Vance P. Truman, Attorney at Law
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Medina Bankruptcy Law Blog

How can I get -- and stay -- out of debt?

If you're a Medina resident struggling with debt obligations, you are far from alone. It's frustrating to get hassled by creditors, which is why it is prudent to avoid running up debts in the first place.

That can be a bit like being told to close the barn gate after the horse has already gotten out, however. But it's still a good idea to learn some easy ways to avoid debt entirely, like the following:

  • If you can't pay with cash, don't buy/spend it.
  • Don't make impulse purchases.
  • Set spending limits and stick with them.
  • Comparison shop when possible for major purchases.
  • Pay off all credit card balances each month.
  • If you can't pay off the total, always make more than the minimum payments.
  • Transfer credit card balances to cards with lower interest rates — then close the other accounts.

Do you know how to stop the foreclosure process?

If you have fallen behind on your mortgage payments, you shouldn't be surprised if you receive a notice of foreclosure from your lender. Although it's scary, it doesn't mean your lender will show up at your home tomorrow and take it back. You still have time to make things right.

The key to saving your home from foreclosure is to understand your options. Once you know what to do, you're in position to take action.

Could you benefit from foreclosure affidavits and robo-signing?

When a bank or loan holder applies to foreclose on a property, there is a tremendous amount of paperwork that the loan officer needs to review. An important document that is included with this paperwork is a foreclosure affidavit. This affidavit is signed by the loan servicer as a way of verifying that he or she has reviewed and double-checked the accuracy of all the foreclosure documents submitted.

The thing is, many loan servicers are so bogged down with foreclosure paperwork that they do what's called "robo-signing." Essentially, they never double-check the accuracy of the paperwork in the foreclosure application, and they dishonestly sign the foreclosure affidavit vouching that they've reviewed the information when, in fact, they have not.

How long will it take until that foreclosure leaves your record?

Like bankruptcy, foreclosure stays on your financial record. It impacts your credit score. In the future, lenders will be able to see that you didn't pay on your loan and lost your house, and it can impact your ability to get new loans and lines of credit.

So, how long is this going to last? Generally speaking, the foreclosure will remain on your financial record for the next seven years.

4 reasons to consider Chapter 13 bankruptcy

Declaring bankruptcy is a big decision, and it is important to carefully consider all the potential benefits, weighing them against the specifics of your situation. Only then can you determine exactly what type of bankruptcy is the right fit for you and how to proceed.

To help you get started, here are a few reasons why you may want to consider Chapter 13:

  1. Collection activities against you have to stop. Are you tired of getting phone calls from the lenders? Are you sick of the threat of asset repossession? Once your bankruptcy case begins, all of that has to stop until the case ends. It gives you a much-needed break.
  2. It can stop foreclosure. This is the most serious type of asset repossession most people will ever face. Just filing bankruptcy creates an automatic stay. It saves your home on a temporary basis. It gives you a chance to work out the details and perhaps put an end to the foreclosure entirely.
  3. It gives you more time to pay off your debt. Chapter 13, unlike Chapter 7, does not focus on asset liquidation. Instead, it gives you a repayment plan. This buys you some time -- often, three to five years -- to pay your debt. If the problem is just that you can't pay it all at once, this is an ideal solution.
  4. You can get current on what you owe, including your mortgage. Your bankruptcy plan will carefully help you move forward so that the end result is that you are current on your payments once again, stopping the collections activities and eliminating the need for foreclosure.

What is the "meeting of creditors" in Chapter 7 bankruptcy?

Your Chapter 7 bankruptcy proceedings are all about absolving you of as many of your existing debt obligations as possible. This means that -- after selling off your unexempt assets -- the creditors to whom you owe money will not receive anything else, and your remaining debts covered by the bankruptcy will be dissolved.

Because this process will have a financial impact on your creditors, they will have the opportunity to ask questions about the process in a "meeting of creditors."

Get legitimate help when facing foreclosure in Ohio

When you can't make your mortgage payments, your lender could begin sending you foreclosure notices. Because you haven't paid your loan as agreed, your Ohio lender can threaten to take possession of your home, evict you and sell the property to recoup the loan.

Help!

Are you being targeted in a debt relief scam?

Ohio residents who are mired in debt can find themselves the targets of scams that promise to repair their credit and negotiate their payment obligations. Desperate people tend to latch on to anything that promises to help them out of their predicament. However, falling for one of these debt relief scams can only wind up costing you more of your hard-earned money.

These scammers look for consumers who have run up huge credit card bills. They may send fliers in the mail or "robocall" their victims. They promise to negotiate lower settlement amounts to creditors -- for a hefty fee, of course.

Filing bankruptcy comes with specific responsibilities

The crushing financial impact of being underwater in debt can make every aspect of your life miserable. When you are in this position, finding a way to address the debt becomes a priority. Some people might come out of the woodwork to offer you seemingly easy ways to get out of debt fast. Don't fall for these. The old adage "if it seems too good to be true, it probably is" definitely applies to these cases.

One option that can help you address the debt is bankruptcy, which is commonly handled through a Chapter 7 or Chapter 13 case. Many people aren't trying to do this because they want to pay for their bills. If you are thinking this way, remember that bankruptcy protection isn't an easy way out. Not only do you have to meet the requirements for the chapter you are going to file, but you also have specific responsibilities to uphold.

Study: The value of foreclosed homes is increasing quickly

The general trend for home values in the United States, in the wake of the recession and the dramatic dip in value that it created, has been a notable increase. While there are exceptions, many homeowners have seen the values of their homes rise.

However, a new study looked at homes that people lost in the Great Recession through foreclosure. What it found was very interesting.

Get the debt relief you need, the personal attention you deserve.

Call us today for a free consultation at 330-591-4729, or fill out the form below, and we will contact you.

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Medina, OH 44256

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