We suspected it all along: during the mortgage bubble, banks were making bad, foolish loans to people who couldn't afford them, hoping to either get the money back later by refinancing with new buyers or taking the home equity later through foreclosure. When the house of cards finally collapsed, we the people were left holding the bill. But at last, our Courts have done us some good. A federal jury in New York found Bank of America liable for fraud last week. Why? Their own employees testified that they were pushing loans through the system as fast as they could, overriding their own procedural safeguards and completely ignoring federal regulations designed to prevent mortgage meltdowns.
You can read the article here.
Today we confirmed four Chapter 13 bankruptcy cases in the Southern District of Alabama. One of them I'd like to talk about is Mandy Green.*
Mandy came to us with $12,400 of credit cards and $13,000 of state and federal income taxes. She has a small house that she has worked hard to keep and a car that she needs to get to work. She was current on her vehicle, so she didn't really need help there – it was the IRS threats of imposing a tax lien that were really scaring her. We determined that Chapter 13 was the best route for her because Chapter 7 would have put her in danger of losing her home equity.
We designed a plan for her to pay off her car and get rid of her tax debts and credit cards in 5 years – for under $600/month. Before she came to our office, her car payment alone was over $500, and she had almost 5 years left on that auto loan. So for $100/month, Mandy was able to get rid of all of her taxes and credit cards in 5 years. She was very happy with that deal and now she can get back to working and living her life without fear of losing it all.
*Names were altered to protect client confidentiality.
Today in District Court, we did it again. The Mobile Bar Association's Volunteer Lawyer Program sent me a client on Friday - she had a court date today. This was less time than I'd have preferred to plan a defense of her case, but I went for it anyway. The collector was suing my client for $3,187 on an old loan from Citi Financial. She was a single, working mother of three and has an 11 month old baby girl. My client has a job, but she cannot afford her paycheck to be garnished - not with two teenagers in school and a baby to take care of. So I went to court for her and challenged the collector's proof. I won. She no longer has to worry about that debt and it should soon be deleted from her credit report.
Another debt bites the dust.
Mrs. H--- came to us months ago. She had lost her job because of a seizure she had at work, and she tried to find new work for months after that, but couldn't. Finally, she filed for disability back in September of 2011. Her application was denied, not because she wasn't a hard-working, meritorious citizen, but because she had a complex case. Rather than a single, obvious medical condition like a broken leg, Mrs. H--- had several health problems - bad vision, seizures, a blood disorder - which combined to make it impossible to work a full-time job. But with no income and no benefits, she was stuck. She found a light duty job working part-time at a department store, but those minimum wages for a few hours a week didn't do much. She had to rely on friends and relatives for nearly everything.
Last Thursday, I went to the District Court of Mobile County, Alabama to defend a client from a debt collection lawsuit. The client had been sued by a collector seeking a $9,951.12 from an alleged debt to Beneficial Financial. The debt collector had failed to provide the requisite proof of their case - they didn't have documentation of the debt and by challenging the sufficiency of their evidence, we succeeded in winning a judgment for the debtors.
What does this mean? It means that the debt is gone forever. Not only does the client not have to pay that money, it now has to be erased from their credit reports. A court of competent jurisdiction has declared that the debt is not valid, which means that it doesn't exist.
This just goes to show that it pays to hire a good debt defense attorney willing to fight for you in court. If you've been sued, don't go down without a fight. Call us and we'll review the case against you and do whatever it takes to protect your family and your finances.