collections on their reports, 9.4 million had a zero balance. Under the new credit score system (FICO Score 9), those consumers will not be penalized.

The changes come as a result of an agreement between the three major credit bureaus using FICO scores- Experian, Equifax and TransUnion.  In addition, delinquent medical bills will not be reported to credit bureaus for six months.  This is another win for consumers, allowing them time to pay claims and resolve disputes with their insurance company.

While these changes make it easier to qualify for a loan, it is important consumers keep their debt-to-income ratio under 43 percent.   This is the highest ratio a borrower can have and still qualify for a mortgage in today’s market.

The CFPB gives the following debt-to-income ratio example:

If you pay $1,500 a month for your mortgage and another $100 a month for your car loan and $400 for your remaining debts, your monthly debt payments total $2,000.   If your gross monthly income is $6,000, then your debt-to-income ratio is 33 percent.

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.

Related Resources:

http://www.moneytalksnews.com/new-rules-may-boost-your-ailing-credit-score/

Bankruptcy Law, Credit, Student Loans, Timothy Kingcade Posts

The Affects Bankruptcy has on Children

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Filing for bankruptcy can be a challenging time, especially for those who have children.  However, sometimes it is the only option. Below is a detailed look at the impact bankruptcy can have on children.

Child’s Property Status

Any property you have purchased for your child, including: clothing, furniture, toys, books, etc. is considered your property in a bankruptcy case. However, it will not be included in your bankruptcy estate if you are able to prove that the property was purchased with your child’s income. This would apply if your child received funds from employment or other form of income. Receipts from your child’s bank account are also helpful in excluding the property from your bankruptcy estate.

Child Support Income

In the State of Florida, child support income is exempt in bankruptcy, if it has been saved in a bank account. Again, receipts are important to prove that the money in the account is indeed child support income.

Child’s Financial Assets

Any bank accounts or college savings accounts that are in your child’s name are exempt in bankruptcy.   These include custodial bank accounts and 529 college savings accounts.  Any deposit made to the account less than 365 days before filing bankruptcy may be seized by the bankruptcy trustee and used to repay creditors.  Fortunately, any deposits made between 365 to 720 days or more prior to filing bankruptcy are exempt.

School Tuition and College Student Loans

$1,875 in educational expenses is usually allowed for minor children of bankruptcy filers. While college-aged children will still be able to take out  student loans, you will be excluded from taking out loans on their behalf, after filing for bankruptcy. It is always best to speak with your bankruptcy attorney to explore how trustees view tuition payments in your area.

If you are in a financial crisis and are considering filing 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.

Source:

https://www.myhorizontoday.com/bankruptcy101/how-does-bankruptcy-affect-my-children/

Bankruptcy Law, Timothy Kingcade Posts

Rising Bankruptcy Rates in America

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Hundreds of thousands of Americans file for bankruptcy every year.  Although a bankruptcy can remain on your credit report for up to 10 years, there are times when taking this route is the most efficient and effective way to get out from under insurmountable debt and gain a fresh financial start.

Last year, 898,970 non-business bankruptcy filings were made in the U.S. This was the equivalent to a rate of 2.8 people in bankruptcy per 1,000 people. According to data from the Administrative Office of the U.S. Courts, Tennessee had the highest bankruptcy rate with 5.89 people per 1,000.

Filing for bankruptcy is not a decision to be made lightly. Before you file, it is important to explore all of your options.   Experts warn not to wait too long because this will only prolong your financial struggle.

Below are some tell-tale signs that indicate bankruptcy may be the best choice for you:

  • Your debt balances grow, despite making payments;
  • You are using retirement or savings to cover your debt payments;
  • You are struggling with an underwater mortgage;
  • Family members or loved ones are at risk if you do not address your debt.

Upon deciding to file, you will soon realize the many ways bankruptcy can help you. Depending on the type of bankruptcy you file, you may be able to discharge most or all of your debt, or arrange for a manageable re-payment plan. After filing for bankruptcy, consumers should begin practicing positive credit habits and focus on rebuilding their credit slowly.

If you are in a financial crisis and are considering filing 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.

Source:

http://www.msn.com/en-us/money/credit/the-states-with-the-highest-bankruptcy-rates/ss-BBjewMi#image=1