Bankruptcy and Foreclosure Attorney Blog

Florida hedge fund manager George Levin and his wife Gayla have reached a settlement with the bankruptcy trustee in the Scott Rothstein Florida Chapter 11 bankruptcy case and will make a $5 million payment as well as sell assets to satisfy the terms of the settlement agreement.

Levin is the head of Banyon Capital, a hedge fund that funneled nearly $830 million to a Ponzi scheme run by Fort Lauderdale attorney Scott Rothstein. Rothstein pled guilty in January and was sentenced in June to 50 years in prison.

The Levins and Banyon agreed to an asset sale to repay investors who were victims of Rothstein’s Ponzi scheme. According to court records, the Levins will make an initial payment of $5 million and will get to keep 15 percent of the assets sold. The remainder will go to the bankruptcy trustee for redistribution.

The settlement also allows the Levins to keep their $4.2 million home in Ft. Lauderdale, as well as $750,000 in personal property.

The Levins contend that they were unaware that Rothstein was running a Ponzi scheme. Banyon Capital was sued by investors last November, who claimed that Levin had conspired with Rothstein in the scheme.

Levin retired to Florida at age 32 after making a fortune with several Philadelphia retail businesses.

According to a Wall Street Journal story, the bankruptcy trustee charged with recovering money for the victims of the Bernie Madoff Ponzi scheme is preparing to sue investors who profited from their Madoff investments.

Irving Picard, the Chapter 11 bankruptcy trustee for Bernard L. Madoff Investment Securities LLC, said that about half of the 2,000 investors he calls “net winners” could be sued to recover a portion of their Madoff investments, which would go into a fund for redistribution to other victims.

The so-called “clawback lawsuits” must be filed by December 2010. To date, Picard has filed more than a dozen civil suits seeking more than $15 billion in total from Madoff’s brother, sons, investment firms with ties to Madoff and other wealthy investors who profited from their investments with the convicted Ponzi scheme operator. He has already collected about $1.5 billion in assets.

Picard has already sent hundreds of letters to investors asking them to “resolve the matter amicably.” Not many have taken him up on his offer. South Florida resident Adele Fox is one of those investors who says she received a letter from Picard asking her to repay over $690,000. She told the WSJ that she had all her money tied up with Madoff, which she thought totaled over $3 million. She said if Picard comes after her for the money, which she claims is all she has left, she will be penniless.

For small businesses that are unincorporated, the business owner is responsible for the debts of the business, which can make filing Chapter 7 bankruptcy a desirable choice if you are the sole proprietor of a troubled Florida business.

For small business owners who file Florida Chapter 7 bankruptcy, there are several benefits. First, your future assets are protected from satisfying any pre-bankruptcy debt, which means that you can start a new business or take another job without the worry of having future assets seized to satisfy old debts.

Second, Florida has a number of bankruptcy exemptions, including an unlimited homestead exemption for those who have been a Florida resident for at least two years. This means that any real or personal property that does not exceed a half-acre within a municipality or 160 acres elsewhere is exempt from the bankruptcy filing.

In addition, other Florida exemptions include:

Insurance – including annuity contract proceeds, death benefits, disability benefits, illness benefits, fraternal society benefits (if received prior to 10/1/96) and the cash surrender value of a life insurance policy.

Pensions – ERISA-qualified benefits, state officers and employees, county officers and employees, firefighters, police officers, highway patrol officers, teachers.

Wages -- $100 of wages for heads of family up to $500 per week and deposited into bank account for up to six months.

Personal property – any personal property up to $1,000 for one person or $2,000 for a married couple, health aids, motor vehicle up to $1,000.

Public benefits – Social Security payments, unemployment compensation, veterans’ benefits, workers’ compensation, public assistance, crime victims’ compensation, hazardous occupation injury damages.

Other – alimony, child support, property of business partnership, pre-planned funeral contract deposits.

A Chapter 13 bankruptcy is also known as reorganization and allows you to set up a 3-5 year payment plan. In this plan you will pay your debts to your court appoint trustee who collects the money and pays an agreed upon percentage of that money to your creditors.

Here is what most consumers may not know: You do not have repay all your debts! And, the debts you do pay back receive only a portion of what you owe them.

Your payments will be based on how much you can afford to pay each month.

Another secret many people do not know about Chapter 13 is that you can change your interest rates on your car loans. For example, say you own a lot of money on your car so you go to a title-loan company. They charge you over a 100% a year interest (yes, this actually happened). Now, instead of making a few hundred dollar per month car payment, you accrue a monthly payment of $1,000 - an amount you simply cannot afford. In a Chapter 13 bankruptcy, you may be able to change the interest rate on loans similar to this and decrease the interest rate to somewhere around 4.25%! This low interest rate combined with the 3-5 year payment plan will provide you plenty of cushion, keep the payments small and affordable and keep your car.

Continue reading " Secrets about a Chapter 13 Bankruptcy in the State of Florida " »

Are you an average consumer with some debts? Are you unsure if bankruptcy is right for you? Or, whether bankruptcy is even an option for you at all? Call a Jacksonville, Florida Bankruptcy Attorney immediately. An attorney will sit down with you, explore your options and help you decide whether bankruptcy is right for you.

Something most people do not know is that you do not need to be $10,000, $20,000 or $25,000 in debt to file - there are no debt limits or debt requirements.

Below is a list of indications that you are in financial trouble and should see legal recourse:
1. Are you living paycheck to paycheck?
2. Are you unpaid debts causing your stress because you have no idea how you will repay them?
3. Are you not opening your mail because of overdue bills?
4. Are your ignoring calls from aggressive collectors?
5. Do you have to pay most of your bills late because you just do not have the money?
6. Do you have more than 3 credit cards with balances on them?
7. Are most of these credit cards maxed out?
8. Do you find yourself paying late fees regularly?
9. Are you one month or more behind on your mortgage or credit card payments?
10. Is your car at risk of being repossessed?
11. Is your home in pre-foreclosure?

Continue reading " Is Bankruptcy Right for Me? - A Checklist to determine whether or not You should consider filing for Bankruptcy in the State of Floria " »

Teresa Giudice , who stars on Bravo TV’s “Real Housewives of New Jersey,” recently told People Magazine that she and her husband filed bankruptcy last October to get a fresh start after investing in “real estate deals gone bad in a bad economy”.

However, the bankruptcy trustee in her case has accused the Giudices of misleading the court about the value of their assets and is proceeding with a scheduled auction on Aug. 22 to sell many of their possessions at their Towaco, N.J. mansion.

The Giudices’ attorney says that the couple has not misled the court, and that he is appealing the decision and hopes the auction will not take place. In his appeal, he said that many of the items listed for sale were purchased after the bankruptcy filing, with money earned post-petition. He has argued that those items purchased after the filing should not be included as part of the bankruptcy assets.

In a blog on Bravo’s web site, Giudice wrote about the bankruptcy filing: “The economy crash trickled down to everyone. We worked so hard for so many years and it was heartbreaking to file, and not something we took lightly. Of course you can't sit in your bed and just cry all day, so we moved forward, got new jobs, and are working hard once again. The point is to get a fresh start so you can move forward.”

Luckily for most Americans, you don’t need to be a reality TV star to get a fresh start by filing bankruptcy. If the economic downturn has affected your family adversely and you have more debt than you can handle, contact a Florida bankruptcy attorney to learn about your options for getting a fresh start.

Florida’s June unemployment figures were released last week and those who were hoping for good news have been disappointed. In metro Jacksonville, unemployment rose to 11.2 percent in June after three months of consecutive declines. In Duval County, the unemployment rate for June was 11.7 percent, up from 11.4 percent in May and from 11.0 percent in June of 2009.

With unemployment continuing to rise, personal bankruptcy filings could climb in the next six months. Bankruptcy filings are a lagging indicator, which means that higher rates of unemployment now (a leading contributing factor to filing bankruptcy) can mean more filings a few months down the road.

The Florida Agency for Workforce Innovation released the latest employment statistics for the state, which can be found here.

Among the findings:

People out of work in metro Jacksonville in June totaled 77,356 in June, up from 71,788 one year ago.

Six counties in Northeast Florida had gains in unemployment numbers for June: Baker County up .5 percent to 11.2 percent, Clay County up .2 percent to 10.3 percent, Duval County up .3 percent to 11.7 percent, Nassau County up .3 percent to 10.8 percent, Putnam County up .9 percent to 13.4 percent and St. Johns County up .4 percent to 9.6 percent.

The total unemployment rate for Florida in June was 11.6 percent, up .5 percent from one month ago. The national unemployment rate was 9.6 percent.

The majority of new job losses were in construction, financial services, manufacturing and information technology. There were job gains in private education and health services, government and professional and business services.

Continue reading " Jacksonville Unemployment Rises to 11.2 Percent in June " »

Lisa Myers, an investigative reporter for NBC News, provided a report on the Today Show on July 7 that profiled the debt settlement industry. She interviewed Helen Wilson, whose family was struggling with debt after paying a relative’s medical bills. After doing an Internet search, Wilson said she found Credit Solutions, a debt settlement company in Dallas, which she said claims it can settle debts for half what consumers owe and allow them to be debt-free in three years.

Wilson said she was told by Credit Solutions to ignore bills and warning notices from creditors. When the harassment escalated, she called the company for help and was told they would deal with her creditors. However, Wilson said that after a year, her family’s debt is higher and one creditor has sued them. She says the $6,000 she had to pay to Credit Solutions as an upfront fee could have been used for her bills.

In response, Credit Solutions said they generated 11 settlement offers for Wilson, who said she could not afford them. Credit Solutions also denied telling Wilson to stop paying her bills. But that’s not what Myers found.

Going undercover as a consumer with debt, Myers called the company and asked: Do I go ahead and make that payment (on my overdue bills)? The answer she got: “No, no, you stop right away.”

The debt settlement industry blames a few bad apples for these headlines, but the Federal Trade Commission is moving to crack down on them and ban upfront fees.

The Attorneys General of three states – Texas, New York and Missouri -- have all charged Credit Solutions with false advertising and deceptive practices, saying that 80% of debts do not settle.

To see the entire NBC News Today Show investigative report, go here.

Continue reading " Debt Settlement Industry Profiled in NBC News Investigative Report " »

Eligibility:
Any individual residing domiciled or having property in the United States may file a Chapter 7 Bankruptcy. To file for bankruptcy in Florida, you must have lived in the state for 180 days (6 months) prior to filing the bankruptcy petition.

Should You File?:
The decision to file for bankruptcy is not easy. It would be wise to contact a Florida Bankruptcy Attorney to discuss whether or not bankruptcy is the best option for you. Before deciding to file, you and your attorney should carefully weigh the pros and cons of filing.

Here are some things to consider in your decision making process:

1. Do you owe a small amount of debt?- If you only owe a small amount of debt bankruptcy is probably not the best option for you. Try working out a payment plan or arrangement with your creditors.
2. Are you considered "collection proof?"- An individual who is considered "collection proof" is a person who does not own any property that a creditor can take to satisfy the debt, does not have any wages that can be garnished, or has wages that are exempt from garnishment.
3. Do you foresee any continuing debts?- Because you cannot discharge debts incurred during bankruptcy and if you anticipate going into debt in the future, you may want to delay filing for bankruptcy. This does not mean to commit fraud by obtaining goods or services on credit without the intent to pay.
4. Your credit score will be affected.- A Chapter 7 Bankruptcy stays on your credit history for 10 years. The debts discharged as a result of the bankruptcy will be noted on your credit record as discharged.
5. Know your non-dischargeable debts.- Some debts are non-dischargeable, meaning that your obligation to pay is not removed by the bankruptcy. If most of your debts are non-dischargeable bankruptcy may not be the best option for you.
6. Non-exempt Property.- Limits exists as to how much property you can exempt from the bankruptcy. If you own valuable property that cannot be exempt because you are over the exemption limits, you risk losing that property in your bankruptcy.
7. Last Resort.- The decision to file for Chapter 7 bankruptcy should be discussed with a Jacksonville Bankruptcy Attorney prior to filing.

Continue reading " Simple Questions, Tough Decision: Are You Eligible to File for Bankruptcy in Florida? And, if so, Should You? " »

Foreclosure homes accounted for 31 percent of all residential sales in the first three months of 2010, according to a report just released by RealtyTrac, the online marketplace for foreclosed properties.

In its first U.S. Foreclosure Sales Report, the average sale price of foreclosed properties was almost 27 percent below that of homes not in the foreclosure process.

Florida was one of eleven states where foreclosure sales accounted for at least one-third of all residential sales in the first quarter of 2010. Almost 233,000 foreclosure and bank-owned homes sold in the U.S. during the first three months of the year, down 14 percent from the previous quarter and down 33 percent from the first quarter of 2009.

The RealtyTrac report showed that foreclosure sales in the U.S. have increased a whopping 2500 percent from 2005 to 2009, when they accounted for 29 percent of all U.S. home sales. During 2009, more than 1.2 million home sales were properties in foreclosure.

According to the RealtyTrac website, there are currently over 11,500 properties in the process of foreclosure in Duval County, including 5,660 defaults, 1,575 auction properties, 3,470 bank-owned properties and 915 MLS homes for sale.

Continue reading " Foreclosure Sales At 31 Percent of All U.S. Home Sales in First Quarter of 2010 " »

http://www.woodatter.com/lawyer-attorney-1529187.html

The "Discharge Order" is an order by the Bankruptcy Court that releases you from any obligation to pay all discharged debts. Discharge eliminates any personal liability for debts incurred before filing bankruptcy and forever prevents creditors from trying to collects on those discharged debts. The only exception, however, is debts that cannot be discharged.

NON-DISCHARGEABLE DEBTS:
- "Non-dischargeable debts" are debts that you are still obligated to pay even if you file for bankruptcy.
- Some debts are automatically non-dischargeable, meaning that the court does not have to make any determination on the issue of dischargeability, and others are declared non-dischargeable by the court after a creditor files an objection to the discharge.

Some examples of Automatically Non-dischargeable Debts:
1. Alimony, maintenance and child-support
2. Student Loans. See Bankruptcy and Student Loans.
3. Taxes are generally non-dischargeable. - Some taxes may be dischargeable. However, bankruptcy law regarding taxes is very complicated. If you owe taxes you will need legal representation by a Jacksonville Bankruptcy Attorney.
4. Fines & Penalties owed to governmental units. - For example, parking tickets and court ordered restitution.
5. Debts incurred through drunk driving.

Debts that MAY be Non-dischargeable:
1. Debts incurred through fraud or false financial statements. - For example, lying about your income on a loan application.
2. Debts for willful and malicious injury to another or to property.
3. Property settlements.

Continue reading " Jacksonville Bankruptcy Attorney Explains Dischargeable vs. Non-dischargeable Debts " »

A Palm Beach County developer whose construction of a new home in Riviera Beach for a single father suffering from cancer was featured on the popular ABC-TV series Extreme Makeover: Home Edition has filed for Chapter 7 bankruptcy.

In February of 2006, Majestic Custom Homes built a 2,300 sq. ft. home for Dunstan Rainford, a 43-year-old single father with lymphatic cancer whose roof had been ripped away by Hurricane Wilma. The building of the home was featured on Extreme Makeover: Home Edition during the 2006 season.

Rainford died seven months after the completion of the home, which is now owned by his relatives.

JPG Enterprises, Inc., doing business as Majestic Custom Homes, filed for Chapter 7 bankruptcy, listing more than $7 million in liabilities and $1.6 million in assets. The company, headed by president John Paul George, was incorporated in 1984 and built custom homes in Indian River, Palm Beach, Sarasota and St. Lucie counties.

Majestic’s bankruptcy filing showed that among the company’s liabilities are significant sums due for unfulfilled home construction contracts, including some on homes that have already been foreclosed on by lenders.

The Florida housing market meltdown has caused a number of construction-related businesses to file Chapter 7 or Chapter 11 bankruptcy in Florida. If you are the owner of a financially troubled Florida business and want more information about the business bankruptcy process in Florida, consult a Florida bankruptcy attorney.

Continue reading " Palm Beach County Developer Featured on Extreme Makeover: Home Edition Files Chapter 7 Bankruptcy " »

An appeals court in Philadelphia overturned an earlier decision authorizing Visteon to end health care and life insurance benefits for 2,100 retirees.

Visteon, the former auto parts supplier subsidiary of Ford Motor Co., filed for Chapter 11 bankruptcy in May 2009 and is currently poised to exit bankruptcy, even though that exit is being protested by shareholders, bondholders and banks that say the company will be able to profit quickly from the resurgence in the American auto industry.

The 3rd U.S. Circuit Court of Appeals in Philadelphia overturned decisions by a bankruptcy judge and a district court judge that allowed Visteon to terminate health care benefits for retirees. The appeals court said that lawmakers had enacted special safeguards for retirees and that Visteon had disregarded those safeguards when it terminated the benefits.

Visteon had argued that the cost of retiree health care benefits was a “crippling financial and competitive burden.” However, the appeals court said that this argument was no substitute for the violating special bankruptcy protections, and reversed the earlier decisions.

The court ordered Visteon to reinstate the benefits to retirees immediately. It also ruled that any future modifications must be negotiated with the union representing the retirees.

Continue reading " Appeals Court Reverses Decision Letting Visteon Cut Off Retiree Health Benefits " »

A recent New York Times article focused on the rising number of wealthy people choosing strategic default – walking away – as a foreclosure strategy, treating their home mortgage more like a poor investment in need of divestment.

According to an analysis done for the Times by CoreLogic, a real estate analytics firm, more than one in seven homeowners who have loans that are in excess of $1 million are seriously delinquent on their mortgages. This compares with one in 12 mortgage holders whose loans are worth less than $1 million.

The Times concludes that the rich are choosing to dump their properties like any other investment that has gone sour.

One example was Los Altos, California, where five properties with unpaid mortgages of more than $1 million are up for foreclosure auction. The usual rate used to be around one property every month.

The Times also noted that the delinquency rate on investment homes is now 23 percent on those with mortgages in excess of a million dollars. The rate is 10 percent for investment homes that have mortgage debt under one million dollars.

Continue reading " Jacksonville Foreclosure Attorney Notes More Wealthy People Choosing Strategic Default as Foreclosure Strategy " »

According to Foreclosure Deals, an online foreclosed property for sale listing service, approximately 31 percent of home sales in the first three months of 2010 were foreclosure properties.

Florida foreclosures were a little higher – 33 percent of home sales in the first quarter were foreclosures.

A total of 232,950 foreclosure properties were sold during the first three months of the year, down 33 percent from the total number of foreclosed homes sold during the same period one year ago. Analysts at Foreclosure Deals believe that the new figures reflect the shrinking supply of foreclosure homes for sale and an increase in the number of investors looking for good deals.

Investors have been attracted not only because of the large number of available foreclosure properties, but also by falling prices on those foreclosures. Foreclosure Deals reports that the price of a foreclosure was on average 27 percent lower than the price of a traditional sale home.

The website reported that 19 percent of all residential sales during the first three months of 2010 were bank-owned and REO properties, with an average discount of 34 percent below market value. Homes in default – or pre-foreclosure homes – accounted for 12 percent of sales. Nationally, the average discount on a foreclosure home has increased from 21 percent to 27 percent in the last four years.

Continue reading " Foreclosures Made Up One-Third of Home Sales in First Quarter " »

Floridians who have been bearing the often unbearable pressures of being in debt are finding that there are several important benefits to filing Florida bankruptcy, including:

No more creditor harassment. Once bankruptcy has been filed, creditors are prohibited from any type of communication with you – phone calls, letters, emails – demanding payment. Even if it turns out that some of your debts are not dischargeable in bankruptcy, those creditors are still barred from contacting you under the law. If they do, you should notify your bankruptcy attorney immediately to get it stopped. Creditors may not pursue you following the discharge of your bankruptcy.

Stop foreclosure. Filing bankruptcy can be one of the best things a homeowner can do to save their home. If you are in the foreclosure process, a bankruptcy filing temporarily stops your lender from proceeding. Filing bankruptcy may even help you save your home, since most of your consumer debt will be discharged and you may then have the income necessary to catch up on your mortgage payments.

Eliminate debt. A bankruptcy filing eliminates unsecured debt, which includes credit card debt, medical bills and any personal loans not secured by property or other assets. Once this debt is eliminated, you will have more income to put toward your mortgage or car payments.

Approximately 3.15 percent of all Florida properties are in foreclosure, the third highest rate in the nation behind Nevada and Arizona, according to the latest foreclosure report from RealtyTrac, an online foreclosure marketplace.

Nationally, one in 78 homes received a foreclosure notice in the first half of 2010, up 8 percent from the same period one year ago. RealtyTrac reported that more than 1.6 million American homes received a foreclosure notice during the first six months of the year, and that at the current pace, more than three million properties will be in foreclosure by the end of the year.

For the third straight month, foreclosure filings declined in June by 3 percent, and are down 7 percent from June of 2009. Even with that decline, June was the 16th straight month of more than 300,000 foreclosure filings.

A report on U.S. foreclosures by Capital Economics, an independent macroeconomics firm, showed that a double dip in the U.S. housing market is beginning to materialize. The report noted that for every one house currently on the market, there are two waiting to be sold – reinforcing the prediction of a large “shadow inventory” of foreclosures.

Florida is second only to California in the highest number of foreclosures, with 277,000 properties in some phase of the foreclosure process statewide.

Continue reading " Florida Third Nationally in Rate of Foreclosures " »

Last month, the Board of Governors of the Federal Reserve System approved the final rules for the implementation of the Credit Card Accountability Responsibility and Disclosure Act (CARD) of 2009 that takes place on August 22, 2010.

This Act is aimed at protecting consumers against excessive late fees and other charges that credit card companies have profited from in the past. Some of the new consumer protections include:

• Late payment charges cannot exceed $25 for a monthly credit card bill.
• Over-the-limit fees cannot exceed the amount of the overage. For example, if you go over your credit limit by $25, the credit card company cannot assess an over-the-limit penalty of more than $25.
• Abolishment of the “inactivity fee” that some credit card companies charged users, penalizing them for not using their cards.
• Abolishment of multiple penalty fees for one late payment.

In addition the Board detailed which fees are not considered to be penalty fees, including:

• Fees for cash advances
• Fees for balance transfers
• Fees for foreign transactions
• Annual fees for use of credit (unless the fee is based on account usage, when it would then be considered a penalty fee)
• Fees for expedited payments
• Fees for reissuing a lost or stolen card
• Insurance, debt suspension or debt cancellation fees
• Fees for optional services

If you are having problems paying your credit card bills or have other financial pressures that are creating havoc in your life, contact a Jacksonville bankruptcy attorney.

Riviera Holdings Corp. RVHL.PK, the owner of Riviera Hotel & Casino, located on the northern strip of Las Vegas, filed for bankruptcy protection under a Chapter 11 petition. The decision to file for bankruptcy was part of a pre-negotiated deal that will transfer ownership of the company, Riviera Holdings, to senior secured lenders.

According to court papers, Riviera attributed its financial downfall to the slowdown in the economy and recent developments along the Las Vegas strip. During a period of economic boom, many properties of the north part of the strip were either torn down or sold to make way for new, high-end resorts. However, because of the turn in the state of the economy, the construction on many of the new projects were either halted or did not start at all.

In its Chapter 11 petition, the company listed both assets and liabilities in the $100 million-$500 million range. Riviera, who also owns a casino in Colorado, said recovery for its current shareholders was highly unlikely.

A Chapter 11 Bankruptcy is another type of consumer bankruptcy that is a reorganization used mainly by businesses or individuals who are involved in large businesses.

As of July 1, unemployed homeowners who are behind on their mortgage payments and facing possible foreclosure can apply for relief from the Home Affordable Unemployment Program (HAUP).

HAUP assists homeowners with obtaining a forebearance from their lenders for monthly mortgage payments, either reducing or suspending payments temporarily – up to three months or more, depending on regulatory guidelines. Under this initiative announced in March, homeowners who qualify can have their mortgage payments reduced to 31 percent of their monthly household income or, in some cases, suspended for a period of three months or until they find a new job, whichever is shorter.

To qualify for HAUP assistance, homeowners must meet the following guidelines:

• Have a first-lien mortgage that was originated on or before Jan. 1, 2009;


• Have an unpaid principal balance on a single-family, owner-occupied residence that is equal to or less than $729,750;


• Have a mortgage that is in default or in imminent default.

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

Former Pittsburgh Steelers offensive lineman Dermontti Dawson joined former Jacksonville Jaguars quarterback Mark Brunell in filing for bankruptcy this month.

And even though the bankruptcy routes they are taking are different – Brunell filed for Chapter 11 business bankruptcy and Dermontti has filed Chapter 7 liquidation bankruptcy – they got there the same way: by personally guaranteeing loans on real estate deals that went bad.

Dermontti filed Chapter 7 bankruptcy in Lexington, Kentucky, where court documents showed he has assets of $1.42 million and debts of $69.66 million. Dermontti retired from the NFL in 2001, after playing his entire 13-year career with the Steelers, where he was the team’s highest paid offensive lineman at $4.2 million per year.

Dermontti’s largest debt claims include several million dollars owed to Fifth Third Bank of Lexington as a result of his ownership interest in several real estate development businesses. The bank had recently won a judgment against one of the businesses for defaulting on a $3.4 million loan.

Brunell’s Chapter 11 bankruptcy documents list assets of $5.5 million and debts of $24.7 million, most of which are personal loan guarantees he provided on commercial loans to several limited liability companies in which he had an ownership interest.

The Middle District of Florida U.S. Bankruptcy Court – with divisions in Jacksonville, Orlando, Tampa and Fort Myers – is the second busiest bankruptcy court in the nation with more than 64,000 bankruptcy cases filed there in the past year. Only the Los Angeles district ranks higher for bankruptcy filings.

At a recent meeting of the Jacksonville Bankruptcy Bar Association, Jacksonville Division Chief Bankruptcy Court Judge Paul Glenn said that while the economy is recovering slowly, bankruptcy filings in Florida could still grow because of the Gulf oil spill and the impact the current European economic downturn might have on the state’s international and trade-related businesses.

The judge said that total business bankruptcy filings – including Chapter 7 liquidation and Chapter 11 reorganization – totaled 3,210 in the Middle District of Florida courts in the past year. He also noted that 23 percent of Florida mortgages are currently in the process of foreclosure.

Approximately 10 million Florida residents are served by the Middle District of Florida U.S. Bankruptcy Court, which covers 35 Florida counties. The four divisions have a total of nine judges; at the current rate of 64,000 cases per year, the average caseload per judge is a staggering 7,000.

When filing a Chapter 7 Bankruptcy in the Middle District of Florida, debtors are entitled to several exemptions that allow them to keep assets out of the reach of the trustee. One of those exemptions is the Homestead exemption under Article X, Section 4(a) of the Florida Constitution which allows debtors to exempt the full amount of their homestead property from the bankruptcy estate. Under one of the newer additions to the bankruptcy law, referred to as the “wildcard exemption”, debtors are able to exempt up to $4,000 of personal property from the bankruptcy estate.

The relationship of these two exemptions to each other is important for debtors to understand. The reason is that if you use one of them you are not entitled to use the other at the same time. For instance, if you own your home and it is your homestead you must claim the homestead exemption when you file for a Chapter 7 bankruptcy in the Middle District of Florida if you wish to exempt your property from the bankruptcy estate and creditors. To that end, you will only be entitled to $1,000 in personal property exemptions under the Florida Constitution Article X, Section 4(b). However, if you are behind on your home mortgage, have no hope of reinstating your mortgage or do not wish to, you can surrender your house, discharge your mortgage, and take advantage of the “wildcard exemption” to protect up to $4,000 of your personal property, including a vehicle.

An important aspect of this exemption interplay to remember in the Middle District of Florida, Jacksonville Division, is that the Court has decided once you claim the Homestead Exemption you cannot amend your petition prior to the discharge and claim the “wildcard exemption”. You must make up your mind prior to filing the petition which exemption you wish to use. This is where the advice of a Jacksonville Bankruptcy Attorney can prove invaluable. If you wish to discuss filing for Bankruptcy in Florida contact us at Wood, Atter, & Wolf, P.A.

For the second straight week in a row, mortgage rates have dropped to their lowest point in 5 decades. However, the housing market and broader economy may not benefit as much as you would think because many people still do not qualify for a new mortgage or they have already taken advantage of this year's low rates.

Mortgage company, Freddie Mac, reported the average rate on their 30-year fixed mortgage dropped to 4.57% - this is the lowest rate Freddie Mac has seen since it began tracking rates in 1971. However, these low rates do not seem to be helping the rate of home sales. Due to the expiration of federal tax credits for home buyers in April, the housing market has slowed. Most people have already taken advantage of the lower rates this year so buying a new home or refinancing might not be worth the cost. Still, millions of Americans are unable to take advantage of the low rates. Many home owners have seen the value of their home decrease drastically and have little or no equity. Many Americans also have poor credit scores or lack steady income to qualify for refinancing or a mortgage.

Although there have been some positive changes in the housing market there remains an increasing number of defaults in Northeast Florida on mortgages.

Continue reading " Jacksonville Foreclosure Attorney Discusses The Recent Decline In National Mortgage Rates " »

Declaring bankruptcy and defaulting on bills or mortgages can have a tremendous impact on your credit score. Your credit history, credit reports and credit scores are all based on how your debt payment history. Delinquent debts will stick around for seven years from the date of their delinquency. The most impressive thing one can do for a lender is pretty simple - pay what you owe! Here are starting off points to help rebuild your credit (Note: assume a FICO credit score from 550-600 or a VantageScore credit score ranging from 601-700):

1. Begin with a passbook savings loan. - You essentially borrow your own money at a very low interest rate. Your repayments will appear as an installment loan on your credit report. However, you should always check with your lender to ensure that the repayments will be reported to the credit bureaus. Other installment loans that can help your credit are loans for furniture or other large items and car loans. That is, if you are in the market and can afford to purchase a new car. Try to get loans from a bank or credit union as opposed to finance company loans or payday loans.

2. Apply for a secured credit card. These are similar to passbook loans in that you must deposit the amount of your credit limit with the issuing bank. After your have made several on-time payments for a specified duration, many banks will upgrade you to an unsecured credit card.

It is important to note that if had a debt forgiven for any amount larger than $600, that forgiven amount will be reported to the IRS and will show up on a Form 1099 as income later this year. For example, if you settled a $4000 debt for $2000, you will be required to include the $2000 from the 1099 as taxable income on your next tax return.

Rebuilding your credit can be easier than you may think. By not living outside your means and taking on new debt that is sure to be paid off, you can rebuild your credit score and no longer live under a dark, looming cloud. You should contact a Bankruptcy Attorney to discuss your decision of declaring bankruptcy and what, if any, other alternatives may be available to you. A Bankruptcy Attorney can also help you draft a financial plan or budget to help get you out of debt.

Federal economic recovery funds are helping the city of Jacksonville and other Florida cities buy foreclosed properties, fix them up and then put them back on the market.

Hit hard by the foreclosure crisis, Jacksonville is one of several cities benefitting from the U. S. Department of Housing and Urban Development’s Neighborhood Stabilization Program. The City of Jacksonville received over $26 million for use in Duval County.

According to a March 31, 2010 Progress Report produced by the City of Jacksonville Housing and Neighborhoods Department, the funds have already been committed to projects identified over the past two years.

Jacksonville has $10.5 million of the $26 million budgeted for the acquisition, renovation and resale of 72 single family homes, $8 million for multi-family homes (a 52-unit complex formerly known as the Renaissance Village Apartments will be purchased and renovated to house low income residents), $2.5 million for demolition and clearance, $1 million for redevelopment, $1 million for financing tied to property acquisitions, $500,000 for the establishment of a land banking entity to temporarily manage vacant land and $2.6 million for planning and administration.

According to the report, the City is no longer accepting applications for consideration as all HUD funds have been committed to projects already identified. A total of 10 lenders, 11 Jacksonville property developers and over 100 contractors are participating in the Jacksonville NSP program.

For more information on Jacksonville’s Neighborhood Stabilization Program, visit the NSP section of the city’s website.

Lending giant Fannie Mae announced in late June that homeowners who walk away from their mortgages – a process known as “strategic default” – would not only be barred from future loans for seven years from Fannie Mae and Freddie Mac, but would also be pursued for deficiency judgments.

In Florida, if a homeowner “walks away” from a delinquent mortgage, a lender is entitled to pursue a deficiency judgment against them for the amount between the mortgage total and what the home eventually sold for – so if you owe $400,000 and walk away, and the home is sold for $250,000, a lender could seek a deficiency judgment for $150,000 against you.

A new research report from Experian and consulting firm Oliver Wyman of 25 million consumer credit files showed that even people with high credit scores are choosing to strategically default on underwater mortgages. The study, which tracked 2009 strategic defaults, found that 28 percent of those with high credit scores had a strategic default as compared with 18 percent for the overall population in the sample group.

Experian estimates that approximately 19 percent of all 2009 mortgage defaults were strategic. The study confirmed that the hardest hit foreclosure states – particularly Florida and California – had a higher rate of strategic default than the national average.

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 Obama administration gave the green light – in the form of $418 million -- to the Florida Housing Finance Agency’s plan to assist up to 12,000 homeowners through its new Mortgage Intervention Strategy program.

The new program will help unemployed and underemployed Florida homeowners make up to nine months of mortgage payments; in addition, the agency will work with lenders to forgive up to another nine months of payments.

The funds are part of the federal government’s $1.5 billion Hardest Hit program – the state is one of five states to have repaid financial bailout money allocated to it to help stem Florida foreclosures. In the first quarter of 2010, foreclosed properties made up nearly 40 percent of Florida home sales.

In addition, Florida has a higher rate of unemployment, which adds to the distress many homeowners are feeling in trying to pay their mortgage. The May unemployment rate in Florida was 11.7 percent, which was over 17 percent higher than the national unemployment rate of 9.7 percent.

The FHFA said that some Florida homeowners might also be eligible for a $25,000 principal reduction that would help them qualify for a loan modification. The agency said it has targeted unemployed and underemployed Florida homeowners because they are at the highest risk for foreclosure.

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

If you are among the many Florida residents who have filed for Chapter 7 bankruptcy or Chapter 13 bankruptcy – or a Florida business that has filed for Chapter 11 reorganization -- you are no doubt aware that overdue taxes are not dischargeable in bankruptcy. You still need to pay any back taxes owed to the state, even if you are going through the Florida bankruptcy process.

Now for some good news: the state has just instituted a new amnesty program that will cut the interest and waive any penalties on past due state taxes. The amnesty program runs through September 30, 2010.

According to the Florida Department of Revenue, all taxes that it administers qualify for the amnesty program with the exception of overdue unemployment taxes.

The tax amnesty applies to both businesses and individuals, although it may be more beneficial to business since Florida does not have a state income tax. However, anyone who has overdue sales or use taxes can use the amnesty period to catch up without having to pay the full amount.

For past due taxes that the Department of Revenue has already billed you for, the interest rate will be reduced by 25 percent. For any taxes due that the Department does not know about, the interest rate will be reduced by 50 percent and any penalty will be waived.

For all the details on the Florida tax amnesty program, click here.

According to the American Bankruptcy Institute, consumer bankruptcy filings in the first six months of 2010 rose 14 percent from the same period one year ago, and are now the highest on record since the bankruptcy laws were revised in 2005 when Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act.

From January 1 through June 20, 2010, consumer bankruptcy filings in the U.S. stood at a total of 770,117. For the month of June, bankruptcy filings totaled 126,270, up 8.5 percent from June of 2009. A small silver lining: the total number of filings for June was down 7.8 percent from last month.

The ABI website provided quarterly bankruptcy filing statistics by state only through the first quarter of 2010; Florida bankruptcy filings stood at 26,404 for the first quarter of 2010, up 22 percent from the same period one year ago, when filings totaled 20,701. Florida is second only to California for the highest number of combined consumer and business bankruptcy filings.

In a press announcement on the latest bankruptcy filing statistics, ABI Executive Director Samuel J. Gerdano said that his organization anticipates there will be over 1.6 million new bankruptcy filings by the end of 2010.

As young adults graduate from college or grad school, some important life lessons are in order. One of the hardest life lessons to learn is how to behave rationally – know your limits. This task may be especially hard for recent graduates as they experience a transition from student-life to adult realities. Student loans come due, employment at higher pay jobs become available and bigger purchases seem more feasible. However, recent grads need to know how to manage their finances to avoid burying themselves under massive piles of debt.

An article published by CNNMoney.com offered 3 pieces of advice to recent grads:

1. Your Career: Listen to your Adversaries.
In business dealings, the people with whom you often butt heads are more than likely the same people who have the greatest insight into you. If someone knows exactly how to get under your skin, he or she has a good sense of your personal faults. Also, it is wise to listen to a person’s point of view that you might not entirely agree with. Being able to listen to other points of view can give you some insight into how others might see or deal with a situation and give you a leg up on the competition.
2. Your Investments: Buy and Hold.
Do not believe that you can conquer the stock market. The wisest investment plan for a recent grad is a buy-and-hold strategy. You’ll make more money in the long run by minimizing taxes and trading fees.
3. Your Love Life: Understand the Odds.
If you have an argument with your spouse or fiancé, about half the time you are in wrong. Grasp this fact and understand it – it will keep you from a costly divorce. To read more about this topic see Financial advice to recent grads.

Knowing your limits is very important for young adults – do not live outside your means. The younger you can learn your limits; the better off you will be in the future. It is important to note that if you declare bankruptcy, the obligation to pay off your student loans does not go away; unless under extremely rare circumstances that is usually never recognized by the courts.

Foreclosing on your home may get you out of a deeply underwater mortgage, but there are some disadvantages. Your credit score is shot and it becomes more difficult if not impossible at times to obtain credit. It takes more than on-time bill payment to raise your FICO score and eventually purchase a new home. The way you default on your mortgage may depend on how long you must wait to purchase a new residence. Generally, it takes two to five years to purchase a new home for people who defaulted becomes of economic hardship such as job loss or divorce. However, walk-away defaulters face double the time. Jay Brinkmann, chief economist for the Mortgage Bankers Association, said it could take walk-aways well over seven or eight years before they are able to obtain a mortgage and purchase a home again. Brinkmann states that credit scores are only one component in the overall credit decision. A repaired credit score is highly unlikely to remove the blemish of a walk-away default because these credit scores are not good indicators of a person’s willingness to continue to pay their mortgage.

Strategic decisions to default will work against you, claims Bill Merrell of the National Association of Review Appraiser and Mortgage Underwriters. Banks are far more lenient on a person who defaulted because of reasons beyond his or her control. However, getting a loan is not impossible. Banks want to make interest payments so gambling with a walk-away might be worth the risk to banks. But, lenders may require more money up front—some as much as 30% or more down—and charge higher interest rates than those with similar credit scores. To read more on this topic see Walk-away defaulters seen in negative light by banks.

Defaulting on your mortgage and foreclosing your home is never an easy decision to make. The reasons for default play a critical role in your future purchases and credit line. Contact a Foreclosure and Bankruptcy Attorney to discuss your situation and the best available routes for you to pursue.

As if foreclosing on your home was not bad enough, some former homeowners are finding themselves still on the hook for their mortgage. Deficiency judgments occur when there is a difference between what former homeowners owed on their mortgage and what the bank sold the home for at auction. Most people are under the opinion that they negotiated the deficiency away. However, people can find themselves in this situation even when the bank has approved them to sell their home for less that it was worth. Because of the falling home prices and unforeseen circumstances—unemployment or job transfers—people are being forced to short sale or foreclose on their home and, as a result, are getting caught up in deficiency judgments.

Here is where the complication occurs—releasing title to a home does not necessarily end the debt. Generally, a mortgage has two-parts: a pledge of collateral, represented by the home, and a promise to pay off the loan. Foreclosing on your property may result in you giving up the collateral (your home) without releasing you from your liability to repay the debt under the promissory notes.

Whether banks can and will pursue deficiency judgments depend on a wide array of factors, including but not limited to: what state the borrower lives in and whether there is a second mortgage or other liens present. In the case of foreclosures, lenders can pursue deficiencies in more than 30 states; among these states are Florida, New York and Texas. California, for example, is a non-recourse state and does not allow deficiencies judgments. However, even in California, if the original loan was refinanced, some or all of it may be subject to claims. Another startling aspect of deficiencies is that the judgments do not have to be obtained immediately—lenders can wait until borrowers have regained financial stability and then swoop in. In Florida, the bank can wait up to five years to file. Once the court grants a judgment, the lender has 20 years to collect, with interest. To read more on this topic see Deficiency Judgments.

If you are pursuing a short sale, be sure you have legal representation. An attorney can ask the bank to release you from any further obligations. Also, if you have any doubts about the risks that are associated with borrowing seek legal advice.