Miami bankruptcy attorney Archives - Page 98 of 100

Bankruptcy Law, Credit, Timothy Kingcade Posts

Student loans come with Unexpected Hardship for some Borrowers

Posted on April 29, 2014by Admin

For borrowers who take out private student loans, the death of a parent can come with an unexpected hardship. Even borrowers who have a perfect payment history can face sudden demand for payment in full or be forced into default if the co-signer of their student loan passes away. Many students who take out loans for college have minimal income or have yet to build up enough credit, so borrowing from banks and other private lenders often require a co-signer, usually a parent or other relative.

The problem arises from a little known provision in private loan contracts, which states: “If the co-signer dies or files for bankruptcy, the loan holder can demand complete repayment, even if the borrower’s payment record is spotless.” If the loan is not repaid, it is declared to be in default and can do damage to a borrower’s credit record that can take years to repair.

The Consumer Financial Protection Bureau said that after a co-signers death or bankruptcy, some borrowers are placed in default without ever receiving a demand of repayment. An increase in consumer complaints indicate this is becoming a common practice among certain banks and private lenders; some are even doing this automatically- combining public records of deaths and bankruptcies, comparing them to loan records and generating repayment demands and default notices.

A little known fact: Borrowers can have their loans released from the co-signer requirement if they have a few years of earnings and credit history, or have the loans transferred to a new co-signer. However, many borrowers are unaware of this because the loan companies make it difficult to exercise these options.

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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 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, Timothy Kingcade Posts

An Increasing Number of Borrowers Seek Student Loan Debt Forgiveness

Posted on April 23, 2014by Admin

As education costs continue to increase, so do the number of borrowers enrolling in federal student loan debt forgiveness programs. The U.S. Education Department reports a 40% increase in the just the last six months. The cost of education has increased in recent years- up 6% in 2014 alone. The Obama administration recently proposed capping debt forgiveness at $57,500 per student.

The programs—especially the one revamped by President Barack Obama in 2011, Pay As You Go—forgives federal student loans after borrowers have paid a certain percentage of their income for a certain number of years. These programs aim to make sure borrowers are not prohibited from working in public sector jobs as a result of having to make astronomical student loan debt payments or pay their loans into retirement. These programs could reportedly cost the federal government as much as $14 billion a year.

Students have argued that these programs are necessary- particularly for those who want to take lower-paying jobs in the public sector. These programs are notably one of very few ways to get out of student loan debt. Unlike consumer debt, not even declaring bankruptcy or death can remove these debts. Private student debt is even harder to eliminate; A New York Times report on Tuesday found that when a cosigner dies, many private student lenders are now demanding early repayment for their student loans.

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Bankruptcy Law, Credit, Timothy Kingcade Posts

Men vs. Women: Does Gender Matter when it comes to Debt?

Posted on April 15, 2014by Admin

While no person falls neatly into statistical averages, understanding the differences between men and women when it comes to debt management can help couples understand each other’s “money personalities.” According to credit counselors interviewed in a recent study, women more often handle the household budget, paying bills and spending money on necessary and discretionary items.

Because of this day-to-day spending responsibility, women carry more guilt for debt woes, which can be compounded if their spouses blame them. Women appear to shy away from debt compared with men, according to an Experian analysis released last year. On average, men carried 4.3% more debt than women. Their mortgages were also 4.9% higher than home loans taken out by women. The study also found that women used less available credit on their credit cards than men- 30% versus 31%.

While men may appear to be more comfortable taking on more debt, they also get into financial trouble more often. Experian found that men were more likely to fall 60 days or more behind on their mortgage payments than women – 5.7% versus 5.3%. Despite having more problems handling a larger debt load, men seek help later than women, according to credit counselors.

Several of the counselors interviewed said women respond to financial crisis by eliminating items on the household budget, where men work more to increase the income to get out of debt. The best solution is a combination of both along with an understanding between the two spouses.

If you have any questions on this topic or 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.
Related Resources:
http://www.foxbusiness.com/personal-finance/2014/04/02/men-women-and-debt-does-gender-matter/?intcmp=related

Bankruptcy Law, Credit, Timothy Kingcade Posts

4 Ways Debt Collectors Abuse Your Rights

Posted on April 11, 2014by Admin

Debt collectors often resort to abusive practices to try and collect on a debt. This can include lying, using profanity and even intimidating you to try and get you to pay up. Many consumers do not know that they have rights when it comes to these abusive debt collection practices. The Fair Debt Collection Practices Act (FDCPA) protects consumers from harassing phone calls, threats and abusive language debt collectors often use to obtain payment.

Do not be a victim to these most commonly used debt collection practices:

• Threats of garnishment / criminal action. If a debt collector calls and threatens to garnish your wages, it’s a lie. The only exceptions are for student loan debt and taxes. A debt collector must sue you, first and this can take months.

• Calling too late or too early. The law states that a debt collector can only call you between the hours of 8 a.m. and 9 p.m. in your time zone.

• Calling your neighbors or employers. Debt collectors cannot reveal who they are or why they are calling. If they do not abide by this, they run the risk of having a lawsuit filed against them for releasing third party information.

• Not putting it in writing. Do not settle a debt if it is not put in writing by the debt collector. If you give a debt collector access to your bank account, they can take everything and leave you with nothing to pay your rent and bills.

These tactics are illegal and should be reported to the U.S. Consumer Financial Protection Bureau (CFPB). To learn more about the FDCPA and the protections it offers, watch this short video: https://www.youtube.com/watch?v=5o-ci9nVEgA.

Bankruptcy Law, Credit, Timothy Kingcade Posts

BOA ordered to pay customers $727 million for illegal credit card actions

Posted on April 10, 2014by Admin

The Consumer Financial Protection Bureau (CFPB) has ordered Bank of America to pay $727 million to consumers who were misled by its credit card add-on products. The CFPB says 1.4 million consumers were affected by the bank’s deceptive marketing tactics and 1.9 million accounts were illegally charged for these credit monitoring products.

The CFPB’s complaint is alleging that from 2010 to 2012 Bank of America marketed “Credit Protection Plus” and “Credit Protection Deluxe,” two products said to help cancel some debt if a borrower was faced with financial hardship. According to the complaint, telemarketing scripts provided to BOA employees contained misstatements and omitted important information that misled consumers.

Bank of America has already reimbursed consumers for the unfair billing practices related to the identity protection products. For the credit protection products, remaining BOA customers will receive a credit to their accounts. Consumers are not required to take any action to receive their refunds.

Bank of America is also required to make a $20 million penalty payment to the CFPB’s Civil Penalty Fund. In addition, the Office of the Comptroller of Currency is ordering BOA to pay $25 million in civil money penalties for its unfair billing practices.

Click here to read more on this story.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Bankruptcy linked to GM’s faulty ignition switch recall?

Posted on April 9, 2014by Admin

Federal authorities are investigating whether GM committed bankruptcy fraud by concealing its ignition switch defect when it filed for bankruptcy back in 2009. The ignition switch problems led to the recall of 1.6 million vehicles last month.

GM is a different legal entity than the one that filed for bankruptcy in 2009. The “new” GM is not responsible under the terms of its bankruptcy exit for legal claims relating to incidents that took place before July 2009. Those claims must be brought against the “old” pre-bankruptcy GM.

The class action lawsuit said plaintiffs should be allowed to sue over the pre-bankruptcy actions “because of the active concealment by the Old GM and GM.” The lawsuit has also said that GM is responsible for reporting to the federal government any safety-related problems for cars made before its bankruptcy.

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Bankruptcy Law, Credit, Timothy Kingcade Posts

U.S. Supreme Court to decide Bankruptcy Case Involving Inherited Retirement Funds

Posted on April 8, 2014by Admin

Clark v. Rameker, a bankruptcy case having to deal with inherited retirement funds could have an impact on future bankruptcy cases across the U.S. The case involves a personal bankruptcy filed in 2010 by a husband and wife after the pizza shop they opened failed. It left the couple nearly $700,000 in debt to their landlord, mortgage lenders and business creditors.

The wife inherited approximately $450,000 from her mother’s IRA when she passed away. The couple argued that these funds were protected from their creditors. Federal bankruptcy code allows up to $1.3 million in retirement funds (i.e. – Roth IRA’s, 401K’s, etc.) be exempt from creditors. However, the issue before the Supreme Court is whether someone else’s IRA that was inherited by the debtor is allotted that same protection.

The bankruptcy trustee in this case argues that the funds should be made available for repaying the couple’s creditors and that once the IRA money is passed down to an heir, the money no longer functions in the same way the retirement money once did (i.e. – it is no longer subject to penalties and taxes).

The trustee appealed to a three-judge panel and the appellate court held that the funds ceased to be protected when they were inherited. The appellate court’s decision conflicts with the two other court decisions holding that retirement funds remain protected even if they are passed down through inheritance.

The Supreme Court’s decision will settle the dispute. The Court noted that retirement funds are the only ones listed in the Bankruptcy Code that do not specifically note that it has to be the petitioner’s property. In order to settle the matter, the Court must interpret Section 521(b)(3)(C) of the Bankruptcy Code, which states that “retirement funds to the extent that those funds are in a fund or account that is exempt from taxation” are protected in bankruptcy cases. This decision is seen as an important one because it will have an impact on future cases, but experts say it will be months before the Court issues its ruling.

Bankruptcy Law, Timothy Kingcade Posts

Divorce often tied to Bankruptcy

Posted on April 2, 2014by Admin

A recent study from the Minnesota Population Center at the University of Minnesota revealed that the age-standardized divorce rate has grown by 40 percent since 1980. The age-standardized divorce rate is an important factor in calculating divorce risk, because the U.S. had a younger population in 1980 and statistically younger couples are at a higher risk of divorce. The study also revealed that since 1990, the divorce rate for those ages 60 to 65 has tripled.

Divorce can be costly for a variety of reasons and is a common cause of many bankruptcy filings. Considering the court costs, attorney fees and similar expenses, the divorce process can cause financial hardship. Not to mention splitting into two households, the financial strain of alimony or child support payments and the loss of certain economic benefits associated with marriage.

Depending on your unique circumstance, bankruptcy may be better to file before or after divorce. In some instances it can be advantageous to file for bankruptcy before divorce. Eliminating your debts can simplify the divorce settlement process. On the other hand, filing a joint bankruptcy can save on court costs and legal fees. Incomes generally decrease after a divorce so while you may not qualify for bankruptcy prior to divorce, you may qualify for it afterwards.

The best way to determine if and when bankruptcy is the right option for you before a divorce is to speak with 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.

Related Resources: http://www.digitaljournal.com/pr/1826759

Bankruptcy Law, Timothy Kingcade Posts

How to get your Student Loan Debt Erased

Posted on April 1, 2014by Admin

Two-thirds of college students in the U.S. are graduating with some level of debt. According the Institute for College Access and Success, the average borrower will graduate $26,600 in the red. That’s a staggering number! Getting student loan debt erased in bankruptcy court is difficult, but not impossible. Several recent court decisions have challenged the notion that only the worst-off borrowers, typically those who are permanently disabled, can get student loan debt erased.

In many cases, borrowers filing for bankruptcy do not even ask about their student loan debt being discharged because they figure it’s a rare possibility. A recent study published in the American Bankruptcy Law Journal, found that only 213 out of 170,000 student loan debtors tried to have their education debt discharged by filing what’s known as the “adversary proceeding.”

Of those who tried to get their student loan debt discharged, two out of five received at least some relief. Based on the characteristics of those who were able to get discharges, the researcher who conducted the study calculated that an additional 69,000 people who filed for bankruptcy that year would have a “good chance” of erasing their student loans after filing adversary proceedings.

The study concluded that one reason so few student loan borrowers seek to discharge their student loan debt is because they have been convinced that it is a hopeless fight. A borrower must prove that repaying his or her student loans would be an “undue hardship.” This means meeting following requirements:

1.) A current inability to pay the loans, because doing so would not allow you to maintain a minimal standard of living given current income and expenses;

2.) A future inability to repay the money, because your financial situation is likely to continue;

3.) A good-faith effort to repay what you owe.

In two recent decisions, courts granted relief to borrowers who had not made voluntary payments on their debt and who refused to enroll in income-based repayment plans. The appeals court judges in both cases said enrolling would have been pointless given the women’s incomes. In a third case, the borrower was both employed and healthy, but wage garnishments by his student lenders left him unable to support his wife and two children.

Bankruptcy Law, Credit, Timothy Kingcade Posts

What to do if an employer wants to pull your credit

Posted on March 27, 2014by Admin

Running credit checks on job applicants is a fairly common practice. There are credit reports that are designed specifically for potential employers use. Here is what you need to know about them. These reports contain much of the same information found in credit reports pulled by lenders, but do not show your account numbers, date of birth or references to your spouse. Also, your credit score will not be included in these reports.

These reports contain basic personal information (i.e. – your home address and your maiden name), information on public records like bankruptcies or liens and your credit history. These reports also include your work history. Employer credit checks are referred to as a “soft pull” on your credit, meaning it will not affect your credit scores.

A potential employer cannot legally pull your credit report without your permission. You will have to sign a release form giving the potential employer access to this information. It’s always a good idea before beginning your job search to pull your credit report and fix any errors. You are entitled to your credit reports for free every year from the three major credit reporting agencies.