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Month: August 2018
What to do when facing foreclosure

On Behalf of O’Brien Law Firm, LLC

Posted on: August 28, 2018

When Mississippi homeowners fail to make mortgage payments, they could face foreclosure. This means that the lender has decided to take possession of the home. However, there are ways that a person can end or delay the process. The first step in the process is to read any letters that the lender sends as they may offer information about avoiding a foreclosure.

Ideally, a homeowner facing foreclosure will talk to the lender as soon as possible. In many cases, the lender would rather work out an alternate payment plan as opposed to actually going through with a foreclosure. It may be possible to have the loan refinanced or have late payments rolled back into the loan. Depending on a person’s financial situation, it may be worth looking into bankruptcy to stop or delay the foreclosure process.

However, those who file for bankruptcy should be aware that it could significantly reduce their credit scores. The benefit to doing so is that a debtor will obtain an automatic stay against creditor collection actions. This means that the lender cannot follow through with a foreclosure while the bankruptcy case is open. If that isn’t an ideal option for a homeowner, a short sale may be a viable alternative to avoid the negative consequences of a foreclosure.

By filing for bankruptcy, an individual could receive a fresh financial start. He or she may also be able to postpone a foreclosure or the repossession of other property. In some cases, it might be possible to have debts fully discharged in a bankruptcy case. Those who own a home may be able to use an automatic stay as leverage to negotiate new loan terms with their lenders.

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Things to consider before filing for personal bankruptcy

On Behalf of O’Brien Law Firm, LLC

Posted on: August 20, 2018

While bankruptcy cases have been decreasing in Mississippi and across the U.S. since the end of the Great Recession, many consumers still need to file for bankruptcy protections each year. However, experts say that people need to understand a few key points before deciding to file for personal bankruptcy.

First, in order to get maximum debt relief, consumers need to make sure they declare all their debts in their bankruptcy filing. This means that they need to carefully review their financial situation and make sure they understand what types of debt they owe and who they owe it to. Second, consumers need to realize that bankruptcy filings are long, complicated and easy to mess up. For example, many people fail to provide all the necessary documents, such as bankruptcy schedules, or fail to complete federal requirements, such as attending debtor education classes. Unfortunately, these types of mistakes can significantly delay a case.

Speaking of delays, experts say that, in most cases, consumers shouldn’t postpone filing for personal bankruptcy. Filing can eliminate certain monthly debt payments, which could provide extra funds for essentials, including food and gas. A bankruptcy filing also puts an end to debt collection efforts and harassing phone calls, which can reduce anxiety and stress. Finally, consumers should realize that bankruptcy is permanent. This means that, while it may only stay on their credit report for seven to 10 years, it will remain on their record for the rest of their lives. As a result, it could prevent them from getting certain jobs or loans.

Individuals considering bankruptcy could learn more about their legal options by contacting an attorney. An attorney could review a client’s case and recommend the best way to obtain financial relief.

Source: Born2Invest, “Personal bankruptcy: 4 things to know before filing one,” Christopher Elliott, Aug. 10, 2018

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Bankruptcies among elderly population rising rapidly

On Behalf of O’Brien Law Firm, LLC

Posted on: August 13, 2018

Researchers have identified a startling new trend in bankruptcy filings. They have gone up significantly for elderly people in Mississippi and nationwide. Since 1991, the number of filings from people over the age of 65 went up by 480 percent by 2016. When looking at the filings from people over 75, the increase during that period approached 1,000 percent.

Insufficient income and medical expenses represent the primary forces overwhelming older people and retirees. Drawing upon survey data collected by the Consumer Bankruptcy Project, researchers found that almost 70 percent of elderly bankruptcy filers cited job loss, income decline or inadequate retirement savings as the cause of their financial troubles. Medical bills or problems interfering with work came in a close second with 62 percent of people responding that health care issues motivated their filings. Some people experienced a financial hardship because of changing eligibility for Social Security and the shift away from pensions to 401(k) savings plans.

The majority of people tried to repay their debts for two or more years before seeking debt relief. Although the rise of seniors going bankrupt has emerged as a new trend, young and middle-aged people still account for the majority of bankruptcy filers.

When debt overwhelms a person, threats of repossession, foreclosure or wage garnishment could add to the stress. A conversation with an attorney about bankruptcy could inform someone about the potential for debt relief. A lawyer could analyze an individual’s income and debts and explain how a Chapter 7 or Chapter 13 bankruptcy might resolve the problem. If a person decides to file, then an attorney could prepare financial disclosures for the court and assume communications with creditors. The advocacy of a lawyer might enable a person to start over with a manageable payment plan or discharge of debts.

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Consumer debt is creeping up on many households

On Behalf of O’Brien Law Firm, LLC

Posted on: August 9, 2018

A cautionary tale is being given to consumers after some in the financial world are looking backward to 2008. Those in Mississippi and elsewhere in the country may want to pay heed to the warning.

During the housing and financial crisis of 2008 and the subsequent recession many not only had a larger housing debt than practical, but consumer debt was also higher than ideal. With the recession, nearly 10 percent of credit cards had at least one missed payment.

But while the recession was ongoing, nearly one half of consumers with credit cards were making an effort to pay down their credit card debt. Either by force or by choice, American consumers became more frugal. Better times often lead people to return to bad habits. Some feel Americans are returning to bad credit habits. The beginning of 2018 showed that consumer debt has reached an all time high.Though credit cards are a part of this debt, the new household debt focuses more on vehicle and student loans. Payments on each of these debts have an effect on the household budget. The fear isn’t so much the present ability to pay as most are meeting obligations.

The fear is that should a downturn in the economy take place, Americans have not left themselves enough of a cushion to weather a storm. A re-evaluation of spending habits as they apply to consumer debt is warranted. Cutting back on spending by 10 percent, avoiding revolving debt for nonessential items and always making more than the minimum payment are some suggestions.

An interruption of household income, even briefly, can have a substantial effect on household finances. In some cases, the situation may not be recoverable without assistance. In these instances, a consultation with an experienced bankruptcy attorney may open up options the debtor has not considered.

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How to recognize debt settlement scams

On Behalf of O’Brien Law Firm, LLC

Posted on: August 5, 2018

If you, like so many others, have found that overwhelming debt has become a fixture in your life, you may be exploring your options and trying to figure out how to get your finances back under your control. People in your circumstances often feel hopeless, but the good news is, there are a variety of options that may meet your needs. Regrettably, however, some companies tend to prey on those struggling with seemingly insurmountable debt, and they do not always engage in ethical tactics when doing so.

For example, if you are facing massive amounts of, say, credit card debt, you may start receiving offers from so-called debt settlement agencies that attest that they can resolve your debts for only a small fraction of what you owe. Sounds great, right? Keep in mind, however, that, as with many things in life, if something seems too good to be true, it just well might be.

Why you should be wary

Typically, debt settlement companies will tell you they can negotiate with your creditors and argue down the amount of debt you owe. The problem is, however, your creditors have absolutely no obligation to follow along with the debt settlement agency’s proposal, so what your debt settlement representative tells you may be far from the truth. A debt settlement company may also avoid telling you about other potential risks associated with the process, which might include your credit taking a serious hit, debt collectors continuing to blow you up, and so on.

Spotting potential scams

While debt settlement agencies may prey on your stress and desire for a fast solution, there are key signs to be on alert for that should serve as red flags. More specifically, think twice before signing on with a debt settlement company that charges upfront fees, or one that instructs you to cease all communications with your creditors without explaining the potential risks involved in doing so. Similarly, avoid signing on with any company that makes guarantees about eliminating your debt, as again, your creditors have no obligation whatsoever to comply.

Despite what debt settlement companies tell you, signing on with one is rarely your best option. Consider alternatives before signing on with a company with unethical intentions.

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