Have you received a letter or have been served a lawsuit over a debt you owe from a third-party debt collector? Tampa Consumer Protection Attorney Jeffrey Hakanson explains the small claims process, and what can happen if you do not appear in court to contest the debt. It is critical that you enlist the guidance of a trusted consumer protection lawyer who will defend your rights and fight any third-party debt buyers on your behalf. If you are having a problem with a creditor, contact us at (844) 511-4800 today to learn what your options may be.
Author: Jeff Hakanson
Have you been summoned to a pre-trial hearing for debt collection?
Here is what you should know if you are summoned to a pre-trial hearing for debt collection.
There are several things you should know as a consumer to protect your rights in a debt collection case. In this video, Florida Consumer Protection attorney Jeffrey Hakanson explains the procedure, possible outcomes, and rights you must have protected during this process, including State exemptions such as the Homestead Exemption, Head of Household Exemption, Veterans Disability Exemptions, and more. Mr. Hakanson has experience and knowledge in defending the rights of consumers against the collection of social security benefits, social security disability benefits, and other state exemptions that do not allow creditors to garnish your wages in order to collect on debts. In some cases, you may be able to protect your home, 401k, IRA account, and other personal accounts from being subjected to garnishments.
If you are facing a pre-trial hearing for an unpaid debt, or need the consultation of an experienced consumer protection and debt relief lawyer in Florida, contact the law firm of McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A., today, to ensure your rights are protected. If you are having a problem with a creditor, contact us at (844) 511-4800 today.
The CFPB Takes on the Payday Loan Industry with Proposed Rules Changes
The payday loan industry has provided a quick and convenient way for Americans to meet their financial needs when life’s issues arise. However, over the years that convenience has come at a heavy price. According to a study by the Pew Research Center, the average payday loan customer spends an average of $520.00 in fees in order to borrow $375.00. These loans have an average annual percentage rate of around 390 percent. Payday loans are often the last resort for people who need money quickly and have no other way of getting it. Unfortunately, payday loan companies have taken advantage of that.
To combat these numbers and some of the tactics that the payday industry employs, the Consumer Financial Protection Bureau has proposed several new rules. The average payday loan borrower spends nearly half the year in debt. These changes are designed to make it easier for customers to get out of debt after they have received a payday loan.
Here’s what you need to know about the proposed rules changes:
- CFPB is proposing a “full payment” rule: CFPB is proposing that all payday lenders be required to verify that a borrower can afford to repay their loan while paying for basic living expenses and other debt.
- CFPB wants to put an end to “debt traps”: CFPB is proposing a rule that would limit the ability of payday lenders to grant the same loan or similar loans in consecutive months. It also puts restrictions on rolling over loans after they have been repaid or refinancing current loans.
- Notifications when an account is being debited: CFPB proposed that payday lenders be required to give a notification to a customer at least three days prior to debiting their bank account. Many payday loan customers have payments automatically debited. This can be problematic if the customer doesn’t have the money to cover the payment as they typically incur fees from their bank and the payday loan lender.
- Why can’t you get a payday loan from your bank? Experts speculate that larger banks are currently not doing payday loans because of a lack of regulatory standards in the industry. This leaves the industry to companies whose practices don’t typically favor customers.
- How will CFPB determine if their proposals have merit: The proposals are open to public comment from now until September 14th.
Contact the consumer rights attorneys at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A. today. Their personal approach will help you achieve the results you need. Contact them today at 844-511-4800.
What is CFPB?
Our culture has long celebrated the symbols of affluence. Houses, vacations, the ability to shop for the best items, and eat plenty of the most delicious foods. It’s hard not to become engulfed in the desire to have material possessions because we are immersed in the narratives of those that have them. While there are plenty of “rags to riches” stories focusing on working hard to get ahead, patience isn’t always easy to exhibit for many of us and unfortunately that’s where the seeds were planted that made activities like predatory lending and other questionable financial practices take hold. These practices are largely responsible for the Financial Crisis of 2007–08, one of the worse since the Great Depression. The Financial Crisis led to the collapse of businesses, the profound adjustments of industries, and left millions of people in financial ruin.
In an effort to protect beleaguered consumers, the federal government created the Consumer Financial Protection Bureau (CFPB). CFPB’s primary purpose is to protect consumers and serve as a regulatory force in the financial services industry. They are charged with the task of governing a wide range of financial institution types, including banks, credit unions, mortgage servicing companies and debt collection agencies.
The broad range of organization types for which CFPB has enforcement power over comes from the number of regulatory agency responsibilities they are meant to consolidate. CFPB takes on regulatory responsibilities once belonging to the Federal Reserve, the Federal Deposit Insurance Corporation, the Department of Housing and Urban Development, the Federal Trade Commission and the National Credit Union Administration.
The CFPB that we see today, originates from an idea conceived by Harvard Law School professor and U.S. senator Elizabeth Warren, who described an agency specifically designed to protect the interest of consumers when dealing with financial organizations. Congress’ passing of the Dodd–Frank Wall Street Reform and Consumer Protection Act in July 2010 paved the way for the formation of CFPB. Dodd-Frank was created to bring sweeping regulatory reform to the financial industry and CFPB was created to be the driving force for that reform.
CFPB engages in a number of activities designed to serve its mission to enforce federal consumer financial law, ensure that consumer financial products and services are “fair, transparent and competitive”, to protect consumers and ensure that consumers “are provided with timely and understandable information to make responsible decisions about financial transactions.” These activities include:
- Conducting financial education programs
- Collecting, investigating and responding to consumer complaints;
- Collecting, researching, monitoring and publishing information that is pertinent to the motioning of markets for consumer financial products and services in order to identify risks to consumers, and to the appropriate functioning of markets
- Supervising constituents within the CFPB’s purview for compliance with federal consumer financial law; and dealing with violations of federal consumer financial law.
While CFPB serves an educational function, its primary purpose is to regulate the financial industry. Currently, CFPB has the power to enforce regulations under a number of statutes, including:
- Truth in Lending Act (TILA)
- Fair Credit Reporting Act
- Fair Debt Collection Practices Act (FDCPA), among many others.
As an enforcer of these regulations, CFPB has the power to determine if federal consumer financial law is being violated. If they determine that laws have been violated, CFPB has the power to force financial organizations to distribute refunds, pay fines, or incur civil penalties, among a number of other actions.
The CFPB has grown from the idea of Harvard professor to a well-established government agency with nearly 1,000 employees. Their aim is to protect consumers and right the wrongs of financial system that has caused hardship to millions Americans. While their effectiveness is widely debated, the importance of its existence is hard to deny.
The bankruptcy attorneys at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A. understand how daunting and demeaning financial difficulties can be. That’s why work diligently with each of our clients to understand the intricacies of their case, their goals and give thoughtful counsel to improve their situation. Contact us today at 844-511-4800.
Should Cities be able to Sue Banks for the Housing Crisis?
During the housing crisis of the mid-2000’s, cities across the country filled with foreclosed homes. These abandoned homes became symbols of dreams lost and easy targets for criminals. The housing crisis had a profound impact on our overall economy and in the financial lives of the individuals swept up in its wake. However, there was an unexpected victim in the housing crisis, that’s looking to hold banks accountable and recover losses of its own. You can click here now if you want to sell your house quickly and at fair offers.
Cities throughout the United States, including Miami, Oakland, Providence and Los Angeles are filing lawsuits against banks claiming that they suffered as well during the housing crisis. These cities contend that lending practices that either denied credit to individuals in certain neighborhoods because of race, or targeted home buyers in minority neighborhoods with high interest loans, led to increased foreclosures. These foreclosures are said to represent loss tax revenues and property values for these cities while increasing the costs of keeping surrounding neighbors safe. The cities are also contending that these practices are in violation of the Fair Housing Act, which “prohibits housing discrimination on the basis of race, color, religion, sex, or national origin.” The act allows individuals to sue lenders if they feel they have been discriminated against or if they feel they have been negatively affected by unintentional discrimination.
Currently, the city of Miami has recently filed lawsuits against a number of banks including Bank of America, Citibank and Wells Fargo. However, the Eleventh Circuit Court has sent the cases back to the lower court, which dismissed the cases. Now, Miami and other cities have filed an amended complaint. The city of Oakland filed a similar suit to which a judge declined to dismiss the suit.
While the argument for the cities being compensated for damages related to the housing crisis lie in the notion that lenders engaged in practices that would ultimately lead to foreclosures, the banks have a different point of view. Banks, like Wells Fargo, feel not only that the Fair Housing Act was not meant to come to the aid of cities, but that high interest loans were meant to provide opportunities for home ownership that would not be present otherwise.
The lawsuits by the cities represent a bold attempt to hold lending institutions accountable for the housing crisis, a feat that’s been difficult to attain to this point. Individuals, especially those who have been adversely affected by the housing crisis, typically do not have the resources to compete with the nation’s largest banks. If it is determined that they are unable to file lawsuits, the job of holding banks accountable falls on the justice department, or individual consumers through the defense of individual foreclosures on their homes.
If you are facing foreclosure, it’s important to know that you have options and that help is available. The Tampa foreclosure attorneys at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A. can establish a strategy for overcoming this difficult time. Contact them today at 844-511-4800.
4 Things you Should Know about CFPB’s Action Against the Nation’s Largest Debt Buyers
Last fall, the Consumer Financial Protection Bureau (CFPB) took a significant step in the fight against companies that prey on individuals dealing with debt. They completed an investigation that determined that Encore Capital Group and Portfolio Recovery Associates both participated in fraudulent practices designed to draw revenue from unsubstantiated or inaccurate debt and to pressure or mislead consumers into paying debt. Both companies, two of the nation’s largest in the debt buying industry, have been ordered to pay millions of dollars in penalties and halt portions of their overall collections efforts. The hope is that rulings like this will send a message to smaller companies that engage in similarly fraudulent practices, which will ultimately protect the consumer.
Below are four items of note in regards to this ruling:
So what did they do?
It was determined that both Encore Capital Group and Portfolio Recovery Associates participated in fraudulent practices that fit into three categories: collecting bad debts, illegal litigation practices, and illegal collections practices.
Both companies attempted to collect inaccurate or unsubstantiated debt. This was debt that they bought from other companies that gave approximate, instead of actual amounts of what was owed. In some cases, the debts they purchased did not reflect recent payments made by the debtor. However, both companies either investigated the debt to determine an accurate total or attempted to collect debt based on accurate totals.
Both companies filed lawsuits against consumers in order to collect debts. Neither company intended to defend the debt in any case. They simply filed suits in the hopes that the defendants would not address the case, making them the winner by default. They also filed documents that contained deceptive statements in debt collection. These statements indicated that legal action was warranted without doing the proper investigation for each case.
In terms of Encore, the company falsely told consumers the burden of proof was on them to disprove their debt. Encore also made harassing calls to consumers, often times calling them more 20 times in a two-day period.
What are the penalties?
Encore was ordered to pay up to $42 million in refunds. Portfolio Recovery Associates was ordered to pay $19 million in refunds.
Other penalties
The two companies have been barred from reselling the debts that they acquire. They must stop action on a number of debts they are currently attempting to collect. For Encore, they must give up $125 million worth of debt they were currently collecting. They must pay civil penalties to CFPB (Encore must pay $10 million and Portfolio must pay $8 million.)
In terms of consumer-facing actions, both must stop collecting debts they can’t verify. They must also ensure the accuracy of all lawsuits. They must also provide consumers with information about a debt, including the name of the creditor and charge-off balance, and offer to provide consumers with original documents relating to the account before they are can threaten or file a lawsuit to collect the debt.
Never heard of Encore Capital Group
If you haven’t heard of Encore, perhaps you’ve heard of their subsidiaries, Midland Funding LLC, Midland Credit Management, and Asset Acceptance Capital Corp. Together, they all form the nation’s largest debt buyer and collector. Portfolio Recovery Associates happens to be the nation’s second largest debt buyer and collector.
If you have fallen victim to the predatory tactics of debt collection companies, it’s time to talk to us. The bankruptcy lawyers at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, will review your case and defended your rights. Contact us today at 844-511-4800.
How does a foreclosure affect taxes?
How does a foreclosure affect taxes?
No one buys a home to foreclose on it. Foreclosure is one of the most difficult situations that individuals and families face. Homes are a part of us and when your home is foreclosed on, it feels as if that part of you is lost. Aside from the emotional part of foreclosure, there’s serious financial ramifications to be dealt with. And it’s not just credit damage or the loss of an asset. Foreclosing on a home can have tax implications as well.
A foreclosure is considered a debt cancellation. Debt cancellations are considered taxable according to the IRS. This is because it’s a reduction in the amount of money you typically owe. Many consider this a “phantom” income because the individual increased their taxable income without actually gaining additional funds.
So if the financial and emotional stress of a foreclosure is not enough. You may potentially pay m ore taxes as well. However, there are exceptions. According to the IRS, debt cancellation is not taxable if:
- You file for bankruptcy as debts cancelled in this situation are not taxable
- You are insolvent. If your total debts are more than the fair market value of your total assets than your canceled debts may not be taxable.
- Your loan is a non-recourse loan. If the only alternative for the lender is to repossesses the property in the case of default. The debt cancellation may not be taxable.
It’s also important to consider that if you have a home equity line of credit or a second mortgage and you have a foreclosure that it is also considered taxable by the IRS.
Foreclosure is traumatic from a financial and emotional standpoint. The help of a knowledgeable and experienced Tampa foreclosure attorney can make all the difference in the world. Contact McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A today at 844-511-4800 for help with this process.
The 3 Types of Foreclosure
The Types of Foreclosure
When people hear the word “foreclosure” they may not realize that there are multiple types. Each type of foreclosure has its own set of procedures and tends to favor one side (lender or borrower) over the other. The three types of foreclosure are judicial, non-judicial and strict foreclosure. In this article, we will describe each one.
Judicial: The form of foreclosure that most people are familiar with, judicial foreclosure is the process in which a court orders the sale of a property in order to satisfy a mortgage. The lender files a lawsuit against the homeowner and a formal notification is made. The homeowner is given a set amount of time to pay their debt. If they do not pay it, the property is sold at an auction and the proceeds from the sale are used to pay off the mortgage and any lien holders. This process is long and doesn’t provide a particular advantage for either party. Judicial foreclosures costs the lender and prevents them from gaining revenue while the process takes place. For homeowners, being sued and having an official notice appear on your property can be demoralizing. Foreclosures, in general, also damages your credit tremendously. A great alternative to a judicial foreclose is a deed in lieu. With a deed in lieu, the homeowner formally returns the property to the lender. If the lender accepts the property, no legal action takes place and your credit record is not damaged.
Non-Judicial: If your mortgage has a power of sale clause or if you are in a state in which a deed of trust is used instead of a mortgage, the lender has to right to foreclose on property without the approval of a court. As with judicial foreclosure, a formal notification is made, but the window of time before a property is sold may be shorter. This process presents an advantage to lender because it takes less time and money to foreclose on a property. The borrower has less time to resolve their debt and potentially keep their home.
Strict Foreclosure: Strict foreclosures are less common than judicial and non-judicial foreclosures. In a strict foreclosure, the lender seeks a court order to seize property from a homeowner. Once approved, the homeowner is given a set period of time to resolve the debt. If they are unable to do so, the property returns to the lender who is free to do with it as they choose. While it’s not much of an advantage for the homeowner, at least they have a designated time to pay their debt before losing their home.
Foreclosure is an emotional and financially difficult process to endure. The smartest choice you can make is finding a foreclosure lawyer that understands the process and can help you make sound choices for your future. The foreclosure attorneys at McIntyre Thanasides Bringgold Elliott Grimaldi & Guito, P.A. provide a wealth of experience and an ability to look at your individual situation, provide sound analysis and determine a proper solution. Contact them today at 844-511-4800.