Debt & Financial Solutions
Ex NBA star Derek Coleman filed for Chapter 7 bankruptcy protection last month. He owed his creditors more than $4.7 million dollars. Derek Coleman was the number one draft pick coming out of high school into the NBA.
The ex-Syracuse University standout and 1991 NBA Rookie of the Year earned tens of millions during a 15-year playing career but listed assets of just $1 million in papers filed with the U.S. Bankruptcy Court in Detroit.
The United States Treasury Department has just unveiled the new $100 bill design to curtail counterfeit.
“This note incorporates the best technology available to ensure we’re staying ahead of counterfeiters,” Geithner said at the unveiling ceremony.
The new bill featuring a security thread decades in development: the microprinted mobile image that has inspired all the Harry Potter chatter. When the bill is moved side to side, the image on the bill appears to move up and down, and it’s moved up and down, the image appears to move side to side.
The new will go into circulation later this year.
I know many of you want to know – what does discharge mean to me? In the world of bankruptcy getting a discharge means that the court is discharging your debts. That means that your creditors can no longer go after you for your debts. At least those that were discharged.
Foreclosures in the month of January was 15% compared to the same month last year. But it is predicted that this number is going to dramatically increase as a surge of cash-strapped homeowners who have fallen behind were on their way.
More than 315,000 homeowner received a foreclosure notice in January. That is less in December (349,000). In January, one in 409 homes were sent default notices
anuary marked the 11th straight month with more than 300,000 properties receiving a foreclosure filing. The numbers could stay above that level as unemployed homeowners who have tried to keep up with their mortgages finally start missing monthly payments.
Mortgage financier Fannie Mae reported in late January that the rate of borrowers who have a conventional loan on a house and are seriously delinquent was 5.29 percent in November, more than doubling the rate of 2.13 percent in November 2008. Borrowers are considered seriously delinquent if they are past due by three months or more, or are in foreclosure.
The dip in January’s numbers may be due to processing delays by lenders during the end-of-year holidays, said Rick Sharga, senior vice president of RealtyTrac, which is based in Irvine, Calif.
Slowing the foreclosure rate is a key step in the recovery of the real estate market and the overall economy. The foreclosure crisis forced the federal government and several states to come up with plans to prevent or delay the process to help delinquent borrowers.
Foreclosed homes are usually sold at steep discounts, so they often lower the value of surrounding properties. Cities lose property tax dollars from foreclosure homes that sit empty and from declining home values, straining local economies. Home prices have stabilized in some cities, but are still down 30 percent nationally from mid-2006.
Economic issues, such as unemployment or reduced income, are expected to be the main catalysts for foreclosures this year. Initially, subprime mortgages were mostly the culprit, but homeowners with good credit who took out conventional, fixed-rate loans are the fastest growing group of foreclosures.
Among states, Nevada posted the nation’s highest foreclosure rate, followed by Arizona, California, Florida and Utah. Rounding out the top 10 were Idaho, Michigan, Illinois, Oregon and Georgia.
The metro area with the highest foreclosure rate in January was Las Vegas, with one in every 82 homes receiving a foreclosure filing. It was followed by Phoenix and the California cities of Modesto, Stockton, and Riverside-San Bernardino-Ontario.
Depending on the state that you reside in, you could be in for a rude awaking if your home was foreclosed upon. For what you asked? Well if your home sold for less than what was owed on your mortgage than you could be liable for the difference. This is known as a deficiency judgment claim.
There are more than 30 states that allow owners of these notes to go after you if they were not able to sell your home for what was owed on the mortgage. These states include, New York, Florida, and Texas.
Some states, such as California, are “non-recourse” and don’t allow deficiency judgments. But, even there, if the original loan was refinanced, some or all of it may be subject to claims.
So make sure you ask for a release from the bank.
Otherwise, you could be face with a lawsuit and harassing letters from collectors because in the next few years, banks will be selling many of these types of accounts to collection agencies and other third parties, at discount.
So there are two things you should take from this: (1) ask for a release and (2) read all your paper work carefully when you agree to allow the bank to take back your home. Make sure you don’t agree or acknowledge any debts because your home is going to be sold for less than what you owe on your mortgage.
With individual bankruptcy filing at record place, it is not too surprising that companies and now state government are following suit.
There is a thought floating around that 46 out of 50 states in American could file for bankruptcy. If that turns out to be true then we might be in for a long ride before the economy begins to pick up and unemployment numbers get better as people find more jobs.
So if you are contemplating filing bankruptcy don’t feel bad. It might be the best thing for you to do for yourself so that you can have a better future.
Bankruptcy filing in 2009 jump 32%. There were more than 1.4 million filings in 2009. The largest number since 2005. Experts believe that 2010 may see even more. There were 116,000 filing in December alone.
The filings reflect the severity of the one of the worst recessions since World War II. In fact, states that suffered most from the real estate bust some of the biggest gains.
Filings in 2005 hit 2 million as many people wanted to get into court before the bankruptcy law was overhauled, pushed by lenders who wanted to make it harder to walk away from debts.
Filings fell to 600,000 in 2006 but have been rising ever since.
Chapter 7 is the bankruptcy relief most often sought. On filing, all assets pass to an estate administered by a trustee, who liquidates all nonexempt assets of value. Creditors can file claims against the assets and the claims are paid in accordance with the Code.
If you are an individual, you can get a discharge of all debts, other than debts declared nondischargeable under 11 USC Section 523, unless a creditor can establish a basis under 11 USC Section 727 to deny your discharge.
Your eligibility for Chapter 7 relief is governed primarily by the “means test” and the credit counseling and other requirements of 11 USC Section 109. The credit education provision require that an individual receive a briefing on available credit counseling opportunities and assistance in performing a budget analysis from an approved, non-profit budget and credit counseling agency during the 180 days before filing for bankruptcy.
You must also complete a instructional personal financial management course before discharge is granted.
The means test is applicable to people with primarily consumer debt. The test is set forth in Bankruptcy Code Section 707(b). Under it, a person may not proceed under Chapter 7 if an objective formula-based analsis of the person’s income and expenses indicates that they will be able to repay some or all of what they owe to unsecured creditors.
If you have desires to retain nonexempt assets then you have to consider Chapter 13.
Timing is frequently an important consideration with respect to the filing of a bankruptcy case. When you have made a transfer to or for the benefit of an insider, you may wish to wait until the one year preference period or the two year statute of limitation has expired.
When you owe state or federal income taxes, you may wish to wait until the three year nondischargeability period has passed.
If you are under considerable pressure from creditors, however, you may not be able to wait. Nevertheless, you should know about the following:
- An inheritance likely to be received witin the 180 day period following the filing of the petition will become property of the estate. In such circumstances, you may be able to take steps to disclaim the inheritance or suggest to the benefactor that the bequest be left to another party, such as your kids.