Miami Bankruptcy Law Firm Archives

Coronavirus, COVID-19, Credit Card Debt, Debt Relief

Nearly Half of U.S. Adults Now Carrying Credit Card Debt Amid Pandemic

Posted on May 12, 2020by Admin

Credit card debt has dramatically increased since the coronavirus (COVID-19) pandemic, according to recent data from CreditCards.com. Their data reports that 120 million U.S. consumers, or 47 percent of all consumers, had credit card debt as of April 2020, which is a 43 percent increase from March.

Millennials were hit the hardest with 34 percent of them reporting that they used credit regularly. Experian, one of the three main credit reporting agencies, reported in March that U.S. consumer debt reached a staggering $14.1 trillion with credit cards making up $829 billion of this debt. This level is the highest seen since the Great Recession.

Bankruptcy Law, Debt Relief

The Differences Between Secured Debt and Unsecured Debt

Posted on April 12, 2019by Admin

When it comes to debt and how it is handled in a bankruptcy case, two main categories exist, namely secured and unsecured debt. Even if you are not at the point yet where you will be filing for bankruptcy, knowing the type of debt involved can make a big difference, especially when money is tight, and you are worried about which debt to pay first: the mortgage or the credit card bill.

The main difference between secured and unsecured debt is the fact that one debt is secured by collateral and the other is not. Secured debt is debt that is guaranteed by collateral, which is something of value that the lender can seize for payment in the event the borrower is no longer able to pay on the debt.

Mortgages and auto loans are classic examples of secured debt. If you default on your mortgage or your car loan, the bank can foreclose on your home or repossess your vehicle to satisfy the debt. In comparison, unsecured debt is debt that is issued to someone but is not guaranteed by collateral. The most common types of unsecured debt include payday loans, credit card debt, student loans, and medical bills.

When you are not able to continue paying on your unsecured debt, the lender cannot collect your property to satisfy the debt. However, they can report your account as delinquent, which will hurt your credit score. They can also pursue a legal judgment against you for the debt, resulting in a possible wage garnishment.

For the most part, secured debt tends to carry a lower interest rate on the amount owed. The main reason for this difference is the lender has some type of guarantee that they will receive payment, even if you default later. The lender does not have that same guarantee with unsecured debt. It is for this reason that unsecured debt tends to carry a higher interest rate because the investment is seen as more risk for the lender.

When it comes to a bankruptcy case, secured debt is handled differently than unsecured debt. If you are filing a Chapter 7 bankruptcy case, unsecured debt normally ends up being discharged at the end of the case, while secured debt can stay with the asset. If you are struggling to pay unsecured debt, such as credit cards or medical bills, filing a Chapter 7 bankruptcy case may be a viable option for dealing with the debt. If you are struggling to pay for both secured and unsecured debt, a Chapter 13 bankruptcy case may be a good option to allow you to continue paying on your mortgage and stay in your home while discharging unsecured debt at the end of the payment period. An experienced bankruptcy attorney can evaluate your financial situation, after looking at the different types of debt you are carrying to determine which plan is best for you.

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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.

Uncategorized

Common Mistakes People Make When Paying Down Debt

Posted on February 22, 2019by Admin

Credit card debt is one of the biggest problems facing those with serious financial challenges. While using a credit card responsibly can be a good way to establish credit, things can quickly get out of control when a person relies too heavily on credit cards and does not have the ability to pay off the balance every month. Paying down credit card debt can be a struggle, but many common mistakes people make when trying to pay down their debt can make that process even more difficult.

Not Addressing the Cause of the Debt

Credit card debt can add up quickly if you run into an unexpected situation, such as a job loss or medical crisis. Credit card debt can also accumulate quickly if you rely on your credit cards too much for every day, smaller expenses. If you spend more than you are making each month, and cover the overage with a credit card, these expenses can add up quickly. It pays to thoroughly review your financial situation and spending habits to see what is causing the debt and establish a spending budget that fits your income.

Adding to the Balance While Paying on the Card

If you truly want to pay down credit card debt, it is important to stop adding to the balance. Many times, people will think that they can pay off the debt while continuing to use the card. However, all this does is add new charges to an old balance that is already accruing monthly interest. No matter how disciplined you may be with paying off your new expenses every month, you may find yourself never truly making progress on the outstanding principal until you stop using the card completely. It is advisable to cut up the credit card (so you are never tempted to use it) and still pay off the debt each month. Do not call and close out the card. Depending on your total available credit, closing a credit card account with a high credit limit could hurt your credit score, particularly if you have high balances on other loans or credit cards.

Not Effectively Utilizing 0% Interest Balance Transfers

Many times, consumers will utilize promotional balance transfer offers to pay off debt by transferring credit card debt on a higher-interest card to a zero-interest card. However, if the person continues using the card and accruing a balance, he or she may never be able to successfully pay down the amount due before the promotional period ends. Once that period does end, the cardholder will be stuck with an even larger interest rate than he or she had previously.

Not Having a Plan

If you want to be successful in paying off your credit cards, you need to have a plan. One mistake many cardholders make is to make payments without any real plan when an unexpected windfall, such as a bonus or tax refund, is received. If you receive a large sum of money, it can be tempting to put all of that money towards a large balance, but it can also be helpful for the future to put that money towards a savings so that an emergency fund exists in the event it is ever needed.

It also helps to put together a plan that will actually work when paying off credit cards. If you have more than one, it helps to take one card, focus your effort on that card and then put the money that you are putting on the first card once it is paid in full to go to the next one and so on. This method is often known as the “snowball method,” and many debtors have had a great deal of success with this debt payoff plan. However, make sure to keep paying the minimum payment on the other cards while paying off the first one to avoid falling into default.

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Bankruptcy Law, Debt Relief, Timothy Kingcade Posts

Lawyer Fined and Sentenced for Bankruptcy Fraud

Posted on December 7, 2018by Admin

A Scottsdale lawyer was fined nearly $1.4 million dollars and sentenced to 18 months in prison after pleading guilty to bankruptcy fraud. Scott Allan Maasen pleaded guilty to one count of concealment of assets in bankruptcy, a Class D felony.

His sentence includes three years of supervised release after the prison term. Maasen was also ordered to forfeit a residence in the exclusive Silverleaf neighborhood in north Scottsdale, according to court documents. The house near Thompson Peak Parkway and Horseshoe Canyon Drive is on the market for $1,595,000.

Maasen filed for bankruptcy in 2009 after he stopped making payments on a $1.5 million loan guaranteed by the Small Business Administration. He admitted to purchasing a $90,000 engagement ring for his fiancée during the bankruptcy proceedings and did not disclose it, according to court documents. He concealed the purchase by using a credit card and bank account in his father’s name.

Although, most people who file for bankruptcy are honest hardworking people, some individuals can be tempted to hide property and assets. Here are some examples that if caught, could be considered criminal:

Failing to list all assets on the appropriate bankruptcy schedule;
Concealing a property transfer prior to the bankruptcy filing (i.e. – giving a boat or car to a friend or family member);
Creating a false document;
Destroying or withholding documents, and
Paying someone to help hide property from the court.

The consequences of engaging in such activities are harsh. Anyone who makes a knowingly false statement in association with a bankruptcy filing can be assessed fines up to $250,000 and receive up to 5 years in prison. Regardless of your occupation or status in life, if you are found guilty of bankruptcy fraud- you face real consequences, criminal prosecution and even jail time.

Bankruptcy trustees are experts at finding undisclosed cash, property, vehicles, boats, jewelry, antiques, and collectibles. If you are caught trying to hide assets, the consequences are big. Your discharge will be denied, and you will be unable to discharge the debts you listed in a subsequent bankruptcy filing.

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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 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, Timothy Kingcade Posts

Attorney Timothy S. Kingcade Obtains Successful Win for Bankruptcy Client

Posted on July 30, 2018by Admin

Second Motion to Dismiss Granted & Hearing Cancelled due to lack of evidence to support the claims

Bankruptcy Attorney Timothy S. Kingcade, founding partner of Miami-based Kingcade Garcia McMaken successfully obtained an Order for his client in a Chapter 7 case, granting a Second Motion to Dismiss and cancelling a hearing scheduled for July 25, 2018.

“We are extremely pleased with the victory obtained for our client today. The allegations stated in the Complaint lacked sufficient evidence to support the claims. It was simply assumed that actions taken by Torres and PSI petroleum, LLC assigned liability to our client, without providing sufficient and specific allegations. The law was on our side in this case,” Kingcade said.

On March 5, 2018, the Plaintiffs in the case: Milan Gohil and GMC Law Firm, PLLC filed an adversary proceeding seeking a judgement against the Defendant. The complaint alleged three counts: (1.) False Pretenses, Fraud & Nondischargeability; (2.) False Financial Statements & Non-Dischargeability, and (3.) GMC Law Firm Claim for Attorney’s Fees. The Order Granting the First Motion to Dismiss included a provision that allowed the Plaintiffs to file an amended complaint, and on May 6, 2018 the Plaintiffs filed an Amended Complaint to Determine Dischargeability of Debt. On May 18, 2018, Defendants filed the Second Motion to Dismiss stating the plaintiffs did not plead their claims for relief as required by law.

A court “weighing a motion to dismiss asks ‘not weather a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.’” (quoting Scheurer v. Rhodes). Federal Rule of Bankruptcy Procedure 7012, adopting Federal Rule of Civil Procedure 12, authorizes the court to dismiss a complaint that fails to state a claim upon which relief may be granted.

The Order directs the Second Motion to Dismiss be granted, all pending motions are denied as moot and the hearing on July 25, 2018 be cancelled.

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Miami-based Kingcade Garcia McMaken 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 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.

For more information visit, https://www.miamibankruptcy.com/.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Bankruptcy Provision for Big Banks Could be Trump’s Next Target

Posted on February 6, 2017by Admin

The special bankruptcy procedure for large financial institutions may be a Trump target, according to a recent article in the New York Times. The Dodd-Frank’s bankruptcy provision, originally enacted in 2010 as a response to the financial crisis, allowed the banks who were essentially “too big to fail,” do just that.

Many of the proposals to create a new part of the bankruptcy code for banks have not offered any real solutions. The proposals provide no real way to deal with anything beyond a very specific form of bank failure.

If the bank fails in any way other than as predicted, the proposed legislation would be useless. This will in turn lead to a plea from Wall Street for bailouts. If that happens during a Trump administration, it will be interesting to see what happens next.

Who could have predicted the failure of Lehman Brothers or the near collapse of insurance giant, AIG? The financial panics caused by these collapses result in mass financial destruction- even when some degree of bailout is extended.

There is no doubt that without government assistance to both the banks and the automakers, the effects of 2008-09 would have been far worse.

Click here to read more on this story.

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

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Debt Collection Dispute Headed to the Supreme Court

Posted on January 18, 2017by Admin

The U.S. Supreme Court will decide whether firms collecting on a debt they bought for pennies on the dollar can be held liable in lawsuits brought by consumers. The justices agreed to review a lower court’s decision to dismiss a consumer class action lawsuit against Santander Consumer USA Holdings Inc. over allegations it violated the Fair Debt Collection Practices Act– a debt collection law enacted in 1977 that prohibits collectors from using abusive, unfair or deceptive practices to collect a debt.

The current case hinges on the definition of “creditor” and “debt collector” and whether a company that purchases debt should be treated as a creditor and therefore not subject to the law.

The case (Ricky Henson et al v. Santander Consumer USA, Inc et al, in the Supreme Court of the United States, No. 16-349) involves four Maryland residents who defaulted on their auto loans, and filed a proposed class action lawsuit against Santander in 2012 in federal court alleging violations of the Fair Debt Collection Practices Act, such as misrepresenting the debt amount and bypassing debtors’ attorneys.

The debts had been sold to Santander, a Dallas-based vehicle-financing and lending company owned in part by a subsidiary of Banco Santander. Santander then tried to collect on the loans.

The 4th U.S. Circuit Court of Appeals in Richmond, Virginia threw out the lawsuit last March, saying the law applied only to debt collectors, and Santander became a creditor when it purchased the loans.

The Maryland residents told the Supreme Court the 4th Circuit’s reasoning would “hamper both government and private efforts to combat abusive debt-collection practices.” The appeal to the Supreme Court comes as the Consumer Financial Protection Bureau is considering proposals to toughen regulation of the industry.

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Bankruptcy Law, Debt Relief, Foreclosures, Timothy Kingcade Posts

Unauthorized Practice of Law by National Bankruptcy Law Firm

Posted on August 18, 2016by Admin

A woman filed a Chapter 13 petition signed by attorney Joseph Kosko, a former partner in the law firm of Volks Anwalt, who solicited her via direct mail. After the law firm missed numerous deadlines, the bankruptcy court held a contempt hearing regarding the representation by Kosko, Volks Anwalt, and its sole owner and managing partner, Jessica McClean.

The court issued a Notice of Deficient Filing on November 9, 2015 because the Debtor’s petition was a “bare bones” filing and did not contain all of the required schedules, statements, summaries, declarations, and local forms. Federal Rule of Bankruptcy Procedure (“Bankruptcy Rule” or “Rule”) 1007(c) requires any missing documents to be filed within 14 days of the filing of the petition or, in this case, by Friday, November 20, 2015.

The bankruptcy court found that Volks Anwalt’s business plan developed by McClean included a marketing strategy that used direct mailings targeting individuals subject to foreclosure. In the specific case, Kosko and Volks Anwalt not only failed to file the bankruptcy in time to save the woman’s home, but also failed to include her Social Security number in pleadings, did not provide her with the proper disclosures required by 11 U.S.C. §§ 342 and 527, nor intended to appear at her §341 Meeting of Creditors.

Volks Anwalt operates in 43 states. As of February 2016, the firm had handled approximately 400 bankruptcy cases since it opened in May 2015. The bankruptcy court found that Kosko violated the North Carolina Rules of Professional Conduct in terms of competence, diligence and failure to communicate with the client. In addition, Kosko, McClean and Volks Anwalt had engaged in the unauthorized practice of law, as McClean is only licensed in Florida and New York.

In the end, the court disbarred Kosko from practicing in bankruptcy court for one year, McClean for five years, and ordered all fees be emitted. Kosko and Volks Anwalt must pay the client $5,000.00.

To read the opinion in its entirety, click here.

If you 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, 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

Parents Responsible for Nearly Every New Private Student Loan

Posted on July 11, 2016by Admin

Student loans are no longer just for students. New private student loans are requiring parents to sign on the dotted line as well. This change comes as lenders continue to strengthen the guidelines on underwriting requirements. Nearly every, or 94%, of private student loans distributed to undergraduates for the 2015-2016 academic year had more than one borrower responsible for the debt–not only the student but a co-signer, according to the report.

Five of the largest private student lenders distributed $6.46 billion in loans between July 2015 and March 2016, up 7% from the same period a year earlier–and the fifth consecutive year of increases, according to recent data from MeasureOne.

Cosigners are becoming more common with graduate school student loans as well. Nearly 61% of student loans dispersed for 2015-2016 had cosigners versus 57% the previous year. For lenders, cosigners increase the chance that the loan will be repaid, avoiding defaults. When the student borrower cannot make the payments, co-signers- usually the parents- have to pay up. Otherwise lenders can report both the student and co-signer of being late to the credit bureaus. That would lead to lower credit scores for both the student borrower and the cosigner, making it harder to obtain other types of financing.

Student loans are considered among the riskiest type of consumer loans, because it is difficult to determine whether borrowers will graduate or end up with a salary that is enough to repay the debt. In case you missed it, read our blog on the dangers of co-signing.

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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.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Tips for Applying for a Credit Card after Bankruptcy

Posted on April 1, 2016by Admin

Filing for bankruptcy doesn’t mean you are shut off from new credit. Creditors look at multiple factors when determining credit eligibility. For example, your income and the time since you received your bankruptcy discharge.

If you are looking to rebuild your credit post-bankruptcy, a secured credit card is a good place to start. Secured credit cards are designed specifically for people trying to improve their credit. They are different from normal credit cards in that they require you to put down a security deposit, usually a few hundred dollars. Your deposit typically equals your credit line: For example, if you make a $400 deposit, you will have a $400 line of credit. The deposit protects the issuer if you do not make your payments. That makes secured cards a relatively safe bet for lenders extending credit lines to people with lower credit scores.

Those individuals who file for bankruptcy may receive an influx of credit card offers soon after. Proceed with caution. These cards will likely have low limits and high interest rates. The best way to qualify for a credit card post-bankruptcy is to improve your credit score. Here are some immediate steps you can take to improve your credit score after bankruptcy:

Make sure all discharged debts are cleared from your credit report. If your credit reports are still showing delinquent accounts after you receive your bankruptcy discharge, this is likely affecting your credit score in a negative way. You are entitled to a FREE credit report every year from the three credit bureaus.
Get your noncredit finances in order. Although many bankruptcies are the result of medical bills, divorce, job loss or other unavoidable debts, it is also important to remember the fundamental problems with spending, saving and budgeting. Addressing these issues before applying for new credit can help you overall.
Build credit. Once your finances are back in order, it is time to consider strategic credit building via a secured credit card or credit-builder loan.

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