Debt Relief Archives - Page 81 of 86

New Bankruptcy Forms Effective December 1, 2015

Posted on November 18, 2015by Admin

The majority of the bankruptcy forms are being replaced effective December 1, 2015. This change is in an effort to improve the official bankruptcy forms and the interface between these forms and available technology. In creating the new forms, surveys were conducted to determine the problems with the current forms and input was utilized at the design phase from practitioners, trustees, along with software vendors.

It’s important that bankruptcy attorneys do not assume these are the same forms as the old ones. Read the questions and instructions thoroughly. Make sure and get your clients to disclose all of their assets and claims, including the contingent ones.

One of the key features of the new forms is that there is a separate case-opening form for individuals, new Form B101, Voluntary Petition for Individuals Filing for Bankruptcy, and a new form for non-individual debtors, new Form B201, Voluntary Petition for Non-Individuals Filing for Bankruptcy.

The new form for individual debtors would also be used for married debtors. Only business entities would use the non-individual form. The non-individual debtor’s form reflects how businesses keep financial records. The new forms also remove questions relevant only to individuals.

There’s been concern that because these forms are reportedly easier to use, it will encourage more pro se filings. There are warnings throughout the new forms against pro se filings, but these are always a reality.

Click here to read more on this story.

If you are in financial crisis and considering filing for bankruptcy, 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

Three Times Bankruptcy is the Right Decision

Posted on November 17, 2015by Admin

Bankruptcy can have significant consequences to your credit score, but sometimes the hit can be worth it if it means getting out from under a mountain of debt and gaining a fresh financial start. Filing for bankruptcy should not be taken lightly, but if paying down the debt would leave you with no money to put food on the table and pay the mortgage, filing for bankruptcy makes sense.

Here are some additional circumstances when it makes sense to file for bankruptcy.

Your liabilities are more than your assets. Bankruptcy is often the best option when debtors owe so much that their liabilities far outweigh the value of their assets. In such cases, it’s often impossible to ever get caught up.

Negotiations didn’t work. Before filing for bankruptcy, it’s a good idea to try and negotiate with your creditors. There is a possibility they will settle the debt for less money than you owe if you can prove that you are struggling financially. But if your creditors are unwilling to negotiate with you, the only other option may be to file for bankruptcy protection.

A job loss, medical emergency or other financial disaster has eliminated your ability to generate monthly income. Medical bills are the number one cause of U.S. bankruptcy filings. Even having health insurance does not shield consumers from overwhelming medical debt. Bills and debt can pile up quickly without the monthly income, leaving consumers with no way out.

Related Resources:

http://www.csmonitor.com/Business/Saving-Money/2015/1116/Three-times-bankruptcy-is-the-right-decision

Debt Relief, Foreclosures, Timothy Kingcade Posts

$5 Million Foreclosure Fraud Verdict puts National Mortgage Settlement into Question

Posted on November 16, 2015by Admin

A Texas jury’s recent decision to award more than $5 million in damages and fees for the fraudulent foreclosure of a single home has put the $25 billion national mortgage settlement into question.

This month, a jury in Houston awarded $5.38 million to a couple on the grounds that Wells Fargo Bank and Carrington Mortgage Services knowingly submitted false documents to force them out of their home. The financial compensation for the homeowners is as follows: $150,000 in financial injuries, $40,000 for mental anguish, $5 million in punitive damages and $190,000 in attorney’s fees.

There have been approximately 6 million foreclosures since the start of the foreclosure crisis in 2008 and many of them were completed with robo-signed, fabricated or fraudulent documents. If we apply the $5.38 million jury award to all of those loans, the potential cost from the foreclosure fraud scandal is closer to $32.28 trillion!

This estimate represents the extreme edge of the financial hit to the industry. But while the settlement did not preclude individual civil suits like this one, it’s obvious that most victims of foreclosure do not have the financial means to go back and forth in court like this family did.

That is where law enforcement must step in and protect the rights of foreclosure victims lacking these type resources. Looking at this verdict, the $25 billion National Mortgage Settlement has been anything but generous as it represents roughly 0.08 percent of the total possible exposure.

Click here to read more on this story.

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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Five Things to do after Bankruptcy

Posted on November 12, 2015by Admin

So you recently filed for bankruptcy and received your discharge, what should you do next? Whether you filed for Chapter 7 (a simple and straightforward elimination of debt bankruptcy) or a Chapter 13 (a debt repayment bankruptcy), there are certain things you should do once your case is finalized.

Collect and preserve all paperwork from your case. You should have received a full copy of your bankruptcy petition from your attorney, which is 40-50 pages of detailed financial information – including the facts about the debts and assets involved in your case. You should have also received a notice of bankruptcy filing directly from the court, which shows the deadlines that affected your case. The court should have also sent you a copy of your discharge order entered by the bankruptcy judge. It is important to have these because some lenders want to see a copy of the bankruptcy papers when considering you for new credit. This is especially true for mortgage loans.

Monitor your credit reports regularly. Credit reports from the three major credit reporting agencies can be obtained for free once a year- and it’s important to know what your creditors are saying about you. Wait approximately three to six months after your bankruptcy has been discharged to do so. It may take several billing periods for creditors to update their accounts, and many creditors and lenders will stop reporting to the credit bureaus altogether after a bankruptcy. It is important to do this because you want to make sure all of your discharged debts from the bankruptcy are being reported to the credit bureaus with a zero balance, so it does not count against you as outstanding debt, which can hurt you if you are applying for new credit.

Start a budget and review it regularly. A main focus after bankruptcy is rebuilding your credit and your budget. Create a basic budget to understand your expenses and take some time every week to see where you are at. Remember the Means Test from your bankruptcy paperwork that compared your income and expenses over a six-month period to standards set by the Census Bureau and the IRS. This test was meant to ‘filter out’ those who had the means to pay their debts, but who were living an extravagant lifestyle financed on credit cards. This is often considered an urban myth, as statistics reveal that a very small percentage fit into “the extravagant lifestyle” category. Most bankruptcies are the result of unforeseen medical expenses, a job loss, divorce or birth of a child.

Start an emergency fund. This goes hand in hand with putting together a realistic budget. When creating your budget, a small part of your income should be set aside for the unexpected. You can begin saving for an emergency fund in less than one month. If you do this every month, you will be amazed at how much it grows. You can start putting a portion of it aside for retirement or your child’s college fund. This is important to do because it will prevent you from obtaining new debt and repeating the cycle.

Consider new credit. Don’t let yourself get carried away with this one. Start with a small credit limit; monitor your charges and budget so you can pay the balance in full each month. There is a world of difference between having good credit and a heavy debt load.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

What’s Considered Bankruptcy Fraud? The Supreme Court will decide in New Case

Posted on November 11, 2015by Admin

Bankruptcy relief is not available to those who defraud their creditors, but what is the definition of fraud? The Supreme Court is getting ready to decide this in a new case. Bankruptcy laws require debtors pay back the money they owe if it was obtained by “false pretenses,” “false representation” or “actual fraud.”

Two circuits have broadly interpreted “actual fraud” as when a debtor obtains money through a scheme that is intended to cheat creditors. However, another appellate court, ruled that it is not “actual fraud” unless a debtor actually lies to the creditor. As a result, the Supreme Court will have to decide between the narrow and broad definitions of “actual fraud” to determine when certain debts will be discharged or must be dealt with in bankruptcy.

The case involves business owner Daniel Lee Ritz Jr., whose company, Chrysalis Manufacturing Corp., purchased $164,000 worth of goods from Husky International Electronics Inc. between 2003 and 2007. During the four-year period, Chrysalis never paid for the goods, and Ritz funneled more than $1 million of Chrysalis’s funds to other companies under his control.

Husky later sued Ritz to hold him personally liable for Chrysalis’s debt, but before a judge could rule on the suit, Ritz filed for Chapter 7 bankruptcy protection. Husky countered and sued Ritz in bankruptcy court, arguing that he should pay the debt because he defrauded Husky by moving Chrysalis’s funds out of its reach. A bankruptcy court found in 2011 that although Chrysalis did not benefit from the transfer of its funds, and although Ritz was not a “credible witness,” his conduct did not meet the definition of “actual fraud” for one reason: He did not lie to Husky.

A lack of misrepresentation from Ritz to Husky is what also caused a district court and appellate court to each conclude that there was no “actual fraud” and therefore Ritz could be set free from the debt he owed Husky. Husky has requested the Supreme Court take the case, which they agreed to last week.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Bankruptcy Filers Targeted by Scammers

Posted on November 10, 2015by Admin

Bankruptcy Filers Beware: Telephone Scam Soliciting Wire Transfers

The National Association of Consumer Bankruptcy Attorneys (NACBA) is warning its members to remain in contact with current and past clients regarding “scammers” posing as bankruptcy attorneys. The elaborate scam targets people who have filed for bankruptcy and those who are just starting the process. The scammers use software that “spoofs” the caller ID system to appear that it is coming from the phone line of a consumer bankruptcy attorney.

Victims of the scam are being instructed to wire funds to satisfy a debt, supposedly outside of the bankruptcy proceeding. Some consumers have even been threatened with arrest if they do not wire the money. These calls come in after business hours, making it hard for consumers to verify their authenticity. In addition, to make themselves sound even more legitimate, these scammers are pulling consumers’ personal information from public records.

NACBA has been in contact with the courts and media regarding this complex scam. Warnings have been issued by the Office of the Attorney General in New Hampshire and by Virginia Eastern District bankruptcy clerk William C. Redden. However, despite these warnings, incidents continue to be reported- one coming from a client of ours last week!

It is important for consumers to know that under no circumstances would a bankruptcy attorney or staff member ask a client for an immediate wire transfer to satisfy a debt nor would they threaten arrest if the debt is not paid.

Members of the NACBA Legislative Committee will soon approach the Department of Justice to not only request a more thorough investigation into how consumer information is being compromised but also recommend steps that can be taken to further protect the identity of those going through the bankruptcy process.

You can click here to learn more about the consumer bulletin sent out by NACBA.

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

Student Loan Debt Crisis: Worse than we thought

Posted on November 6, 2015by Admin

After a series of hearings held 25 years ago on abuses in the higher education system, Congress created laws to protect undergraduates from risky student loans. The original investigation was held in the early 1990’s and revealed widespread fraud among for-profit colleges. Some trade schools had reportedly gone so far as to recruit people from welfare lines to sign up for student loans without their consent. In the end, the loans were never repaid and the colleges kept the money.

In response, Congress created a rule called the cohort default rate, which requires the Dept. of Education to calculate the percentage of borrowers who have recently left a given college and defaulted on their federal student loans. If the default rate is too high, the college is kicked out of the federal financial aid system.

However, two weeks ago the Education Department released new data suggesting the system has failed borrowers, and at some colleges, students are still being strapped with loans they will never be able to repay.

The loan crisis hits hardest at colleges enrolling large numbers of students from low-income backgrounds. These students oftentimes have to borrow all of the expenses needed to attend college and have trouble securing a job upon graduation- if they even graduate. The colleges reported to have the lowest student loan repayment rates include many for-profit colleges and a number of historically black colleges.

Research has found that student loan defaults are heavily concentrated among the “most economically marginalized students;” the new data suggests that debt is a major financial obstacle for people who already face barriers to opportunity. In light of the new data, hopefully Congress will revisit its system for ensuring that students who take on debt have a chance of actually paying it back.

Click here to read more on this story.

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

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

A WIN for Consumers! FTC Announces Major Enforcement Action against Debt Collectors

Posted on November 5, 2015by Admin

The Federal Trade Commission and other law enforcement authorities around the country have announced the first coordinated federal-state enforcement initiative targeting deceptive and abusive debt collection practices. This nationwide crackdown encompasses 30 new law enforcement actions by federal, state and local law enforcement authorities against debt collectors who use illegal tactics. These tactics include, but are not limited to: harassing phone calls, phony impersonations, false threats of litigation, wage garnishment – even arrest.

It has been documented that collectors even tried to collect on so-called phantom debts – phony debts that consumers do not actually owe. The illegal practices also included the failure to give consumers legally required disclosures and notices, or to follow state and local licensing requirements.

“Being in debt is stressful enough for many Americans without also being subjected to intimidation and false threats,” FTC Chairwoman Edith Ramirez said. “Debtors have certain rights and rogue collectors that step outside the law will face the consequences of illegal behavior.”

According to the complaint, the defendants also failed to identify themselves to consumers as debt collectors, falsely portrayed themselves as process servers or attorneys, and falsely threatened arrest or litigation. The defendants unlawfully disclosed consumers’ debts to third parties in an attempt to embarrass the consumers into paying them. All of these are in violation of the Fair Debt Collection Practices Act (FDCPA), which was designed to help prevent creditor abuse and harassment.

Click here to read more on this story.

Bankruptcy Law, Debt Relief, Student Loans

How the Government Polices what Student Debtors Spend

Posted on November 4, 2015by Admin

A social worker at Sacramento County’s department of children’s protective services who filed for bankruptcy, asked the court to forgive the $137,000 she owed in student loans because paying them, she said, would make it impossible to provide for her five family members, which include her elderly mother, disabled husband, and three children.

According to lawyers for the Department of Education, her $700-per-month food budget was too high and “she cannot purposely choose to live a lifestyle that prevents her from repaying her student loans.”

The government’s scrutiny of her cash flow is not surprising. For more than a decade, the Education Department has closely examined debtors’ basic expenses in its fight to prevent student borrowers from discharging their student loans in bankruptcy- often disqualifying those who need it the most.

In some bankruptcy proceedings, courts will consider how much someone is spending, to determine how much they can reasonably pay back to their creditors in the future. However, when it comes to student loan debt, the government has additional leverage. The Education Department can deny people bankruptcy altogether if its lawyers can show that debtors are spending too much on basic items like fast food, cable television, or even their pension plans.

Government lawyers are given license to do such meticulous accounting because of a provision in the bankruptcy code. Congress passed rules in the 1970s making it nearly impossible to get rid of student loan debt in bankruptcy unless they can prove “undue hardship,” without defining the term. Instead, it is left to the courts to interpret the law. Most courts require debtors prove they cannot maintain a “minimal” standard of living while paying the debt back. Lawyers for the Education Department generally view any sign of excessive spending as an argument that debtors don’t qualify.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Can you spot the signs of a Debt-Relief Scam?

Posted on November 3, 2015by Admin

When bills begin to pile up and collection calls start coming in, people can become so desperate to get out of debt they will believe anything. Some turn to ‘quick-fix’ debt relief companies that promise to solve their financial problems. But for many, not only does the relief never come but it puts them even more in debt- sometimes out thousands of dollars.

The Federal Trade Commission announced a $7.9 million settlement with DebtPro 123, a debt-relief agency that scammed people by making false promises. Here is the anatomy of how the scam worked:

Promotion: DebtPro 123 is not alone. Look for company names intended to lure vulnerable debtors. These agencies will make you think they feel your pain and promise to eliminate your debt easily in just a couple of years.

Pitch: According to the FTC’s complaint, DebtPro 123 told consumers that its “debt resolution program would completely resolve consumers’ credit card and other unsecured debts (including department store accounts, personal loans, medical bills, student loans, and accounts with collection agencies).”

It also boasted: “DebtPro will reduce a client’s total debt by 70 to 80 percent on average including all fees” and “With settlements as low as 10 percent, this means when all is said and done, a client’s savings could be as much as 20 cents on the dollar including our fees.”

Remember the old adage- When it sounds too good to be true, it usually is.

Two-phased program: In the first phase, customers put money in a “Creditor Fund/Settlement Account.” They were told they needed this money for negotiations with their creditors. In phase two, customers were promised that the company was working on their case to settle with creditors and get rid of their debt.

During this time, customers were advised to stop paying their bills and to cease all communication with their creditors. Consumers later found out that nothing had been done on their case. Instead, interest, penalties and fees began to pile up.

Strategy: The real plan was to make money off desperate people. “For many consumers, more than half of their monthly payment went towards defendants’ fees,” said the FTC. “For consumers who were in the program longer than 18 months, defendants also charged a $49 monthly ‘maintenance fee.’ ”

More failed promises: Debts were not reduced quickly. In fact, many times, the debt-relief company did not start settlement negotiations until after the client had received letters from creditors warning of an impending lawsuit for failure to make debt payments.

In the end, people ended up more in debt, some lost their homes, and others had their wages garnished.

Click here to read more on this story.