Loan Lawyers: November 2022

Monday, 28 November 2022

Difference Between Debt Consolidation and Debt Settlement

Loan Lawyers, LLC is licensed to practice law in Florida. If you have a legal matter that you would like to discuss and you are NOT located in Florida, please get in touch with your state’s Bar Association to get the information of a lawyer that can assist you in your home state. Thank you.

If you are struggling to pay off debt, you may have heard about debt consolidation and debt settlement — two financial strategies to manage your debt. While these methods may sound similar, they function differently and are often used to resolve specific issues.

Contact Loan Lawyers for a free consultation with a debt defense lawyer to learn more about debt consolidation vs. debt settlement.

What Is the Difference Between Debt Consolidation and Debt Settlement?

There are a few key differences between these two methods of debt management. First, debt consolidation combines debts from multiple creditors into a single debt that may have a better interest rate and more manageable terms for the debtor. Debt can be consolidated through a balance-transfer credit card, personal loan, home equity loan, or debt consolidation loan. This method may offer advantageous terms, such as a lower interest rate that allows the debtor to save money. It can also help the debtor pay off debt sooner and reduce the payments they must make.

Debt settlement involves purposefully withholding payment from a creditor for a period, typically two or three years. The debtor then attempts to settle the debt with a much lower lump-sum amount. They may try to negotiate debt resettlement or hire a for-profit company to help. However, it can be risky in either case.

Pros and Cons of Debt Consolidation vs. Debt Settlement

There are advantages and disadvantages to each debt management strategy. The pros of debt consolidation are:

Fewer payments to manage
Lower monthly payments due to a lower interest rate or extended payment schedule
Credit may improve if the credit utilization ratio is reduced

The cons of debt consolidation include the following:

Original debt is not eliminated but extended over time
Bad credit may prevent a debtor from getting a lower interest rate
There may be fees involved
The pros of debt settlement are:
Opportunity to settle for a much lower amount, saving significant money
Possibility to settle relatively quickly

However, there are cons of debt settlement, such as:

No guarantee that a creditor will agree to settle
Accrual of late fees and interest charges while payments are being withheld
Potential damage to a debtor’s credit score
Possibility of being scammed by debt settlement companies

Debt Consolidation vs. Debt Settlement: Which Is Better for You?

You should consider several factors when determining which financial strategy is better for you. The main issues to take into account include the following:

How much debt do you owe
Whether you are delinquent and, if so, how far behind you are
Your credit score
Your ideal timeline for paying down debt

An experienced debt relief attorney can evaluate your financial situation, explain your options, and help you choose the best strategy for your case.

Contact Loan Lawyers Today for a Free Consultation

If you struggle to manage your debt, contact Loan Lawyers today for a free consultation. Our foreclosure defense, debt defense, and bankruptcy law firm can help you find the best solution for your case. We work directly with each client on a personalized, detailed approach to solving debt problems.

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Tuesday, 15 November 2022

HOA Foreclosure vs. Bank Foreclosure

Loan Lawyers, LLC is licensed to practice law in the state of Florida. If you have a legal matter that you would like to discuss and you are NOT located in Florida, please contact your state’s Bar Association to get the information of a lawyer that can assist you in your home state. Thank you.

The word “foreclosure” understandably triggers fear and anxiety in most homeowners. As a homeowner, you should understand how one initiated by a homeowner association (HOA) differs from traditional bank foreclosure.

The team at Loan Lawyers wants to provide homeowners facing foreclosure with practical and straightforward information about the process of homeowner association foreclosures. To learn more, contact Loan Lawyers today for a free consultation.

Why Do HOA and Bank Foreclosures Happen?

Foreclosure occurs when a lender takes back property from a borrower who can no longer make mortgage payments. When someone cannot afford to pay their mortgage, the lender is not getting back the money on the loan they provided. If the lender can foreclose on the property, it can take ownership of the house and sell it to recover money.

Under federal law, a homeowner must generally be more than 120 days past due on their mortgage payments before a lender can file for foreclosure. However, the homeowner’s HOA can begin foreclosure if they stop paying HOA fees.

What Are the Main Differences Between an HOA Foreclosure and Bank Foreclosure?

There are distinct differences between an HOA foreclosure and a bank foreclosure. A bank foreclosure typically occurs when a homeowner fails to make monthly mortgage payments. After 120 days, a lender may begin foreclosure to take ownership of the property and sell it to recover losses.

HOA foreclosures are different because they involve a homeowner association. An HOA collects dues or fees from homeowners to maintain communal areas like parks, lawns, and pools. If a homeowner fails to pay these fees, an HOA can choose to recover what it is owed by placing a lien on the home. A lien prevents the homeowner from selling or refinancing the property.

The HOA can take steps to begin the foreclosure process. However, HOA auctions only seek to sell the property for enough money to recover the outstanding lien. An HOA foreclosure has nothing to do with a homeowner’s mortgage. When someone buys an HOA foreclosure, they may be surprised to find an outstanding mortgage is still attached to the property.

What Should I Do After Being Served with a Foreclosure Lawsuit?

If you have been served with a foreclosure lawsuit, you should immediately contact an experienced attorney who can advise you on your options. A foreclosure defense lawyer can find a solution that works for you and your lender or HOA. Navigating the foreclosure process alone rarely works out in a homeowner’s favor, so hiring an attorney is in your best interest.

Contact the Consumer Debt Defense Attorneys at Loan Lawyers for Help

Loan Lawyers is a foreclosure defense, debt defense, and bankruptcy law firm committed to protecting clients’ rights. If you are being foreclosed on, contact the consumer debt defense attorneys at Loan Lawyers today for a free consultation.

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Thursday, 10 November 2022

Legal Rights Before a Foreclosure

If you are facing foreclosure in Florida, you might be feeling overwhelmed and wondering what to do next. The Florida foreclosure attorneys at Loan Lawyers can help you understand your options and establish a strong legal strategy to defend your mortgage rights and home. To learn more about your homeowner rights in foreclosure, contact Loan Lawyers today for a free consultation.

Breach Letter

During the pre-foreclosure stage in Florida, your lender must send you a notice known as a breach letter. This notice is meant to inform you that you are past due on your mortgage payments and the lender will begin foreclosure if you don’t correct the default. Breach letters should also contain information about your various options for avoiding foreclosure.

Notice of the Foreclosure

Homeowners in Florida are also entitled to notice of a pending foreclosure if they cannot correct the default. Florida is a judicial foreclosure state, which means lenders must get court approval before beginning foreclosure proceedings. If your lender gets approval from the court for judicial foreclosure, your notice should come in the form of an official complaint and court summons in the mail.

After your lender starts a judicial foreclosure in Florida, you have 20 days to file a response in court. If you do not respond by the deadline, your lender might ask the court to grant a default judgment. A default judgment would allow your lender to proceed with the foreclosure of your home.

Reinstating Your Mortgage

Most Florida home mortgages have conditions allowing borrowers to reinstate their mortgages. This lets borrowers stop the foreclosure by paying off all past-due amounts and fees. Many mortgage contracts allow borrowers to reinstate their mortgages until a specific deadline, usually when the court renders a judgment.

After a successful reinstatement, the lender stops foreclosure proceedings. The borrower then resumes their regular mortgage payments.

Redeeming Your Home

Another way to save your home from foreclosure is by redeeming the property, which is different from reinstating a mortgage. When you redeem a home, you must pay off the entire mortgage and any late fees or interest you owe your lender.

As you might imagine, few homeowners who default on their mortgages have the financial ability to pay off their debts all at once. If redeeming your home is an option, remember that you must redeem the home before your court-ordered foreclosure redemption period expires or your lender files a certificate of sale.

Contact the Foreclosure Defense Attorneys at Loan Lawyers

You shouldn’t have to defend your homeowner rights on your own. If you want to challenge your foreclosure, contact the foreclosure defense team at Loan Lawyers today. We can address your concerns and review your case for free when you contact us for an initial consultation session.

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Tuesday, 1 November 2022

What Is Zombie Debt and How Do You Deal With It?

One of the most stressful things about being in debt is how long it can impact your life. Sometimes, a debt may be so old that your creditors can no longer collect on it. That does not mean unethical collectors won’t try to collect on this debt, though, putting you in a difficult situation.

The rise of this “zombie debt” is a growing problem in Florida. But the foreclosure defense, debt defense, and bankruptcy attorneys at Loan Lawyers can help if someone is trying to collect on these debts. Contact our office for a free consultation to learn more.

What Is a Zombie Debt?

“Zombie debt” is a term for debt that is old or you no longer owe. These debts may have been previously discharged in bankruptcy or are so old that your creditors can no longer take action against you. However, people sometimes buy these debts and try to collect on them, using scare tactics or intimidation to force debtors to pay up when they no longer owe anything.

There are a few common types of zombie debts that debt scavengers will try to collect on, such as:

Expired debts – When you owe money to your creditors, they have a limited window to take legal action if you fail to pay back the debt. If the statute of limitations on a zombie debt has expired, you no longer have to pay them back.
Debts discharged in bankruptcy – The point of bankruptcy is to clear away your debts and give you a fresh financial start. You do not have to pay debts discharged in bankruptcy.
Debts that were not yours – Even in this age of electronic records and databases, it is possible for your debts to be confused with someone else’s. You do not have to pay a debt you do not owe.
Debts that have fallen off your credit report – If a debt has been dropped from your credit report, you may still have to pay it. However, it should not impact your credit score. Unfortunately, debt scavengers sometimes report old debts as new so they reappear on your credit report, which can have severe financial consequences.

How to Deal With a Zombie Debt

Do not agree to pay any debt you believe you do not owe. In fact, you should say as little as possible if someone contacts you about a zombie debt. You do not want to give the debt collector any information to use against you or potentially revive the debt.

You should do some research before you take any action. The Fair Debt Collection Practices Act and other laws provide certain legal protections for borrowers. You can also ask the debt collector to validate the debt you allegedly owe.

No matter what, talk to a lawyer right away. A debt defense attorney can review your situation, tell you if you have to pay the zombie debt, and help you deal with debt scavengers.

How to Remove Zombie Debt from Your Credit Report

There are ways you can have a zombie debt removed from your credit report. You may have to contact the credit bureau directly, and each of the three main credit bureaus has procedures for these situations. The best and easiest way to remove zombie debts from your credit report is to work with an experienced debt defense lawyer.

Talk to Our Experienced Debt Defense Attorneys in Fort Lauderdale, FL Today

Is someone trying to collect on your old or expired zombie debt? Our Fort Lauderdale debt defense lawyers have more than 100 years of combined legal experience and have helped our clients eliminate more than $100 million in debts. To learn more about how to deal with zombie debt, contact us today for a free consultation.

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4 Tips for Starting Over After Bankruptcy

Filing for bankruptcy can provide you with a fresh financial start. But recovering after bankruptcy isn’t always easy. Knowing how to start over after bankruptcy can help you build a solid financial future. Contact Loan Lawyers today to learn more about what to do after bankruptcy to take charge of your finances.

1. Save Your Paperwork

Although you may want to put your bankruptcy behind you as quickly as possible, saving any paperwork from your bankruptcy case is essential. You may be asked for copies of your bankruptcy notices or files — especially when applying for large ticket items such as a car loan or mortgage after bankruptcy.

Your bankruptcy paperwork will also be handy if a creditor or collection agency approaches you about money owed. If your bankruptcy included that specific debt, you could easily prove that your bankruptcy was discharged and you no longer owe that money.

2. Create a Budget

Knowing how to manage your money is critical to helping you establish good financial habits with your day-to-day spending. One way to do this? Create a budget.

However, creating and sticking to a budget may sound challenging. To set yourself up for budgeting success, you must have a plan. First, understand where you stand now. Take an inventory of your income, savings, spending, and debt. Then, create a financial plan for life after bankruptcy.

For example, you may choose to use the 50/30/20 method of budgeting. This budget assigns 50 percent of your income to needs, 30 percent to wants, and 20 percent to savings. After budgeting, you may find you need to cut back on spending or get a side hustle or part-time job to bring in more income.

3. Save Money for Emergencies

Building an emergency fund is another way to create healthy financial habits after bankruptcy. When unexpected expenses pop up, emergency savings can help you avoid landing back in debt.

Even with the necessity of an emergency fund, 56 percent of Americans don’t have enough savings to cover a $1,000 emergency expense – causing stress and increasing debt. Don’t put off saving money for emergencies. Even if you only have a small amount to fund an emergency savings account, saving is key to helping your fund increase over time.

4. Check Your Credit Report

When you filed for bankruptcy, you probably saw your credit score dive. Your credit score increases as old credit accounts drop off your credit over the next seven or ten years, depending on if you filed Chapter 7 or Chapter 13.

However, make sure your credit reports note which accounts are included in your bankruptcy. You don’t want an overdue credit account floating around, causing more financial havoc. Check your credit report regularly to help track your credit accounts and reduce reporting errors.

Things to Avoid After Filing Bankruptcy

Part of knowing how to recover after bankruptcy is understanding what not to do. Some things to avoid when recovering from bankruptcy include:

Avoid credit repair scams
Avoid payday lenders
Avoid taking on additional debt
Avoid repeating past financial mistakes

Taking proactive steps to repair credit and improve your financial situation can help you pave the way for a more solid financial future.

Talk to Our Experienced Bankruptcy Lawyers in Fort Lauderdale, FL Today

If you’re considering filing for bankruptcy, you’ll want an experienced debt solution law firm with a proven track record of success on your side. To gain control of your debt, don’t hesitate to call the experienced bankruptcy attorneys at Loan Lawyers to discuss your options and how we could help.

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