How to reach me

Communication resolves all issues - if people want to resolve them.

I cant respond to anonymous email.

However, more than once I have said "Please email me with any issues."

I am deeply committed to helping people with any issue they authentically want help with, but those who choose not to communicate must, thereby, have another agenda - not be happy and satisfied.

In the end, all I can do is invite committed and authentic communication to resolve any upset.

Thanks

Happy to hear from people

Anyone who writes I am glad to respond to and support.

Hard to respond to "anonomous" posts. My email is on this blog - I am easy to reach...unless you don't want to speak and have an agenda. I am even open for that - and always have a solution. Unfortunately, I cant help solve what I dont know about.

I welcome any and all conversation!

Thanks.

Scott

Bankrutpcy Filings Up

In the New York Times it was reported by Duff Wilson on Friday, April 20th, 2010 that there was a "Sharp Increase in Personal Bankruptcies" in March.

They seemed to be surprised. Why?

This is the perfect storm - high unemployment, real estate bubble bursts, banks out for every dime they can squeeze, medical bills soaring - what did they think would happen?

Facts:

158,000 bankruptcy fillings in March
6,900 a day
35% increase from February 2010

Chapter 7's have increased to 73% from 62% a few years ago, signaling that people are in even worse financial shape than ever. They cant even qualify for Chapter 13 Bankruptcy despite the government's attempts to hurt EVERYONE possible into a 13!

The big problem: Joblessness

Even if people get back to work, they used credit cards to pay for living expenses during their unemployment - credit card debt that history shows they will never be able to pay back. Most cards run interest at 29% plus "fees".

The next wave of bankruptcy is coming soon.

The impact will be greater. "Fewer people are trying to same their homes" said University of Iowa law professor and bankruptcy expert Katherine M. Porter. "They realize their payments are not affordable" and just cannot make the payments.

Regardless of what the public might think, bankruptcy cannot lower the 1st Mortgage Payments.

Bank of America? Bank of Fees!

Last week was an unprecedented blow for freedom for the American consumer. The Courts are finally starting to deal with the allegations of fee creating by some of the largets banks in America.

Anyone who has ever had an account with these banks knows they play with deposits and withdrawals to create fees.

In a huge suit, Miami Federal judges denied a Motion to Dismiss by a number of banks in which they are accussed of having excessive and abusive overdraft fees. This will pave the way for a class action law suit, wherein the power of a group will rival the power of the big banking institutions. There is a great article about the suit in the South Florida Business Journal.

Bank of America then announced that they are no longer charging these fees...as a feel good attempt to throw people off the scent.

Short Sales touted as new solution - Watch Out!

Short Sales! Many people in debt work tirelessly to create a short sale. 7 of 10 never close, says Florida Real Estate Attorney Michael Hirsch.

Even CNN today hopped on the bandwagon of so called "Short Sales" as the new answer to the mortgage foreclosure and debt crisis. Clark Howard reported this morning that Banks are now looking to streamline the process and approvals for short sales. That's good for the consumer, right?

Wrong.

Very wrong.

It is important to understand the public perception of what a "short sale" actually is. People in financial trouble have an even scarier notion. The popular understanding in the public is that a short sale is:

1. the sale of real estate
2. at fair market value
3. by the Owner
4. with permission from the Bank (mortgage holder)

The problem is the next myth that most of the public and definitely the person in financial trouble tend to believe:

5. that absolves the Owner of any further liability

6. and helps your credit rating

Most people believe if they short sale the property they are free of the debt surrounding the house. Not necessarily. You really have to have a competent attorney read all the paperwork. Most short sales leave you on the hook for the deficiency, that is the balance of the note after the proceeds of the sale is applied to the note.

Another issue is that often the Bank "forgives" the balance, and you receive a for 1099 for the balance of the loan not paid. That means taxes may be due.

Further, the short sale may not affect your credit at all. There is little evidence that the failure to make payments, followed by a sale in which the balance is not paid is any worse than filing bankruptcy.

Short sales are NOT the panacea that everyone is proclaiming. Banks are merely trying to mitigate their up front losses on a sale, but don't be fooled into thinking you are guaranteed to walk away with no further debt or obligation.

Think twice and read the documents 3 times!

And go see a great attorney!

Bankruptcy Filings are up, up, up!

The Associated Press reported that the number of individual (consumer) and business bankruptcies are up again this year. This increase is despite a 2005 Bankruptcy Reform Act that endeavored to make it much more difficult for individuals to file for their Federal Bankruptcy Protection that has been around since the beginning of our country.

According to court records analyzed by the AP last month, in the past 12 months more than 1.2 million people filed for bankruptcy protection. Bob Lawless, a law professor at the University of Illinois College of Law predicts that there will be 1.5 million bankruptcies this year, followed by 1.6 million next year. In Broward, Palm Beach and Miami-Dade counties 2,007 people filed for bankruptcy in March of this year.

In a speech to Consumer Bankruptcy Attorneys by Scott Forgey, citing current unemployment intensity of both numbers and durations, and extrapolating from the NAFTA bankruptcies that his firm filed in the 90's in the mid west, Scott expects that the number of filings will be nearer to 1.5 million for the next five to seven years. That the economy may turn around in 3 years is years too late for the average worker.

Most workers and consumers have less than a 3 month cash reserve, instead relying on credit. Workforce One of Broward County confirmed that most employees that are unemployed past 3 months after any severance pay are beginning to miss payments and are in danger of defaulting on major items, like mortgages.

There is no safety net. Credit Cards debt is the worst of all possible solutions to most of the desperate, but it is their last solution. The new legislation will do nothing to stop the increase of unsecured and high interest loans that people turn to as a last resort.

Who is going to help the working class?

What is going to happen to all who feed on their consumer spending?


With the working class officially bankrupt, the domino effect is inevitable.

Flordia now leads!

Yes! Florida has the dubious distinction of having the highest foreclosure rates in the country.

In an article from the South Florida Business Journal, the following stats were displayed:


"The survey found that 20.1 percent of mortgages on Florida homes were delinquent or held in foreclosure. Nationwide, more than 11 percent of American homeowners are either delinquent or in foreclosure.
The survey covered 85 percent of the country’s 1-4 family residential mortgages.
In the fourth quarter, 11.1 percent of Florida residential mortgages were past due by at least 30 days – with 4.4 percent past due more than 90 days.
Nationwide, the number of borrowers at least one month behind in their payments – but not in foreclosure – rose to nearly 8 percent during the fourth quarter. That is the highest rate of delinquency ever recorded by the survey, which began in 1972. It reflects a record 13 percent jump compared to the third quarter.
Nearly 9 percent of Florida residential mortgages were held as foreclosure inventory at the end of 2008 – the highest rate in the nation. An additional 2.4 percent of Florida residential mortgages started foreclosure during the fourth quarter.


What does this mean?

Well...think how long the inventories of "dead properties" (properties that are not producing revenue or value for consumers) will stay out of the marketplace. The average foreclosure, sale and sale to the public is well over two years...and that is if the bank can find the notes.

This property value issue is going to drag along as properties will continue to flood the market, exceeding demand (and credit availability) for years to come.

Anyone who is remotely connected to housing and construction is effectively out of work.

The ripple effect will intensify.


Bankrutpcy would allow for a quick adjustment of the valuation of the real estate...just like a stock market correction...but the banks oppose any mention of allowing the bankrutpcy courts to write down equity values...prolonging the death throws.