Bankruptcy and Foreclosure Attorney Blog

Many times debtors wish to keep a credit card or another form of debt outside of a bankruptcy. In both consumer chapters, all debt and assets must be disclosed and listed in the debtors petition and schedules. In fact the Trustee will ask each debtor under oath and penalty of perjury if everything is listed.

In the eyes of the Trustee, it is not fair that one particular creditor in the same class (unsecured) is paid more (as a %) than another creditor in the same class. For example, if debtor wants to list all credit cards except for credit card A and B, its not fair that they get paid more than the credit cards listed in the petition and schedules. Credit cards are treated as unsecured debts and they are basically last in the food chain when it comes to getting any type of distribution.

However, in the middle district of Florida, first priority mortgages on primary residences may be left outside of the Chapter 13 plan if they are current. This will help lower the overall Chapter 13 plan payment because the Trustee gets a 10% fee for all debt included in the plan.

Continue reading " Can I leave out Certain debts from Bankruptcy Trustee " »

For the most part, the answer to this question is no. Banks are not required to give struggling customers loan modifications. Many economic experts attribute much of the US economic recession to the banks unwillingness to cooperate and work with homeowners who are struggling with mortgage payments.

There are federal programs that require banks to "consider" customers for modifications but there are very few government programs that force banks to give modifications. This is a major problem at this point especially when the country is trying to recover from one of its deepest recessions ever.

Continue reading " Are Banks Required to Give Me a Loan Modification on my Florida Home? " »

A qualified written request (QWR) is a a request that seeks general information about the life of an account or loan. Federal Law defines "Qualified written request" as:

a qualified written request shall be a written correspondence, other than notice on a payment coupon or other payment medium supplied by the servicer, that—

(i) includes, or otherwise enables the servicer to identify, the name and account of the borrower; and

(ii) includes a statement of the reasons for the belief of the borrower, to the extent applicable, that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

The lender must respond to the QWR request within a certain period of time or else it could be held liable for failing to respond.

Many times, lenders send QWR responses back that differ from the documents that are actually filed in foreclosure cases.

Continue reading " What is a QWR? What is the Purpose for a QWR? " »

This depends on several factors. How much debt do you have? What kind of debt is it? Do you work? How much income are you bringing in? What is the source of your income? Are you behind on payments? Are you facing lawsuits and/or garnishments? Have you ever filed bankruptcy? How long have you been in Florida? Are you court ordered to pay some of the debt?

These are just a few of the questions and issues you can expect to be addressed during an initial consultation with a Florida bankruptcy attorney. Once it is determined that you should file for bankruptcy releif, he next step is determining when and what chapter to file. Timing is important in filing for bankruptcy.

There may be an immediate need to file or you may be able to wait a few months before it being the right time to file. The point is you should speak with an experienced bankruptcy attorney before deciding on whether or not to file for bankruptcy relief.

Continue reading " Should I file a Florida Bankruptcy? " »

Many times debtors are not eligible to file for a particular bankruptcy chapter either because they make too much money for a 7 or they have had a recent bankruptcy discharge. The idea behind the BAPCA amendment in 2005 is that it was designed to prevent abuse of the bankruptcy system.

Many credit card companies and banks were behind the BAPCA legislation. If a debtor does not qualify for 7 or 13, then he or she may have to turn to chapter a 11 or tough it out until eligible for a chapter 7 or 13 again. If a debtor did not receive a discharge in bankruptcy, then the time requirements for filing again or not applicable unless the case was dismissed for fraud or with prejudice for any reason.

Chapter 11 is usually reserved for high net worth individuals and businesses looking to restructure. Chapter 11s are expensive and its not unusual for a debtor to run a ten thousand dollar bill in attorneys fees.

Continue reading " What if I do not qualify for a chapter 7 or chapter 13 Florida Bankruptcy? " »

Forged foreclosure paperwork has not only affected homeowners, but the discovery of the potential fraud has also slowed foreclosure filings. Florida Courts now seem to be at the mercy of the banks due to the loss of revenue foreclosure filing fees generated. At one point in time, Foreclosures were more than 50 percent of the court system’s funding.

The Florida Legislature has recently approved a $54 million dollar loan to help the Courts through the fiscal year 2011-2012. The state is estimating an upturn in foreclosure filings toward the end of this year.

If you anticipate a foreclosure, or if foreclosure has already been filed, contact a Florida Foreclosure attorney to determine if your case involves faulty paperwork. Don’t overlook the obvious.

Continue reading " Florida Foreclosure Courts and Funding " »

A personal injury cause of action or a potential cause of action is considered property of the debtor's bankruptcy estate. It does not matter whether or not a lawsuit has been filed before the bankruptcy was filed. If the accident occurred pre-petition, then for bankruptcy purposes, that is a potential asset that must be disclosed in the debtor's petition and schedules.

If the accident occurred after the bankruptcy was filed, and the debtor filed a chapter 7 bankruptcy, this is not a pre-petition action and any proeeds collected are not part of the bankruptcy estate.

However, if the debtor is filing a chapter 13 bankruptcy, any wages, income or proceeds received after the bankruptcy is filed is considered property of the esate for the length of the bankruptcy plan. There can be many timing issues when dealing with a bankrutpcy and a civil action at the same time. You should consult with an attorney before committing yourself to either one.

Continue reading " What if I have a Personal Injury Cause of Action Before I file my Florida Bankruptcy? " »

The short answer is no. Student loans are not dischargeable in a bankruptcy. There are rare instances where it can be done, but the debtor must show an extreme hardship as to why they should be discharged or forgiven.

For example, the few instances where someone is able to have student loans discharged is because the debtor is and forever will be permanently disabled and unable to work. Another example is if the debtor has to financially support minor children but does not have the physical or mental capacity to adequately provide the support for these children. As you can tell, these are extreme circumstances.

Therefore, it is better to know going in that you most likely will not be able to have your student loans discharged. It also makes a difference whether or not the loans are federally or privately backed. You are less likely to have a federally backed student loan debt discharged than a private loan.

Continue reading " Are student loans dischargeable in a Florida Bankruptcy? " »

Without getting into too much detail, the short answer is no. Financial institutions that received bailout money are only required to "consider" customers for modifications. Current law does not force banks to enter into modifications with struggling homeowners. Very few customers actually are put in a permanent modification.

Some loans are modified by rolling the arrears to the back of the loan but the banks are not extending the length of the loan. Therefore, in many cases, homeowners are approved for the modification but their monthly payment goes up! In some instances, customers are put on short term or trial modifications. In some cases, if the customer makes it through this trial period, then they will be put on a permanent modification.

However, in many instances, the customer is not rewarded by completing the trial period and is denied permanent modification. The loan modification process can be very frustrating and time demanding. Because the program is voluntary, its almost become a complete waste of time.

Continue reading " Are Banks Required to give Florida Homeowner's Modifications? " »

It is an unsettled and highly debated area of bankruptcy law. Should a debtor who is willing to surrender a home or property in a bankruptcy be liable for post filing homeowner association assessments? As of right now, the answer is yes.

Chapter 7 bankruptcy discharges unsecured debts that were incurred by the Debtor pre-filing. Any debts that are incurred post filing, the debtor is responsible for. Assessments incurred post filing are among these debts. So, even though the debtor intends on surrendering the home, until the title is out of the debtor(s) name, they will be billed for the assessments.

There may be ways to have the Trustee sell the home off quicker, but that means that any occupants muct vacate the home faster also. The sooner the deed and title is out of the debtor's name, the less they will be responsible for in HOA or condo fees.

Continue reading " Florida Bankruptcy and My HOA " »

The answer depends. Most debtors who have to convert, convert from a Chapter 13 to a Chapter 7. What is the primary reason for this? It usually can be attributed to Debtors not being able to make their payments or fall behind on their plan payments and cannot catch up.

Sometimes, it is a result of a debtor losing a source of income. In any event, a case can be converted from a chapter 13 to a chapter 7. However, any secured assets may be lost or foreclosed upon if they are not brought current by the time conversion is complete. It is not unusual for a case to be converted from a chapter 13 to a chapter 11.

This usually needs to be done if the debtor has debts that exceed the limits for chapter 13 and the debtor does not qualify under chapter 7. It is better to have a case converted from one chapter to the next as opposed to having the original case dimissed. For one, the conversion filing fee is much less than a filing fee for filing an entirely new case. Second, there automatic stay limitations if a debtor has had a recent case dismissed

Continue reading " Can I convert my Florida bankruptcy from one chapter to another? " »

Many times, homeowners are looking for loan modifications or principal reductions through a bankruptcy. In a chapter 7, the debtor cannot strip liens off real property. Unfortunately, banks are not forced to offer loan modifications in bankruptcy, period. In a chapter 13, second liens are subject to strip offs and "cram downs" may be allowed for investment property, but even then, loan modifications are not required.

The National Association of Consumer Bankruptcy Attorneys is in the process of proposing new legislation that would force banks into a principal reduction compared to the market value of the property. Once the debtor completes the bankruptcy, the new value of the loan should equate with the real value of the property.

The debtor must file a chapter 13 bankruptcy to restructure the home loan. If you have questions or concerns about bankruptcy or modifications, you should contact an experienced bankruptcy attorney.

Continue reading " Is Principal Reduction Available in a Florida Bankruptcy? " »

What happens if I lose my foreclosure case?

The property will be set for sale. Once the sale occurs and title transfers you will be required to leave the premises. If you fight the foreclsoure, the idea is you should have saved enough money to put something down on a new place.

Whether or not the bank will pursue a deficiency judgment or write off the debt and send you a 1099 is a different matter. There are two ways a bank can bring the deficiency judgment against you.

First, if they reserve jurisdiction in the court which the foreclosure case is brought, the bank can file a motion after the sale date for any type of deficiency against the homeowner.

The second way a bank can bring a deficiency action is by filing a separate case against the borrower. If you fear that is an option, you can always look to filing a bankruptcy or work with the IRS on paying back any tax liability.

Continue reading " What happens if I lose my foreclosure case? " »

If the party suing me for foreclosure is not the right party, can the true owner file a foreclosure against me?

Many times cases are dismissed because the wrong party is bringing the lawsuit. Does this mean that the nightmare is all over? I get a free house? The answer is probably not. Judges will usually give the foreclosing Plaintiff at least one more chance to amend the court filings and file documents that support ownership of the note and mortgage.

However, if a fraud was committed upon the court, the Plaintiff may be banned from brining another foreclosure lawsuit against that particular homeowner/defendant and a free home is more optimistic. Again, if the rightful owner brings the foreclosure action within five years of default on the loan, then the courts will most likely allow that party to continue with the lawsuit.

Continue reading " If the party suing me for foreclosure is not the right party, can the true owner file a foreclosure against me? " »

Bank of America is being sued by its investors and were close to reaching a $8.5 billion settlement. Although that number seems high, its miniscule compared to the $220 billion actually invested for these mortgage backed securities.

Deleware's state attorney general is stepping in and wants to intervew in the case because he feels the settlement offer is too low and wants to make sure investor rights are being protected. If the judge allows the state attorney general to intervene, the AG claims he will investigate further for criminal liability. He vows he will work hand in hand with the Securities and Exchange Commission.

The lawsuit was initially brought in New York because that is where a majority of these trusts were being handled by Bank of America. However, BOA is accused of misleading investors into purchasing these mortgage backed securities and perpetrating an assortment of fraud. BOA was acting as Trustee for these trusts.

Deleware's AG feels the state should be allowed to intervene because a few of these trustes were located in Deleware.

If you want to learn more about this article, please visit Beau Biden, Delaware AG, Moves To Join Bank Of America Mortgage Deal, Signaling Concerns.

Continue reading " Deleware Attorney General Stepping in Settlement Talks Between BOA and Investors " »

If the party suing me for foreclosure is not the right party, can the true owner file a foreclosure against me?
Many times cases are dismissed because the wrong party is bringing the lawsuit. Does this mean that the nightmare is all over? I get a free house? The answer is probably not.

Judges will usually give the foreclosing Plaintiff at least one more chance to amend the court filings and file documents that support ownership of the note and mortgage. However, if a fraud was acted upon on the court, the Plaintiff may be banned from brining another foreclosure lawsuit against that particular homeowner/defendant and a free home is more optimistic.

Again, if the rightful owner brings the foreclosure action within five years of default on the loan, then the courts will most likely allow that party to continue with the lawsuit.

Continue reading " If the party suing me for foreclosure is not the right party, can the true owner file a foreclosure against me? " »

Why does the Florida foreclosure process take so long?

Florida is a judicial state when it comes to foreclosing on real property. What does this mean? It means that the lender must go through the state court system and get a judgment in order to sell your home. Many states, including Georgia, are non-judicial states. Lenders do not have to use the courts to foreclose on property. They simply have to abide newspaper notice requirements and so forth to execute the sale.

Because Florida is a judicial state and Plaintiffs must use the courts to move forward with a foreclosure, there are a lot of cases backed up and just sitting on court dockets. Many of the Florida foreclosure courts have lost much of their state funding and now are trying to figure out how to handle thousands of pending foreclosure cases with limited resources. The next six months of foreclosures will be very interesting especially with the cutbacks and the high volume of case filings.

Continue reading " Florida is a judicial state when it comes to foreclosing on real property. What does this mean? " »