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By Michelle Higgins
After renting a one-bedroom for seven years, Catherine and Peter Bertazzoni had saved enough for a down payment and were ready to buy their first apartment together. They knew it would be a challenge to find a move-in-ready two-bedroom on the Upper West Side within their $1.5 million budget, but with a baby on the way, they needed more space.
It wasn’t until they made their first offer, about $1.3 million for a two-bedroom one-bath listed for $1.25 million, that they realized just what they were up against.
“We came in at what we thought was significantly above ask and ended up sixth out of 11 bids,” said Mrs. Bertazzoni, 31, a tax manager at an asset management company. “It was a real wake-up call.”
Buying your first home in New York City is a daunting task. The median price for a Manhattan apartment recently reached nearly $1 million, with reports from major brokerage firms placing the price at $999,000 and $998,000, sums that would buy a mansion in many parts of the country. Competition is fierce, and bidding wars are practically the norm for anything that is halfway decent. Not to mention the level of scrutiny buyers must endure if they want to live in one of the city’s co-op apartments, which make up roughly 75 percent of Manhattan’s nonrental housing stock.
Mrs. Bertazzoni, along with her husband, Peter, 36, who also works in finance, visited nearly 40 apartments and lost two bidding wars during their intensive four-month search. “We learned quickly that there really are a lot of all-cash offers out there, and it made it important that we, as buyers who needed to finance, have our financials in order and be ready to move quickly,” she said.
In May they made an offer on a two-bedroom, two-bath listed for $1.395 million. When they closed in August, it was just in time. The paint had barely dried before their son, Oscar, came home from the hospital.
“It is extraordinarily challenging,” Mrs. Bertazzoni said of buying in New York. “You might not hit everything on your wish list, but in the end it can work out even for a first-timer.”
Here are some of the steps you need to take to buy an apartment in New York.
SAVE, SAVE, SAVE
Buyers should plan to put at least 20 percent down in order to be taken seriously. That’s right, for a $500,000 apartment, you’ll need a down payment of $100,000, and that does not include closing costs.
Be prepared for other charges large and small. Among the larger is the 1 percent surcharge on sales of $1 million or more in New York City, known as the mansion tax. Among the smaller incursions on your wallet: the co-op lien search fee (roughly $300), the board package fee ($500 to $2,000), the appraisal ($300 to $1,500), the condo municipal search ($350 to $500) and so on. Brokerage firms including Douglas Elliman and Town Residential offer a laundry list of estimated closing costs on their websites.
CLEAN UP YOUR CREDIT
Unless you are sitting on a substantial nest egg or are being financed by a benevolent relative, you will need a loan to afford your first place in New York City. Banks use credit scores, also known as FICO scores, to evaluate the potential risk of lending to individuals. The higher the number, which runs from 300 points to 850 points, the better your credit score.
Knowing your score well in advance will give you time to clean up any mistakes, like tax liens that were paid off many years ago or parking tickets that should have been expunged, said Peggy Dahan, an associate broker with Siderow Residential Group. “Sometimes it takes months to clear it up, and by then the seller has sold your dream apartment and we are back to Square One.”
Knowing your score will also give you time to boost your number by paying down credit card debt if your balances are on the high side. The three major credit-reporting bureaus, Equifax, Experian and TransUnion, generate their own FICO scores based on the data they collect. To find out where you stand, go to annualcreditreport.com, which offers a free report annually.
GET PREAPPROVED
Not to be confused with a prequalification, which is essentially a crude calculation of how much of a loan you might qualify for, a preapproval is a written estimate from the lender stating how much you will likely be able to borrow based on an initial review of your credit and financial information. The application often requires submitting pay stubs, bank statements, tax returns and other financial documents. Most lenders charge nothing for the application, since they are hoping to win your business, but you may be socked for around $100 to cover the cost of a credit check.
Why not wait until you’ve actually found a place to get a preapproval letter for a mortgage? Because it will help you determine how much you can afford. (You will also need it when you’re ready to submit an offer to provide assurance to the seller that you will be able to secure financing.) Preapproval letters typically expire between 90 and 120 days, but can be quickly updated with a phone call to the lender.
START SEARCHING
Once you have a sense of your budget, you can start searching for an apartment in earnest. Websites and apps from nytimes.com/realestate, StreetEasy and Trulia eliminate some of the work by automating the search. The sites will email you new listings that meet your requirements, save them and notify you when there are open houses or price changes. You can type in an address in StreetEasy to find out what else is for sale in a given building and how much apartments sold for previously.
CO-OP VS. CONDO
Apartments come mainly in two forms in New York City — co-op and condo. In a co-op, short for cooperative housing, you are buying shares in a corporation that will give you a proprietary lease in the building.
When you a buy a condo, you own the unit outright. In both cases, buyers will be asked to submit financial information including net worth, liquid assets, annual income and other financial documents. Co-ops tend to subject potential shareholders to more rigorous scrutiny, often requiring reams of personal as well as financial information.
“They’re going to undress you and you have to really reveal yourself,” is how Robert Dankner, the president of Prime Manhattan Residential, explains the excruciating process to first-time buyers. “It’s the price of entry and a rite of passage to buying in a co-op in Manhattan.” A co-op can turn down a sale for any reason it pleases as long as it does not discriminate illegally.
Co-op financial requirements can prove difficult for first-time buyers. Some co-ops don’t allow financing; others require buyers to show they have a year’s worth of mortgage and maintenance fees in the bank.
“Who can do that, really, as a normal person, while paying rent?” said George Sholley, a 29-year-old executive producer at a New York advertising agency. In the end, he opted for a condo.
“I had been trying to buy a place since 2012,” he said, noting that he was outbid three times by buyers with more cash on hand. Earlier this year, with the help of his agent, Scott Sobol, a salesman at Compass, Mr. Sholley bought a studio for $670,000 in a condominium conversion in Hell’s Kitchen. “It was a bit more expensive than I was hoping,” he said, but compared with the co-ops he had tried to buy, “it was a smoother process over all.”
HIT THE STREETS
It’s helpful to visit a range of open houses in order to narrow your preferences, including how far you really want to be from the subway when it snows, how out of breath you are on the third flight of a sixth-floor walk-up, and what is meant by loft, railroad flat, Junior Four and so forth. Neighbors may have information on individual buildings and neighborhood goings-on.
And open houses can also be a good way to meet real estate agents with whom you might consider working. If you like a particular building, a broker who does a lot of business there might be able to alert you to an apartment coming on the market. The doorman may be able to guide you to an agent in the know or to the soon-to-be-available apartment.
ASSEMBLE YOUR TEAM
Look for an agent and a real estate lawyer who have established track records working with buyers in your situation, and who will get back to you promptly.
“There’s not much of a barrier to entry to becoming a real estate agent,” said Jessica Cohen, an associate broker with Douglas Elliman who frequently works with entry-level buyers. “You want to feel like you’re working with someone who has done this countless times and isn’t learning the process on you while you’re on this emotional roller coaster.”
If you are gravitating toward co-ops, for instance, you want a broker who has put together many a co-op board package, and a lawyer who understands the accounting methods used by co-ops and can mine the minutes of its board meetings for red flags.
Ultimately you want an agent who can help you come up with a sound offer based on market analysis and who will put together a well-rounded application package on your behalf. “Your broker is there to market you,” Ms. Cohen said. “You have to sell yourself as a candidate to get the apartment. It’s almost ironic.”
Keep in mind that your agent’s commission, typically 5 or 6 percent split with the seller’s agent, will ultimately come out of the sale proceeds. Lawyer fees range from $1,500 to $5,000.
KILL YOUR DARLINGS
Know that during your search you will fall in love, have your heart broken and, if you are lucky, end up with the plain one with the nice personality, not the gorgeous but temperamental one.
Jacob Mondry, a 27-year-old musician, fell for the first place he saw when he started looking for a Brooklyn apartment last year.
“I was smitten,” he said, describing the exposed brick, tin ceilings and other charming details of a place in Gowanus. “I really thought I wanted this kind of romantic apartment.”
But the neighborhood lacked a residential ambience, and the attraction faded after his agent, Robert Dowling, an associate broker at Halstead Property, pointed out the additional investment that would be required to replace water-damaged floorboards and to make necessary updates. In hindsight, Mr. Mondry said, “I was happy to surrender that darling.”
Ultimately he bought a place in Park Slope, Brooklyn, a three-bedroom walk-up now shared with a roommate, for just under $1 million. While the apartment may not be as stunning as the first place he saw, “it’s quiet and charming and close to the park.”
BID EARLY, BUT NOT TOO EARLY
The amount of time that listings spent on the market in Manhattan fell 20 percent to a record low of 73 days in the third quarter of this year, according to a report prepared for Douglas Elliman by the appraiser Jonathan J. Miller.
Being the first to make a solid offer can give you a leg up.
For instance, if a subsequent offer comes in at a higher price, the seller may give you a chance to match it. But don’t bid before the first open house.
“Brokers will almost always let other agents and buyers know when they have offers in, and it will be a part of the agent’s pitch at an open house when speaking with prospective buyers,” said Ari Harkov, an associate real estate broker at Halstead.
With that in mind, Mr. Harkov recommends buyers wait until the Monday following the open house to submit their offers. “This can help keep the bidding process a bit calmer,” he said, as the listing agent won’t be able to flash your offer to every buyer who comes through the door at the open house.Set a price limit so you know when it’s time to walk away if a bidding war ensues.
BE THOROUGH
Prospective buyers can research the history of a property, including construction projects, violations and complaints with the New York City Department of Buildings website by plugging in the address. PropertyShark offers one free property report that pulls similar data and more from public records, including information on assessments, flood maps, crime statistics and the names of neighbors.
After the first free report, you can sign up for a monthly subscription ranging from $39.95 to $79.95 a month, depending on the number of reports and the kind of data requested.
It’s also important to scrutinize the building’s finances.
Shawn Cassidy, an area sales manager with Wells Fargo Home Mortgage in New York, points out that few banks are willing to lend if the management company still owns a majority of the apartments, as there is a risk that the sponsor could default. And it’s a good idea to hire a home inspector, especially if you are buying in a small building, where building maintenance and repair is the responsibility of a handful of owners.
“Let’s say there are three apartments in a townhouse. Each co-op shareholder would bear a third of the cost of addressing any issues,” said Aaron Shmulewitz, a real estate lawyer. “The potential economic risk is larger.”
After putting in more than a dozen offers on various apartments without success, Megan and Michael Bartolomeo were becoming desperate. So when their offer of $702,000 was accepted for a duplex basement apartment with a big backyard in South Park Slope, Brooklyn, they were ready to move in the next day.
“It was on the same street we lived on and had an awesome backyard,” said Mr. Bartolomeo, 34, a television editor. “We were like, ‘We love this place.’ ”
But for due diligence, they decided to pay $1,200 to hire an inspector who was recommended by their broker, Porter Hovey, a saleswoman at Halstead. “He came down,” Mr. Bartolomeo said, “took one look at the basement and said, ‘When was the flood?’ ”
It turned out that poor drainage was causing problems when it rained, and an incorrectly installed sewage pump seemed like a disaster waiting to happen, Mr. Bartolomeo said. “If we hadn’t used him, we wouldn’t have known.”
Shortly after, they made an offer of $729,000 on a two-bedroom walk-up in a prewar building nearby. They closed three months later.
BE PREPARED FOR DISAPPOINTMENT
Repeat: Heartbreak is part of the game.
“I tell my clients not to fall in love with a place,” said Bo Poulsen, a salesman at Town Residential. “It’s a heartbreaking experience when you go into a ‘best and final’ and you don’t get it. So you have to distance yourself from the property until the contract is signed.”
Keep in mind that even if the seller has verbally accepted your offer, sellers can still entertain and accept other offers. Even after the contract is signed, a co-op board could decide to turn down a sale.
For all these reasons, Victoria Hagman, the broker-owner of the Realty Collective in Brooklyn, always tells first-timers: “The buying process is a marathon, not a sprint.”
Copyright 2015 The New York Times Company. All rights reserved.
Here at Shenwick & Associates, the magic word for our debtor bankruptcy clients (we represent creditors, too) is "discharge." When a debt is discharged in bankruptcy, the debtor no longer has any personal liability for the debt and the creditor can no longer communicate with or take legal action against the debtor for the debt. This is the primary reason why debtors file for bankruptcy.
However, not all debts are dischargeable in bankruptcy. Section 523 of the Bankruptcy Code specifically lists many exceptions to discharge, including debts "obtained by–false pretenses, a false representation or actual fraud . . ." (§ 523(a)(2)(A)) and any debt "for willful and malicious injury by the debtor . . ." (§ 523(a)(6)).
This section of the Bankruptcy Code dates back to the Bankruptcy Reform Act of 1978, and since then, the federal courts have had to interpret the statute. For example, in Kawaauhau v. Geiger, the Supreme Court held that to be excepted from discharge under § 523(a)(6), an injury had to be deliberate or intentional.
In Husky Int'l Elec. v. Ritz, the Supreme Court will resolve a circuit split and determine whether the "actual fraud" bar to discharge under § 523(a)(2)(A) applies only when the debtor has made a false representation, or whether the bar also applies when the debtor has deliberately obtained money through a fraudulent transfer scheme that was actually intended to cheat a creditor.
In this case, appellant Husky sold and delivered electronic devices to Chrysalis Manufacturing Corp., an entity that was controlled by appellee Daniel Ritz. Chrysalis failed to pay Husky for any of the goods delivered, and incurred a debt of approximately $164,000. During this time, Ritz transferred much of Chrysalis' funds to various other entities that he also controlled. Husky sued Ritz in an attempt to hold him personally liable for Chrysalis' debt.
Ritz filed for personal bankruptcy, and Husky filed an adversary proceeding (bankruptcy litigation) seeking to except his debt to Husky from discharge, based on §§ 523(a)(2)(a) and 523(a)(6), as well as § 523(a)(4) (which excepts debts arising from fraud or defalcation in a fiduciary capacity, larceny and embezzlement). The bankruptcy court denied all of Husky's requested relief, and held that Husky had not established that Ritz had perpetuated an "actual fraud" on Husky, because Husky failed to show that Ritz made a false representation (one of the elements of an "actual fraud" under Texas law, which may be made by written or spoken words or by conduct) to Husky. The district court affirmed, and Husky appealed to the Fifth Circuit Court of Appeals.
The Court of Appeals reviewed the case law, including McClellan v. Cantrell, a Seventh Circuit Court of Appealscase that held that actual fraud under § 523(a)(2) is not limited to misrepresentations and misleading omissions. However, the Fifth Circuit relied on its own precedents (which held that representations were a required element of fraud and that exceptions to discharge were to be construed narrowly) to affirm the district court.
However, this past July in In re Lawson, the First Circuit Court of Appealscited McClellan in holding that "actual fraud" also includes debts incurred as a result of knowingly accepting a fraudulent conveyance that the transferee knew was intended to hinder the transferor's creditors.
Although these issues seem esoteric, they demonstrate the complex and fact intensive nature of bankruptcy law. In a recent case, we had to analyze wage claim actions against a food vendor as a possible exception to discharge. For your toughest bankruptcy questions, please contact Jim Shenwick.
Here we go again. Every twenty years this country suffers through a serious financial crisis, usually based around real estate lending. Why? Because of bad lending practices. Why are there bad lending practices? Because Congress keeps softening or eliminating mortgage lending regulations. Why does Congress do this, even when they know the consequences? Funding – big banks and lending institutions fund most of our politicians. Why do lending institutions want relaxed regulations? Because they can make more loans. Why do they want to make more loans? Because they are paid a huge commission from each loan. Why does the bank want huge commissions? Because it puts more money into the shareholders pockets and justifies huge bonuses to the upper management. So is this insanity ever going to stop?
Point in fact: In November, 2015 Rep. Andy Barr (R-Ky.) introduced The Portfolio Lending and Mortgage Access Act (H.R. 1210), which passed the House by a 255-174 vote. The bill is intended to give all banks and lending institutions the same exemption meant for small and rural banks to all banking institutions.
So what is the problem you ask? Perhaps a little history will help. The reason the real estate lending market collapsed was due to little or no regulations governing mortgages. In late 2011 the Consumer Financial Protection Bureau “CFPB” was established with the goals of putting some sanity into the lending market and to protect consumers from unscrupulous lenders. In 2013 and 2014 the CFPB issued regulations that, in order for a lender to obtain a qualified mortgage status, they were required to make certain a borrower has the ability to repay (what a novel concept). So what is benefit of a “qualified mortgage status“? The lenders who follow strict guidelines are provided “safe harbor” protection from federal penalties and lawsuits brought by borrowers who have defaulted on their loans. Except small and rural banks do not need to follow the ability-to-repay rule. H.R. 1210 would expand this limited exemption to all banking institutions. Hence, my statement about “here we go again”.
Proponents argue that the bill has a safety valve – if the lender makes a bad loan the lender must keep the loan and cannot sell it to the secondary market or securitize the loan. The message is that a lending institution has a right to make loans without concern over the borrower’s ability to repay, because that institution will be stuck with the loan forever.
What the proponents do not address is what happens when the insolvent lender closes their doors with hundreds or thousands of “bad loans”. Those loans will have to be absorbed by the lending market (aka Countrywide).
What is the real problem? CFPB is taking strides to control runaway creditors: banks, savings and loans, vehicle lenders, payday loan companies, plus many more. No one agency has done as much in a very limited time to speak for the consumer. Rep. Maxine Waters (Calif.), the top Democrat on the House Financial Services Committee, warns that “the bill undermines the anti-predatory lending provisions of the Dodd-Frank Act and virtually eliminates one of the most significant consumer protection rules implemented by the CFPB.”
The post Congress Deregulating Mortgage Lending – Will Lead to More Bad Loans appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.
Here we go again. Every twenty years this country suffers through a serious financial crisis, usually based around real estate lending. Why? Because of bad lending practices. Why are there bad lending practices? Because Congress keeps softening or eliminating mortgage lending regulations. Why does Congress do this, even when they know the consequences? Funding – big banks and lending institutions fund most of our politicians. Why do lending institutions want relaxed regulations? Because they can make more loans. Why do they want to make more loans? Because they are paid a huge commission from each loan. Why does the bank want huge commissions? Because it puts more money into the shareholders pockets and justifies huge bonuses to the upper management. So is this insanity ever going to stop?
Point in fact: In November, 2015 Rep. Andy Barr (R-Ky.) introduced The Portfolio Lending and Mortgage Access Act (H.R. 1210), which passed the House by a 255-174 vote. The bill is intended to give all banks and lending institutions the same exemption meant for small and rural banks to all banking institutions.
So what is the problem you ask? Perhaps a little history will help. The reason the real estate lending market collapsed was due to little or no regulations governing mortgages. In late 2011 the Consumer Financial Protection Bureau “CFPB” was established with the goals of putting some sanity into the lending market and to protect consumers from unscrupulous lenders. In 2013 and 2014 the CFPB issued regulations that, in order for a lender to obtain a qualified mortgage status, they were required to make certain a borrower has the ability to repay (what a novel concept). So what is benefit of a “qualified mortgage status“? The lenders who follow strict guidelines are provided “safe harbor” protection from federal penalties and lawsuits brought by borrowers who have defaulted on their loans. Except small and rural banks do not need to follow the ability-to-repay rule. H.R. 1210 would expand this limited exemption to all banking institutions. Hence, my statement about “here we go again”.
Proponents argue that the bill has a safety valve – if the lender makes a bad loan the lender must keep the loan and cannot sell it to the secondary market or securitize the loan. The message is that a lending institution has a right to make loans without concern over the borrower’s ability to repay, because that institution will be stuck with the loan forever.
What the proponents do not address is what happens when the insolvent lender closes their doors with hundreds or thousands of “bad loans”. Those loans will have to be absorbed by the lending market (aka Countrywide).
What is the real problem? CFPB is taking strides to control runaway creditors: banks, savings and loans, vehicle lenders, payday loan companies, plus many more. No one agency has done as much in a very limited time to speak for the consumer. Rep. Maxine Waters (Calif.), the top Democrat on the House Financial Services Committee, warns that “the bill undermines the anti-predatory lending provisions of the Dodd-Frank Act and virtually eliminates one of the most significant consumer protection rules implemented by the CFPB.”
The post Congress Deregulating Mortgage Lending – Will Lead to More Bad Loans appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.
Consumer Credit Counseling Services of Nebraska (CCCSN) closed its doors this year. The agency opened in 1976 and was viewed as the best organization to help debtors avoid bankruptcy by establishing repayment plans with creditors. The agency has been acquired by GreenPath Debt Solutions of Farmington Hills, Michigan, a large credit counseling agency with 60 offices in 13 states.
The closing represents a real loss to Nebraska residents. CCCSN offered face-to-face financial counseling, but that type of organization has become expensive to operate. Credit counseling agencies are largely funded by a fee called “Fair Share” in which the agency used to keep up to 15% of the funds being paid in credit card payment plans. However, in recent years banks have reduced that rate to 3 or 4 percent.
As the fair share rate has dropped, the industry has been forced to consolidate and larger credit counseling agencies with centralized computer and phone systems have gobbled up less efficient local agencies like CCCSN. Although GreenPath still maintains an office in Omaha and Lincoln, the agency does not even come close to matching the personal counseling services provided by CCCSN. Two or three GreenPath employees have replaced the large veteran staff CCCSN used to employ.
When the fair share rate was 15% the agency could afford to spend time in face-to-face meetings with clients. The agency was not limited to establishing Debt Management Plans (DMP) although that certainly was a core function. CCCSN helped many customers avoid bankruptcy by teaching them to establish workable budgets. Those days are gone. With lower fair share rates the only way to stay profitable is to enroll as many customers in a DMP as possible and then to farm out the work to a national organization. Personal counseling is basically a thing of the past. Veteran counselors are gone. Lower paid data input workers are now the norm.
The dramatic changes in the credit counseling industry have been documented by professors Robert Manning and Anita Butera in their report A Failing Grade For the Post-BAPCPA Credit Counseling and Bankruptcy Education Industry? Those changes include:
- A growing dependence on referrals from credit card collection departments.
- A reduction of Fair Share compensation rates from 15% to 3 or 4%.
- A growth of for-profit credit counseling companies disguised as nonprofit credit counselors that utilize a maze of related companies to siphon off revenue from their nonprofit sister companies.
- A consolidation of credit counseling agencies in favor of larger agencies that utilize economies of scale, large IT departments and DMPs that follow the strict guidelines established by the credit card industry.
- A reduction in face-to-face counseling.
- A movement towards DMP mills largely controlled by credit card collection departments though referral agreements best described as a Master-Slave relationship.
- A failure of the Internal Revenue Service to deny nonprofit status to agencies that are controlled by a single family that siphon off revenues to their for-profit entities.
My own observation is that clients can not distinguish the difference between traditional credit counseling agencies, DMP mills, debt settlement firms and other debt relief agencies all claiming to be nonprofit agencies. Debtors cannot distinguish the true nonprofits from the profit-maximizing wolves in sheep clothing nonprofits. As a consequence, the older community-based credit counseling agencies are dying nationwide.
Goodbye CCCSN. We hate to see you go.
Image courtesy of Flickr and Sean MacEntee
As part of a modernization effort that began in 2008 that is being spearheaded by the Advisory Committee on Bankruptcy Rules, most official bankruptcy forms are being replaced with revised, reformatted and renumbered versions, effective December 1, 2015. Read More ›
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When people come into my office one of the first things they ask me is often “how will this affect my credit?” The answer is complicated. Some of my clients come to me having never missed a payment in their life. Their mortgage, their car payment, and their credit cards are all current. Typically these individuals have been doing everything possible to maintain their payments, including using one credit card to pay the minimum payment on another. For these individuals maintaining their good credit score, despite the hard times they were enduring, is part of their identity. Unfortunately, for these individuals a bankruptcy filing will have the most dramatic affect on their credit score. However, many other individuals come to me years after first experience financial hardship. Long before stepping into my office they have been forced to default on credit cards or give a car back to the bank in order to have enough money to put food on their table. For these individuals a bankruptcy filing will have little affect on their already low credit score.
A bankruptcy filing remains on your credit report for up to ten years. However, its affects on your credit score are most dramatic immediately after filing. Their is no need to wait ten years to rebuild your credit score. Below are some positive steps that you can take to rebuild your FICO score in just a few short years:
1) Obtain credit: It is important that you have a payment history if you want to rebuild your credit. Your payment history comprises up to 1/3 of your credit score and the lack of a payment history can be as damning as a bad one. By cautiously obtaining a few small credit lines you will be able to re-establish a payment history.
2) Don’t pay late: As stated above, your payment history is a large part of your credit score. If you pay late on your bills your score will be impacted in a dramatic manner. You may want to consider putting due dates on your calendar or setting up your bills for automatic payments.
3) Know your credit limits: Many lenders look to your your debt to credit ratio when processing your loan application. It is assumed that individuals whose balances are low compared to their available credit are more able to repay these debts. Try and keep your debt to about one third of your available credit.
4) Keep lines of credit open. Even if you don’t use a credit card, the available balance is taken into account in determining your debt to credit ratio. Keeping these accounts open is a good way to rebuild your credit score. However, it is important to continue to monitor these accounts to be sure that the accounts remain secure.
5) Work with creditors who positively report. Their are three types of creditors. First their are creditors who do not report at all. These are typically businesses that work on an upfront cash basis. Certain cell phone companies, for instance, require you to pay each month up front. Failure to pay results in your phone being turned off, but you have no liability for any unpaid balance. These creditors do not report positively or negatively on your credit report. Second their are creditors who only report when you have been bad. While you pay on time every month, they do not report anything to the credit bureaus. However, the minute that you miss a payment they file a report, harming your credit. Finally we have creditors who positively report. These creditors tell the agencies what you have done each month. Each time they report that you have paid on time your credit score improves. It is important to talk to all creditors (credit card companies, landlords, cell phone companies, auto-loans, etc.) to be sure that they positively report.
6) Review your credit report regularly. In order to ensure that your credit score heads in the right direction it is imperative that the information on the report is accurate. Each year you are entitled to receive a free copy of your credit report from each of the credit reporting agencies. Be sure to take advantage of this opportunity to review your credit status and report any errors. Take this time to review your credit repair plan and make any adjustments based on your credit reports.
If you are considering bankruptcy you should contact an experienced attorney to help guide you through the bankruptcy and rebuilding process. Second Chance Legal Services would love to help. Call (586) 806-2701 today to schedule your free consultation.
You can stop your mortgage foreclosure by filing a chapter 13 bankruptcy under most circumstances. Chapter 13 will give you an opportunity to apply for a mortgage modification while under the protection of the Bankruptcy Court.
A chapter 13 bankruptcy must be filed before the foreclosure sale takes place if desire to save your real property. Under chapter 13 you are required to present a plan of reorganization.
Mortgage Modification
In Chapter 13 you are able to use the Bankruptcy Court's new "LMM" program - Loss Mitigation Mediation. You and the mortgage company are able to communicate over a special internet portal so documents do not get lost.
Wipe Out "Under-Water" Second Mortgages
Under chapter 13 bankruptcy, you can avoid or wipe-out your second mortgage if it is wholly "under-water." Jordan E. Bublick - Miami Bankruptcy Lawyer - Kendall & Aventura Offices - (305) 891-4055 - www.bublicklaw.com
You can stop your mortgage foreclosure by filing a chapter 13 bankruptcy under most circumstances. Chapter 13 will give you an opportunity to apply for a mortgage modification while under the protection of the Bankruptcy Court.
A chapter 13 bankruptcy must be filed before the foreclosure sale takes place if desire to save your real property. Under chapter 13 you are required to present a plan of reorganization.
Mortgage Modification
In Chapter 13 you are able to use the Bankruptcy Court's new "LMM" program - Loss Mitigation Mediation. You and the mortgage company are able to communicate over a special internet portal so documents do not get lost.
Wipe Out "Under-Water" Second Mortgages
Under chapter 13 bankruptcy, you can avoid or wipe-out your second mortgage if it is wholly "under-water." Jordan E. Bublick - Miami Bankruptcy Lawyer - North Miami & Kendall Offices - (305) 891-4055 - www.bublicklaw.com
You can stop your mortgage foreclosure by filing a chapter 13 bankruptcy under most circumstances. Chapter 13 will give you an opportunity to apply for a mortgage modification while under the protection of the Bankruptcy Court.
A chapter 13 bankruptcy must be filed before the foreclosure sale takes place if desire to save your real property. Under chapter 13 you are required to present a plan of reorganization.
Mortgage Modification
In Chapter 13 you are able to use the Bankruptcy Court's new "LMM" program - Loss Mitigation Mediation. You and the mortgage company are able to communicate over a special internet portal so documents do not get lost.
Wipe Out "Under-Water" Second Mortgages
Under chapter 13 bankruptcy, you can avoid or wipe-out your second mortgage if it is wholly "under-water." Jordan E. Bublick - Miami Bankruptcy Lawyer - North Miami & Kendall Offices - (305) 891-4055 - www.bublicklaw.com
Updated daily, this blog will keep you informed on the latest bankruptcy news! 
Learn more about how Bankruptcy works and what you need to know.