Debt Settlement Attorney Blog

Short Sale or Foreclosure? What to Consider Before Making the Decision.

Shah Peerally — Wed, 09 May 2012 17:53:00 +0000

With distressed properties, including foreclosures (or REOs)and short sales, making up about half of all single-family home sales in California in January, according to the CALIFORNIAASSOCIATION OF REALTORS®, many underwater sellers will face the tough decision between a foreclosure or a short sale. Some of the most important factors to consider before making the decision include deficiency judgments, tax implications, credit consequences and timing.

Deficiency Judgements and Tax Implications.

The good news is that California offers some protections for consumers against deficiency judgments after short sales and foreclosures. A homeowner is generally protected against a deficiency judgment after short sale for a one-to-four residential unit property. The instances in which a homeowner is generally protected against a deficiency judgment following foreclosure include, among other things, a non-judicial foreclosure or a loan that is all of the following: 1) owner-occupied, 2) secured by a one-to-four unit dwelling and 3) purchase money. Homeowners are also protected against deficiency judgments after foreclosure of seller financing. Sellers may be responsible for taxes on, among other things, cancellation of debt (COD) income, which is approximately the difference between the outstanding loan balance and the fair market value. The exceptions to being taxed on COD income include bankruptcy, insolvency and forgiveness of a non recourse debt after foreclosure.

Non recourse debt in California is when a loan is made to purchase a one-to-four unit, owner-occupied property or when the seller carries back financing. In the case of a short sale or foreclosure, the Mortgage Forgiveness Debt Relief Act of 2007 also provides an exception from federal taxation when the following conditions are met: 1) property must be a qualified principal residence as defined, 2) loan is secured by the residence, 3) income relief is capped at $1,000,000 for married couples filing separately and $2,000,000 for all others, and 4) loan is discharged after January 1, 2007 and before January 1, 2013. Additional rules apply underCalifornialaw.

Credit Consequences and Timing

Credit may be adversely affected regardless of the type of sale—foreclosure or short sale. Credit score declines can vary and the negative mark may remain on the credit report for seven years. Both foreclosures and short sales might affect the ability to quality for a loan to purchase another home. In some short sale cases where the seller may have even been current with mortgage payments but sold the home for less than the outstanding loan amount, the credit report could indicate that the debt was settled for less than what was owed and the impact may be less severe.

In the event of a foreclosure, a borrower may not be able to qualify for another home loan for seven years without any extenuating circumstances, or five years with extenuating circumstances, under current Fannie Mae guidelines. The wait may be less with short sales. If payments are in arrears in a short sale, buyers may qualify to purchase another Home within about two years for a Fannie Mae backed mortgage, or approximately three years for a FHA loan. If payments were current, consumers may qualify for another loan immediately, but it can be difficult to find a lender. Exceptions and additional considerations apply to the conditions discussed, depending on individual circumstances. For consumers facing these difficult choices, it is advisable to seek professional assistance from an attorney and/or an accountant who can evaluate your specific situation.

By Amit Gambhir

Dre # 01878801

EPIC BROKERS

3833 Peralta Blvd

Fremont, Ca 94536

Cell # -510-299-9361

Fax – 510-742-0784

Amit.epicbrokers@gmail.com

If you like this article, please click on the LIKE button below

Shah Peerally is an attorney licensed in California practicing immigration law and debt settlement. He has featured as an expert legal analyst for many TV networks such as NDTV, Times Now and Sitarree TV. Articles about Shah Peerally and his work have appeared on newspapers such as San Jose Mercury News, Oakland Tribune, US Fiji Times, Mauritius Le Quotidien, Movers & Shakers and other prominent international newspapers. His work has been commended by Congress women Nancy Pelosi and Barbara Lee. He has a weekly radio show on KLOK 1170AM and frequently participates in legal clinics in churches, temples and mosques. To learn more about Shah Peerally, visit his personal blog on www.ShahPeerally.com.

Information provided above is for educational purposes only. One should not act or refrain to act solely based on the information provided. You should consult an attorney to assess your case before proceeding.

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Attorney On Air now available on Android – Google App. – Download it for FREE!

Shah Peerally — Sun, 06 May 2012 23:24:08 +0000

Android App.

Attorney On Air is a unique educational application which offers 24/7 online audio, video and written information on the latest immigration and debt settlement news. The application covers all aspects of immigration laws with focus on the South Asian and employment immigration problems such as EB permanent residence, H1B visas, L visas, National Interest Waivers, marriage petitions, asylums, deportation and social issues related to the subject. Attorney on air also provides valuable educational information about California debt settlement issues from a law firm’s perspective regarding credit card debts, second loans and HELOC settlements.What is interesting with this application is that it is brought to you by the Shah Peerally Law Group PC and its extensive experience in both areas of law. The law group has an excellent track record in obtaining non-immigrant and immigrant visas for thousands of individuals and families. Attorney Shah Peerally has been rated among the top immigration attorneys on Avvo.com and his work has been commended by Congress people such as Nancy Pelosi and Barbara Lee. His work has appeared on major TV networks and publications in the United States and abroad.

Attorney Hasan Abdullah who is one of the immigration managing attorney of the law firm has proven one of the best immigration lawyers in California dealing successfully with difficult EB1, National Interest Waivers, H1B, L1 issues and also with the infamous INA 221(g) among many other complicated immigration issues. The application will also give his input on several current immigration issues facing the community.

In all, the application will make it easy for professionals and non professionals to be aware of some of the latest trends in certain legal fields with their social implications. Designed by Birbals.com, the Shah Peerally Law Group PC with this application hopes through this innovative endeavor to assist the immigrant and non immigrant communities to achieve their path to citizenship and re-adjust their financial status to live a happy life in the United States.

Visit Developer’s Website ›Email Developer ›

App Screenshots

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Gain idea on how the debt settlement laws have changed

Shah Peerally — Fri, 04 May 2012 04:46:55 +0000

Debt settlement is mainly about lowered debt amount with regards to the outstanding debts that you have. With debt settlement, you are actually required to pay much less than what you have incurred. As the debt amount gets lowered, the other part gets totally forgiven. Though debt settlement can easily be done of your own, some find it hard to get the creditors and collection agencies agree to the settlement request. In such situations, getting the help of a debt settlement company becomes inevitable. However, it was seen that many debt settlement companies were taking undue advantage of the people in need of debt help.

FTC and debt settlement laws

The Federal Trade Commission or the FTC had introduced a set of regulations so as to uniformly govern over the whole of the debt relief industry and especially the debt settlement industry. This was mainly done to help the consumers get fair help in their debt problems.

These regulations were introduced on October 27, 2010. According to these regulations, the debt settlement companies are supposed to:

Upfront fees – When a debtor goes to a debt settlement company for help, they charge a certain fee for their services. This rule prohibits the companies from mandating any upfront fees from the debtor until the company is able to successfully negotiate settlement with the creditors or collection agencies. The settlement company cannot collect any fees until:

A. They become successful in settling or reducing at the least one of the debts of the debtor.

B. The debt settlement company gets and also provides a written agreement in between the consumer and the creditor.

C. The consumer has been able to make at least a single payment to the creditor as per the settlement agreement as has been negotiated by the company.

Amount that is to be saved – As per FTC, the settlement company is required to provide at least an estimate on the amount that the consumer will be required to save so as to help the settlement company to make a settlement offer to creditors.
The basic information – As per the FTC rule, debt settlement companies are also supposed to provide information on the settlement program to the debtor in detail; that is, the settlement company will be required to state the time they are going to take to help the consumers and till actual results can be seen. They are also required to provide the details on the total cost of the service. They are also supposed to provide information if debt settlement is going to hurt your credit.
Dedicated account for savings – The FTC rule prohibits the settlement companies from asking the debtors to create ‘dedicated accounts’ if they cannot meet the criteria:

The account is supposed to be maintained by an insured financial institution which is not affiliated with any debt settlement company.
The consumer will have to own the funds.
The consumer should have the ability to withdraw funds from the dedicated account without having to pay any penalty.
The settlement company cannot exchange any kind of referral fees with the institution administering the dedicated account.

So, these are the regulations that have been introduced by the FTC so as to protect the consumers from scam debt settlement companies.

To get some more knowledge on debt settlement visit:https://www.ovlg.com/debt-settlement/

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Very Happy Client – 2nd Mortgage Settled!

Shah Peerally — Fri, 27 Apr 2012 19:07:24 +0000

The Shah Peerally law firm helped me settle my 2nd mortgage loan with CitiMortgage. One letter from the office stopped harassment calls and letters from the lender. NO UPFRONT FEE FOR THEIR SERVICE! The office staff kept me informed of the progress. The mortgage company wanted to settle for 50% of the loan amount. The firmed settled it at 10% and removed all the late fees that were added to the loan amount. The Shah Peerally Law firm saved my house from foreclosure! I am grateful to their hard and honest work. I highly recommend their service.

Jazz

Important: The testimonials or endorsements on this website do not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter. Each case is different and success in one case does not warrant or guarantee success in other similar cases or situations. For more information call us on 510 742 5887.

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

The Unique App. – Attorney On Air is now available on ITunes for FREE – feel free to download.

Shah Peerally — Sun, 22 Apr 2012 04:23:32 +0000

Attorney On Air is a unique educational application which offers 24/7 online audio, video and written information on the latest immigration and debt settlement news. The application covers all aspects of immigration laws with focus on the South Asian and employment immigration problems such as EB permanent residence, H1B visas, L visas, National Interest Waivers, marriage petitions, asylums, deportation and social issues related to the subject. Attorney on air also provides valuable educational information about California debt settlement issues from a law firm’s perspective regarding credit card debts, second loans and HELOC settlements.

What is interesting with this application is that it is brought to you by the Shah Peerally Law Group PC and its extensive experience in both areas of law. The law group has an excellent track record in obtaining non-immigrant and immigrant visas for thousands of individuals and families. Attorney Shah Peerally has been rated among the top immigration attorneys on Avvo.com and his work has been commended by Congress people such as Nancy Pelosi and Barbara Lee. His work has appeared on major TV networks and publications in the United States and abroad.

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Why you should settle your 2n Mortgage or HELOC fast!

Shah Peerally — Sun, 08 Apr 2012 05:09:49 +0000

IAPDA

6 Reasons why you should settle your Second loan or Home Equity Line of Credit (HELOC) NOW!

The second loan or the Home Equity lines of Credit are usually issued based on the value of the house and secured by the equity on the house. In other words, the financial institutions are safe when lending this money during a possible foreclosure as long as there is equity on the house. However with the downturn in the economy and the crash of the house market, such loans are no longer secure. While most financiers cannot recover the deficiency on the first loans, they can still get their money on a second or home equity line of credit loan even after the foreclosure. Once the property is foreclosed (unless short sale in California), the amount owed becomes an unsecured debt just like a credit card debt. This means the banks can still collect their money.

This short article gives you at least 6 reasons why you should not be ignoring such debts and settle them as soon as possible. Note that it covers only California issues.

>> Read More

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Tax issues and debt settlement! Form 1099c – listen to Koshy George, CPA.

Shah Peerally — Tue, 27 Mar 2012 23:13:39 +0000

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Another great settlement on a 2nd Mortgage – $213,000 for only $21,300

Shah Peerally — Thu, 23 Feb 2012 05:40:40 +0000

Client owed Bank of America $213,000 on her second loan on her property. This amount was settled for only $21,300 in 19 payments over 19 months with no interest or financial charges. Congrats! to our debt settlement team.

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Some of the settlement we have obtained.

Shah Peerally — Wed, 22 Feb 2012 20:00:03 +0000

Settlement LettersSettlement Letter 2

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)

Consumer Financial Protection Bureau wants to bring credit bureaus and debt collectors under its purview

Shah Peerally — Fri, 17 Feb 2012 08:35:53 +0000

AskUSAttorneys.com

According the Washington Post, the Consumer Financial Protection Bureau (CFPB) wants to bring all the major debt collectors and credit bureaus such as Experian, TransUnion, and other agencies under its purview.

“This oversight would help restore confidence that the federal government is standing beside the American consumer,” CFPB Director Richard Cordray said in a statement.

It seems that many of the agencies reporting credit were left to decide how to report the credit without oversight.

Our law firm welcomes this move on the fact that it will allow innocent debtors victim of the recession to get back on their feet. If you are facing overwhelming debts, please talk to a good debt settlement attorney or bankruptcy lawyer. For more information please call 510.742.5887.

If you like this article, please click on the LIKE button below

For updates follow us on Radio, Facebook, Twitter and LinkedIn. Our law firm also deals in immigration law. Visit www.peerallylaw.com and www.immigrationlegalblog.com. You can reach us 510.742.5887.

Listen to our radio shows on KLOK 1170 AM Radio on Tuesday from 11am to 12pm and Friday from 11pm to 1am (Saturday)