Credit

Bankruptcy Law, Credit, Timothy Kingcade Posts

A New Ruling Requires Lenders Show Consumers their Credit Score

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A recent ruling now requires lenders who deny a borrower credit or offer a higher-than-normal interest rate show the borrower their credit score.  The new rule is part of an amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act that was passed one year ago.   The law requires creditors to provide additional information in adverse action notices if a credit score was used in making a credit decision.

A poor credit score can impact your ability to get a car loan, prevent you from being approved for a home mortgage, and can mean higher interest rates and less than favorable loan terms.  This new law adds a level of protection for consumers, giving them access to crucial information that will give them the facts needed to make a change in their spending habits or seek debt relief alternatives. Fair Isaac and
Company, or FICO, the developer of the software that generates most of the credit scores used by U.S. lenders, estimates the new provision will result in more than 500 million credit score disclosures each year.
To read more on this story visit:

http://abcnews.go.com/Business/credit-score-rule-takes-effect-today/story?id=14118699

At Kingcade & Garcia, P.A. we help clients analyze their finances and determine the best path to debt relief. This past year our firm handled more than 1,500 bankruptcy cases, bringing debt relief to individuals, families and business owners throughout South Florida. If you are struggling with insurmountable debt do not wait any longer, set up your FREE office consultation today by calling (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

What Debt is Dischargeable through Bankruptcy?

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Bankruptcy laws specify that only particular types of debts can be discharged through bankruptcy. Chapter 7 and Chapter 13 bankruptcy allow borrowers to eliminate their unsecured debts. Unsecured debts include items such as credit card debt, medical bills, utility bills, service bills, personal loans, payday loans and judgments. Secured debts which are backed by some form of collateral, like a house, and debts incurred through fraudulent activity, student loans, tax debts, child support and alimony are typically not dischargeable in bankruptcy.

When you hire Kingcade & Garcia, P.A. our attorneys will provide a complete evaluation and give you an honest and accurate assessment of your financial circumstances. We help clients analyze their finances and determine the best path to debt relief. This past year our firm handled more than 1,500 bankruptcy cases, bringing debt relief to individuals, families and business owners throughout South Florida. If you are struggling with insurmountable debt do not wait any longer, set up your FREE office consultation today by calling (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

Gamblers in Debt have Luck on their side as a result of New Bankruptcy Laws

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In the past, bankruptcy courts have found gambling debts as non-dischargeable. However, due to recent changes in the law, gambling debts owed to a casino can be eligible for debt discharge through bankruptcy. Gamblers often get trapped in a vicious cycle, taking cash advances in the hope that future earnings will pay them off. Gambling can be a slippery slope and can lead to addiction and financial devastation. However, gamblers have some luck on their side if they take advantage of the current bankruptcy laws, as a Chapter 7 bankruptcy filing can eliminate gambling debts.
At Kingcade & Garcia, we understand the need for a legal means of escaping overwhelming debt. What if you could eliminate your gambling debts and take a huge step toward taking control of your finances and your life? By taking advantage of our free consultations and speaking with our experienced team of bankruptcy attorneys, you can.
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. 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.

Credit, Foreclosures, Timothy Kingcade Posts

A Borrowers’ Bill of Rights

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Recent “robo-signing” and foreclosure scandals suggest that for thousands of homeowners, fairness and competency have not been so readily available. According to witnesses at recent congressional hearings, borrowers with on-time payment histories who sought loan modifications frequently were told they needed to stop payments for two to three months before they would be eligible to even discuss changes to their loan terms. When these individuals and businesses applied for modifications, they were sent foreclosure notices because they were in default.

It’s also suggested that servicers “pyramid” late fees and sloppy documentation, have had an increasing affect on borrowers’ debts to the point where foreclosure has become inevitable.
Some of the most blatant errors involve property insurance records. According to the National Consumer Law Center, $30,000 in fees were added to one homeowner’s principal balance by a bank during the seven months it took to process the modification request. It is reported abuse such as this that’s led to hundreds of lawsuits against banks and servicers that are clogging court calendars nationwide. This has prompted state attorney generals to negotiate a national settlement with the 14 biggest banks and servicers.

The draft proposal calls for billions of dollars in penalties from the banks along with additional billions in principal reductions for distressed and underwater borrowers. The core of the agreement would essentially amount to a new mortgage servicing bill of rights for borrowers. It sets out minimum standards and operating procedures that would govern how homeowners are treated in the future.

Below is a quick overview of the proposed “borrowers’ bill of rights”:

• Servicers would be required to employ enough trained loss-mitigation staff to deal with all borrower inquiries and request for loan modifications

• Servicers would be required to identify the bank or investor that is the legal owner of the mortgage

• Servicers will have to provide mortgage customers with a “single point of contact” – a designated employee, with a name and contact information – for their loan modification requests

• Dual-tracking of modifications and foreclosures would be banned

• Servicers would be prohibited from advising on-time customers to default, or discouraging borrowers from seeking help from non-profit counseling organizations.

• “Force-placed” insurance practices would be severely limited, including prohibitions on obtaining high-premium policies from subsidiaries, affiliates, the lender or servicer

If the proposed settlement occurs, it could give significant new protections to homeowners and borrowers, even for those that never had a payment problem or a need to modify their mortgage terms.

To read more on this story, visit:
http://www.miamiherald.com/2011/03/20/2119880/a-borrowers-bill-of-rights.html

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, P.A. website at www.miamibankruptcy.com.

Credit, Timothy Kingcade Posts

Former NFL star filed bankruptcy before committing suicide

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There used to be a stigma about bankruptcy, but that stigma is long-since gone. In today’s economy, people from every walk of life have filed for bankruptcy to get relief from overwhelming debt. Now it has been announced that even former football stars have turned to bankruptcy.

On Thursday, Dave Duerson left a note behind asking that his brain be tested for chronic traumatic encephalopathy (CTE) before he committed suicide. The 50-year-old former NFL star was experiencing many personal struggles before his death, including financial problems. In September of last year, he filed for bankruptcy after a series of unfortunate financial struggles.

Just like many people, Duerson found himself unable to pay his credit card bill, mortgage and other debts. However, his road to bankruptcy was unique. After his football career, Duerson purchased multiple McDonald’s franchises. Later, he sold the restaurants to purchase a sausage company that supplied meat to McDonald’s.

The outlook was positive, and Duerson’s food company built a state-of-the-art meat production plant. However, the opening of the plant was delayed because of freezer problems. Those problems caused the bank to revoke his line of credit for the company.

Duerson took out a second mortgage on his home to get things started at the meat company. In the meantime, he sued the freezer company and was awarded a judgment for $34 million in 2004. But the freezer company has yet to pay him.

Now, the man was left with two mortgages on his home and mounting bills. The bankruptcy filing listed $34.6 million in assets, but much of that is made up of the judgment owed to him by the freezer company. He also listed nearly $15 million in liabilities. Those liabilities are owed to secured and unsecured creditors such as the mortgage lender, his former spouse, the State of Wisconsin and a bank that issued him a credit card.

This story is an example of how even a successful NFL star can find himself facing financial problems that are not entirely of his own making.

Source: Chicago Breaking Business, “Bears’ Duerson had pending personal bankruptcy,” Becky Yerak, 21 Feb 2011

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, 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.