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Orlando Bankruptcy Law Blog

Major lenders set to help those who sought loan modification

As the recession hit, many homeowners had no choice but to seek help from their lenders. One source of help for many in Florida was a loan modification. A loan modification under the Home Affordable Initiative in 2009 helped many people obtain new payment amounts that were much more affordable. However, those were not permanent changes, and many fear what may occur as new rates go into effect and payments again rise to amounts that may be unmanageable.

Lenders do not want to see homeowners struggle to pay. As a way to deal with the possibility of putting homeowners back in a challenging position of financial uncertainty, Freddie Mac has decided to modify some mortgages again. The move to re-modify for some will help those homeowners avoid defaulting again.

Bankruptcy can help stop home foreclosure action in Florida

The thought of going through the home foreclosure process can be stressful and even frightening for some homeowners. It may behoove some Florida homeowners to investigate how filing for bankruptcy may act as a means to stop a home foreclosure action against them.  Different types of bankruptcy can impact a pending home foreclosure situation.

Chapter 7 bankruptcy can lead to the discharge of unsecured debts. This includes overwhelming credit card debt. For many people, filing this kind of bankruptcy can free up funds to allow a family to catch up on mortgage payments and keep a home. Once bankruptcy is filed, the foreclosure action will stop while the situation is assessed in Bankruptcy Court. However, if you are substantially behind on your mortgage payments, a lender could receive permission from the court to continue a foreclosure action.

Despite laws, military still subject to home foreclosure

The home foreclosure process can be overwhelming and time-consuming. For people who are in the military and subject to long deployments, facing a home foreclosure can be even more traumatic as that military member may be unable to fight the home foreclosure action or even know what is taking place thousands of miles away. Because of the seemingly unfair nature of a foreclosure unfolding while a soldier is serving our country, there are certain laws in place to protect Florida military members. However, some institutions are circumventing those policies, and as a consequence, military members feel unprotected.

The Service Members Civil Relief Act is in place to stave off foreclosure and repossession action when a military member is overseas. But, some banks and lenders are using the fine print to their advantage and still going through with the process while a service member is unable to attend a hearing. The banks defend using a mandatory arbitration clause to pursue action by saying it is more cost-effective.

Credit card debt back on the rise for Americans

When the recession hit, many American families found themselves drowning in debt. One major unmanageable source of debt was credit card debt. For Florida residents, credit card debt led to an upswing in bankruptcy filings. While the recession has waned and the economy has improved, credit card debt is back on the rise, giving experts cause for worry.

The average credit card debt has risen for families again. It has risen to about $7,200 for the average family. According to experts, $8,300 in credit card debt is considered unsustainable. This marks six consecutive quarters of an increase in credit card debt for Americans.

Chapter 13 bankruptcy can be a useful debt repayment plan

When a person is in debt, it is customary to try to stick to a budget or implement a payment plan on one's own. While this may help some Florida residents overcome debt, others may find they get to a point where they realize the problem is beyond their control. At that point, outside assistance may be needed, so that an individual can learn how Chapter 13 bankruptcy can operate as a debt repayment plan.

Unlike a Chapter 7 bankruptcy, a Chapter 13 bankruptcy will require one to pay back some of the debt owed. The helpful part is that you can propose a repayment plan, lasting up to five years, during which time you can pay what you owe to your creditors. The type of debts that you have determines how much you will have to pay back, and situations can vary greatly based on individual circumstances. The plan you propose will also have to be approved by the U.S. Bankruptcy Court.

Florida home wrongfully pegged as home foreclosure site

The home foreclosure process can be tough to navigate, both legally and emotionally, and many people are unaware of what may be legal and what may not be. If a case gets particularly complicated and a bank acts illegally concerning home foreclosure, a homeowner will certainly want to be aware of her or his rights. One Florida homeowner is taking legal action against his bank after he says it told contractors to break in and post a notice. 

The homeowner claims that the two men who were involved worked as the bank's contractors. According to his statements, they allegedly entered his home illegally and put up a sign declaring the place to be vacant or unsecure. The lawsuit also contends the men involved told his neighbors that his house was in the midst of foreclosure.

Bankruptcy can be a step toward debt relief

For many people, there comes a time when the financial realities they face simply will not get better with time or even by carefully monitoring finances. If debts continue to grow and paying off what is owed is not an option, it may be time to pursue bankruptcy. Luckily, for many, Chapter 7 bankruptcy can lead to debt relief. Florida residents may want to learn about the different types of bankruptcy and then decide which type fits their individual situations.

One benefit of Chapter 7 bankruptcy in particular is that most debts can be discharged. This can include debts related to credit cards, medical bills and personal loans. The discharge of overwhelming debts can help restore financial order and let petitioners get fresh financial starts.

Bankruptcy will impact home foreclosure status now and in future

One of the main reasons people pursue filing for bankruptcy is to gain control over a financial situation which they have been unable to control on their own. Part of the financial struggle for many individuals involves keeping up with a mortgage payment. It is not unusual for people on the verge of filing bankruptcy to also simultaneously be in the middle of the home foreclosure process. Before a Florida homeowner begins the bankruptcy process, he or she should be aware of how it may affect home foreclosure proceedings, now and in the long-term.

First and foremost, there will be automatic stay of the foreclosure process once bankruptcy is filed. This gives a homeowner time to devise a plan and choose the best option concerning a home. However, if you are severely behind and a lender feels you may not be able to get current, that lender can still ask the Bankruptcy Court to move forward with the home foreclosure process.

Consider credit card debt when filing bankruptcy in Florida

The bankruptcy process can mean having to account for a great deal of financial information. Part of your financial life is your credit card debt. People in Florida should understand that, even if you feel the financial crisis that has led to filing for bankruptcy, this doesn't have a great deal to do with your credit card debt; that debt will be affected by bankruptcy. For those who feel the struggle they face is primarily due to credit card debt, that fact will also play a role in the process.

First and foremost, those who believe credit card debt is why they are in this situation should understand that credit card debt can be discharged under Chapter 7 bankruptcy. However, under Chapter 13 bankruptcy, you may still have to pay back that debt. Typically, a percentage of that debt will need to be repaid according to a payment plan, which will outline a specific time period for repayment.

Chapter 13 bankruptcy may be better option for Florida residents

The bankruptcy process is not a one-size-fits-all way of dealing with debt. There are different types of bankruptcy to deal with different types of scenarios. Depending on your personal situation and what kind of resolution you are after, Chapter 13 bankruptcy may be the preferable choice to deal with debt. In Florida, there are several reasons to pursue and prefer Chapter 13 bankruptcy.

First of all, Chapter 13 is a choice that attracts those whose financial hardships are temporary in nature. This may mean those who are going through a divorce or who have lost a job and who know the situation will be better within a few years. The reason Chapter 13 bankruptcy may be preferable in this type of scenario is the fact that it can halt overwhelming late fees, and you keep assets while you repay what you owe and catch up on other financial obligations.

Paul Urich
Orlando Office

Law Office of Paul L. Urich, P.A.
1510 East Colonial Drive
Suite 204
Orlando, FL 32803
Phone: 407-896-3077
Fax: 407-896-3041

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