Repossession – How to Avoid it

Following many years of lobbying by debt and consumer affairs agencies, the rules on repossession have changed making the whole process fairer to the occupiers and building in certain safeguards and procedures that must be followed. With the current economic climate, the rate of repossessions is climbing as borrowers face increased budgetary challenges even after taking effective measures such as debt consolidation.

Lenders, whether in England and Wales or in Scotland (where the rules are different) have to take broadly the same steps before they can effectively repossess a property. That means that anyone with debt problems will receive written notice from their lender of the impending action with the final resort being actual physical repossession. Therefore, any borrower should act immediately upon receipt of any letter from their lender to address debt problems and rearrange finances to ensure that the mortgage payment is met.

Debt problems have to be addressed early and tackled hard if this final stage of action is to be avoided. One approach that may help is debt consolidation where a new loan is taken with a long repayment period and the proceeds used to pay off high interest debt or loans with high monthly payments. It may also be possible to remortgage the home making the new payment plan more affordable. Whilst this is easier to achieve before debt problems get serious, any debt rescheduling to free up monthly cash flow can make a huge difference to affording the essential bills such as mortgage repayments.

Once the mortgage payment become overdue the lender must send out a formal written notice. This will contain details of the mortgage balance plus any late interest or other fees that have accrued to the account. At this stage the lender will make contact in order to discuss debt problems and listen to any proposals that the borrower may have for getting the account back up to date. At this stage, a remortgage or loan restructure may be considered. It may be that other actions being taken need time to be completed, such as applying for a debt consolidation loan, in which case the lender may hold off further action pending these plans coming into place.

Once formal notices have been issued, the lender also has to provide details of the local council’s housing department in order that investigations can be made as to suitable alternative housing. If the debt problems are significant the borrower may also be given the details of an independent debt counsellor who can assist with formulating a workable debt consolidation or management plan.

The borrower always has the option of selling the property and using the proceeds to clear the arrears and loan balance. This action may be sufficient to stop the lender pursuing repossession provided that the sale process is not unreasonably managed. A managed sale should realize more that a distress sale by the lender and with the borrower still liable for any shortfall or the beneficiary of any proceeds there is a lot to be gained by this approach. Handing the keys back to the lender and walking away is a last resort strategy that will not let the borrower off the hook for prior debt.

Even if all the actions taken are insufficient to prevent court action being initiated by the lender there is still a good chance that repossession can be avoided. There is still time to negotiate a solution with the lender particularly if the debt problems are of a short term nature. At this stage, the borrower should get professional advice and support since even a court action does not mean automatic repossession. There are numerous defenses that can be offered including incomplete or incorrect procedures being followed, asking for time to apply for benefits that would clear some or all of the arrears or that it is proving difficult to find somewhere to live. Other personal factors may also be relevant that will persuade the court not to grant a repossession order.

Even though there may be numerous debt problems that have led to a failure to make mortgage payments it does not mean that the family home has to be repossessed. Every personal circumstance varies and getting all the details known plus an attitude of wanting to address debt issues in a positive way can prevent losing the family home. Professional advice is essential as is early action to address debt problems so as not to end up threatened with a repossession order.

Stop by Tony Sprake’s site where you can find out all about bankruptcy and how it can affect you.

Guide To Bankruptcy: Choosing The Right Chapter

Federal laws designate specific rules that must be followed to be able to file bankruptcy. Although these rules are a large part of the criteria you must meet, there are also state laws that add more criteria. Bankruptcies are not to be entered into lightly, so it’s important that you understand the differences and file under the appropriate chapter that applies to your specific circumstances.

A Chapter Seven is the most commonly used because it wipes out the debts you claim. Basically, you claim all debts, including anything financed with credit. There are some things that are not eligible under a Chapter Seven. Debts like injury judgments, back child support, and college loans cannot be included. Additionally, you are required to surrender any assets that are considered non-exempt, like the second car you are paying on or the second property you own. These assets are liquidated and used to pay off balances. Whatever remains will be discharged by the court.

Most businesses choose a Chapter Eleven. This chapter allows a business to file while still staying operational. The debt is structured with a payment plan so the debt is repaid over a designated time period. The restructuring helps the company avoid future financial problems as well.

Chapter Thirteen bankruptcies are sometimes confused with a Chapter Seven. Under a Chapter Thirteen, debt claimed is not discharged. Instead, it restructures the debts, combining them into payments that are based on the filer’s income. You don’t have to surrender your assets. The court will determine, again based on income, the time you have to repay your debt. After you have completed your repayment plan, within either three or five years, your debt is then discharged.

There is also a chapter that is specifically designated for farmers and fishermen who use these means to support their family. In order to qualify for this chapter as a business, your company must be owned by a single family unit. For individuals, you must verify your occupation. Your total debt must not exceed certain limits and the ability to repay debts must be proven.

State rules have a few additional requirements. Many states will also require credit counseling before any chapter will be granted. There are also some states that will require you to obtain a lawyer because of the complicated nature of certain chapters. Regardless, it’s a good idea to discuss your options to see what you qualify for.

Credit counseling can also help you if you can’t qualify for any chapters. A credit counselor can advise you on the best ways to handle your debt. He or she can also act in your interest when talking with creditors for better terms. If necessary, you can also be signed up for a debt consolidation.

It’s important for you to do thorough research. You don’t want to file under the wrong Bankruptcy Georgetown chapter. You will need to talk with a special attorney to find out what chapter you can file and what documents you will need.

How To Claim Bankruptcy – What You Should Think About

Bankruptcy is a situation where a person or legal entity can no longer repay or service their debt. With the recent economic downturn many people have been caught out by finding themselves in a situation where not only can they not afford to repay their debt, they cannot afford to pay the interest. This has meant that many are now looking to find out how to claim bankruptcy.

However, a bankruptcy petition is sometimes not a matter of personal choice. A creditor can file a Bankruptcy Order against a debtor, and bankruptcy proceedings will continue even if the individual against whom it has been served ignores or disputes it.

Claiming bankruptcy should only be entered into as a last resort, and all avenues should be explored before taking this final step.

So what are the pros and cons of Bankruptcy?

The most popular chapter to file bankruptcy under is chapter 7, where an individual has all debt taken away. Not all debt can be written off however, and if the main contributor to the bankruptcy is debt that has to be repaid, a chapter 13 bankruptcy is the more appropriate chapter.

There are two downsides to this however.

The main disadvantage is that the majority of your possessions are liquidated to pay your creditors.

The other downside is that those who have had financial dealings with you in the past, if, after selling all your possessions are still out of pocket, are unlikely to want to have any financial dealings with you in future.

All the above relates to chapter 7 bankruptcy laws.

New laws introduced in 2005 make all bankruptcy applicants undergo a financial means test.

In addition, your income is examined and if, over the 6 months prior to filing, your income is more than the median in your state for a family of your size (and you fail the means test), you cannot claim chapter 7 and are pushed into chapter 13.

No personal property is liquidated under chapter 13, but all debt is repaid under a 3-5 year repayment plan.

The means test used to define an individuals allowances and income is complex and quite harsh. The means test can also make your income look better than it is, resulting in a repayment plan that leaves an individual with very little disposable income.

After bankruptcy, rebuilding one’s credit score is vital. Your credit record will retain details of a chapter 7 bankruptcy for a period of 10 years and a chapter 13 for 7 years.

For more free information on how to claim bankruptcy and the various chapters and how they work, go to www.howtoclaimbankruptcy.net

The Final Moves You Can Make To Avoid Bankruptcies

Some people just surrender to the seemingly inevitable fate of bankruptcy. But is it the right approach to deal with bankruptcies? We think not! Dig in the following tips to know what the things are that you can do, as your last stand against a bankruptcy.

First things first, you can consider scouring your home as well as its storage for selling off each and every item which you do not use or feel needed. Do not assume that selling these things is giving you free money. Actually, you need to set this money aside to pay off your debts.

And use this money to pay off the most threatening debts first. For instance, you will need to pay off the mortgage and/or rents prior to everything else. If you’re able to move to anywhere cheaper, that’s highly suggested. And do take the utilities seriously as they are sometimes more vital than any other things. The next most important things would be the vehicles. Only then you consider the other debts. Believe it or not, credit cards should be your last item in your debt priority listing.

You can also get a part-time of second job. Taking some sided jobs can be just great for earning some extra money for paying off the debt. True, it isn’t that easy – especially when you’ve got mouths to feed or a family to run. Not to mention that you will have spend more time apart from them. Still, each and every dollar counts while you’re trying to safe yourself from the spiral of bankruptcies.

If you can find a good job, you might even manage to spend some extra for your family (in addition to paying the debts each month). For instance, you can try a range things like delivering pizza, working as a waiter, or serving as pooper scooper (believe it or not, you can make $10 per yard!) landscaper, computer technician and so on. Just look around to figure out what people need in the locality and how you can best fulfill that. Then advertise or promote your services. Some people actually end up making a lot more than they actually need. Just try to be constant and strong with your efforts.

You also need to handle your medical debts. First contact the financial office of the hospital. They might actually offer programs which help you in those needs. There are a number of programs which include lower payments options and some kind of sliding fee scale which is set on the basis of your current earning levels. Be proactive to find such privileges, as nobody is there to tell you willingly.

If these tips are followed, may be there’s good chance for debt burdened people to escape bankruptcies!

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Bankruptcy Lawyer: When To Hire One

If you are having difficulties with finances and are considering debt consolidation or bankruptcy, you may also be considering hiring a bankruptcy lawyer. Of course for those who are in a financial rut or on the verge of financial ruin, coming up with extra funds to pay a bankruptcy lawyer can be downright impossible. Despite the shortage of money, it is often best to still consider at least consulting with a bankruptcy lawyer before you begin the process.

The main purpose of a bankruptcy lawyer is to help an individual or business go through the legal procedures for filing bankruptcy. Lawyers are meant to help deal with creditors, meet with the court systems to set up payment plans or repayment programs, gather together and liquidate assets, and fill out and file necessary paperwork. Just as a realtor would be the knowledgeable party in the selling or buying of a home, a bankruptcy lawyer will be that knowledgeable source during a bankruptcy proceeding.

In most state and county legal systems, you are not required to have a bankruptcy lawyer for the legal proceedings. This does not always mean it is wise to do without a bankruptcy lawyer, though, as most specialize in just financial law. Unless the court case would be easily cut and dry or you already know a great deal about the legal system in this case, a bankruptcy lawyer can help from becoming overwhelmed with the legalities of the system.

From the start, a good bankruptcy lawyer should help you to determine which chapter of bankruptcy to file and will offer sound reasons why. If you don’t know anything about the different chapters, this is an excellent reason to begin consulting a lawyer. Many lawyers will even offer a free consultation where you can simply claim the advice and move on to take care of the remainder of the case yourself. Often, though, lawyers will charge by visit or by activity, such as appearing at the courthouse or filing paperwork.

Keep in mind that not all bankruptcy lawyers specialize in the same type of cases, so it is important to find a lawyer who can help you with the type of financial difficulties you are having. Some bankruptcy lawyers work specifically with businesses, while others work solely with individuals. Having a good experience with your lawyer will undoubtedly include finding someone knowledgeable in the areas you need expertise.

Another excellent reason to consider hiring a bankruptcy lawyer is simply to have someone knowledgeable who can help guide you through the paperwork process. In bankruptcy cases the paperwork is the most overwhelming aspect and more often than not, bankruptcy lawyers will actually fill out and file all of the paperwork for you. This takes away the burden of dealing with paperwork in the middle of a financially and emotionally straining time.

If you decide that hiring a bankruptcy lawyer is right for you, ask the local court house for names of lawyers in the area. You may also want to consider asking trusted friends or family advice for finding bankruptcy lawyers. If all else fails, take advantage of technology and research cases in your area to see which bankruptcy lawyers most often represent individuals or businesses. This is a great way to determine who the best lawyers are for your financial needs.

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Federal Government Credit Card Debt Relief Program

With uncertainty in the air about the economy, people are finding that their rising credit card debts are a cause for concern. Along with the increasing payments and rising interest rates, people can no longer pay for their basic necessities like groceries and fuel. As a result of this the government credit card debt relief program was instituted. However, you may have heard of it as the Obama credit card debt relief program.

Many people have asked themselves this very question. If you personally owe more than $10,000 in debt then this could be the best option for you. The Obama credit card debt relief program will assist those that qualify to remove their debts anywhere from 50% – 60%. This means the debt is gone and you won’t have to pay it back in the future.

Those who find that they are interested in potentially using the government credit card debt relief program should research more about this. With consolidation groups and some great legal advice this service becomes an essential tool. The debt reduction you see happen because of laws that have come into play that are designed to reduce your current debt. Along with this, you are protected from credit harassment and future fees and interest that some companies try to snag you with.

As an individual that is struggling what more could you do in your daily life with funds that you desperately need that is being shelled out in credit card interest?

What some don’t realize is that with the government credit card debt relief program their interest payments can go away. Currently thousands of dollars are being paid monthly to credit card companies that never touch principal balances. By using the options of the program, the financially wise begin to take money off their current balance, and stop paying outrageous amounts of interest.

Let’s look at a quick figure. If you had a balance of $10,000 owed it could take almost four decades to pay it off. That small amount quickly becomes $40,000 that you are spending. What that translates to is $30,000 of interest is being assessed. Wouldn’t that money be better spent on a down payment for a home, or a new card to get you to and from work?

There is a misconception that this program deals with a handout policy. That when you use it, the government gives you money and you don’t have to pay it back. That isn’t how it works at all.

With the different companies who run the government credit card debt relief program, their goal is to have credit card agencies clear your debt from your files legally. The only money that is paid out is from you when the process is done. What happens is the credit card company has an obligation to reduce the interest that is attached to your debt and make it so you can actually pay it off.

Anyone looking to clear the debts they have and begin to save money instead of owing more should consider the government credit card debt relief program. There are many agencies that can help you and get you to a place where you can breathe easier again.

Get complete details and information about how you can get government credit card debt help easily!

Bankruptcy Is Not The Only Option

Bankruptcy is on the rise. It is one way many deal with their insurmountable debt. The filing for insolvency can have long term consequences however that might be avoided through alternatives or credit negotiation. The filing can remain on a person’s credit report for up to ten years in some cases. This will have negative consequences on a person’s ability to apply for credit or for a loan during this long period of time. So people need to think carefully about making this move.

Recent legislation makes it more difficult to file and to be approved. The judge must approve the filing and many factors will be examined. The person’s financial situation will be scrutinized. If it is determined that the person who is filing has the means and the capability to pay back the debts, the filing will be denied.

Those who were looking for a fast and easy way to have their debt extinguished might find that their request for insolvency turned down. Of course there are many advantages if the judge does approve the request for insolvency. The debtor no longer has any debt to pay. They will be relieved from harassing creditors and will in essence be able to start with a clean slate.

For those who declare insolvency, they will be able to get credit or be approved for a loan, contrary to what many believe. But they will have a difficult time finding a lender to extend credit and when they do find one, they will have to pay a much higher interest rate. In fact, there are many lenders who like to lend in these cases because they can charge a higher rate of interest.

There are other options to filing for insolvency. Most people file because of their credit card, or unsecured debt. The unsecured debt means that there is nothing for the creditor to attach, or repossess. This means that a creditor might be willing to negotiate a settlement with the debtor. The debtor has the option of dealing with the lender, or he can seek help from a professional credit negotiator who will work with the credit card companies on his behalf.

Creditors who cannot recover the money owed them by a debtor will sell the loan to a collection agency for as little as ten cents on the dollar. This is a ninety percent loss for the creditor. A credit negotiator can offer the creditor a settlement offer of fifty percent of the balance that is due. This is better deal than ten percent the creditor would get by selling the loan.

The negotiator will also inform the creditor that the debtor is considering filing for insolvency. If this happens and if it is approved, the debtor of course will receive nothing. The negotiator will explain to the creditor that if the debtor can get that company, and others to agree to some form of settlement, that the debtor will not have to file and the creditors are more likely to get some of their money back as opposed to nothing if the filing is approved.

Bankruptcies are increasing because of the tough economy. People are losing their jobs and simply do not have money to pay back their debts. For this reason, there are more creditors willing to work with debtors and come up with a settlement agreement.

If you have been searching far and wide for bankruptcy Scarborough alternatives that fit your particular lifestyle and situation, then a visit to KillenLandau & Associates is a must.

How A Bankruptcy Plays A Role In Mortgage Approvals

When it comes to getting qualified for a mortgage loan, a bankruptcy can play a crucial role in your ability to get approved. There are many factors that a bankruptcy has on the mortgage process. Knowing what to expect can help you improve your chances for a loan approval.

The Waiting Period

If a person has filed bankruptcy, it will be more difficult to get approved for a mortgage loan. Many mortgage loan programs will require a waiting period from the time the bankruptcy has been discharged before the mortgage can be approved. Depending on what type of bankruptcy that you filed will depend on how long the waiting period will be. If you filed a chapter 7 bankruptcy, then you will have to wait at least two years from the discharge date before the mortgage loan can be approved. The two year waiting period is based on a FHA home loan. A conventional mortgage loan will require a four year waiting period.

If you have filed a chapter 13 bankruptcy, the waiting period is still the same on a conventional home loan, but on a FHA mortgage loan, there is a way to finance a property while still in chapter 13 bankruptcy. FHA loan programs will consider the filing date when calculating the waiting period. A chapter 13 bankruptcy customer can qualify for a loan after one year from filing the bankruptcy. Since many clients are still in chapter 13 bankruptcy after one year, you must get approval from the trustee of your case, that you can add an additional debt like a mortgage loan. Without the trustee approval, you will not get approved for the mortgage loan.

All home loan approvals with clients still in chapter 13 bankruptcy require manual underwriting and must follow the FHA loan guidelines.

Reestablishing Credit

For many clients that file bankruptcy, the hardest step in getting a loan approved is that many loan companies require that the client has reestablished a positive credit history since the bankruptcy. Reestablishing credit history must also show no new derogatory accounts since the bankruptcy. For example, if you have a bankruptcy that was discharged in 2009 and in 2010, your car was repossessed, then you will not qualify for a mortgage loan.

Reestablishing credit history usually consists of at least a vehicle loan and a revolving credit account. Make sure to keep your credit card account balance below 10% of the actual credit limit. Home loans require the reestablishment of credit for qualification.

There are other mortgage programs besides FHA home loans and conventional mortgage loans that have different guidelines when considering a bankruptcy. These types of loans are considered non-traditional loans and many of these programs require a large down payment. Home loan rates on these programs are also usually 2 to 3 percent higher than a normal conventional home loan.

Avoid New Negative Credit

The most significant thing to remember after a bankruptcy is to reestablish credit and do not have any new negative accounts since the bankruptcy was filed. You want to show the mortgage company that the bankruptcy was an once in a lifetime event and will not happen again. If the loan company believes that there is a habit of bad credit or the likelihood of filing bankruptcy again, the mortgage loan will be turned down.

Bankruptcy is not a home loan killer, but if you have filed bankruptcy in the last seven years, it is important to make sure that you are doing everything necessary to have good credit, especially if you want to buy and finance a new house.

David White is a Sr. Home Loan Specialist who assist his customers with their Home Loans.

Is Chapter 13 Or Chapter 7 The Best Bankruptcy Option?

Chap 13 gives men and women a number of advantages over liquidation under Chap 7. Perhaps most notably, bankruptcy filed under chapter 13 presents consumers a chance to preserve their homes from foreclosure. By filing under this chapter, men and women can avoid foreclosure proceedings and may fix delinquent mortgage payments over time.

However, they must still make all mortgage payments that come due during the chapter 13 plan on time. An additional plus of bankruptcy filed under chapter 13 is that it allows consumers to reschedule secured debts (other than a mortgage for their primary residence) and extend them over the life of the chapter 13 bankruptcy plan. Doing this may lower the payments.

CH 13 also has a unique provision that safeguards third parties who are liable to the debtor on “consumer debts.” This provision may shield co-signers. Last but not least, chapter 13 bankruptcy acts like a consolidation loan under which the individual makes the plan payments to a ch 13 trustee who then directs payments to creditors. People will have no one on one contact with creditors while under chap 13 protection.

Almost any person, even if self-employed or operating an unincorporated business, is a candidate for chap 13 help as long as the person’s unsecured debts are less than $360,475 and secured debts are less than $1,081,400. These amounts are modified regularly to reflect changes in the consumer price index. A corporation or partnership may not be a chap 13 debtor.

A person is not able to file under chapter 13 or any other chapter if, during the previous 180 days, a previous bankruptcy petition was dismissed due to the debtor’s willful failure to appear before the court or conform with orders of the court or was voluntarily dismissed after creditors sought relief from the bankruptcy court to recover assets upon which they hold liens. Moreover, no individual can be a debtor under bankruptcy filed under chapter 13 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an authorized credit counseling agency either in an individual or group briefing. There are exceptions in emergency conditions or where the U.S. trustee (or bankruptcy administrator) has established that there are insufficient approved agencies to offer the required counseling. If a debt management plan is produced while in necessary credit counseling, it has to be filed with the court.

An experienced MA debt lawyer can provide you with which options are right for you.

What Can Credit Card Companies Do If I Stop Paying My Credit Card Debt?

As a bankruptcy lawyer, one of the first things I advise my clients to do when they decide they are filing bankruptcy and hire me is to stop paying on their credit cards. Recently, though, before I could offer that advice, a client asked me: “What happens when I stop paying my credit cards?”

Once you stop making credit card payments, the collection process will start. Collections normally progress as follows:

1. The original creditor will call you, your family, your place of employment, non-stop for about 60-90 days trying to get you to pay something over the phone and making all kinds of threats about how they are going to ruin you financially unless you pay them.

2. In about 90 days, your original creditor will give up and sell your account to a debt collector. This third party agency will then repeat the actions above.

3. After about 180 days since you stopped paying, you may get a call from an attorney trying to collect on the debt who will repeat the actions listed in 1 and 2 above.

4. At this point, the attorney might file a lawsuit, seeking a judgment against you. A judgment would permit the creditor to collect from you through a wage garnishment. Your wages cannot be garnished without a judgment.

So, by my estimation, it has been at least 6 months since the last payment was made. Takes a bit of time for a judgment to be obtained. Then, how come, when a client hires me as their bankruptcy lawyer, do I tell them they should stop making their credit card payments?

Because the idea is for my client to be filing bankruptcy sometime well before the judgment is entered. Garnishment is taken out of the equation. This way, my client uses the payments they would have made to an abusive debt collector, for a credit card debt, to catch up on a car payment or a house payment they want to keep through filing bankruptcy, or to start building that safety net their Orlando bankruptcy lawyer advocates creating as part of your fresh start strategy when filing bankruptcy.

As for those rude and abusive debt collectors, why not sue them? You see, here in Florida, we have some of the toughest laws in the country to protect consumers. These laws are intended to protect you from the abuse described above, which debt collectors use on a regular basis to coerce you into paying your debt. Aside from the Florida laws, there is also a Federal Law which prohibits third party debt collectors from those same abusive acts. To enforce your rights, you can sue your creditors.

The debt collection process can be an intimidating experience, or an empowering one. If you know how it works and you know your rights, the empty threats the debt collectors hurl at you in a typical phone call from them will seem laughable, and more often than not, actionable.

To learn more about how an experienced bankruptcy lawyer can guide you through the collection process and assist you in getting a fresh start financially, try my Free eCourse.

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