Debt Relief Archives - Page 23 of 86

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

What Trump Has Done to Undermine Student Loan Debt Reform

Posted on September 6, 2018by Admin

Student loan debt has skyrocketed since President Trump took office. In fact, the amount of student loan debt has increased by $110 billion in the last 16 months to a total of $1.41 trillion nationwide. It is currently estimated that 45 million Americans have student loan debt and this figure is up two million since Trump’s inauguration.

Not only has the number of student loan borrowers increased rapidly, but actions taken by the Trump administration have raised major red flags with those who have fought for student loan reform for years. The Trump administration has methodically dismantled effective debt relief reforms set by the Obama administration in their efforts to curtail abusive lending practices.

During the Obama administration, the student loan industry was forced to give back approximately $750 million in what was found to be abusive marketing and collection practices targeting student borrowers.

Further, the Department of Education Secretary appointed under Trump, Betsy DeVos, has been moving to eliminate Obama-era rules that penalize lenders who engage in abusive student loan debt collection practices.

One of the major changes made by the Trump administration was through the reorganization of the Consumer Financial Protection Bureau (CFPB) and its student loan office. The administration argued this reorganization was routine and made no major change to the agency.

However, one of the major changes was made to the student loan debt office’s watchdog or ombudsman function. This specific office was created to address payment difficulties student loan borrowers were facing. By the time the borrowers got to the point where they were reaching out to this office, they were fielding numerous phone calls, many of them harassing and threatening, as well as lawsuits and collections cases. Other borrowers accused lenders of misleading them about any eligibility for debt relief programs, assistance that is meant to lower the borrower’s payments or have their loans forgiven.

The student loan office was key in a major lawsuit against Navient, Inc., a major student loan service provider and former division of Sallie Mae. Navient was accused of convincing borrowers to go into expensive repayment plans without telling them of more reasonable and cost-effective options. A trial date has not yet been set, which leads many to question whether one will ever be set.

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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. There are ways to file for bankruptcy with student loan 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 McMaken 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 McMaken website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Credit Card Debt, Debt Relief

Credit Card Debt Increasing at An Alarming Rate for the Floridians

Posted on September 5, 2018by Admin

Credit card debt is a problem for many Americans across the country, but for Floridians, this problem is growing at what experts say is an alarming rate. According to recent figures released by the credit reporting agency, Experian, Floridians are using their credit cards more than ever, increasing their debt at the nation’s second fastest rate.

The State of Nevada tops the list of states with the highest credit card rate, but Florida is a close second. In fact, credit card balances have increased 8.59 percent as compared to the same time last year. Currently, the national average is at 6.58 percent, and Florida’s rate is well above this national average.

According to Experian, credit card debt nationally is at an all-time high, reaching $786 billion by the end of 2017. It is up 6.7 percent from 2016. The average American holds a credit card balance of $6,354. The use of store credit cards, mortgage debt and debt overall also increased approximately three percent.

Credit card debt can be a slippery slope and is one of the most common problems facing those with serious financial issues. With exorbitant interest rates, fees and penalties, making only the minimum payment does not even begin to make a dent in the total balance.

Credit card companies design fee and repayment structures to keep you from ever getting out of debt. An unexpected job loss or serious medical diagnosis, even a trip to the emergency room can put significant financial strain on individuals and families who are already facing mounting credit card debt.

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If you have questions on this topic or are in 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 McMaken 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 McMaken website at www.miamibankruptcy.com.

Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

The Truth About Credit Card Debt Forgiveness

Posted on August 31, 2018by Admin

The thought of having your credit card debt completely forgiven can seem too good to be true. However, like so many things in life, if it sounds too good to be true, it probably is. The truth is, debt settlement comes with its own set of unintended consequences.

If a consumer is not able to pay off a credit card balance and has missed a number of payments, that person may choose to either work directly with the credit card company- or if the debt is sold, a third-party debt collector to settle payment. Credit card companies want to receive payment at the end of the day, and they are willing to accept less than what is owed in lieu of not receiving payment at all if the debtor chooses to file for bankruptcy and have the debt discharged.

The problem with debt settlement involves the consequences that come along with settling your credit card debt. For one, even if the balance is settled, it can still have a negative impact on a consumer’s credit score. In addition, if the amount that originally was owed is a lot more than the amount that ended up being paid, the difference is still considered taxable income by the IRS and state government, which means the consumer will have to pay taxes on the forgiven debt.

If you are successful in negotiating the amount with the creditor, make sure these agreements are in writing and be wary of any plans that seem too good to be true. If you are receiving collection calls, unable to make payments, facing wage garnishment or have a lawsuit pending with a creditor, it is important to at least sit down with an experienced bankruptcy attorney, who can advise you of all your options.

Consumers should avoid working with debt settlement companies. The cons often outweigh the pros, as many of these companies engage in unfair practices, require their clients pay large upfront fees and result in a consumer’s credit being irreparably damaged, and still left with debt.

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Debt Relief, Student Loans, Timothy Kingcade Posts

Women Hold the Majority of Student Loan Debt

Posted on August 30, 2018by Admin

When it comes to who holds the most student loan debt, a recent report issued by the Federal Reserve showed that women carry the highest burden. According to the Federal Reserve data, the total amount of student loan debt is now around $1.52 trillion as of March 2018. Of this amount, women carry $900 billion.

Experts believe that this number is because more women are now attending college than men. According to the American Association of University Women (AAUW), 56 percent of college enrollees in the fall 2016 semester were female. In 2017, it was reported that 57.3 percent of college enrollees were females, which indicates an upward trend.

The data also indicated that women were more likely than men to take on student loan debt. According to the AAUW data for the 2015-2016 school year, 41 percent of all female undergraduate students signed onto a new student loan debt to go to school. Only 35 percent of male undergraduate students did in comparison. Of course, the numbers varied depending on the type of degree being sought, where the student went to school and the degree levels.

Not only were more female students taking out student loan debt, but the loan balances were higher for female students. In fact, the numbers showed that the female student loan balances were 14 percent more than their male counterparts. The female students ended up with around $2,700 more in student loan debt upon graduation than their male colleagues. It could be because the female students were reported as pursuing a graduate degree after undergraduate studies were complete, which only added to their already higher balances.

The problem with these numbers is once women graduate from college, the pay gap that exists between the two genders makes it harder for them to pay off their debts. According to Pew Research, women only make 82 cents for every dollar a man makes in the workforce. Women are also more likely to take time off from their careers to have children and raise a family, only returning to the workforce after the children are grown, which also puts them at a disadvantage for catching up to their male counterparts in income and in paying off their student loan balances.

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

Millennials Acquiring More Debt, Less Stuff

Posted on August 21, 2018by Admin

Millennials are entering the workforce with more student loan debt than ever before. They may be earning more in terms of income, but a large percentage of their paychecks are dedicated to their student loan payments. After making those required monthly payments, all they have left goes towards daily living, healthcare and rent. They end up having less to spend on discretionary items, such as travel, eating out or clothing.

In fact, Americans ages 18 to 29 are spending $20 less daily than this same age group did ten years ago. The reason for this difference in spending is the amount of debt Millennials carry.

According to a recent Bankrate study, Millennials are spending more on bills and less on discretionary items than other generations. On average, Millennials spend 15 percent more than older generations on necessities, such as gas, food or other utility bills.

Here are some tips for millennials struggling with student loan debt:

Know what you owe.
Millennials who have graduated and have jobs often qualify for better rates than when they had little to no income at the start of school.
Get help at work. Certain companies offer student loan repayment assistance, including Fidelity, Aetna and PwC, and others.
Seek forgiveness. Certain professions, such as public service jobs, offer student loan forgiveness. Others include public defenders, law enforcement officers, doctors, nurses and some teachers. For example, teachers who work in low-income school districts and teach certain subjects may qualify for complete cancellation of their student loans.

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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 McMaken, 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

Souring Bankruptcy Rates Signal a Calm Before the Storm for the Elderly

Posted on August 20, 2018by Admin

Bankruptcy statistics are showing an alarming trend among senior citizens as more of them are filing for bankruptcy than ever before. In fact, according to the study, these numbers have jumped significantly in the last 25 years.

The numbers come from the Consumer Bankruptcy Project as published by the Social Science Research Network. These figures show that the rate of individuals over the age of 65 who have filed for bankruptcy has grown 204 percent from 1991 to 2016. Further, the percentage that senior citizens who filed compared to all other U.S. bankruptcy filers went up five times over this 25-year period.

It is reported that the rising cost of healthcare, reduced income and decline in pensions are to blame for the increase. All three of these factors have led to the perfect storm, leaving more financially broken retirees than ever before.

Most of these individuals worked their whole lives, thinking Social Security, their pensions and Medicare would carry them through retirement. However, following the 2008 recession, companies began to freeze or completely eliminate pensions. Many also lost their jobs during this time or were forced to retire early and are now delaying collecting Social Security, just barely getting by. All it takes is for one major crisis, whether it be a medical diagnosis or job loss, for their finances to quickly fall apart.

Medical costs seem to be the biggest trigger for financial issues, according to the study. For one, Medicare does not cover all medical expenses that may be needed, including the costs of long-term care, dental treatments or hearing aids. Medicare requires co-pays most of the time, as well as deductibles, and even meeting these costs can be difficult for many. If someone needs major surgery, those costs can be astronomical, even just meeting the deductible.

According to figures from the Kaiser Family foundation, out-of-pocket health expenses for individuals on Medicare took over 40 percent of the average reported Social Security income during 2013. It is anticipated that costs are going to increase to 50 percent of what the average Social Security income is by the year 2030.

The financial institution, Fidelity, reported earlier this year that the average retiree couple, age 65, will need approximately $280,000 alone to cover health care and other medical costs throughout retirement. That figure does not even begin to cover the cost of living. This number is up 75 percent from what Fidelity recommended in 2002, when the company recommended that a retired couple at the age of 65 save up $160,000 for healthcare costs.

One major concern brought up from these statistics is the fact that even though older individuals are struggling, society as a whole does not seem to be all that concerned with their struggles. When the average person is in this type of financial situation, bankruptcy offers him or her a fresh start.

Individuals in this generation can sometimes view bankruptcy as a way of giving up or have trouble asking for help. It is important, however, that if family and friends see their older loved ones struggling financially, that they reach out to them and encourage them to seek help as soon as possible. For many seniors, bankruptcy can provide the relief they so desperately need and help them enter retirement with a fresh financial start.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

How Long Can a Debt Collector Pursue an Old Debt?

Posted on August 10, 2018by Admin

When it comes to debt collections, certain rules do exist as to how long a debt collector can attempt to collect on a debt. These rules apply to the actual lawsuits themselves, as well as credit reporting.

Statute of Limitations

Every state has what is referred to as a statute of limitations, laws which set a limit as to how long an individual has to bring a legal claim on a certain matter. States have limitations on how long a debt collector has to collect on a debt. In Florida, the statute of limitations varies for different types of debts. For written contracts such as personal loans, the statute of limitations is five years. So once this type of debt is more than five years past due, the lender can no longer sue in order to collect owed money.

However, the problem is the debt collectors are not obligated to tell the consumer that they are past the statute of limitations. It is up to the consumer to do the research and know his or her rights if a debt collector is trying to communicate with a them regarding an old debt. There are ways to deal with old debt. Most states have a statute of limitations for debt collections that restricts collections on debts that are four to six years after the date the debtor last made a payment.

One thing to keep in mind, if you think the debt is past the statute of limitations- do not pay on it, until you confirm. A single payment towards an old debt can revive that debt, restarting the statute of limitations.

Indefinite Attempts to Receive Payment

Technically, while there are laws that state how long a debt collector can take legal actions to collect on a debt, there is no law saying they cannot keep trying to contact the individual to pay on the amount. For all purposes, the original creditor can try to get the individual to pay indefinitely, unless the debt has been settled or discharged in bankruptcy.

The law does restrict certain tactics taken by third-party debt collectors who are trying to collect on a past-due debt. The Fair Debt Collections Practices Act (FDCPA) specifically prohibits any communication from third-party collectors that is abusive, harassing or threatening. If a third-party debt collector is continuing to call to the point where the communication is harassing, the individual can send a written letter ordering that debt collector to cease and desist.

Bankruptcy Law, Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

More Older Americans Filing for Bankruptcy

Posted on August 6, 2018by Admin

A greater number of Americans who are 65 years of age and older are filing for bankruptcy. The reasons for this increase in bankruptcy filings are numerous, including the loss of pensions, high medical expenses, and lack of savings. Regardless of the reasons, research is consistently showing that individuals at retirement age of 65 years old or older are three times more likely to file for bankruptcy than this age group in previous years.

One reason for this trend is the instability behind the government safety net that was once there for retirees as they left the work force. Social security was always considered a given, something that would support the retiree throughout their remaining years. Retirees are now having to wait longer to receive their full social security benefits, causing them to struggle to make ends meet until that time.

The pension plans they always considered were a given are now replaced with 401(k) plans, which require self-contribution for them to be successful. Many of these individuals are paying out-of-pocket for medical expenses, and many are being forced into early retirement before they are financially ready to live without a reliable, steady income.

According to Consumer Reports, from February 2013 to November 2016, bankruptcy statistics showed that there were 3.6 bankruptcy filings for every 1,000 individuals between the ages of 65 to 74 years old. This number shows a significant increase from the 1.2 bankruptcy filings for every 1,000 individuals in the same age category in 1991.

Looking at all bankruptcy filings made currently, 12.2 percent of those who filed are older than 65 years old. In 1991, only 2.1 percent of all filings were from individuals older than 65. The problem is the generation following this age group is also filing for bankruptcy in greater numbers. The best explanation for why this is occurring are structural shifts for these generations.

Of the reasons given for why they are filing for personal bankruptcy, these filers are reporting medical debt as a leading cause. The recession of 2008 has also been a leading cause for why these aging filers are facing such difficult financial circumstances. The recession wiped out a great deal of their investments, leaving everyone, including this demographic, leaving them with little money to retire with and a small amount of liquid assets with which to pay medical bills. Lastly, many wives in this generation are outliving their husbands, those in the family who were the main breadwinners and the individuals handling the family finances. Once the husband dies, the surviving spouses may not know how to handle the finances, resulting in decisions that could later lead to bankruptcy court. The notion may seem dated, but in this generation, it is an all-too-common occurrence.

For many, bankruptcy offers a fresh start providing the relief needed from collection proceedings and harassment from debt collectors. But what are the signs that it’s time to file for bankruptcy? Debt collectors can be anything but subtle in their efforts to receive payment on a debt, and this added stress can be too much for an older individual. Filing for bankruptcy puts these efforts to a halt and at the very least gives the individual a chance to breathe and to receive relief from this type of communication. If you are filing for Chapter 7 bankruptcy in Florida, you can use Florida bankruptcy exemptions to protect your property, social security and retirement savings. In addition, residents are provided unlimited exemptions for homestead, annuities, and the cash surrender value of a life insurance policy.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Tax Debt will Affect Passport Renewals and Applications for Thousands of Americans

Posted on August 3, 2018by Admin

Americans who have overdue tax debts will soon find it difficult to receive a new or renewed passport, according to the Internal Revenue Service (IRS). It is estimated that approximately 362,000 Americans have overdue tax debts, and soon, Congress will be increasing efforts to enforce a law passed back in 2015.

The 2015 law requires that the IRS and State Department deny applications for new or renewed passports for taxpayers who have overdue tax debt in the amount of $51,000 or more.

Increased efforts to enforce this law began in February 2018, according to a recent Wall Street Journal report. Currently, the IRS is in the process of sending the names of these 362,000 individuals to the State Department.

According to the IRS Division Commissioner, Mary Beth Murphy, authorities are currently only denying passports rather than revoking them for people who hold excessive IRS debts. In fact, the State Department has stated that the agency has already denied passports for individuals who hold tax debts. For the time being, Americans with over $51,000 in tax debt will be able to continue traveling abroad if they hold current passports.

The IRS has accounted for inflation and other assessed penalties, taxes and interest when calculating the amounts owed. These amounts do not include debts that were collected by the IRS, such as FBAR penalties due to the person’s failure to report foreign financial accounts or child support owed. If the taxpayer has entered into an agreement for installment payments, is in the middle of a bankruptcy proceeding, is a victim of identity theft or is in a federally declared disaster area is not subject to revocation of their passports.

The State Department is within its rights to issue a passport for emergencies or other humanitarian reasons should a U.S. citizen who is subject to this law need to return to the U.S. from overseas. Individuals affected by the law will be notified in writing by the IRS.

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Bankruptcy Law, Credit, Credit Card Debt, Debt Relief

The Dangers of Subprime Credit Cards

Posted on August 1, 2018by Admin

When someone has less than perfect credit and is looking to improve his or her credit score, it can be tempting to look to a subprime credit card. In fact, many consumers looking to start from scratch in rebuilding a low FICO score choose subprime credit cards as their preferred method of rebuilding credit. These credit cards, while they work for some, come with their own set of hidden dangers that should be understood before signing on the dotted line.

A subprime credit card is a credit card issued to individuals who carry a lower, substandard credit score or who have a very limited credit history. Normally, these cards have a higher interest rate than other types of credit cards granted to prime borrowers. In addition to the higher rates, these cards also come with extra fees, as well as lower credit limits.

It is estimated that approximately 40 percent of millennials have what is known as subprime credit, according to credit reporting agency, TransUnion. Of the over 16 million Americans who have credit scores lower than 600 have at least one credit card. Many of them have more than one card, each card holding a significant balance.

Many people are under the misconception that to rebuild credit, an individual needs to get a card and maintain a balance, while paying the minimum payments. When the advertisements pop up on these individual’s computer screens, promising a way to build credit through a subprime credit card, it can be very tempting to click on the ad and sign up right then. However, many of these individuals do not understand what the cons are to sign up for a subprime credit card, and they do not do their homework in researching the negative aspects before signing up for the card.

Hidden credit card fees are oftentimes where people get hit the hardest. Fees can even get as high as being 25 percent of what the available credit balance is on the very first day the card is used. At that rate, it can be nearly impossible for the consumer to catch up.

Subprime credit cards also tend to carry nonrefundable yearly costs. Of the unsecured subprime credit cards surveyed, all nine of them had some type of nonrefundable annual cost. On average, this cost is just a little over $150 on the first year the card is used. The annual percentage rate (APR) for these cards can range as high as 30 percent, which keeps the balance high, no matter how hard the cardholder tries at paying down the balance.

TransUnion reported that the average American who has a low credit score carries 2.5 credit cards. Of these individuals who were surveyed, approximately $300 of their income annually goes towards paying the high credit card fees that went along with those cards, not including the monthly interest that they pay on the balance held on each card.

Occasionally, a subprime credit card will have an annual fee that must be paid from the start. These credit card annual fees will appear on the card statements and can take up 25 percent of the cardholder’s credit line. Ideally, the credit utilization ration will be 10 percent, but for individuals with subprime credit, this number is impracticable.

It is for this reason that many credit advisors recommend that a secured credit card be used by someone just coming out of a bankruptcy or in a bad financial situation to rebuild credit. Unlike a subprime card, a secured card holds lower fees and less risk. Many secured cards offer a graduation program, meaning if the cardholder can establish a good payment history, eventually that person will move up to an unsecured credit card with a good rate. Examples of secured credit card programs include the Capital One Secured Mastercard and the Discover it Secured Card. Secured cards often require the cardholder pay an initial deposit through a connected bank account, or, if someone does not have a bank account, programs exist that allow for a secured card to be issued through an approval process and low annual fee.

It is important that the credit card not carry too high of a balance, and that the cardholder pay the minimum balance every month on time. Only use the card for small, manageable purchases, and keep an eye on the cardholder’s FICO score to monitor any changes in a positive or negative direction.

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