Understanding the Pros and Cons of Credit Cards

Florida is open for business once again and as people start emerging from their homes more and more, they are making up for lost time. On average, Floridians carry six credit cards and about $8,800 in debt, which is an increase of $409. That places Florida in third place for states that have the highest credit card debt, with only California and Texas outranking the Sunshine State.

Any increase in credit card debt is concerning, but that does not mean people should stop using credit altogether. While people do tend to focus on the dangers credit cards pose, they also bring many benefits, as well.

The Pros of Credit Cards

Credit cards can become a real challenge if they are not used properly, but the benefits they hold are undeniable. Most businesses today accept credit cards, meaning you do not have to stop at a bank machine to get cash every time you wish to make a purchase. In addition to this, credit cards have other advantages too, which are as follows:

• Pay over time: It is always advised that you pay off your credit card balance in full every month so you can avoid late fees and added interest. However, the option to make payments is certainly helpful, particularly when you want to make a large purchase but do not have the cash available at the moment.
• Reward cards: Many credit cards give borrowers rewards such as cashback, air miles, and gift cards. You will receive more rewards the more you use the cards and you can either redeem them, or save them up so they accumulate into a greater amount.
• Introductory rates: It is not uncommon for credit card companies to offer introductory rates that are much lower than the standard rates. You may find a card that offers zero percent interest on balance transfers and purchases, although it is prudent to make sure you know how long these introductory rates last. Usually, creditors will only offer them for six months or so.
• Better security: Credit cards do come with some security risks, but they are much lower than other financing methods, such as a bank account. If someone is able to access your bank account, they can completely drain it. You will have to wait for the bank to conduct an investigation before the funds are replaced if they ever are. On the other hand, if someone steals your credit card, they may access some of the funds, but a quick call to the credit card company will prevent them from spending near or over your limit. The creditor will place a freeze on the card and may even reimburse you for the purchases you did not make.
• The right to dispute: If the credit card company makes an error on your bill, you have the right to dispute it. As long as you dispute the mistake in writing, you are also not responsible for paying for the purchase, unless, after an investigation, the credit card company can prove that you are responsible for it.

The Cons of Credit Cards

With the average credit card balance for Floridians being $5,623 in 2020, it is clear that many people know all too well about the disadvantages credit cards can hold. The majority of the drawbacks that come with credit cards are a result of a person’s credit limit or the total amount they can spend on their card. This credit limit gives people the illusion that they have more money than they actually do, and sometimes they have no problem spending those funds. This results in many undesirable impacts, including:

• Reduction of future income: Every time you use your credit card, you are reducing your future income. Using a credit card means spending money you do not have and so, you will have to repay that money at some point in the future. The more debt you incur, the more difficult it will become to pay off, and the more of your future income you will lose. This is particularly true if you continue to use your credit card but only pay the minimum amount due each month.
• Fees and interest: Depending on the interest rate you are charged, and how you use your credit card, it could end up costing you thousands of dollars a year. Every time you make a late payment, you will be charged a fee and they can add up pretty quickly. It is important to know your billing period, as well as how compound interest works so you can avoid these fees and interests.
• Identity theft: People can commit fraud and identity theft without ever even accessing your credit card. If they hack into the computer of the credit card company, they can obtain your personal information and use it to rack up charges although you likely will not be held liable for them.
• Lower credit scores: If you use your credit card too much and cannot pay it off, it will appear on your credit report and lower your overall credit score. This will make it more difficult to obtain credit and loans in the future, and could even impact other areas of your life, such as if you are trying to obtain employment.

Even with the most responsible use, sometimes people experience these drawbacks of credit cards. The best practice is to ensure you do not spend more than you can afford by paying off the balance in full every month.

Call Our Debt Defense Lawyer in Fort Lauderdale Today

One of the biggest drawbacks that come with credit cards is the fact that if you fail to pay them, a creditor or debt collector may file a lawsuit against you to recover the funds. When this is the case, our Fort Lauderdale debt defense lawyer at Loan Lawyers knows the strategies that can help. Call us today at (954) 523-4357 or contact us online to schedule a free consultation and to learn more about how we can help.

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Why Are Foreclosures So Common in Florida?

The past two decades, if not longer, have been very difficult for Florida homeowners. The Sunshine State was one of the hardest hit during the housing market crisis in 2008, and anyone in the state knows that it took Florida homeowners years to recover. Just as homeowners, and everyone else in the state, were starting to get back on their feet, the pandemic hit. Even with the federal and state moratoriums, people were losing their jobs at exponential rates and now that those protections have expired, the situation has become dire for some.

One cannot help but wonder why Florida homeowners seem so much more at risk for foreclosure than others. Truthfully though, this state is not the only one that sees so many foreclosures. California and Nevada also have similar conditions that make homeowners in these states more likely to face foreclosure than others. Below are just a few of the factors that make foreclosures so much more common in Florida than in many other states.

Florida’s Economy Relies on Tourism

Florida is the top travel destination in the world and the tourism industry has an economic impact of $67 billion on the state’s economy. Tens of millions of people pour into the state every year, and everyone in the state relies on the revenue this global tourism generates. Just as with any other tourism-based economy, when people stop visiting the Sunshine State, the economy starts to falter.

Many homeowners and full-time residents work in the tourism sector and when visitors stop traveling to the state, jobs are lost and people have trouble paying their bills, including their mortgage. Past trends show that when tourism in Florida slows, for any reason, the local rates of foreclosure climb.

Severe Weather Threatens Floridians’ Financial Security

Florida is no stranger to tornadoes, hurricanes, and tropical storms. Any one of these storms can devastate a home and the belongings inside and without proper insurance, homeowners are left stranded. Many families in the state live paycheck to paycheck and when a storm causes severe damage to the home, it derails the lives of the people living within it. Not only must people go to great expense to repair the home, but they may temporarily be without shelter and may even miss time from work, losing their income, too.

The majority of deductibles in property insurance policies range from five to ten percent. It is not uncommon for homeowners to try and save money on these policies by choosing the higher, and therefore cheaper, deductible without considering the consequences of doing so. If a home sustains $100,000 in repairs during a hurricane, the homeowner still has to pay $10,000, an expense that is simply out of reach for many homeowners.

Some borrowers will just stop paying their mortgage in order to pay for repairs to the home. Worse, others will simply walk away from the home, and the damage sustained, and let the home fall into foreclosure. Sometimes, the structure of businesses are also damaged during severe weather. When that is the case, a business may have to close temporarily, putting homeowners out of work for some time and making it more difficult for them to pay their mortgage.

Florida Ranks Highest for Second and Third Homes

Florida is the vacation home capital of the country. The Sunshine State has more second and third homes than any other state in the nation, according to the National Association of Home Builders (NAHB). Past trends have shown that when people fall into financial difficulty, they will make their first home their priority and will allow their second or third property to fall into delinquency. Second and third properties are also much more likely to become distressed as a result of property taxes, delinquent mortgages, code violations, and other maintenance issues.

The Pandemic Made Things Harder for Landlords and Investors

The pandemic hit hard in every state and Florida was no different. With businesses closed and shelter in place orders issued, it was nearly impossible for tenants to afford their monthly rent. This not only made things difficult for renters but for landlords and investors, too. Property owners had their own bills to pay and when state and federal moratoriums went into effect, it made things even more challenging for landlords.

To make matters worse, many people were at home much more than they would have been otherwise. They were using more utilities such as electricity and water and when these costs were included in the monthly rent, landlords were left paying these additional expenses, as well as their own. All of this at a time when many landlords were out of work themselves. It is no wonder that thousands of landlords fell behind on their own mortgage payments during the pandemic.

The Pandemic is Not Entirely to Blame

The pandemic certainly compounded the financial problems of many, but it is not entirely to blame. Economists were already reporting an increase in foreclosures nearly one year before the pandemic hit, in the summer of 2019. In the majority of cases, the increase was attributed to the same problems associated with the housing crisis of 2008. People were purchasing properties they could barely afford before the costs of HOA fees, property taxes, and insurance rates rose. Many people had already taken out a second mortgage and when those expenses increased, it was simply too much for them to bear.

Homeowners may not find these issues as challenging to overcome when it is a seller’s market and they can sell the home to recover their costs. Unfortunately, that is not the norm and most people end up selling for the amount they paid for the home, or close to it.

Our Foreclosure Defense Lawyers in Florida Can Help with Your Case

If you are facing foreclosure, you are not alone and the situation is not hopeless. At Loan Lawyers, our Florida foreclosure defense lawyers can advise on the possible defenses in your case and give you the best chance of a successful outcome. Call us today at 954-523-4357 or fill out our online form to schedule a free consultation.

 

People Also Ask:

• Why does Florida have so many foreclosures?
• Are foreclosures on the rise in Florida?
• What is the foreclosure rate in Florida?

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Avoiding Liens In Chapter 13 Cases

Avoiding liens in bankruptcy is a goal for many of our clients. Many debtors want a financial fresh start after bankruptcy, but a lien can get in the way of this.

Below, we discuss how to avoid liens in Chapter 13. If you need more information or would like to explore your own options for dealing with Chapter 13 bankruptcy liens, you can contact our bankruptcy lawyers in Fort Lauderdale at Loan Lawyers for a free consultation.

How to Avoid a Lien in Chapter 13 Bankruptcy

Florida is one of the leading states for foreclosed properties. To deal with foreclosure, many bankruptcy debtors utilize “lien stripping” to avoid second mortgages, secured lines of credit, and homeowner association liens on their real property. Once a lien is stripped or avoided, the bankruptcy debtor’s personal liability for the obligation is extinguished and the creditor loses the right to foreclose.

Title 11 (the Bankruptcy Code) treats a Chapter 13 bankruptcy filing as a personal reorganization. In a Chapter 13 bankruptcy, debtors utilize a three- to five-year plan to pay mortgage arrearages, mortgage and car payments, and outstanding tax obligations. The debtor’s disposable income, if any, is paid to unsecured creditors.

To strip or avoid a lien, a bankruptcy debtor must:

• Prove that there is absolutely not one dollar of equity in the home, i.e., the balance of their first-position mortgage loan was more than the value of the home on the day the Chapter 13 bankruptcy case was filed.
• Complete their Chapter 13 bankruptcy plan by making all payments (whether 36, 48 or 60) due under the plan.
• Receive a Chapter 13 discharge. If the Chapter 13 case is dismissed or converted to a Chapter 7 case, then the lien will not be avoided or stripped. Instead, it will be reinstated.

Note, that there are some liens that you might not be able to remove on your own, such as a tax lien. A Chapter 13 bankruptcy lawyer can review your circumstances and advise you as to the best options for avoiding liens through Chapter 13.

Contact Our Chapter 13 Bankruptcy Lawyers Today

Reduce stress and the uncertainty that accompanies trying to save your home from foreclosure. The experienced Fort Lauderdale Chapter 13 bankruptcy lawyers at Loan Lawyers are here to help you if you default on a mortgage and your financial position necessitates the consideration of a bankruptcy case filing under Chapter 7, 11, or 13. Our foreclosure defense, debt defense, and bankruptcy law firm has successfully eliminated over $100 million in debt and mortgage principal for our clients. If you require assistance with any form of loss mitigation, contact our office today by calling 954-523-HELP (4357) and see how we can help with lien avoidance and Chapter 13.

This post was originally published in June 2017 and has been updated for accuracy and comprehensiveness in September 2022.

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How to Negotiate Your Credit Card Debt in Broward County

People in Broward County are facing more financial insecurity today than in many years past and knowing how to negotiate your credit card debt is becoming more and more important. Debt settlement companies may offer to do this for you, but they charge a fee that is unaffordable for many that are already facing financial difficulty. Also, just by knowing some simple tips, it is quite easy to negotiate your credit card debt on your own.

The below tips can help you negotiate a settlement that is more manageable for you, and that will help you get out of debt faster.

Know Why Creditors are Willing to Negotiate

Before you have your first conversation with your creditor, it is important to know what motivates them to negotiate with you. Too many borrowers think the creditor is working against them, and that they will not be open to settling the debt. Fortunately, this is not true.

Credit card companies are often owned by banks, and the first priority for any company is to generate profit for the parent company and the shareholders. Once it becomes evident that you will not be able to pay your credit card balance, the priority of the company shifts slightly. Instead of focusing on recovering the entire debt, their concern is to recover as much as they can from you. The company will also become concerned with the prospect of you filing bankruptcy, which would result in them not being able to recover any of the debt.

If the company does not recover any debt from you, they must write it off, which results in the value of stocks decreasing, reduced dividend payments to shareholders, and even executives receiving fewer bonuses. To avoid these ramifications, the creditor will be willing to negotiate with you to recover at least a portion of the debt.

Understand Your Negotiation Options

Before negotiating a settlement with a creditor, it is important to know the options you have for an agreement.

When creditors are willing to negotiate with borrowers, they will likely want to enter into one of the below arrangements:

• Lump sum agreements: Just as the name implies, this type of agreement requires you to make a one-time lump sum payment for an amount that is lower than the total debt. This type of agreement only works, of course, if you can afford to pay the lump sum. Depleting your entire savings is generally not recommended to pay off debt, but a lump sum agreement may work if you just received an inheritance, a large tax refund, or a bonus at work.
• Workout agreement: A creditor may make many moves in a workout agreement, including lowering your interest rate, waiving or reducing the minimum monthly payment, or removing late fees. A workout agreement will lower the total amount of debt you owe, allowing you to pay it off in a shorter period of time.
• Hardship agreement: If you are having trouble paying your credit card bill due to a temporary situation, such as a job loss or illness, you may be eligible for a hardship agreement. This can include lowering interest rates and minimum monthly payments, but may also involve your credit card payments being suspended for a certain period of time.

Document Everything

Your negotiations with the credit card company will start when you first phone them, but it will not end there. You will likely have to speak to many different people on multiple occasions. Before making that first phone call, ensure you know the exact amount you owe, the amount of interest you are paying, and any other important details pertaining to your account.

Start the conversation by stating that you cannot afford to repay the total amount of the debt, but you want to pay something so the creditor recovers at least a portion of the debt. If you are thinking about filing bankruptcy, also mention this to them, as it will motivate them to negotiate a settlement with you.

There is a chance that the conversation will not go the way you had hoped, but it is important to note give up. As you speak to different people at the company, document everything that was said, as well as who you spoke to. If you do negotiate a deal, make sure the terms of the agreement are put into writing in the event that a dispute arises in the future.

Know the Potential Disadvantages

While negotiating a settlement for your credit card debt can help you start off with a clean slate, there are some disadvantages you should be aware of. The first is that negotiating a settlement can have a negative impact on your credit score. Even before a settlement is reached, the company may close or restrict your account and prohibit you from using credit in the future. You may also not have as much access to capital from other borrowing sources because you will be viewed as a bigger risk.

If you are given access to credit, you will also likely have to pay a much higher interest rate on the debt. This is also because you will be viewed as a higher risk. Even expenses such as your auto insurance premiums may increase.

Lastly, if the creditor forgives more than $600 in debt, the creditor will issue a Form 1099-C, Cancellation of Debt for personal tax return. According to the IRS, forgiven debt is considered taxable income. You should not take any steps to avoid filling out the 1099-C form and attaching it to your taxes. The creditor will contact the IRS and if you try to avoid paying taxes, you will face very serious consequences.

Our Debt Defense Lawyers in Broward County Can Negotiate On Your Behalf

It is possible to negotiate a debt settlement agreement on your own, but the thought is very intimidating to some people. If you are suffering from debt, our Broward County debt defense lawyers at Loan Lawyers can negotiate on your behalf to help you obtain the best agreement possible. Call us today at (954) 523-4357 or contact us online to schedule a free consultation.

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How Long Will a Foreclosure Take in Florida?

If you have missed several mortgage payments and are in fear of foreclosure, or if your lender has already sent you a default notice, you may think it is time to start packing your bags. Fortunately, even if your lender has started the foreclosure process, the situation is likely not that urgent yet.

Foreclosures do not happen automatically in Florida and there is a very specific procedure that must be followed. The procedure takes time and during that time, you may even be able to save your home. If you fear that your lender may start the foreclosure process soon, our Florida foreclosure defense lawyer outlines below how long it may take.

The Pre-Florida Foreclosure Process Timeline

Florida is a judicial foreclosure state, which means that before your lender can foreclose on your home, they must file a lawsuit against you and be successful with it. A lawsuit begins with filing a complaint with the court, and your lender will likely file that complaint within 30 to 90 days after your first missed mortgage payment.

Before the complaint is even filed with the court, your lender will likely send you a default notice 30 days after your missed payment. The default notice will notify you that you have missed a mortgage payment, and give you a chance to get caught up. If you receive a default notice, it is a warning sign that you may be headed towards foreclosure. However, lenders will rarely file a foreclosure lawsuit immediately following the default notice. They will usually wait 60 days after sending the notice before proceeding with the case.

Filing and Serving the Lawsuit

After the bank files a lawsuit and receives a case number, they will then serve you with the lawsuit. In most cases, they have to try multiple times to serve you with the lawsuit and if they still cannot reach you, they will use service by publication. This part of the process typically takes about 15 days.

Responding to the Complaint

After you have been served with the complaint, you must respond to it by either accepting or denying the allegations the lender made in their complaint. You can also file an affirmative defense. You must file your answer within 20 days of being served with the lawsuit. After the lender has heard your defenses, they will likely file a motion to strike, which they may or may not be successful with.

The Discovery Phase

Any trial will include a discovery phase, and that includes trials involving foreclosures. The discovery phase is an opportunity for both sides to request information from the other. That information can either help one party build their case, or defend against arguments made from the other side.

The discovery process may include a number of steps, such as:

• Interrogatories: These are written questions that are sent to the other side. The answers to these questions are also written and are given under oath.
• Request for production: A request for production is simply asking the other side to produce certain documents. After a request for production, the side being asked for information is required to provide it.
• Request for admissions: A request for admissions is a list of written statements that the other side is required to accept as true, or deny.

The discovery process will usually take between 45 and 90 days. When working with a Florida foreclosure defense lawyer, you may not even be aware that the discovery process is ongoing, but it is an important step.

The Final Hearing

If the lender believes they have a strong case, they may file a motion for a summary judgment. They are much more likely to be successful with this motion if you do not fight the foreclosure and do not attend the hearing. A summary judgment states that there are no facts or issues of the law that would interfere with a judgment being made. The lender must produce the note and mortgage during the hearings and if you raise any defenses, they must refute and defeat them.

If you are successful with your case at the final hearing, the foreclosure case is over and the process stops immediately. However, if the lender is successful with their case, the judge will likely enter a sale date within 35 to 120 days. The final hearing should take place anywhere between 60 and 90 days after the discovery phase.

The Impact of the Pandemic on Foreclosures

The COVID-19 pandemic has wreaked havoc on Florida, the entire country, and the rest of the globe. It has also had a significant impact on the schedules of the court. The courts are currently experiencing a great backlog, and it is estimated that it will take three years to clear that backlog. That being said, while the above timeline is a good guideline of how long a foreclosure may take, it may currently take a bit longer as the courts continue to try and clear their schedules.

The Statute of Limitations on Foreclosures in Florida

Like all civil cases, foreclosures in Florida are governed by a statute of limitations, or a time limit in which the lender must file the lawsuit. In Florida, this time limit is five years from the date of default. The statute of limitations usually runs consecutively, but certain actions may toll or extend the time limit. For example, if you file bankruptcy, it will likely toll, or suspend, the statute of limitations.

Call Our Foreclosure Defense Lawyers in Florida Today

If you have missed mortgage payments or have been served with a lawsuit from your lender, our Florida foreclosure defense lawyers can help with your case. At Loan Lawyers, we know that there are defenses available to foreclosure and we will use them effectively to give you the best chance of a favorable outcome in your case. Call us today at (954) 523-4357 or fill out our online form to schedule a free consultation and to learn more about your legal options.

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FAQs Surrounding Bankruptcy in Fort Lauderdale

If you have made the decision to file for bankruptcy, your life is already filled with questions. You are likely concerned about your future, and you are most definitely worried about how you are going to pay for your daily expenses. While dealing with all of these concerns, you also probably have many questions about the actual process of filing for bankruptcy. Most people that file for bankruptcy have not done so before and so, they have no idea what to expect.

Before you actually file bankruptcy, you need the answers to your most pressing questions. It is for this reason our bankruptcy lawyer in Fort Lauderdale has compiled a list of the most frequently asked questions surrounding the process, and the answers to them.

How Long Does Bankruptcy Take in Fort Lauderdale?

It is natural to want the bankruptcy process to be over as soon as possible. After all, once your debt is discharged you can start off with a clean slate, and you probably want that to happen sooner rather than later.

The length of your bankruptcy case will largely depend on what type of bankruptcy you file. In a Chapter 7 bankruptcy, you can have most of your debt discharged, meaning you are no longer responsible for paying it. After filing Chapter 7, your debts will likely be discharged within three to five months. If you are filing a ‘no asset’ case, your case will close at around the same time your debt is discharged. If you are filing an asset case, your debts will still be discharged within three to five months, but your case may take up to one year to close.

If you are filing a Chapter 13 bankruptcy, your bankruptcy case will take a little longer. During a Chapter 13 bankruptcy, you may have some of your debts discharged, but the majority of them will be restructured. This means they will be organized into a payment plan, which you will have to three to five years to repay. Your bankruptcy case will not close until you have followed through with that repayment plan.

What is the Biggest Bankruptcy Myth?

There are many myths surrounding the bankruptcy process but of all of these, there are two that are by far the biggest. They both surround Chapter 7 bankruptcy.

One predominant myth about Chapter 7 bankruptcy is that when a borrower is successful with their case, their debt is discharged and they do not suffer any consequences, other than perhaps paying a small filing fee. Unfortunately, this is not the case. After filing Chapter 7 bankruptcy, the bankruptcy trustee will value your assets and some of them may be sold off. The proceeds from these sales will go towards repaying as much of your debt as possible. Although state and federal law do provide some exceptions to the assets that can be seized during the bankruptcy process, you will likely still lose some assets.

Another prevailing myth about Chapter 7 bankruptcy is that everyone is eligible. Again, this is not the case. To qualify for Chapter 7 bankruptcy, you must first pass a means test. This test will consider your income and your debt to determine if you have the means to repay the amount you borrowed.

If you do not pass the means test, it does not mean you cannot still file for bankruptcy. However, you will have to file for Chapter 13 instead, which will mean that you will have to repay a significant portion of the debt back. Additionally, Chapter 13 has debt limitations, which means that if you have too much debt, you may not be eligible to file Chapter 7 bankruptcy.

What are the Benefits of Filing for Bankruptcy?

Many people turn to bankruptcy as a last resort, and bankruptcy is not often spoken about positively. However, filing for bankruptcy has many benefits. A bankruptcy will immediately stop the issues you are facing from debt collectors, including wage garnishment, debt collection lawsuits, and even potential foreclosures. After these problems are dealt with, you will feel a great sense of relief and can start evaluating your options for addressing your debt.

The second benefit of filing for bankruptcy is actually resolving your debt. The way you resolve your debt will depend on the type of bankruptcy you file, and show the debts are dealt with during the bankruptcy process. No matter what type of bankruptcy you file though, or how long the process takes, you will reap the benefit of your debt being behind you and starting over with a clean slate.

Can Bankruptcy Eliminate All of My Debt?

Perhaps one of the main questions our bankruptcy lawyers in Fort Lauderdale are asked is whether bankruptcy will eliminate all of a person’s debt. Again, a Chapter 13 bankruptcy will not totally wipe out all of your debt, although you may still be able to discharge a portion of them.

However, regardless of the type of bankruptcy you file, there are some types of debts that are considered non-dischargeable. These debts include child support, debt related to taxes, alimony, student loans, and debt obtained through fraudulent or improper means. If you have these types of debt, you likely cannot discharge it during the bankruptcy process. Still, eliminating other types of debt may help you pay off the debt you cannot discharge through bankruptcy.

Call Our Bankruptcy Lawyers in Fort Lauderdale Today

When filing for bankruptcy, you have a lot of questions. At Loan Lawyers, our Fort Lauderdale bankruptcy lawyers can answer any question you have, tell you what to expect during the process, and give you the best chance of a successful outcome. We have helped hundreds of clients through the process, and we want to help you, too. Call us today at (954) 523-4357 or fill out our online form to schedule a free consultation with one of our experienced attorneys and to learn more about how we can help with your case.

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Why is Velocity Investments, LLC Suing Me in South Florida?

If you have received a notice from Velocity Investments, LLC, you are likely very worried. You may not even know who the company is, or why they have filed a lawsuit against you. You may even think of the worst case scenario, the company securing a judgment against you to garnish your wages or levy your bank account.

Fortunately, the chances of this happening may not be as great as you think. It is common for Velocity Investments, LLC to file a lawsuit when they have no legal grounds to do so. If you have been notified of a lawsuit filed against you by Velocity Investments, LLC, our debt defense lawyers in South Florida can provide the legal defense you need.

Who is Velocity Investments, LLC?

Velocity Investments, LLC, is a buyer of junk debt in South Florida, and throughout the country. They are located in New Jersey and have been in business since 2003. On its own website, the company claims that it uses a “comprehensive collection strategy” that attempts to convert “distressed receivables to cash.” This essentially means that Velocity Investments, LLC, mainly focuses on recovering debt from old car loans, usually after repossession has taken place.

If you have received notice of a lawsuit from Velocity Investments, LLC, it is important to take it seriously. The company is legitimate, even though it may have several complaints filed against it. If you ignore the lawsuit because you think it is not legitimate, it will greatly hurt your case.

Why is Velocity Investments, LLC Suing Me?

Velocity Investments, LLC will sue you for one of two reasons. Either you actually owe the debt, and they actually own it or, and the far more likely reason, they are trying to collect a debt that you are not responsible for.

The company will hire a very experienced legal team to represent them during the case, but even though these firms have experience, it does not automatically mean the lawsuit is legitimate. These firms are highly experienced when it comes to these debt collection lawsuits and they have been around for years. It is crucial that you have a debt defense lawyer in South Florida that is just as experienced represent you.

Is Velocity Investments, LLC Violating the Law by Suing Me?

The answer to that depends on the facts of your case, but it is very common for Velocity Investments, LLC and other debt collectors like them, to try and collect on a debt that they do not own. In the case of Velocity Investments, LLC specifically, the debt will likely change many hands before it lands in the hands of the company.

For example, you purchase a car from a dealership and they offer to finance it for you. This is known as a “sale of a good” under the law. The dealership will sell that debt to another company, such as Cap One Auto or Citi. Once this second company has owned the debt for some time, they will then sell it to another company, such as Santander, one of the biggest car loan companies in the country. Santander will likely keep the debt for one or two years, and then repossess the vehicle if it is still left unpaid.

Once the repossession happens, you will still owe the remaining balance of the debt. The value of vehicles depreciates quite quickly. If you originally owed $20,000, and Santander recovered $8,000 of that value through the repossession, they will then argue that you owe the remaining $12,000. Santander will try to collect on this debt for some time but once they stop trying, they will sell it to Cascade, and then Cascade will sell it to Velocity Investments, LLC.

It is at this point that Velocity Investments, LLC will try to come after you for the debt. They will tell you that they now own the debt, but that is often not true. You have no way of knowing whether that is the truth or not, until Velocity Investments, LLC can prove they do. You would be surprised to learn how often they are unable to do that. Even more, not only does Velocity Investments, LLC have to prove that they own the debt, but they also have to be able to trace the sale of the debt back to the original car dealership.

It is Critical to Respond to the Lawsuit

There is a very good chance that Velocity Investments, LLC cannot prove they own the debt, or that you actually owe it. They are hoping that you will ignore the lawsuit. If you do, they can take the matter to court and secure a default judgment against you. At that point, they can start to garnish your wages and take other measures to collect on the debt. If you respond to the lawsuit though, you can defend it and raise the argument that you do not owe the debt, or that the company does not own it.

The Statute of Limitations May Have Passed

Another common tactic Velocity Investments, LLC often uses is to try and collect on debt when they have no legal right to do so. They often do this by filing a lawsuit against you after the statute of limitations has passed. This is the time limit for filing a debt collection lawsuit and in South Florida, that time limit is four years from the date of your last payment. If Velocity Investments, LLC does not file their lawsuit within this time, they have no legal right to try and collect on the debt.

Our Debt Defense Lawyers in South Florida Can Advise on Your Case

If you have received notification of a lawsuit filed against you by Velocity Investments, LLC, do not ignore it. At Loan Lawyers, our South Florida debt defense attorneys know how to defend against these lawsuits to help secure your financial future. Call us today at (954) 523-4357 or contact us online to schedule a free consultation and to learn more about how we can help.

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What Homeowners Should Know About Mortgage Forbearance

For many Florida homeowners, a slight change in their job or finances can turn everything upside down. Paying the bills alone can be a challenge. Add in the mortgage, and the financial strain can be overwhelming. If you’re in this position, don’t give up. A mortgage forbearance could be the answer to your problems.

Reach out to Loan Lawyers today. Our Fort Lauderdale foreclosure defense attorneys can explain how a mortgage forbearance may relieve your burdens during this challenging time. With our firm’s exclusive focus on foreclosure defense, debt defense, and bankruptcy law, Loan Lawyers can propose solutions to help you keep your home, obtain financial relief, and restore your peace of mind. Call or get in touch with us online today for a free consultation.

What Is a Mortgage Forbearance?

Mortgage forbearance is an option that enables homeowners to stop making payments on their homes temporarily. This can be a powerful tool to help you get back on track and start moving towards financial security. Depending on the situation you’re facing and the type of mortgage you hold, you may qualify for different types of forbearance terms.

If you choose to move forward with a forbearance, any payments that the lender reduces or defers under the program will be due later. But your options and rights may depend on the loan and the program you use. So, if you’re considering a mortgage forbearance, make sure to get solid advice from an experienced lawyer before making any decisions.

What Does Forbearance Mean Under the CARES Act?

Under the CARES Act, homeowners who are experience difficulties due to the COVID-19 pandemic may be eligible for a forbearance that could last up to a year. While it’s significantly easier for homeowners with a government-backed loan to obtain them, a forbearance may still be available in many situations.

But how does a mortgage forbearance work? Regardless of the type of loan you hold, an experienced forbearance lawyer can review your situation, answer your questions, and let you know if forbearance could work for you.

Is Mortgage Forbearance a Good Idea?

Whether forbearance is a good fit for you will depend on your unique needs and financial situation.

Here are some of the benefits of a forbearance:

• You can stay in your house.
• It can help you avoid late fees and foreclosure.
• While your forbearance will likely be reported to a credit bureau, it won’t be as detrimental to your credit score as a missed payment could be.

Potential cons of a forbearance include:

• You will still have to pay back the money owed once the grace period ends, which could result in higher mortgage payments.
• Unless your lender agrees not to report the forbearance to a credit agency, any future lenders will see the forbearance and may view you as a risky borrower.
• It is a temporary solution. Forbearance cannot help if you are having chronic problems making mortgage payments.

If a mortgage forbearance is not right for you, a knowledgeable lawyer can determine whether other alternatives could work given your circumstances.

Get a Foreclosure Defense Lawyer Today

Not sure about a mortgage forbearance? Get in touch with Loan Lawyers now. We believe that good people shouldn’t have to live with financial stress and anxiety. That’s why we’re here to help. We’ve saved more than 3,000 properties from foreclosure in South Florida and provided debt relief to thousands of deserving families. Let us help you, too.

Call or contact us now for a free case review. There’s no obligation.

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How to Fight a Unifund Debt Collection Lawsuit in Fort Lauderdale

Being served with a lawsuit filed against you by Unifund CCR, LLC is a frightening experience. You will likely feel overwhelmed by the legal jargon contained within the notice and summons, and may worry about how a lawsuit will affect your future.

Unifund is one of the biggest buyers of junk debts in the country, and their business model rests on the fact that the vast majority of borrowers will not respond to the lawsuit. If that is the case, they can obtain a default judgment and take legal action, even if you had a legal defense. A Fort Lauderdale debt defense lawyer can help you identify the defenses available in your case and give you the best chance of a successful outcome.

What is Unifund?

Unifund CCR, LLC, was founded in the late 1980s and is based in Cincinnati, Ohio, but they aggressively pursue borrowers in Fort Lauderdale and throughout the country. However, the company is one of the biggest buyers of debt in the country, and they often violate certain laws when trying to collect on that debt. Unifund purchases old debt from cell phone companies, hospitals and medical clinics, credit card companies, and other third party debt collection companies.

For example, if you have a Chase credit card and do not make a payment for four months, the company will write-off the debt and sell it to a debt collector, such as Midland Funding. Midland Funding will then sell that debt to Unifund CCR, LLC. By the time Unifund receives the debt, the statute of limitations has often run out, meaning the company has no right to take legal action on the debt. This is known as zombie debt but if you do not respond to the lawsuit, Unifund will still be able to successfully obtain a judgment against you.

Unifund Purchases Your Debt for Pennies on the Dollar

Like most debt collection companies, Unifund pays just pennies on the dollar for the debt they purchase. The original creditor is willing to let these large debts go for very little because they no longer have the supporting documentation necessary to legally collect on the debt. They simply provide Unifund with a spreadsheet that contains very basic information, such as your name and the amount the creditor claims you owe.

When any debt collector files a lawsuit against you, they must present significant evidence that proves the debt is yours, and that they have the right to collect on it using wage garnishment or other judgments. Creditors often lose this information and so, knowing they cannot collect on the debt, they will sell it to a third party collector that believes they can. The spreadsheet that contains your name, as well as thousands of others, is not sufficient evidence to prove Unifund can collect on the debt.

Generally speaking, debt collection companies purchase debts for approximately three percent of the total balance, so they make a profit of one dollar for every three cents recovered. Unifund also includes their attorney’s fees in their complaint against you, so they do not pay for those. David Rosenberg, CEO of Unifund, once said the company typically pays four to ten cents for junk debt, and that they recover an average of 20 cents. That equates to a profit between 150 and 200 percent, most of which is earned simply because debtors do not respond to the lawsuit.

How to Fight a Unifund Debt Collection Lawsuit in Fort Lauderdale

The vast majority of borrowers sued by Unifund do not respond to the lawsuit, hoping that ignoring the problem will make it go away. Unfortunately, this is not usually the way it works.

When filing a lawsuit against you, Unifund must prove:

• They are entitled to sue you
• You incurred the debt
• The total balance remaining that Unifund is trying to collect

If you can take action to protect yourself, it could save you thousands of dollars otherwise lost in a lawsuit. One of the simplest ways to do this is by forcing Unifund to prove the above aspects of their case. When working with an experienced consumer debt lawyer, you can file an answer that is sufficient and within the timeline outlined in the summons. Often, an answer is enough to protect you from the lawsuit and walk away from the case without paying anything.

Lawsuits involving junk debt can be resolved in several different ways. The case is dismissed by a judge, you agree to make a one-time payment that is a fraction  of the amount Unifund is demanding, or the company may voluntarily drop their case against you. If you work with a qualified lawyer, you will have a much better chance paying a smaller amount, or none at all.

Debt collectors such as Unifund also run into evidentiary issues during the case, even when they have obtained the proper documentation from the original creditor. If the company wants to introduce account balances or statements from credit cards into evidence, a custodian of records must be able to testify under oath and provide details about how the records were obtained, compiled, and processed. In most cases, Unifund will not employ such a person that can speak to the authentic nature of the documents, meaning they are then inadmissible in court.

There are many defenses to a Unifund debt collection lawsuit. The statute of limitations may have expired, or the company may not be able to prove the debt is yours, or that they have a legal right to collect on it. Regardless of the defense that may be available, it is crucial that you speak to a lawyer. Some defenses are considered affirmative and must be included in your answer.

Our Consumer Debt Lawyers in Fort Lauderdale Can Help with Your Case

If Unifund has filed a lawsuit against you, our Fort Lauderdale consumer debt attorneys at Loan Lawyers can provide the defense you need. We know the unethical tactics the company uses to collect on debt and have helped hundreds of borrowers successfully defend lawsuits. We want to help you, too. Call us today at (954) 523-4357 or fill out our online form to schedule a free consultation and to learn more about how we can help.

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How Many Mortgage Payments Can You Miss Before Foreclosure in Broward County?

A positive trend is coming out of Florida, a state known for its high rate of foreclosures and evictions. Some were worried those rates would skyrocket out of control, as protections and moratoriums enacted during the COVID-19 pandemic come to an end.

Fortunately, that does not seem to be the case. Still, economists are concerned that with the national moratorium on federally-backed mortgages expiring, all states will see an increase in foreclosure rates in the near future. The question is, how long will it take before an uptick in foreclosures is seen? How many mortgage payments can you miss before foreclosure begins?

Fewer Florida Homeowners are Behind on Their Mortgage

Florida is at the forefront of homeowners that are starting to catch up on their delinquent mortgage payments. Over the past six months, the number of homeowners delinquent in their mortgage payments dropped by one-third. Florida was outpaced by only Rhode Island and Nevada. There is less than one percentage point that separates the Sunshine State from the other two.

Currently, there are 1.45 million borrowers in the country that are 90 days or more past due on their mortgage, but are not yet facing foreclosure. That stat is startling and has many people wondering just how many mortgage payments you can miss before the foreclosure process starts in Broward County. Generally speaking, you can miss four mortgage payments before falling into foreclosure, but the exact amount depends on other factors, as well.

The Policies of Your Lender

The amount of mortgage payments you can miss before you face foreclosure will largely depend on the policies of your lender. If your lender has approved a large amount of low-risk loans, you may be able to miss more mortgage payments. Your lender may also make an allowance if you have extenuating circumstances. If you have only missed one payment, your lender is much more likely to forgive it and not take further action until you have missed two or more payments.

On the other hand, if your lender has a large amount of high-risk mortgage loans, they will likely be much more reluctant to offer any extensions. In this case, you may face foreclosure if you miss just two mortgage payments. This may occur even if you are not one of those high-risk borrowers because of the standards of the lender due to the overall default risk of the pool of mortgage loans.

The Housing Market

The general condition of your local real estate market is another determining factor in how many mortgage payments you can miss before losing your home. If there are a number of pending foreclosures in your neighborhood, there is a greater chance that you can stay in your home longer. The courts and housing authorities are often backlogged when many properties fall into foreclosure at the same time. As such, they will simply not have the time to get to your case right away. There have been instances in which homeowners were able to stay in their home after missing ten payments just for this reason.

After you have defaulted on one mortgage payment, your mortgage servicer will likely try and contact you to correct the situation. If they cannot reach you right away, they will likely try to contact you several times. If you have not paid your mortgage, your lender will usually try to contact you by the 36th day. If you have not made your mortgage payment by the 45th day, the servicer is required to contact you in writing to notify you of the options available to fix the situation.

The Timeline of a Typical Foreclosure

The timeline for any foreclosure will largely depend on the circumstances of the case, but there is a general timeline you can follow if you fear losing your home. It is as follows:

• The grace period: Most lenders will give you a 15-day grace period and if you can make the mortgage payment within this time, you will not face any further action. If you do not make your mortgage payment during this time, the case will become a bit more complex. Your lender will add late fees to the payment and may even report you to the major credit reporting bureaus, hurting your credit score.
• Default: If you miss a second mortgage payment, you are officially considered to be in default. The mortgage servicer will likely become more aggressive in trying to collect on the missed payments, and they are typically not as friendly at this point. This is often when missed mortgage payments become particularly frightening, but it is important to remember that you may still be able to contact your lender and reach an agreement. Lenders usually prefer to reach an agreement with borrowers rather than start the time-consuming and expensive foreclosure process.
• 90 day delinquency: If you are delinquent on your mortgage for 90 or more days, the situation becomes particularly serious. Your lender will likely give you up to 30 days to make the missed payments.
• Foreclosure: If you do not make the missed payments within the 30-day period offered by the lender, foreclosure proceedings will likely begin. By this time, you will have missed four full payments. However, there are defenses to foreclosure and receiving a notice does not mean you will lose your home.

Our Foreclosure Defense Lawyers in Broward County Can Help Save Your Home

The foreclosure process is not immediate for homeowners that are behind on their mortgage, but it is always a real possibility. If you fear losing your home, our Broward County foreclosure defense attorneys can help with your case. At Loan Lawyers, we have helped thousands of people remain in their home and avoid the foreclosure process, and we want to put our experience to work for you. Call us today at (954) 523-4357 or contact us online to schedule a free consultation so we can get started on your case.

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