Debt Relief Archives - Page 76 of 86

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

Texas Man Arrested by U.S. Marshals for Unpaid Student Loan

Posted on February 19, 2016by Admin

U.S. Marshals arrested Paul Aker of Texas last week for $1,500 in unpaid federal student loans. Aker borrowed the loan in 1987 and claims that he was unaware he had any outstanding debt.

“I paid two other student loans and thought I had consolidated everything and paid it all off,” Aker said. The U.S. Marshals reportedly made several attempts to serve Aker with a court order requesting that he appear in federal court. The agency said they had searched numerous known addresses before locating Aker. They also said they made contact with Aker by phone in 2012 requesting that he appear in court and he refused.

According to CNNMoney, Aker does not remember having that conversation and said he has not received any notification about the outstanding loan in a long time. A warrant was issued for his arrest soon after he failed to appear in court in 2012.

Two U.S. Marshals went to arrest Aker last Friday at his home. “I went inside to get my gun because I didn’t know who these guys were,” Aker said. The Marshals called for backup after Aker told them he was armed.

After two hours, Aker finally put down the gun and went outside to be arrested without further incident.

Although Aker’s original loan was for $1,500, he now owes approximately $5,700 including interest. He agreed to be placed on a payment plan before a judge last week.

According to CNNMoney, it is common practice for U.S. Marshals to serve summonses to people who fail to appear in court for unpaid federal student loans. However an arrest warrant is only issued after the debtor fails to appear in court.

Arrest warrants were issued for 25 people in the Houston, Texas area for failure to appear in court regarding unpaid student loans.

After 90 days, the loan becomes delinquent and damages the borrower’s credit score. However, student loans are not considered to be in default until nine months of nonpayment.

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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Courts Help Debt Collectors Prey on America’s Working Poor

Posted on February 18, 2016by Admin

Even though the economy is improving, many of America’s working poor, under-employed and unemployed people continue to struggle financially. In addition to their financial troubles, many households face debt collectors who harass and sue them on incomplete or inaccurate information.

To make matters worse for struggling consumers, court judgments often favor debt collectors without determining the validity of the claims. Due to the growth of this problem, it has been the focus in recent research. Both the Human Rights Watch (HRW) and the Alliance for a Just Society recently released reports documenting this disturbing trend.

The report released by the HRW titled “Rubber Stamp Justice,” revealed that courts routinely award default judgments, without the consumer present, in tens of thousands of cases.

The Encore Capital Group, the largest debt collector in the country, has reportedly filed between 245,000 and 470,000 new lawsuits per year in recent years. The report also showed that in 2014 Encore and its competitor, Portfolio Recovery Associates, collected more than $1 billion through debt collection lawsuits.

The report stated, “Fundamental problems with debt collector lawsuits often come to light only after the companies have already won judgments they were never entitled to, in courts that never asked them to present any meaningful evidence in support of their claims.”

Several states have created “judgeless courtrooms” for such cases where consumers are forced to participate in unsupervised discussions with debt buyers and their attorneys. The intention is to provide open forums for compromise, however consumers often end up forfeiting their rights for a future court hearing.

The top consumer debt collection concerns filed with the Consumer Financial Protection Bureau between November 2013 and August 2015 are below:

Demands to pay a debt that affected consumer(s) believes is not owed;
Frequent or repeated calls about the same alleged debt;
Failure to provide documentation to verify the debt.

The Fair Debt Collections Practices Act (FDCPA) originally enacted in 1978 requires that debt collectors provide consumers with certain basic information such as the amount of debt owed and the name of the creditor to whom the debt is owed. A lesser-known requirement of the FDCPA says debt collectors must give consumers a 30-day notice to dispute the debt before it is assumed as valid.

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If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all 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

Americans Borrow No Matter the Economy

Posted on February 16, 2016by Admin

The Federal Reserve recently released data that indicated that American’s borrowing habits are excessive whether the economy is booming or hurting. Over the past decade, credit card debt has gone from $1.02 trillion in 2008, down to $835 billion in 2011 and back up to $935.6 billion by the end of last year.

Americans between the ages of 18 and 65 have an average of $4,717 in credit card debt. The average interest rate is 15 percent, according to creditcards.com. Therefore, if a credit card user makes a minimum payment of $189 per month, it will take more than ten years to pay off a debt of $4,717. Ultimately, the debtor would pay a total amount of $22,869, a cost of $18,155 for a very small loan.

A study released by the Boston Fed examined American credit card debt and found that the biggest reason Americans have such high debt is due to the availability of credit.

The study also showed that only 35 percent of credit card users do not carry a balance. This means they pay off their bill every month and only use their cards for convenience. The other 65 percent of credit card users are “revolvers,” meaning they do not pay their balance in full so the debt revolves. Revolvers tend to see credit limit increases as an invitation to spend more.

Many credit card users are reeled in when companies offer free teaser years that come with as much as $600 worth of miles or hundreds of dollars in cash back as incentives to sign-up and spend. Studies show that credit card debt typically starts in a debtor’s 20’s. Often times the debtor is not earning very much at the time and the availability of funds through credit essentially amounts to extra wealth and reduces the need to save. Although the habit typically starts early in adult life, credit card debt follows most Americans into middle, even old age.

Keep in mind; there are incentives to breaking your credit card habits. According to the Federal Reserve, paying off your credit cards comes with a return that averages 14 percent. This means simply paying off your credit card debt is the best investment you can make.

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

Florida Student Debt Relief Company Files for Chapter 7 Bankruptcy

Posted on February 15, 2016by Admin

A Doral, FL-based student loan debt relief company filed for Chapter 7 bankruptcy this month. The company, Student Aid Center, Inc. estimated between $500,000 and $1 million in assets and 50 to 99 creditors.

Student Aid Center reportedly offered assistance to students dealing with student loan debt. However, a lawsuit filed by the Minnesota Attorney General in July 2015 claimed that the company misled consumers by promising to reduce or eliminate their student loan debt and not producing results.

According to a statement from the Attorney General’s office, the debt relief company promised students that it could immediately qualify them for loan forgiveness with advertisements such as, “Get Your Student Loans Forgiven Now!” and “Say Good-Bye to Student Loan Debt.” The company promoted itself on social media sites and collected upfront fees from borrowers.

After numerous consumer complaints, the company was named in a class action complaint on September 21^st that alleged the company used robo-dialing without obtaining consumer consent.

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Bankruptcy Law, Debt Relief

Is a trust safe in bankruptcy?

Posted on February 12, 2016by Admin

To determine whether or not your trust is safe from creditors in bankruptcy, you will need to know if your trust is a revocable or irrevocable trust. This is important to the bankruptcy court because it reveals who controls the assets of the trust. When you file for bankruptcy, a trustee is assigned to your bankruptcy case to search for your assets. Your assets can include your properties, checking accounts, savings accounts, investment accounts, cars, etc. These types of assets are the more common assets that trustees can take, sell and use the proceeds to pay your creditors.

Revocable trusts are those where the trust beneficiary is waiting to receive something and does not immediately control those assets. In a revocable trust, you or your spouse may be listed as a trustee, however if you are the successor trustee, you have no rights to do anything with the assets until the grantor or creator of the trust passes away.

In a revocable trust, the grantor has complete control over all trust assets prior to their death. The beneficiaries of the trust cannot control or influence what is done with the assets. Once the grantor dies, the trust may now become assets of the beneficiaries. As long as there are no provisions in place, restricting access, the beneficiaries now have a legal claim to the trust. Once the beneficiaries have legal control over the trust, it may not be safe from creditors when filing for bankruptcy.

In an irrevocable trust, terms of the trust cannot be changed or terminated without the permission of the beneficiaries. In this case, the grantor has transferred assets into the trust and effectively withdrawn his or her rights of ownership to those assets. Although beneficiaries might not be able to immediately access the trust, each beneficiary has a legal right to some portion of those assets.

Irrevocable trusts can be more difficult to protect in a bankruptcy proceeding, however there may be some exceptions allowing you to do so. For example, a “spendthrift” provision may limit creditor claims to trust assets even when the trust is irrevocable or the grantor has died.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Bankruptcy Filings Drop to Eight-Year Low

Posted on February 11, 2016by Admin

The Administrative Office of the U.S. Courts (AOUSC) released statistics showing a 9.9 percent drop in bankruptcy filings in 2015. During the 12-month period, January through December, 844,495 cases were filed in federal bankruptcy courts. This is down from 936,795 bankruptcy cases filed in 2014.

This is the lowest number of bankruptcy filings within a 12-month period since 2007. Last year was the fifth consecutive year that bankruptcy filings have fallen.

Business and non-business bankruptcy filings dropped in 2015. The total business bankruptcy filings were down from 26,983 in 2014 to 24,735 in 2015. The total non-business bankruptcy filings were 819,760, down from 909,812 the previous year.

Both Chapter 7 and Chapter 13 filings dropped in 2015. Chapter 7 filings are the proceedings in which a debtor’s nonexempt assets are liquidated and the proceeds are distributed to creditors. Chapter 13 filings allow individuals to receive regular income to obtain debt relief while retaining their property by proposing a plan that uses future income to repay a portion of their debts over a three to five year period.

Chapter 11 and Chapter 12 filings both increased slightly from 2014. Chapter 11 filings are for businesses or individuals whose debts exceed the statutory thresholds for Chapter 13. Chapter 12 filings are for family farmers or fisherman.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Credit Card Debt on the Rise

Posted on February 10, 2016by Admin

While the economy indicated signs of financial hardship in November 2015 with low spending, consumers were spending more confidently in December and January with credit card debt increasing at its fastest pace in more than seven years. Outstanding consumer credit, which includes all credit outside of mortgages, increased by an annualized $21.27 billion in December. Economists had only predicted consumer credit would rise $16.5 billion.

Revolving credit, which is mostly credit card debt, rose by $5.84 billion after rising $6.36 billion in November. Since last year, revolving credit rose 5.1 percent. This is the fastest gain since October 2008.

So where were consumers using their credit cards in the fourth quarter? Amazon.com accounted for a vast majority of credit card use, bringing in 51 percent of the total retail sales growth in the fourth quarter. The online retail giant also accounted for 42 percent of total retail sales growth for the entire year. However, companies such as Apple iPhone indicated sales were flat worldwide in December. Apple also forecasted its first yearly decline in sales in 13 years.

Non-revolving credit, including auto and student loans, increased $15.43 billion, up from $7.66 billion in November. However, economists anticipate auto sales will plateau or fall in 2016 from fourth quarter levels.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Does Florida Law Protect Inherited IRA’s?

Posted on February 8, 2016by Admin

In 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act was enacted to protect Individual Retirement Accounts or IRA’s from being seized by bankruptcy courts. Most states’ bankruptcy courts allowed inherited IRA’s to be protected from seizure as well, until a 2014 ruling by the Supreme Court.

The 2014 case of Clark v. Rameker set a precedent when the Supreme Court ruled that federal law does not protect inherited IRA’s because the holder of the IRA cannot invest new money into the account; can withdraw the entire balance at any time and use the funds for any reason without penalty; and must take required distributions from the account no matter how far the holder is from retirement.

In addition, the ruling also means that inherited 401(k)s are not protected in bankruptcy court. IRA’s have a $1.2 million cap on the protected amount, however 401(k)s do not have a limit on account balances that are protected.

There are some circumstances where inherited IRA’s may be protected to an extent. Each state is allowed to establish individual exemptions. Florida is one of seven states where all IRA’s are considered a bankruptcy exemption. Under Florida Statute 222.21, IRAs and Roth IRAs are completely protected by debtors in bankruptcy court. Another exception in most states is if a living spouse is the beneficiary of the IRA, they are allowed to treat it as their own in bankruptcy court and it is therefore, exempt.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

12 Times You Can Sue a Debt Collector

Posted on February 4, 2016by Admin

Millions of Americans struggle with debt and in turn have to deal with collection calls. While some debt collectors abide by the legal debt collection practices, many do not. Fortunately, there are protections in place that allow consumers to fight back if debt collectors violate their rights. A strong federal law, called the Fair Debt Collection Practices Act (FDCPA) protects consumers against unfair collection practices and helps prevent creditor abuse and harassment.

Below are 12 times when you can sue a debt collector.

Calling early & calling late. Debt collectors should not be calling you before 8:00 a.m. or after 9:00 p.m. It is a violation of the Fair Debt Collection Practices Act (FDCPA) for a collector to call at a time that is known to be inconvenient. This is typically a time you are away from work, at home with your family or sleeping.
Calling at other Inconvenient Times. If you have told a collector not to call at a certain time, that is also a violation of the FDCPA. If you work nights and tell the debt collector not to call you during particular hours, they cannot do so.
Discussing with Third Parties. Debt collectors cannot call a family member and say that you owe them money. This is another violation of the FDCPA. They can call and ask how to reach you, but they cannot discuss your debts with anyone besides you. The only exception is that debt collectors can contact your spouse.
When a Lawyer’s Involved. If a debt collector knows you have hired an attorney and they contact you that is a violation of the FDCPA. The reason is that the consumer may be in the process of filing for bankruptcy.
Making False Threats. If collectors make threats and do not follow through, that is a violation of the FDCPA. This can include both legal threats such as a lawsuit, or any other type of threats.
Calling the Wrong Party. If a collector has the wrong number and continues to call you after you have told them who you are, that is grounds for a lawsuit. The collector may think that you are lying about your identity, so they keep calling, thinking that you will come clean.
Using Pre-recorded or automated voice calls. “Robocalls” are an illegal form of debt collecting. The Telephone Consumer Protection Act (TCPA) prohibits any company to use automated or pre-recorded calls to collect debts.
Using Automatic Phone Dialing Systems. Telephone systems that automatically dial numbers one after another and can contact consumers up to five times per day are illegal under the TCPA.
Misrepresenting the Nature of the Debt. Oftentimes, debt collectors pressure family members of deceased relatives to pay their debts by saying they are responsible, even if they are not. This is illegal and has severe penalties.
Threatening Violence. Under no circumstances is a debt collector permitted to threaten violence to coerce consumers to pay their debts.
Using Profanity. The FDCPA protects debtors from verbal abuse such as the use of obscene or profane language. If it is meant to cause harm, it is grounds for a lawsuit.
False Representation. If a collector does not disclose who they are or why they are calling, that is a violation of the FDCPA. Collectors must disclose to the consumer who they are and that they are attempting to collect a debt either in writing or over the phone.

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Credit, Debt Relief, Foreclosures, Timothy Kingcade Posts

Active Foreclosure Backlog is Clearing Out

Posted on February 3, 2016by Admin

The rate of foreclosures was down in 2015 compared to the previous five years. As a result, foreclosure inventory was down to its pre-recession level, meaning the backlog of foreclosures in the court systems are continuing to clear out at a substantial rate.

Nearly half the residential mortgage loans that were in foreclosure at the beginning of 2015 were either liquidated or returned to current status by the end of the year. Active foreclosures at the end of the year were less than a third of what it was during the peak of the housing market crisis, five years ago, according to a report released by the Black Knight Financial Services.

Approximately 880,000 residential mortgage loans were in active foreclosure at the beginning of 2015. Out of those, 484,000 were at least two years delinquent. By the end of the year, 47 percent of the total number of loans in active foreclosure had either returned to performing status or were liquidated. This is 1.5 percent higher than the previous year.

Active foreclosure inventory went from 880,000 at the beginning of the year to 689,000 at the end of the year. This is the first time the foreclosure rate has ended the year below 700,000 since 2006.

However, consumers are not out of the woods just yet. The remaining foreclosure volume was still two and a half times the “normal” level at the end of 2015, even with the declines.

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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.