All items from The BK blog

collection lawsuit millThe Consumer Financial Protection Bureau (a federal agency) has filed a lawsuit in federal district court against Frederick J. Hanna & Associates and its three principal partners for operating a “collection lawsuit mill” that uses illegal tactics to intimidate consumers into paying debts they may not owe.According to the CFPB, Hanna & Associates violated federal law which prohibits deceptive practices in the consumer financial marketplace. The Agency wants compensation for victims, a civil fine and an injunction against the firm and its partners.The allegations in the complaint include:



Posted 6 weeks 3 days ago

stay violation distress claimOn May 8, 2014 the 11th Circuit Court of Appeals released an interesting ruling denying a claim for damages filed by Chapter 13 debtors against their mortgage company. The Lodge v. Kondaur Capital Corporation and McCalla Raymer arose when a mortgage company started foreclosure proceedings against Mr. & Mrs. Lodge who were then debtors in an active Chapter 13 case.Under the automatic stay provision of the Bankruptcy Code, of course, lenders cannot initiate or continue collection activity against a debtor who has filed Chapter 13 unless and until the lender first convinces the bankruptcy judge to lift the automatic stay.In Georgia, most foreclosures are non-judicial meaning that to start foreclosure a lender needs to notify the debtor and run a written notice of the pending foreclosure in the legal newspaper of the county where the property is located. In the Lodge case, the mortgage company started the foreclosure process and bought the ad.



Posted 10 weeks 2 days ago

elimination of debtI recently received this email from a prospective client (“Jane”) seeking to have her student loans discharged in bankruptcy.  Do you see the problems with this case?I am permanently disabled due to cognitive decline resulting from a craniotomy to repair one of three aneurysms. I also suffer from back pain, anxiety, depression and panic attacks. In addition to my 2012 brain and gallbladder surgeries, I underwent back surgery in 2011 and two foot surgeries in 2010, and due to complications from my back surgery I have not been able to return to work. . I was very recently approved for disability retirement after 25 years as an employee with the federal government.  I also receive SSI.   I filed a chapter 7 in 2008 and am unsure what my options are in regard to having my student loans forgiven. I am seeking a full discharge.



Posted 25 weeks 3 days ago

judgment creditorAlmost without exception my clients who are subject to wage garnishment in Georgia report that they feel “violated” or “horrified” by discovering that 25% of their take home pay 1 has been seized by a creditor.  I can certainly understand this emotion – especially if you depend on every penny of your paycheck to cover monthly expenses like rent, utilities, car payments and insurance costs.How Wage Garnishment Happens in GeorgiaWith limited exceptions, you can only be wage garnished in Georgia if your creditor has first filed a lawsuit and obtained a judgment.  More than a few of my garnishment clients claim that they do not remember being sued – this is an issue for another blog post but anytime you find out that a sheriff’s deputy or process server is looking for you, it is time to take action because this means that you have been sued.



Posted 29 weeks 2 days ago

employer deduction order in chapter 13Have you made the decision to file a Chapter 13 bankruptcy?  If so, you should understand that Chapter 13 serves as a bankruptcy court approved and supervised payment plan.  The court approved and supervised part is important because the bankruptcy court will protect you from creditor actions as long as you stay current with your plan.  By contrast, non-court supervised payment plans offer no legal protection – even if you pay every month on time payment plans that are not Chapter 13 will not stop lawsuits, wage garnishments, bank levies, vehicle repossessions or foreclosures.



Posted 30 weeks 4 days ago

avoid future debt problemsI enjoy meeting with my clients to discuss solutions to debt problems.  And over the years I have met some really pleasant and interesting people.  That being said, I hope that when your bankruptcy case is over, I will never see you again – at least for another bankruptcy filing. If you win the lottery and need legal help setting up a charitable foundation or a corporate structure to organize your investments, please call me.   If you know someone who needs to file an injury claim, I can help you there too.  But I really hope that this bankruptcy case will be your last. Here are several suggestions that will absolutely help you avoid the need to file another bankruptcy: 

  • set up online access to your credit accounts – you will be able to schedule payment reminders, fraud alerts and other control reminders.

 



Posted 34 weeks 4 days ago

 exchange secured debt for unsecured debtThe New York Times recently ran an article in its business section entitled The Risk of Transferring a Car Loan to a Credit Card.  The Times reported noted that several credit card issuers now promote programs in which you can transfer the outstanding balance on your car loan to a credit card. 



Posted 36 weeks 5 days ago

 non-judicial foreclosure + GeorgiaThe Atlanta newspaper recently published an article reporting that over 40% of homes in the metro Atlanta area are “underwater,” meaning that they are worth less than what is owed.  In such a climate, homeowners faced with years of payments on real estate with no chance for even a break even sale, much less profit are deciding to simply walk away.Abandoned homes, of course, cause neighborhood values to decline even more, continuing the downward cycle.   Presumably, at some point property values will level off but it may take years, if ever, for values to rise to pre-2008 levels.



Posted 38 weeks 6 days ago

bankruptcy filing considerationsJust over three years ago, I received a phone call from an old acquaintance who seemed extremely stressed out.   This gentleman had previously been in sales and I had done business with him over 20 years ago.   During our dealings we had discovered that we shared several mutual friends and over the years I had run into him several times on social occasions.Now, he needed advice about some significant debt problems.  His small business was failing and he owed tens of thousands of dollars to multiple creditors.   After reviewing his paperwork I suggested that Chapter 7 would work and should be considered.   My friend agreed but did not want to file because he felt very guilty about not paying back his debts.For the next two and a half years, I would talk to my old friend on the phone about his debt problems.   He was sued by several creditors but because he was unemployed there were no wages to garnish.   He had no bank account so the judgments just sat there waiting for his financial situation to improve.



Posted 41 weeks 12 hours ago

Man shoutingLast week, a former client called and tried to refer me a new Chapter 13 client who was facing foreclosure.  While I appreciated the referral, I could not take the case because the potential client was calling from out of town at 5pm on the Monday before his house was schedule to be sold at a foreclosure sale on the courthouse steps.  The potential client did not have a credit counseling certificate and because he had filed before twice, the automatic stay would not go into effect even if he did file.



Posted 41 weeks 3 days ago