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Stratford Bankruptcy Blog

Distressed homeowners should be wary of foreclosure scams

Purchasing a home is an achievement that many Connecticut residents cherish. For some, a home purchase is the culmination of years of planning, and the end result is a property where children are raised, milestones are reached and memories are built. When financial troubles arise, the risk of losing their home to foreclosure can lead people to do many things that they might otherwise avoid. That can leave them at risk of scams, of which there are many.

One such scam has led to prison sentences for three men. The three were part of Star Reliable Mortgage, a company that claimed to offer assistance to homeowners who were facing foreclosure. Clients of Star Mortgage were told that in exchange for upfront fees, they would be able to own their homes "free and clear." Many paid between $2,500 and $4,500 for the company's services.

How Chapter 7 bankruptcy can impact a 401(k) account

When a Connecticut resident is considering bankruptcy options, one of the most important considerations is how that choice could affect retirement savings. Many people spend the bulk of their adult lives setting aside money to fund retirement. They are concerned that seeking bankruptcy protection could jeopardize their savings, leaving them unable to retire as planned. The following information is offered in the hopes of clearing up the impact that Chapter 7 bankruptcy can have a 401(k) account.

During Chapter 7 bankruptcy, some of an individual's assets may be liquidated under the direction of the trustee. The resulting funds are then used to repay creditors. However, there are regulations in place that control which assets are subject to liquidation and which are afforded protection during the bankruptcy process.

Study focuses on reasons behind need for debt relief

Virtually all Connecticut residents have struggled with debt at some point in their lives. Whether debt comes from an unexpected medical issue, a college education or simply the need to replace a car engine, it can be stressful to live with the knowledge that those bills are out there, just waiting to be repaid. Many people are not even aware of how they got into serious debt problems. They seek debt relief services, which can relieve some of the pressure. That said, unless a consumer is fully aware of how he or she got into trouble in the first place, there is a significant likelihood that high debt will return in the years to come.

A recent article looks at the way that the human brain processes the concept of credit, and found that we may not have the ability to fully comprehend the concept of credit. At the root of the problem is the disconnect that occurs when someone pays for goods or services using a piece of plastic, rather than pulling out cold, hard cash. The idea is that when a person has a wallet that holds one's entire discretionary spending budget for a given period of time, there is a physical change that occurs when those bills are removed and handed over to pay for things. When a credit or debit card is used, that tangible reminder of depleted funds is simply not there.

The best debt management tips and techniques for young adults

Not so many decades ago, most young people had little concern about debt and how to manage it. Debt was something that came later in life, once someone settled down, purchased a home and started a family. Today, however, many people in their 20s are already saddled with high levels of debt, and are looking for a way out. The following tips can help young Connecticut residents with debt management, helping them to enter their 30s free of a heavy financial burden.

The best place to begin is by finding a solid debt management plan. For some people, that means purchasing a money management book and following the guidelines laid out within. For others, working with a law firm that specializes in debt management is a good plan of attack, and provides the guidance and feedback needed to stay on track and reach goals.

A different approach to life after successful debt management

For many Connecticut families, managing debt is a top priority, and one that can change the course of family finances for the better. In some cases, it takes years of debt management efforts to reach a state of equilibrium, where paying down remaining debt is not only possible, but easy to work into the family's budget. For these households, looking for ways to reduce spending in the future is an important part of preserving financial stability.

One way to shift spending habits is to take a different approach to the accumulation of things, and re-evaluate the value that so many people place on tangible items versus experiences. There are quite a few sayings that underscore the impermanence of physical things. "You can't take it with you when you're gone" is a primary example. Those sayings are so common that most people don't stop to think about the true message behind the statement.

Why personal bankruptcy is an option for senior citizens

Many Americans were raised on the belief that if they worked hard and followed the rules, then financial success would be a guaranteed outcome. In reality, however, things are not quite that simple. There are many ways that senior citizens in Connecticut and other areas of the nation can encounter financial turmoil after spending their entire early and middle adulthoods playing by the rules. Fortunately, there are ways to overcome high levels of debt, including but not limited to filing for personal bankruptcy.

One issue that older Americans face involves the high cost of medical care. Even when someone has medical insurance or Medicare, it is still possible to rack up high levels of debt in relation to necessary medical care. Once those bills begin to get out of hand, it becomes very difficult to gain control and pay down those obligations. That is especially true for those who are living on a fixed income.

Will Chapter 7 bankruptcy increase if health bill passes?

Most Connecticut residents are aware that health care has become a primary area of focus for the new administration. In fact, the Senate is considering a revised health bill that has led to a great deal of debate. Some experts believe that if the bill should pass, then 15 million people could lose their Medicaid coverage. They go on to suggest that an increase in Chapter 7 bankruptcy could quickly follow.

Medicaid currently covers nearly 74 million Americans who fall into the low-income bracket. That accounts for nearly a fifth of the population. Those folks already live under heavy financial strain. Losing access to their health care coverage could be the proverbial straw that broke the camel's back.

Company penalized for consumer foreclosure actions

When an individual or a family is faced with serious financial problems, few things are more stressful than the risk of losing their home. In many cases, home ownership was a long-held goal, and achieving that goal was a significant source of pride, and a realization of the American Dream for Connecticut residents. When it appears that foreclosure is imminent, many people will go to great lengths to avoid that outcome. Unfortunately, that leaves them vulnerable to a number of questionable business actions in addition to downright scams.

The Consumer Financial Protection Bureau (CFPB) has fined Fay Servicing more than $1 million. That fine is intended as a response to what the CFPB calls "illegal foreclosure practices" that harmed borrowers that the company claimed to have served. Specifically, the company was found to have kept borrowers in the dark regarding information about how they could apply for foreclosure relief. Fay Servicing was also found to have moved forward with foreclosing against borrowers who were in the process of seeking and applying for assistance. In certain cases, the company pushed foreclosures through to completion even as the homeowners were actively pursuing options to allow them to keep their homes.

Understand the importance of utilization in debt management

For those in Connecticut who are considering filing for personal bankruptcy, repairing the damage done to their credit score is a top priority for the months that will follow the bankruptcy process. Having that kind of forward-facing focus can make it easier to begin the steps leading to bankruptcy, which is a decision that no one wants to have to make. Fortunately, there are plenty of positives that accompany the choice to seek bankruptcy protection, including the opportunity to rebuild toward a solid credit score by using savvy debt management practices.

One of the most important aspects of credit repair involves credit utilization. This is simply the amount of available credit that a consumer puts to use. In order to increase credit scoring, it is necessary to use only a small portion of that available credit. Experts suggest charging between 10 and 30 percent of each credit card's limit.

Options for when Chapter 7 bankruptcy disappears

For many Connecticut residents, the decision to file for bankruptcy comes at a time of significant stress. It is easy to become overly focused on the negative aspects of Chapter 7 bankruptcy, while overlooking the fact that the bankruptcy process is a springboard toward lasting financial stability. A recent article looks at bankruptcy statistics, and notes that millions of Americans will soon have their personal bankruptcies removed from their credit reports.

According to researchers, the year 2010 saw a significant increase in the number of personal bankruptcy filings. Chapter 7 bankruptcy peaked that year, largely due to the housing crisis and economic instability. As we are now approaching the seven year mark on these filings, many consumers will soon see their personal bankruptcy drop off of their credit reports. That can lead to an improvement in credit scores and the ability to move forward with new financial aspirations.

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