Bankruptcy Law

Kristina Gonzalez of Kingcade Garcia McMaken Named a 2019 “Rising Star” by Florida Super Lawyers

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Attorney Kristina Gonzalez of the Miami-based bankruptcy and foreclosure defense law firm of Kingcade Garcia McMaken has been selected for inclusion in Florida Super Lawyers 2019 as a Rising Star in the practice area of consumer bankruptcy.

The list recognizes the top up-and-coming attorneys in the State of Florida, who are 40 years of age or younger, or those who have been practicing law for 10 years or less.  A select group of 2.5 percent of attorneys are named to the prestigious Rising Stars list.

Gonzalez has been licensed to practice law in the State of Florida since 2011. She is a graduate of the University of Florida Levin College of Law and practices exclusively in the field of consumer bankruptcy law, handling Chapter 7 and Chapter 13 filings for the Southern District of Florida.

Super Lawyers is a listing of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement, representing the top 5 percent of Florida lawyers.  The annual selections are made using a patented multiphase process that includes a statewide survey of lawyers, an independent research evaluation of candidates and peer reviews by practice area.  The result is a credible, comprehensive and diverse listing of exceptional attorneys.

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Miami-based Kingcade Garcia McMaken, P.A. was established by managing partner and bankruptcy attorney, Timothy S. Kingcade in 1996. The firm represents clients throughout the State of Florida in Chapter 7 bankruptcy and foreclosure defense cases. The firm is committed to providing personalized service to each and every client, clearly explaining the options according to the unique circumstances of his or her life. The office environment and the service provided are centered on a culture of superior client care for the financially disenfranchised. All partners and associates at Kingcade Garcia McMaken, P.A. specialize in consumer bankruptcy and foreclosure and have dedicated their practices to this area of the law. Additionally, all attorneys and staff members at the firm are bilingual speaking Spanish.

Debt Relief

Senators Take Action Against the New FDCPA Proposal

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A number of United States Senators are calling on the Consumer Financial Protection Bureau (CFPB) to reconsider a recent proposal made that would allow debt collectors to contact consumers via unlimited texts and emails, as well as increasing the amount of times they can call consumers per week.

More than 20 senators signed a letter issued to the CFPB, specifically expressing concerns they had to the proposed update issued to the Fair Debt Collections Practices Act (FDCPA), which would give debt collectors additional ways to reach consumers who owe on a debt.

The letter was penned by Senators Bob Menendez, D-NJ, and Sherrod Brown, D-Ohio, as well as 19 Democratic and two Independent lawmakers.  Several 2020 presidential candidates signed the letter, including Senators Kamala Harris, Kristin Gillibrand, Cory Booker, Bernie Sanders, and Elizabeth Warren.

The letter was specifically directed to the current CFPB Director, Kathleen Kraninger.

The main concern has to do with the fact that these changes seem to divert the FDCPA away from what it was originally intended to do, which was to protect consumers from harassment and unfair debt collection practices by third-party debt collectors. The FDCPA includes provisions to limit the time of day a debt collector may call a consumer, as well as the content expressed by the collector in the communications. Specifically, the FDCPA prohibits the following behavior from debt collectors:

  • Calling you prior to 8 a.m. or after 9 p.m.;
  • Calling you at work once you tell them not to;
  • Calling your family, friends and neighbors;
  • Threatening you with possible debt collection lawsuits;
  • Threatening you with criminal prosecution or immigration actions;
  • Talking to you abusively or profanely.

However, this new proposal was made with the mindset that consumers are reachable more easily through email or text messaging. Since these types of communications could be done at any time of the day or night and could be unlimited per the proposal, this could allow collectors to overwhelm consumers with communications. The senators expressed concern with the fact that not all consumers have unlimited text messaging, which means these communications could come at a high cost.

The new proposal does limit the time in between calls made by debt collectors. While the emails and text messages can be unlimited, collectors are limited to seven calls a week per debt. If they reach a consumer once, they must wait at least a week to call the consumer again.  Click here to read the proposed changes in full.

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.

Related Resources:

https://www.usatoday.com/story/tech/2019/06/06/debt-collection-senators-write-cfpb-letter-objecting-proposal/1361365001/

student loan debt

Why Student Loan Debt is Worse for Women

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An estimated $1.46 trillion is owed nationwide in student loan debt, affecting nearly 44 million borrowers. However, nearly two-thirds of those borrowers are women, owing a collective $929 billion of the total student loan debt, according to a recent report issued by the American Association of University Women (AAUW). Of these female borrowers, a large percentage of them are women of color.

The AAUW report also showed that the amount of student loan debt women graduate with is more than the average debt carried by their male counterparts. A woman graduating with a bachelor’s degree leaves with $21,619 in undergraduate student loans while a male student leaves with $18,880 in student loans. The AAUW report also showed that it takes women two years longer than men to pay off their student loans. Black and Hispanic women were reported as taking longer to pay off their student debt.

One of the reasons given for the disparity in time it takes women to pay off student loans has to do with the gender pay gap, as well as childcare issues. A female borrower may have to take time off work after having children or work only part-time, which would make it understandable if she took longer to pay off student loans than a male borrower. These issues of pay and childcare also seem to affect minority women more than others, which could also be a leading cause for why this group of borrowers takes even longer to pay off their loans.

According to figures from PayScale.com, women make 79 cents for every dollar a man makes. Even if a female borrower does not take time off to have children, she is at a disadvantage to her male counterparts when it comes to paying off loans. The lack of affordable, quality childcare also presents an issue, especially for minority women, which also contributes to the disparity in how long times these borrowers to pay off their loans.

To help offset these issues, many grants and scholarship programs are available for female undergraduate students. However, these programs only go so far and will only help those students who are either aware of these programs or have the resources to apply for them.

Please click here to read more.

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.

Credit Card Debt

More Than One-Third of College Students Already Have Credit Card Debt

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A significant number of college students report that they have accumulated credit card debt while attending school. According to a recent report from AIG and EVERFI, 36 percent of all college students have a credit card with a balance of over $1,000 on it. This is on top of the student loan debt they are carrying.

Many of these students are using credit cards to pay for groceries, books, or entertainment expenses. Of students surveyed, some say they choose to use their credit cards over debit cards for the benefits the cards include, such as travel miles. These students are following a nationwide trend when it comes to using credit cards to pay for everyday expenses. A recent survey showed that 23 percent of Americans use their credit cards for necessities, including rent, food, and utilities.

However, problems arise when these cardholders are not able to pay down the balance every month. The situations can get even worse if the cardholder falls behind on payments, pushing the accounts into delinquency. The Federal Reserve Bank of New York reported that more than eight percent of balances held by young cardholders between the age of 18 to 29 were seriously delinquent. Being seriously delinquent means that the accounts are at least 90 days overdue with no payment made.

The EVERFI and AIG survey found that 15 percent of college students took a hit on their credit scores because of being behind on their credit card payments. Missing a credit card payment will not only cause the card’s interest rate to skyrocket, but it will also seriously affect that person’s credit score. The higher the interest rate is, the harder it is for the person to pay off the card over time.

It can be a definite struggle for the student to handle both a credit card and student loan payment after graduation. Students should put together a plan to pay off the credit card debt as quickly as possible by setting a deadline and a goal on how quickly the person can handle paying off the card. The plan only works if the student does not continue spending on the card and makes more than the minimum monthly payment on the card.

As bankruptcy attorneys, we see credit card debt as one of the most common problems facing those with serious financial challenges.  It is not surprising with the high interest rates, unreasonable fees, and never-ending minimum payments that do not even make a dent in your actual debt. We offer additional tips for eliminating credit card debt on our blog.

Please click here to read more.

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.

 

Bankruptcy Law, Debt Relief, student loan debt, Student Loans

Possible Solutions to the Student Loan Debt Crisis

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With more than $1.5 trillion in student loan debt owed nationwide, it can be safe to say that the student loan crisis has reached a breaking point. For lawmakers, one solution to bring change to this problem is allowing student loan debt to be discharged in bankruptcy court.

Another measure that has received a great deal of public support is Senator Elizabeth Warren’s proposal to completely wipe out the majority of America’s student loan debt through a loan forgiveness program. Her proposal has received support from other presidential hopefuls, including Senators Bernie Sanders, Kamala Harris, and Amy Klobuchar, as well as Representative Eric Swallwell, all of whom are co-sponsoring it.

Recently, the American Bankruptcy Institute’s recommendations to allow student loan debt to be discharged in bankruptcy were published.

The average college student graduates with about $30,000 in student loans. This number does not include those students who pursue a master’s or post-graduate degree. Many of those students end up owing six figures in student loan debt.

The burden these loans present to young graduates is intense and can even follow them into retirement. Outstanding student loan debt can affect a person’s job in 13 states. To keep up with loan payments, many borrowers have accumulated credit card debt, just to be able to afford basic living expenses.

Student loans, while not impossible to discharge in bankruptcy, are extremely difficult to eliminate in a Chapter 7 or Chapter 13 bankruptcy case. Other obligations may be eliminated at the end of the case, but the student loan ones will stay with the borrower even after other obligations are discharged.

Bankruptcy courts use the “undue hardship” test to determine whether a filer should have his or her student loan debt discharged, but no set standard has ever been made on what qualifies as an undue hardship, making it very difficult to ever receive relief. New bi-partisan legislation has been introduced and proposes regulations that ensure student loan debt is treated like other forms of consumer debt in bankruptcy, meaning it can be easier to discharge.

Without the ability to discharge the largest amount of debt many bankruptcy filers are carrying; these individuals will never be able to receive the fresh start bankruptcy is meant to give them. While this change may not completely solve the student loan crisis, many financial experts are hopeful it can be a catalyst for change.

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. 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, Debt Relief

How to Bounce Back After Bankruptcy

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There are many misconceptions surrounding the amount of time it takes to rebuild credit and bounce back after bankruptcy.  A recent study by LendingTree, reveals that individuals who file for bankruptcy can improve their credit score sooner than they think.  In fact, more than 40 percent of consumers end up having a credit score of 640 one year after filing for bankruptcy. Approximately 65 percent of filers see the same score, at least, three years after the bankruptcy case is over.

We have some important tips to help you bounce back and stay on track after filing for bankruptcy.

Put Together a Bankruptcy File.

After the bankruptcy case is complete, chances are, the filer has a lot of paperwork. It can be very tempting to put it all away, never to look at it again, but it is important to keep all these documents handy in the event they are needed in the future. If a consumer wants to purchase a car or a home, he or she may need to produce the bankruptcy paperwork before receiving financing. It helps to stay organized and put together a file for your bankruptcy paperwork.

Look Back at the Past and Strategize for the Future.

Before moving forward, it helps if the consumer gets a clear understanding of how he or she got in the bad financial situation to begin with, whether it be due to a job loss, divorce, an illness, overspending, or just bad financial luck. It helps to take a moment and strategize how the consumer wants to move forward.

Develop a Good Relationship with a Bank.

Even if the possibility is in the distant future, if the consumer wants to qualify for a loan or make a big purchase, like a home, it is important he or she has a personal relationship with a good bank. Many times, it helps to tell them a bit about how the person ended up in bankruptcy and give them a human face to the numbers on the account.

Be Cautious in the Future.

Once a consumer is out of debt, he or she will likely receive communications from lenders offering financing for various purchases. They will see that the person no longer is in debt and will not be able to declare bankruptcy again for many years, making that person an easy target. The kind of lenders who reach out to consumers right after bankruptcy, however, are not always the most reputable lenders. Be very cautious when considering these offers.

Review Your Credit Report.

After filing for bankruptcy, it is important to periodically review your credit report. A credit report can be reviewed annually for free, and it shows not only the progress being made in rebuilding the consumer’s credit score but also any false or old charges that should no longer be on the report.

Think Before Borrowing.

It can be tempting to borrow again, believing that the consumer can handle a payment when, in fact, he or she cannot. Make sure that the payments are feasible by building a budget before applying for another loan. Also keep in mind that a credit score takes a hit after applying for a new loan, and this could quickly destroy any progress made on rebuilding the credit score.

Work on Rebuilding Your Credit.

One of the best ways to get credit back to where it once was is to pay all bills on time every month. Missing a payment is an easy way to hurt your credit score.  Using a secured credit card after filing for bankruptcy is also an excellent way to improve your credit score, as the payment history is reported to the credit bureaus. Put together a budget, see what your monthly expenses are, and stick to that budget. Make sure you have enough income every month to meet your monthly obligations, and set up automatic payments, if needed, to make sure no bills are missed.

Click here to read more on this story.

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.

 

Foreclosures

Florida Sees an Increase in Foreclosures for the Eighth Consecutive Month

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While overall foreclosure activity has declined nationwide, Florida has seen a steady annual increase for eight-consecutive months (one in every 1,415 housing units), according to ATTOM Data Solutions’ US Foreclosure Market Report. Major metros in Florida in which foreclosure activities increased from last year included Orlando, Fla. (up 90%) and Miami, Fla. (up 45%).

Receiving a notice of delinquency in the mail does not automatically mean that you are going to lose your home. Florida has what is called a judicial foreclosure process, which means that every homeowner is entitled to a hearing before the court to determine whether or not the bank is entitled to foreclose.  The most important thing to remember is that the homeowner has rights. There are things you can do to slow down the foreclosure process and even keep your home, while getting your financial life back on track.

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 McMaken website at www.miamibankruptcy.com.

Credit Card Debt, Debt Relief

25 Percent of Americans Going into Debt Paying for Daily Living Expenses

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More Americans are struggling to pay for their daily expenses and are using credit cards to pay for basic necessities, according to a recent report by Experian. This reliance on credit cards to pay for necessary living expenses puts consumers even deeper into debt. In fact, the report showed that American consumers carry an average of $6,506 in credit card debt.

Approximately 23 percent of those surveyed said that they struggled with paying for their most basic necessities, including rent, food, and utilities, and had to pay for these expenses with their credit cards. Of those consumers surveyed, 12 percent of them reported paying for medical bills with their credit cards.

It has been reported that the middle-class cost of living is now 30 percent more expensive than it was 20 years ago. The costs for essentially everything has increased over the years. According to the Economic Hardship Reporting Project, the cost of tuition at public universities and housing prices have quadrupled between 1996 and 2016.

Not only has the cost of living increased, but the amount of money Americans have in savings has decreased remarkably. A majority of American consumers say they have less than $1,000 in savings. Additionally, 70 percent of them report that they would not be able to get by if their paycheck was delayed by a week, which has many financial experts concerned.

Not all Americans are using their credit cards to pay for daily expenses, however. Many say that their discretionary spending on non-essential items, including entertainment, travel, and clothing, has led to their credit card balances. It is reported that Americans spend an average of $483 a month on eating out, entertainment, and travel, according to Schwab’s 2019 Modern Wealth report.

The average credit card APR is at an all-time high of 17.73 percent, according to CreditCards.com, which makes paying off large credit card balances, very difficult. With an average balance of $6,354, consumers could potentially be paying on these cards for years, if not decades. In fact, if someone has a credit card balance at this national average with a credit card that charges the average APR, he or she could be paying the minimum payment on that card for over 17 years before it is paid off in full. This scenario only works if the consumer stops using the card and does not add any new charges to the outstanding balance.

People living in the Miami metro area, which includes both Fort Lauderdale and West Palm Beach, carry the second-highest credit card debt balances in the country.  As bankruptcy attorneys, we see credit card debt as one of the most common problems facing those with serious financial challenges.  It is not surprising with the high interest rates, unreasonable fees, harassing debt collection calls, penalties and never-ending minimum payments that do not even make a dent in your actual debt. We offer additional tips for eliminating credit card debt on our blog.

Click here to read more on this story.

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, Debt Relief

The Dangers of Subprime Auto Loans

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Having a car for most of us is a necessity, especially if someone wants to get a job and maintain employment. However, the purchase of a vehicle can be tricky for those struggling financially. For many car buyers, a subprime auto loan seems like the perfect solution. However, these types of loans are often more trouble than they are worth, and we caution consumers before using them to finance a vehicle purchase.

What Is a Subprime Car Loan?

A subprime auto loan is a loan aimed at borrowers who have lower credit scores to help them purchase a vehicle. They are offered by various lenders, including larger national banks, as well as smaller finance companies. Many subprime car loans are offered through online lenders, appealing to those who need quick financing.

Disadvantages of Subprime Car Loans

Many different downsides exist to using a subprime auto loan to purchase a vehicle, including the following:

  1. High Interest Rates: Because subprime car loans are normally targeted towards borrowers with lower credit scores, they come with higher interest rates. In fact, subprime car loans can have interest rates that are three times what a borrower with good credit would receive. These high interest rates are meant to offset the risk the borrower poses to the lender, but what results is the borrower making higher payments for a longer period of time on a car that is nowhere near the value of the loan owed on it.
  2. Subprime Car Loans Are Expensive: Because of the high interest rates that accompany subprime car loans, the total amount the purchaser ends up paying can be significant. In fact, a large amount of what the purchaser ends up paying on a monthly basis is solely interest that serves as profit for the lender and makes no dent in the principal owed.
  3. Aggressive Debt Collection Tactics: If the purchaser is not able to keep up with payments on the subprime loan, the situation can get ugly very quickly. Some of the less-than-reputable subprime lenders have been known to be quite aggressive when it comes to collecting on a subprime loan. If the loan was obtained through a larger bank, some of these lenders may be willing to work with the borrower on a payment plan, while others will go directly to collections or even repossession of the vehicle. The last thing a borrower with a low credit score needs is a default or collection on his or her credit report, but the high interest rates on these loans can make it very difficult to keep up with payments.
  4. Vehicle Tracking for Repossession: Not every vehicle that has been purchased through a subprime loan comes with this feature, but it is a common practice for subprime auto lenders to use electronic trackers on the cars to make finding the car easier in the event the vehicle is repossessed. Other devices have been known to completely disable the car if a payment is missed or until the lender gets the car back. The problem is the purchaser may not even know this device is on the car until it is too late. If the borrower believes he or she is going to be late on a payment, it is best to let the lender know in the event this device is installed on the vehicle.

Avoiding a Subprime Car Loan

Many different options exist for a borrower who has bad credit and who still needs to purchase a car. One common solution is to find a co-signer with good credit to help get the loan. Another option is to find a second-chance lending program to purchase a car. Many lenders offer these types of programs to their customers who have less than perfect credit. However, not all lenders offer these types of programs.

In the event a borrower has no choice but to accept a subprime car loan, it is recommended that he or she keep up with payments. After a year or so of regular and consistent payments, the borrower may be able to refinance the loan with a better interest rate and loan terms.

Please click here to read more.

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.

 

 

 

Bankruptcy Law, Credit Card Debt, Debt Relief

Debt Consolidation vs. Bankruptcy: The Pros and Cons

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If someone is struggling with large amounts of debt, they may be weighing their options between debt consolidation and bankruptcy. There are positives and negatives to both- but ultimately, it depends on a person’s specific financial situation and life circumstance as to which choice is the right one for him or her.

What is Debt Consolidation?

Debt consolidation involves combining a person’s older debt from various sources into one new debt. This consolidation could be done by taking an unsecured personal loan to pay for the total amount owed or by transferring balances from multiple credit cards into one credit card.

Debt consolidation involves making payment to one lender, oftentimes at a lower interest rate.  These are two of its appealing factors.  However, we can tell you that debt consolidation rarely provides a long-term solution.  Our attorneys have helped many clients who were promised one result from a debt consolidation company only to receive far less, and stuck with the remaining debt.

Here are some of the disadvantages of debt consolidation.  

  • The debt cycle continues: While this option allows the consumer to consolidate multiple sources of debt, it only pays off that debt to combine it into one larger balance. Many consumers make the mistake of utilizing debt consolidation only to continue the cycle of debt.
  • Delaying the inevitable: Debt consolidation is oftentimes used as a ‘temporary’ fix, only delaying the inevitable. If a person is struggling to pay off various forms of debt, particularly if that debt is medical debt, credit card debt or personal loans- bankruptcy might be a better option, as the consumer would receive a complete discharge of these debts.

Choosing Bankruptcy as an Option.

Depending on an individual’s income and amount of debt, pursuing a Chapter 7 bankruptcy case may be the wisest option to discharge the debt or a Chapter 13 bankruptcy case to reorganize and pay down qualifying debt. One factor to keep in mind is debt consolidation is a big business. It can be successful for some people, but for others, it may not provide the long-term solution the consumer needs.  The attorneys at Kingcade Garcia McMaken have helped thousands of people restart, rebuilt and recover through bankruptcy.

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.

Related Resources:

https://studentloanhero.com/featured/debt-consolidation-vs-bankruptcy/