November 28, 2023
Knowing the key differences between bankruptcy vs. debt consolidation is crucial for those facing financial challenges. The legal process, impact on credit, and financial obligations vary significantly between the two. Understanding the differences helps individuals make informed decisions based on their financial situations and goals, determining which option aligns better with their needs and situation.
Before filing for bankruptcy, individuals must typically undergo credit counseling. Next, a detailed petition with the bankruptcy court must be filed, followed by court proceedings. On the other hand, debt consolidation primarily involves financial agreements and commitments rather than stringent legal procedures. It focuses on restructuring existing debts to simplify repayment.
Impact on Credit
Bankruptcy has a significant impact on credit scores. It usually stays on credit reports for around seven to ten years for Chapter 7 and three to seven years for Chapter 13. Debt consolidation could briefly lower credit scores because of the new loan inquiry or signing up for the consolidation program. Yet, debt consolidation can gradually improve credit standing over time when handled responsibly with consistent repayment.
During bankruptcy, particularly under Chapter 7, some assets are liquidated. This process involves a court-appointed trustee’s sale of non-exempt assets to generate funds to repay creditors. The goal is to distribute the proceeds among creditors. Conversely, debt consolidation doesn’t entail asset sales. Instead, it focuses on streamlining debt management by restructuring payments or acquiring a new loan to settle existing debts.
In summary, bankruptcy is usually the best option when debt becomes too overwhelming and cannot be paid even when the debt is restructured. On the other hand, debt consolidation is typically the best option for individuals with manageable debt who require a more structured repayment plan.
The Law Offices of Ronald I. Chorches understands the complexities of financial struggles and the weight of debt-related decisions. Whether you’re contemplating bankruptcy or debt consolidation, our experts offer comprehensive consultations to navigate your options. We believe in empowering our clients with the knowledge and understanding necessary to make informed choices. Contact us today for a personalized consultation tailored to your specific circumstances.
September 13, 2023
Foreclosure is the legal process by which a mortgage lender takes possession of a property when a homeowner fails to make their mortgage payments. The lender typically uses it as a remedy to recover the money owed on the mortgage loan when the borrower defaults on their payments. Unfortunately, foreclosure is rising in many US cities, including New Haven, Connecticut.
Foreclosure on the Rise
Connecticut, like many other states, implemented measures to protect homeowners from foreclosure during the COVID-19 pandemic. After the moratorium on foreclosures was lifted, there was an influx of foreclosure filings. The uptick was caused by mortgage lenders catching up to homeowners who fell behind on their payments. Moreover, since then, the cost of living has continued to climb. The effects of inflation on daily expenses, such as food costs, have made money tight for many New Haven, CT families. Consequently, some have struggled to pay the mortgage.
There has also been a significant upswing in home values throughout Connecticut, which is generally seen as a positive trend for homeowners. However, for some individuals, the challenge lies in managing their heightened property tax assessments. According to ATTOM, Connecticut has some of the nation’s highest effective property tax rates at 1.57 percent, just behind New Jersey and Illinois.
During financial difficulties, it’s essential to make contact with the mortgage lender. Homeowners should proactively communicate with their lenders when they encounter financial problems to explore options for avoiding foreclosure. Early communication and cooperation are key factors in finding a solution that benefits both the homeowner and the lender. While a lender may not be inclined to modify monthly payments, they can provide assistance and alternatives to aid a borrower with getting up to date on mortgage payments.
Lawyers can also play a crucial role in helping individuals facing foreclosure by providing legal advice, representation, and assistance. Attorneys can negotiate with mortgage lenders on behalf of homeowners to investigate alternatives for preventing foreclosure—for example, loan modifications, forbearance agreements, or customized repayment plans. Lawyers frequently utilize their legal expertise and adept negotiation abilities to attain more advantageous terms on behalf of their clients.
The possibility of losing a home can be challenging to come to terms with. For some, there may be plausible options for preventing the foreclosure process. A Connecticut foreclosure lawyer from The Law Offices of Ronald l. Chorches will help. Schedule your consultation today.
June 8, 2023
Federal student loans are loans the U.S. Department of Education provides to help students pay for higher education. The loans are available to eligible students enrolled in an accredited university or college. According to data from The National Center for Education Statistics, of individuals who obtained a bachelor’s degree in 2016, the average remaining balance of their federal student loans was 92 percent one year after graduation. Indeed, it is common for many to take a decade or longer to pay off their student loans.
In some cases, student debt holds debtors back from being able to move forward financially. In the worst-case student debt scenarios, these loans create tremendous financial hardship. However, there is relief available from this hardship. Federal student loan debt is not guaranteed to be discharged by the court when an individual declares bankruptcy. Nonetheless, it is possible, but it takes specific extra steps.
One must start a second bankruptcy process known as a student loan adversary proceeding to have student debt discharged in bankruptcy. Specifically, a student loan adversary proceeding is a lawsuit initiated by a borrower who aims to eliminate their debt due to the significant undue hardship it imposes on them. The majority of courts in the United States have adopted the Brunner test. The test is a standard that requires debtors to prove undue hardship. For example, the borrower must show that they’ve made efforts to pay the loan but cannot maintain a minimal standard of living by doing so. Furthermore, they must show the court that their financial situation is not expected to improve.
There is a commonly believed myth that student loan debts can never be discharged in bankruptcy. For this reason, most individuals declaring bankruptcy do not initiate the next step of an adversary proceeding. They never get the chance to prove that their student loans are causing undue hardship. Only a small percentage of student loan borrowers attempt to discharge their debt. However, 4 out of 10 individuals who do take the next step end up having their student loans discharged.
If you carry student loans that add to the financial hardship in your life, it is worth taking the extra step of an adversary proceeding. Our expert attorneys can provide you with guidance every step of the way and ensure you have the best chance of full discharge, default judgment, or settlement. Contact us today to learn more.
May 6, 2023
Foreclosure is the legal process that ensues when a borrower fails to make timely payments on a home loan, and the lender takes possession of the house as collateral. The lender generally gives the borrower a specific timeframe to bring their loan up-to-date and prevent foreclosure. Suppose a foreclosure sale has not yet occurred. If a debtor files for bankruptcy, they can promptly halt the foreclosure unless they have filed for bankruptcy within the last year. Bankruptcy can help save property from foreclosure by preventing lenders from taking immediate action to give the debtor time to find solutions. Here’s how various forms of bankruptcy can help:
Chapter 7 Bankruptcy
Chapter 7 bankruptcy triggers an automatic stay that halts creditors from taking action, including lenders foreclosing on a property. By activating an automatic stay to stop creditors, the borrower can catch up on missed payments and avoid foreclosure. However, in many cases, the lender will quickly file a motion for relief from the automatic stay to seek permission from the bankruptcy court to move forward with the foreclosure. For this reason, filing for Chapter 7 bankruptcy will only briefly pause the foreclosure process.
While it’s essential to note that Chapter 7 bankruptcy does not provide a long-term foreclosure solution, this type of bankruptcy can help save a property from foreclosure because it buys the borrower time to pay missed mortgage payments, seek refinancing, or look into loan modification to keep the home. If the borrower cannot catch up on missed payments or make current payments, the lender will resume foreclosure proceedings once the automatic stay is lifted.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy, also called reorganization bankruptcy, enables the borrower to retain their property by settling their debts over three to five years. The debtor will make monthly payments to a bankruptcy trustee whose job is to make payments to creditors, including missed mortgage payments. During this time, the debtor will still be making monthly mortgage payments. If the debtor makes all payments on time and according to plan, the property will not face foreclosure.
Please note that the debtor must possess a stable income to be eligible for Chapter 13 bankruptcy. They must be able to fulfill the monthly payments as per the repayment plan terms. Therefore, Chapter 13 bankruptcy is typically advised for individuals who still have a job but find it challenging to keep up with the debt they owe. This form of bankruptcy is helpful when facing foreclosure because it allows debtors to reorganize their secured debts, such as mortgages, while keeping the asset, such as the house.
Foreclosure Mediation Programs
Connecticut offers Foreclosure Mediation Programs that should be explored when homeowners file for bankruptcy. These programs aim to negotiate new mortgage terms between homeowners and lenders that are more manageable. A neutral third-party mediator facilitates communication between the two and finds a solution acceptable to both parties. The mortgage lender may agree to extend the loan term, reduce the interest rate, or even forgive a percentage of the outstanding principal. These programs are beneficial for those who have experienced financial hardship, such as job loss.
Facing foreclosure is hugely stressful. Please know there is hope. There are many options to investigate before giving up. We can help you explore ways to save your home based on your financial situation. Contact us today to learn more about how we can help you.
March 29, 2023
With tax season comes an upswing of bankruptcies. This upward trend may be because federal or state taxes owed, on top of other extensive debt, have become too much for many individuals. Or perhaps the reasoning behind this upswing is that tax season forces many people to look more closely at their financial situation. This closer look may make the decision to file for bankruptcy more prominent during this part of the year. No matter what the case is, filing for bankruptcy is complicated, and navigating taxes during this sensitive time adds a layer of complexity.
How Bankruptcy Impacts Paying Back Taxes
Filing bankruptcy is a potential option to have past-due federal taxes eliminated. However, bankruptcy does not terminate fraud penalties or payroll taxes. Furthermore, the tax debt must be at least three years old. If the IRS does not discharge personal liability for tax debts exceeding three years, bankruptcy may extend an individual’s time to pay the remaining tax liabilities.
Filing for Bankruptcy During Tax Season
During a bankruptcy, it’s essential to file the required tax returns. Failing to do so may mean your case is dismissed. Further, taxpayers in bankruptcy should try their best to pay all current taxes as they come due. The IRS must be notified about a tax payer’s bankruptcy. If the IRS was listed as a creditor in bankruptcy then they will receive notice. A bankruptcy attorney can help you ensure the IRS is notified.
The IRS also requires any forgiven, canceled, or discharged debt as taxable income. Therefore, it must be reported on a return via Cancellation of Debt form 1099-C. The creditor or lender that has canceled the debt should provide a copy of the document.
Filing for bankruptcy can be a complex and challenging process, especially when dealing with it during tax season. Having a bankruptcy attorney prevents mistakes that could harm your case. Moreover, an experienced bankruptcy attorney ensures exemptions are maximized and as many assets are protected as can be.
Contact The Law Offices of Ronald I. Chorches to help you get your finances back on track today.
January 20, 2023
As an asset protection lawyer at our firm can tell you, it’s important to protect everything you’ve worked so hard for — that includes your body and health! According to a medical malpractice lawyer in Indianapolis, IN, it’s important to know about medical malpractice. What constitutes medical malpractice? Neglect, abuse, or misdiagnosis by a medical professional can be defined as medical malpractice. While each case is unique, and the impact it has on the victim, certain checks of accountability are in place to protect the medical professional as well as the patient involved.
Where can medical malpractice take place? Medical malpractice can take place anywhere medical professionals are and work. Hospitals, outpatient treatment centers, nursing homes, and residential homes are places where medical malpractice has been reported.
Are doctors the only ones who can injure, harm, or neglect their patients? Unfortunately no, medical professionals of all kinds can mistreat their patients. For example, hospital staff, nurses, therapists, doctors, surgeons, and paramedics are all able and capable of harming their patients.
Are medical professionals under a code of ethics or held to accountability? Yes, when doctors for example are ready to practice medicine, they take an oath swearing to do no harm to their patients. Accountability is important in the medical field as it protects patients and their care providers.
What happens if a victim chooses not to report their medical abuse or neglect? If a victim does not report medical malpractice, other innocent lives may be negatively affected, as the medical professional may continue their misconduct with other patients.
What should a patient do if they feel as though they have experienced medical malpractice? The patient should contact a medical malpractice lawyer as soon as possible if they suspect neglect or harm has occurred. Experienced attorneys such as those at Ward & Ward Law Firm counsel clients as to whether or not they have a medical malpractice case worth pursuing. The legal process can seem overwhelming and confusing for some. Thankfully, lawyers are there to help every step of the way, supporting their clients and answering any and all questions they may have. Whether the medical malpractice case settles outside of court, or an official lawsuit leads to court, a wise attorney will guide their client, supporting their needs, and fight for the best outcome available.
Medical malpractice can take place in any age group. Unfortunately, some choose to neglect or prey upon the elderly community because they believe they are the least likely to report medical malpractice. If neglect or abuse is occurring in an elderly person’s home they may feel hesitant to report it since they may fear losing their only care provider or housing situation. Safety is of the utmost importance to medical malpractice lawyers, and they will ensure that their clients are well taken care of, and placed in safe, nurturing environments as soon as possible. If you think a loved one is experiencing medical malpractice of any kind, contact an attorney today. Don’t let neglect, misdiagnosis, surgical error, or prescription mishap prevent you from pursuing accountability, justice, and compensation.
September 8, 2022
Common Bankruptcy Questions Answered
What is bankruptcy?
Bankruptcy is a legal process where a debtor, which can be an individual or business, that is unable to pay their debts can have their debt wiped out by asset liquidation. In exchange for having their debt cleared, the debtor may agree to a repayment plan. Declaring bankruptcy has several steep consequences, such as damage to your credit score, inability to take out certain loans, and foreclosure. The debtor may be able to use their liquidated assets to pay off a portion of their remaining debt.
How does bankruptcy affect your credit score?
Declaring bankruptcy is a difficult and risky decision that can impact the health of your finances in the years to come. However, it may be the only sensible option to getting a fresh financial start. Following bankruptcy, your credit score may take a hit by as much as several hundred points. Building back up your credit can be hard and will not be done immediately, but it can be done gradually over time through things like making on-time payments and using a credit card responsibly.
How can I improve my finances after bankruptcy is over?
Bankruptcy is something that no one expects to have to go through in their life. However, it is more common than you think and it is possible to recover after filing for bankruptcy. In fact, many people have been able to get into a better financial position after they have finished the bankruptcy process. Talk to a bankruptcy attorney who can help you learn more about how to improve your financial health.
What are debt relief alternatives?
There are many types of debt solutions out there that can be right for you. It can be hard to know which choice to make when you are trying to pay off your debt. Thankfully, there are several alternatives to bankruptcy that you can consider. Debt consolidation, debt settlement, and refinancing plans are just a few. The alternatives that are right for you depend on your situation and several factors, such as the type of debt you have and whether you are a homeowner.
Why should I hire a lawyer if I’m considering bankruptcy?
Skilled New Haven, CT bankruptcy attorneys like one at the Law Offices of Ronald I. Chorches are there to help you make the best decision that can allow you to arrive at the solutions that you are looking for. If you are struggling with debt and are unsure if you should file for bankruptcy, you can get help from our team and we will assess your situation. We understand how hard it is to make the right choice, especially when it comes to something like finances. There is no time to waste if you have debt that needs to be resolved. Our firm has helped many people with debt find practical and permanent solutions to their financial issues. Filing for bankruptcy has a stigma attached to it, but you’re not alone in your struggle. Contact an experienced and qualified bankruptcy attorney near you if you want to know what your options are.
September 8, 2022
Hartford’s Stilts Building Faces Foreclosure
The downtown area in Hartford, CT has long been a prime location for many businesses. However, market fluctuations that have been driven by the Covid-19 pandemic continue to impact buildings that generate a large amount of revenue. The Stilts Building currently is facing foreclosure, which would severely disrupt the commercial real estate market that has already taken a hit because of the pandemic. It is recognized as a Class A downtown office building. The foreclosure process was initiated by Wells Fargo Bank after several missed mortgage payments, but negotiations are currently in place to resolve the issue.
The building is owned by landlord Shelbourne Global Solutions and was purchased for $44.4 million. It has generated millions of dollars in real estate revenue since 2013, so if the building goes through foreclosure it would significantly reduce the total revenue of the downtown area. The building has a vacancy rate of roughly 20%. Many companies have been forced to downsize their office space due to pandemic-related expenses and a changing workforce. The potential foreclosure that Shelbourne Global Solutions is facing is just another example of how businesses are still trying to navigate the ups and downs of the real estate market well after the peak of the pandemic.
How Foreclosure Happens
Foreclosure is the process of a lender seizing or selling a home if the borrower is unable to meet their obligation to make payments. It can be triggered after certain circumstances, such as if a borrower loses their job. Once the foreclosure process has begun, it doesn’t mean that there is nothing more that a borrower can do. There are alternative options and strategies you can use to strike a deal with the lender.
If you are facing foreclosure, it is a stressful experience to go through. The prospect of losing your home is something no one should ever go through alone, so that is why it is important to seek the legal services of a qualified foreclosure lawyer.
Legal Services From a Foreclosure Lawyer
A Hartford, CT foreclosure lawyer like one at the Law Offices of Ronald I. Chorches can explain to you that you may still be able to consider several legal options if you are facing foreclosure, no matter how behind on payments you are. Their team has been successfully able to prevent the foreclosure process for many clients over the years they have been in practice. Foreclosure lawyers have the skills and years of experience to assist clients who are going through similar scenarios regarding foreclosure. They can advise you on what to do to navigate foreclosure, explain foreclosure and real estate laws, and help you fill out the necessary legal documents involved.
Contact a Qualified Lawyer
As reflected by the current challenges impacting the Stilts Building and other long-term businesses of the downtown area, even businesses that have long been in operation are not immune from the unpredictable nature of economic shifts that could lead to foreclosure. If you would like to know how you can avoid foreclosure and take the necessary precautions to resolve it, speaking to a lawyer can help you. Learn more by requesting a risk-free consultation with a foreclosure lawyer in your area now.
April 13, 2022
Chapter 7 Bankruptcy Lawyer
Many people who have gone through or graduated any sort of education beyond government mandated schooling has more than likely had to take out some form of a loan to pay for it. A chapter 7 Bankruptcy lawyer may be able to help you with wage garnishment matters.
Wage garnishment is when an individual has defaulted, or not made payments, the holder or the loan will garnish an employee’s wages directly out of their paycheck. Bankruptcy lawyer Carolyn Secor, P.A. can explain that this means they will take a percentage, usually about 15%, to help pay off his or her defaulted loan. This means that the lender will communicate to the employer and let them know that they will be directly withdrawing a portion of the employee’s wages.
With some federal student loans as PLUS or Stafford loans, the lender does not need to possess a legal judgement against the loaner to garnish his or her wages. For other lenders, they will need to initiate legal action in order to start the progress. However, on the bright side, wage garnishment is considered a last resort action, and can be avoided. Before the lender submits or starts the process of intent to garnish, the company will send out many forms of notification, through both electronic and physical mail, likely over a period of months, before initiating the process.
There are some ways to prevent your wages being garnished, even after receiving notice of intent:
- Discuss acceptable repayment terms with the Department of Education (DoE). In addition, the person should also pay the DoE for the first installment within 30 days of the notice was sent to the individual.
- Request a hearing in writing. Must also be postmarked within the 30 days of the notice being sent. If the individual is trying to request copies of documents, he or she must request a hearing as well, as it will not delay the order of garnishment.
- Provide any proof to challenge or invalidate the order. This could include an incorrect amount, legitimacy of the debt, claiming responsibility, status of financial hardship, or even the existence of the debt itself.
- Initiate any and all legal action against an individual’s employer if there is any disciplinary retaliation against the individual based on the upcoming garnishment notice.
Furthermore, if you are already having to pay or are repaying due to student loans, there are still a few ways to help escape default status and end the wage garnishment:
- Consolidating loans. This is one of the quickest ways to get out of default, although it has a high risk as well. When you consolidate a loan, you essentially take out one large, single loan to pay off all of the defaulted loans. In doing so, your status is no longer in default, as it is a new loan. Using this option can make it easier to escape default status, however, depending on the consolidation loan itself, it may be more expensive in the long run due to the interest rate and if you are able to pay off that loan effectively.
- Rehabilitating loans. This process will have you commit to making a minimum of nine out of ten monthly payments. Afterwards, you will speak with a loan servicer to decide on a payment plan from there.
- Paying off the debt – completely. While this sounds impossible, it is one of the safest and possibly one of the quickest ways to get out of default.
If you have any questions regarding student loan wage garnishment and how it may be affecting you, contact an attorney to discuss information as well as any possible next steps. A chapter 7 bankruptcy lawyer may be able to help you with your wage garnishment matters.
January 5, 2022
Financial struggles affect almost everyone, but if you are having trouble keeping track of your spending and savings, there are some helpful tips you can apply. This is especially true if you have filed for bankruptcy, as financial problems can occur despite best efforts to make responsible choices. Medical bills or an emergency repair can quickly derail your financial plans. If you are recovering after bankruptcy, keeping the following money management tips in mind can help you avoid getting into serious financial trouble again.
Review Your Credit Report
Keep an eye on your credit report regularly to watch for suspicious activity. A credit report is a summary of your financial transactions, showing information such as your loans. Knowing what’s on your credit report can give you a sense of the health of your finances. You can get free annual credit reports from the major crediting companies Equifax, Experian and TransUnion.
Stick To Your Budget
One of the biggest mistakes that people make is not making a budget. If you struggle with spending, first identify the areas where you are having trouble with. Categorize your spending so that you can see where your money is going towards each month. Setting limits for yourself can help you cut down on lower priority purchases that can be saved for a later time.
Make Payments on Time
A good way to ensure that you can stay on top of your finances is to make payments well before they are due. Late payments can be damaging to your credit score. You can set reminders for yourself a few days or a week early so that you do not accidentally miss a payment.
Explore Your Options
If you have tried other strategies on your own but are not having success, you can reach out to professionals who can assist you with your financial planning. Debt issues and other major struggles you may be facing are best handled with help from an outside party. Don’t be afraid to explore all of your options and find out what resources are available to you with the help of a trusted bankruptcy lawyer like Carolyn Secor, P.A..
Staying on top of your finances after completing the bankruptcy process can be intimidating, but picking up better money management habits will take time. Developing a suitable financial plan will take time and effort, and you are not alone in your struggles. Meeting with a bankruptcy lawyer is a good first step to take if you are not where to start. Schedule an appointment now to learn more about financial services available.