Miami bankruptcy attorney Archives - Page 84 of 102

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Late Night Comedian John Oliver Makes ‘TV History’ by forgiving $15 million in Medical Debt

Posted on June 10, 2016by Admin

Nearly 9,000 consumers were relieved of their medical bills courtesy of HBO host John Oliver. As part of a segment examining the unscrupulous practices of debt purchasers on his show, “Last Week Tonight,” he forgave nearly $15 million in medical debt for consumers.

Oliver’s show engages in a form of investigative comedy, this time examining an overlooked industry. Institutions often sell their debt for pennies on the dollar to companies who then attempt to collect on the bills. These companies operate with little regulation and sometimes employ abusive collection practices to intimidate people into paying.

The show set up its own company to acquire $15 million worth of debt owed to hospitals in Texas, paying only $60,000 for the debt. Oliver described how “disturbingly easy” it was to set up the company; they called it Central Asset Recovery Professionals, and incorporated it in Mississippi to make the purchase.

The consumer’s medical debts ranged from $50 to more than $250,000. Since the debts were incurred in Texas hospitals, most of the people who owe money are from the state, Oliver said.

Oliver went on to say, people who owe bills should pay them but should not be forced to choose between paying medical debts and paying for food and shelter. He said people should never use credit cards to pay off medical debts.

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Those who have experienced illness or injury and found themselves overwhelmed with medical debt should contact an experienced Miami bankruptcy attorney. In bankruptcy, medical bills are considered general unsecured debts just like credit cards. This means that medical bills do not receive priority treatment and can easily be discharged in bankruptcy. Bankruptcy laws were created to help people resolve overwhelming debt and gain a fresh financial start. Bankruptcy attorney 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, Student Loans, Timothy Kingcade Posts

The Battle for Student Loan Debt Discharge

Posted on June 8, 2016by Admin

Section 523(a)(8) of the Bankruptcy Code outlines a debtor’s ability to discharge student loan obligations. Under this section, student loans are presumably nondischargeable. However, there is a narrow exception if a debtor is able to show that repayment of their student loans will cause an “undue hardship.”

Two courts recently entered decisions on this issue within the same week, using the same standard for “undue hardship.” The District Court for the Middle District of Alabama and the Bankruptcy Court for the District of Idaho issued largely opposite decisions based on similar facts.

In ECMC v. Alexandra Elizabeth Acosta-Coniff, the bankruptcy court initially held that the debtor was able to meet the undue hardship threshold and discharge her $112,000 of student loans. However, on appeal, the district court reversed the decision.

The case involved a 44-year-old single mother of two who took out more than $100,000 in student loans pursuing four degrees, including two master’s degrees and a PhD in special education. As a full-time public school teacher, the debtor argued that the student loans were an undue hardship, as she was underpaid with no prospects to increase her earnings in the near future.

The court used the test for undue hardship, where the debtor must establish:

(1) That he or she cannot maintain, based on current income and expenses, a “minimal standard of living for herself and her dependents if forced to repay the loans;

(2) that additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and

(3) that the debtor has made good faith efforts to repay the loans.”

The district court denied the debtor’s discharge of the loans based on the second factor, holding that the debtor did not satisfy the burden to show that there are additional circumstances preventing her from fulfilling her payment obligations. The court reasoned that the debtor chose to earn four degrees with a general understanding of the cost versus benefit analysis and her multiple degrees enabled her to seek employment on a larger pay scale.

It reasoned that the debtor’s future ability to earn extra income was a realistic possibility, negating the need to discharge her student loans.

In Elizabeth M. McDowell v. Education Credit Management Corporation, and U.S. Department of Education, the court reached the opposite decision under the Brunner analysis.

There are essentially three criteria a debtor must meet under the Brunner analysis.

Continuing to pay the loan must cause the borrower to be unable to sustain a minimum standard of living;
The borrower’s financial situation must be unlikely to change in the future;
The borrower must have made a good-faith effort to pay his or her loans.

The debtor, a 43-year-old single mother of two, owed $93,000 in student loan debt for both her undergraduate and graduate degrees. The debtor was steadily employed as a social worker, but had recently taken a $6,000 trip to South America to attend training for a career switch to photography. The debtor also financed the purchase of a motorcycle for her ex-husband.

At trial on the issue of undue hardship, her doctor testified that her health was deteriorating, and it was likely that she would be unable to work in the near future. Due to this fact, the court found her health condition to be an additional circumstance that would persist, or worsen, in the near future, satisfying the second requirement of the Brunner test.

The court recognized that the debtor made certain financial errors in the past, such as her trip to South America and the purchase of a motorcycle. However, the court held that she otherwise lived modestly while working full time. Ultimately, the court held that the debtor could discharge most of her loans, except for $10,000 which the court determined to be frivolous spending.

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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.

Related Resources:

http://www.lexology.com/library/detail.aspx?g=8b4f44fe-0baa-4e50-b4f8-d77adda86096

http://www.usnews.com/education/blogs/student-loan-ranger/2014/08/13/debunking-the-student-loan-bankruptcy-myth

Bankruptcy Law, Credit, Debt Relief

Bankruptcy Counseling: What it is and What to Expect

Posted on June 6, 2016by Admin

Deciding to file for bankruptcy is not an easy decision, but it may be your best option if you do not see yourself paying off your debt in five years. The federal government requires two sessions of credit counseling: pre-filing counseling to start the process and pre-discharge counseling before your debts are forgiven. These sessions will help you understand how bankruptcy works and how to avoid financial devastation in the future.

The counseling sessions do not take long to complete. Here is what you can expect.

Pre-filing counseling

Pre-filing bankruptcy counseling is the first step in the bankruptcy process. If you do not go through pre-filing counseling before submitting your case to the court, it will be thrown out.

In addition to being an educational course to help you understand the advantages and disadvantages of going through bankruptcy, pre-filing counseling presents alternatives such as debt management to help you determine if bankruptcy is the best way to resolve your debt. Upon completion of the pre-filing session, you will receive a certificate of completion valid for 180 days. You will need that certificate if you decide to file for bankruptcy.

Pre-discharge counseling

Pre-discharge counseling is the final step before the court finalizes your bankruptcy and discharges your debts. This counseling offers valuable financial education to help you manage your finances in the future. It focuses on your income, expenses and strategies to help you save money.

This class covers much of the same ground as the pre-filing session but with a focus on increasing your financial literacy. You will cover topics such as understanding your credit score, living on a budget and avoiding future financial risk. You will receive a certificate upon completion that you will need to present before the court before your debts can be discharged.

Before going into either session, gather documents that outline your income, expenses and debt to expedite the process. Expect each session to take between 90 minutes and two hours.

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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 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, Student Loans

Local Doral Company Sued for Running a Massive Student Loan Debt Scam

Posted on June 2, 2016by Admin

The Federal Trade Commission (FTC) and Florida Attorney General Pam Bondi are suing the Doral-based, Student Aid Center, for illegal business practices in the hopes of recouping some of consumers’ lost money.

The Student Aid Center, which claimed to help graduates relieve themselves of student loan debt, is now facing serious legal trouble of its own. The two owners filed for bankruptcy in February, stating the company had liabilities between $1 million and $10 million.

In addition to the FTC and the State of Florida complaint, Minnesota and the District of Columbia have filed lawsuits accusing Student Aid Center of “deceptive practices.” The Minnesota lawsuit alleges one of the owner’s Instagram account frequently referenced Jordan Belfort, the money-grubbing stockbroker depicted in the Leonardo DiCaprio film The Wolf of Wall Street.) The account has since been taken down.

The owners were savvy marketers, running advertisements on social media, radio spots, Google ads promoting the tagline, “Obama Loan Forgiveness,” and even in one case, an aerial banner flying over South Beach.

The complaint brought by the FTC and the State of Florida says Student Aid Center “preyed on consumers’ anxiety about student loan debt” by falsely promising to reduce or even eliminate it.

The company demanded upfront fees in five monthly installments of $199 or more, according to the complaint- even though graduates can apply for government loan forgiveness programs free of charge. Student Aid Center went as far to tell its customers to stop paying their lenders and instead pay the company directly, the lawsuit alleges.

But although the company lured in customers by promising a 100 percent money-back guarantee, Student Aid Center later deflected those who demanded refunds by either not returning the money or returning an amount much less than what had been paid, according to the FTC.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Can an employer check my credit?

Posted on June 1, 2016by Admin

While credit checks are not the norm in the job application process, the practice is common for jobs where candidates will be privy to sensitive information or making financial decisions.

States and local jurisdictions are increasingly regulating the use of credit reports in hiring. Eleven states limit employers’ use of credit reports, and other states are considering similar legislation.

When an employer checks your credit they are reviewing your credit report, not your score. What are they looking for? In most cases they want to see evidence that you are honest and responsible- this is not always the best indicator of either.

It is important to remember that the employer needs to ask your permission and receive written consent, before running a credit check. If your poor credit disqualifies you, the employer is required to let you know and give you a chance to respond.

Regardless of where you stand, it is a good idea to take a look at your credit report before you start a job search. Check for inaccuracies and take steps to correct them. Remember, there are three different credit bureaus—Equifax, Experian and TransUnion. You can access your FREE credit report at AnnualCreditReport.com.

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Bankruptcy Law, Credit, Debt Relief, Student Loans

Student Debt Relief Scams Targeting Borrowers

Posted on May 31, 2016by Admin

If you are struggling with student loan debt, you’re not alone. The FTC and the State of Florida announced lawsuits against two “alleged” student loan debt relief agencies. Consumer Assistance Project and Student Aid Center promised to get borrowers’ loans forgiven or significantly reduced, according to the FTC.

Consumer Assistance targeted borrowers online and over the phone, claiming they would get relief through government or by disputing loans. Student Aid Center used radio ads, text messages, and featured ads in search results, promoting “Obama Loan Forgiveness.”

But borrowers who paid the companies did not get their loans forgiven or even reduced. At most, the companies got borrowers’ loans put into deferment or forbearance, where loan payments are postponed, but interest still accrues.

Student Aid Center made certain situations worse by telling people to stop contacting their lenders and pay them, instead. Borrowers ended up paying thousands, but did not get the promised relief.

Student loan forgiveness programs are available in very limited circumstances. The FTC has the following new materials to help borrowers:

Student Loan Debt Relief explains how to spot a debt relief scheme, and what people struggling with student loans can do to help themselves.
Maria and Rafael Learn the Signs of a Debt Relief Scam tells the story of a couple trying to repay debt they accumulated for their daughter’s college education. It is the latest in a series of graphic novels to raise awareness about scams targeting Latin communities.
This list shows every company and individual ever banned from providing debt relief and mortgage assistance relief services by an FTC order.

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

Surge in Student Loan Debt Cancellation Requests

Posted on May 26, 2016by Admin

The Obama administration has received nearly 20,000 applications from Americans seeking to have their student loan debt cancelled on the grounds they were deceived by the universities they attended. The increase has led to the government forgiving tens of millions of dollars for borrowers.

Under a decade-old law, known as the “borrower defense,” borrowers are entitled to have their loans forgiven if they can prove their school used deceptive advertising and recruiting practices. This law had sat dormant for years. However, last year the Education Department, at the urging of student activists, started using the law to cancel loans taken out by former students of Corinthian Colleges. The for-profit chain was liquidated in bankruptcy last year after federal regulators accused it of running advertisements that cited false statistics on the employment status and earnings of graduates.

As of January, the agency had received about 7,500 applications for forgiveness from borrowers owing a combined $164 million. The agency continues to review applications on a case-by-case basis. It has agreed to cancel more than $27 million in debt for 3,421 borrowers, many of them former Corinthian students.

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Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

When Bankruptcy is the Best Option

Posted on May 25, 2016by Admin

Filing for bankruptcy is not the end of the world. In fact, it can help improve your overall situation and relieve the financial stress you are facing. Bankruptcy stops collection calls, lawsuits and wage garnishment. It wipes out most, sometimes all of your debt and can improve your credit score.

Many credit bureaus and scoring experts will disagree, not seeing the whole picture. For most people after struggling with insurmountable debt for sometime, their credit score has already greatly been affected by the time they file for bankruptcy.

Once they file for bankruptcy, their credit score typically increases. If the debt is erased, which is also known as a “discharge,” scores can increase even more- typically within a year. Accessing data from the Equifax credit bureau, researchers at the Federal Reserve Bank of Philadelphia found that filers’ credit scores plunged in the 18 months before filing for bankruptcy and rose steadily after that. The average credit score for someone who filed Chapter 7, the most common type of bankruptcy, in 2010 was 538.2 on Equifax’s 280 to 850 range. (Scores in the low 600’s and below are generally considered poor.) By the time the filers’ cases were discharged, usually within six months, their average score was 620.3.

Credit scores are not the only factor to consider when making the decision to file for bankruptcy. People who file for bankruptcy benefit from the “automatic stay,” which stops all collection activity, including lawsuits, wage garnishment and collection calls. A Chapter 7 bankruptcy wipes out a number of debts, including: credit card debt, medical bills, personal loans, civil judgments (excluding fraud), past-due rent and utility bills, business debts and older tax debts.

Most of us feel we have an ethical obligation to repay our debts, if we are able to. But oftentimes, people find themselves in over their head before realizing they need to consider bankruptcy as an option. Some continue to pay down debt they may never be able to pay off, prolonging the damage to their credit score and diverting money that could be put into retirement savings.

Bankruptcy is likely your best option if your consumer debt (any of the debts listed above) total more than half your income, or if it would take five or more years to pay off that debt, with extreme fiscal measures.

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Bankruptcy Law, Credit, Foreclosures, Timothy Kingcade Posts

Don’t think you can buy a home after bankruptcy? Actually, you can.

Posted on May 24, 2016by Admin

There are a number of myths associated with bankruptcy; the inability to purchase a home is one of them. Bankruptcy is certainly not the end of homeownership. In fact, all major mortgage programs available today- conventional, USDA, VA and FHA home loans-have established guidelines that allow post-bankruptcy buyers to qualify for a mortgage.

Each loan type has its own waiting period requirement after bankruptcy. Waiting periods for the four major types of loans are as follows:

FHA loans: 2 years
VA home loans: 2 years
Conventional mortgages: 4 years
USDA home loans: 3 years

While these are the “standard” guidelines, you may qualify for a conventional or FHA loan even sooner. Both of these loans have exceptions for “extenuating circumstances” or one-time events that caused income loss and were outside of the homeowner’s control.

In this case, an applicant can be approved for a conventional loan just two years after bankruptcy, and an FHA applicant can receive approval after one year in the “Back to Work Program.”

Below are some quick and easy ways to re-establish your credit after bankruptcy.

Re-establishing your credit involves opening credit accounts and paying them on-time for at least 12 months. These credit accounts must be kept open and active.
Begin with a credit card. Use it for gas and groceries and pay it down every month. Keep a small balance on it so the credit bureaus can see that it is active, but keep the balance below 30% of your available balance.
The credit bureaus value a diverse credit profile, more than just credit card accounts. Personal loans, student loans and car loans are other types of credit. Credit bureaus want to see that you can manage your credit responsibly.
Lenders may look for non-traditional credit. For example, 12 months of cell phone bill, gym membership, car insurance, cable bill, etc.

With proper planning, you can re-establish your credit to the level at which you can qualify for a home loan.

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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.

Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Bankruptcy Judge Rules that Bitcoin is Property, Not Convertible Currency

Posted on May 23, 2016by Admin

On February 19, 2016, a Northern District of California bankruptcy judge ruled in In re Hashfast Technologies LLC that, for purposes of valuation under the fraudulent transfer provisions of the U.S. Bankruptcy Code, Bitcoin is not the equivalent of U.S. dollars.

The case involved an adversarial proceeding brought by the bankruptcy trustee against a medical doctor who had been paid 3000 Bitcoin in 2013 by Hashfast Technologies LLC to promote Hashfast’s Bitcoin business. Evidence showed that, although the 3000 Bitcoin had an approximate value of $360,000 when “paid” to the defendant in 2013, it had since appreciated to a present day value of $1.2 million.

Hashfast filed for bankruptcy in May 2014, and the trustee sued to avoid the Bitcoin transfer under the fraudulent transfer provisions of the Code. The dispute that led to the ruling was how the Bitcoin should be valued for purposes of recovery to the estate should the transfer be successfully avoided. Was Bitcoin property (to be valued at its current value) or currency (to be valued as of the time it was transferred)?

Under Section 550(a) of the Code, if a transfer is successfully avoided, the trustee is entitled to recover “the property transferred, or, if the court so orders, the value of such property.” Thus, the trustee argued that the Bitcoin were property and that the estate was entitled to recover either the 3,000 Bitcoin or their current appreciated value of $1.2 million. The defendant in turn argued that Bitcoin were not property for purposes of Section 550(a), but rather the equivalent of their lower U.S. dollar value.

The judge concluded that Bitcoin were “clearly property.” He ruled that “[t]he court does not need to decide whether bitcoin are currency or commodities for purposes of the fraudulent transfer provisions of the bankruptcy code. Rather, it is sufficient to determine that, despite defendant’s arguments to the contrary, bitcoin are not United States dollars. If and when the Liquidating Trustee prevails and avoids the subject transfer of bitcoin to defendant, the court will decide whether, under 11 U.S.C. § 550(a), he may recover the bitcoin (property) transferred or their value, and if the latter, valued as of what date.”

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