Kingcade Garcia McMaken, P.A. Bankruptcy Attorneys

Credit, Foreclosures, Timothy Kingcade Posts

FHA Gives Foreclosed Borrowers a Second Chance at Homeownership

Posted on September 5, 2013by Admin

The Federal Housing Administration (FHA) is offering a homeownership program that will put previously troubled borrowers on the fast track to owning a home, again. This new program, called “Back to Work-Extenuating Circumstance,” shortens the standard three-year waiting period to 12 months. As part of the FHA’s ongoing mission, the new program aims to make sure that qualified borrowers are not being unnecessarily shut out of the housing market.

This is good news for borrowers who lost their home because of specific financial hardships, but can now demonstrate that they have regained their financial footing.

Individuals that have been through any of the below financial hardships are eligible for the program:

• Chapter 7 or Chapter 13 bankruptcy
• Deed-in-lieu
• Forbearance
• Foreclosure
• Loan modification
• Loss of income, employment or both that totaled at least 20 percent of previous earnings for at least six months, including copies of applicable termination notices or changes in employment status.
• Pre-foreclosure sales
• Short sales

Borrowers must also meet other verifiable requirements to participate in the program. These include:
• Proof of borrower’s current income. This can be verified with W-2 forms or federal tax returns that show the desired mortgage would be affordable and sustainable.
• Credit history, both before and after the financial hardship event. This information must be free from late payments or other major credit issues, including rental / housing payments and accounts delinquent by 30 days or more.
• A credit score of at least 500.
• Housing counseling by a HUD-approved counselor at least 30 days but no more than six months before
submitting an FHA application.

For consumers meeting all of these criteria as well as other FHA mortgage guidelines, the “Back to Work program” is now available nationwide through FHA-approved lenders. Once participating lenders determine that mortgage applicants meet all eligibility and policy criteria, the same 3.5 percent minimum FHA down payment requirement will apply. Mortgage insurance and closing costs will also apply. The only FHA program that is ineligible for the “Back to Work program” are reverse mortgages.

Click here to read more on the new FHA program that gives foreclosed borrowers a second chance at homeownership.

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, Timothy Kingcade Posts

Steps You Can Take in Preparation for Bankruptcy

Posted on September 4, 2013by Admin

So you have considered all your options, examined your finances and have come to the conclusion that bankruptcy is the right option for you. It is important to remember that filing for bankruptcy is a process, not an event. What you do before, during and after the filing will affect your future. RELAX… You are on the path to a financial fresh start!

Below are some steps you can take in preparation of bankruptcy:

1. Consult with an experienced bankruptcy attorney. The first thing you should do once you decide to file bankruptcy is to talk to an experienced bankruptcy attorney. The initial consultation is often free, so you have nothing to lose. The fact that it is possible to file bankruptcy pro se (without a lawyer), does not mean you should do it. Doing your own bankruptcy can be difficult, risky and emotionally draining. Your lawyer will negotiate on your behalf with the bankruptcy court trustees and contact your creditors to put an end to those harassing calls.

2. Stop Borrowing Money and Using Credit Cards. Once you have decided to file for bankruptcy, you should immediately stop borrowing money and using your credit cards. Racking up exorbitant amounts of debt prior to filing bankruptcy is considered fraud and can land you in jail. This includes borrowing money from family and friends. When you file for bankruptcy, you must include as creditors any family members or friends who loaned you money.

3. Stop Paying your Bills. Well, some of them. You will want to stop paying on any unsecured debts or loans. For example, making credit card payments. Do not do any of the following unless your attorney advises you otherwise:
• Do not repay friends or family members who made unsecured loans to you.
• Do not pay any single unsecured creditor a total of $600.00 or more within the three months prior to filing bankruptcy.
• Do not transfer any property, assets, cash or anything else of value to anyone else in an attempt to get these out of your name.

4. Learn How to Live Poor. You must learn to economize. You will be required to live on a cash basis for a short amount of time. Live within your means and take this second chance at a new financial life seriously.

5. Reclaim your Phone. From the time you stop paying your bills until you retain an attorney to help you file for bankruptcy, bill collectors are likely going to have your cell phone number and will be calling you obsessively trying to collect unpaid debts. In the mean time, it may be a good idea for you to buy a prepaid cell phone with a new number. But it is important to remember to NEVER use this new phone to call a bank, credit union, utility company or bill collector. If you do this, your new number will be captured and within days uploaded to the credit bureau allowing every bill collector to have access to it, again.

6. Tell Someone. Surround yourself with positive people following your decision to file bankruptcy. You should not feel depressed, ashamed or alone. This person can be a family member, counselor or friend.

7. Start Planning your Recovery. Discuss the following financial recovery goals with your attorney or bankruptcy counselor:
• Opening a savings account immediately upon discharge and accumulating a certain amount within six months after your bankruptcy is discharged.
• Getting a secured credit card within a month after discharge.
• Having enough cash to pay for a 20 percent down payment on a new car within one year of discharge.

Click here to read more on steps you can take in preparation for bankruptcy.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Foreclosures, Timothy Kingcade Posts

Jacksonville Leads U.S. in Foreclosures

Posted on September 3, 2013by Admin

According to the Florida Legislatures Office of Economic and Demographic Research, Jacksonville led the United States in foreclosures last month. The data also reflected that Florida had the highest number of foreclosure filings nationwide. Among the highest U.S. metro area rates, nine of the top 10 were in Florida, led by Jacksonville, followed by Miami-Fort Lauderdale, Port St. Lucie, Ocala and Palm Bay-Melbourne.

According to data from RealtyTrac, Florida posted the nation’s highest state foreclosure rate for the third consecutive month in July, with one in every 328 housing units with a foreclosure filing during the month. This number is more than three times the national average!

Florida foreclosure activity continues to increase. According to the data, 16 of the last 19 months foreclosure activity has increased on an annual basis in Florida. Scheduled foreclosure auctions increased 74 percent from a year ago and bank repossessions increased 13 percent from a year ago.

Click here to read more on the recent report showing the city of Jacksonville leading the U.S. in foreclosures.

Credit, Foreclosures, Timothy Kingcade Posts

TREND ALERT: 69% of Home Sales Are Cash in S. Florida

Posted on September 2, 2013by Admin

According to a recent article in the Sun-Sentinel, 69 percent of all South Florida home sales last month were cash deals. Across the state, 66 percent of home sales were cash, compared with the national rate of 40 percent- which many housing experts are calling “astounding.” With one of the nation’s highest foreclosure rates, South Florida has a large supply of bank-owned properties.

Lenders have become less interested in waiting for traditional buyers to qualify for mortgages, and instead, have opted to sell to investors who are willing to pay cash for properties. This in turn, has shut out many entry-level homebuyers.

So who are these cash buyers? Much of the cash buying in South Florida is from foreigners who view condominiums as safe investments. In the past year, large funds have entered the region, buying single-family homes and renting them out for a year or longer.

Among Florida’s metropolitan areas, the South Florida metro area — covering Palm Beach, Broward and Miami-Dade counties — was second only to Brevard for cash deals. One factor in cash buyers’ favor has been the tightening of mortgage requirements following the easy-lending standards that proceeded the 2007-09 recession.

Click here to read more on the increasing number of cash sales for homes in South Florida.

Credit, Foreclosures, Timothy Kingcade Posts

Government Relaxes Mortgage Down Payment Standards

Posted on August 30, 2013by Admin

This week, Federal regulators proposed a new rule that would make mortgage lending standards less restrictive. The proposed Qualified Residential Mortgage rule was supported by both consumer advocates and mortgage industry members- an otherwise rare occurrence- largely because it eliminates much stricter down payment rules that the previous version of QRM would have created.

The Consumer Financial Protection Bureau’s Qualified Mortgage (QM) rule requires lenders to underwrite home loans based on the borrower’s ability to repay the loan, a step the agency took to combat some of the bad lending practices that led to the housing crisis.

Under the CFPB’s QM rule, borrowers must provide income documentation that they can repay the loan, and that their debt-to-income ratio does not exceed 43 percent, among other requirements. It does not, however, have any rules requiring lenders to ask for a set down payment amount.

QRM would have required lenders to demand a 20 percent down payment from borrowers. The rule was intended to prevent unqualified borrowers from taking out a mortgage they can’t handle, but housing advocates and mortgage industry members argued that it instead prevented too many qualified and responsible low- to middle-income borrowers from taking out a mortgage.

According to some housing experts, aligning the QRM rule with the QM rules will allow more American families to become homeowners and ensures that housing markets can remain strong in the future. This is especially important for communities that are still rebuilding from the foreclosure crisis.

The National Association of Realtors President Gary Thomas called it a “a victory for homebuyers and the future of homeownership in this country.”

Click here to read more the new rule that would make mortgage lending standards less restrictive.

Bankruptcy Law, Credit, Timothy Kingcade Posts

A Roadmap out of Bankruptcy

Posted on August 29, 2013by Admin

People who file for bankruptcy can sometimes feel ashamed, hopeless and overwhelmed. But it may be a comfort to know that you are not alone. According to the American Bankruptcy Institute, the number of July bankruptcy filings came to 87,684.

Below are eight tips on how to recover after filing for bankruptcy:

1.) Address what caused the bankruptcy. This will help you avoid ending up in the same predicament five years later. Set a new budget and look for different employment opportunities.

2.) Identify your goals. These can include paying off old debts or rebuilding your credit score. Whatever these may be, it’s important to write down these goals and work towards them.

3.) Check your credit score. Inaccurate information on credit reports is becoming more common and can affect everything from qualifying for the best mortgage rates to getting hired for that dream job you recently applied for. Simply removing incorrect information from your credit report can oftentimes improve your score.

4.) Gradually re-establish credit. Taking out two credit cards and paying them off monthly can help rebuild your credit score. After seven to 10 years of doing this, your score could look as good as new!

5.) Find a new credit card issuer. While lenders are sometimes hesitant to give credit to people that have recently filed for bankruptcy, there are some that are willing. The terms may not be ideal at first, but these new accounts will help rebuild your credit over time.

6.) Avoid unfair deals. Predatory lenders oftentimes target the most vulnerable groups, including recent bankruptcy filers. You should be weary of payday loans and rent-to-own deals that carry high interest rates.

7.) Seek support. Surround yourself with positive people following your bankruptcy. Online communities of people going through the same thing can offer much needed support.

8.) Think positively. Most people’s credit improves after filing for bankruptcy. Many of the clients I help, their only regret is that they didn’t file sooner. While bankruptcy will stay on your credit report for up to 10 years, many creditors are more than willing to lend you credit after you have filed for bankruptcy.

Click here to read more on a roadmap out of bankruptcy and into recovery.

Bankruptcy Law, Foreclosures, Timothy Kingcade Posts

FHA Shortens Waiting Period for Borrowers Who Experienced Foreclosure or Bankruptcy

Posted on August 28, 2013by Admin

The Federal Housing Administration (FHA) is allowing borrowers who went through a bankruptcy, foreclosure, deed-in-lieu or short sale to reenter the market in as little as 12 months. Previously, borrowers who experienced a foreclosure had to wait at least three years before getting a chance to be approved for an FHA loan. To qualify for the more lenient approval process, documents must show ‘certain credit impairments’ were from loss of employment or loss of income that was beyond the borrower’s control. The lender must also verify the income loss was at least 20 percent for a period lasting for at least six months.

Additionally, borrowers must demonstrate they have fully recovered from the event that caused the hardship and complete housing counseling. Housing counseling must come from a HUD-approved housing counseling agency and be completed at least 30 days but no more than 6 months before applying for a loan. Recovery from an economic event involves reestablishing ‘satisfactory credit’ for at least 12 months. The criterion for ‘satisfactory credit’ includes 12 months of good payment history on either a mortgage, rent or credit card account.

This more lenient approval process applies to case numbers assigned on or after August 15, 2013 and is effective through September 30, 2016.

Click here to read more on the FHA’s more lenient approval process allowing borrowers to reenter the housing market in as little as 12 months.

Bankruptcy Law, Timothy Kingcade Posts

How Bankruptcy Could Help Solve the Student Loan Debt Crisis

Posted on August 27, 2013by Admin

Last week, President Obama introduced a proposal that would give colleges federal money based on performance and affordability to students. This so called ‘ratings system,’ Obama said would require accountability at colleges across the country in an effort to curb the escalating costs of student loans.

However, experts say there may be another more effective way to solve the student loan debt crisis: bankruptcy law. Under the current system, student loans are near impossible to get discharged through bankruptcy, unlike most other forms of unsecured debt, such as medical bills and credit card debt. Legal experts say this is creating a generation of Americans who are unable to get out from under the crushing weight of college debt and falling off the economic grid.

The Consumer Financial Protection Bureau found that total student loan debt is approaching $1.2 trillion, which would exceed credit card debt by more than 28 percent. According to a recent study done by the Center for American Progress, forty-five percent of all American families now have student loans.

With unemployment high among recent college grads, default rates on these student loans have risen as well. The economy is different today and college grads are leaving school with $50,000 to $100,000 in debt unable to find jobs. Experts say allowing college graduates to discharge their student loan debt in bankruptcy will allow them to have a ‘fresh start’ and return to being participants in the economy.

The ability to discharge student loans in bankruptcy has become increasingly difficult over the years to the point where now the borrower has to prove that any student loan, even a privately issued one, would cause an “undue hardship” to them in order to get it discharged. Another hurdle is that in order to discharge a student loan debt, a debtor must file a separate action and argue in front of the bankruptcy court, a process that usually requires an attorney and additional money.

Experts have proposed a number of fixes that would help out borrowers stuck under unmanageable debt burdens. One proposal discusses allowing all private loans to be dischargeable in bankruptcy. Another discusses loan forgiveness programs — in which a borrower repays an affordable amount over 20-25 years before getting the rest discharged. Another proposal allows bankruptcy courts to value a debtor’s student loan at its fair market value, which is what another investor would be willing to pay to buy the loan off the original lender, and discharge anything above that value. A similar process is currently available to some debtors on their mortgages in bankruptcy.

Experts on the topic still feel it is going to take a lot more than the President’s recent proposal and bankruptcy to fix the system. It’s really going to come down to looking at institutions, both for profit and nonprofit, who are doing innovative things to get students to graduation and employment.

Click here to read more on how bankruptcy could help solve the student loan debt crisis.

Bankruptcy Law, Credit, Timothy Kingcade Posts

President Obama’s New ‘Ratings System’ and what it means for Student Borrowers

Posted on August 26, 2013by Admin

President Obama recently went on a two-day bus tour to push a new proposal aimed at creating a college ratings system that evaluates schools on a number of criteria including tuition, graduation rates, debt of graduates and alumni’s earnings.

He claims the ratings system will make college more affordable since federal aid will be allocated based on the results of the ratings.

College affordability is something President Obama has stressed will help restore the middle class since his election into office. The student loan debt epidemic is affecting all age brackets and more than 38 million Americans.

On August 9, the president signed the Bipartisan Student Loan Certainty Act, which ties interest rates on Stafford and PLUS loans to the fluctuations of the 10-year Treasury bond. But while the passage of this new law, which Republicans and Democrats claim will help students, is temporarily lowering interest rates, in five years, it is estimated that interest rates will actually end up being higher than before the bill was signed. According to the Congressional Budget Office, it will make the government an extra $715 million.

The CBO reports that the government is already making an estimated $184 billion from student loans — and this new bill increases the number to a staggering $184,715,000,000.

Click here to read more on Congress’ latest student loan bill and the President’s new ratings system.

Bankruptcy Law, Timothy Kingcade Posts

Kodak’s New Strategy after Emerging from Chapter 11 Bankruptcy

Posted on August 23, 2013by Admin

A Manhattan bankruptcy judge recently approved a plan for Eastman Kodak to emerge from Chapter 11 as early as September 3rd, 2013. The new company will be vastly different from the once dominant film company that virtually invented amateur photography.

Manhattan bankruptcy judge Allan Gropper, in approving the plan, called it a necessary preliminary to Kodak regaining what he called “its position in the pantheon of American business.”

After decades of seeing its traditional business diminish as a result of foreign competition and digital photography, Kodak was forced to seek bankruptcy protection. Kodak said in a statement that it is transforming itself into a seller of digital printing services to other businesses. That does not mean the company’s traditional consumer products will disappear; they will now be made by another entity, owned by a U.K. pension fund. Kodak is selling its consumer film and camera business to the workers’ pension fund to settle $3 billion worth of pension obligations to its former workers in the U.K.

Click here to read more on Kodak’s new strategy after emerging from Chapter 11 bankruptcy.