Atlanta Bankruptcy Attorney Blog

The good news is that a new FHA program could help underwater borrowers make their mortgages more affordable. The bad news? For many homeowners, it's too good to be true, say Atlanta bankruptcy attorneys.

Known as the Short Refi initiative, the program allows lenders and investors to agree on writing off a portion of a loan's principal balance - at least 10 percent. Borrowers are able to participate so long as they don't currently hold an FHA loan and are current on their house payments. So what's the problem? Loans held by government-backed Freddie Mac and Fannie Mae - in other words, the majority of mortgages in the U.S. - are ineligible.

Continue reading "Is Loan Modification Or Bankruptcy A Better Choice for Atlanta Homeowners?" »

FHA loans were designed to make housing possible for more Americans. So what happens when they become more expensive?

Borrowers will soon find out, say Atlanta bankruptcy attorneys. The Federal Housing Administration recently announced plans to hike premiums for the government-insured loans by one quarter of a percent. It might not sound like much, but the increase comes just months after FHA raised its down payment requirement from 5 to 10 percent and added a minimum credit score of 500. It all adds up to make an affordable loan just out of reach for some homebuyers.

Continue reading "FHA Loans About to Get More Expensive For Atlanta Borrowers" »

It looks like Uncle Sam might be learning from his mistakes when it comes to helping struggling homeowners, say Atlanta bankruptcy attorneys.

With the Home Affordable Modification Plan enacted during the recession a seemingly multi-billion dollar flop, the federal government may be turning to a method that's actually been proven to work - bankruptcy. In a bill proposed by Sen. Sheldon Whitehouse, bankruptcy is being explored as an alternative for homeowners in need of modified mortgage terms. And with U.S. foreclosures expected to surpass 12 million next year, it couldn't come too soon.

Continue reading "Senator Suggests Bankruptcy As A Better Alternative To Mortgage Modification" »

Millions of Americans are about to finally get a pay raise. But here's the really surprising part - millions aren't even going to realize it until the money's all gone.

If you haven't already heard, President Obama signed a payroll tax cut into law in December. Starting this month, just 4.2 percent--instead of the typical 6.2 percent--will be withheld from your paycheck for Social Security. That means you'll get to keep the extra 2 percent--or about $1,000 for a person earning $50,000 a year ($2,000 if you also have a spouse who brings home 50K). But because the money will be divided throughout the year among your paychecks, chances are most people won't even notice the increase--and therefore won't spend it wisely, say Atlanta bankruptcy attorneys.

Continue reading "Increase the Impact of Your Tax Cut By Paying Down Debt" »

A new washing machine is the really expensive equivalent of getting a pair of socks or underwear for Christmas. It's not fun per se, but it's useful - especially if you can buy said washing machine before Dec. 31.

For the past 24 months, shoppers have been able to get back 30 percent - or up to $1,500 - of the money spent on energy-efficient products like dishwashers, windows, refrigerators and more. It's been an easy way for short-on-cash Americans to upgrade to modern and more environmentally-friendly appliances, say Atlanta bankruptcy attorneys. But it's about to disappear. To get the discount, homeowners must have eligible products installed and ready to go by the last day of 2010.

Continue reading "Atlanta Shoppers Take Advantage of Expiring Credit for New Appliances" »

If at first you don't succeed, try, try again - it could be the motto of big banks following Thursday's passage of the financial regulation bill.

Banks have for months been attempting to stop the legislation, which will cut into their profits from debit card fees - and which could in turn lower prices for the many folks struggling to pay the bills, say Atlanta bankruptcy attorneys. But now that Plan A has failed, banks are turning to Plan B - shifting fees somewhere else.

Continue reading "Big Banks Add New Fees to Counter Passage of Financial Reform Bill" »

It was years in the making, but it looks the financial reform bill is finally on its way to becoming a reality. The question now is, how much will it actually reform - especially for those of us overwhelmed by debt?

You've probably heard about how the overhaul aims to reorganize the financial system to avoid another economic meltdown like the one that began almost two years ago. But that's not all, say Atlanta bankruptcy attorneys. If it passes, these changes will have an effect on consumers as well, from how we understand our credit card bill to how we pay for things at the store. What won't necessarily change, though, is whether or not we're able to overhaul our own finances.

Continue reading "What the Financial Overhaul Bill Can and Can't Do for Atlanta Consumers" »

If credit card fees have been eating into your paycheck, you're about to get another break.

On Tuesday, the Fed adopted yet another set of credit card limitations. This round of laws limits credit card late fees to $25 and keeps creditors from charging a penalty larger than the charge that caused the violation - for instance, instead of slapping you with a $30 fee for going over your credit limit by just $5, you won't have to pay more than five bucks. Nor will banks be able to charge more than one fee per violation. And - my favorite - no more inactivity fees (seriously, how is it fair to penalize someone for choosing not to spend money?).

But despite all the positive changes, the new rules still won't get to the root of most folks' credit card problems when they go into effect in August.

Continue reading "Atlanta Credit Users Can Lower Credit Card Fees with New Fed Laws" »

If proposals in a new finance bill passed by the Senate come true, the finance industry could get a lot easier to navigate for Atlanta consumers.

We're talking free credit scores, a reduction in mortgage penalties and the creation of a new oversight agency to protect consumers. Watch out, lenders - the game might be played differently when consumers actually have a fair shot.

Here's a quick summary of some of the bill's most intriguing possibilities. But first, a disclaimer: this is all still speculation. We don't know when the bill will be finalized, or what will be left in it when it is. If you're looking to lower debt and improve your finances, you can't afford to wait for the government to hold your hand - not when there are effective ways to take matters into your own hands, like bankruptcy.

Continue reading "Proposals in Finance Bill Could Help Atlanta Consumers Save Money and Improve Credit" »

What's more important than filling out the 2010 U.S. Census? Making sure that the form you're filling out is actually the census - and not an attempt to steal your identity, according to Atlanta bankruptcy attorneys.

Now, this isn't meant to discourage you from participating in the census. Remember, the more people that get counted in your community, the more federal money your community can receive. Besides, the sooner you get your official census form turned in, the better.

Procrastinating ups the odds that a census worker will follow up with you by calling or knocking on your door. Problem is, a phony worker could do the same, increasing your risk of identity theft. Here's how to tell the difference.

Continue reading "Atlanta Residents Can Avoid 2010 Census Scams by Using Caution " »

In the market for a new refrigerator? Uncle Sam might be willing to help foot the bill, say Atlanta bankruptcy attorneys.

With Cash for Clunkers no longer, the government hopes to stimulate the economy with a new program that targets household appliances. Starting this year, up to $300 million will be available for folks who purchase new refrigerators, washers, heating and air units and more. The goal is twofold: first, to get consumers out there spending and, second, to replace old, energy-guzzling appliances with modern energy-efficient ones. For example, a brand new washer typically uses 50 percent less water, and spins clothes so efficiently that it also reduces dryer time.

As with any seemingly good deal, though, there are still pros and cons. If your washing machine is about to bite the dust and you can afford a new one, this might be a golden opportunity to save some green. However, if you're already struggling to pay off your credit card bills, you may not be able to afford another major purchase - whether or not you get a sweet discount.

Continue reading "Atlanta Bankruptcy Attorneys Weigh Benefits and Drawbacks to Energy-Efficient Appliance Rebate Program" »

Contrary to homeowner hopes, Uncle Sam's $75 billion mortgage modification program may be causing more bad than good.

Created early last year, the program was supposed to encourage banks to modify loans of the millions of Americans facing foreclosure. Unfortunately, it's managed to permanently modify just 35,000 - a drop in a rather large bucket, when you consider that 15 million U.S. homeowners are underwater, meaning they owe more on their loan than their house is worth. And of the homeowners that did get help, many went into foreclosure anyway since the program only required banks to lower mortgage payments - not to restore any equity.

But the biggest problem isn't that the program is failing - it's that it's given folks a false sense of security. Many homeowners held out hope that the program would save their home, so they didn't take preventative measures that could have stopped foreclosure, such as Chapter 13 bankruptcy. Fortunately, there may still be time, according to Atlanta bankruptcy attorneys.

Continue reading "Atlanta Bankruptcy Attorneys Warn That Government Mortgage Program Is Increasing Foreclosures" »

I guess Uncle Sam never learned that it's not polite to take back a gift.

Recently it was announced that up to 15 million taxpayers could owe money from a tax credit back to the government come tax season. So what happened exactly? Under the Making Work Pay part of the stimulus package, employed Americans received a tax credit of $400 for individuals and $800 for married couples. Since it was a payroll credit, workers received the money by having less withheld on their paychecks - meaning more take-home pay. But somehow, government officials failed to take a few common cases into account when changing the tax withholding tables.

For instance, let's say you're holding down two jobs and making more than 20K at each. You could have received two credits - and will owe Uncle Sam $400 back when tax season rolls around. You may also have received too much money if you're married and both you and your spouse work and file jointly, if you're a retiree with income withheld on your pension or if you're a college student still claimed as a dependent - meaning Uncle Sam also wants a refund.

It's definitely a blow to hard-working Americans. But it's also an excellent reminder of why it's important to plan for the worst (while hoping for the best, of course!), whether you're talking about a paycheck, bonus, windfall or even a government handout.

Continue reading "Taxpayers Could Owe Stimulus Money Back to Government" »

It's official - the Cash for Clunkers program is a hit. But while that might be good news for the ailing auto industry, it's not necessarily good news for consumers.

In case you're not familiar with the program, here's how it works. When you turn in a low-mileage vehicle for one that meets higher-mileage guidelines set by the government, you get up to $4,500 off your purchase. Sounds like a lot of money, right? But not when consider that Cash for Clunkers presents the same problem as the blowout sale at your local discount store.

Let's say you buy a pair of shoes normally priced at $50 for 50% off. You might think you're saving $25 - but that's only true if you planned to buy that pair of shoes no matter what. If you only purchased them because of the sale, you're actually out $25. It's the same thing with cars. If you were dead-set on buying a new hybrid anyway, then yes, you're getting a great deal. But if you're using the incentive as an excuse to get a shiny new toy that you really can't afford, then you're not getting a bargain - in a way, you're getting ripped off.

Continue reading "Cash for Clunkers Might Not Be Such a Good Deal" »