Category Archives: Empowerment

Lien Removal via bankruptcy

MortgageLaw

Lien Removal via Bankruptcy

By Ginger B. Kelly, Esq. May 23, 2018

Judgment liens on residential real estate or automobile titles can become a big problem for owners who want to sell or refinance. A lien is a type of instrument that secures a debt, similar to the way a mortgage secures a loan or note or a lien on a title can secure an automobile loan. Liens can be created for a number of reasons, like  to pay a judgment on a credit card debt, unpaid taxes, mechanic’s liens for unpaid services or water or sewer charges or any judgment in a lawsuit to pay a debt of any kind, even unpaid car loans or leases.

In Massachusetts, a lien from a judgment in a lawsuit is called an execution. The execution secures the amount that was awarded to the plaintiff and enforces the judgment awarded.  For example, credit card companies like Discover, Synchrony, Citi Bank or Bank of America, debt buyers like Midland Funding, and auto loan companies, like Wells Fargo and Ford Motor Credit, commonly record executions after receiving a judgment. Some companies even record liens before a judgment, if there is reason to believe the property will be sold or encumbered in any way.

There are only a few ways that a defendant may remove an execution, in Massachusetts. One way is if the debtor pays the creditor/plaintiff the amount owed on the execution. Then the creditor may ask the court to release the execution or lien. The other way is to pay the creditor a lesser amount owed, also known as a “settlement.” If the creditor agrees to a lesser amount, the creditor or the debtor can ask the court to remove the execution after the debt is satisfied by payment. Another option is if the judgment secured by the lien is vacated (i.e. thrown out). Without the underlying judgment, the execution can be released.  The only problem with this is that even if the execution is released, the debt won’t necessarily go away. The creditor might be able to re-file the lawsuit. A third option is to have the lien avoided in a bankruptcy.

When a homeowner files for bankruptcy in Massachusetts, he or she can claim a homestead exemption that protects between $125,000 and $500,000 in equity in their personal residence. The Bankruptcy Code allows filers to remove liens, also known as “avoiding” liens, like executions that impair this exemption. Once avoided, the lien can be cleared from the title by recording or registering orders from the bankruptcy court at the registry of deeds.

At the Law Offices of Ginger B. Kelly, we often obtain orders to clear liens from many of our client’s real estate, automobile titles and other personal property.  By obtaining and recording or registering orders from the bankruptcy court, we help many of our clients refinance or sell their homes and other property without problems stemming from a lien. If you have a lien that poses a problem for your property, talk to us (free of charge) and we will evaluate your options.

The Law Offices of Ginger B. Kelly is now accepting clients in the Sturbridge, Southbridge, Dudley, Webster, Oxford, Charlton, Auburn, Spencer, Brookfield, Warren and all of the Worcester County Area. We can explore whether or not bankruptcy is the easy way out or not.  We have a comfortable place to talk and a fresh cup coffee waiting for you.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture.

To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.

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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2018 by Ginger B. Kelly, Esq., all rights reserved.

 

 

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Filed under Auto Loans, Bankruptcy, Chapter 7, Collection, credit card debt, Debt, Debt Collection, Empowerment, Execution, Filing, Judgements, Law, Lawsuits, Legal, Legal Rights, Liens, Massachusetts, Massachusetts law, Mortgages, Rhode Island, Short Sale

Property Transferring No No’s, Before Filing Bankruptcy

Money in an envelope

Property Transferring No No’s, Before Filing Bankruptcy

by Attorney Ginger B. Kelly, February 23, 2018

There are a few types of transfers that will definitely not help if you want to file for bankruptcy to get a fresh start. One of those is types of transfers is called a prepetition transfer or (in other words) a fraudulent or irregular transfer.

Essentially, a prepetition transfer is a transfer of property (money or other things, including real estate) given to a person or creditor within 90 days from the date you file your petition. A prepetition transfer may also be a transfer of any property (money or other things, including real estate) to any insider, like a business partner, family or friend, within one year of your bankruptcy filing. Prepetition transfers are one of the biggest reasons why it is important to consult with a qualified, experienced, bankruptcy attorney, before you file. The prepetition transfer follows something called the 90 day rule.

Basically, the 90 day rule relates to debts that a debtor has paid, while insolvent, within the past 90 days of filing their bankruptcy petition and is set forth in section 547(b) of the Bankruptcy Code. The 90 day rule generally means that the US bankruptcy trustee has permission to avoid, (which means unwind or undo), any transfer made to a creditor or an insider if the transfer had an aggregate value of $600 or more provided that the transfer was made within 90 days from the date of the bankruptcy filing, and for any transfers made up to one year, if the person who received the transfer was an insider.

Here are a couple of examples of a fraudulent or irregular transfer:

Jane wanted to settle a debt before filing. She saved around $3,000 and was successful in negotiating with creditors to pay off one of her credit cards. Jane negotiated a settlement with blue credit company for $700 on October 30, 2017. She negotiated another settlement and paid red credit company $1,000 on November 1, 2017. After Jane negotiated successfully, with blue and red credit companies, she tried to negotiate with orange and green credit companies. She was unsuccessful. So Jane filed her bankruptcy without an attorney. Since she paid $700 to blue and $1,000 to red, her US Trustee avoided these transfers to get the money back. The trustee will allow all of Jane’s creditors to receive an equal share of the $1700 and prevent one particular creditor from benefiting more than the others. This is just one example. There are more.

The second section of the 90 day rule allows bankruptcy trustee to avoid any transfers of property made to any creditor that is also an insider (i.e., business partner, relative or friend) made between 90 days and one year of your bankruptcy filing date and exceeds and aggregate value of $600 or more.

In the next example, Steven bought his daughter Karen, a $15,000 car for graduating college. Steven paid $5,000 from funds he kept in his savings account and made the remainder of the purchase from a $10,000 line of credit on his credit card. On June 30, 2017, Steven transferred the title, over to his daughter.  In September of 2017, Steven lost his job. He was no longer able to make the remainder of Karen’s car payments. After four months without a job, Steven’s debt was piling up. So, in January 2018, Steven decided that he wanted to file chapter 7 bankruptcy to get a fresh financial start. If Steven were to file for bankruptcy before June 30, of 2018, there may be a good chance that the trustee would be able to avoid the car title transfer he made to his daughter, Karen. This would put the vehicle Steven just purchased for his daughter at risk. If Steven’s bankruptcy attorney knew of this transfer, the attorney would have warned Steven of the issues involving the purchase of Karen’s car prior to filing.

The fraudulent transfer rule involves all property, not just cash, and also applies to both chapters 7 and 13 bankruptcies. There are only a few exceptions. One, for example, is the exception for transfers made in the ordinary course of business, in other words, the property was sold to another (not an insider) for a fair and accurate value. But even so, bankruptcy can get complicated and for most folks, an attorney is usually needed to help out. Some people can’t imagine how to pay for a bankruptcy when they have no money. I’ll talk about that more, in my next article.

For now, if you’d like to set up an appointment to talk about affordability and your available options, call me. We can talk, face-to-face, and explore your options over a nice cup of coffee or tea.

The other day, a new client couple asked whether or not they should she use their tax return tax refund to pay down their credit card bills or use their tax refund to replace the roof on their home. Their roof needed repairing badly. Their credit card debt was very old. I cannot make that final decision for any of my clients, but I can advise them of their options. If you are in a position where you need to make important decisions like paying your credit card bills or paying for something extremely important, like a roof on your home, it may be a great idea to talk to a good attorney. Most give free first consultations.

If you are contemplating bankruptcy, and have some questions about a transfer you may have made or the 90 day rule, The Law Offices of Ginger B. Kelly is now accepting clients in the Sturbridge, Southbridge, Dudley, Webster, Oxford, Charlton, Auburn, Spencer, Brookfield, Warren and all of the Worcester County Area. We can explore whether or not bankruptcy is the easy way out or not.  We have a comfortable place to talk and a free pot of coffee waiting for you.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.

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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2018 by Ginger B. Kelly, Esq., all rights reserved.

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Filed under Bankruptcy, Chapter 7, Choosing a lawyer, Collection, credit card debt, Debt, Debt Collection, Deficiency, Empowerment, Filing, Financial, Judgements, Law, Lawsuits, Massachusetts, Rhode Island, tax refund, tax return, Uncategorized

Student Loan Debt and What to Do about it

Oh the places youd go if you weren't riddled with student loan debt

By, Attorney Ginger Kelly, November 9, 2017

According to US News, about half of all Massachusetts workers have some sort of bachelor’s degree.  That means high rates of student debt plague our state. But even worse, according to the Boston Globe, over 50% of college students in Boston drop out of college. That leaves even more people strapped by student loan debt without a degree.

When the national average for student loan debt almost reaches the $38,000 mark, it’s no wonder why student debt is becoming truly a national crisis. But where there’s a will, there’s a way. For some college grads, the best strategy is to be aggressive with paying back student loans.

For one college grad, Meghan from Boston, who paid  back her student debt within five years, it was all about prioritizing. “It’s possible if you want it badly enough,” she said. Meghan itemized her debt wish list and named her reasons for wanting to be debt free. Writing down your reasons helps to keep you on your journey. Being able to refer back to those reasons helps to overcome challenges and to remember why you’re making sacrifices.

Another college grad, Jason, felt overwhelmed while trying to pay the minimum on his $45,000 student loans.  So he took a different path and got serious about paying down his student debt. He reviewed every portion of his bank account, tightened spending, worked two jobs, and established a “done with debt” deadline. This helped Jason pay off his student loan debt in less than a year. Jason said that he kept spending very low and worked hard at his corporate job and also side job to pay off debt.

Aggressive payment plans are fine for some, but for those with small children and other priorities, aggressively paying off student loan debt is not always practical or attainable. Never the less, a few tips for grads may be helpful, while keeping in mind that every situation is quite different.

Start saving during the grace period: Use the grace period to review repayment options and figure out what is most affordable for your situation.

Choose a short repayment plan: Try to choose the shortest repayment plan you can afford, if you can do this without eating cat food and borrowing your sister’s car constantly. Although extended payment plans have lower monthly payments, the total interest will more than double for doubling the time.

Pay off expensive loans first, with one caveat: Some financial gurus believe that prioritizing paying off loans with the highest interest rate first is a good idea. But because not all situations are the same, this may not be the best strategy for getting out of debt quickly. Each situation is different. More on this to follow.

Trade your service for your debt: Certain programs, such as AmeriCorps, erase part or even all of a federal student loan. A year of service at AmeriCorps can pay for around $5,645 of your loan. Honestly, I know of no one who paid off their student loans by volunteering in AmeriCorps, but it’s an idea that’s out there.

Keep close contact with your lender: Be sure to tell your lender if you plan on moving or changing your phone number or email address. If they need to contact you but you are unavailable, this could add to your costs. Running the risk of missing payments or other important information is not an option.

Enroll in an ACH direct payment withdrawal option: Enrolling in ACH direct payment withdrawals will not only keep you from missing your payments, it allows for a .25% interest reduction rate for all federal loans and most private loans.

Those are the tips most financial gurus tell us.  However, most folks aren’t going to pay off their student debt by volunteering in AmeriCorps. But it’s an option. Most folks don’t work for in a low paying public service job, nor do they want to. Public service is only an option, not the only path.

Most people, graduates especially, have different types of debt and families with children. People in this category may choose to reduce or pay off their overall debt and just pay the minimum on lower-interest student loan debt until it makes sense to pay this off with a more aggressive student loan payment plan in the future.

*More about paying off expensive loans first: Although this makes perfectly good sense in some situations, the reality of life is that this is not always the best plan. Alternatively, it’s may be a better idea to lower your debt using a different strategy, like zero interest transfer options.

To start on the path to a zero interest transfer option, begin by paying down higher balance debt first and watch your credit scores climb. Then, find one or two zero interest transfer options to get rid of expensive debt and provide more time to pay off overall debt. For a little more in-depth discussion about balance transfer options read,  “When balance transfers make good sense” by Attorney Ginger Kelly.

But it’s not always all about paying down student loans; becoming debt free and more comfortable in your own financial shoes is really about analyzing the total debt you have and working a strategy that makes good sense from a credit bureau point of view.

Total debt to income is what really hurts a person’s ability to feel more confident, secure and to enjoy life a little better. If you want to make a change for the better, maybe get out of your parent’s basement quicker, work on your student loans after trying these strategies. Notice, I did not say simple strategies. They aren’t simple and take time. So be patient. Patience is a virtue, so they say.

1. Lower your total debt to credit ratio: Prioritize personal and consumer loans (like credit cards) to lower your total percent of used to unused credit and really make your credit scores soar. Doing this will lower your total debt to available credit ratio. Having higher percentages of unused credit for all your debt will lower your debt threshold and increase your credit scores. Higher credit scores are what you need to get lower high interest rates or no interest credit card introductory rates with low fee balance transfer options. This plan is not instantaneous (like most good things), but over a year or less many college grads, and people in general, can increase their credit scores 50 to 100 points or more. But wait. Besting your best credit scores isn’t all there is to it.

2. Don’t close old credit card accounts. Then, never ever close old credit card accounts. Keep them, at least for a long while until your 100% confident it makes no sense to have better credit scores. Closing old accounts will damage your credit scores. Damaging credit scores while paying off debt can take you back to square one. Keep old credit cards and move on to the next step.

3. Find zero or low interest balance transfer cards, and use them. With a credit score of 700 or better, don’t run out and finance a new car but rather, find the best lower interest or no interest balance transfer cards by looking, very hard, online. Do the research and find the best deals and then transfer balances from higher interest credit cards to lower or zero balance cards.

Many times, frugal websites like Andy Prescot’s “The Art of Being Cheep”
help with the initial research. Nerdwallet.com and MagnifyMoney.com are also helpful websites. Magnify Money has a great chart on the best balance transfer credit cards and an idea of what kind of credit scores you need to get them.

4. Use the zero balance time to aggressively pay down all revolving debt. With a zero or low interest credit card introductory rate, take this time to aggressively pay down all your credit cards. This will help your credit to grow.

5. Now it’s time to say good bye to student loans. At this point, with better than average credit scores, you have placed yourself in the best position possible to become more pro-active regarding paying down student loan debt. Student debt tends to be the lowest interest debt most people have. So why not make the most of the bargain and aggressively pay down this type of debt last and not first. Manage your debt before you debt manages you.

If there is no way to pay down your debt or debt is managing you, or even killing you, talk to a good consumer debt lawyer or bankruptcy lawyer immediately. Sometimes, they can advise you on which debt to pay first or not and whether or not bankruptcy is an option to explore. Most offer free first consultations.

My advice to people is to find at least three lawyers who offer free first consultations. Visit all three and compare. Pick the lawyer that makes the best sense to you, one that you can talk to, and then stick with that lawyer. Not all lawyers are perfect, remember this. But finding a good adviser who can help you manage your finances and deal with overwhelming consumer and student loan debt is like finding gold when you least expect it.
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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit, http://www.attorneykelly.com or call us at (508) 784-1444.
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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We can not stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2017 by Ginger B. Kelly, Esq., all rights reserved.

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Filed under balance transfers, Bankruptcy, credit card debt, Debt, Empowerment, Financial, Financial Planning, Massachusetts, practical stuff, Student Loan Debt, Trending, Uncategorized