Do’s and Don’ts of Bankruptcy

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There is nothing to fear as long as you tell the truth, the whole truth, and nothing but the truth.

DO: Be honest about all of your assets. Even if you think there is a chance that you might lose it, there are probably other ways in which your attorney can prevent that or you may need to come to terms with that possibility. If you don’t list it and the court finds out, it will be taken or the case will be dismissed for fraudulent activity.

DON’T: Transferring property to someone else before or during the filing of the bankruptcy case can be devastating. Avoid transferring property at all cost. When the court finds out, they will dismiss your case and you will be left with the overbearing debts.

DO: Provide all documentation requested by your attorney and his team. This is imperative, as without the documents requested your case stops moving forward and it can eventually force the court to dismiss your case for not having the documents required to proceed. The sooner you can get the documents to your attorney and their staff  the better.

DON’T: If talking to your creditors had helped, you wouldn’t need to file for bankruptcy. Most creditors are now just attempting to obtain information from you for their benefit. When and if they call, just provide them with your attorney’s information so that they may speak with him/her directly or a designated member in their staff.

DO: Include all of the creditors in your bankruptcy. Although bankruptcy can be a difficult thing to go through, at the end of the process there is financial freedom. Review your financial records and provide all your creditors so that you can have a fresh start at your finances again.

DON’T: Charging your credit cards with luxury items and/or trips that you never intended on paying back or were clearly over your budget, and then file for bankruptcy is a big no-no.  The court will see this as abuse and will deny your case and force you to pay back your unsecured debts. Debt might be the least of your problems if the court knows you have lied or cheated as you will have signed your bankruptcy papers under “penalty of perjury”.

DO: Ask your attorney any and all questions about your bankruptcy. Get to know your attorney before you sign with him/her. Remember that bottom dollar doesn’t always mean quality representation and vice versa.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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What is Chapter 7 Bankruptcy?

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The Federal Bankruptcy Code provides several different types of bankruptcies that can be filed. The most common type of Bankruptcy is located in Chapter 7 of the Bankruptcy Code.

A Chapter 7 bankruptcy comes from the 7th chapter of the bankruptcy code. It is also known as the “liquidation” bankruptcy because the Trustee has to liquidate, or sell, all nonexempt property in order to repay your creditors. The majority of individuals who file for Chapter 7 get the keep their property, however there are some states that are more charitable than others. The process normally takes about 3 months and requires only one meeting outside of court with the Trustee.

The trustee is the official selected by a bankruptcy judge to process your case. Bankruptcy has a law known as the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) that requires filers to take a “means” test. This test is to certify that filers who have “disposable” income are forced to file for Chapter 13 instead. However, most people who file for Chapter 7 do not have “disposable” income and therefore continue to file as such.

Before filing, you will need to consult with a nonprofit credit counseling agency. The idea of this consultation with the credit counseling agency is to check if there is an attainable way, without falling deeper in debt, for you to manage your outstanding balances without filing for bankruptcy. After completing the counseling you can begin to file your case.

The first thing your attorney will do is file for a “Voluntary Petition”, which is the official form that asks the court to pardon your debts.  There is a packet of forms that will need to be completed along with an extensive list of required documents, but there is no need to fret because your attorney will take care of the majority of the forms on your behalf. Once this has been filed an “Order of Relief” will be put in place by the court, which will cause your creditors to cease the harassment calls, at least for some time.

During the time that your case is open, you cannot sell or give away any of your property. A notice will be sent advising you when and where the meeting of creditors is going to take place by your trustee.  This is usually out of the court room and you will be asked a few questions, under oath. As long as you have answered everything truthfully and you have past the means test, you should have a favorable outcome.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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What is Chapter 13 Bankruptcy?

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Chapter 13 bankruptcy consists of paying back part or all of your debts in manageable monthly fees without the harassing phone calls from creditors.

If your debts are getting out of your control but your income is still more than the median of the state and you have been living in the same state for the past two years, you can still file for bankruptcy. A Chapter 13 bankruptcy was put in place for those who still have some “disposable” income after paying all their expenses and/or for those who’d like to keep the property that they would otherwise lose if they filed for Chapter 7. A form is completed to determine if the amount of “disposable” income is equal to or less than the states median, how much is actually left, and whether a 3 year plan or a 5 year plan will be implemented.

Once a timeline plan has been chosen, a repayment plan is then hatched. To construct a repayment plan, you most show that you can stay on top of your secured debts, such as mortgage, car note or domestic support obligation, while still paying off your unsecured debtors the value of the properties that you would of otherwise had lost in a chapter 7 bankruptcy case. You must also be up to date with all of your tax filings.  If you are not current with your tax filings, you must first complete that before continuing to file bankruptcy. When the proposed repayment plan has been accepted, a bankruptcy judge will then confirm it and it is now up to you to follow through with the plan.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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No Shame in Filing for Bankruptcy

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Filing for Bankruptcy is a necessary process for many American people and businesses.

From a young age people are persuaded by means of seductive language and/or highly skilled advertising techniques to purchase products and services deemed essential for their lives, even if those products or services are out of their financial reach. Many of our leaders have told us that it is our patriotic duty to spend, and you need look no further than former President George W. Bush urging the American people to spend after the tragic events of September 11, 2001.

If you don’t have the means to buy, that has never been a problem because credit card companies spend a great deal of money sending constant solicitations of pre-approved credit cards that were never even requested. The credit card companies mostly target people with bad credit ratings and college students. Individuals with bad credit are desperate and will consent to ridiculous interest rates thus increasing their profits, and college students are backed by their caregivers if they happen to default on their payments. These pre-approved credit cards have made it so simple to live beyond our means.

At a time when governments are providing billion-dollar bail outs for banks who have mismanaged their finances, should you really feel ashamed about asking for a second chance with bankruptcy? Bankruptcy isn’t based upon punishment or retaliation but rather on forgiveness. Bankruptcy can help free up some income that could provide more resources for your children or loved ones, including reduce the suicide and homeless rates.

If you find yourself under a mass of debt because of a job loss, medical expenses or simply hugely indebted, bankruptcy can give you a fresh start and the proper tools to make wiser choices in the future.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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Florida Foreclosures Still High But in Decline

While FLorida still is among the states with the highest rates of Foreclosure, the rate of new foreclose filings is in decline.

While Florida is still among the states with the highest rates of Foreclosure, the rate of new foreclosure filings is in decline.

For Florida, it may be a turning point in the foreclosure crisis.  When compared year to year, the foreclosure rate in Florida is down nearly 37% making it the lowest it has been since 2008.  That equates to fewer than 4 million people who are not current on their mortgage.  In Florida, 12% of homeowners with mortgages are not current on their payments ranking it third out of fifty in the nation for most delinquent mortgages.  These numbers reflect a twenty percent reduction in delinquency in the past six months, ranking Florida the second most improved.  The number of properties with delinquent mortgages are at levels not seen since October 2007, and new foreclosure filings are at their lowest since then as well.  For the first time since 2008, prepayment rates have increased.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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Using the Bankruptcy Cram Down to Save Investment Property

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Ch. 13 Bankruptcy can provide the principal reduction and debt restructuring that can help save investment properties.

Many clients come in to my office seeking assistance with modifying their investment property mortgages. The first question I am usually asked is “will the bank reduce my principal down to what the property is worth?” The answer is that meaningful principal forgiveness is very rarely offered in conventional “HAMP” or “Proprietary” modifications. Unfortunately, this results in investment properties becoming unaffordable and impossible to maintain. However, these clients are often amazed when I advise them that they can cram the mortgage loan amount down to the fair market value of the property in Ch. 13 Bankruptcy.

A “cramdown” in a Chapter 13 bankruptcy enables the borrower to reduce the principal balance of a mortgage loan down to the actual market value of that property. While this Chapter 13 cram down may be utilized to save a car, boat, or other property, the benefits are best realized in saving investment real property. The catch is that most courts require that the balance be paid off in the 5-year Ch. 13 payment plan. However, there may be exceptions and an attorney should be consulted to determine and explain your options.

For those borrowers in South Florida who may benefit from and are considering the cram down, the time is now for doing so because property values in Broward & Palm Beach counties have been rebounding substantially in recent months. As the values go up, so does your potential balance under the Ch. 13 cram down. Also, the bankruptcy case can be filed and initiated at any point; whether you are current on the mortgage or in foreclosure.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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FHA Mortgage Applicants with Recent Foreclosures Offered a Pass

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FHA offers a new program to help otherwise eligible borrowers with recent foreclosure troubles qualify for FHA loans

The Federal Housing Administration has instituted a new program called “Back-To-Work-Extenuating Circumstances” to assist potential borrowers who faced financial hardship during the recession. This program, which began August 15th, 2013 provides a second chance for mortgage applicants who have experienced financial hardship such as unemployment or a severe reduction in income beyond the borrower’s control. This program is designed to assist borrowers with a recent history of foreclosure, judgment, short sale, bankruptcy, loan modification, or deed-in-lieu by acknowledging that their credit history may not fully reflect their ability or propensity to repay a mortgage. Prospective borrowers that have experienced an economic event and can document that the event was out of their control, that they have recovered, and that they have completed housing counseling can apply for an FHA-insured mortgage that will allow up to 96.50% financing.

If you have questions about Foreclosure, Loan Modification, Bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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New Foreclosure Cases Down from May 2012

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New Foreclosure Filings in Palm Beach County are down from this time last year

According to the Clerk & Comptroller’s office, new foreclosure filings in Palm Beach County have dropped when compared with June 2012 and May 2013.  Last June Palm Beach County had 1,249 new cases while this June saw only 1,001 new filings, a 19.9 percent decrease.  New filings also decreased 6.2 percent in June compared with May of this year.  According to Clerk Bock, “In June we saw the highest number of deeds recorded with us since June 2006, and most mortgages recorded with us since November 2007.”

June 2013 showed 7,550 deeds recorded, up 30 percent from the 3,654 recorded in June 2012.

There were 5,294 mortgages recorded in June 2013, up 45.2 percent from June 2012.  All these numbers reflect the stabilization of the local real estate market.

If you have questions about foreclosure, loan modification, bankruptcy, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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Florida Remains a Leader in Nationwide Foreclosure Statistics

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Florida is still leading the nation in most foreclosure statistics

Florida remains tops in the nation for the highest percentage of distressed homes and the number of completed foreclosures, a new report has found. The state’s foreclosure inventory (properties in some stage of foreclosure) stood at 8.6% of all mortgaged homes in June, real estate data provider CoreLogic said Tuesday.

While that rate is down from a revised 8.8% in May and from 11.5% in June of last year, it is still more than three times the national average. A total of 107,000 homes in Florida underwent foreclosures in the 12-month period ended in June, CoreLogic said. That was 35,000 more than in the No. 2 state, California.

Within Florida, the Tampa-St. Petersburg-Clearwater region posted the highest foreclosure inventory, at 9.3%, which also ranked it among the nation’s top 25 metro areas. Still, the figure was down from 12.3% in the same period last year.

Orlando-Kissimmee-Sanford was second-highest in Florida, at 8.6% of all mortgaged homes. Nationwide, 2.5% of all mortgaged homes were in some stage of foreclosure in June, compared with 3.4% one year earlier. A total of 701,959 foreclosures were completed in the U.S. in the past year, with 15.3% of that total in Florida.

But while the numbers carried an ominous tone (an estimated 1 million U.S. homes were in foreclosure in June) CoreLogic also noted that the total level of distressed homes was down 28% from 1.4 million homes a year ago.

Moreover, completed foreclosures totaled 55,000 in June, 13,000 fewer, or 19%, than the year-ago period.

“Completed foreclosures continued to drop for the 19th straight month,” said CoreLogic president Anand Nallathambi. “The improvement is broad-based, with 49 states posting a year-over-year decline in foreclosure rates in June. But CoreLogic stopped short of declaring the housing industry completely recovered. “The housing market is clearly on the mend, but we expect the ultimate conclusion of the present housing down cycle to be another several years away,” Nallathambi said.

After Florida, the highest foreclosure inventories were found in New Jersey at 6%, New York at 4.8%, Connecticut at 4.2% and Maine at 4.1%. Wyoming was lowest at 0.5%, with Alaska at 0.6%, North Dakota and Nebraska at 0.7 % and Colorado at 0.8%.

If you have questions about foreclosure, loan modification, bankruptcy, Short Sale, or other alternatives, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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Former Miami Dolphins QB Daunte Culpepper Surrenders Florida House in Foreclosure

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Florida native Daunte Culpepper has surrendered his house to SunTrust bank in lieu of Foreclosure

Daunte Culpepper’s 2006 signing with the Miami Dolphins was so disastrous that the repercussions are still being felt. In a foreclosure case, the former NFL quarterback has lost a home he bought for about $3.6 million back when he was traded to the Dolphins. He surrendered the nearly 10,000-square-foot home to SunTrust Bank back in April in lieu of foreclosure, Broward County court records show, and the bank dropped its lawsuit against the three-time Pro Bowler earlier this month. The bank cited $3 million in debt in court papers, which list a home in Weston, Fla., as Culpepper’s current residence.

After growing up in Ocala, Fla., and playing for the University of Central Florida, Culpepper became a star with the Minnesota Vikings, leading the team to the NFC championship game in 2000, his first as a starter. But a serious knee injury derailed his Vikings career in 2005, and he was traded to the Dolphins in 2006.

Though his return to his home state was celebrated, Culpepper failed to live up to the eight-year deal worth nearly $60 million, struggling in his comeback from the knee injury and adding a shoulder ailment as well. Things got ugly off the field between Culpepper and the Dolphins, with the team trading for quarterback Trent Green the next off-season and Culpepper asking for and eventually receiving his release. He spent three more years in the NFL, with the Oakland Raiders and Detroit Lions, and last played for the United Football League’s Sacramento Mountain Lions in 2010.

If you have questions about foreclosure, loan modification, bankruptcy, or short sale, please feel free to call my office at 888-886-0020, send an e-mail to emil@fleysherlaw.com, or complete the contact form below.

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