CHAPTER 13 CLIENTS:
ATTENTION!
ATTENTION! Â ATTENTION!
DO NOT DO RAPID REFUNDS, REFUND ANTICIPATION LOANS (SOMETIMES CALLED
ASSISTED REFUNDS), ETC.
The Trustee will automatically receive your income tax refund from the IRS,
pursuant to an order entered in the US Bankruptcy Court, so paying for a
quicker income tax refund is a waste of your money and time.
YOU CAN FILE YOUR INCOME TAX RETURN FOR FREE! If you earned less than
$57,000 in 2009, you can file your income tax returns for free:
http://www.irs.gov/efile/article/0,,id=118986,00.html?portlet=8
FILE YOUR INCOME TAX RETURN ELECTRONICALLY whenever possible, for it will expedite the processing of your income tax return. Â And if you prepare your
taxes yourself online, the electronic filing is also free.
REVIEW OUR ARTICLE ABOUT INCOME TAX REFUNDS for more details: May
TAX REFUNDS: a Blessing or a Curse?
March 12, 2010
Posted in: Bankruptcy News 
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Restablishing Credit (part 2)
The second easiest way to rebuild your credit is by obtaining a credit card. The two types of credit cards that will typically be available to you after a bankruptcy are high-interest unsecured credit cards and secured cards.
Unsecured cards are the type you eventually want to have so don’t automatically reject them simply because they charge a high interest rate. If you pay off your balance every month, the interest rate is irrelevant anyway. Besides, if you’ve recently received a bankruptcy discharge, you probably won’t qualify for the lower interest rates just yet. In addition, applying for credit for which you can’t possibly be accepted will damage your credit rating even further and likely your ego as well.  In fact, Creditcards.com says, “Shortly after bankruptcy, it makes sense to apply for bad credit cards, rather than to get turned down for offers that are out of your reach.” (Jeremy Simon, 8/18/09) The thing to keep in mind, then, is what are their fees and other charges?
Secured cards are where you give them a deposit of your own money, typically $200-500, and you charge up to that amount. Make sure that the bank will report to the credit bureaus and that it will not be reported as a secured card. Some lenders see a secured card as an unfavorable remark and since the purpose of this card is to help you rebuild your credit, you don’t want to limit your future options because of your current choices. Also find out how long it will be before you are given the option of an unsecured card. That’s usually a year, but each bank is different.
Bankrate.com offers you comparisons on secured cards:
http://www.bankrate.com/funnel/credit-cards/credit-card-results.aspx
Always read the fine print. That’s generally called “Terms & Conditions” on the card issuer’s website. The other terms to keep in mind when comparing secured or unsecured cards are:
- How much is their annual fee? The average is $20-30.
- Is there at least a 20-25 day grace period if the balance is paid in full every month? If not, then you’ll be paying interest from the date of purchase, so this point is huge.
- What is their interest rate? Even if you’ll be paying off your balance in full every month, you still want the lowest rate possible. The median rate as of 3/2/09 was 19.07% (Bankrate.com).
- Review all of their eligibility requirements (or ask if they’re not posted) before you apply, because you can be denied for even a secured card.
Read more tips like these in our many newsletters- http://groups.google.com/group/BankruptcyNewsletter
March 11, 2010
Posted in: Bankruptcy News No Comments
Mike’s Monday: Credit card reform
By MIKE THOMPSON
FREE PRESS CARTOONIST
March 9, 2010
Posted in: Bankruptcy News No Comments
List of Celebrities’ Bankruptcy Filings
|
Name of Celebrity |
Occupation |
Date Filed |
Location Filed |
Chapter Filed |
Name of Attorney |
| Stephen Baldwin | Actor/Minister | July 2009 | Rockland County, NY | Chapter 11 | Bruce Weiner – Rosenberg Musso & Weiner) |
| Lorraine Bracco | Actor | June 1999 | Rockland County, NY | Chapter 13 | |
| Bill Buckner | Baseball Player | 2008 | Idaho | ||
| Jose Conseco | Baseball Player | 2008 | Los Angeles, CA | Chapter 7 | Gregory Emerson. |
| Barry Corbin | Actor | 2009 | Fort Worth, TX | St. Clair Newbern III. | |
| Lenny Dykstra | Baseball Player | 2008 | Diamond Bar, CA | Chapter 11 | Walter Hackett. – The Law Offices of Walter Hackett |
| Rollie Fingers | Baseball Player | 1989 | San Diego, CA | Chapter 7 | |
| Tony Gwynn | Baseball Player | 1988 | San Diego, CA | ||
| Marion “Suge” Knight | Record Producer | October 2008 | Los Angeles, CA | Chapter 11 | Daniel McCarthy. – Hill, Farrer & Burrill LLP; Creditors’ Committee – Debra Grassgreen.– Pachulski Stang Ziehl Young Jones & Weintraub |
| Bernie Kosar | Football Player | June 2009 | Fort Lauderdale, FL | Chapter 7 (converted from Chapter 11) | Julianne R. Frank. – Frank, White-Boyd, P.A. |
| Lorenzo Lamas | Actor | 2004 | Los Angeles, CA | Joseph Eisenberg. – Jeffer, Mangels, Butler & Marmaro LLP | |
| Stan Lee | Comic Book Artist and Mogul | 2001 | Los Angeles, CA | Chapter 11 | Levene, Neale, Bender, Rankin & Brill LLP |
| Ed McMahon | TV Host/Personality | June 2008 | Los Angeles, CA | ||
| Vince Neil | Singer, Motley Crue | 1998 | Los Angeles, CA | Chapter 7 | Joseph Eisenberg. – Jeffer, Mangels, Butler & Marmaro LLP |
| Gaylord Perry | Baseball Player | 1986 | Martin County, NC | Chapter 7 | |
| Randy Quaid | Actor | 2000 | Houston, TX | Chapter 7 | Dick DeGuerin, – DeGuerin & Dickson |
| Sinbad (aka David Adkins) | Comedian/Actor | 2009 | Los Angeles, CA | Chapter 7 | |
| Donald Trump | Real Estate Mogul | 2004, 2009 | New York, NY | Chapter 11 | Philip Rosen, Ted Waksman, and Michael Walsh.– Weil, Gotshal & Manges LLP |
| Mike Tyson | Boxer | 2003 | Los Angeles, CA | Chapter 11 | Maria Bove, Malhar Pagay, Robert Feinstein., and Debra Grassgreen.– Pachulski Stang Ziehl Young Jones & Weintraub |
| Michael Vick | Football Player | 2008 | Newport News, VA | Chapter 11 | Michael Blumenthal – Crowell Moring LLP |
March 5, 2010
Posted in: Bankruptcy News No Comments
Re-establishing Credit-Facts and Tips (part one)
Re-establishing your credit by obtaining new credit can only begin after your bankruptcy case is discharged as credit card usage is prohibited while you’re in bankruptcy. Raising your credit score takes time so we recommend you begin working on it as soon as your case is done. If you wait, you might not have the score you need when you need it for an automobile loan or mortgage. The easiest way to improve your credit is to just continue what you’ve been doing.
Every month that you pay your car, student loan and mortgage payments on time, you’re raising your credit score just a little bit. The balance on the vehicle loan will reduce every month, which decreases your balance to credit limit ratio thereby increasing your score. We recommend that you even make the payments a few days early, and always give at least 5 days delivery time if sending a check through the US mail. If possible, send in extra money to reduce the principal which will result in less overall interest. Send in a separate check and note that it is for “Principal Only” so it will be applied correctly to your account. But only send in that extra if you’ve already paid yourself first.
If you’ve been reading our Money Magic series, you know that to begin making “money magic” you must first pay yourself by saving every month so you’ll have the money when the inevitable medical and repair expenses arise.  So if you have a nice cushion of at least $1,000, you might want to pay extra on your automobile or student loan. Otherwise, you’re probably better off putting the extra funds in your account, rather than your bank’s.
Find more tips and facts just like this in our monthly newsletter. Sign up or view here: http://groups.google.com/group/BankruptcyNewsletter
March 2, 2010
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U.S. mortgage delinquencies at new high
Aarthi SivaramanAmong U.S. homeowners with mortgages, 7.91 percent were at least 30 days late on payments in November, up from 7.76 percent in October, according to the monthly data the credit bureau provided exclusively to Reuters on Wednesday.
Delinquencies are an indication of future consumer bankruptcy filings, according to Equifax.
“(Consumers) spend a lot more during November and December and they get behind and can’t get to their payments,” said Myra Hart, senior vice president of Analytical Services at Equifax.
No real improvement is possible until unemployment levels come down, she said in an interview.
“We are about at the peak in terms of delinquencies,” Hart said. “Things probably won’t improve dramatically until jobs begin to be added. Delinquencies will stay at this level and may improve by small levels but we won’t see any real improvement till 2011.”
Delinquencies are worse than in previous years. Equifax data showed that 5.83 percent of mortgages were at least 30 days past due in November 2008, and 3.93 percent were past due in November 2007.
Read more HERE
February 26, 2010
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Millions More Are At Risk Of Foreclosure Than Anyone Realizes
Mark Hanson | Dec. 7, 2009, 5:45 AM
Most look to loan type and equity position as two of the most important factors when forecasting loan default. In fact, I believe that epidemic negative-equity is the overarching reason that the default, foreclosure and housing crisis remains in the early innings. But…negative-equity with a caveat.
While negative equity is a threat in and of itself, being in an over-leveraged household debt position is the true default catalyst for most in a negative-equity position. And being over-leveraged is also the primary default catalyst for those is a positive equity position. Being in a negative-equity position with lots of top line and disposable income each month is generally more of a mental burden than a reason to fly the coop.
How many homeowners are over-levered and at eminent risk of default? This answer is…a lot more than most think, especially those who got a loan from 2003-2007 due to a radical, yet subtle shift in loan guidelines across the mortgage spectrum that kicked-off the bubble-years.
Yes, even Prime full-doc borrowers in 30-year fixed mortgages with 20% equity who got their purchase or refi from 03-07 are at much greater risk than most think. Being over-levered was condoned – all the lenders, investors and loan programs operated in the same manner.
February 22, 2010
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The $555,000 Student-Loan Burden
Tuesday, February 16, 2010
from:
When Michelle Bisutti, a 41-year-old family practitioner in Columbus, Ohio, finished medical school in 2003, her student-loan debt amounted to roughly $250,000. Since then, it has ballooned to $555,000.
 Andrew Spear for The Wall Street Journal |
| Michelle Bisutti borrowed $250,000 to pay for medical school. The debt has since ballooned to $555,000. |
It is the result of her deferring loan payments while she completed her residency, default charges and relentlessly compounding interest rates. Among the charges: a single $53,870 fee for when her loan was turned over to a collection agency.
“Maybe half of it was my fault because I didn’t look at the fine print,” Dr. Bisutti says. “But this is just outrageous now.”
To be sure, Dr. Bisutti’s case is extreme, and lenders say student-loan terms are clear and that they try to work with borrowers who get in trouble.
Read more HERE
February 17, 2010
Posted in: Bankruptcy News No Comments
New Treasury Rules to Protect Benefits
Moves Could Keep Banks From Seizing Social Security
By ELLEN E. SCHULTZ (Wall Street Journal)The Treasury Department is seeking to plug a loophole that has allowed banks to drain millions of dollars in fees from the Social Security benefits of elderly and disabled customers.
At issue are the accounts of customers whose Social Security benefits are deposited directly from the government to banks. When banks receive garnishment orders from creditors, many freeze the customers’ accounts, even when accounts contain only Social Security.
Federal law bars creditors from taking Social Security to recover a debt, but when they send garnishment orders seeking money in people’s bank accounts, the rules currently don’t specify what banks should do.
Read more here
William Starling for The Wall Street Journal
Floyd Morell, a 57-year-old disabled church
musician, with his dog Papi outside his home
in Loxley. Ala.
February 15, 2010
Posted in: Bankruptcy News One Comment
How are Modifications Programs Doing?
On November 30th 2009 The Treasury Department announced it intended to increase the pressure put on lenders and services to move those with a trial loam modification to a full blown restructured loan.
Over the past few months the government has been telling tales of success in the trial modification program. However, over 650,000 borrowers entered the program in October and a very small percentage have permanent restructured loans or loan modification. To combat these figures the Treasury Department planned to assign officials to monitor the larger of the mortgage servicing companies on a daily basis. This was an effort to determine exactly what it will require to develop and report plans to increase the completion of loan modifications.
Experts are saying that banks are simply not doing a good enough job when it comes to the modification process. Michael S. Barr was quoted in the Wall Street Journal as saying” Some of the firms ought to be embarrassed and they will be. They’re not getting a penny from the Federal Government until they move forward”. Barr furthers his point by asserting that the government will publicly identify lenders and servicers who are not preforming well under the program guidelines.
Foreclosures are on the rise and are still hitting families who have suffered job losses, medical debt, or other financial issues. Some families are to the point they can not afford payments that have been modified under the program. This leads one to wonder if this is a flaw in the program’s guidelines or the lenders and banks who issue the loans.
Will this program work? No one can say for sure.
February 11, 2010
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