Los Angeles Bankruptcy Lawyer Blog

Almost everyone is suffering in this economy. People are losing their homes to the banks and even to the government. Knowing the rights you have in your Los Angeles foreclosure defense case can make a huge difference in the relief you can get.

The experienced Los Angeles foreclosure attorneys at Nader Law Firm can help you decide what options are best for you.

Medeiros is a recent case coming out of Rhode Island that exemplifies the potential hazards of inaction. Medeiros et al., v. Bankers Trust Company et al., No. 2010-145-Appeal (R.I. S.Ct. Mar. 13, 2012). Medeiros purchased a home and secured a note for the purchase of the home with Bankers Trust Company (Bankers). For a couple of years Medeiros made the requisite payments but began to struggle financially. Because Medeiros was not in a good financial situation, he was unable to make payments to Bankers or to the town for the real estate taxes he owed.

The town has the ability to sell the property of any person who owes real estate taxes on that property. This is commonly referred to as a tax sale and the town is required to send notice of this tax sale to all interested parties. Interested parties include the homeowner, lenders and secured creditors. When the town sent notice to the parties in this case, the town failed to send notice of this tax sale to Bankers. Subsequently, the tax sale occurred and the property was bought by Fiduciary Trust Services (Fiduciary). Upon this sale, the town gave Fiduciary a tax deed that had been executed by the town.

Medeiros stayed in possession of the home for a year after the sale to Fiduciary. This was because the state of Rhode Island provides this period as a redemption period. A redemption period is the time after the foreclosure sale of a property where the debtor has the opportunity to pay the outstanding amount owed on the property in order to keep it. Every state has different statutes surrounding this "right of redemption." States allow for this period of time because the loss of a property is such a large loss compared with the gain obtained by the buyer. This right is retained by the debtor even in cases where the foreclosure sale was the result of owed real estate taxes.

After the time had run, Fiduciary sought to end Medeiros' right of redemption by filing a petition with the court. Medeiros received notice of the petition, and he failed to respond or file an answer with the court. Because of this inaction, the court granted Fiduciary a default judgment to terminate Medeiros rights of redemption.

This case illustrates how integral it is to answer every complaint and notice you receive. If you receive any notification of a case, lawsuit, complaint, etc., you should seek the assistance of an attorney to help you understand the best way to respond. In foreclosure, an answer provides the property owner an opportunity to assert their claims to the property involved.

But allowing the time limit to run without answering only results in you losing the rights and defenses you have.

When Medeiros later sought to have his rights of redemption re-vested, the court held that to allow this would be inequitable. The court cited relevant law that states that where a default is entered in a foreclosure case on behalf of the buyer, the debtor's rights of redemption are forever barred.

Continue reading "Medeiros v. Bankers Tells Debtors to Avoid Inaction in their Los Angeles Foreclosure Case" »

Los Angeles bankruptcy is governed by strict federal and state statute. Lenders are required to abide by specific guidelines through all of the steps of the bankruptcy proceeding.

Being faced with a bankruptcy can be overwhelming. Our experienced Los Angeles bankruptcy attorneys understand what it takes to get you the relief you are entitled to.

There are two types of foreclosure in California. There are judicial foreclosures when the lender actually sues the owner in order to have the property foreclosed on. And secondly, there are non-judicial foreclosures, which are more common in California. Non-judicial foreclosure is when lenders relinquish their rights to collect from borrowers and simply seek the proceeds from the sale of the property. Non-judicial foreclosures are favored by lenders because the process occurs quickly without the necessary costs of litigation.

Non-judicial foreclosures in California are governed by the Civil Code 2924.

Kekauoha-Alisa, et al. v. Ameriquest Mortgage Company, et al. is a recent bankruptcy case decided by the Ninth Circuit Court of Appeals. The problem in this case was that Ameriquest Mortgage Company (Lender) failed to publicly announce the foreclosure sale postponement for the property owned by Kekauoha-Alisa (Borrower).

Borrower refinanced the mortgage to her property in Hawaii, and executed a promissory note to the Lender. Because the borrower defaulted on this loan many times, the lender initiated foreclosure proceedings to begin in May of 2005. Three days before the foreclosure sale, the borrower filed for Chapter 13 bankruptcy.

Upon the filing of a Chapter 13 bankruptcy an automatic stay is placed on the sale of all of the property involved in the bankruptcy proceedings. Statute in Hawaii allows a mortgagee or the mortgagee's representative to postpone a foreclosure sale after making a public announcement. See Hawaii Revised Statute §667-5.

The lender complied with this policy and the foreclosure sale was postponed three times. On the fourth time, the lender's counsel sent a firm secretary to the scheduled auction. Because the secretary was inexperienced, she only asked people within the group if they were interested in the borrower's property. She failed to announce or post notice to the group that was present. The lenders wanted the foreclosure sale to proceed, so they asked the court for relief from the stay. This relief was granted and the borrower's home was sold.

The borrower filed a complaint with the bankruptcy court alleging that by allowing the property to be sold, the automatic stay was violated. Additionally, borrower argued that the lenders had breached the terms of the mortgage contract between the parties, and violated the requirements stipulated in the state code regarding non-judicial foreclosure. Borrower even argued that the lender was engaging in unfair and deceptive trade practices.

The bankruptcy court cited relevant law in this case. There is a public announcement requirement in state statute as well as in the mortgage contract. Also, where no notice is given to the public of a foreclosure sale postponement, the postponement is considered improper. When there is an improper postponement, the lender can be accused of engaging in unfair and deceptive trade practices.

The court in this case held that by failing to publicly announce the foreclosure sale, the lender violated Hawaii statute. Because of this violation, the court found that the lender had engaged in deceptive practices. The sale of borrower's property was voided and the case was remanded to the bankruptcy court to determine incidental damages for the borrower.

Continue reading "L.A. Foreclosure Notice & Kekauoha-Alisa v. Ameriquest Mortgage Company" »

Good news for individuals facing an Encino foreclosure or seeking an Encino mortgage loan modification: A revamped version of the Home Affordable Refinance Program (HARP) is expected to help some 7 million homeowners.

As our Encino foreclosure attorneys understand it, the modifications were announced last year, but they won't really hit stride until the middle of this month. That's when Freddie Mac and Fannie Mae will complete improvements to their automated application system.

Of course, any refinancing or loan modification action should be done in consultation with an experienced attorney, who can ensure your best interests are protected. However, we are encouraged that many more homeowners will have access to the benefits of this program, as many had been excluded under previously strict guidelines.

One aspect that's going to be extremely helpful for people who are drowning - completely underwater - on their mortgage, is the revision that allows the person to have a mortgage balance that is higher than 125 percent of the current resale value of their home. This is called the loan-to-value ration (or LTV). In the past, an individual's LTV had to be less than 125 percent in order to qualify. But that meant that millions of the hardest-hit homeowners were left out in the cold with few options.

Now, those homeowners can qualify for a mortgage loan modification at much lower interest rates - something that could save some people the heartache of losing their home or the weight of debt.

Still, there are some other stipulations that are to be considered before someone can qualify. These include:

• Loans that are guaranteed by Freddie Mac or Fannie Mae are the only ones that will be eligible. VA or FHA loans won't.
• Your mortgage has to have been bought or securitized by one of the above by the end of May 2009. Plus, it has to have an LTV higher than 80 percent.
• You have to be current on your loan payments, with no more than one late payment in the last year.

One problem that has cropped up, however, has to do with who your mortgage insurer is - something you don't have any control over. United Guaranty Corp., which holds about 10 to 15 percent of all the loans that might otherwise qualify. The reason why is technical and complicated, but it basically boils down to the fact that UGC has refused to waive its right to compel the banks to re-buy bad loans, so it's mandating more underwriting in some instances.

The bottom line is that if this is something you are thinking of doing, apply for it anyway and consult with an experienced Encino mortgage loan modification attorney who can help guide you through the process.

Continue reading "Encino Mortgage Loan Modifications Expanded With Updated HARP" »

Los Angeles foreclosures could increase with the expiration of a tax deduction that had been extended to homeowners to write off their mortgage insurance premiums.

Our Los Angeles foreclosure attorneys understand that the loss of this write-off is going to impact millions of homeowners, who had counted on it since it was enacted in 2006.

It seems nearly every time we turn around, there is some other negative impact to homeowners, many of whom are struggling in a lagging economy, working to claw their way out of debt and hang onto their homes.

The measure expired, along with nearly 60 other tax code benefits that Congress decided not to renew. These include credits for houses that meet certain standards of energy efficiency and credits for local and state sales tax payments. Each of these were part of what would have been a yearly "tax extenders" bill that would have approved the continuance of benefits for homeowners for another year or more. These measures were all pretty non-controversial, and were of at least some assistance to homeowners, so it's disappointing that it wasn't passed. The Los Angeles Times reports there is a chance that legislators could take retroactive action to pass it, but that doesn't seem likely, given the heated debates taking place on other topics.

The mortgage insurance tax deduction is going to hit hardest those with conventional loans that were low down payment - mostly those having been signed since 2007, as well as all loans approved this year where the down payment was under 20 percent. Individuals who were using rural housing and guaranteed veterans loans - whose down payments are sometimes as low as zero - are additionally going to be negatively impacted.

The deduction had allowed refinancers and buyers who used federal guarantees or private or federal insurance, and who itemized their federal tax returns, to write off their insurance premiums. Those who were married and filing jointly or single and had a yearly gross income of $100,000 or less could write off all of their yearly mortgage insurance payments. Homeowners who were married and filing separately could have up to 50 percent off of their mortgage insurance payments. And anyone who had a salary over $100,000 could get deductions that fell on a sliding scale.

Our Los Angeles foreclosure attorneys understand that for many individuals, these savings were significant. The newspaper figured that for a new couple who had an income of roughly $100,000 and a mortgage payment of roughly $200,000 could expect a savings of about $1,000 annually. That may not seem like much, but if that couple secured the loan in 2007, and one-half lost his or her job in the interim, the loss of that deduction is going to be felt, and could be yet another factor in increasing debt and the possibility of bankruptcy and foreclosure.

There are ways individuals can work to fight foreclosure and manage debt, but it's imperative that you meet with a skilled attorney, who can offer you a detailed analysis of your unique situation and the options you have before you.

Continue reading "Los Angeles Foreclosures Could Rise With Expiration of Tax Deduction" »

For the better part of a year, banks and each state's attorney general have been negotiating a settlement on behalf of homeowners who may have had their house taken through foreclosure fraud.

Many news articles have looked at how homeowners' rights were violated as banks used robo-signing practices, in which banks paid companies to authorize documents they had never seen and didn't know to be accurate, as well as made-up documentation and also shady tactics to try to unlawfully seize people's homes.

As punishment, the nation's five largest banks agreed to pay $5 billion in cash plus $17 billion over three years toward current mortgages in a large-scale settlement that all but one state agreed to. As analysts point out, however, this money is unlikely to trickle down to do any real good to the homeowners who were affected. By now, they have lost their homes, so a one-time check in a low amount isn't going to help much.

In fact, one of the best ways to defend against a foreclosure is bankruptcy in Los Angeles. When a homeowner files for bankruptcy, they get what's called an automatic stay. This allows them to get immediate protection from a bankruptcy proceeding.

Los Angeles bankruptcy lawyers know that this means a person can keep their home even if the bank is in the process of trying to foreclose. What this protection does is allows a person to drop other forms of debt so they can continue making payments on their home.

If they have decided that the home is a liability because the homeowner is underwater on their mortgage, bankruptcy in Los Angeles can help a person get out from underneath their home as part of a strategic default. In either scenario, bankruptcy can provide protection while these important decisions are made.

According to The New York Times, Bank of America, Wells Fargo, Ally Financial, JPMorgan Chase and Citibank agreed to pay $5 billion in cash. They will also attempt to help homeowners who are underwater on their mortgages by reducing principal owed by $17 billion over three years. Borrowers may qualify for $3 billion in refinancing and those who faced improper foreclosure will get $1.5 billion, which will work out to about $2,000 a person.

Many critics agree this settlement won't do much to either restore confidence in lenders or help fix the woeful housing market. While the government and banks tried to tout this as a major deal that will have big benefits to consumers, critics point to the $700 billion in underwater mortgages and compare it to the $17 billion that will go toward fixing it.

The Times article points out another issue with the settlement -- how it will be policed. Other settlements and government programs have looked good on paper, but failed to deliver results for homeowners. It's unclear how the government intends to dole out money and make sure banks are actually doing what they agreed to do.

Continue reading "Los Angeles Bankruptcy a Benefit, Even with Bank Foreclosure Settlement" »

With 2011 behind us, many people are still looking at their house as a major obstacle and a problem they don't know how to deal with.

Foreclosures are still a major problem throughout Southern California. It's a problem that is based partly on the high unemployment rate throughout Los Angeles, but also the actions of banks that have proven unlikely to work with homeowners trying to figure out a way to negotiate.

When a bank isn't willing to consider some type of mortgage modification, perhaps filing for bankruptcy in Los Angeles would get their attention. Many consumers don't realize that bankruptcy can be an effective tool in battling foreclosure.

Our Los Angeles bankruptcy lawyers recognize that considering bankruptcy is a big deal. But we would like to emphasize how beneficial these laws can be for consumers. They were designed with consumers in mind. Bankruptcy laws can help consumers discharge all the debt they have and allow them a fresh start.

For those dealing with foreclosure, bankruptcy can be a valuable tool because filing immediately stops foreclosure in its tracks. Recent articles have suggested that the time it takes for a foreclosure case to be processed can be as long as one to two years. This provides a lot of time for people to try to come to an agreement with their bank, but it also means that more notices of missed payments will be put on their credit scores.

Whether the homeowner has missed one payment or many more monthly payments, filing for bankruptcy stops the process. Banks are notified of the filing and they can no longer work toward foreclosure. The case must be moved to bankruptcy court, where lawyers, a judge and a trustee work together to solve the debt issues of the consumer.

In most cases, the homeowner can stay in the home even while the bankruptcy is ongoing. And if all goes well, it may be possible for the family to discharge other types of debts, such as credit card debt and other loans, which can free up money for them to start making payments on the house.

Stipulations can be reached with lenders in order to stop the foreclosure process and give the family time to again make payments and work to stay in their home. This could be especially helpful in Los Angeles, where in some places as few as 1 in every 100 homes is in foreclosure right now, according to foreclosure tracking website RealtyTrac.

Sadly, the problem isn't going away for many years to come. As the Los Angeles Times recently reported, major banks issued 21.1 percent more foreclosures from the second quarter of 2011, showing that they are getting more aggressive.

This isn't a time to be wondering what's going to happen with your house. Banks are attempting to get as much money as possible out of these investments and that could mean banks coming after consumers for deficiency judgments, the difference between the loan and the home's sale price at auction. This can lead to more headaches in the future for people simply trying to get by.

Continue reading "Foreclosure Numbers in Los Angeles Remain High, Though Bankruptcy Can Help" »

A recent Chapter 13 bankruptcy case in Missouri shows the value of making sure you consult with an experienced Los Angeles bankruptcy attorney before moving forward with bankruptcy.

In the case of Johnson v. Fink, a married couple attempted to change their payment plan but was shot down by the court trustee and the judge.

There are two common forms of bankruptcy in the United States that consumers choose. First is Chapter 7 bankruptcy in Los Angeles, which most people identify with. This is where debts are discharged and sometimes assets are needed to be liquidated to pay off debtors. This is mainly designed for people without income.

The second form, which has gained popularity in recent years, is Chapter 13 bankruptcy in Los Angeles. Under this chapter, people who have income but who are still badly in debt can set up a payment plan, authorized by the court, that allows them to pay back some of their debt. Once the set time period ends, the remaining debt goes away. Under this plan, their assets are protected from creditors.

The Johnson family chose Chapter 13, according to court documents and set up a payment plan based on their income from Social Security, a pension and the husband's two jobs. They agreed to pay $1,890 per month for 60 months.

But when the husband lost his second job, they asked for a modification to their plan. But what they asked for was for the payment to drop to $100 per month. The trustee -- the person appointed by the court to monitor their situation -- objected and the judge agreed.

The couple argued that based on other cases, their Social Security earnings shouldn't be counted as income for their bankruptcy payment. But based on their "bad faith" efforts in trying to reduce their payment without fully exposing all of their earnings, it was rejected. They appealed, but an appellate court upheld the lower court's decision.

The good news about Chapter 13 bankruptcy cases is that they can be flexible. If you agree to a payment plan, but have a major change in income, there are ways to petition the court to change your payment plan. Those can be granted.

But if you fudge the numbers or otherwise break the court's rules, you can not only have your petition rejected, but you can face the possibility of bankruptcy fraud charges in Los Angeles. This can lead to serious prison time, if convicted. It can also derail the bankruptcy process.

This is why hiring an experienced Los Angeles bankruptcy lawyer is so critical. Without experience on your side, these mistakes can hurt your situation. This family, which has lost income, will now be stretched even thinner because of a poor move. Avoid these mistakes and use bankruptcy laws for all they benefits they can provide. They are designed to aid consumers, not hurt them.

Continue reading "Johnson v. Fink Shows Pitfalls of an Inexperienced Los Angeles Bankruptcy Lawyer" »

The number of foreclosures in Los Angeles are returning to the high levels that Los Angeles bankruptcy lawyers witnessed last year, meaning many people are again in trouble with their banks.

Last fall, many major lending institutions put a hold on or significantly cut back on filing foreclosures after allegations of robo-signing and fabricated documentation was found in foreclosure cases. Robo-signing is when banks hired outside companies to file foreclosures and rather than get bank officials to sign documents, they process so many that unqualified personnel signed and notarized documents.

There are also allegations that banks made up documents -- paperwork that should have been filed when the foreclosure was initiated, but was instead created after the fact -- so they would have a better chance of stealing the house back from borrowers, whose rights were trampled in the process.

Many homeowners are being forced to make very difficult decisions about their living situation. With unemployment rates high, people are having to choose where and how to spend their money. Many are using credit cards as a stopgap measure to get by and the bills are piling up.

One option that may be viable is a short sale in Los Angeles. Since a large portion of homeowners are under water, meaning their mortgage is for more than the house is worth, a short sale may help. In a short sale, the homeowner finds a buyer and negotiates with the bank to ensure they won't be liable for the difference between the sale price and what's left owed on the mortgage.

Many times, though, banks won't agree to that because they can sell the house for close to the sale price at auction and still have the option of coming after a borrower for the difference, called a deficiency judgment. This can be devastating to a family that gets out from under a house that has plummeted in value.

But bankruptcy in Los Angeles may be a far better option for many homeowners. In bankruptcy, homeowners can discharge years of debt that has built up in this bad economy, which can enable them to again make mortgage payments.

And filing for bankruptcy immediately stops the foreclosure process. That means that if your house, whether it's one payment down the road toward foreclosure or set for auction, can't be taken from you. Once debt issues are resolved through bankruptcy, it's possible you can continue to live in your house after it's over.

According to the Associated Press, there were 77,733 properties that received an initial default notice in October, a 10-percent hike from September. States such as Florida, Pennsylvania and Indiana recorded the biggest increases on a state-by-state level.

The article suggests that after a year of delay in filings, banks are again going after homeowners who have missed payments rather than attempting to negotiate and help people stay in their homes. About 6 percent of homeowners have missed two or more payments, an increase from the second quarter.

The article points out that 22.5 percent of all homeowners are under water in their mortgages, which equals about 10.9 million properties. On top of that, 2.4 million additional borrowers have less than 5 percent equity in their home. Without the glut of foreclosures off the market, prices won't increase and the industry will continue performing poorly.

Continue reading "L.A. Bankruptcy Can Help Stop the Rise of Foreclosures" »

MSNBC.com reports that there are more U.S. homes entering into the foreclosure process -- a course of action that is dragging along and taking longer.

While this is bad for the economy, a longer process can help those dealing with foreclosure in Los Angeles. A longer process means more time to consider your options along with the assistance of an experienced Los Angeles bankruptcy attorney.

For those who have fallen behind on payments or who are on the cusp of financial disaster, bankruptcy will ensure you keep your home while dealing with the debt that has befallen you. Some may attempt to deal with the banks alone, hoping to score a loan modification or some alternative to the position they are in, but it rarely works.

Consulting with a good Los Angeles bankruptcy lawyer can help you make much more progress than attempting it on your own. These financial matters are complex and require the skills and experience of a lawyer who has dealt extensively with banks in the past.

They are out to make money, not friends, and they typically aren't concerned with the homeowner's financial issues. Like any business, they look at the bottom line. But bankruptcy is the one thing that terrifies them because officials know that all of the consumers' debtors will look to get a bit of money, which puts them at a disadvantage.

In some forms of bankruptcy, the banks will get nothing, while the consumer walks away without any more debt. It's certainly not that simple, but the rewards are high. If you have these financial issues, consider this option.

According to the story, as experts predicted, the number of foreclosures being filed in the United States has again begun to increase. Many analysts believed that after banks began reviewing their foreclosure processes in the fall of 2010, it would take about a year before they again began filing a high number of foreclosures.

This has come true. As MSNBC.com reports, the number of houses that received first-time default notices between July and September was 14 percent higher than from April to June.

After regulators discovered problems with robo-signing, false documentation in foreclosure cases and produced documents that didn't exist at the time the loan was signed, banks had to scale back their practices rather than move forward with incorrect documentation that violated homeowners' rights.

But now, even though there are still allegations that the practices are still ongoing, banks have again begun filing notices in an effort to take away people's homes. The time is now to consider bankruptcy in Los Angeles if you are worried about losing your home. Bankruptcy can protect you.

Rather than float around the problem, address it head on. Don't allow the banks to take your home without a fight. Consult with an experienced lawyer who can help you sort out your financial issues by using the laws for your benefit.

Continue reading "Banks Ramping Up Foreclosures, Which Stop With Bankruptcy in Los Angeles" »

In what has become a disturbing trend, banks are increasingly going after homeowners for "deficiency judgments," court orders that allow them to collect the difference between what is owed on a foreclosed house and what the bank sold it for at auction, The Wall Street Journal reports.

Many Americans have dealt with the stinging feeling of not being able to afford their home and having a bank take it away. That has sent families to live in with relatives or move on to apartment complexes or other housing.

But what is even worse is if the bank then comes back months or years later with a deficiency judgment, which says a judge has signed an order telling the one-time homeowner he or she must pay tens or hundreds of thousands of dollars to make up the difference between the note and the foreclosure price. This can be devastating.

But a way to fight back is considering bankruptcy in Los Angeles. Whether a house has already been through foreclosure and banks are seeking these judgments or if a person is on the cusp of foreclosure, bankruptcy can help.

Los Angeles bankruptcy lawyers can help whether you are on the brink of missing a monthly payment or if you are months behind. Filing for bankruptcy immediately protects your home from creditors. The process is designed to work out all debt problems, regardless of how big they are.

Creditors can't take your home once you file for bankruptcy and they aren't allowed to contact you, either. The consumer has built-in protections once they file and one of them is your home.

The article follows the problems dealt with by one man whose vacation home in Florida went through foreclosure after he couldn't afford it because of unemployment. Then, a year later, he got a phone call saying that a judge signed off on a deficiency judgment of $193,000. His house had gotten only a quarter of what was owed and his bank sued him for the rest.

There are 41 states where banks can go after owners in deficiency judgments and all have different rules. Experts believe that banks pick and choose who to go after based on suspicions that they could make payments but don't because of a drop off in home value. That's called "strategic default."

What analysts agree on is that given the economic difficulties of banks saddled with millions of foreclosures, lenders will continue this practice. Lawyers say they have seen a steep increase in deficiency judgments in recent years as banks attempt to recoup the money that has evaded them in recent years.

There are more than 3 million properties on the market in the United States and that number doubles when you factor in properties that are either in or close to foreclosure. There are years of inventory and the real estate market is bleak, so banks will do what they can to make money.

This means even going after the downtrodden and those who have already lost their homes. Then banks want to take all of their money. But bankruptcy will scare away banks taking this approach. Based on a lack of income or other expenses that preclude paying the judgment, bankruptcy can get that debt wiped off a person's plate forever.

Continue reading "Deficiency Judgments in Los Angeles Foreclosures Can Be Avoided With Bankruptcy" »

Many people think there aren't many ways to put up a defense to a foreclosure that a bank is pursuing.

For one, if the bank can't show who actually owns the note on the house -- through years of sales to investors -- or if illegal paperwork has been filed, there may be a chance a homeowner could get out of foreclosure.

But there is an easier and more likely option of Los Angeles bankruptcy to consider. Many people struggling with foreclosure don't realize that bankruptcy stops the process immediately.

Whether a homeowner is only one month behind in payments or the houses is about to be sold at auction, a Los Angeles bankruptcy lawyer can help homeowners stop the foreclosure in its tracks. That means no more calls by creditors and no more wage garnishments.

As MSNBC.com reports, the number of foreclosures are increasing. Banks are again making a big push toward filing foreclosures after they spent more than a year reviewing their faulty procedures.

RealtyTrac, a foreclosure tracking service, reports that first-time default notices increased 14 percent from July to September compared to the April to June period before it. This shows that banks are now moving more aggressively against homeowners who have fallen behind on payments.

Experts believe that the faster homes are taken away from borrowers and put on the market and re-sold, the sooner the real estate market can recover. But these experts are highly paid and aren't living in the trenches like the rest of the country. They don't realize that it's pretty difficult to move an entire family when they have fallen behind on one payment.

Banks care about making money, giving little regard to homeowners who want to try to work something out that is beneficial to both parties. But sometimes, negotiations don't mean much. When jobs are lost or major medical illnesses result in big bills, bankruptcy may be the only way to get back on track.

By wiping out other debts, such as credit card bills, loans or other expenses, sometimes families can restructure their monthly payments to again afford a house they wish to stay in for a long time. This can be beneficial to both the homeowner and the bank holding the note.

Some people think there are no answers when they are saddled with debt. They have no credit, so they can't get a loan. Their family members, too, are jobless and unable to provide any money and they aren't likely to get a raise if they are lucky enough to have work right now.

So, they continue paying the minimum on credit card bills or medical bills in the hopes that the economy will miraculously turn around. But the reality is this country is in tough financial shape and it's going to take a long time for things to turn around.

Waiting may not be the best action -- it may be moving forward aggressively with bankruptcy in order to give your family a chance for a brighter future, not one held down by bills and debt.

Continue reading "Los Angeles Bankruptcy Stops Foreclosure In Tough Economy" »

CNNMoney recently reported that a faster foreclosure process is the only way to help the downtrodden real estate market recover.

But Los Angeles Bankruptcy Lawyers would argue that a faster-moving foreclosure process would trample the rights of homeowners as banks have already tried to unlawfully take away people's houses with robo-signed documents and other shady dealings.

There are many options to stopping a foreclosure in Los Angeles. Chief among them is filing for bankruptcy. Filing stops foreclosures immediately and allows for the homeowner to focus their efforts on getting outstanding debts eliminated. Loan modifications, refinancing and short sales are also options, but require bank agreement and participation, which can sometimes be difficult.

According to the news article, The Obama administration's programs to help save the housing market simply haven't worked and the market is getting worse. Experts believe that as the foreclosure process drags out, the economy will be slower to recover. By getting people out of their houses and selling them, the inventory will shrink.

Of those behind on mortgage payments, only 6 percent had hit the two year mark in July 2009. This summer, more than one-third of those behind on payments were two or more years behind. A majority of homeowners -- 71 percent -- are at least 12 months behind on payments. Two years ago, 41 percent were in that position.

But a big part of that change in statistics is because of the aforementioned bank problems. Lending institutions have used mortgage servicers and other companies to quickly process foreclosures since 2007, when the housing market began crumbling and people started missing mortgage payments in droves.

These companies signed off on documents that were supposed to be checked by bank officials who had knowledge of the case, but were instead signed by people who had no knowledge of the specific case or qualifications to sign the documents. Banks were also accused of filing inaccurate paperwork.

Among these scandals -- and the impending attorneys general investigations into their practices -- banks have pulled back and cut back on filing foreclosures while they reassess the process. So, many foreclosures haven't been filed for nearly a year because of the problems, which has contributed to the number of people so far behind on their payments.

Industry leaders don't have any solutions, but they believe that government-run programs have missed the mark on helping people. They also believe that more programs will simply keep the country in its current rut with less opportunity to get out.

It's probably true that these foreclosure-themed programs won't really work because they typically have such restrictions on who qualifies and they don't do a lot for those who do qualify. Look at the funds that were put aside so banks could re-negotiate loans and help homeowners -- very few have used the money to help homeowners stay in their houses.

Bankruptcy, for those who qualify, is the only true way to stop foreclosure. The process stops the process immediately and allows consumers to discharge debt and get back on track financially. The process can also keep a person in their house during and after the process is complete.

Continue reading "Experts: Slow Foreclosure Process Bad, Yet L.A. Bankruptcy Can Stop Foreclosure In Its Tracks" »

More bad news out of the housing market in Los Angeles and nationwide: sales of existing homes fell in July as lenders have been strict about lending and property values have been slow to rise, CNNMoney reports.

The news just isn't getting better, is it? Foreclosure in Los Angeles has reached epic proportions, while houses are slow to sell and prices are slow to rise, even in California, where there is a huge concentration of multi-million dollar mansions. While it sounds bad, there is hope for a person facing foreclosure in Los Angeles. Bankruptcy in Los Angeles is an option that immediately stops foreclosure, regardless of what stage of the proceeding it is in.

Whether a person has missed one payment or is several months behind in paying their mortgage, filing bankruptcy keeps them in their house while the process works itself out. Consulting with an experienced Los Angeles Bankruptcy Attorney should be the first step someone with debt problems considers.

In July, sales of previously owned homes dropped 3.5 percent, good for an annual rate of 4.67 million. That's down from 4.84 in June, a report from the National Association of Realtors says. Experts predicted a rate of 4.87 million homes sold.

The median home price sits at $174,000, which is down nearly 5 percent from this time last year. Sales are actually up 21 percent from July 2010, but economists had predicted a more successful month.

Some believe that because lenders are tightening their standards on home loans, many people are unable to get the financing they need to buy a home, even with prices at record lows. That is preventing the market from recovering as quickly as some had hoped.

By the end of July, there were 3.65 million homes on the market. Because of the slow month, it will take 9.4 months for all those homes to be sold, which is up from a predicted 9.2 months in June.

Many experts attribute the problems with home sales to the glut of foreclosures on the market. With millions of homes sitting in limbo as banks work out problems with "robo-signing" and other questionable legal practices, homes are affected. Property values have dropped and with such a large inventory of houses available, sales are tough right now.

The foreclosure process can be very stressful for families who have lost jobs, suffered medical issues or who have been hit by high interest rates on credit cards and loans due to predatory lending practices.

For these people, bankruptcy can help. If people have fallen behind on payments or missed payments, their credit scores have taken a hit. If they have problems obtaining credit and don't know where to turn, bankruptcy in Los Angeles can allow them to get rid of all the debt they have amassed and still stay in their houses. The purpose of bankruptcy is to give consumers essentially a "fresh start," where they can work on improving their credit and forming a plan to better deal with finances in the future. Creditors and harassing lenders will leave them alone and they can move on with life.

Continue reading "Home Sales Drop, But Los Angeles Bankruptcy Stops Foreclosure" »

Now that lawmakers in Washington D.C. have figured out, temporarily at least, how to keep our country from going into default, it's a good time to figure out how we, individually can do the same.

Obviously, every average American can't just vote to raise their own debt ceilings by a few trillion dollars, but there are steps that can be taken to improve a person's debt situation. For some, though, the situation is beyond repair. Bankruptcy in Los Angeles can be a good option for those struggling with consumer debt and looking for answers. Consulting with an experienced Long Beach Bankruptcy Lawyer should be your first step to investing in your financial future.

Forbes recently came out with four tips to help people to deal with their own debt ceilings:

See if you can refinance debt with a lower interest rate: This can be tough, but it may be possible to transfer high interest rate balances to credit cards with low or even zero interest rates for at least a period of time. But there are pitfalls -- transfer fees and high rates after introductory rates expire.

Another possible option is borrowing from home equity and your retirement plan. While home equity loans tend to be tax-deductible, they require good credit and some equity. Retirement plan loans don't require a credit check and the interest goes back into your own account, but your money won't be growing for your retirement and you may owe taxes, plus a possible penalty.

Find out where you're spending and try cutting back: Many people believe that a $100 per month cable bill is a necessity, but that's $1,200 a year that could be applied elsewhere. The $80 a week you spend on eating out adds up to more than $4,000 a year -- another big savings.

Look at three months of bank and credit card statements and keep track of spending. If there's not enough fat to cut, consider prioritizing spending on food, utilities, housing and transportation. While not ideal, it's better to miss a credit card payment than possible lose your house or vehicle to foreclosure and eviction. Be careful though, missed payments will hurt your credit and can trigger high default interest rates.

Start paying down debt: If you can free up some savings through that plan, begin paying off a balance on the highest interest rate loan, if possible. If you're having trouble making the minimum payments, it may be possible to work out an affordable payment plan with creditors, though they are rarely interested in talking.

Stick to your own "balanced budget amendment": Most people consider student loans and home loans good debt because the assets are likely to appreciate in value or increase earnings potential. With home loans, that may be more accurate today than it was three years ago, as prices have fallen dramatically in many parts of the country. Consider reserving borrowed money for things that will appreciate or that help you bring in money -- like a car for driving to work.

Review every expense that happens every month and take non-monthly expenses like vacations and holiday shopping and break them into monthly amounts. Try to use a fixed cash amount for spending and work to save three to six months of expenses in an emergency fund.

These are all good tips and in order to have a healthy financial future, bankruptcy may be the best option. Consult with an attorney today who can assess your situation and determine whether or not these plans are the best way to get you stable financially.

Continue reading "Tips To Deal With Your Debt Ceiling in Los Angeles" »

A recent article on MarketWatch.com suggests that foreclosure activity dropped during the first half of the year compared to 2010 in most major U.S. cities.

While could be good news, most experts believe this is simply the calm before the next storm of foreclosure filings. Because of robo-signing problems and inaccurately filed paperwork in foreclosure filings, lenders and banks have filed fewer foreclosures in the last several months, going back to fall 2010. What people who are struggling to make monthly payments should note is that there are several foreclosure defense options in Los Angeles that should be explored. Consulting with an experienced Los Angeles foreclosure Attorney to discuss all options is imperative.

While activity dropped in most major cities, filings spiked 10 percent in Seattle, according to foreclosure tracking company RealtyTrac. Of the 20 most populated U.S. metropolitan areas, it was the only to post an increase in foreclosures.

While Seattle posted a 10 percent increase, the foreclosure rate fell 74 percent in Baltimore. Foreclosure activity dropped in 178 of 211 cities with populations of 200,000 or more, according to RealtyTrac. According to the company, seven of the top 10 cities for foreclosure rates are in California:

1. Las Vegas-Paradise, NV


2. Phoenix-Mesa-Scottsdale, Ariz.


3. Modesto, CA


4. Stockton, CA


5. Riverside-San Bernardino-Ontario, CA


6. Vallejo-Fairfield, CA


7. Reno-Sparks, NV


8. Bakersfield, CA


9. Merced, CA


10. Sacramento-Arden-Arcade-Roseville, CA

There are 10 California metropolitan areas in the top 20 cities for foreclosure rates, which shows that many Californians are hurting financially. For many, job loss has made paying for a house almost impossible. For others, unexpected medical bills have sent them into debt.

There are many options to avoid foreclosure and if that's not possible there are ways to take control of the situation to lessen the impact it has on your future. Consulting with a Los Angeles Bankruptcy Attorney is crucial, however. Handling these matters alone can lead to more financial trouble, while having someone with experience by your side is important.

Sometimes, lenders and banks will consider a loan modification in order to help the borrower, but many times they won't even consider it. Banks can be ruthless and sometimes won't even consider a short sale, which allows the borrower to avoid foreclosure.

Filing for bankruptcy is the only sure way to stop a foreclosure. Filing for bankruptcy in Los Angeles immediately stops foreclosure and sends out notice to creditors banning them from contacting the consumer. The process can take months to complete, but it leaves the consumer with a refreshing chance to get back on their feet financially.

These issues are complex and require a professional who can help you determine which options are the best and how best to proceed. Don't attempt to do it on your own. Banks are in it for themselves, not to help the homeowner. Trust experience.

Continue reading "Los Angeles Bankruptcy Stops Foreclosure Immediately" »