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1 year 3 months ago

According to a report from the Consumer Financial Protection Bureau ‘CFBP’ Experian is fined $3 Million for Deceiving Consumers

Experian Deceives ConsumersWashington, D.C. – The Consumer Financial Protection Bureau (CFPB) today took action against Experian and its subsidiaries for deceiving consumers about the use of credit scores it sold to consumers. Experian claimed the credit scores it marketed and provided to consumers were used by lenders to make credit decisions. In fact, lenders did not use Experian’s scores to make those decisions. The CFPB ordered Experian to truthfully represent how its credit scores are used. Experian must also pay a civil penalty of $3 million. 
“Experian deceived consumers over how the credit scores it marketed and sold were used by lenders,” said CFPB Director Richard Cordray. “Consumers deserve and should expect honest and accurate information about their credit scores, which are central to their financial lives.” 

So what is the CFPB going to require from Experian?
Under the consent order, Experian must:

  • Pay a $3 million penalty: Experian must pay a civil money penalty of $3 million to the Bureau’s Civil Penalty Fund.
  • Truthfully represent the usefulness of credit scores it sells: Experian must inform consumers about the nature of the scores it sells to consumers.
  • Put in place an effective compliance management system: Experian must develop and implement a plan to make sure its advertising practices relating to credit scores and on Internet webpages that consumers access through AnnualCreditReport.com comply with federal consumer laws and the terms of the CFPB’s consent order. 

The CFPB’s Consent Order against Experian:

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About the Author:
Diane L. DrainDiane L. Drain is a well known and respected Arizona bankruptcy attorney. She is an expert in both consumer bankruptcy and Arizona foreclosure. Since 1985 she has been a dedicated advocate for her clients and spokesperson for Arizona citizens. Diane is a retired professor of law teaching bankruptcy for more than 20 years. As a teacher she believes in offering everyone, not just her clients, advice about the Arizona bankruptcy laws. She is also a mentor to hundreds of Arizona attorneys.
I would be flattered if you connected with me on GOOGLE+
*From Diane: This article/blog is available for educational purposes only and does not provide specific legal advice. By using this information, you agree there is no attorney client relationship between you and me, and that this information should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state.*

The post Experian Fined $3 Million for Deceiving Consumers appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.


1 year 5 months ago

Bankruptcy filing – or the prospect of it – usually puts Wynn at Law LLC clients in full-out panic mode. One of the most alarming, last-ditch, hail-Mary ideas coming from this desperation is to cash out a retirement plan to avoid bankruptcy court. In some cases, people can ‘borrow’ against their company retirement plan, usually a 401(k). This is as dangerous as cashing out to cover the financial struggle.
Don’t. Touch. This. Money.
Retirement money is tax-exempt until you touch it. If you touch it too early, you’ll be subject to taxes and penalties. Here’s a primer on a few of those consequences:

  • If you put the money in after paying taxes on it – like in a Roth IRA – you’ll pay tax on the earnings and a 10 percent penalty if the IRA is less than five years old and the owner is younger than age 59 ½.
  • If you put the money in tax free – like in a regular IRA or a 401(k) – the entire distribution is subject to income tax at your current rate, plus the 10 percent IRS penalty if the owner is younger than age 59 ½.

A tax specialist or accountant will give you clearer instruction on your particular situation’s consequences. Wynn at Law LLC is concerned about those immediate consequences, and the long-term ones. It’s your retirement income you’re putting in jeopardy. You’re mortgaging your entire future! If you leverage this nest egg to avoid bankruptcy filing today, you may have just kicked the can down the road, facing potential bankruptcy in your retirement years.
In almost every case, your qualified retirement plan is EXEMPT from your bankruptcy filing anyway. You get to keep the plan, your creditors don’t. But this goes back to a message from an earlier Wynn at Law LLC article on honesty: You have to disclose that your own a retirement account. It’s still going to be your retirement nest egg, they can’t touch it, but you can’t hide it.
*The content and material in this original post is for informational purposes only and does not constitute legal advice.
Photo by Syda Productions, Lev Dolgachov, used with permission.
The post Don’t cash out your IRA to avoid bankruptcy appeared first on Wynn at Law, LLC.



1 year 3 months ago

Subprime vehicle loans – according to an article in Automotive News and Bloomberg “about a third of the risky car loans that are bundled into bonds are considered “deep subprime,” a level that has surged since 2010 and is translating to higher delinquencies on the loans, according to Morgan Stanley.”
subprime auto loansAutomotive financing is following the wise (that is intended to be sarcastic) decisions made in the mortgage lending market.  Surprise –  Morgan Stanley’s Vishwanath Tirupattur, James Egan and Jeen Ng said in a report dated March 24 that “consumers are falling behind on most subprime car loans, but deep subprime borrowers have deteriorated fastest.”  The subprime loans are sold on the high-risk lending market in a method referred to as “securitization”.  Which means loans that are high risk are bundled together and sold to investors (like your retirement loan portfolio).
So who is obtaining these “subprime” auto loans?  Usually this is a borrower who has a credit score below 600.  Folks in this group are considered high credit risks.
Bank/Investors willing to take high risks

As Wall Street banks have found it tougher to profit under new regulatory regimes born out of the last subprime crisis, they’ve become more willing to underwrite riskier auto-loan asset-backed security sales. Investors, starved for returns with about $8 trillion of debt globally carrying negative yields, have in turn proven to be insatiable, further facilitating higher levels of risk in the market for the securities.

Losses increasing higher than expected

“Many companies are increasing their loan loss provisions, which has caused some formerly profitable companies to become unprofitable. Other newly formed companies are still striving to break even,” analysts at S&P including Amy Martin said in a March 20 report.

Is this similar to a pyramid scheme?

junk vehicle loansThe foundation for the loan (value of the vehicle) is a very poor investment, but initial investors may see a significant return on their investment, but as time passes those who buy this junk paper will find their investment lost because it never really existed.

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About the Author:
Diane Drain
Diane L. Drain is a well known and respected Arizona bankruptcy attorney. She is an expert in both consumer bankruptcy and real estate laws. Since 1985 she has been a dedicated advocate for her clients and spokesperson for Arizona citizens. Diane is a professor of law and has taught bankruptcy for more than 20 years. As a teacher she believes in offering everyone, not just her clients, advice about the Arizona bankruptcy laws. She is also a mentor to hundreds of Arizona attorneys.Read More →
Connect with Diane on google+ *This article is available for educational purposes only and does not provide specific legal advice. By using this information, you understand that there is no attorney client relationship between you and me, and that this information should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state.*

The post Subprime Vehicle Loans are Skyrocketing appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.


1 year 5 months ago

Robert Weed has the best rate of bankruptcy dismissed in Northern Virginia Just finished checking on the number of my law firm bankruptcy cases dismissed the first three months of this year. (“Dismissed” means thrown out; the opposite is “discharged” which means successfully completed.)   We had 4 dismissals and 90 cases filed—that’s 4.4%. One […]The post Lowest rate of bankruptcy dismissed in Northern Virginia by Robert Weed appeared first on Robert Weed.


9 months 3 weeks ago

Robert Weed has the best rate of bankruptcy dismissed in Northern Virginia Just finished checking on the number of my law firm bankruptcy cases dismissed the first three months of this year. (“Dismissed” means thrown out; the opposite is “discharged” which means successfully completed.)   We had 4 dismissals and 90 cases filed—that’s 4.4%. One […]


9 months 3 weeks ago

Robert Weed has the best rate of bankruptcy dismissed in Northern Virginia Just finished checking on the number of my law firm bankruptcy cases dismissed the first three months of this year. (“Dismissed” means thrown out; the opposite is “discharged” which means successfully completed.)   We had 4 dismissals and 90 cases filed—that’s 4.4%. One […]
The post Lowest rate of bankruptcy dismissed in Northern Virginia by Robert Weed appeared first on Robert Weed.


1 year 3 months ago

Credit Reports to Exclude Certain Negative Information, Boosting FICO Credit Scores,
by AnnaMaria Andriotis at The Wall Street Journal
credit scoreAs a result of increasing pressure from Consumer Financial Protection Bureau and other regulatory concerns, the three major credit-reporting agencies are changing their standards for two pieces of negative information: tax liens and civil judgments.  The promise is that sometime around summer of 2017 Equifax, Experian, and TransUnion will remove those data points from reports if they don’t include a person’s name, address, and either a Social Security number or date of birth. “Many liens and most judgments don’t include all three or four.”
It is expected that about 12 million people will see a slight increase to their credit score, typically of less than 20 points, but 700,000 people will get a rise of at least 40 points. “In many cases, that can mean the difference between getting approved for credit or denied it.”
LexisNexis estimated that 96% of public-record information about tax liens and 50% of information about civil judgments cannot be verified. LexisNexis Risk Solutions pulls tax lien and civil judgment information from the courts and the U.S. Internal Revenue Service and feeds it to the three credit bureaus. It also provides the same type of data directly to lenders.
“The three main credit-reporting firms jointly decided to make the changes. They did so as regulatory pressure has intensified in recent years around credit reports and the outsize role they typically play in lending decisions.”

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1 year 5 months ago

Last year, California-based clothing retailer Pacific Sunwear, better known by its shortened name PacSun, drastically reduced its debt from $88 million to just $30 million by giving stock to senior lender Golden Gate Capital as part of a Chapter 11 reorganization plan: a debt reduction of $58 million. Retail analyst Poonam Goyal was quoted in Bloomberg Markets as calling PacSun’s story “every distressed retailer’s dream.” If your business is undergoing financial hardship – or if you are a California resident whose debt exceeds the limits permitted for Chapter 13 – Chapter 11 may be able to help you substantially reduce the amount you owe various creditors while keeping your company afloat. Our Roseville Chapter 11 attorneys discuss who can file for Chapter 11 in California, how Chapter 11 works, and when it might make sense for an individual to file under Chapter 11.

chapter 11 attorney folsom
Who Can File for Chapter 11 in California?
Chapter 11 is sometimes overlooked as a bankruptcy filing option among Californians, not only due to the complexity of the process, but also the rarity with which it is used compared to other chapters of bankruptcy. Among the 20,379 total bankruptcy filings in the U.S. Bankruptcy Court for the Eastern District of California during 2014, the vast majority involved Chapter 7 (16,652 total) or Chapter 13 (3,628 total), compared to just 84 Chapter 11 cases filed during the same time period. Phrased another way, Chapter 7 accounted for about 82% of the cases filed in 2014, while Chapter 13 accounted for 18%, and Chapter 11 accounted for less than 0.5%.
Chapter 11 is normally utilized by businesses, though in rare circumstances individuals may file under Chapter 11 as well. While most individual debtors are better served by Chapter 7 or Chapter 13, Chapter 11 may be appropriate for an individual filer if he or she has too much disposable income to file under Chapter 7, which is decided by a process called “means testing,” and has too much debt to file under Chapter 13. As of April 2016, under federal law an individual cannot file for Chapter 13 if his or her unsecured debts exceed $394,725, or if his or her secured debts exceed $1,184,200. These figures are periodically adjusted to account for inflation.
Chapter 11 is frequently utilized by business entities because they are prohibited from filing under Chapter 13, while filing under Chapter 7, which is permitted, will result in liquidation of the company’s assets. If a corporation, partnership, or limited liability company (LLC) wishes to avoid closure and remain operating throughout the bankruptcy, it is generally necessary to file under Chapter 11. Bankruptcy regulations are federal, meaning these rules apply not only to individuals and businesses in California, but throughout the United States.
chapter 11 attorneys in sacramento
What Happens to Debt in Chapter 11?
PacSun’s debt reduction was impressive, but pales in comparison to the Chapter 11 plan for oil and gas company Penn Virginia Corporation announced in mid-2016. According to a report in Law360, “Penn Virginia said that it has entered into a restructuring support agreement with creditors that hold approximately 87% of its funded debt obligations, about $1.03 billion.” While few filers are dealing with that level of debt, Chapter 11 can nonetheless result in substantial reductions to the amount the debtor owes.
Similar to Chapter 13, Chapter 11 is a reorganization bankruptcy in which the filer’s debts are restructured in accordance with a plan of reorganization. After the plan of reorganization is confirmed, most of the filer’s debts will be discharged. However, if the filer is an individual, no discharge will be granted until the debtor has made all payments provided for in the plan. The plan will not be confirmed by the bankruptcy court unless it is fair, feasible, and serves the best interests of the creditors involved.
Unlike a Chapter 13 or Chapter 7 bankruptcy, it is relatively uncommon for California bankruptcy courts to appoint a trustee to administer a Chapter 11 plan. In many though not all Chapter 11 cases, the debtor, who is called the “debtor in possession,” continues to run the business. However, the bankruptcy court will have discretion over any major decisions regarding the business, such as signing a lease, entering an agreement with a vendor, or expanding the business by opening more locations. A Chapter 11 case may conclude in as little as several months, but more typically takes several years to resolve.
Roseville Business Bankruptcy Lawyers Serving Sacramento and Folsom
Serving Roseville, Folsom, and Sacramento, the attorneys of The Bankruptcy Group have years of experience assisting businesses, individual filers, and married couples filing jointly for bankruptcy in California. Whether you are a small business owner thinking about Chapter 11 in Sacramento, a sole proprietor considering Chapter 13 In Folsom, or an individual who wishes to file under Chapter 7 in Roseville, our knowledgeable bankruptcy lawyers can help guide you through the process to maximize the efficiency of proceedings while protecting your interests and advising you of your options and their potential effects.
To speak confidentially in a free legal consultation with our Roseville Chapter 13 lawyers, Roseville Chapter 11 lawyers, or Roseville Chapter 7 lawyers, contact The Bankruptcy Group at (800) 920-5351 today.
The post Can Chapter 11 Reduce or Eliminate Debt for Businesses in California? appeared first on The Bankruptcy Group, P.C..


1 year 5 months ago

The Bankruptcy Code puts specific demands upon the debtor seeking to eliminate debt through a bankruptcy filing. It is important for clients to realize that these demands are inherent in the bankruptcy code and are not needless demands from their bankruptcy attorney. In many cases, debtors will wrongfully assume that the demand is coming from+ Read More
The post Requesting Documents Required For Filing Bankruptcy The Right Way appeared first on David M. Siegel.


1 year 5 months ago

In February, the FBI reported pastor Karl Robinson was sentenced to four years in federal prison for his role in a mortgage rescue scam that falsely promised California homeowners they could stop foreclosure and stay in their houses by paying fees for “experienced consultants.” Unfortunately for the victims of Robinson’s scam, his financial promises were too good to be true, and their money was wasted on useless, fraudulent services. However, there is a way to stop foreclosure that doesn’t involve empty promises or criminal activity: filing for Chapter 13 bankruptcy in California. Our Roseville Chapter 13 attorneys explain how filing under this chapter enables debtors in California to keep, and remain in, their homes.

foreclosure chapter 13 bankruptcy CA
Can You Keep Your House in a Chapter 13 Bankruptcy in CA?
The short answer to this question is yes: under the right circumstances, filing for Chapter 13 with strategic timing will allow the filer to retain his or her property and avoid being foreclosed on. The long answer, of course, is more detailed.
There are numerous chapters (types) of bankruptcy, but most Californians end up filing under Chapter 7, which involves liquidation of assets, or Chapter 13, which instead focuses on reorganization or creditor repayment. It is critical to emphasize that filing for Chapter 7 bankruptcy will not prevent foreclosure from occurring.
While a feature of Chapter 7 known as the “automatic stay” can postpone foreclosure, the proceedings will continue once the case is over. Moreover, there are circumstances under which a lender could conceivably persuade the bankruptcy court to lift the automatic stay, thus depriving the debtor of its protection. While Chapter 7 bankruptcy can be immensely beneficial for the right filer in that numerous debts are discharged after a short time period, it is generally not the ideal approach for homeowners concerned about foreclosure. An experienced Roseville Chapter 7 lawyer can help you understand how you would be affected by filing under various chapters, and which type of bankruptcy is right for your situation.
The only way to save your home from foreclosure through bankruptcy is by filing under Chapter 13. If you are a resident of Roseville, Folsom, or Sacramento, you will generally file your Chapter 13 petition with the Sacramento Division of the United States Bankruptcy Court for the Eastern District of California, which is located in the Robert T. Matsui United States Courthouse in downtown Sacramento, for a filing fee of $310 (which includes a $235 filing fee in addition to an administrative fee of $75).
But why does Chapter 13 stop foreclosure, while Chapter 7 doesn’t? The answer lies with the process involved in each type of bankruptcy.
When you file for Chapter 7 in California, most of your debts, including medical debt, credit card debt, and various debts arising from personal loans, can be quickly discharged provided you abide by all bankruptcy regulations and the rules of the bankruptcy court. This means you are no longer responsible for paying the discharged debts. However, a court official called a “trustee” will sell some of your property, excluding property you’ve protected using System 1 or System 2 of California’s bankruptcy exemptions. That doesn’t necessarily mean the trustee will sell your house, particularly if you have no equity; but keep in mind that, once the bankruptcy is over, the lender will still have a lien on your home, even though your liability for the mortgage has been eliminated. That means the lender can still foreclose on your home, despite the discharge you received from the bankruptcy court.
Chapter 13 works differently, and therefore, has a different impact on foreclosure proceedings. When a debtor declares Chapter 13 in California, he or she is required to propose a long-term reorganization plan, which essentially establishes a three- to five-year course of monthly payments that the filer will make toward his or her creditors, starting with secured creditors.
Significantly, you can catch up on mortgage arrears (also called “arrearages”) by making payments as part of your Chapter 13 plan. In other words, Chapter 13 gives the filer anywhere from three to five years, depending on his or her financial circumstances, to catch up on his or her missed mortgage payments. If you can remain current on your mortgage payments going forward, and make up for the payments you have missed, you can save your home from being foreclosed upon.
folsom bankruptcy chapter 13
Contact Our Roseville Bankruptcy Lawyers About Stopping Foreclosure
If you’re a homeowner in Sacramento, Roseville, Folsom, or the surrounding communities, and you’re worried about losing your home to foreclosure, Chapter 13 bankruptcy may be able to help you stay in your house and keep your property. However, it is vital to act swiftly. The longer you wait to speak with an attorney about how to stop foreclosure in Roseville, the fewer legal options will remain open to you. To discuss Chapter 13 or Chapter 7 bankruptcy in a free and completely confidential legal consultation, contact The Bankruptcy Group at (800) 920-5351 today.
The post Can You Stop Foreclosure in Chapter 13 in California? appeared first on The Bankruptcy Group, P.C..


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