Department of Justice provides directive on bankruptcy cases involving marijuana assets

The multi-billion dollar marijuana industry is growing quickly, with twenty-eight states now approving the legalization of recreational or medical marijuana to some extent. On April 26, 2017 the Director of the United States Trustee Program provided a directive to Chapter 7 and Chapter 13 bankruptcy Trustees – do not administer cases involving marijuana assets. Apparently there has been an increase in the number of bankruptcy cases involving marijuana assets. The take-away for potential Debtors: even if certain marijuana assets, or income derived from such assets, are not considered illegal under state law – they are under federal law. If a Debtor files for bankruptcy relief and has an interest in marijuana assets, they will certainly be smoked out!

If you or your business is considering filing for bankruptcy relief, contact the McIntyre Thanasides law firm to schedule a consultation with an attorney who is a qualified bankruptcy professional.

Second Mortgages Still Being Discharged in Tampa Bankruptcy Cases

Second Mortgages Still Being Discharged in Tampa Bankruptcy Cases

After the market crash of 2008, and the resulting depreciation of many residential properties, many home-owners in the Tampa Bay area were able to get rid of second mortgages on their properties. This allowed a great benefit for those seeking to retain their homes, by way of eliminating the debt service of the second mortgage. Bankruptcy law is complicated, but the basics are that if you owe more on your first mortgage than the property is worth, you may void the lien of the second mortgage and discharge the debt in a chapter 13 bankruptcy. While home prices have been steadily gaining over the last few years in the Tampa Bay region, the McIntyre law firm is still working with many homeowners to discharge their second mortgages in bankruptcy. Further, we can assist consumers with restructuring their first mortgage loans. If you are facing issues regarding the servicing or payment of your home loans, we encourage you to speak with the bankruptcy attorneys at the McIntyre law firm.

Can Bankruptcy Help with Past-Due HOA Fees?

The short answer is yes! Often times when dealing with mounting homeowner’s fees, you may feel there is no available option to remedy the situation. The bills continue to pile and fees add up with no end in sight. However, there are several options available to you with respect to alleviating some of this financial strain.

Florida law permits HOAs to impose a lien upon a property to secure payment. In Florida, under both Chapter 7 and Chapter 13 bankruptcy, you can potentially strip off your HOA lien if the property is worth less than the amount you owe on your mortgage. While filing for bankruptcy may eliminate past due amounts, you will be responsible for paying current amounts as they become due after you file your bankruptcy case if you wish to retain the property. A Chapter 13 bankruptcy may also give you an opportunity to restructure past amounts due if you wish. To further understand your legal options it is best to discuss your particular case with an experienced bankruptcy attorney.

For more information on how bankruptcy can help with past-due HOA fees, contact the bankruptcy lawyers at McIntyre Thanasides today.

Divorce and what to do with the Family Home

When going through a divorce, some couples find that it desirable for one spouse to keep the family home. After all, the kids are comfortable living there and staying would save the expenses and hassles of moving. For other couples, however, it is too much of a financial burden for one partner to keep the house. Fortunately, there are options and tips for both types of couples.

If One Spouse Wants to Keep the House

If one spouse would like to keep the home, the first thing to do is to make sure that he or she can afford it. Some spouses may be able to get a loan based on their individual income and assets. If there is enough equity in the home, the spouse can use it as collateral for the loan to buy out the other spouse.
If the house still has a mortgage, spouses who decide to stay in the house should refinance the loan in his or her own name and take the other spouse’s name off the loan. This way, the spouse moving out is freed from the loan’s obligations.

If Neither Spouse Wants the House

Sometimes for financial or personal reasons, neither spouse wants to remain in the house. The best thing to do in this case is to sell the house. While waiting for the house to sell, it is important to keep up the mortgage payments to maintain good credit.

If one spouse alone cannot afford the mortgage payments, he or she can work out an arrangement in the marriage settlement where the other spouse will contribute to the payments and be reimbursed once the house sells.
Couples who are already in financial trouble and cannot keep up with the mortgage payments may consider a short sale to get the house off their hands. This is where a lender agrees to allow the house to sell for less than the value of the mortgage. Sometimes the lender may not hold the couple responsible for difference between the value at which the house ultimately sells and the remaining mortgage balance.

Experts recommend that couples do not simply walk away from the mortgage and allow a foreclosure of the home, as both spouses’ credit ratings would be ruined for the next seven years. In addition, the lender may still be able to sue both spouses for the remaining balance.

Instead of walking away from the mortgage, filing for bankruptcy can be a better option. In many cases, this allows divorced couples to renegotiate the debt.

Source: “Need to Sell your House in Divorce?” Divorce360.com

Emergencies can lead to out of control debt

Before the 2007 recession, the majority of Americans were not putting much thought into their emergency savings account. Without any “just in case” emergency funds, when people starting getting laid off and being forced to take pay-cuts, many no longer could afford their lifestyle. Some saw their homes go into foreclosure, while others had to deal with the constant calls from bill collectors.

Since then, while the economy has started to rebound and some are trying to save for emergencies, almost half of Americans still have more credit card debt than that saved in emergency funds. Bankrate.com conducted a survey by questioning 1,004 participants over the phone. This is the third year in a row the company has conducted this survey.

In 2011, 52 percent reported having more in savings than in credit card debt. The following year, in 2012, the overall percentage increased to 54 percent. In this most recent survey, 55 percent reported having more in savings than in credit card debt.

At first glance, this certainly seems encouraging. More and more are starting to save for emergencies. However, Greg McBride, who is a senior financial analyst with Bankrate.com, said that people are still not saving enough. Even with the better overall economic situation of the U.S., not enough attention is being given to saving for an emergency.

The issue is that, even though the economy has improved some, without money in savings, Florida residents will not be able to pay for emergencies. For example, if suddenly a homeowner comes down with a debilitating disease, there will be medical bills. However, since there is no extra money put aside to pay these bills, the homeowner will have to dip into the funds he uses for his other bills, like his credit card and mortgage. This in turn can lead into a vicious cycle where the homeowner owes money to multiple entities and just cannot keep up. In some cases, the threat of foreclosure can become very real.

In cases like this hypothetical one, or really any situations where debt is becoming overwhelming, instead of continuing to stress out, talk with an attorney who has experience handling debt relief cases.

Source: ABC News, “Nearly Half of Americans Have More Credit Card Debt Than Savings”, Susanna Kim, Feb. 25, 2013

Experts Predict the Number of Foreclosures to Rise in 2012

In 2011, the country saw a slowing of the foreclosure crisis that had engulfed the country in the previous years. Any hope that the crisis had reached the bottom and the housing market was finally on the road to recovery has been tempered by the expectations of many real estate experts.

Real estate company Zillow believes that the housing market hasn’t even hit bottom yet. The company believes foreclosures will rise in this year and that housing prices will not bottom out until 2013. Mark Seifert, executive director of the counseling group Empowering & Strengthening Ohio’s People, told Reuters that he expects 2012 to be a “bigger year for foreclosures than 2010.”

One of the reasons experts believe foreclosures will increase over 2011 is that many large banks put foreclosures on hold during the recent robo-signing scandal. Now that a settlement has been reached, it is expected that the banks will resume foreclosures.
Reuters notes that the mortgages foreclosed upon in 2012 will differ from those at the beginning of the housing crisis. Early on, many of the foreclosures involved subprime mortgages, but now most of these mortgages are no longer in the market. This means that the expected foreclosures will involve people with “ordinary mortgages” who have been impacted by the down economy.

Whether you are currently in foreclosure or behind on mortgage payments, losing your home does not need to be inevitable. People struggling to make ends meet may have several options for keeping their home such as negotiating with their mortgage company and other alternatives to bankruptcy or filing for Chapter 13 bankruptcy.
Every situation is unique and there is not a “one-size-fits-all” solution that works for everyone. By speaking with an experienced bankruptcy attorney you can learn what solution(s) work best for you and your family.

Source: Reuters.com, “Americans brace for next foreclosure wave”, Nick Carey, April 4, 2012

Recovering From a Bankruptcy

So, you’ve received your discharge from your bankruptcy filing. Now what? How do you begin to rebuild your financial health? A few, simple, but not necessarily easy steps can assist in your recovery.

Verify your Credit History

Bankruptcy provides a fresh start, clearing away most of your debts, so you want to be certain that your credit report is accurate and properly displays any debts that were discharged in the bankruptcy.
If an account still appears in the credit report as open and delinquent, you need to contact the creditor and request that they correct how the account is reported.

You can obtain copies of credit reports from the three reporting agencies, Experian, Equifax and TransUnion. AnnualCreditReport.com provides a yearly, free credit report. The Federal Trade Commission runs this site, so don’t be fooled by other sites with similar names that want to sell you something.

Create a Budget

Once you have checked to ensure your credit report is accurate, you can begin the hard work: improving you credit history. To begin, you need to review what caused your bankruptcy. Was it a divorce, job loss, medical expenses or overreliance on credit cards?
Often it is a mix of causes, but what is important now is to identify the causes and change your behavior. Creating a budget is a good place to start.

Figure out how much you have to spend on housing, food and transportation. From the money you have left over, if any, you can determine how much “spending” money is available. This is a good time to create a savings account, if possible.

Pay Bills On Time

The most important aspect of rebuilding your credit is paying your bills on time. After a bankruptcy, you are reestablishing your credibility with your creditors.

Creditors only loan money with the expectation of being repaid and a credit agreement is, in essence, a promise to pay. By repaying bills on time, you demonstrate your reliability and fulfill your promise. This in turn will eventually result in lower interest rates and a better credit score.

Source: News Olio, “Credit help: How to continue your financial life after bankruptcy”

Considering Debt Settlement? There Are Better Options

The advertisements sound promising: “Pay only a portion of your balance!” “A legal way to reduce your debt load — fast!” Yet, are debt settlement companies as effective as they say they are? Will they be able to settle with your creditors so that you can pay “pennies on the dollar?”
Probably not.

Debt settlement is quicker than bankruptcy, but that does not mean that it will be successful. While debt settlement works for some consumers, many others end up more in debt than when they started. The debt settlement industry admits that debt settlement only works for one third of its clients. And their numbers are quite generous. According to the federal government, debt settlement is successful less than 10 percent of the time.

The Costs of Working With Debt Settlement Companies

Even when debt settlement is successful, it is costly — much more costly than other debt relief options, such as bankruptcy. Not only will debt settlement companies charge up-front fees, but they will also usually ask for a hefty percentage of each forgiven debt. One Florida debt settlement company asks for an initial service fee that is nearly $7,000 as well as monthly “set-aside” fees that are in the hundreds of dollars. Another debt settlement company retains nearly $6,000 in fees even when they are unsuccessful in settling their client’s debt.
Furthermore, creditors may report the debt forgiveness to the IRS, who can tax you on the full amount of the debt reduction unless you are insolvent.

Finally, debt settlement can leave you in a worse position with creditors than you are in now. Debt settlement companies ask you to default on your debts because many creditors will not negotiate with consumers who are current on their bills. Unfortunately, defaulting can leave you with fines, higher interest rates, potential wage garnishment and even litigation. Once creditors know you are working with a debt settlement company, they are often more aggressive on their debt collection efforts.

Bankruptcy: A Better Option

So what do you do? It can be hard to accept that the “easy way out” — debt settlement — is through a locked door. Yet, there are other, more permanent options; options that can lead you to financial freedom. If you find yourself overwhelmed with debt, consider filing for Chapter 7 or Chapter 13 bankruptcy.
Chapter 7 bankruptcy allows debtors to discharge most of their debts while keeping their home and other exempt assets. Chapter 13 bankruptcy allows debtors to pay back some of their debts through a 3- to 5-year bankruptcy plan and discharge others.

Source: NACBA, “The Debt Settlement Trap: The #1 Threat Facing Deeply Indebted Americans”, Oct. 2012