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Orlando Bankruptcy Law Blog

Chapter 13 bankruptcy may be the best tool for temporary problems

Not every personal or family financial crisis is unfixable or a permanent downward spiral. Some Florida families may find financial strain or difficult circumstances to be a temporary situation, and they know eventually they will be back on their feet. Even if it is a temporary situation, falling behind in credit card payments or a mortgage can have very long-lasting effects that require professional help to overcome. One way to overcome those difficult times may be through filing Chapter 13 bankruptcy.

While there are various types of bankruptcy available for families, Chapter 13 bankruptcy is essentially a repayment plan. The typical timeline for repaying debt that may have gotten out of control is three to five years. For some families, this offers much-needed time to get re-employed and catch up. Agreeing to this plan also means you can may be able to preserve assets that you may otherwise lose under other forms of bankruptcy.

While recovering, Florida still ranks high for home foreclosure

Being the state that was the hardest hit as far as the housing market and recession was concerned also means Florida is taking longer than other states to recover. The good news is that Florida may be on the upswing when it comes to home foreclosure filings. The bad news is that the Sunshine State is still home to eight of the top ten metro areas when it comes to home foreclosure rates.

Orlando specifically ranks eighth in the nation, according to a new report. The area is flooded with properties that are bank-owned and owners are nowhere in sight, meaning the homes are in disrepair. One recent example is a home that was worth $2.4 million not too long ago. The homeowners were in jail for some reason and not able to be served with foreclosure papers. The house was vandalized and now is only valued at $550,000.

Before seeking loan modification, consider facts

As the housing crisis hit, many homeowners turned to a loan modification as a means of keeping a home. However, there are several factors and truths about the loan modification process that Florida homeowners may want to investigate before thinking it is the only option. While a loan modification can be helpful, without proper guidance and facts, a homeowner may be missing out on more appropriate options such as filing for bankruptcy.

One truth about a loan modification is the impact on a credit rating. In order to qualify for a loan modification through a lender, a homeowner needs to be behind at least 90 days in mortgage payments. This immediately affects a person's FICO score and that can lead to other financial strain.

Recognize out of control credit card debt, explore solutions

Credit card debt is a serious problem for many American families. Before a Florida family can work to resolve credit card debt, that household must first recognize if that debt has reached an unmanageable level. If so, resolution options like discharging that credit card debt through bankruptcy may be the best solution.

One sign the debt is out of control is if bills are neglected and are left to grow along with late fees and increasing interest payments. Another sign may be if there is no clear pay-off date for being debt-free. Having a specific pay-off date means there is some kind of plan in place and an end in sight. Without that date or plan, the debt can seem to be endless.

Bankruptcy can impact the home foreclosure process

For those in the midst of having a home foreclosed upon, finding a means of halting action or protecting credit may be of the utmost importance. While no one ever dreams of filing for bankruptcy, understanding the relationship between bankruptcy and home foreclosure is a must for those who are in need of immediate help. Florida homeowners may be surprised to learn just how filing for bankruptcy can provide a much needed reprieve while an individual or family fights to regain financial stability.

One immediate benefit to filing for bankruptcy is that it immediately stops the home foreclosure action. This does not mean home foreclosure is dropped or the action is stopped forever. But the halt in action may be all you need to regain some control and make a plan that can either save your home or decrease the damage to credit if a foreclosure moves forward.

Home foreclosure rates down across the country

The latest figures give both insight and hope for those concerned with home foreclosure rates in the United States. Just released data shows that home foreclosure rates are falling and going back to levels consistent with rates before the recession started. There are a number of reasons home foreclosure rates have stabilized even though Florida is still listed as a state with one of the highest rates for foreclosure.

One reason rates have stabilized and seem encouraging to homeowners is the fact that there are more jobs. Figures indicate there have been 3 million jobs created. This has helped many people keep up with mortgage payments and other financial obligations.

Minimum payment is not the way to go with credit card debt

When financial troubles hit, reducing credit card payments is often the first plan of attack to get back on track. Unfortunately, many people in Florida and elsewhere seem unaware that paying the minimum balance is essentially useless. In some circumstances, bankruptcy can be a smarter and economically sensible way to discharge credit card debt rather than treading water by making minimum payments.

According to new numbers, very few people actually realized just how pointless paying the minimum balance is in a few situations. For example, people were asked about the effectiveness of paying off a $2,000 credit card bill by means of only paying the minimum balance. The minimum payment would be $10 a month. When calculated correctly, it would take over 30 years to successfully pay off that credit card.

Home foreclosure action on zombie homes falls in Florida

Florida has ranked as one of the highest states in the nation when it comes to home foreclosure rates, including on homes that are dubbed "zombie" homes. The influx of homes in the midst of home foreclosure action has led to the increase in these so-called zombie homes. While these homes pose unique challenges and problems for both lenders and homeowners, the number of zombie homes in Florida has fallen recently.

According to the latest reports, the number of zombie homes fell by 46 percent. That number is a huge improvement over one year ago. As of the second quarter of 2015, there were 7,000 zombie homes in the midst of foreclosure. During the same quarter a year ago, that number was almost 15,300.

Bankruptcy to help David Cassidy not be behind on house payments

Serious financial woes can impact anyone from any type of background, even the rich and famous. Star of the 70's television show, The Partridge Family, David Cassidy has recently filed for bankruptcy, which has led to the need to auction off his Florida mansion. For those concerned with falling behind on house payments, following David Cassidy's lead may be the best option.

The mansion is set to be auctioned off for $1.9 million. The home has a gourmet kitchen, pool, six bedrooms and six bathrooms. It is 7,000 square feet and on the waterfront. The home was originally priced at $4.4 million.

Home price appreciation helps home foreclosure rates

For many families who struggled through the recession, avoiding home foreclosure was a priority. There is good news on the horizon for those in Florida who may still think bankruptcy is their best option but who also want to avoid home foreclosure in the process. That bright news is an increase in home values.

The appreciation in home values can mean a variety of things for homeowners. Mainly, homeowners who were underwater may not be anymore. This gives them more options once they have acquired a little equity in the home. If a homeowner files for bankruptcy, the discharging of other debts can help that homeowner stay current with a mortgage on a home that he or she could possibly sell rather than see lost to foreclosure.

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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