Saturday, February 18, 2012
Cheap Credit Counseling- Pre-Filing Course
Consumer Bankruptcy Counseling is now available for $5 from the website: http://www.consumerbankruptcycounseling.info/. In 2005, Congress required all individuals wishing to file bankruptcy to first undergo a “Credit Counseling”. Bankruptcy credit counseling takes about an hour and is now a primarily automated process. The standard fee charged by most authorized credit counselors is between $30 and $50. The low cost does come with some minor delay in issuance of the required certificate. They do not provide same day service and there are no operators “standing by” on a toll free line to handle technical problems. This program has received authorization from the Executive Office for United States Trustee, United States Department of Justice, to service all federal Districts except for the District of Alabama and the District of North Carolina, to provide credit counseling and to issue certificates in compliance with the Bankruptcy Code. Approval does not endorse or guarantee the quality of any Agency's services.
In the News
The average 30-year fixed-rate mortgage is still at an all-time low of 3.87 percent and it's been there since the first week of February, according to the weekly market survey published by Freddie Mac. The 30-year average has managed to remain below 4 percent for the past 11 weeks, and below 5 percent for the past 52 weeks, dating back to February 17, 2011. The 15-year rate was also unchanged in the GSE's study, while the 5-year adjustable rate posted a slight decline and the 1-year adjustable rate increased. http://www.dsnews.com/articles/rates-stay-low-with-30-year-fixed-below-4-2012-02-16
CitiMortgage, a subsidiary of CitiBank, agreed to pay $158.3 million due to claims that the bank failed to comply with HUD and FHA requirements in underwriting loans for federal insurance, and for stating certain loans were eligible for FHA's mortgage insurance program when they were not. As a result of these actions, HUD incurred losses from defaulted loans that should not have been approved. CitiMortgage accepted responsibility for specific actions including failing to conduct a full review of certain loans it endorsed. http://www.dsnews.com/articles/citi-pays-1583-million-due-to-faulty-fha-insurance-claims-2012-02-16
PONCE V. BCA FINANCIAL SERVICES, INC. (11th CIR.)
The 11th Circuit handed down a summary judgment on claims under Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., and affirmed that (a) a letter sent to an invalid address was not "initial communication" but rather later phone call was initial communication that was not followed by required written notice within 5 days, (b) a call to a third party to locate the debtor failed to include required disclosure, and (c) the debt collector's statement based on general knowledge of insurance practices and not specific knowledge of the debtor's circumstances was "false, deceptive, or misleading representation" under the applicable "least sophisticated consumer" standard.
ELIMINATION OF BNC NOTICE OF MEETING OF CREDITORS TO DEBTORS’ ATTORNEYS
On December 5, 2011, the court began operations under Bankruptcy CM/ECF Release 4.2. Release 4.2 will support an additional noticing-related improvement provided by the court’s Bankruptcy Noticing Center (BNC) contractor.
Previously, you received the notice of 341 meeting of creditors by Notice of Electronic Filing (NEF) with the debtor's redacted Social Security Number (SSN), and by U.S. Mail through the BNC with the debtor’s full SSN. The improvement provided with CM/ECF Release 4.2 will allow the BNC to send you an email containing a secure hyperlink to the unredacted 341 notice in place of a paper notice. The BNC will send one summary email per day containing hyperlinks to one or more notices. Each hyperlink provides one free look to the full notice. You will no longer receive the paper 341 notice from the BNC.
A sample BNC email notification is provided at the following web page: http://ebn.uscourts.gov/documents/Attorney341Email.pdf
CitiMortgage, a subsidiary of CitiBank, agreed to pay $158.3 million due to claims that the bank failed to comply with HUD and FHA requirements in underwriting loans for federal insurance, and for stating certain loans were eligible for FHA's mortgage insurance program when they were not. As a result of these actions, HUD incurred losses from defaulted loans that should not have been approved. CitiMortgage accepted responsibility for specific actions including failing to conduct a full review of certain loans it endorsed. http://www.dsnews.com/articles/citi-pays-1583-million-due-to-faulty-fha-insurance-claims-2012-02-16
PONCE V. BCA FINANCIAL SERVICES, INC. (11th CIR.)
The 11th Circuit handed down a summary judgment on claims under Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., and affirmed that (a) a letter sent to an invalid address was not "initial communication" but rather later phone call was initial communication that was not followed by required written notice within 5 days, (b) a call to a third party to locate the debtor failed to include required disclosure, and (c) the debt collector's statement based on general knowledge of insurance practices and not specific knowledge of the debtor's circumstances was "false, deceptive, or misleading representation" under the applicable "least sophisticated consumer" standard.
ELIMINATION OF BNC NOTICE OF MEETING OF CREDITORS TO DEBTORS’ ATTORNEYS
On December 5, 2011, the court began operations under Bankruptcy CM/ECF Release 4.2. Release 4.2 will support an additional noticing-related improvement provided by the court’s Bankruptcy Noticing Center (BNC) contractor.
Previously, you received the notice of 341 meeting of creditors by Notice of Electronic Filing (NEF) with the debtor's redacted Social Security Number (SSN), and by U.S. Mail through the BNC with the debtor’s full SSN. The improvement provided with CM/ECF Release 4.2 will allow the BNC to send you an email containing a secure hyperlink to the unredacted 341 notice in place of a paper notice. The BNC will send one summary email per day containing hyperlinks to one or more notices. Each hyperlink provides one free look to the full notice. You will no longer receive the paper 341 notice from the BNC.
A sample BNC email notification is provided at the following web page: http://ebn.uscourts.gov/documents/Attorney341Email.pdf
Tax Forgiveness on that 1099
Obama’s FY2013 budget proposal includes an extension of the Mortgage Forgiveness Debt Relief Act of 2007.
The Act ensures that homeowners who received principal reductions or other forms of debt forgiveness on their primary residences do not have to pay taxes on the amount forgiven. The administration is proposing an extension that would apply to any amounts forgiven before January 1, 2015.
The Act ensures that homeowners who received principal reductions or other forms of debt forgiveness on their primary residences do not have to pay taxes on the amount forgiven. The administration is proposing an extension that would apply to any amounts forgiven before January 1, 2015.
Robosigner Settlement
Consumers who want their foreclosure cases checked by a third party as part of federal regulators' independent foreclosure review directive now have until July 31, 2012, to submit their requests. The Federal Reserve and the Office of the Comptroller of the Currency announced Wednesday that the deadline has been pushed out by three months to give consumers more time to file for a case assessment if they believe they suffered financial injury as a result of errors in foreclosure actions in 2009 or 2010.
Participating servicers include:
• America’s Servicing Company
• Aurora Loan Services
• BAC Home Loans Servicing
• Bank of America
• Beneficial
• Chase
• Citibank
• CitiFinancial
• CitiMortgage
• Countrywide
• EMC
• Everbank/Everhome Mortgage Company
• Financial Freedom
• GMAC Mortgage
• HFC
• HSBC
• IndyMac Mortgage Services
• MetLife Bank
• National City Mortgage
• PNC Mortgage
• Sovereign Bank
• U.S. Bank
• Wachovia Mortgage
• Washington Mutual
• Wells Fargo
• Wilshire Credit Corporation
Borrowers are eligible for a foreclosure review if their loan is serviced by one of the participating companies above, the mortgage loan was subject to foreclosure between January 1, 2009 and December 31, 2010, and the property securing the mortgage was the borrower’s primary residence.
Participating servicers include:
• America’s Servicing Company
• Aurora Loan Services
• BAC Home Loans Servicing
• Bank of America
• Beneficial
• Chase
• Citibank
• CitiFinancial
• CitiMortgage
• Countrywide
• EMC
• Everbank/Everhome Mortgage Company
• Financial Freedom
• GMAC Mortgage
• HFC
• HSBC
• IndyMac Mortgage Services
• MetLife Bank
• National City Mortgage
• PNC Mortgage
• Sovereign Bank
• U.S. Bank
• Wachovia Mortgage
• Washington Mutual
• Wells Fargo
• Wilshire Credit Corporation
Borrowers are eligible for a foreclosure review if their loan is serviced by one of the participating companies above, the mortgage loan was subject to foreclosure between January 1, 2009 and December 31, 2010, and the property securing the mortgage was the borrower’s primary residence.
Articles of Interst
http://www.law.com/jsp/cc/PubArticleCC.jsp?id=1202542426714
http://www.dsnews.com/articles/hidden-gems-freddie-macs-refinance-activity-reports-2012-02-15
http://www.mondaq.com/unitedstates/x/164712/Appellate/WWJDUnited+States+v+Jones&email_access=on
On January 23, 2012 the Supreme Court released its opinion in United States v. Jones--the GPS surveillance case
http://www.mondaq.com/unitedstates/x/164778/Information+Technology+Law/Electronic+Etiquette&email_access=on
http://www.dsnews.com/articles/hidden-gems-freddie-macs-refinance-activity-reports-2012-02-15
http://www.mondaq.com/unitedstates/x/164712/Appellate/WWJDUnited+States+v+Jones&email_access=on
On January 23, 2012 the Supreme Court released its opinion in United States v. Jones--the GPS surveillance case
http://www.mondaq.com/unitedstates/x/164778/Information+Technology+Law/Electronic+Etiquette&email_access=on
Means Test Chapter 13
For a detailed explanation of the Means Test you might want to read The Bankruptcy Means Test Explained In English.
One of the biggest problems with the Means Test (and there are many!) is that if you have over a certain amount of Disposable Income ($182.50 in current monthly income available after allowed deductions, which equals $10,950 over five years) you are presumed to be abusing the Bankruptcy system by filing a Chapter 7 bankruptcy.
Because the Means Test takes a cookie cutter, one size fits all approach to expenses. Some examples:
• You are only permitted to claim $147.92 per month per child under the age of 18 for educational expenses, and you are going to have to have documentation to support those expenses.
• If you must be in a Chapter 13, you must be in it for 60 months if you are a an above means debtor. If you own an older vehicle and don’t have a car note, you can only claim an additional $250.00 per month for maintenance expenses. If you want to purchase a vehicle during your chapter 13 you must have approval from the trustee. You might be allowed a car payment of about $350 a month.
• In a Chapter 13 bankruptcy you are permitted to treat your withholding for retirement plans such as 401K expenses as an expense for your health and welfare, but you are not permitted to claim this expense in a Chapter 7 bankruptcy.
One of the biggest problems with the Means Test (and there are many!) is that if you have over a certain amount of Disposable Income ($182.50 in current monthly income available after allowed deductions, which equals $10,950 over five years) you are presumed to be abusing the Bankruptcy system by filing a Chapter 7 bankruptcy.
Because the Means Test takes a cookie cutter, one size fits all approach to expenses. Some examples:
• You are only permitted to claim $147.92 per month per child under the age of 18 for educational expenses, and you are going to have to have documentation to support those expenses.
• If you must be in a Chapter 13, you must be in it for 60 months if you are a an above means debtor. If you own an older vehicle and don’t have a car note, you can only claim an additional $250.00 per month for maintenance expenses. If you want to purchase a vehicle during your chapter 13 you must have approval from the trustee. You might be allowed a car payment of about $350 a month.
• In a Chapter 13 bankruptcy you are permitted to treat your withholding for retirement plans such as 401K expenses as an expense for your health and welfare, but you are not permitted to claim this expense in a Chapter 7 bankruptcy.
Articles of Interest
http://blogs.wsj.com/developments/2012/02/16/huds-donovan-fannie-freddie-should-embrace-loan-forgiveness/tab/print/
http://www.law.com/jsp/law/sign_me_in.jsp?article=http%3A%2F%2Fwww.law.com%2Fjsp%2Fnlj%2FPubArticleNLJ.jsp%3Fid%3D1202542577723&et=editorial&bu=Law.com&cn=nw20120217&src=EMC-Email&pt=LAWCOM%20Newswire&kw=Feds%20Want%20New%20Rules%20for%20Debt%20Collectors%2C%20Reporting%20Agencies&slreturn=1
http://www.bloomberg.com/news/print/2012-02-16/consumer-bureau-to-supervise-debt-collectors.html
http://www.dsnews.com/articles/hidden-gems-freddie-macs-refinance-activity-reports-2012-02-15
http://www.mondaq.com/unitedstates/x/164712/Appellate/WWJDUnited+States+v+Jones&email_access=on
On January 23, 2012 the Supreme Court released its opinion in United States v. Jones--the GPS surveillance case
http://www.mondaq.com/unitedstates/x/164778/Information+Technology+Law/Electronic+Etiquette&email_access=on
http://www.law.com/jsp/law/sign_me_in.jsp?article=http%3A%2F%2Fwww.law.com%2Fjsp%2Fnlj%2FPubArticleNLJ.jsp%3Fid%3D1202542577723&et=editorial&bu=Law.com&cn=nw20120217&src=EMC-Email&pt=LAWCOM%20Newswire&kw=Feds%20Want%20New%20Rules%20for%20Debt%20Collectors%2C%20Reporting%20Agencies&slreturn=1
http://www.bloomberg.com/news/print/2012-02-16/consumer-bureau-to-supervise-debt-collectors.html
http://www.dsnews.com/articles/hidden-gems-freddie-macs-refinance-activity-reports-2012-02-15
http://www.mondaq.com/unitedstates/x/164712/Appellate/WWJDUnited+States+v+Jones&email_access=on
On January 23, 2012 the Supreme Court released its opinion in United States v. Jones--the GPS surveillance case
http://www.mondaq.com/unitedstates/x/164778/Information+Technology+Law/Electronic+Etiquette&email_access=on
Thursday, December 22, 2011
ARMs are Bad !
A Adjustable Rate Mortgage is bad- no matter how you package it. Most of my chapter 13 homes are either purchased between 2005-2009 during the bubble or their ARMS. Just say NO and get a fixed rate.
Two new packagings for ARMS are:
A 2/28 Mortgage is an adjustable rate mortgage loan where interest is paid for two years at a relatively low rate, and then the interest rate “floats,” or changes, upwards.
With a 50 Year Mortgage the lender gives you a fixed introductory rate for five years, followed by an adjustable rate mortgage for the remaining 45 years
Two new packagings for ARMS are:
A 2/28 Mortgage is an adjustable rate mortgage loan where interest is paid for two years at a relatively low rate, and then the interest rate “floats,” or changes, upwards.
With a 50 Year Mortgage the lender gives you a fixed introductory rate for five years, followed by an adjustable rate mortgage for the remaining 45 years
Home Sales
Economists and real estate experts project U.S. home prices to bottom out late next year or in early 2013, according to Zillow's Home Price Expectations Survey. http://zillow.mediaroom.com/index.php?s=159&item=252'
Shadow Inventory
The number of distressed properties not currently listed on multiple listing services stood at 1.6 million as of October 2011, according to CoreLogic. This shadow inventory is approximately half of the industry's visible inventory, the company says, meaning for every two homes available for sale, there is one home in the "shadows." CoreLogic's latest shadow inventory assessment represents a supply of five months and is down from October 2010, when it stood at 1.9 million units, or 7-months' supply. http://www.dsnews.com/articles/for-every-two-homes-sale-there-is-one-in-shadows-2011-12-21 Currently, Florida, California, and Illinois account for more than a third of the shadow inventory, CoreLogic reports. The top six states, which would also include New York, Texas, and New Jersey, are home to half of the shadow inventory.
Pay the Mortgage Before you Shop!
There’s often a balloon in bankruptcy and foreclosures soon after Christmas in part because people “skip a payment” to buy presents. This is never a good idea and now it is even worse. First, if you want to keep your home, the mortgage comes before virtually everything. I tell my clients it comes before they eat!! I know try explaining that to the spouse not handling the budget or the kids.
It may be satisfying to pay several smaller bills first — feels like solving problems, right? — but if the biggest bill you didn’t pay was your mortgage then your problems are getting worse, not better.
It is easy to think “well, I’ll make this up next month, I don’t want to disappoint the kids.” The problem is that you won’t be making more money next month . Your expenses will be the same or maybe higher, given the prices of food, gas and electricity. So where will the “make-up” payment come from? If you are not already in the “Robbing Peter to Pay Paul” cycle, this could start it. Remember the old adage can I pay my Visa with my mastercard?
It is easy for me to sit back and suggest disappointing the kids during the holidays. They’re not my kids. My son would not understand, he's six though and is satisfied with jacks.
Perhaps keeping a roof over their heads is a worthy goal as well. Also teaching the lesson of taking care of “needs” before “wants” could be the best present you can give them this year.
If you do plan on filing bankruptcy in the new year wait three month from your last Holiday shopping and do not use those cards in the mean time.
It may be satisfying to pay several smaller bills first — feels like solving problems, right? — but if the biggest bill you didn’t pay was your mortgage then your problems are getting worse, not better.
It is easy to think “well, I’ll make this up next month, I don’t want to disappoint the kids.” The problem is that you won’t be making more money next month . Your expenses will be the same or maybe higher, given the prices of food, gas and electricity. So where will the “make-up” payment come from? If you are not already in the “Robbing Peter to Pay Paul” cycle, this could start it. Remember the old adage can I pay my Visa with my mastercard?
It is easy for me to sit back and suggest disappointing the kids during the holidays. They’re not my kids. My son would not understand, he's six though and is satisfied with jacks.
Perhaps keeping a roof over their heads is a worthy goal as well. Also teaching the lesson of taking care of “needs” before “wants” could be the best present you can give them this year.
If you do plan on filing bankruptcy in the new year wait three month from your last Holiday shopping and do not use those cards in the mean time.
Do you owe what I owe?
I found this on the web:
St. Louis bankruptcy attorney Wendell Sherk published his riff on a popular Christmas song – Do You Owe What I Owe?
(To the tune of “Do You Hear What I Hear?”)
Said the neighbor to the young man,
“Do you owe what I owe?
Bills up to the sky, young man,
Do you see what I see?
A choice, a choice, waiting in the night
A new start to end the year alright,
A fresh start for a New Year’s Night.”
Said the collector to the young man,
“I know what you owe,
Bills up to the sky, little debtor man,
Do you hear what I say?
Pay what you can’t pay, little debtor man!
With a voice as big as the sea,
With a voice as big as the sea.
Said the young man to the lawyer kind,
“Do you know what I owe?
In your palace warm, lawyer man,
Do you know what I owe?
An arm, a leg, I’ll be out in the cold–
Help me save a little silver, or gold,
Help me save a little silver, or gold.”
Said the judge to the people everywhere,
“Listen to what I say!
Be at peace, people, everywhere,
Listen to what I say!
A fresh start, a new start, waiting in the night
To bring you peace and goodness,
To bring you quiet in the night.”
With apologies to Noel Regney & Gloria Shayne Baker
http://www.bankruptcylawnetwork.com/a-bankruptcy-riff-on-christmas-songs/
St. Louis bankruptcy attorney Wendell Sherk published his riff on a popular Christmas song – Do You Owe What I Owe?
(To the tune of “Do You Hear What I Hear?”)
Said the neighbor to the young man,
“Do you owe what I owe?
Bills up to the sky, young man,
Do you see what I see?
A choice, a choice, waiting in the night
A new start to end the year alright,
A fresh start for a New Year’s Night.”
Said the collector to the young man,
“I know what you owe,
Bills up to the sky, little debtor man,
Do you hear what I say?
Pay what you can’t pay, little debtor man!
With a voice as big as the sea,
With a voice as big as the sea.
Said the young man to the lawyer kind,
“Do you know what I owe?
In your palace warm, lawyer man,
Do you know what I owe?
An arm, a leg, I’ll be out in the cold–
Help me save a little silver, or gold,
Help me save a little silver, or gold.”
Said the judge to the people everywhere,
“Listen to what I say!
Be at peace, people, everywhere,
Listen to what I say!
A fresh start, a new start, waiting in the night
To bring you peace and goodness,
To bring you quiet in the night.”
With apologies to Noel Regney & Gloria Shayne Baker
http://www.bankruptcylawnetwork.com/a-bankruptcy-riff-on-christmas-songs/
Tuesday, December 20, 2011
Termination of the state-wide Residential Mortgage Foreclosure Mediation (RMFM) Program as of 12/20/11
Per the Supereme Court AOSC11-44 signed 12/19/11 the statewide mediation program is cancelled effective today.
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