Credit

If you file for bankruptcy and your debts are discharged, it means your debts have been legally forgiven and you no longer owe that amount. Unfortunately, many creditors fail to acknowledge this and may still attempt to collect the debt, even after a discharge. Occurrences of consumers experiencing debt collection attempts like these are a growing problem.

Sometimes debts that are forgiven by bankruptcy courts may be sold to a junk debt buyer, spawning continued harassment for consumers. In many cases, consumers wind up paying off debts they no longer owe. If a lender fails to revise their records on your credit report, this could pose a serious problem. One consumer experienced this with Capital One when he tried to secure a mortgage on a new home. Capital One demanded he pay the balance in order to proceed with the home purchase.

The law clearly defines your rights regarding debts that have been discharged in bankruptcy court. It is crucial that consumers are aware of these rights. You have the right to file a motion with the court and report the action, if a creditor attempts collection on a discharged debt. A discharge means that a permanent statutory injunction has been set in place, stopping creditors from collecting the discharged debt. Creditors who violate this injunction can face hefty fines.

Even though it is illegal for creditors to pursue discharged debts, the trend continues. In an effort to stop this and hold creditors accountable, the FTC has begun working on new regulations designed to stop creditors from going after discharged debts in court.

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.

Sources http://www.creditinfocenter.com/debt/dischargeddebtsreturn.shtml

Dealing with debt is a difficult experience for many Americans who are trying to build a better financial future. With so many different types of debt out there, there are countless resources offering helpful tips, valuable advice and endless opinions on the matter. Sadly, not all of these actually offer real debt relief options for the struggling consumer. You may not realize is that these many forms of “debt assistance” could cost you more than you think.

Common solutions include suggestions like spending less, earning more, steadily paying down each credit card from the smallest balance to the highest balance and so forth. The approach is conventional and straightforward, using a simple combination of basic math and willpower. We are told that if we keep consistently working on our debt in these ways, it will soon become manageable. However, the truth is that most of these solutions fail to outline the fact that you can still fall victim to your debts, even if you have managed to successfully pay all of them off.

Earning more, spending less, and debt roll up tactics aside; there are many resources out there that show how additional debt relief options can help you out. One half of all debt assistance programs such as debt settlement programs, credit counseling and chapter 13 bankruptcies have failed to accomplish the advertised outcome of getting consumer debts paid down to a $0 balance. Debt is more than a minor financial setback; it is a major dilemma that can lead to other, even larger problems down the road.

Choosing to go the route of consolidating your credit card debts into one payment can have shocking repercussions for those who also want to save money for their future. For example, a 30 year old consumer owing $20,000 worth of debt may opt to consolidate their credit cards through a nonprofit counseling agency. Their monthly payment may be considerably lower—only a few hundred dollars a month, spanning over 5 years. To this consumer, their total repayment amount is only a few thousand dollars more than the total debt they owed. In actuality, if that same individual had put that monthly amount in a retirement fund, they could have expected over $30,000 saved and counting until retirement age.

The same can be said for those agreeing to take a debt settlement. By accepting to pay a lesser amount through settlement, you could be stopping yourself from allowing that money to grow in a retirement savings fund. Many times, consumers sacrifice their own future financial control by seeking debt assistance that will only hinder them in the long run.

Another option that has proven to help consumers truly free themselves from debt is the option of Chapter 7. The average cost of filing Chapter 7 is between $1,500.00 and $1,800.00 and it can take as little as 90 days. The long term results from a Chapter 7 can be a full discharge of your debts and a chance to start over with a clean slate.

Filing for a Chapter 7 bankruptcy offers the advantage of the chance to start over, compared to other forms of debt relief out there. Immediate debt relief solutions can greatly compromise future plans, where Chapter 7 can provide you with the much needed opportunity to wipe out all of your debts so you can build for the future. For some, avoiding bankruptcy may seem like a winning feat, but jeopardizing your future by not filing is a losing battle.

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.huffingtonpost.com/steve-rhode/why-a-chapter-7-bankruptc_b_7232654.html

The Consumer Financial Protection Bureau (CFPB) issued a report in December, asking for stronger protections for military families. Earlier this year, NBC News reported that military families are “especially vulnerable.”

Predatory lending practices affect a large number of Americans, and currently in the U.S. house there’s an important debate about just how far these protections will go. According to The Huffington Post, Congress passed legislation in 2006 that set a 36 percent cap on interest rates for auto title loans, tax refund loans, and payday loans for military families.

In response, Lenders aptly adjusted the loan terms to avoid these limits. These terms applied to payday loans that were for 91 days or less, and the amount of $2,000 or less. For payday loans exceeding 92 days or $2,001, credit companies were still able to avoid the new rules. Larger banks skirted around the issue by creatively issuing “deposit advance products,” which operated very much like payday loans, but annual interest rates of 300%. In 2012, Congress passed another law to close these loopholes. As of September 2014, these new rules have been finalized.

Unfortunately, the problem was not completely solved because a provision was added to the military spending bill to delay the adding of any new protections for another year. Josh Earnest, White House Press Secretary termed the proposal as “shameful” and Iraq War veteran, Rep. Tammy Duckworth (D-Ill.), has led the opposition against the Republican measure.

According to the Military Times, the delay was successfully stopped by Democrats. A narrow vote among House lawmakers removed the contentious language delaying the new rules, a great relief to advocates who viewed the clause as an attempt to take away military family financial protections.

Members of the House Armed Services Committee voted 32 to 30 to strip provisions from the legislation that would have setback Defense Department plans for expanding the 2006 Military Lending Act.

Those opposing of the clause accused supporters of providing predatory lenders with more chances to oppress troops. They also feel these rules are long overdue. Banks will be displeased but Democrats, consumer advocates, and other military advocacy groups see the vote as positive news.

“Service members who are drowning in debt are a burden to the military. They are costly to manage because they need special attention. Beyond that, thousands of service men and women have already been barred from duty abroad because the debt they carried made them security risks. In other words, blocking better debt protections is a terrible idea,” said journalist and author, Brent Staples.

For now, the current crisis has been averted.

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.

Source: http://www.msnbc.com/rachel-maddow-show/house-targets-predatory-lending-protections-us-troops

A federal judge’s ruling this week will finally allow homeowners who were denied mortgage assistance from Wells Fargo to soon get the help they needed years ago. The bank’s denial of modifications to homeowners was considered a breach of the 2010 Mortgage Settlement, involving adjustable-payment mortgages.

According to Reuters, the dispute over the 2010 deal has been long-running and this breach was only the most recent development, regarding the “pick-a-payment” loans Wells Fargo inherited when they acquired Wachovia. Initially, borrowers had the choice of paying a lesser amount than the interest due on their mortgage, but payment escalation caused mortgages to grow. This contributed to the foreclosure crisis of the late 2000s.

For homeowners who had taken out the pick-a-payment loans, Wells Fargo did not grant loan modifications. Plaintiffs in the case argued that Wells Fargo had not complied with the 2010 agreement. Reuters also reported lawyers contended that thousands of borrowers were denied mortgage assistance because Wells Fargo failed to use proper methods to determine if homeowners were at imminent risk of default, effectively qualifying them for assistance.

The judge found Wells Fargo’s breach to have been done using “evolving and perhaps ill-defined standards” when deciding assistance needs. The judge’s ruling ordered Wells Fargo to find a way to correct the violations and also make preparations to allow some homeowners the chance to reapply for assistance. In two weeks time, both Wells Fargo and the plaintiffs are required to provide the court with proposals for correcting the breach.

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.

Source: http://consumerist.com/2015/04/17/wells-fargo-breached-2010-mortgage-settlement-must-work-to-provide-homeowner-assistance/

Researchers have found that congressional changes to the U.S. bankruptcy law has kept financially struggling people out of bankruptcy court, but not from going bankrupt. Because of a new study,  written by economists Jaromir Nosal of Columbia University and Stefania Albanesi of the New York Fed, the Federal Reserve Bank of New York has shed some light on why some individuals are simply too poor to file for bankruptcy.

In 2005, lawmakers made changes to the law and the cost for filing for bankruptcy became more expensive. According to the study, The Bankruptcy Abuse Prevention and Consumer Protection Act from 2005 may have eliminated the chance to start over for many who needed it.

The report clearly reveals that a “sizable group of individuals exists that does not file for bankruptcy, but seems unable to pay off their debts.” Researchers said, “These individuals are concentrated at the bottom of the income distribution, and therefore they are the ones who would be expected to benefit most from the relief offered by personal bankruptcy.” Individuals with financial troubles are less likely to have much access to new lines of credit and they also tend to have lower credit scores than those who file for bankruptcy, the study showed.

Professor Lois R. Lupica from the University of Maine’s law school conducted an earlier study and found that the cost of a Chapter 7 filing grew from $600 to $2,500. According to the numbers from the study, more paperwork, mandatory credit counseling classes and attorney fees made up most of the cost. The average rose from $663 to $986.

In an interview with The Wall Street Journal on Tuesday, Prof. Lupica agreed that the study reveals that the increase in cost has stopped people from filing. Approximately 601,000 people and couples filed Chapter 7 in 2014, far less than the 1.1 million filings recorded in 2010 from the recession-era peak, according to the U.S. Administrative Office of the U.S. Courts.

Consumer advocates who opposed financial industry lobbyists, voiced that the bankruptcy process was being abused by people who filed for Chapter 7 protection to cancel their debt, when they were able to still repay a portion of the debt over time. After an 8 year battle to reform the U.S. consumer bankruptcy laws, former President George W. Bush signed the law on April 20, 2005.

The New York Fed study stated that they are the first to focus on the individuals “who no longer file for bankruptcy post-reform.” Researchers used Consumer Credit Panel/Equifax Data from 1999 to 2013 to study and track anonymous individuals, in order to draw their conclusions. Unlike the Consumer Bankruptcy Project which houses volumes of data on people who did file for bankruptcy, this study includes those who did not file, which the academic community may find to be particularly useful.

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://blogs.wsj.com/economics/2015/04/14/too-poor-to-file-for-bankruptcy/

The amount of money owed to financial institutions is considered household debt. This can include various forms of consumer debt such as student loans, auto loans and credit card debt, as well as mortgage loans. According to the latest household debt report, released by Federal Reserve Bank of New York, balances from mortgages have increased in the fourth quarter of 2014.

The Federal Reserve Bank of New York’s report clearly shows the growing trend in borrowing and indebtedness. Also according to the report, outstanding household debt increased by $117 billion, from the third quarter of 2014. This one percent increase has placed total household indebtedness at a staggering $11.83 trillion as of Dec. 31, 2014.

Compared to the fourth quarter of 2013, total debt has gone up $326 billion. The Federal Reserve Bank of New York’s report has been based on data collected from New York Fed’s Consumer Credit Panel, with a nationally representative sample drawn from anonymized Equifax credit data.  Mortgage debt appeared to have the highest increase by $39 billion, while student loans followed closely behind with an increase by $31 billion.

Additionally, we saw an increase in auto loan debt by $21 billion and credit card debt by $20 billion. Outstanding student loan debt reached $1.16 trillion. Overall, delinquency rates for 2014’s fourth quarter remained unchanged at 4.3 percent. However, auto loans and student loan rates grew worse.

Donghoon Lee, research officer at the Federal Reserve Bank of New York stated, “Although we’ve seen an overall improvement in delinquency rates since the Great Recession, the increasing trend in student loan balances and delinquencies is concerning. Student loan delinquencies and repayment problems appear to be reducing borrowers’ ability to form their own households.”

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.acainternational.org/creditors-household-debt-continues-upward-climb-35086.aspx

Bankruptcy officials in South Florida discovered a couple was hiding assets from the courts while filing for Chapter 7 bankruptcy protection. When bankruptcy trustees paid a surprise visit to the couple’s home, they discovered a Presidential Rolex watch suddenly disappeared from the wife’s wrist. The discovery led to investigators uncovering $120,000 worth of hidden assets in the form of jewelry and artwork, all of which the couple claimed to have pawned.

The judge decided to reject the couple’s request to discharge their debts totaling $2.9 million as a result of the lies and concealing assets. Seven years after their failed attempt at filing for bankruptcy protection, the couple was charged with one count of bankruptcy fraud and sentenced to one year and one day in federal prison.

The couple still owes all of the original debts plus an additional $27,295 in restitution owed for the trustee’s services. The couple’s behavior caused them to lose their homes and their personal belongings, including family heirlooms, jewelry and clothing, much of which was auctioned off at “fire sale prices.”

This case comes as a warning to anyone considering hiding assets when filing for bankruptcy.  This can include: lying about owning assets, transferring assets into someone else’s name or creating fake liens or mortgages to make assets look as if they have no value. When you file for bankruptcy, you must disclose everything you own and all your debts, in exchange for having your debts “discharged.”  If you do not fully disclose your assets, you will not be granted a discharge.  However, this is just one of the consequences you will face.  You will also be subject to criminal penalties and will not be able to discharge those debts in subsequent bankruptcies.

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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.