Sacramento Bankruptcy Lawyer Blog

Jim Wasserman, reporter for the Sacramento Bee reported in a recent article titled California home foreclosures hit Latinos hardest, study says, that California Lenders foreclosed on more homes owned by Latinos and African American then any other ethic groups. The National Council of La Raza (CRL) reported 48% of all homes that were foreclosed in California were owned by Latinos and African Americans. The study further indicated that about 11% of all California's foreclosures - 69,176 occurred in El Dorado, Placer, Sacramento, Solano and Yolo counties. Thus, nearly 6 out of every 10 homes that were foreclosed in California were owned by African American and Latinos. For additional information, go to the National Council of La Raza website.

Latinos and African Americans were hit the hardest because dishonest brokers preyed upon them by selling them high-cost loans. In particular, Latinos were steered into risky loans products that were bound to fail. The CRL study further reported that most of the Latinos borrowers were not buying far more house than they could afford. Paul Leonard, director of the CRL was quoted as saying "that these were regular folks in modest-priced homes, but were sold loans that were harder to sustain when the bubble burst and through the unemployment that followed".

We have seen more African Americans and Latinos filing bankruptcy as a result of the foreclosure of their homes and due to the fact that they are being sued by Lenders who hold second deeds of trusts or second mortgages on their homes.

Solano bankruptcy attorneys can help with either discharging or wiping out most second mortgages.

Bankruptcy and Retirement

For many of our seniors, filing bankruptcy has been unthinkable. There are practical considerations, such as:

• The type of debts--secured (for example, homes and cars) and unsecured (credit cards, personal loans);
• Income--for work or from retirement; and
• What property you own that may be protected if you file for bankruptcy (such as retirement accounts, pensions, IRSs, etc.

Consideration of Bankruptcy

Some of Your Assets May Not Be Touched. Retirement accounts, Social Security Benefits and home equity may be exempt (protected and excluded) from the claims of your creditors under the Bankruptcy Law.

Be Honest About Your Finances. Don't ignore your financial problems and watch for signs that a parent or grandparent might be trying to hide their problems.

The Reality of Debt. Poor choices are frequently made when you rely on poor advice. You may sell assets to pay debts that may be discharged in bankruptcy,

Is Bankruptcy a Good Strategy?

Bankruptcy may fit into a strategy that will preserve your retirement assets and your retirement plans and might be best in your situation. Bankruptcy may remove some debts--particularly the credit card debts.

However, it is also important to look honestly at the causes of your financial problems and take action to avoid them in the future. If your debts are related to gambling--you may need help beyond the scope of bankruptcy.

Successful retirement is hard. Talking to a knowledgeable and experienced attorney who practices bankruptcy law, elder law, and estate planning law may help you decide what to do.

Questions for Your Attorney-- Should I think about bankruptcy?

How would the payments my mother receives through her reverse mortgage be treated in bankruptcy?

If I keep making minimum payments on my medical expenses and credit cards--how long will it take to pay them off?

My two biggest assets are my paid-for house and my retirement accounts--what happens in bankruptcy?

For more information regarding bankruptcy and retirement, contact Sacramento and Solano attorneys.

The US government will provide funds to assist struggling unemployed California homeowners pay their mortgage payment.

Starting November 1, 2010, federal funding will aid California homeowners who are out of work and need assistance in paying their mortgages. The funding will come from a federal program known as the Asset Relief Program. For more information about mortgage assistance, visit this website CalHFA Mortgage Assistance Corporation. The federal government is adding an additional $476.2 million to the state program that will pay homeowners up to $1,500.00 per month. Struggling homeowners will be allowed up to $1,500.00 per month, not to exceed 6 months. Of course, there is a catch. California homeowners must qualify. In order to qualifying for the program, California homeowner must be out of work, eligible for unemployment benefits, and live in a home that is tied to a problem mortgage. In addition, homeowner must be fewer than 90 days behind on their mortgage payments and have income less than $70,000 for couples in El Dorado, Placer, and Sacramento and Yolo counties and less than $54,000.00 for couples in Yuba and Sutter counties.

This government program is designed to help prevent homeowners from losing their homes to foreclosure. The program estimates that 19,000 unemployed California borrowers will be helped.

Sacramento's unemployment rate has hit a record high of 12.4% and nearly 20% in Yuba and Sutter counties. Although these funds will help, I fear that many California homeowners are already more than 90 days behind on their mortgage payments. In addition, many homeowners in Sacramento and Solano Counties have been unemployed for over a year and have fallen behind on their payments in an attempt to qualify for programs such as the Home Affordable Modification Program (HAMP). Now, it will be difficult for people to attempt to qualify for these new funds that will be available November 1, 2010.

However, for those who qualify for the funds will be able use those funds to assist them make their mortgage payments until they either get back to work or granted a home loan modification.

Homeowners who fall behind on their mortgage payments and need time to catch up may also benefits by filing Chapter 13 Bankruptcy. Homeowners can use the funds received under this new program to help make their ongoing mortgage payments and put any mortgage arrearages (past due payments) inside a Chapter 13 bankruptcy. Sacramento and Solano bankruptcy attorneys can help you.

Jonnelle Marte, reporter for the Wall Street Journal outlines the new rules for credit card companies in a recent article titled, "New Law Forcing Credit-Card Issuers to Play Fair" Starting August 1, 2010, credit card companies implement the latest credit card rules under the new Credit Card Act, formally known as the Credit Card Accountability and Disclosure Act which requires card companies to give consumers 45 days advanced notice before increasing interest rates, changed fees and other changes.

The new Credit Card Reform Act, which was signed into law by President Obama, created a new consumer-protection agency. This new consumer agency oversees and affords Sacramento consumers more consumer protections. Sacramento Consumers will be entitled to more time and rights to reject changes to their accounts, such as over the limit fees and increased interest rates

One of the most important changes that I believe will help Sacramento consumers is the provision which provides those consumers who pay more than the minimum payment with the expectation of reducing their debt balance, the credit card companies will have to apply the excess amount to the amount with the higher interest rate.

The credit card companies have taken steps to counter act the new protections for Sacramento consumers. Unfortunately, the news may not be enough to give Sacramento consumers enough relief. However, it is good start. Sacramento bankruptcy attorneys can help you with your consumer debt problems.