EXPERIENCE COUNTS.
ASSISTING LONG ISLANDERS AT THE SAME LOCATION FOR 25 YEARS WITH THEIR MORTGAGE AND DEBT PROBLEMS

FRIENDLY, AFFORDABLE AND KNOWLEDGEABLE Chapter 7 Chapter 13 Loan Modifications
How a Loan Modification May Help Reduce Your Monthly Mortgage Payments For homeowners struggling to keep up with their mortgage payments,there are programs available to help avoid foreclosure. However, because these programs are legal agreements, it is prudent for borrowers to consult a lawyer. One viable alternative to foreclosure is a loan-modification program that is an adjustment to the terms of the existing mortgage. Loan modification is designed to provide either temporary or permanent financial relief by reducing the amount of the monthly payments via a reduction in the principle, interest rate or by extending the term of the loan.

Loan-Modification Options

There are several forms of loan modification, with some being better than others. However, the lender that holds the mortgage may not provide all the available loan-modification types.

The full list of options include:

Will Filing for Chapter Bankruptcy 13 Ruin My Credit Score?

When you decide to file bankruptcy, it will be reflected on your credit report for years to come. As such, there is really no way around the brutal truth that filing will have a negative effect on your rating. If you are able to afford a repayment plan, choosing to file under Chapter 13 bankruptcy may help you recover more quickly and save your financial reputation.

Why Creditors Prefer Chapter 13 Instead of Chapter 7

It's no secret that lenders prefer Chapter 13 filing to that of Chapter 7 bankruptcy, but why exactly is this? It basically boils down to the fact that with Chapter 13, your creditors have some hope of future payment. In contrast, when you file under Chapter 7 bankruptcy, if you qualify, their chances of receiving any payment is dim.

Your Credit Score Under Chapter 7 Bankruptcy

Under Chapter 7, unsecured debts, such as medical bills and credit card companies, don't usually receive any kind of payment. This is because Chapter 7 doesn't require you to make payments to creditors or set up any kind of payment process. Instead, any owned property that cannot be protected under your state's exemption laws must be turned over to a trustee that is assigned by the court. Your trustee then sells the property for whatever they can get for it and uses the proceeds from the sale to pay off your creditors. However, most filers are able to exempt the majority, if not all, of their assets, thus keeping them out of the reach of the court. This means there is often nothing left to pay off the creditors.
For many consumers, getting a fresh start and putting past financial obligations behind them can be achieved by filing for Chapter 7 bankruptcy. Many people get so over their heads in debt that this is the only way to get out. In order to do so, they will need to work on their credit score by taking the right steps. This includes keeping all credit card balances low and paying off bills on time or even before the due date. However, it is important to realize that filing for Chapter 7 bankruptcy won’t just magically repair a credit issue overnight. It can take ten years for a bankruptcy to disappear from a credit report, depending on the exact bankruptcy chapter that was filed by a qualified attorney. Upon successfully completing your Chapter 7 bankruptcy process, our firm is happy to provide credit repair as a service to help expedite the process.

Understanding Your Credit Report

Many people are very surprised at the types of personal data a report contains. To be specific, you can expect to see these three different kinds of information:

•P...
Chapter 7 bankruptcy may be a way to solve your financial problems, but it is not the only way. Chapter 7 bankruptcy liquidates nonexempt property to equitably distribute your wealth to your creditors. If you own a small business or sole proprietorship, you can file under Chapter 11 to liquidate a few nonexempt assets to pay settlement amounts on your delinquent accounts, make extra payments to reduce the principal, or extend the duration of your loans, sales contracts, or leases. Under Chapter 11 or Chapter 13, you can reduce your installment payments by paying for three or five years. You may be able to increase your cash flow by removing encumbrances from your mortgage or your primary business property. If you owe primarily taxes, child support, student loans, or accounts secured by collateral, you can’t discharge or liquidate them. You can file a Chapter 13 repayment plan to repay your secure creditors over three to five years.

Pass the Bankruptcy Means Test

The means test calculates your disposable income. You must pass the test to qualify for liquidation of your nonexempt assets and discharge of your past due accounts. High income does not disqualify you. High income individuals with unusual expenses, such as, high mortgage or car loan payments, delinquent taxes, school loan payments, child support arrears, and medical bills qualify for Chapter 7 bankruptcy.

Official Chapter 7 Means Test calculation

The official Chapter 7 means test calculation form attached to the U.S. Bankruptcy Court website begins with your monthly income adjusted with your spouse's monthly income. It considers the number of exemptions on your federal income tax form, and asks for your specific costs of food, clothing, health care, monthly mortgage or rent, other loans secured by your home, ownership and operating costs of vehicles, taxes (federal, state, local, self-employment, Medicare, and social security), telephone, and other necessary expenses. Your disposable income is your combined monthly income minus the summation of all your living expenses. Lastly, if your disposable monthly income times 60 is less than $7,700, you pass the test. If your disposable monthly income times 60 is more than $12,850, you are presumed to be abusing the Chapter 7 process.
...
One of the most important components of your overall financial health is your credit score. This is extremely important as it is an indication of your overall credit worthiness. Lenders and other interested parties will often use your credit history and scores to determine whether or not to provide you a loan. Beyond that, credit scores can also have an impact on your ability to get certain jobs, qualify for an apartment lease, or do any number of financial transactions. Since credit scores are so important, having a high one is extremely important. If you do not have a good credit history today, there is still a process that can be followed to help you to rebuild your credit and reputation. By following these credit repair strategies, you can see your credit improve both immediately and over a longer period of time.

1 - Review Your Credit Report

The first step in credit repair is to know where you begin. All three of the major credit bureaus are required to provide you with a free credit report on an annual basis. While the scores are not necessarily provided along with them for free, you can normally obtain them for a small fee. Since you are focused on improving your scores, paying this fee will be worthwhile as it will ensure you have a full understanding of where you stand. When you receive your credit report, you will be able to review both the summary and the detail behind it. The summary report will give you the aggregated credit scores, a summary of what has been negatively affecting your credit scores, and what is helping your scores. This information will allow you to understand what areas could be improved that will help to increase your credit reputation quickly.
Lawyers of distinction 2019

© The Law Offices of Adam C. Gomerman. All Rights Reserved. Disclaimer | Sitemap

Attorney Advertising. The material and information contained on these pages and on any pages linked from these pages are intended to provide general information only and not legal advice. You should consult with an attorney licensed to practice in your jurisdiction before relying upon any of the information presented here. The acts of sending email to this website or viewing information from this website do not create an attorney-client relationship. The listing of verdicts, settlements, and other case results is not a guarantee or prediction of the outcome of any other claims.

Law Firm Website Design by Law Promo