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Orlando Bankruptcy Law Blog

Loan modification scams can further damage shaky finances

Florida real estate was hit especially hard by the recent recession. Many residents found themselves with mortgage payments that they were unable to pay or owing more on their homes than they were worth. Some of those facing foreclosure felt that they had no option other than to seek a loan modification as they worked to stay in their houses. Many who sought a loan modification ended up becoming victims of scams and now wish that they had filed for bankruptcy instead. One such scam that began after the economic collapse of 2008 has resulted in jail time for its "ringleader."

According to reports, the Florida man and his cohorts in the scheme promised homeowners loan modifications that they apparently never intended to provide. They went as far as to collect payments from the struggling homeowners that were to go toward the allegedly approved loan modifications. A Florida court has found that the company's actions were fraudulent.

Being behind on house payments leads to harassment by bank

For a homeowner, there may be nothing more frightening than the calls from the bank when struggling to keep up with a mortgage. Whenever a homeowner is behind on house payments, he or she still has rights and deserves protection from harassment or illegal action from his or her bank. One couple recently sued and won a settlement from their bank after proving that they were harassed once they fell behind on house payments. Any struggling Florida homeowner concerned with harassment over a mortgage or how to stop creditor harassment in general may be interested in what this couple endured.

Once the couple fell behind, they say the calls started. They report that they received 700 calls from Bank of America over a four-year period. They also have a son who was employed as a mortgage broker. He attempted to contact the bank about a possible loan modification and contends that he was unable to get anyone on the phone. He noted the harassment and unrelenting calls that would plague his parents' cell phones and home phone.

Credit card debt can be handled through bankruptcy

There are many reasons people find themselves in situations where they feel they may need to turn to bankruptcy to regain financial footing. One common reason is the use of credit cards. In fact, credit card debt can spiral out of control and leave Florida families with no alternative other than to file for bankruptcy.

If credit card debt has become unmanageable, there may be an influx of calls from creditors. Some creditors have been known to tell those in debt that new bankruptcy laws mean that credit card debt is not dischargeable if a bankruptcy is filed. It is important to understand that this is simply not true.

There are ways to stop harassment by your creditors

Whenever a family is struggling with debt and dealing with credit issues, the stress can be overwhelming. Harassment by your creditors can make this already stressful time much worse. It may make Florida residents feel better to know that there is help out there, and there are ways to put an end to the harassment by your creditors.

Even though the harassment by creditors may be technically just an unwanted phone call, the threats and tactics used by some can be beyond intimidating. A creditor may threaten to garnish wages. One may even claim to have the power to foreclose on your property unless you pay what he or she says you owe. Any attempts to rectify the situation or make arrangements to deal with the debt may also fall on deaf ears.

Price increase in Florida may help people avoid home foreclosure

Many people bought homes when prices were high in early 2006, right before the recession hit. This meant that, when that recession hit, those homes were worth less than when bought, meaning many were under water in their mortgage and unable to simply sell a home they may not have been able to afford any longer. There has been a steady improvement in the market, and some recent good news in Florida markets may help those still struggling avoid the possibility of home foreclosure.

The latest data reports that south Florida saw a double digit gain in home prices. This gain was noted as being much better than the gains made by the rest of the country. Three counties in Florida -- Miami Dade, Broward and Palm Beach -- had an over 10 percent increase in housing prices. This rate compares to a 4.8 percent increase across the nation.

Stripping a second mortgage may be tip for keeping home

The recession led to a situation where many homeowners were in a position where they were paying on homes that were worth less than what they owed. This situation meant that many of those Florida homeowners could not simply sell their homes when the mortgage payment was too much to handle. For those who have a second mortgage to pay also, finding ways of stripping a second mortgage may be one way to keep a home and avoid the dreaded home foreclosure.

There are circumstances where filing Chapter 13 bankruptcy can open the door to stripping that second mortgage. This option can result in a homeowner keeping a home under the original terms of a mortgage. While this may not be the best option for everyone, it may help countless homeowners in need if they were approved for the process after a valuation of property.

Ways to overcome credit card debt and rebuild credit

No one is immune to debt and the pitfalls that come along with getting too much in debt. When debt becomes debilitating, it can be difficult to deal with mounting bills and find ways to improve credit ratings and scores. However, there are tips for those in Florida who wish to get a handle on credit card debt and ensure a better credit rating in the future.

One piece of advice is to keep accounts open. Paying off the balance is a great step toward financial independence, but that should not lead to closing out an account. By keeping the account open with a zero balance, the account benefits credit history checks by helping to improve credit ratings.

Credit card bills may rise for some in Florida

When it comes to credit cards, a portion of the debt any family carries is due to the interest rates on those cards. For Florida families, credit card bills may be difficult to keep up with, and the interest rates play a major role in how long those cards may take to pay off. It may surprise some to learn that credit bills may rise soon as federal influences can lead to higher rates.

It is reported that the average interest rate on credit cards is about 14 percent. Some cards are over 20 percent, which can add significantly to the balance over time. The prime rate for credit cards is linked to the federal funds rate, which is essentially controlled by the Federal Reserve. That rate is set to go up in 2015.

Bankruptcy can help stop home foreclosure

The thought of losing a home due to financial difficulties is often a homeowner's worst nightmare. While the home foreclosure process can be scary and overwhelming for many, knowing the options and possible ways to halt or delay a home foreclosure may help countless homeowners weather a financial storm. Any Florida homeowner concerned about a potential home foreclosure is entitled to get the facts and explore the options available to confront the underlying issues.

Chapter 7 bankruptcy aids homeowners in the process of discharging many types of debts. Under this type of bankruptcy, the home may be sold, although there is a homestead exemption that may apply and could keep the property out of the hands of creditors. As Florida has a liberal homestead exemption, it is worthwhile to investigate whether a home may be exempt.

Confusion over credit card debt can delay bankruptcy

Whenever someone's financial situation has taken a turn for the worse and he or she is unable to manage things as they currently stand, that person may need to seek help. When that time comes and someone clearly needs assistance in dealing with credit card debt, there are options of which he or she should be made aware. However, if someone in Florida attempts to file for bankruptcy without the help of a professional, confusion over how credit card debt is handled may affect how that bankruptcy filing or process unfolds.

First, a consumer needs to know whether he or she qualifies for a Chapter 7 or a Chapter 13 bankruptcy. If the federal means test determines that an individual qualifies for a Chapter 7 bankruptcy, it is likely that his or her credit card debt will be discharged and that the individual will no longer be responsible for it. However, if he or she is required to file a Chapter 13 bankruptcy, he or she will likely have to repay at least a portion of the debt.

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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