Bankruptcy and Foreclosure Attorney Blog

As advances in medical care continue to add years to the lives of many Americans, could the failure to plan for that longer life lead to bankruptcy?

It is currently estimated that nearly half of all Americans fail to plan properly for retirement.  Add to that a bruising economy that has seen the savings and retirement accounts of many older Americans drop as much as 40 percent, and the necessity for many of those to live off credit cards and you have the equivalent of the perfect storm.

The old paradigm of being able to retire at age 65 after a long career at one company with a comfortable pension and ample savings – with the house paid off and the kids long gone – has disappeared from the American landscape.

More older Americans are now saddled with debt, mortgages and may already have been drawing from their savings because they were laid off from their jobs.  The nest egg has turned rotten.

And even though it may go against some ingrained older attitudes, filing bankruptcy can be a great help to seniors, allowing them to shed the debt and reinvest freed income into savings and retirement accounts.  Bankruptcy may also prove to be an effective way to allow retirees to hold on to their homes.

Bankruptcy protects retirement accounts from creditors and will also discharge debt from medical bills, which is a higher percentage of the debt load for seniors.

If you need information on the Florida bankruptcy process, contact our Jacksonville, Florida bankruptcy law firm.

A Jacksonville bankruptcy attorney says a recent audit of individual Chapter 7 and Chapter 13 bankruptcy cases in the U.S. by the Executive Office of the U.S. Trustee has found that nearly one-fourth of those cases contained “material misstatements”.

What is a “material misstatement?”

The EOUST said “a material misstatement indicates the audit produced information that challenged the accuracy, veracity, or completeness of a debtor’s petition, schedules, or other filed bankruptcy documentation.  Inaccurate or incomplete information deprives the court, the United States Trustee, the private trustee, and creditors of adequate information to decide whether to conduct further investigation, recover assets, or seek or impose relief against the debtor.”

The EOUST is currently auditing one in 1,000 bankruptcy cases.  When a material misstatement is identified, the bankruptcy court and the creditors are notified.  So is there a growing trend of bankruptcy fraud?

It is hard to say, because the EOUST does not specifically define what constitutes a material misstatement.  It could be deliberate fraudulent behavior by debtors, or it could be a clerical error in filling out the proper forms.

If you are considering filing bankruptcy in Florida, consulting with a Florida bankruptcy attorney will ensure that all your documentation is prepared properly and that your case will stand up to any audit scrutiny.  Going it alone may cost you in the long term.

To fully understand what you need to know about filing bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

With creditors blocking a proposed sale, the MLB franchise Texas Rangers took the unusual step of filing for Chapter 11 bankruptcy in an effort to force a sale to Pittsburgh investor Chuck Greenberg and former Ranger pitcher and Hall of Famer Nolan Ryan.

Current Rangers’ owner Tom Hicks is divesting himself of all his sports teams – the Rangers, the Dallas Stars NHL team and British soccer team Liverpool FC.   Rangers’ creditors had been blocking the sale of the MLB team to the Greenberg-Ryan group, saying the purchase price would not provide them with fair compensation for the Rangers’ estimated $525 million loan debt.

Hicks told the Dallas Morning News that, “the creditors seriously misjudge how professional sports work.  It's a club. It's a club that 75 percent of the people have to decide they want to admit somebody into. It can't be forced to be sold to the highest bidder."

The team has asked the bankruptcy court for a “prepackaged bankruptcy” to speed the sale, which they hope to complete prior to the July 31 player trading deadline.

If you have a business that needs protection from creditors and want more information about filing Florida Chapter 11 bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

As part of the foreclosure process in Florida, all primary residences are automatically sent into mediation.

Florida is currently averaging over 350,000 foreclosures annually.  Last December, the state Supreme Court issued an administrative order to all 20 circuit courts to implement a mandatory mediation program in hopes of keeping more foreclosures off the court’s docket.

Unfortunately, the state’s budget has not kept pace with the need for more judicial staff, and Florida foreclosure mediators are just as overburdened with casework as the circuit court judges.

However, the good thing about Florida’s foreclosure mediation mandate is that it forces lenders to the table to negotiate in good faith with borrowers.  The lender must bring all the relevant documents to the mediation session, including an itemization of what must be paid to catch up and pay off the loan.

According to a recent article in USA Today, the 18^th Circuit Court in Brevard County has sent 317 cases to mediation and 59 of those have received a modified loan payment plan, thus staving off foreclosure.

If you are a Jacksonville homeowner who needs to know more about the Florida foreclosure laws, contact our Jacksonville, Florida foreclosure law firm.

Included in the House and Senate versions of the new financial overhaul legislation are measures designed to halt the manipulative lending practices that enticed consumers into getting loans they could not afford and led to the current foreclosure crisis.

The legislation, which is scheduled to be signed by President Obama sometime this summer, has provisions that hold lenders responsible for the loans they approve, change the way loan officers are compensated, require lenders to give mortgages only to those who prove they can repay them, and limit the penalties that lenders can charge for those who pay off their mortgages early.

Analysts say the subprime mortgage crisis was largely brought about by lenders who evaluated only the borrower’s ability to make payments based on a low “teaser” rate.  Once those rates ballooned, borrowers could no longer pay their mortgages and their homes fell into foreclosure.  The new legislation would make it mandatory for lenders to assess a borrower’s ability to pay for the first five years of the loan term before approving a mortgage application.

In addition, the legislation outlaws the extra compensation for loan officers and mortgage brokers who were rewarded for putting borrowers into loans with a higher interest rate than they qualified for.

If you are a Florida homeowner facing possible foreclosure and need help, contact our Jacksonville, Florida foreclosure law firm.

A recent article at CNNMoney.com said that a growing number of U.S. homes are being sold through private auction rather than through realtors in an effort to sell more quickly and avoid foreclosure.

According to the National Auctioneers Association, auction sales in the first three months of this year increased 14% over 2009.  In some areas of the country, auction houses report a 50 percent jump in activity.

One real estate auction company executive said that the entire process, from first listing to closing, can take as little as 10 weeks.

Auctions are held onsite at the home, making it available for personal inspection by potential buyers.  All auction properties are sold “as-is,” and buyers must pay immediately via money order or cashier’s check.

Banks are also turning to auctions for REO sales, lured by the speed of the process.  Even developers have used auctions to move slow-moving inventory.

Auction industry insiders say that homeowners who have tried to sell their property through traditional methods find the auction process a welcome relief, since the sales are conducted quickly and cleanly without having to dicker with potential buyers and their agents over fixes and price.

If you are facing a foreclosure in Florida and need help, contact our Jacksonville, Florida foreclosure law firm.

The recent decline in both residential and commercial property values, spurred by the rapid rise in Jacksonville foreclosures, has led to a drop in taxable property values in Duval County, which means less money for area schools and the City of Jacksonville.

According to the Duval County Property Appraiser, Duval County taxable property values have dropped five percent in 2010 from 2009 values.  The estimate for 2010 is $55.4 billion, down from $58.4 billion last year.

While the drop in property value saves taxpayers money in the short term, it leaves local governmental entities with “less to do more,” which increases the likelihood of a property tax rate hike to make up the shortfall.

Last year, the millage rate for Duval County and Jacksonville increased from 16.4954 to 17.3050, according to the Duval County Property Appraiser’s Office.

On a positive note, the Duval County Appraiser’s Office said that the county’s real estate base is more diverse than other areas of the state where the majority of the taxable property base is residential.  When foreclosures ease and the market begins to rebound, Duval County is expected to see a quicker restoration to increases in its taxable property base.

If you are a Jacksonville homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

One Jacksonville bankruptcy attorney says that small businesses that file Chapter 11 bankruptcy may actually be doing the best thing to save their business in the long run.

For a small business in trouble, filing Chapter 11 bankruptcy can mean:

Access to new capital. If a small business still has a viable market and business plan, there are lenders that will invest in a Chapter 11 bankruptcy business, which allows the business to continue operations as it restructures its debt.

Halting creditors’ seizure of assets. When a business is in Chapter 11 bankruptcy, creditors are not allowed to pursue collections against the company.  This provides the necessary protection for the business to continue to utilize its assets and continue to do business.

Time to restructure. Businesses in trouble need time to figure things out.  Chapter 11 bankruptcy provides this necessary “breathing room” for businesses to reexamine their operations and restructure for the future without the distraction of legal threats from creditors.

If you own a small business that has been gravely injured by economic conditions and you are looking for a way to continue to operate now that the economy shows signs of recovery, you may want to consider a Chapter 11 bankruptcy filing.

If you need to information on filing Florida Chapter 11 bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

This is a question that many Florida residents have when filing bankruptcy or when faced with a former spouse that is filing bankruptcy. Generally the answer is no. According to the Bankruptcy Code 11 U.S.C. §523(a)(5), a discharge does not relieve the debtor of a domestic support obligation. This prevents former spouse debtors from discharging their obligations to pay things such as child support, alimony, and maintenance to the other spouse.

However, the debts that qualify under the definition of support for purposes of the bankruptcy code may not be easily identifiable. Under Florida law the courts require a divorcing couple to equitably distribute all of their assets and debts amongst each other. What happens when one spouse is ordered to pay a lump sum to the other spouse as part of an equitable distribution? Can a former spouse discharge their obligation to pay a divorce award to the other spouse?

The answer depends on nature of the obligation and the intent at the time of its creation according to the court in Cummings v. Cummings 244 F.3d 1263. In that case the court stated that a domestic obligation can be deemed “actually in the nature of support” even if it is not considered “support” under state law. The important thing to take away from this case is that a portion of an equitable distribution or all of it may be considered “in the nature of support” and non-dischargeable depending on the intention of the court at the time the award was made. On the other hand, you may be able to discharge a divorce award if it was not intended as support to the other spouse.

If you have questions about Bankruptcy call a Jacksonville Bankruptcy Attorney for guidance.

Personal bankruptcy filings were at an all-time high in the Jacksonville area last month, and one Jacksonville bankruptcy attorney says it is no surprise due to the high consumer debt average carried by Jacksonville residents.

Data recently released by credit reporting company Experian Information Solutions, Inc., showed that the average credit card and auto loan debt per consumer in Jacksonville is $25,696.

On a list of the Top 20 major metropolitan areas, that would place Jacksonville at #6.  Seattle was at #1 with $26,646 average debt per consumer; other Florida cities included Tampa (#8), Orlando (#10) and Miami (#19).

Credit card debt is one of the leading contributors to filing a Chapter 7 or Chapter 13 bankruptcy, both of which wipe out credit card debt.  Since auto loan debt is secured debt – which means it is backed up by an asset (in this case, the car) – it is not dischargeable in bankruptcy.  However, if you can work out a way to keep making payments – which consumers can usually do once other debt is eliminated – you can continue to keep your car.

If you are considering filing a Florida bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

While the airwaves continue to be full of promises of tax debt relief through bankruptcy, one Jacksonville bankruptcy attorney says that while some taxes can be eliminated, most cannot.

If you file Chapter 7 bankruptcy, your tax debts can be discharged, but only if you qualify.

In order to qualify, you must meet all of the following conditions:

• Your taxes are income taxes


• You did not commit fraud or willful evasion


• The tax debt is at least three years old


• You filed a tax return for the debt you wish to discharge at least two years before filing bankruptcy


• The IRS must have assessed your income tax debt at least 240 days before you filed bankruptcy, or it must not have been assessed yet.

Under Chapter 7, a federal tax lien cannot be discharged, so if the IRS has recorded a tax lien on your property, you will have to pay it off prior to selling the property.

If you file Chapter 13 bankruptcy, you will still have to repay your taxes in full as part of a court-appointment payment plan.

If you have questions about filing bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

According to a report out last week by credit reporting agency TransUnion, Florida had the highest private student loan delinquency rate in the nation during 2009:

The highest private student loan delinquency rates, defined as 90 days or more past due, were in Florida (9.44 percent), Mississippi (9.09 percent) and Tennessee (9.07 percent). The lowest delinquency rates were found in Vermont (3.28 percent), New Hampshire (3.60 percent) and North Dakota (3.75 percent). Areas showing the greatest percentage drop in delinquency from the previous quarter were Mississippi (-14.45 percent), Alabama (-12.41 percent) and Kentucky
(-10.84 percent).

Thirty-day student loan delinquency rates experienced a 6.6 percent drop, down from a high of 8.06 percent in 3Q 2009. However, year-over-year for the fourth quarter, the 30- and 90-day delinquency rates are up from 2008 (10.4 percent and 11.67 percent, respectively) and from 2007 (16.93 percent and 15.52 percent, respectively).

TransUnion attributed the increase in private student loan delinquency to:

• Under- or unemployed workers seeking new degrees


• Continued depressed home valuations that have limited the use of home equity loans to fund education


• Increased awareness by students that government loans are a better funding vehicle than private loans

If you have student loan debt and want to know if a Florida bankruptcy filing is an option, contact our Jacksonville, Florida bankruptcy law firm.

A comment made in response to a recent Florida Times-Union article on the record number of bankruptcy filings in Jacksonville shows that some consumers are embracing bankruptcy as a viable solution to resolving their personal debt crises:

I filed back in October. I dumped my upside down house and $20k worth of credit cards. If I was going to do it, I was going to do it right. All in all I'm saving about $400,000 over the 12 years it would have taken to recoup the value of my house and get the cards paid off.

It was a financial move, and a good one at that. With all of the free cash I have now I've maxed out my 401k and HSA savings ($19,500 a year), looking towards the future. The only loan I kept was my car loan, which I'm paying extra on now and will have paid off a few years earlier, then all of that cash will go straight to savings too until the car blows up and I need a new (used) one.

This economy is very unstable and its best to have as much cold hard cash as you can have on hand. Bankruptcy can be a very good eye opener and valuable tool. You just have to use it right and then learn to live within your means.

Credit card offers come 6 months after discharge, mortgage offers come 2 years after discharge. If it concerns you that much, and if you can play the game right you can have a 700+ score a year or so after discharge.

Me, I've learned my credit lesson. No more getting suckered by the Credit Industry, I can do without. Now I have a rented condo at the beach and enough disposable income to plan for the future and live comfortably & humbly in the present.

If you need to information on how bankruptcy can help you get out of debt, contact our Jacksonville, Florida bankruptcy law firm.

The Sports Business Journal has reported that Major League Baseball may seize the Texas Rangers soon in an effort to stop the team’s creditors from pushing the franchise into bankruptcy:

MLB as soon as this week plans to dramatically alter the course of the standoff between creditors and the owner of the Texas Rangers, multiple sources said last week, a development that could include the league seizing the franchise.

Were the league to seize the team under its “best interests of baseball” rule, MLB could sell the club to the group led by Chuck Greenberg and Nolan Ryan without, the league believes, the creditors blocking the deal, these sources said. But were MLB to choose that course — and late last week, the situation was still fluid — financial sources predicted a furious legal response from the creditors that could involve an involuntary bankruptcy petition on behalf of the baseball team.

The coming developments, whether franchise seizure or another course of action MLB could be considering, may bring to a climax a bitter 3 1/2-month process that started with the January agreement between Greenberg and Hicks Sports Group (HSG), which owns the team. Many of the sources said they believe MLB’s only option is franchise seizure if it wants to break the logjam, while others stressed that no firm decision had been made.

HSG put the team up for sale after defaulting on $525 million of debt in March 2009, so the creditors have the right to block the sale — which they have done out of dissatisfaction with the proceeds that would flow to them from the proposed Greenberg purchase.

Despite arduous negotiations between HSG and the creditors, with MLB acting as an intermediary, there is a stalemate. Representatives of MLB and HSG did meet last week, sources said, but no talks occurred with the creditors.

If you need more information on the impact of a bankruptcy filing, contact our Jacksonville, Florida bankruptcy law firm.

According to a recent report by Barclays Capital, there could be more than 4.5 million homes in “shadow inventory” – ready to be sold, but not yet on the market.  And if this proves to be the case, some housing market experts say it could deepen the foreclosure crisis.

A CNN Money report noted:

This so-called shadow inventory is a recent phenomenon. In the past, inventory was either tight or it wasn't. But now, with home prices so low and so many foreclosures on the market, both homeowners and banks have been waiting to put properties on the market.

"These sidelined sellers closely watch the market for signs of a possible turnaround and rush in if there's a hint of good news," said Leslie Appleton-Young, chief economist for the California Association of Realtors.

But as more sellers put their homes up for sale, supplies increase, which will depress prices again. Rinse and repeat ad infinitum.

That vicious cycle could cause prices to bounce up and down for years. "I see a saw tooth bottom," Humphries said. "Prices go up; inventory rises, which sends prices down again. That plays out for three to five years of no appreciation. ... Without price appreciation, it leaves more homeowners in negative equity. That's toxic. Any setback, like a job loss, they go into foreclosure."

If you are a Florida homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

A Harris Interactive online survey commissioned by RealtyTrac and Trulia.com shows that Americans are more reluctant to buy a foreclosed home than one year ago.

From the report:

The new online survey conducted on their behalf from May 10-12, 2010 by Harris Interactive® showed a notable decrease in consumers’ willingness to buy foreclosed properties compared to one year ago. Currently, 45 percent of U.S. adults age 18 and above are at least somewhat likely to consider purchasing a foreclosed home in the future, compared to the 55 percent of U.S. adults age 18 and above surveyed online by Harris Interactive® between May 1-5, 2009.

Only 1 percent of homeowners with a mortgage say walking away from their home would be their first choice if they were unable to pay their mortgage.  If their mortgage were to go “underwater,” 41 percent would at least consider walking away, while 59 percent would not consider walking away no matter how much their mortgage was underwater.

“Although fewer consumers expressed interest in buying a foreclosed home than a year ago, the actual sales of bank-owned properties (REOs), along with sales of properties in the foreclosure process, continue to increase — accounting for more than 30 percent of total sales in the first quarter of 2010 according to our data,” said Rick Sharga, senior vice president for RealtyTrac. “We anticipate that there will be an increased number of both REO purchases and short sales throughout the rest of the year as the most active buying segments – first time home buyers and investors – continue to look for bargains.”

“It appears that potential homebuyers are taking a more realistic view of foreclosure purchasing,” Sharga continued. “Buying a foreclosure property still provides an opportunity for dramatic savings on a home, but the time and effort involved in executing a short sale, bidding against other buyers for an REO, or the need to do renovations may be issues for buyers not as focused on getting the best price.”

If you need more information regarding Florida homeowner rights, contact our Jacksonville, Florida foreclosure law firm.

The governor of Maryland signed into law this week a bill that creates a foreclosure mediation program to help distressed homeowners stay in their homes.

The new legislation gives Maryland homeowners facing foreclosure the right to mediate with their lenders as part of the foreclosure process.

From the Washington Post report:

"With my signature today, we are empowering our fellow Marylanders, putting them on a more equal footing with mortgage companies that too often can't be bothered to pick up the phone before beginning a foreclosure proceeding," O'Malley said in a statement. "This legislation will help keep more Marylanders in the homes they worked hard to purchase."

Under the bill, the lender is required to send an application for a loan-modification or loss-mitigation program to the homeowner at least 45 days before a foreclosure action is filed in court. It is also mandated that the lender pay a $300 fee for a foreclosure filing.

The homeowner has 15 days after receiving the lender's final loss-mitigation affidavit, which states reasons for denial of a loan modification, to request a foreclosure mediation. The request must be sent to the Circuit Court, along with a $50 fee.

A work group organized by O'Malley last year initially considered a mandatory mediation program. But the bill instead allows homeowners to opt in.

The mediation program is O'Malley's latest effort to help homeowners stave off foreclosure.

In 2008, O'Malley proposed bills that extended the foreclosure timetable from 15 to 150 days, prohibited prepayment penalties and made egregious mortgage schemes subject to criminal prosecution.

If you need help in defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

HUD has announced that another $1 billion in federal funds will be made available to purchase and renovate abandoned homes in areas hardest hit by the foreclosure crisis.  Most of the money is likely to go to Florida, California, Arizona and Nevada.

According to a report at the Huffington Post, HUD Secretary Shaun Donovan made the announcement at a media breakfast earlier this week:

Most of the money will go to benefit states such as Nevada, California, Florida and Arizona, which have been most affected by the housing crisis, providing them with funding to purchase and rehabilitate vacant homes.

The reallocated money could help Las Vegas more than any other single city, Donovan noted.

But there's evidence that the country has too many houses on the market already, the fallout of over-zealous construction during the boom years. In Las Vegas, for instance, there are 9,517 new homes sitting empty and in the first quarter alone 5,600 homes were repossessed by lenders, according to recent reporting in the New York Times. Donovan responded to this directly: "We have seen substantial improvements in many badly depressed markets... I wouldn't say Las Vegas is a good example of what's happening around the country."

Renovating and reselling houses is only a fraction of what officials aim to do with the incoming money. The administration will work with Congress on HUD's Neighborhood Stabilization Program, with additional dollars for foreclosure prevention counseling. In places like Cleveland and Detroit, Donovan is planning what he called a fundamental rethinking of land use.

"What was encouraging [in Detroit]," says Donovan, reflecting on his trip to the city last month, "was that Mayor Bing is thinking strategically." Outside-the-box initiatives include a commitment to building better public transportation, in particular a new streetcar line and maybe a commitment to rural farming.

If you are a Florida homeowner facing possible foreclosure, contact our Jacksonville, Florida foreclosure law firm.

The Florida Attorney General’s office is investigating Jacksonville-based Lender Processing Services and Fidelity National Financial for allegedly forging foreclosure lawsuit documentation.

From the Florida Times-Union:

Lawyers fighting foreclosures have questioned the authenticity of some assignment paperwork prepared by Docx.

Court files have given them some extra ammunition.

At least 10 times since 2008, Docx assignments have been filed in Florida courthouses naming the new owner of the mortgage only as “BOGUS ASSIGNEE FOR INTERVENING ASMTS [assignments],” court records show.

On at least three assignments, the initial owner of the mortgage is listed as “A BAD BENE” — seemingly, for a false beneficiary.

Those forms were filed in Duval, Nassau, Volusia, Lee, Orange, Pasco and St. Lucie counties.

Lender Processing spokeswoman Michelle Kersch said Bogus Assignee and Bad Bene were placeholder names in a computerized form the company uses, and should have been replaced with specific information about that mortgage.

She said Docx has no idea whether documents are being used in foreclosure suits. She said the company simply enters information into a standard form and "has no independent discretion concerning the timing of the preparation of the document nor the information contained."

Kersch said Docx began preparing mortgage assignments in 2008 and stopped last year.

For more information on your rights as a homeowner in the Florida foreclosure process, contact our Jacksonville, Florida foreclosure law firm.

The new U.S. Attorney General for the Southern District of Florida says that one of his top priorities will be fighting mortgage fraud.

U.S. Attorney Wilfredo Ferrer said, "There is rampant fraud in South Florida.  I think that's unfortunate. It is embarrassing that we are known in some circles as the fraud capital of the country. I don't like that title."

From therealdeal.com:

Ferrer announced that Joan Silverstein has been named the chief of the division of economic and environmental crimes, which includes mortgage fraud cases.

"Lucky for me, we've got a great economic crimes section here to handle our fraud prosecutions. When it comes to real estate, housing discrimination, mortgage fraud cases, we're leading the nation [in prosecutions]. That's a good thing but it's also a bad thing because it shows we have a lot of fraud here."

Just last month, Homestead mortgage broker Yvette Valdes was indicted by a federal grand jury, charged with falsifying loan documents on two properties in Southwest Miami-Dade County. She faces up to 30 years in prison.

For more information on how to protect yourself against possible foreclosure, contact our Jacksonville, Florida foreclosure law firm.

The Wall Street Journal has reported that one in four homeowners participating in the federal government’s mortgage modification program are dropped after their trial modifications because of their continued inability to pay or failure to meet other qualifications.

From the article:

Homeowners are first offered trial modifications under the program, which provides incentive payments to loan servicers, investors and the homeowners. If borrowers make the payments and satisfy other criteria, those trials are made permanent, ensuring a cut in payments for five years.

While awaiting answers, some borrowers keep making payments, exhausting their savings in what may be a futile effort to save their homes. They also incur fees from the banks and delay taking action that might give them a fresh start in a more affordable home.

Some borrowers had unrealistic expectations about loan-relief programs, which were never designed to prevent all foreclosures. Another big problem is that banks often take six to 12 months to determine whether applicants are eligible.

Eager for quick results, the Obama administration last year prodded banks to start people on trials without first obtaining documents proving they were eligible. That has led to many crushed hopes. The Treasury earlier this year changed its rules and told banks to start trials only after getting documents that proved borrowers qualified.

The Treasury said in a monthly report on the government's $50 billion Home Affordable Modification Program, or HAMP, that about 1.2 million trial modifications had been started under the plan, and about 281,000 borrowers had washed out by the end of April.

If you are a Florida homeowner facing possible foreclosure and need to know your options for defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

A University of Arizona study released earlier this month says that many of the homeowners who are defaulting on their mortgages are doing so out of fear, anger or despair rather than making the decision based on their best financial interests.

From an article at wsj.com:

Though small—covering just 350 people—the study spotted a notable trend. Some of these people have stopped paying because they are anxious about their financial situation; others are furious that banks or the government won't help ease their load while other people are getting assistance. Hopelessness is a factor for others.

Brent White, an associate professor of law at the University of Arizona who ran the study, focused on "strategic defaults" in which a borrower who could afford to keep paying opted not to do so. That phenomenon is frequently described as a rational response by homeowners who are "underwater," owing far more than the current values of their homes.

But that isn't always the case. It depends on the cost of alternative housing and on future home-price movements, which are hard to predict. Also uncertain is how many years a borrower may need to repair a credit rating and whether the lender may try to collect any amount by which foreclosure-sale proceeds fall short of the loan balance.

Strategic defaults are becoming more common, various studies show—a Morgan Stanley report pegged them at 12% of all home-mortgage defaults in February, up from "insignificant levels" three years ago. Lenders fear borrowers who "walk away" will greatly increase the industry's foreclosure-related losses, which already total in the hundreds of billions of dollars.

If you are a Florida homeowner facing possible foreclosure and need to know about all your legal options, contact our Jacksonville, Florida foreclosure law firm.

A Jacksonville foreclosure attorney noted that the latest mortgage delinquencies report out from the Mortgage Bankers Association shows that more than 10 percent of Americans are delinquent on their mortgages and 4.6 percent were in foreclosure.

From the Associated Press coverage of the MBA report:

The number of homeowners who missed at least one mortgage payment surged to a record in the first quarter of the year, a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners had missed at least one mortgage payment in the January-March period, the Mortgage Bankers Association said Wednesday. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier.

More than 4.6 percent of homeowners were in foreclosure, also a record. But that number, which is not adjusted for seasonal factors, was up only slightly from the end of last year.

Jay Brinkmann, the trade group's chief economist, said the foreclosure crisis appears to have stabilized. Seasonal adjustments may be exaggerating the change from the previous quarter, he added.

"I don't see signs now that it's getting worse, but it's going to take a while," he said. "A bad situation that's not getting worse is still bad."

The number of American homeowners who have missed at least three months of payments or are in foreclosure has surged to around 4.3 million, Brinkmann estimated.

The Obama administration's $75 billion foreclosure prevention program has barely dented the problem. More than 299,000 homeowners had received permanent loan modifications as of last month. That's about 25 percent of the 1.2 million who started the program since its March 2009 launch.

About 277,000 homeowners, or 23 percent of those enrolled, have dropped out during a trial phase that lasts at least three months.



If you are a Jacksonville homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

The Wall Street Journal has reported on comments made by the SEC’s chief bankruptcy counsel that the agency may be taking a closer look at Chapter 11 cases and the reorganization plans that result from them:

The SEC has traditionally looked at issues of corporate fraud and proper disclosure in bankruptcy cases, but it’s now forced to take a wider view in light of historic Chapter 11 filings such as those of General Motors and Lehman Brothers, SEC attorney Alistaire Bambach said at the American Bankruptcy Institute’s spring meeting outside Washington, D.C.

“Dealing with the era of too big to fail and bailouts, we spend more time reviewing plan proposals than we ever had in the recent past,” she said “You might not see us, but we are in there longer than you might expect.”

Bambach cautioned that she was speaking for herself and not necessarily representing the agency’s views.

Fast-moving Chapter 11 sales are of particular concern to the SEC, she said. In the past six months, three of the four companies that were publicly traded when they entered Chapter 11 exited by means of a sale rather than a traditional plan process, Bambach said.

Economic conditions often necessitate quick sales, but protecting creditors’ and investors’ rights must also be on the mind of regulators, she said.

“You want to make sure the ability for other parties to bid and the ability to generate value is not destroyed,” Bambach said.

From an enforcement prospective, Bambach said the SEC is carefully looking at unsecured creditors committees. She said the agency is currently prosecuting a case in which an unsecured creditor allegedly made trades based on information obtained from his position on the committee.

“The danger of potential insider trading is something we are very conscious of in these cases,” Bambach said.

If you are considering filing Chapter 11 bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

Personal bankruptcies continue to rise in the Jacksonville area and one Jacksonville bankruptcy lawyer says there are common behaviors that are signposts on the road to bankruptcy:

Poor Financial Planning – failing to track monthly expenses and operate without a budget leaves many people strapped for cash every month.  They eventually fall prey to insolvency.

Too Much House – many Floridians are feeling the pain of their decision to take advantage of the easy credit that was available several years ago to buy more home than they could afford.  Mortgage payments that are too large are one of the major factors in personal bankruptcy filings.

Too Much Credit Card Debt – ditto here for the easy credit trap.  Add to that the fact that many consumers finance their lifestyle with credit cards and you have a recipe for financial disaster.

No Emergency Fund – another leading cause of bankruptcies is unplanned expenses.  Coping with a job loss, medical bills or major home repairs without an emergency fund to fall back on often pushes consumers into bankruptcy.

Tax Problems – failing to pay personal or business taxes also forces some people into filing bankruptcy.  And unfortunately, most taxes are not dischargeable in bankruptcy.

To fully understand what you need to know about filing bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

The first decade of the 21^st century is already in the books as “the business bankruptcy decade”, in the opinion of one Jacksonville bankruptcy attorney.

According to BankruptcyData.com, 17 of the 20 largest business bankruptcies of all time happened between 2001-2009.  The majority (9) were in the financial services sector, followed by energy (3), automotive (2), telecommunications (2) and industrial (1).

From largest on down, the seventeen 21^st century business bankruptcies include:

1. Lehman Brothers


2. Washington Mutual


3. WorldCom


4. General Motors Corp.


5. CIT Group Inc.


6. Enron Corp.


7. Conseco, Inc.


8. Chrysler LLC


9. Thornburg Mortgage, Inc.


10. Pacific Gas and Electric Co.


11. Refco, Inc.


12. IndyMac Bancorp, Inc.


13. Global Crossing Ltd.


14. General Growth Properties, Inc.


15. Lyondell Chemical Co.


16. Calpine Corp.


17. New Century Financial Corp.

Consequently, the first decade of the 21^st century was also the most lucrative for bankruptcy attorneys and consultants.  According to a recent New York Times article:

The lawyers, accountants and restructuring experts overseeing the remains of Lehman Brothers have already racked up more than $730 million in fees and expenses, with no end in sight.

These megacases — Lehman, General Motors, Chrysler and Washington Mutual, to name a few — are orders of magnitude larger than most bankruptcies in the past, and their size and complexity have created a feeding frenzy of sorts for those asked to sort them out. To date, Weil, the lead law firm representing Lehman, has billed the Lehman estate for more than $164 million.

Think the lawyers are expensive? Meet the consultants. Alvarez & Marsal, a turnaround firm that is essentially running what remains of Lehman, has billed more than $262.1 million.

Many people in the industry agree that Lehman, in particular, is a huge case that tests even the most experienced lawyers. “Lehman is a sufficiently complicated company that it would be safe to assume that if it weren’t for equally sophisticated professionals running the Chapter 11 case, that the creditors would essentially receive nothing,” says Stephen J. Lubben, a professor at the Seton Hall University School of Law. “In those situations, it makes sense for sophisticated professionals to handle the case.”

If you need information on the Florida business bankruptcy process, contact our Jacksonville, Florida bankruptcy law firm.

Investors who trade in distressed debt are balking at possible new disclosure rules that would force them to disclose more information about themselves.

From a recent post on the Wall Street Journal’s website:

Distressed-debt investors are fighting an uphill battle right now against new disclosure rules that would shine more light on their trading activity in bankruptcy cases, and if they’re looking for advocates among judges, they’re increasingly out of luck.

U.S. Bankruptcy Judge Robert Gerber, who has overseen some of the most high-profile bankruptcies in recent memory, has been outspoken on the proposed change, calling for broader disclosure rules that would force investors to divulge information they jealously guard.

On Wednesday, a group of his peers weighed in on the controversy, telling a group of lawyers and financial advisers to troubled companies that they, too, back the proposed changes when investor groups want to play a role in a bankruptcy case.

“If you want to come into bankruptcy court, you to tell us who you are,” said Kevin Carey, the chief judge for the Delaware bankruptcy court, one of the most prominent bankruptcy forums in the country. “The judge can’t be kept totally in the dark.”

Carey, joined by three other bankruptcy judges, spoke at the Turnaround Management Association’s spring conference in New York, where they debated several of the hottest issues in bankruptcy today, including the increasingly aggressive tactics used by creditor groups wrangling for bigger recoveries.

On that front, at least, distressed investors who want to take an active role in bankruptcy cases have some friends on the judges’ panel.

“I think that aggressiveness is good,” Rosemary Gambardella, a New Jersey bankruptcy judge. “I think that aggressiveness pays out in the end.”

If you need to information on filing Florida bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

The American Bankruptcy Institute reported last week that U.S. consumer bankruptcy filings rose 15 percent in April from the same month one year ago – although total consumer bankruptcy filings were actually down 3 percent from last month:

The 144,490 consumer bankruptcies filed in April represented a 15 percent increase nationwide over the 125,618 filings recorded in April 2009, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). NBKRC’s data also showed that the April consumer filings represented a 3 percent decrease from the 149,268 consumer filings recorded in March 2010. Chapter 13 filings constituted 25 percent of all consumer cases in April, remaining unchanged from March.

“As Congress continues to consider measures to protect and assist consumers, bankruptcy is still the last resort for families coping with unemployment and increasing debt loads,” said ABI Executive Director Samuel J. Gerdano. “Consumer filings this year will likely surpass 1.5 million filings.”

If you have recently suffered a job loss or are having problems paying your bills and need more information about filing Florida bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

Jacksonville area bankruptcy filings rose 18 percent for the first four months of 2010 compared to last year with Chapter 7 liquidation filings dominating the docket, according to a report from the Jacksonville Daily Record:

In the U.S. Middle District of Florida, Chapter 7 liquidations dominate the docket, accounting for 75 percent of all bankruptcy filings in the district, which covers the major metro areas of Jacksonville, Orlando and Tampa.

Chapter 7 is a liquidation of assets. Debtors can keep some exempt property, while the remainder is liquidated and distributed to creditors.

With Northeast Florida’s unemployment rate hovering at 12 percent and job creation remaining slow, bankruptcies are expected to continue.

The U.S. Bankruptcy Court for Florida’s Middle District contains about 10 million of Florida’s 18 million residents, according to the court.

It contains 35 of the state’s 67 counties, including several of the state’s largest metro areas, including Jacksonville, Tampa Bay, Orlando, Ocala, Daytona and Fort Myers.

Districtwide:

• Total bankruptcy filings spiked 18 percent during the first four months, compared to last year, and were five times the pace of 2006.

• Chapter 7 liquidation filings rose 21 percent over the year to 16,659, seven times the rate of 2006.

• Chapter 13 individual repayment plans rose 7 percent to 5,293, three times the rate of 2006.

• Chapter 11 corporate reorganizations almost doubled over the year to 316 and were nine times the rate of 2006.

In the district’s Jacksonville division, overall bankruptcy filings, including all chapters, rose almost 8 percent over last year, following a first-quarter rise of 10 percent.

Filings in the Jacksonville division rose to 3,822 in the first four months, the highest since 2005, before bankruptcy laws were changed to make it harder to file.

The filings were three times the pace of the same period in 2006, before the recession began.

If you are considering filing a Jacksonville bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

Under Florida bankruptcy law, there are certain assets that a debtor can keep.  These assets are known as exempt – or excluded – property, and are determined based upon a debtor’s personal income and circumstances.

Qualifying exemptions for Florida include:

Homestead – real or personal property including a primary residence, mobile home, modular home or condominium.

Personal Property – includes a motor vehicle to $1,000, any personal property to $1,000 ($2,000 for married couple), federal income tax refunds or tax credits, health aids, prepaid medical savings account deposits, prepaid college education trust deposits and prepaid hurricane savings accounts.

Pensions – includes tax-exempt retirement accounts, tradition and ROTH IRAs to $1 million per person, public benefits, veterans’ benefits, workers’ compensation and more.

Wages – includes all wages for heads of family up to $500 per week, deposited into a bank account for up to six months.

Insurance – includes disability or illness benefits, death benefits payable to a designated beneficiary, life insurance cash surrender value, annuities and fraternal society benefits.

To fully understand what you may or may not be able to keep if you file Chapter 7 or Chapter 13 bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

According to a report out last week by the U.S. Government Accountability Office on the results of an investigation of the debt settlement industry:

GAO's investigation found that some debt settlement companies engage in fraudulent, deceptive, and abusive practices that pose a risk to consumers. Seventeen of the 20 companies GAO called while posing as fictitious consumers say they collect fees before settling consumer debts--a practice FTC has labeled as harmful and proposed banning--while only 1 company said it collects most fees after it successfully settles consumer debt. (GAO was unable to obtain fee information from 2 companies.)

In several cases, companies stated that monthly payments would go entirely to fees for up to 4 months before any money would be reserved to settle consumer debt. Nearly all of the companies advised GAO's fictitious consumers to stop paying their creditors, including accounts that were still current.

GAO also found that some debt settlement companies provided fraudulent, deceptive, or questionable information to its fictitious consumers, such as claiming unusually high success rates for their programs--as high as 100 percent. FTC and state investigations have typically found that less than 10 percent of consumers successfully complete these programs.

If you have questions about debt settlement options -- including bankruptcy -- in Florida, contact our Jacksonville, Florida bankruptcy law firm.

Florida poker professional Michael Mizrachi has $6.9 million in career winnings, but today he is in debt and facing foreclosure due to poor money management.

A Palm Beach Post News article said:

South Florida poker superstar Michael Mizrachi, with $6.9 million career winnings, owes almost $340,000 in federal taxes and is facing foreclosure.

Mizrachi, 29, who had a record-breaking 2005 World Series of Poker, has been hit with a $339,711 lien from the IRS, records show. A Hollywood condo he owned with his brother, Robert Mizrachi, was foreclosed on and sold via an online auction on Wednesday. His Miramar home was foreclosed on in March, and is up for sale next week, according to court records.

The debts come from mismanagement of poker winnings, said Mizrachi, who said he fired his accountant and "hired a better one."

"They were doing a bad job," he said. "I'm working on (settling the liens)."

Known as "The Grinder," Mizrachi had the hot hand in 2005, winning a World Poker Tour event that paid $1.85 million and tying a World Series of Poker record with seven in-the-money finishes. The next year he won another poker tournament worth $1.1 million and had enough other tournament success to be named CardPlayer Magazine’s 2006 player of the year. But in 2009 he won only about $325,000 in tournaments and has cashed only once in 2010, for $7,465. The federal tax lien is for earnings from 2005-07.

If you are a Jacksonville homeowner who needs to know more about the Florida foreclosure laws, contact our Jacksonville, Florida foreclosure law firm.

The latest housing statistics from Florida Realtors shows that sales of existing single-family homes rose 24 percent and existing condo sales were up 67 percent in the first quarter of 2010 compared to the same period one year ago.

From the report:

A total of 38,846 existing homes sold statewide in 1Q 2010; during the same period the year before, a total of 31,410 existing homes sold. It marks the seventh consecutive quarter that Florida has seen higher existing year-to-year home sales, according to the state association.

Statewide sales of existing condominiums in the first quarter rose 67 percent compared to the same time the previous year. This marks the sixth consecutive quarter for increased statewide sales in both the existing home and condo markets compared to year-ago levels.

“The first quarter data release from the Florida Realtors paints a picture of a housing market continuing down the long road to recovery,” said Dr. Sean Snaith, director for the University of Central Florida’s Institute for Economic Competitiveness. “Transactions in the single family market have extended quarterly year-over-year gains for nearly two years, and condo sales have also risen sharply. Median prices in most areas of the state continue to fall; however, the rate at which they are falling has diminished significantly and this is indicative of a bottom approaching.

“How long prices stay at the bottom and when price appreciation will reappear will depend in a large part on the improving fundamentals in the economy and credit markets.”

If you need more information regarding Florida homeowner rights, contact our Jacksonville, Florida foreclosure law firm.

The Realtor Association of Greater Miami and the Beaches has launched a program designed to streamline the short sale process, which they say will help the market recover more quickly.

Here is the Sun-Sentinel report on the new program:

The Realtor Association of Greater Miami and the Beaches said Wednesday it’s introducing a program to improve the short sale process.

ShortSaleSolutions will reduce the time for processing short sales and help the market recover, according to the Realtors’ group, which is partnering on the project with the Greater Miami Chamber of Commerce.

The program is designed to reach homeowners who don't qualify for short sales through various government programs, said Deborah Boza-Valledor, chief operating officer of RAMB.

The goal of ShortSaleSolutions is for homeowners to get prequalified in five business days. Participating lenders then will be asked to come up with a price they'd be willing to accept within five days. After the real estate agent lists the home and gets an offer, lenders will have another five days to respond.

The key, of course, is the number of lenders that agree to participate. Ocean Bank is one. Boza-Valledor said RAMB still is finalizing the complete list.

The program can work, even if it starts out with only a handful of lenders, she said.

"Once something is successful, people will want to participate," Boza-Valledor said.

If you need help in defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

The rate of foreclosure on homes worth more than $1 million increased by 121 percent in February this year, making this market segment one of the largest growing foreclosure sectors in the U.S.

A report on CNBC.com noted:

The deterioration comes just as housing experts say that foreclosures in the low- and mid- ends of the housing market are showing signs of stabilization.

“They were able to stave off foreclosure longer,” says independent real estate analyst Jack McCabe, CEO of McCabe Research and Consulting in South Florida. “Lower-end homeowners were the first ones to see the escalating foreclosures because they generally do not have the cash reserves or credit available that the luxury homeowners do. They had the ability to take their credit cards and pull out thousands of dollars while the lower end buyers were already tapped out.”

McCabe expects to see foreclosures in the high-end market to increase into 2011.

In the Fort Myers, Fla. area, a second-home market for the wealthy, Mike McMurray of McMurray and Nette and the VIP Realty Group, says he has seen a few foreclosed homes on the market compared to none last year. He's currently showing a 4,800 square-foot, $3. 65 million home on Captiva Island, where foreclosures are usually very rare. The bank-owned home has five-bedrooms and access to 150-feet of Gulf coast beachfront.

"There are more we see coming down the pipeline," McMurray says.

If you are a Florida homeowner facing possible foreclosure, contact our Jacksonville, Florida foreclosure law firm.

Abel Harding’s blog for the Florida Times-Union recently focused on the glimmers of hope beginning to appear in the Jacksonville housing market as seen by two Jacksonville realtors:

Home sales seem to be showing signs of life.

I recently sat down with Linda Sherrer, president and CEO of Prudential Network Realty, and Christy Budnick, the company's executive vice president. Both were remarkably upbeat about what they see going on in the residential market.

The month of April was the 250-agent company's best month in open sales and volume since June 2006.

"The country wants things to settle down," Sherrer said. "People are tired of putting their lives on hold."

The contracts written, Budnick pointed out, have been across all price points, a sign that the rise cannot all be attributed to the wildly popular first-time homebuyer's tax credit program, which expired Friday.

In fact, contracts written in April for Prudential included 20 with a selling price over $840,000. Fifteen of the contracts were for homes selling for more than $1 million.

As good as that news may be, Sherrer said the real news has been in the improvement they are starting to see in appraisals. Some areas of Northeast Florida are now being labeled "stabilized" or "improving" in appraisals - a marked improvement over the "declining" designation Realtors and buyers were becoming all too familiar with. A "declining" designation could force a lender to lower an appraised value by as much as 5 percent - a measure that impedes sales.

Prudential continues to see an uptick in corporate relocations. Nevertheless, Sherrer, who also serves on the Board of Directors of the Jacksonville Branch of the Federal Reserve Bank of Atlanta, said long-term employment prospects continues to be a pressing issue.

Read the full post here.

For more information on your rights as a homeowner in the Florida foreclosure process, contact our Jacksonville, Florida foreclosure law firm.

Home sales in South Florida were up over 48 percent, year-over-year, in the first quarter of 2010, according to the Zillow Real Home Value Index.  However, the percentage of homeowners whose mortgages were underwater rose slightly, from 41.2 percent in the fourth quarter of 2009 to 44.3 percent in the first quarter of 2010.

From the South Florida Business Journal article:

Broward County home sellers took the biggest hit, with 54.3 percent selling at a loss. Miami-Dade home sellers took a loss 53.9 percent of the time. And 43 percent of Palm Beach County home sellers took a loss in the first quarter.

Nationwide, 23.3 percent of single-family homes had mortgages underwater, up from 21.4 percent in the fourth quarter of 2009.

Home values in Miami-Dade County fell to $160,500, down 19.9 percent, year-over-year. In Broward County, home values slid 17.3 percent to $135,900. And in Palm Beach County, home values fell 5.6 percent, year-over-year, to $158,900.

Nationwide, home values fell 3.8 percent, year-over-year, to $183,700.

But, home sales were up in the tri-county area. In Miami-Dade, sales rose 66.8 percent, year-over-year. They were up 55.7 percent in Broward and up 16.8 percent in Palm Beach.

"It's a very positive sign that several large markets have hit what appears to be a tentative bottom in home values," Zillow Chief Economist Stan Humphries said in a news release. "While this is no guarantee that home values there will not fall again, it is more likely than not that they will remain above their lowest point last year.”

For more information on how to protect yourself against possible foreclosure, contact our Jacksonville, Florida foreclosure law firm.

Florida is one of four states that have submitted plans to the Obama administration to use federal funds to pay unemployed or underwater residents’ mortgages.

From a report at CNNMoney.com:

The Obama administration is giving 10 states a total of $2.1 billion to come up with innovative ways to stem the foreclosure crisis. They are charged with finding solutions for the unemployed and underwater -- two groups typically shut out of loan modifications.

So far, Arizona, California, Florida and Michigan have made public their proposals, which include some pretty radical ideas, including mortgage subsidies and taxpayer-funded principal reductions. Treasury officials are reviewing the ideas and should rule on them within the next few weeks.

Florida hopes to assist up to 12,000 households with the $418 million it will receive. Still, this is only a drop in the bucket in a state which saw 153,540 properties receive a foreclosure filing during the first three months of the year, according to RealtyTrac.

The Sunshine State will cover up to nine months of a jobless, delinquent borrowers' monthly payments if the servicer agrees to match. The loan would be forgiven over five years as long as the borrower remains current and lives in the home. Florida might also pay down some of the homeowners' principal in order to make the loan more sustainable.

The state, which requires mediation before a servicer can foreclose, would also use $25 million to provide legal representation for borrowers during these negotiations. And it would provide $40 million for downpayment assistance for prospective homeowners.

Requiring servicers to match the payment subsidies will allow the state to help more people, said David Westcott, director of homeownership programs for the Florida Housing Finance Corp., which is administering the funds.

While many Florida residents now owe more than their homes are worth, Westcott said the state is looking to help only those in default because of a financial hardship, such as the loss of a job or a divorce. Those who mismanaged their money or can still afford their mortgages will not be assisted.

"We're not here to make you whole on paper," he said. "We're looking to help people who are committed to their homes and, with a little help, are able to stay in their home."

If you are a Florida homeowner facing possible foreclosure and need to know your options for defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

Jacksonville-based mortgage industry service provider Lender Processing Services says that in more than half the cases when loans are restructured, borrowers end up in foreclosure one year later.

From an article at Forbes.com:

Delaying foreclosures that are all but inevitable doesn't just harm individual families – it can drag the housing recession out longer.

"Unless property values skyrocket by 20 to 30% in the short term, these distressed properties will ultimately go to foreclosure. The problem is just snowballing," says Ted Jadlos, senior managing director of the Applied Analytics group at LPS. "We're talking about the housing hangover lasting until 2011."

Many loan modifications fail because they don't fix the borrower's immediate problem--unaffordable monthly payments. In fact, a restructured loan could end up costing more per month than what the mortgage-holder was originally paying--in some cases, twice as much, says Marietta Rodriguez, director for homeownership and lending for NeighborWorks America, a nonprofit that Congress created to promote home-ownership among low-to-moderate-income Americans.

But as unpleasant an ordeal as it is, "foreclosure" isn't necessarily a dirty word. Both for individuals and the housing market at large, it's not always a bad thing to allow a foreclosure to proceed--and sometimes doing so sooner, rather than staving off the outcome temporarily, is the right choice.

"Foreclosures are a symptom; the cause is borrower distress," says Jadlos. "We're going to have to let some burn occur--let the foreclosure process get started. Let banks manage portfolios of problem assets so they don't flood the market. You don't have to throw people out on the street. You can find some metric to turn some of these homes into rental units."

If you are a Florida homeowner facing possible foreclosure and need to know about all your legal options, contact our Jacksonville, Florida foreclosure law firm.

A Jacksonville foreclosure attorney noted that the latest foreclosure filings report out May 13 from RealtyTrac shows that foreclosures in the U.S. have hit a plateau.

All foreclosure filings – which include bank repossessions, notices of default and auction notices – fell 9 percent from March to April and by 2 percent from April 2009.

However, the number of home repossessions is at an all-time high at 92,432 – a 45 percent increase from one year ago.

From a report at CNNMoney.com:

"There were two important milestones in the April numbers that show foreclosure activity has begun to plateau, but at a very high level that will not drop off in the near future," said RealtyTrac CEO James Saccacio.

Saccacio said he expects the pattern to become the norm for many months, with the overall numbers of filings staying high, but not increasing, and repossessions remaining at record levels.

The reason that repossessions can rise while filings hold steady is that lenders are working through a backlog of delinquent properties, taking more of them through the entire process to repossession, rather than letting them linger in limbo.

The numbers of repossessed properties, also called real-estate owned or REOs, have been boosted by a spike in the number of homeowners voluntarily giving up their homes because their the value has dropped so precipitously.

These "strategic defaults" now account for nearly one in three foreclosures, according to a recent report from the University of Chicago Booth School of Business and Northwestern's Kellogg School of Management. That's up from 22% 12 months earlier.

If you are a Jacksonville homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

According to a report out earlier this month by the American Bankruptcy Institute, there were almost 150,000 personal bankruptcies filed in March 2010 – the highest consumer filing total since 2005, when Congress overhauled the Bankruptcy Code.

The ABI noted that the March filing is a 34 percent increase from February 2010, and a 23 percent increase from the same month one year ago.  Chapter 7 bankruptcy filings made up the majority of the March number; Chapter 13 bankruptcy filings accounted for 25 percent of the total.

From a report on bankruptcycorner.com:

Katherine M. Porter, a bankruptcy expert at the University of Iowa and the University of California, Berkeley’s Boalt Hall Law School, says people typically ’seriously struggle’ with their debt for two years before turning to bankruptcy.

“The statistics show that Chapter 7 bankruptcy filings are rising faster than the more complex Chapter 13 filings. While the latter requires individuals to repay a substantial portion of their debt and prevents banks from foreclosing on their homes, Chapter 7 bankruptcy allows a debtor to wipe out his or her debts entirely and get a fresh start. ‘It is very fast and very deep debt restructuring,’ says Porter. Since 2005, Chapter 13 filings have dropped from about 35% of all personal bankruptcy filings to 25%, she says. ‘Systemically, that’s a big change.’ ”

If you have questions about filing bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

According to a Jacksonville bankruptcy lawyer, a recent article at NakedLaw.com pointed out five surprising facts about bankruptcy in America – surprising from the standpoint that they debunk some of the preconceived notions Americans have about bankruptcy:

1.  Bankruptcy filings increased by 30% in 2009 – so if you are thinking about filing bankruptcy, you are certainly not alone.

2.  1 in every 70 American households files for bankruptcy – so there is a pretty good chance that someone you know has recently filed bankruptcy.

3.  Almost half of American families spend more than they earn – so the debt your family has piled up is hardly unusual in today’s economy.

4.  There are over 100,000 bankruptcy filings each month in America – so, again, if you are facing bankruptcy, you have lots of company, especially in the hard-hit states of Florida, California and Nevada.

5.  No one is immune to bankruptcy – so whether you have a college degree or not, in a tough economy, everyone suffers.

To fully understand what you need to know about filing bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

One Jacksonville bankruptcy lawyer says that a recent Supreme Court ruling that the “bona fide error defense” does not protect debt collectors that make mistakes interpreting the legal requirements of the Fair Debt Collection Practices Act may give consumers additional legal recourse against abusive debt collection efforts.

From the Wall Street Journal article on the ruling in Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich, 08-1200:

The Supreme Court Wednesday made it easier for consumers to sue debt collectors for sending erroneous collection notices.

The high court, in a 7-2 opinion by Justice Sonia Sotomayor, ruled that debt collectors can't shield themselves from such lawsuits by arguing that they made a legal error when sending a collection notice...

At issue were the actions of an Ohio law firm that initiated foreclosure proceedings on behalf of Countrywide Home Loans Inc.

The homeowner, Karen Jerman, disputed that the debt existed. Countrywide later acknowledged that Ms. Jerman had in fact paid the debt, and the law firm withdrew the foreclosure lawsuit.

Ms. Jerman then sued the law firm, arguing that it violated federal debt-collection law by stating in its foreclosure suit that Ms. Jerman's alleged debt would be assumed to be valid unless she contested in writing.

A lower court agreed with Ms. Jerman that the firm violated the federal Fair Debt Collection Practices Act, but ruled that the law firm was shielded from liability because the violation wasn't intentional and was the result of a bona fide legal error.

Justice Sotomayor and the court disagreed, ruling that Congress hadn't explicitly provided a mistake-of-law defense to debt collectors.

If you need to know your legal rights as they pertain to debt collection, contact our Jacksonville, Florida bankruptcy law firm.

Florida residents who are considering filing Chapter 7 or Chapter 13 bankruptcy may be concerned that a bankruptcy filing will wipe out their retirement plan funds, says one Jacksonville bankruptcy lawyer.

Fortunately, retirement accounts are considered exempt property in a bankruptcy filing.  And, with a few exceptions, the amount of the exemption is unlimited, protecting the entire amount of the retirement account.

Retirement plans that qualify for this exemption include any ERISA-qualified pension plan:

• 401(k) plans


• 403(b) plans


• Roth, SEP and SIMPLE IRAs


• Profit-sharing plans


• Keoghs


• Defined benefit plans


• Money purchase plans

For traditional and Roth IRAs, there is an exemption limit of $1,095,000 per person; if your plan’s value is more than this, the bankruptcy court can use the excess to repay your creditors.

If you have taken a loan from your retirement account, that debt cannot be discharged in a Chapter 7 bankruptcy.  If you file Chapter 13 bankruptcy, any remaining debt from your retirement account loan can be discharged at the end of the Chapter 13 bankruptcy (usually three to five years).

If you need more information on the impact of a Chapter 7 or Chapter 13 bankruptcy filing, contact our Jacksonville, Florida bankruptcy law firm.

In a Florida Chapter 13 bankruptcy, you make payments each month to a court appointed trustee, who then pays your creditors according to the requirements of your Chapter 13 bankruptcy plan.

Upon the successful completion of your plan – usually in three to five years – any remaining debt is discharged.

A typical Chapter 13 bankruptcy plan will include these debt classifications:

Administrative claims – includes attorney’s fees, the bankruptcy filing fee and the trustee’s commission.  All these must be paid in full.

Priority debts – includes back alimony and child support, state and federal income tax debt, contributions to an employee benefit fund and any wages or commissions you owe to employees.  These must be paid in full.

Secured debts – includes mortgage debt, car loans and other debt secured by property.  These must be paid in full to retain ownership of the property.

Unsecured debts – includes credit card debt, medical bills and any other debt not secured by property.  These are the debts that receive a percentage payoff, depending on the amount of disposable income you have to satisfy your monthly debt payments, the value of the nonexempt property, and the length of your bankruptcy plan.

If you need more information on how a Chapter 13 bankruptcy filing might help you, contact our Jacksonville, Florida bankruptcy law firm.

Less than one year ago, American auto giant General Motors was in Chapter 11 bankruptcy and on its way to being the recipient of $50 billion in federal bailout funds.

Today, GM is making their loan payments ahead of schedule.  And, since emerging from Chapter 11 bankruptcy last July, the company has committed over $2.3 billion to invest in 22 of its U.S. and Canadian manufacturing facilities and restored or created over 9,000 jobs.

From a Wall Street Journal report:

GM Chairman and Chief Executive Edward E. Whitacre Jr. believes repaying what is left of its $6.7 billion U.S. Treasury loan is a critical step toward winning back U.S. customers. Ford Motor Co.'s status as the only Detroit automaker to avoid a government bailout has helped the company outperform its rivals.

An early repayment signals that GM executives are confident it is financially stable without the cash. GM lost $4.3 billion in the last half of 2009, but Mr. Whitacre has forecast a "solid" first-quarter when GM releases its financial results next month.

The automaker’s sales in March were up 17% compared with one year ago, according to Autodata.com.

If you are considering filing Chapter 11 bankruptcy in Florida, contact our Jacksonville, Florida bankruptcy law firm.

Three New York homeowners have filed suit against JP Morgan Chase, claiming that the bank illegally delayed and denied their HAMP foreclosure prevention applications.

From a Crain’s New York report:

The lawsuit, which was filed in the Eastern District Federal Court in Brooklyn, claims that the bank violated the federal program that requires banks to provide permanent modifications to eligible homeowners who complete three months of trial payments and verify their income. Similar lawsuits have been filed against a number of other banks, such as Bank of America and Wells Fargo, in other states over the past year. Last month, a California couple reportedly sued Chase because it told them to stop making mortgage payments so they could qualify for loan modification. Chase then foreclosed on their home.

“Chase breached their contract,” said Carmela Huang, an attorney at the Urban Justice Center, which is representing the Queens homeowners in the case. “As far as we know, this is the first case in New York.”

Despite making timely trial modification payments two of the homeowners were denied permanent loan modifications and their homes were foreclosed, according to the lawsuit. Chase claimed that their incomes were inadequate for the permanent loan modification, but refused to specify income qualifications, said Ms. Huang.

Similar to the California case, the third plaintiff in this lawsuit is a homeowner in Fresh Meadows who claims that the bank instructed him last month to deliberately miss payments so he would be eligible for a loan modification. The homeowner had refinanced in 2005. As a result of missing two monthly payments, the homeowner now faces foreclosure. While the homeowner was placed on trial modification last year, he was denied permanent status based on the value of his house. But the bank has not disclosed the value. The Home Affordable Modification Program requires banks to offer trial modifications as long as the value of modifying the loan is more than the value of foreclosing.

If you need more information regarding Florida homeowner rights, contact our Jacksonville, Florida foreclosure law firm.

A lot of Florida homeowners facing foreclosure think they don’t have a prayer of keeping their home.  And now houses of prayer all over the country are joining those foreclosure ranks in increasing numbers.

According to a recent Reuters report, foreclosure proceedings against churches in the U.S. have tripled over the past three years.  In addition, more than 100 churches have declared bankruptcy.

Churches emerged from previous economic downturns relatively unscathed, lenders noted. But the recent recession was preceded by an unusual boom in church building.

Spending on construction of religious buildings rose sharply in the late 1990s, climbing 70 percent from 1995 to 1999 to an annual rate of $7.3 billion. New building continued to tick up, eventually reaching an annual rate of nearly $9 billion in 2003 before leveling off, according to data from the U.S. Census Bureau.

As was the case in the residential housing market, the church property boom was accompanied by the rise of more specialized lending. Church lending was historically done by community banks, which sometimes have ties through a member of a congregation. Loans were often set at a fixed rate and for a set term.

Many of the loans made in recent years contained many of the same features that exacerbated the residential real estate crash, such as low-interest teaser rates, securitized loans and balloon payments.

As a result, bad loans are rising rapidly for those lenders that pushed aggressively into church finance. Delinquent loans at the Evangelical Christian Credit Union, which expanded its loan portfolio from about $225 million to more than $1 billion over the last decade, have risen to 7.4 percent of their loans from 3.6 percent a year ago. Until 2007, the lender did not have a loan in foreclosure.

If you need help in defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

The National Association of Realtors announced this week that more Americans signed contracts to purchase existing homes in March, spurred by the expiring home buyer tax credit and job gains.

According to a Bloomberg report:

Sales of previously owned homes, which account for about 90 percent of the housing market, rose 6.8 percent in March. New home purchases, which make up the rest of the market and are tabulated when a contract is signed, surged 27 percent in March, the biggest jump since 1963, Commerce Department figures showed on April 23.

The tax credit for first-time homebuyers was extended in November to include some current owners, and requires buyers to close transactions by June 30.

“Clearly the homebuyer tax credit has helped stabilize the market,” Lawrence Yun, the Realtors group’s chief economist, said in a statement. “Later in the second half of the year, and into 2011, home sales will likely become self-sustaining if the economy can add jobs.”

Yun said sales will be “measurably lower” in the months immediately following the expiration of the tax incentive.

If you are a Florida homeowner facing possible foreclosure, contact our Jacksonville, Florida foreclosure law firm.

Since Florida is a judicial foreclosure state, which means that your lender must go to court to start the foreclosure process, Florida courts have become overwhelmed with the staggering amount of new foreclosure cases in the past three years.

The passage of a new budget means that Florida courts will get an additional $6 million to hire additional judges and case managers to deal with the backlog of Florida foreclosure cases.

From an article in the Palm Beach Post:

The one-time allocation for the judges, which is included in the state's 2010-2011 budget, is less than the $9.6 million that judges requested through the Florida Courts Administration earlier this year.

"Still, it's $6 million more than we had before," said Peter Blanc, chief judge of Palm Beach County's 15th Judicial Circuit. "It will give us a chance to address the backlog."

Statewide, the courts administration estimates there are about 500,000 foreclosures.

Blanc said earlier this year that Palm Beach County had 55,000 cases backlogged, but believes that may be a few thousand fewer today. Palm Beach County Circuit Judge Meenu Sasser, who oversees the foreclosure division, could not be reached Friday.

Court leaders are expected to meet next week to discuss how the money will be divided among the circuits. It could be used to hire senior judges, case managers and magistrates.

For more information on your rights as a homeowner in the Florida foreclosure process, contact our Jacksonville, Florida foreclosure law firm.

A new study by University of Arkansas economists entitled, The Foreclosure Crisis: Did Wall Street Practice Predatory Lending or Did Households Overreach? says that “there is plenty of blame to go around” for the current housing crisis and that while lenders did extend too much easy credit, borrowers bought more home than they could afford.

From an article on the university website:

The researchers found that most households in foreclosure were relatively affluent and highly educated people, with few or no children, living in geographical areas that experienced extremely rapid real-estate appreciation – the housing bubble. Although they found some evidence of predatory lending, the authors concluded that a more accurate explanation of the foreclosure crisis was that consumers overreached and bought more housing than they could afford.

By far, the group with the greatest excess foreclosure percentage was “Cash & Careers,” the most affluent generation (Generation X) of adults born between the mid-1960s and early 1970s. Members of this group had high household incomes, high education levels, high home values and none to only a few children. Also, members of this group were classified as aggressive investors, most of who lived in areas – California, Nevada, Arizona and Florida – of rapid real-estate appreciation.

If you are a Florida homeowner facing possible foreclosure and need to know your options for defending a Florida foreclosure, contact our Jacksonville, Florida foreclosure law firm.

Florida Attorney General Bill McCollum launched a civil investigation into a large Florida foreclosure law firm this week, saying that the Tampa-based Florida Default Law Group may have presented false and misleading documentation in thousands of Florida foreclosure cases.

The allegation listed on the AG website says:

Appears to be fabricating and/or presenting false and misleading documents in foreclosure cases. These documents have been presented in court before judges as actual assignments of mortgages and have later been shown to be legally inadequate and/or insufficient. Presenting faulty bank paperwork due to the mortgage crisis and thousands of foreclosures per month. This firm is one of the largest foreclosure firms in the State. This firm appears to be one of Docx, LLC a/k/a Lender Processing Services' clients, who this office is also investigating.

The investigation is being handled by the AG’s Economic Crimes Division in Ft. Lauderdale.

The foreclosure crisis is rapidly highlighting the flaws in loan ownership documentation.  Since many consumer home loans were repackaged for sale to securities investors, it is often difficult to determine ownership.  When filing a Florida foreclosure action, a lender must provide legal proof that they own the loan.

If you are a Florida homeowner facing possible foreclosure and need to know about all your legal options, contact our Jacksonville, Florida foreclosure law firm.

A Jacksonville foreclosure attorney noted that JP Morgan Chase has opened two offices in Central Florida to assist homeowners facing foreclosure.

Chase Homeownership Centers opened in Kissimmee and Riverview the first week in May.  Each center has trained counselors who meet with borrowers to discuss loan modifications and other options that may help families avoid foreclosure.

In addition, according to a May 5 Chase report, Chase is hosting multi-day foreclosure prevention events in eight markets:

Chase began the multi-day events in Florida, where counselors met with 3,200 customers.  Half the homeowners spoke to counselors in less than 10 minutes, and a total of 85% waited no more than 30 minutes before speaking one-on-one with a counselor. Nearly three-quarters of the customers said their experience was excellent while another 12% said it was very good.

"We are building on the terrific customer experiences at our Chase Homeownership Centers across the country," Lowman said.  "The centers have provided personalized help to more than 91,000 borrowers, and we expect these events will helps thousands more in just a few days."

Homeowners with Chase mortgages can receive the following services at the events:

• Initial counseling for homeowners applying for a mortgage modification


• Counseling for customers who are current on their mortgage but are struggling


• Short-sale assistance for customers who cannot afford their home or don't want to stay in it

If you are a Jacksonville homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

A Jacksonville bankruptcy lawyer notes that there are certain circumstances when it may make sense for those who are in Chapter 13 bankruptcy to convert to Chapter 7 bankruptcy.

Florida bankruptcy law allows debtors to convert from Chapter 13 bankruptcy to Chapter 7 bankruptcy at any time during the repayment period.

This can be a useful provision if:

• Your financial condition has changed dramatically and you are no longer able to make your scheduled payments according to your Chapter 13 bankruptcy plan.  The most common reason for this is the loss of a job.


• The size of your household has changed and you have increased expenses to support those people.  This can occur if you must take in an elderly relative, or if you have a child.


• You incur significant medical debt because of an illness or accident and cannot afford to pay your medical bills.

You should first consult with a Florida bankruptcy lawyer to determine if you qualify for a conversion from Chapter 13 to Chapter 7 bankruptcy.

If you need help navigating the intricacies of filing Florida bankruptcy, contact our Jacksonville, Florida bankruptcy law firm.

Some fairly infamous properties are in the news for falling victim to foreclosure.

From the New York Post:

The scene of Bernie Madoff's spectacular crimes is now facing its own melodrama.

The Post has learned that the famed Lipstick Building is inching toward foreclosure, thanks in part to Madoff himself.

According to people familiar with the matter, Royal Bank of Canada is looking to unload a $210 million mortgage it holds on the distinctive tower at 885 Third Ave., which has fallen on hard times as a result of lower rent revenue. The Ponzi king -- jailed last June in the wake of his $65 billion scheme -- occupied three floors in the building.

From the South Florida Business Journal:

Miami condo developer Renzo Renzi could soon be looking for new digs after losing a $4.3 million foreclosure judgment on his home.

Coconut Grove Bank won the judgment based on a $3.6 million mortgage, plus interest and fees.

It targets the 4,595-square-foot home at 60 Casuarina Concourse, in the Gables Estates neighborhood along Biscayne Bay, along with three units in The Sail, a downtown Miami condominium that Renzi developed.

The properties are set for online auction on Aug. 9.

After facing numerous foreclosure lawsuits, Renzi has lost the Emerald Plaza and 100 Alhambra Tower projects along with two other units in The Sail to lenders.

If you are a Florida homeowner facing possible foreclosure and need to know about all your options, contact our Jacksonville, Florida foreclosure law firm.

One Jacksonville bankruptcy lawyer says it is important for consumers who are being harassed by debt collectors to maintain as much privacy as possible, especially when it comes to social networking sites on the Internet.

Debt collectors routinely search popular social networking sites like LinkedIn, Facebook, MySpace and Twitter to gather as much information as possible about debtors.  They may even request to join your social network as a friend or follower in order to gain more access to your personal information.

If you are an active member of any social networking site and wish to protect yourself against debt collectors gathering your personal information, you should:

• Set all your social network account settings to “private” so only those you know can view your personal information.


• Never list your contact information – phone, email address or physical address -- on a social networking site.


• Do not list any employment information on any of your social networking sites as debt collectors may use this information in an attempt to garnish your wages.


• Never accept an invitation to “friend” someone you do not know, even if they say they are a friend of someone you do know.

If you need more information about how to get debt collectors to stop harassing you, contact our Jacksonville, Florida bankruptcy law firm.

Debt collectors are becoming more aggressive than ever, and one Jacksonville bankruptcy attorney says that consumers need to know their rights when it comes to what debt collectors can and cannot do when attempting to collect a debt.

The Fair Debt Collection Practices Act established clear guidelines on what debt collectors are not allowed to do in their attempt to collect a legitimate debt:

• Debt collectors cannot call you before 8 a.m. and after 9 p.m. unless you give them permission to do so.  You can also request that they not contact you at work.

• Debt collectors cannot speak to anyone other than the debtor or the debtor’s spouse or attorney about the debt.  They are allowed to contact other people only to obtain information about a debtor’s location, and are prohibited from contacting a third party more than once for this information.

• Debt collectors must provide you with written information about the debt, how much you owe, the name of the creditor and how to respond if you don’t think you owe the money.  They must do this within five days after they first contact you.

• Debt collectors cannot keep contacting you if you have notified them in writing that you do not believe you owe any or all of the money, or if you have requested verification of the debt.

• Debt collectors are also prohibited from threatening you, using abusive language, repeatedly using the phone to annoy you, lying about the debt, misrepresenting themselves or their company, and engaging in unfair practices.

If you are considering filing bankruptcy in Florida because of debt collector harassment, contact our Jacksonville, Florida bankruptcy law firm.

While bankruptcy helps millions of Americans get a fresh financial start every year, it does not necessarily cure every financial ill.

Here is what bankruptcy cannot do for consumers:

Bankruptcy cannot discharge certain types of debts that have been singled out by bankruptcy law.  These include child support, alimony, most types of student loans, most taxes, court restitution orders and criminal fines.

Bankruptcy does not eliminate certain rights of secured creditors, which include those who have taken a mortgage or other lien on property used as collateral for a loan.  Under Chapter 13 bankruptcy, secured creditors can be forced to take payments over time as part of the bankruptcy plan.  Bankruptcy can eliminate an obligation to make additional payments if a debtor returns the property to the secured creditor.  Generally, a debtor cannot keep secured property unless payment continues.

Bankruptcy will not protect cosigners, so if a debtor has a loan that has been cosigned by a friend or relative and that loan is discharged in bankruptcy, the cosigner may still have to repay part or the entire loan.

Bankruptcy will not discharge any new debts that are accrued after bankruptcy has been filed.

For more information on Florida bankruptcy laws, contact our Jacksonville, Florida bankruptcy law firm.

A Jacksonville bankruptcy lawyer says that small business owners may be able to discharge business debts by filing Chapter 7 consumer bankruptcy.

High unemployment rates have created a lot of sometimes-reluctant entrepreneurs.  Add that to the fact that most small businesses suffer from a fairly large failure rate, and you wind up with a fairly large number of small business owners in big financial trouble.

Generally, by filing a Chapter 7 bankruptcy, a small business owner can discharge his obligation on his business debts.  This is because a Chapter 7 bankruptcy allows you to discharge your personal obligation to pay the business debt.  And since most of your business debt was probably secured by a personal guarantee, this qualifies that business debt as one that can be discharged in Chapter 7 bankruptcy.

Other Chapter 7 dischargeable debts include leases, guaranties, negligence claims, tax penalties over three years old, personal loans, credit card debt, repossession deficiencies, auto accident claims, medical bills and judgments.

If you are a small business owner and need more information on how a Chapter 7 bankruptcy filing might help you, contact our Jacksonville, Florida bankruptcy law firm.

One Jacksonville bankruptcy lawyer says that bankruptcy is a better alternative to settling debts through a debt settlement company.

Florida has become a rich hunting ground for predatory debt settlement companies, whose pitch usually plays on all the fears that consumers have regarding bankruptcy – fears which are often unjustified.  These companies prey on debtors who are already stressed over their mounting debt and offer them “hope” in the form of a fat upfront fee.

To truly understand all your options for debt relief – including debt settlement, bankruptcy, loan modification, etc. – you really need to speak with a Florida bankruptcy attorney.  If you fall for a debt settlement scheme, it could end up costing you a lot more.

While you wait for a debt settlement company to negotiate with your creditors, you can go into default and those creditors can increase your interest rates, late charges and fees as well as file a lawsuit against you.  You may even be subject to wage garnishment if they are able to obtain a judgment against you.  Debt settlement companies don’t help you with any of those legal ramifications.

For help in reaching the best decision for your circumstance, contact our Jacksonville, Florida bankruptcy law firm.