Thursday, February 16, 2017
Have you ever been shocked to learn your house payment is going up because your taxes and homeowners insurance have increased, and your escrow account is now short? This happens all the time, and it requires a homeowner to either pay the shortfall in a lump sum, or make increased house payments. This can be frustrating, especially if your budget is already tight. But maintaining current insurance and keeping your real estate taxes paid up to date are vital components to home ownership. We know how hard you work for your money, and that when it comes to paying down debt you can have a lot of questions about what is best for you. For many, bankruptcy is the answer. But first it is important to find out how your loans will be treated, and this includes learning whether your mortgage company will still escrow for insurance and taxes so you don’t have to set money aside to cover those expenses.
If you file bankruptcy your lenders will be required to stop calling you to collect what is due, and cannot sue you or take other action to collect the debt. This can make it hard to communicate your needs with your lenders, and one very important need is for your mortgage company to continue to maintain an escrow account for taxes and insurance. There are few ways to handle this if you file bankruptcy:
• If your current mortgage payment includes an escrow payment, that amount should still be paid during your bankruptcy. This will allow your lender to disburse funds to your insurance agent as well as write a check to pay your property taxes.
• If your current mortgage payment does not include an escrow account, you can ask that one be established. The lender is not obligated to do this for you, but many will consider doing so.
• If you reaffirm the mortgage loan and it included an escrow payment, the reaffirmed amount will also include a portion of the payment be set aside for taxes and insurance.
Having an escrow account on your mortgage takes one more thing off your plate, while ensuring all required cost for your home are being met. Call our office for more information about bankruptcy and how your house payment, including your escrow account, will be treated during your case.
For more information about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.
Wednesday, February 15, 2017
Chapter 13 bankruptcy cases allow distressed debtors to reduce the amount of debt they owe, or eliminate it all together. Things like car and house loans can be paid through a Chapter 13 Plan and you can even cure past due mortgage payments over time rather than all at once if you file a Chapter 13. But these are not the only accounts you have that may be behind, and it is good to know how all of your important obligations are treated in Chapter 13. Unsecured debt is paid at a pro rata rate, which means this category of creditors only gets paid a percentage of their total debt. Cars are paid at their value instead of the loan balance, and house payments are brought current and maintained in a current status as long as you make your Chapter 13 Plan payments. But what about things like your cell phone bill, or your auto insurance? Can you pay the back due amount on these things without an interruption in service, or will you have to find the money to get caught up at the outset of your case?
Your auto insurance is technically an unsecured debt, but it is required for a piece of secured collateral. In a Chapter 13 bankruptcy if you do not have current insurance on your car, here are the possibilities:
• The lender may force place a policy, which will only protect them and not you, and add the premium to your loan. You will not be allowed to pay only a portion of this amount, like you can do with your actual car loan, but rather will be required to repay it in full.
• The Trustee might get a policy, and charge it to your bankruptcy for repayment. Again, this is not the best policy and will likely cost more than what you could get on your own.
• You might lose possession of your car, because without insurance coverage the lender is entitled to seek return of your vehicle in order to protect its asset.
If you are not current on your auto insurance, the best thing to do is get current before you file a bankruptcy case. That way you start out in the positive and with the reduction or elimination of other debts can stay current on your insurance needs.
If you have more questions about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.
Tuesday, February 14, 2017
There are many reasons to file for bankruptcy. It could be that you have suffered a job loss and can no longer pay all of your bills. Or, you or a family member may have been diagnosed with a medical condition that requires expensive treatments and the doctor’s bills are taking up all of your income. It is also possible that you have accumulated more credit card debt than you can repay, and are struggling to make even the minimum payments. Whatever has caused you to need to file for bankruptcy; there are some things you need to know before you file.
First, there are two chapters of bankruptcy available to consumers; Chapter 7 and Chapter 13. Chapter 7 will wipe out all of your unsecured debt like credit cards and medical expenses, and Chapter 13 will reduce the balances on what you owe to a more manageable level. Another feature unique to a Chapter 13 case is that if you are behind on your mortgage payments when you file a case, you will not be required to pay the entire mortgage arrearage amount up front. IN a Chapter 13 bankruptcy your mortgage is treated as follows:
• The back due payments are paid through the Chapter 13 Plan, which lets you pay just a portion of the amount you are behind instead of getting current on your loan all at once.
• Your regular mortgage payment can also be paid through your Chapter 13 Plan, by the Trustee or you may opt to continue making the payment on your own. If you make the payment on your own you can rest assured the mortgage company will let you know how much is needed for your escrow account as well, so you don’t fall behind on your insurance or taxes. These fees can also be paid by the Trustee, but may require more follow up between the parties to make sure they are covered.
• It is unlikely you will pay off your mortgage over the course of your Chapter 13 case, but when your case is over you should be considered current on your mortgage and have the extra funds needed to maintain the payments because many of your other debts will have been reduced or eliminated.
If you are having a hard time making your mortgage payments, and are unable to come up with a lump sum to get your mortgage loan current, consider filing a Chapter 13 bankruptcy. We can explain how it works, so you are comfortable with your decision.
If you have more questions about bankruptcy how a Chapter 13 can benefit you, contact us today at www.law-ri.com. We will help you get prepared for what comes after we file your case, and have multiple locations where we schedule appointments.
Monday, February 13, 2017
If you are considering filing for the protection of bankruptcy, you need to know the differences between the two main types of consumer cases. There is Chapter 7, which is like a liquidation of your debts and will eliminate all of your unsecured obligations. And, there is Chapter 13 which is a reorganization of your debts and will require to pay back at least a portion of your unsecured loans. Most people prefer to file a Chapter 7, because Chapter 7 cases do not take as long and for the ability to discharge unsecured debt in its entirety. But that does not mean a Chapter 13 case will not provide you with financial relief or lacks financial benefits.
Four tings to know about a Chapter 13 bankruptcy are:
• In Chapter 13 you come up with a plan of debt repayment, and then make payments to the Trustee who is administering your plan. The Trustee will then pay your creditors whatever portion of the total Chapter 13 Plan payment they are entitled to receive.
• A Chapter 13 can last up to five years, giving you an entire 60 months to repay your debts while under the protection of the bankruptcy courts.
• You are allowed to pay the value of car rather than the actual amount due, and can also pay for your car at a lower interest rate than what is called for in your auto financing contract.
• If you are able to pay off the total due under your Plan early, you may do so, and receive a discharge earlier.
The determination as to which chapter of bankruptcy you are eligible to file is made by performing the means test. The means test is a mathematical computation that must be done before you file a case, so you know what type of case to file. There are statutory guidelines in place that dictate how the means test calculation is done, and it is best to have an experienced bankruptcy attorney do this for you. Call us today to find out more about bankruptcy, and how a Chapter 13 can help you.
For more information about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.
Friday, February 10, 2017
Of the two main types of consumer bankruptcy, Chapter 7 and Chapter 13, Chapter 7 is by far and large the most preferable. A Chapter 7 case is a liquidation of debts while a Chapter 13 is a reorganization of what you owe. But not everyone is eligible to file a Chapter 7 case, and in order to find out if you qualify, you need the help of a qualified bankruptcy attorney. Complicated statutory requirements have to be met, and if you make a mistake when applying the law to your particular set of circumstances, you risk having your case dismissed. However, when you put your faith in a trusted bankruptcy attorney, you can rest easy knowing the right applications are being made in your case.
Four things to know about a Chapter 7 bankruptcy are:
• A Chapter 7 case usually takes between 3 and 6 months to complete.
• You are permitted to discharge all of your unsecured debt in a Chapter 7 case, including high interest rate credit card debt, signature loans, and medical bills.
• If you decide to keep some of your collateral, you can expect the lender to ask you to sign a reaffirmation agreement. A reaffirmation agreement is a document drawn up usually by the lender, and it outlines what you are obligated to repay. When you sign a reaffirmation agreement, you are agreeing to obligate yourself financially for the debt, even after the bankruptcy case is over. This means that if you miss a payment, the creditor can try and collect on the loan.
• Chapter 7 cases are reserved for those debtors that have a certain percentage of income as it relates to their secured debt. The determination is made by performing a complex mathematical calculation referred to as the means test. If you “pass” the means test, you will be allowed to file a Chapter 7.
The decision to file bankruptcy is not one to arrive at without serious thought. There are many considerations to take into account, including how your credit score will be impacted by filing a case. We will explain how it works to you, so you can make a choice that will allow you to straighten up your budget.
If you have more questions about bankruptcy or need help deciding what to do about overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.
Thursday, February 9, 2017
The benefit to filing for bankruptcy is that you are able to reduce or eliminate most of your debt. When you have less debt to pay each month, your paycheck goes farther and you are able to plan for the future. But not all of your debts are going to be wiped out by filing bankruptcy, so before you file a case you should know what could still be due after your case is over.
Some of the debts that will remain after you file a bankruptcy case include:
● Student loan debts: while there is case law to support discharging your student loan debt, the test is strict and can be difficult to meet for most people. So, if you are looking to get rid of your monthly student loan debt by filing for bankruptcy, you should expect a high level of scrutiny over your financial condition.
● Past due taxes: taxes typically remain due when you file for bankruptcy.
● Child support: you cannot get a discharge of your child support debt by filing for bankruptcy. Even when your case is over and most other debts are no longer due, you will still be responsible for making your child support payments.
● Certain fines and penalties: if you have certain types of judgments against you from a state court civil or criminal action, these fines and penalties will remain due after bankruptcy. A good example is any restitution you have been ordered to pay as a result of willfully damaging the property of another person. This might be from a personal injury case, or even a DUI.
It is rare to have a case where the majority of your debt is still due after the bankruptcy ends, but you should be aware of what will remain and what will be eliminated. The good news is that a large chunk of your unsecured debt, if not all of it, can be wiped out by filing bankruptcy. For most people, it is making payments to several credit cards that bust the budget each month and with those payments no longer due, real headway can be made in your finances.
If you have more questions about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.
Wednesday, February 8, 2017
In today’s world of gadgets with super high tech capabilities, it is not uncommon to conduct meetings without ever leaving the comfort of your home. More and more people are making the choice to stay in their pajamas all day and work from home, participating in discussions with co-workers and their boss via email, text, or a face time phone call. There are even some legal professionals who are moving towards a more “virtual office”, and are beginning to conduct their business online. While the benefits of the newest technological advances are great, there are still benefits to doing things the old fashioned way.
Three benefits to having an in person meeting with your bankruptcy attorney are:
• A face to face meeting helps to put you at ease during an otherwise uneasy time. When you sit down with a real person and lay out your finances for scrutiny, it becomes more personal and you can expect to receive individualized attention.
• The amount of documents that are required to be given to your attorney when your case is initiated can be great. It is better to deliver these documents in person than figure out how to scan and upload them to a portal or via email. When you meet in person with your information, you are also given the chance to ask questions you may not have thought of before hitting “send” on your keyboard to transmit things electronically.
• Putting a face to a name will let you go to Court with confidence. When you show up for your first meeting of creditors in your bankruptcy case, you can feel at a loss in the maze of the Courthouse. But if you have never met your attorney, going to Court and meeting for the first time only adds to the anxiety that comes with having to go to Court.
Our goal is to provide you high level legal representation, while maintaining a personal quality to the process. The legal arena can appear cold and confusing, but when you put your trust in a person you have met and feel comfortable with, the stress can begin to melt away.
For help with managing overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.
Tuesday, February 7, 2017
There are a lot of myths out there about how bankruptcy works, and one of the most prevalent is that you can file a case and keep all of your stuff without making payments. But the reality is that if you want to hang on to your house or car and file bankruptcy, you will have to keep making your mortgage and auto loan payments. There are a number of ways to go about maintaining payments on your obligations, and in order to figure out what is best for you, you should talk things over with a knowledgeable bankruptcy professional.
What you get to keep and what you have to give back when you file bankruptcy depends on the type of case you file, and your intentions. For example:
• In a Chapter 13 case you are allowed to make your mortgage car payments through the Chapter 13 Plan, but at a lesser amount. A Chapter 13 allows you to pay the value of your vehicle instead of the balance due. Under this type of bankruptcy, you do not sign a reaffirmation agreement for the vehicle, you simply state the value of the car and then pay that amount over the life of your bankruptcy case.
• In a Chapter 7 if you want to keep your car, you will probably have to file a reaffirmation agreement. A reaffirmation agreement is a document setting forth the terms of repayment, and acts like a new contract. The debt will remain due after the bankruptcy case is over, so if you miss a payment you should expect a call from the lender.
• As far as your house goes, if you file a Chapter 13 case you are allowed to pay the past due amount over time during your case. But in a Chapter 7 you might have to pay the total amount past due all at once before the lender will let you keep your home.
There are other debts that have to be serviced during bankruptcy also, such as a boat or motorcycle loan. You do have the option to give back collateral to the lender during your case, and doing so will relieve you of the financial obligation.
For more information about bankruptcy cases and what property you get to keep if you file, call us today or reach us online at www.law-ri.com.
Monday, February 6, 2017
Every January 1 the world is full of bright eyed and busy tailed people ready to make good on their resolutions. If you are an avid gym goer, chances are the parking lot where you work out is fuller than usual and you might even have to wait for a turn on your favorite machine. This phenomenon will probably be short lived, as most resolutions are broken before the end of January. Depending on what you have resolved to change, failing to stick by your resolution is not big deal. But if you are serious about realizing real change in a certain area, now is the time to plan.
Next to healthy living resolutions, money matters are at the top of the list of the most popular resolutions. If you plan to get your finances in order in 2017, here are some things you can do so a New Year also means new finances:
• Make a budget, and a plant to stick to the budget. Starting is the hardest part, so take it one step at a time and start by making a list of all of your monthly expenses. Then, take a look at your paystub and figure out what you bring home each month to put towards your expenses. Knowing what is due will help you determine how much you have left over for extras or to start a savings account.
• Try to pay more on your highest interest rate credit card until it is paid off, then devote that card’s regular payment to the next highest rate card. Doing this will help you to pay down debt faster.
• Shop around for the best rates when it comes to things like life and auto insurance. Or, try bundling some of your services, to get the lowest monthly fee for things like your cell phone and cable service.
There are at least a dozen more things you can do to get financially healthy, so find what works for you and put a plan in action. You might also think about filing bankruptcy, which will give you a fresh start with your money and let you start with a clean slate.
For more information about bankruptcy, call us today or reach us online at www.law-ri.com.
Friday, February 3, 2017
At this time of year thoughts start to turn towards filing taxes, as your tax documents start to trickle in from your employers, mortgage lender, student loan servicer, and others. Depending on your circumstances and tax bracket you might be entitled to a tax refund. And if you are like most people who anticipate a refund, you probably have plans for how it gets spent. But if you are too far behind on your bills to make any real headway by paying down a credit card or two with your refund, you might also be considering filing for bankruptcy. This naturally raises the concern of whether you are allowed to keep your tax refund if you file for bankruptcy.
The answer depends on what type of bankruptcy you file, and the amount of your refund. In some cases the amount will not be enough for the trustee to ask be turned over to the Bankruptcy Court, but that is not always the case. Here are some other helpful tips about how to handle your tax return if you need to file bankruptcy:
• Timing is everything, so before you file your return you might want to talk with a bankruptcy attorney.
• If you have filed a bankruptcy, but not your taxes, the Court will likely ask that you simply have your returns prepared and then sent to the tax representative on your case for filing. This will speed up the filing process, which helps move your bankruptcy case along as well.
• If you have filed taxes, received a refund, and spent the refund you can still file bankruptcy. You may have to account for how you spent the money, so keep track of your purchases or make a note of which debts you paid with the refund.
Taxes are tricky, and getting it right when you need to file bankruptcy too can be a tall order. If you have questions about how the relationship between income taxes and bankruptcies, call our office for answers.
For help with bankruptcy issues, call us today or reach us online at www.law-ri.com. We have multiple locations to serve you and can schedule a time to meet at the office most convenient for you.
Thursday, February 2, 2017
Wells Fargo has made headlines recently, and not in positive ways. The first wave of stories that came shocked us all, when we learned that employees were opening accounts for customers without their knowledge. The punishment was quick, and harsh. The bank was fined close to $200 million for these fraudulent actions and just over 5,000 people lost their jobs. The Bank’s reaction was to implement processes to avoid future incidents, while also removing hard to reach “sales goals” that may have led to some of the activity. It seemed the culmination of these bad acts came when then CEO, John Stumpf resigned.
But unfortunately for the Bank, their troubles were not over. Wells Fargo has again been denied relief from the bankruptcy court, and here is why:
• The bank was required to maintain documents that would allow it to “fail” without using public funds as a form of “bail out”.
• Banking regulators have held that Wells Fargo’s plan in this regard is deficient.
Until these problems are fixed, Wells Fargo will not be allowed to open any new branches internationally and will also be prohibited from buying any non-banking companies. The banking giant has been given until the end of March to remedy these deficiencies, and believe they can do so satisfactorily. These events have really helped to bring to light the public’s distrust of big business, and until appropriate measures are taken we may be in that place for quite a while. It seems unfair to the average American who struggles to make ends meet, that corporations are able to get away with these types of practices. In the wake of these scandals many customers pulled their accounts from Wells Fargo, and the entirety of the fallout has likely not yet been felt. The best thing to do in uncertain financial times such as these is to safeguard your money, and take steps to cut back where you can so you don’t suffer a financial downfall. We can help with this, by providing guidance on budgets, refinancing, mortgage loan modifications, debt consolidation, or by filing bankruptcy for you. Call us today for help.
For more information about how to fix your finances, call us today or reach us online at www.law-ri.com. We have multiple locations to serve you and can schedule a time to meet at the office most convenient for you.
Wednesday, February 1, 2017
In the days after the Presidential election, many Americans became worried about their money. A Trump Presidency presents many unknowns, and when those unknowns have to deal with your ability to support your family, it is natural to become concerned. We have grown accustomed to the things put in place by the Obama administration, but some of the most beneficial programs may be put at risk when Donald Trump enters the Oval Office.
One program that was helpful to many homeowners, HAMP, came to an end in 2016. And here is what many think President Trump will have to offer in its place:
• Deregulation of some financial markets, in an effort to make mortgage financing more affordable to more Americans.
• Making home ownership easier to attain for first time homebuyers.
• Ensuring there is an adequate supply of affordable homes to those that are interested in becoming a homeowner.
The end result remains to be seen, but we are all hopeful that President Trump can make good on his promise to “Make America Great Again”. This could come in the form of changing the current tax brackets, by decreasing the amount of taxes paid by lower income earners while increasing what the wealthy pay, or some other new tax scheme. There is also the chance that new businesses will reenter the American market, creating jobs and stimulating the economy. All of these things would be helpful to the American population, and could help stabilize the housing market. But in the meantime, and while we are all holding our breath to see what happens, if you need financial help now, call our office. We will let you know what options remain, and what we can do for you. Whether you need to refinance, ask for a mortgage loan modification, consolidate debt, or file for bankruptcy, we can help. Our team of experienced legal professionals has experience in all of these areas of financial need, and wants to help you find a solution today.
For more information about what you can do to save your house, call us today or reach us online at www.law-ri.com. We have multiple locations to serve you and can schedule a time to meet at the office most convenient for you.