Wednesday
Small Claims Court
“Small claims court” is a special court where claims for $5,000 or less are decided. A “natural person” (not a business or public entity) may claim up to $7,500, including a sole proprietor. You are the Defendant—the person being sued. The person who is suing you is the Plaintiff. http://www.marshalynne.com/forms/Small Claims.pdf
Protective Order
This order is valid and entitled to enforcement in each jurisdiction throughout the 50 United States, the District of Columbia, all tribal lands, and all U.S. territories, and shall be enforced as if it were an order of that jurisdiction.
Law enforcement must determine whether the restrained person had notice of the order. If notice cannot be verified, law enforcement must advise the restrained person of the terms of the order and, if the restrained person fails to comply, shall enforce it.
The restrained person must not harass, strike, threaten, assault (sexually or otherwise), follow, stalk, molest, destroy or damage personal or real property, disturb the peace, keep under surveillance, or block movements of the protected persons named.
http://www.marshalynne.com/forms/Protect Order.pdf
Law enforcement must determine whether the restrained person had notice of the order. If notice cannot be verified, law enforcement must advise the restrained person of the terms of the order and, if the restrained person fails to comply, shall enforce it.
The restrained person must not harass, strike, threaten, assault (sexually or otherwise), follow, stalk, molest, destroy or damage personal or real property, disturb the peace, keep under surveillance, or block movements of the protected persons named.
http://www.marshalynne.com/forms/Protect Order.pdf
Name Change Request
Use this form to request that the court order that a new birth certificate be issued reflecting the gender and name changes sought by this petition. You must file this petition in the superior court of the county where the person whose name is to be changed resides.
http://www.marshalynne.com/forms/Name Change.pdf
http://www.marshalynne.com/forms/Name Change.pdf
Menacing Dog Petition
Complete this form to request a hearing under Food and Agricultural Code section 31601 et seq. to declare a dog to be potentially dangerous or vicious. Have an animal control officer or a law enforcement officer investigate and determine if probable cause exists to believe that the dog is potentially dangerous or vicious. http://www.marshalynne.com/forms/Menacing Dog.pdf
Marriage Dissolution
Petition for Dissolution of Marriage.
Dissolution or legal separation may automatically cancel the rights of a spouse under the other spouse's will, trust, retirement plan, power of attorney, pay on death bank account, survivorship rights to any property owned in joint tenancy, and any other similar thing. It does not automatically cancel the right of a spouse as beneficiary of the other spouse's life insurance policy.
You should review these matters, as well as any credit cards, other credit accounts, insurance polices, retirement plans, and credit reports to determine whether they should be changed or whether you should take any other actions. However, some changes may
require the agreement of your spouse or a court order.
If there are minor children born to or adopted by the Petitioner and Respondent before or during this marriage, the court will make orders for the support of the children upon request and submission of financial forms by the requesting party. An earnings assignment may be issued without further notice. Any party required to pay support must pay interest on overdue amounts at the "legal" rate, which is currently 10 percent.
http://www.marshalynne.com/forms/Marriage Dissolve.pdf
Dissolution or legal separation may automatically cancel the rights of a spouse under the other spouse's will, trust, retirement plan, power of attorney, pay on death bank account, survivorship rights to any property owned in joint tenancy, and any other similar thing. It does not automatically cancel the right of a spouse as beneficiary of the other spouse's life insurance policy.
You should review these matters, as well as any credit cards, other credit accounts, insurance polices, retirement plans, and credit reports to determine whether they should be changed or whether you should take any other actions. However, some changes may
require the agreement of your spouse or a court order.
If there are minor children born to or adopted by the Petitioner and Respondent before or during this marriage, the court will make orders for the support of the children upon request and submission of financial forms by the requesting party. An earnings assignment may be issued without further notice. Any party required to pay support must pay interest on overdue amounts at the "legal" rate, which is currently 10 percent.
http://www.marshalynne.com/forms/Marriage Dissolve.pdf
Certificate For Identity Theft
Complete this form if you need a Certificate of Identity Theft: Judicial Finding of Factual Innocence, because you have been the victim of the crime of identity theft. (If available, attach a copy of the report of the suspected crime of identity theft, issued by the local law enforcement agency that has jurisdiction over your actual residence. http://www.marshalynne.com/forms/Identity Theft.pdf
Fictitious Business
If you want to file a small claim and you are doing business under a fictitious name (“doing business as,” or “dba”) complete the following form. (Nonprofits and exempt real estate investment trusts do not have to file this form.)
You must follow the laws for fictitious business names. If you have not followed these laws, including filing a fictitious business name statement in your county and publishing this information in a local newspaper, the court can dismiss your case.
http://www.marshalynne.com/forms/Fictitious Business.pdf
You must follow the laws for fictitious business names. If you have not followed these laws, including filing a fictitious business name statement in your county and publishing this information in a local newspaper, the court can dismiss your case.
http://www.marshalynne.com/forms/Fictitious Business.pdf
Adoption Request
Use this form to ask the court to approve the adoption and to declare that the adopting parents and the child have the legal relationship of parent and child, with all the rights and duties of this relationship, including the right of inheritance. If you are adopting more than one child, fill out an adoption request for each child. http://www.marshalynne.com/forms/Adoption Request.pdf
New Jersey Certificate of Incorporation
This form constitutes your original certificate of incorporation / formation/ registration /authority, and the information contained in the filed form is considered public.
Remember that the name must be distinguishable from other names on the State’s data base. The Division of Revenue will check the proposed name for availability as part of the filing review process. If desired, you can reserve/register a name prior to submitting your filing by obtaining a reservation/registration. http://www.marshalynne.com/forms/NewJersey NewEntity.pdf
Remember that the name must be distinguishable from other names on the State’s data base. The Division of Revenue will check the proposed name for availability as part of the filing review process. If desired, you can reserve/register a name prior to submitting your filing by obtaining a reservation/registration. http://www.marshalynne.com/forms/NewJersey NewEntity.pdf
New Jersey Business Registration
If you are forming a Corporation, Limited Liability Company, Limited Partnership or a Limited Liability Partnership you may complete this form for the State of New Jersey. Select another form if you are a Sole Proprietorship or Partnership without employees.
Once you are registered as a New Business Entity, you will be required to file an annual report for the entity. This report must be filed annually on the anniversary month of the business entity's formation. http://www.marshalynne.com/forms/NewJersey CorpForm.pdf
Once you are registered as a New Business Entity, you will be required to file an annual report for the entity. This report must be filed annually on the anniversary month of the business entity's formation. http://www.marshalynne.com/forms/NewJersey CorpForm.pdf
Nevada Registered Agent Appointment
An Officer must sign the form. Form must be in the possession of the Secretary of State on or before the last day of the first month following the initial registration date. Return the completed form to: Secretary of State, 202 North Carson Street, Carson City, Nevada. http://www.marshalynne.com/forms/Nevada Officers.pdf
Nevada Non-Profit Articles
Names and Addresses of the Board of Directors/Trustees: (each Director / Trustee must be a natural person at least 18 years of age; attach additional page if more than four directors/trustees) http://www.marshalynne.com/forms/Nevada NonProfit.pdf
Nevada Company Name Reservation
The attached form may be used to reserve a name in the State of Nevada for a period of 90 days. http://www.marshalynne.com/forms/Nevada NameReservation.pdf
Nevada Limited Liability Company
Name of Limited-Liability Company: (must contain approved limited-liability company wording. http://www.marshalynne.com/forms/Nevada Llc.pdf
Nevada Articles of Incorporation
Names and Addresses of the Board of Directors/Trustees: (each director / Trustee must be a natural person at least 18 years of age. Attach additional page if more than two directors/trustees.) http://www.marshalynne.com/forms/Nevada Corporation.pdf
Florida Limited Partnership
Attached is a form to file a Florida limited partnership or limited liability limited partnership pursuant to section 620.1201, Florida Statutes. Section 620.1204, Florida Statutes, requires the certificate of limited partnership to be signed by all general partners.
Every legal or commercial business entity listed as a general partner on the attached certificate of limited partnership must have an active registration or filing on file with the Florida Department of State before the enclosed document can be processed by this office. http://www.marshalynne.com/forms/Florida LLP.pdf
Every legal or commercial business entity listed as a general partner on the attached certificate of limited partnership must have an active registration or filing on file with the Florida Department of State before the enclosed document can be processed by this office. http://www.marshalynne.com/forms/Florida LLP.pdf
Florida Limited Liability Company
Attached are the forms and instructions to form a Florida Limited Liability Company pursuant to Chapter 608, Florida Statutes. All information included in the Articles of Organization must be in English and must be typewritten or printed legibly. If this requirement is not met, the document will be returned for correction(s).
The name of a limited liability company must be distinguishable on the records of the Florida Department of State. A preliminary search for name availability can be made on the Internet through the Division’s records.
The name of the limited liability company, which must end with the words "Limited Liability Company," the abbreviation "L.L.C.," or the designation "LLC." (The word "limited" may be abbreviated as "Ltd." and the word "company" may be abbreviated as "Co.") http://www.marshalynne.com/forms/Florida LLC.pdf
Delaware Non-Profit Association
The attached is the Certificate of Incorporation to be filed in accordance with the General Corporation Law of the State of Delaware. The fee to file the Certificate is $89.00. If your document is more than 1 page, you must submit $9.00 for each additional page.
The purpose of the corporation is to engage in any lawful act of activity for which corporations may be organized under the General Corporation Law of Delaware. (If the corporation is to be a nonprofit corporation, please add: "This Corporation shall be a nonprofit corporation.")
The Delaware Division of Corporations only requires a statement indicating that you are a non-profit corporation however the Internal Revenue Service has additional requirements. http://www.marshalynne.com/forms/Delaware NonProfit.pdf
The purpose of the corporation is to engage in any lawful act of activity for which corporations may be organized under the General Corporation Law of Delaware. (If the corporation is to be a nonprofit corporation, please add: "This Corporation shall be a nonprofit corporation.")
The Delaware Division of Corporations only requires a statement indicating that you are a non-profit corporation however the Internal Revenue Service has additional requirements. http://www.marshalynne.com/forms/Delaware NonProfit.pdf
Delaware LLP Name Reservation
Attached is an application for Reservation of Limited Liability Partnership Name to be filed in accordance with the Limited Liability Partnership Act of the State of Delaware. The fee to file the application is $75.00 to be accompanied with a completed application. http://www.marshalynne.com/forms/Delaware LLPNameRsvp.pdf
Delaware Limited Liability Partnership
The attached form is the Certificate of Limited Partnership to be filed in accordance with the Limited Partnership Act of the State of Delaware. The fee to file the Certificate is $200.00. You will receive a stamped "Filed" copy of your submitted document. You may request a certified copy for an additional $30. http://www.marshalynne.com/forms/Delaware LLP.pdf
Delaware LLC Name Reservation
The attached is an application for Reservation of Limited Liability Company to be filed in accordance with the Limited Liability Act of the State of Delaware. The fee to file the application is $75.00 to be accompanied with a completed application. Please make your check payable to the "Delaware Secretary of State". An invoice and copy of your application will be returned for your records. http://www.marshalynne.com/forms/Delaware%20LLCNameRsvp.pdf
Delaware Limited Liability Company
Complete a copy of the Certificate of Formation and file in accordance with the Limited Liability Company Act of the State of Delaware. The fee to file the Certificate is $90.00. You will receive a stamped filed copy of your submitted document. A certified copy may be requested for an additional $30. Make sure to thoroughly complete all information requested on this form. It is important that the execution be legible, we request that you print or type your name under the signature line. http://www.marshalynne.com/forms/Delaware LLC.pdf
California Registration of Trademark
Applicant declares that the applicant is the owner of the mark, that the mark is in use, and that to the knowledge of the person verifying the application, no other person has registered in this state, or has the right to use the mark, either in the identical form or in such near resemblance as to be likely, when applied to the goods or services of the other person, to cause confusion, to cause mistake, or to deceive. http://www.marshalynne.com/forms/CAStateTrademark.pdf
California Non-Profit Association
Registration of an unicorporated Non-Profit Association. Association includes any lodge, order, beneficial association, fraternal or beneficial society, historical, military, or veterans organization, labor union, foundation, or federation, or any other society, organization, or association, or degree, branch, subordinate lodge, or auxiliary thereof. http://www.marshalynne.com/forms/Calif NonProfit.pdf
California LLC,LLP Name Reservation
To request the reservation of a corporation, limited liability company or limited partnership name, complete the Name Reservation Request Form on the following page, attach a check in the amount of $10.00 (made payable to the Secretary of State) and submit the request. http://www.marshalynne.com/forms/Calif NameRsvp.pdf
California Limited Partnership
Registration of a limited partnership with the California Secretary of State will obligate a limited partnership to pay to the Franchise Tax Board an annual minimum tax of $800.00. The tax is required to be paid for the taxable year of registration and each taxable year, or part thereof, until a Certificate of Cancellation is filed with the California Secretary of State. A $70.00 filing fee must accompany this form. http://www.marshalynne.com/forms/Calif LLP.pdf
California Limited Liability Company Forms
Enter the name of the limited liability company. The name must end with the words “Limited Liability Company,” or the abbreviations “LLC” or “L.L.C.” The Secretary of State will certify two copies of the filed document(s) without charge, provided that the copies are submitted to the Secretary of State with the document(s) to be filed. The fee for filing Form LLC-1 is $70.00. There is an additional $15.00 special handling fee for processing a document delivered in person to the Sacramento office. http://www.marshalynne.com/forms/Calif%20LLC.pdf
California Articles of Incorporation
The attached sample has been drafted to meet minimum statutory requirements. The sample may be used as a guide in preparing documents to be filed with the Secretary of State. The fee for filing Articles of Incorporation for a general stock corporation is $100.00. There is an additional $15.00 special handling fee for processing a document delivered in person to the Sacramento office or to any of the regional offices.
http://www.marshalynne.com/forms/Calif%20Incorporation.pdf
http://www.marshalynne.com/forms/Calif%20Incorporation.pdf
Thursday
Disaster Loan Assistance
The Small Business Association allows anyone with damages to their home or business resulting from a declared disaster to apply for disaster loan assistance. http://www.marshalynne.com/forms/SBA Disaster.pdf
Small Disadvantage Business
This form is for businesses with either an economic or social disadvantage.
http://www.marshalynne.com/forms/SBA Minority.pdf
http://www.marshalynne.com/forms/SBA Minority.pdf
Application For Small Business Loan
U.S. Small Business Association. Complete this form to apply for a business loan from the SBA. http://www.marshalynne.com/forms/SBA Loan.pdf
Application For Employer Identification Number
For use by employers, corporations, partnerships, trusts, estates, churches,
government agencies, Indian tribal entities, certain individuals, and others to apply for a Federal Employer Identification Number. http://www.marshalynne.com/forms/IRS SS4.pdf
government agencies, Indian tribal entities, certain individuals, and others to apply for a Federal Employer Identification Number. http://www.marshalynne.com/forms/IRS SS4.pdf
Request For Earnings Review
This form is used by individual wage earners to request SSA's review, and if necessary, correction of the Agency's master record of his/her earnings. http://www.marshalynne.com/forms/Earnings Correction.pdf
Housing Discrimination
Complete this form if you were refused an opportunity to rent or buy housing, denied a loan, told that housing was not available when in fact it was, or treated differently from others seeking housing. http://www.marshalynne.com/forms/Housing Discrimination.pdf
Section 8 Housing Payment Contract
This form of Housing Assistance Payments Contract is used to provide Section 8 tenant-based assistance under the housing choice voucher program of the U.S. Department of Housing and Urban Development (HUD). http://www.marshalynne.com/forms/HUD Housing.pdf
Claim For Rental or Down Payment Assistance
This claim form is for the use of families and individuals applying for rental or down payment assistance under the Uniform Relocation
Assistance and Real Property Acquisition Policies Act and may also be used by a 180-day homeowner-occupant who chooses to rent rather than buy a replacement home. http://www.marshalynne.com/forms/Rental Assistance.pdf
Assistance and Real Property Acquisition Policies Act and may also be used by a 180-day homeowner-occupant who chooses to rent rather than buy a replacement home. http://www.marshalynne.com/forms/Rental Assistance.pdf
Residential Loan Application
Department of Housing and Urban Development, Uniform Residential Loan Application. http://www.marshalynne.com/forms/Residential Loan.pdf
Discrimination Against Federal Assistance
This form assists in filing a complaint of discrimination against a recipient of federal assistance. http://www.marshalynne.com/forms/DOJ Complaint.pdf
Friday
How do foreclosures effect my credit score?
Sellers take as big a hit on their credit report by going through foreclosure as giving the lender a deed-in-lieu of foreclosure.
Points lost on a FICO score are:
Foreclosure or Deed-in-Lieu of Foreclosure
Both of these solutions affect credit the same. Sellers will take a hit of 200 to 300 points, depending on overall condition of credit. This means if a seller's FICO score before foreclosure was 680, it could dip as low as 380.
Short Sale
The effect of a short sale on a seller's credit report is identical to that of a foreclosure. The hit on your credit will show up as a pre-foreclosure in redemption status, This results in a loss of 200 to 300 points. This means a short sale with a previous FICO of 720 will see it fall from 520 to 420.
Points lost on a FICO score are:
Foreclosure or Deed-in-Lieu of Foreclosure
Both of these solutions affect credit the same. Sellers will take a hit of 200 to 300 points, depending on overall condition of credit. This means if a seller's FICO score before foreclosure was 680, it could dip as low as 380.
Short Sale
The effect of a short sale on a seller's credit report is identical to that of a foreclosure. The hit on your credit will show up as a pre-foreclosure in redemption status, This results in a loss of 200 to 300 points. This means a short sale with a previous FICO of 720 will see it fall from 520 to 420.
Should I do a short sale instead of foreclose?
Short sales happen when a lender agrees to accept less than the amount owed against the home because there is not enough equity to sell and pay all costs of sale. Not all lenders will negotiate a short sale, and that is why a real estate agent or a lawyer can be a tremendous help by contacting the lender's loss mitigation department to find out.
You can't just wake up one morning and decide you're going to sell your home at a loss by asking for a short sale. It used to be that lenders wouldn't even consider a short sale if your payments are current, but that is changing. However, realize that lenders will be more agreeable to negotiation if your payments are in arrears. Plus, if you have cash assets, the lender might try to tap those accounts.
You can't just wake up one morning and decide you're going to sell your home at a loss by asking for a short sale. It used to be that lenders wouldn't even consider a short sale if your payments are current, but that is changing. However, realize that lenders will be more agreeable to negotiation if your payments are in arrears. Plus, if you have cash assets, the lender might try to tap those accounts.
How can I stop a foreclosure?
When the lender files a Notice of Default, your options are few. That is why it is better for you to call your lender before falling behind on your payments, because lenders are often reluctant to work out repayment schedules after foreclosure proceedings have been commenced.
You will be given a certain time period to bring the payments current, pay the costs of filing the foreclosure and stop the foreclosure. This is called reinstatement of your loan. If you cannot make up the missed payments and the lender will not work with you, but try these options to stop foreclosures:
Sell Your Home.
Interview real estate agents to get an opinion of market value and average DOM to sell your home. You might be tempted to hire a discount broker, but many sellers feel they need the exposure and marketing that full-service brokers offer. Compare both to determine which best meets your needs and time frame.
Consider a Short Sale.
If your home is worth less than the amount you owe, you might be a candidate for a short sale. A short sale affects credit but it's not as bad as a foreclosure. You or your agent will need to negotiate with your lender to find out if the lender will cooperate on a short sale. This is called a pre-foreclosure redeemed.
Sign a Deed-in-Lieu of Foreclosure
This is called deeding the home back to the lender. The homeowner give the lender a properly prepared and notarized deed, and the lender forgives the mortgage, effectively canceling the foreclosure action. Lenders tell me that deeds-in-lieu of foreclosure affect credit the same as a foreclosure.
The lender might also work an arrangement where a home owner can remain in the home until finding a place to move into. Owners in default should negotiate the right to retain occupancy, arguing that if the lender followed through on the foreclosure, an owner would still enjoy the right of possession during that procedure
You will be given a certain time period to bring the payments current, pay the costs of filing the foreclosure and stop the foreclosure. This is called reinstatement of your loan. If you cannot make up the missed payments and the lender will not work with you, but try these options to stop foreclosures:
Sell Your Home.
Interview real estate agents to get an opinion of market value and average DOM to sell your home. You might be tempted to hire a discount broker, but many sellers feel they need the exposure and marketing that full-service brokers offer. Compare both to determine which best meets your needs and time frame.
Consider a Short Sale.
If your home is worth less than the amount you owe, you might be a candidate for a short sale. A short sale affects credit but it's not as bad as a foreclosure. You or your agent will need to negotiate with your lender to find out if the lender will cooperate on a short sale. This is called a pre-foreclosure redeemed.
Sign a Deed-in-Lieu of Foreclosure
This is called deeding the home back to the lender. The homeowner give the lender a properly prepared and notarized deed, and the lender forgives the mortgage, effectively canceling the foreclosure action. Lenders tell me that deeds-in-lieu of foreclosure affect credit the same as a foreclosure.
The lender might also work an arrangement where a home owner can remain in the home until finding a place to move into. Owners in default should negotiate the right to retain occupancy, arguing that if the lender followed through on the foreclosure, an owner would still enjoy the right of possession during that procedure
How can I avoid foreclosure?
The best way to avoid foreclosure is to prevent the filing of a Notice of Default. Lenders do not want to foreclose but will file a Notice of Default to protect their interests, if necessary. If you know you are unlikely to meet your mortgage obligation, the first thing you should do is call your lender.
Don't put it off, be embarrassed or ignore letters from your lender because those responses will make the situation worse, not better. Depending on your particular situation and hardship circumstances, here are some options your lender might propose to you:
Make up your payments.
Lenders might agree to wait before taking legal action against you and let you work out a repayment plan that is affordable for you. This is called forbearance.
Forgive a payment.
If you can agree on a way that you will be current after missing a payment or two (without the means to pay it back), the lender might give you a break and waive your obligation. This is called debt forgiveness, and it rarely happens.
Spread out the missed payments over a longer term.
For example, if your payment is, say, $1,200 a month, the lender might let you add $100 a month to each payment for a year until you are caught up. This is called a repayment plan.
Change the terms of your loan.
If your mortgage is an adjustable loan, the lender might freeze the interest rate before it increases or change the interest rate to a more manageable rate for you. A lender might also extend the amortization period. This is called a note modification.
Add the back payments to your loan balance.
If you have sufficient equity and meet the lender's lending guidelines, the lender might increase your loan balance to include the back payments and re-amortize the loan. This is called a refinance.
Make a separate loan.
Certain government loans contain provisions that let borrowers who meet specific criteria apply for another loan, which will pay back the missed payments. This is called a partial claim.
Don't put it off, be embarrassed or ignore letters from your lender because those responses will make the situation worse, not better. Depending on your particular situation and hardship circumstances, here are some options your lender might propose to you:
Make up your payments.
Lenders might agree to wait before taking legal action against you and let you work out a repayment plan that is affordable for you. This is called forbearance.
Forgive a payment.
If you can agree on a way that you will be current after missing a payment or two (without the means to pay it back), the lender might give you a break and waive your obligation. This is called debt forgiveness, and it rarely happens.
Spread out the missed payments over a longer term.
For example, if your payment is, say, $1,200 a month, the lender might let you add $100 a month to each payment for a year until you are caught up. This is called a repayment plan.
Change the terms of your loan.
If your mortgage is an adjustable loan, the lender might freeze the interest rate before it increases or change the interest rate to a more manageable rate for you. A lender might also extend the amortization period. This is called a note modification.
Add the back payments to your loan balance.
If you have sufficient equity and meet the lender's lending guidelines, the lender might increase your loan balance to include the back payments and re-amortize the loan. This is called a refinance.
Make a separate loan.
Certain government loans contain provisions that let borrowers who meet specific criteria apply for another loan, which will pay back the missed payments. This is called a partial claim.
Can a quitclaim deed save my home from foreclosure?
Transferring ownership of a house while facing foreclosure is almost never a good idea unless a sale or refinance of the property is also taking place. The defaulted mortgage must be paid off in full or at an agreed price in order for the foreclosure to be ended. If the homeowners are simply executing a quitclaim deed in a misguided effort to save the house from foreclosure, they will quickly realize that this does nothing to affect the original mortgage, and will only leave them in a potentially much worse situation.
If title is transferred out of the homeowners' names and the mortgage is not paid off, there is a good chance that the situation will go from bad to worse. They will no longer have control over the property, and the Due on Sale clause may push up the time frame in which they need to pay off the mortgage.
If title is transferred out of the homeowners' names and the mortgage is not paid off, there is a good chance that the situation will go from bad to worse. They will no longer have control over the property, and the Due on Sale clause may push up the time frame in which they need to pay off the mortgage.
Can a quitclaim deed stop a foreclosure?
Nothing could be further from the truth, however, and simply signing over the deed to the house to a third party will put the owners in a much more vulnerable situation than when their own names were on the title. Using a quitclaim deed or other transfer document will also do nothing to make the bank end its lawsuit to take the home.
Transferring ownership of a house in foreclosure does not relieve the original borrowers of their obligation and responsibility to pay the mortgage that is secured by the property. When they purchased the house, they promised to pay back to the bank a set amount of money at a certain interest rate, and transferring the deed will not change the fact that the house is collateral for the mortgage loan. The owners may be able to transfer ownership of the house at a later date, but their original promise to pay the bank or face the loss of the property will not be altered.
There is also a danger that transferring the title into another party's name will activate a part of the mortgage called the "Due on Sale" clause. This means that, if the homeowners transfer ownership at any time before they have paid off the mortgage in full, the entire remaining amount of the loan will be due immediately. Because most deed documents state the consideration paid for the property, banks view this as a sale of the house, even if it is only for a nominal amount like $10. Such transfers will activate the Due on Sale clause and the homeowners will still have to find a way to pay back the loan, or the house will be foreclosed and auctioned off.
Transferring ownership of a house in foreclosure does not relieve the original borrowers of their obligation and responsibility to pay the mortgage that is secured by the property. When they purchased the house, they promised to pay back to the bank a set amount of money at a certain interest rate, and transferring the deed will not change the fact that the house is collateral for the mortgage loan. The owners may be able to transfer ownership of the house at a later date, but their original promise to pay the bank or face the loss of the property will not be altered.
There is also a danger that transferring the title into another party's name will activate a part of the mortgage called the "Due on Sale" clause. This means that, if the homeowners transfer ownership at any time before they have paid off the mortgage in full, the entire remaining amount of the loan will be due immediately. Because most deed documents state the consideration paid for the property, banks view this as a sale of the house, even if it is only for a nominal amount like $10. Such transfers will activate the Due on Sale clause and the homeowners will still have to find a way to pay back the loan, or the house will be foreclosed and auctioned off.
Can a quitclaim deed transfer mortgage debt?
when you transfer property rights, a quitclaim deed serves your purpose. But you cannot transfer mortgage debt or any financial obligation through the deed. If there is a mortgage on the property you wish to transfer, you'll have to pay off the debt prior to the transfer and make the title free and clear. Otherwise, you'll have to transfer the loan as well.
In order to transfer a mortgage to the grantee, you'll have to convince the latter to refinance the loan in his/her name. And, at the time of refinance closing, you can sign on a quitclaim or grant deed in order to transfer the property to the grantee. Alternatively, you can transfer the title first and then have the grantee refinance the mortgage in his name. But before you do so, get it in writing from the grantee that he'll refinance as soon as you convey the title. Otherwise, you'll (the grantor) be left to pay off the loan entirely without having the property in your name.
Another way by which you can transfer mortgage debt while quitclaiming property is Novation.
In order to transfer a mortgage to the grantee, you'll have to convince the latter to refinance the loan in his/her name. And, at the time of refinance closing, you can sign on a quitclaim or grant deed in order to transfer the property to the grantee. Alternatively, you can transfer the title first and then have the grantee refinance the mortgage in his name. But before you do so, get it in writing from the grantee that he'll refinance as soon as you convey the title. Otherwise, you'll (the grantor) be left to pay off the loan entirely without having the property in your name.
Another way by which you can transfer mortgage debt while quitclaiming property is Novation.
Do I need to sign a Power of Attorney in front of a notary?
Yes. Your signature on the Power of Attorney must be witnessed by a Notary Public.
What is a Quit Claim Deed?
Quitclaim deeds transfer or "quit" any interest in real property. The grantor may not be in title at all, so the grantee cannot assume that the grantor has any real interest to convey. However, if the grantor were, say, married to the owner of the property, signing and recording a quitclaim deed in favor of the spouse would transfer any interest the grantor may have in the property to the spouse.
Should I file my Power of Attorney with any government office?
Not unless the Power of Attorney is used in a real estate transaction. In that case, it must be files in the County Clerk's office. And when you file in the County Clerk's office, the Power of Attorney is a public record open to inspection by the public. A writing that revokes a filed Power of Attorney should also be filed in the County Clerk's office.
How can I stop my Power of Attorney?
You may revoke your Power of Attorney at any time.
Inform your Agent, in writting, that you are revoking the Power of Attorney. Request the return of all copies of your Power of Attorney.
Notify your bank or other financial institution where your Agent has used the Power of Attorney that it has been revoked.
File a copy of the revocation with the County Clerk if your Power of Attorney has been filed in the Clerk's office.
Inform your Agent, in writting, that you are revoking the Power of Attorney. Request the return of all copies of your Power of Attorney.
Notify your bank or other financial institution where your Agent has used the Power of Attorney that it has been revoked.
File a copy of the revocation with the County Clerk if your Power of Attorney has been filed in the Clerk's office.
Who watches my Power of Attorney agent?
There is no official or government monitoring of Agents acting pursuant to Power of Attorney. That is the responsibility of the Principal. It is therefore important to insist that your Agent keep accurate records of all transactions completed for you, and to provide you with periodic accountings. You might also direct your Agent to give an accounting to a third party in the event you are unable to review the accounting yourself.
Can someone with a Power of Attorney steal my money?
Yes. A Power of Attorney can be abused, and dishonest Agents have used Powers of Attorney to transfer the Principal's assets to themselves and others. That is why it is so important to appoint an Agent who is completely trustworthy, and to require the Agent to provide complete and periodic accountings to you or to a third party.
What is the agent's duty in a Power of Attorney?
The Agent is obligated to act in the best interests of the Principal, and to avoid any "self-dealing." Self-dealing is acting to further the selfish interests of the Agent, rather than the best interest of the Principal.
An Agent appointed in a Power of Attorney is a fiduciary, with strict standards of honesty, loyalty and candor to the Principal. An Agent must safeguard the Principal's property, and keep it separate from the Agent's personal property. Money should be kept in a separate bank account for the benefit of the Principal. Agents must also keep accurate financial records of their activities, and provide complete and periodic accountings for all money and property coming into their possession.
Make clear to your Agent that you want accurate records of all transactions completed for you, and to give you periodic accountings. You can also direct your Agent to provide an accounting to a third party-a member of your family or trusted friend-in the event you are unable to review the accounting yourself.
An Agent appointed in a Power of Attorney is a fiduciary, with strict standards of honesty, loyalty and candor to the Principal. An Agent must safeguard the Principal's property, and keep it separate from the Agent's personal property. Money should be kept in a separate bank account for the benefit of the Principal. Agents must also keep accurate financial records of their activities, and provide complete and periodic accountings for all money and property coming into their possession.
Make clear to your Agent that you want accurate records of all transactions completed for you, and to give you periodic accountings. You can also direct your Agent to provide an accounting to a third party-a member of your family or trusted friend-in the event you are unable to review the accounting yourself.
Can I have more than one agent in my Power of Attorney?
Yes. You may appoint multiple Agents. If you appoint two or more Agents, you must decide whether they must act together in making decisions involving your affairs, or whether each can act separately.
There are advantages and disadvantages to both forms of appointment. Requiring your Agents to act jointly can safeguard the soundness of their decisions. On the other hand, requiring agreement of all your Agents can result in delay or inaction in the event of a disagreement among them, or the unavailability of one of them to sign legal documents.
Allowing your Agents to act separately may ensure that an Agent is always available to act for you. But it may also result in confusion and disagreements if the Agents do not communicate with one another, or if one of them believes that the other is not acting in your best interests.
There are advantages and disadvantages to both forms of appointment. Requiring your Agents to act jointly can safeguard the soundness of their decisions. On the other hand, requiring agreement of all your Agents can result in delay or inaction in the event of a disagreement among them, or the unavailability of one of them to sign legal documents.
Allowing your Agents to act separately may ensure that an Agent is always available to act for you. But it may also result in confusion and disagreements if the Agents do not communicate with one another, or if one of them believes that the other is not acting in your best interests.
Once I sign a Power of Attorney, can I still make my own decisions?
Yes. The Agent named in a Power of Attorney is your representative, not your "boss." As long as you have the legal capacity to make decisions, you can direct your Agent to do only those things that you want done.
Who should I give Power of Attorney to?
You should choose a trusted family member, a proven friend, or a professional with an outstanding reputation for honesty. Remember, signing a Power of Attorney that grants broad authority to an Agent is very much like signing a blank check.
Certainly, you should never give a Power of Attorney to someone you do not trust fully. And do not allow anyone to force you into signing a Power of Attorney.
Certainly, you should never give a Power of Attorney to someone you do not trust fully. And do not allow anyone to force you into signing a Power of Attorney.
Can a power of attorney, agent make medical decisions?
No. The proper legal instrument for delegating health-care decisions to another is called a Health care Proxy.
What legal authority is given?
Whether "Nondurable," "Durable," or "Springing," a Power of Attorney can be used to grant any, or all, of the following legal powers to an Agent:
-Buy or sell your real estate
-Manage your property
-Conduct your banking transactions
-Invest, or not invest, your money
-Make legal claims and conduct litigation
-Attend to tax and retirement matters
-Make gifts on your behalf
-Buy or sell your real estate
-Manage your property
-Conduct your banking transactions
-Invest, or not invest, your money
-Make legal claims and conduct litigation
-Attend to tax and retirement matters
-Make gifts on your behalf
What are the different types?
Yes. There are "Nondurable ," "Durable," and "Springing" Power of Attorney. A "Nondurable" Power of Attorney takes effect immediately. It remains in effect until it is revoked by the Principal, or until the Principal becomes mentally incompetent or dies.
A "Nondurable" Power of Attorney is often used for a specific transaction, like the closing on the sale of residence, or the handling of the Principal's financial affairs while the Principal is traveling outside of the country.
A "Durable" Power of Attorney enables the Agent to act for the Principal even after the Principal is not mentally competent or physically able to make decisions. The "Durable" Power of Attorney may be used immediately, and is effective until it is revoked by the Principal, or until the Principal's death.
A "Springing" Power of Attorney becomes effective at a future time. That is, it "springs up" upon the happenings of a specific event chosen by the Power of Attorney. Often that event is the illness or disability of the Principal.
The "Springing" Power of Attorney will frequently provide that the Principal's physician will determine whether the Principal is competent to handle his or her financial affairs. A "Springing" Power of Attorney remains in effect until the Principal's death, or until revoked by a court.
A "Nondurable" Power of Attorney is often used for a specific transaction, like the closing on the sale of residence, or the handling of the Principal's financial affairs while the Principal is traveling outside of the country.
A "Durable" Power of Attorney enables the Agent to act for the Principal even after the Principal is not mentally competent or physically able to make decisions. The "Durable" Power of Attorney may be used immediately, and is effective until it is revoked by the Principal, or until the Principal's death.
A "Springing" Power of Attorney becomes effective at a future time. That is, it "springs up" upon the happenings of a specific event chosen by the Power of Attorney. Often that event is the illness or disability of the Principal.
The "Springing" Power of Attorney will frequently provide that the Principal's physician will determine whether the Principal is competent to handle his or her financial affairs. A "Springing" Power of Attorney remains in effect until the Principal's death, or until revoked by a court.
What is a Power of Attorney?
A Power of Attorney is a legal instrument that is used to delegate legal authority to another. The person who signs(executes)a Power of Attorney is called the Principal. The power of Attorney gives legal authority to another person(called an Agent or Attorney-in-Fact) to make property, financial and other legal decisions for the Principal.
A Principal can give an Agent broad legal authority, or very limited authority. The Power of Attorney is frequently used to help in the event of a Principal's illness or disability, or in legal transactions where the principal cannot be present to sign necessary legal documents.
A Principal can give an Agent broad legal authority, or very limited authority. The Power of Attorney is frequently used to help in the event of a Principal's illness or disability, or in legal transactions where the principal cannot be present to sign necessary legal documents.
What are the phases in probate?
Phase One
The person requesting appointment as personal representative (executor or administrator) hires an experienced probate lawyer to prepare and file a Petition for Probate.
Phase Two
The probate lawyer, or the petitioner without a lawyer, arranges to mail notice to everyone named in the decedent’s Will (when there is a Will) and all his/her legal heirs about the death and the probate hearing.
The notice must also be published in the newspaper where the decedent lived to let creditors know about the hearing. Notice gives everyone notified an opportunity to object to admitting the Will and to the appointment of the personal representative.
Phase Three
The hearing usually takes place several weeks after the matter is filed. The purpose of the hearing is to determine the validity of the Will and to appoint the personal representative. If there are no objections, the court will approve the petition and appoint the personal representative.
Phase Four
The personal representative must identify, take possession of, and manage the probate assets until all debts have been paid and tax returns filed. This process usually takes about a year.
Depending on the terms of the Will (if there is a Will), and on the amount of the decedent's debts, the personal representative may have to sell real estate, securities or other property.
Or, if there are unpaid debts, the personal representative may have to sell some of the estate property to pay them.
Phase Five
After paying the debts and taxes, the personal representative must file a report with the court. The report accounts for all income received and payments made on behalf of the estate.
The judge will then authorize the personal representative to divide the remaining property among the people or organizations named in the Will.
Phase Six
The property will be transferred to its new owners.
The person requesting appointment as personal representative (executor or administrator) hires an experienced probate lawyer to prepare and file a Petition for Probate.
Phase Two
The probate lawyer, or the petitioner without a lawyer, arranges to mail notice to everyone named in the decedent’s Will (when there is a Will) and all his/her legal heirs about the death and the probate hearing.
The notice must also be published in the newspaper where the decedent lived to let creditors know about the hearing. Notice gives everyone notified an opportunity to object to admitting the Will and to the appointment of the personal representative.
Phase Three
The hearing usually takes place several weeks after the matter is filed. The purpose of the hearing is to determine the validity of the Will and to appoint the personal representative. If there are no objections, the court will approve the petition and appoint the personal representative.
Phase Four
The personal representative must identify, take possession of, and manage the probate assets until all debts have been paid and tax returns filed. This process usually takes about a year.
Depending on the terms of the Will (if there is a Will), and on the amount of the decedent's debts, the personal representative may have to sell real estate, securities or other property.
Or, if there are unpaid debts, the personal representative may have to sell some of the estate property to pay them.
Phase Five
After paying the debts and taxes, the personal representative must file a report with the court. The report accounts for all income received and payments made on behalf of the estate.
The judge will then authorize the personal representative to divide the remaining property among the people or organizations named in the Will.
Phase Six
The property will be transferred to its new owners.
How are taxes handled in probate?
For federal and state tax purposes, death means two things:
It marks the date of the close of the decedent's last tax year for filing an income tax return, and
It establishes a new, separate entity for tax purposes, the "estate."
For federal taxes, you may have to fill out and file one or more of the following forms. (It depends on the decedent's income, the size of the estate, and the income of the estate):
-Final Form 1040 Federal Income Tax return (the decedent's personal income tax return)
-Form 1041 Federal Fiduciary Income Tax returns for the estate
-Form 709 Federal Gift Tax return(s)
-Form 706 Federal Estate Tax return
For California taxes, the executor must file any needed state income tax return, state fiduciary income tax returns during the probate period, estate tax and gift tax returns.
There may be other taxes, too, like local real estate and personal property taxes, business taxes, and any special state taxes. The executor must also check for taxes owed for years prior to the decedent's death.
It marks the date of the close of the decedent's last tax year for filing an income tax return, and
It establishes a new, separate entity for tax purposes, the "estate."
For federal taxes, you may have to fill out and file one or more of the following forms. (It depends on the decedent's income, the size of the estate, and the income of the estate):
-Final Form 1040 Federal Income Tax return (the decedent's personal income tax return)
-Form 1041 Federal Fiduciary Income Tax returns for the estate
-Form 709 Federal Gift Tax return(s)
-Form 706 Federal Estate Tax return
For California taxes, the executor must file any needed state income tax return, state fiduciary income tax returns during the probate period, estate tax and gift tax returns.
There may be other taxes, too, like local real estate and personal property taxes, business taxes, and any special state taxes. The executor must also check for taxes owed for years prior to the decedent's death.
If I am the beneficiary, do I have to pay bills?
Generally, no. The law says you cannot be made responsible for others’ general debts without your consent.
Unless the decedent gave away his or her assets to someone shortly before dying, or otherwise acted in concert with them to defraud the creditors, the beneficiaries should not have to pay the creditors just because they are beneficiaries.
There may be nothing left in the estate for the beneficiaries after paying the creditors. But, the beneficiaries will not owe the creditors money.
Still, if the children or beneficiaries took property or benefits from the decedent or the estate, or assumed liability for care given the decedent, or guaranteed payment, they can be liable for some or all of the decedent's debts separately.
Unless the decedent gave away his or her assets to someone shortly before dying, or otherwise acted in concert with them to defraud the creditors, the beneficiaries should not have to pay the creditors just because they are beneficiaries.
There may be nothing left in the estate for the beneficiaries after paying the creditors. But, the beneficiaries will not owe the creditors money.
Still, if the children or beneficiaries took property or benefits from the decedent or the estate, or assumed liability for care given the decedent, or guaranteed payment, they can be liable for some or all of the decedent's debts separately.
How do bills get paid in probate?
Part of the probate process is to notify creditors of the death. Notice requirements vary. In some cases, you must provide direct notice. In others, you must publish a notice in a newspaper in the city where the decedent lived.
Creditors must file a claim with the court for the amounts due within a fixed period of time. If the executor approves the claim, the bill is paid out of the estate. If the executor rejects the claim, the creditor must sue for payment.
If there is not enough money to pay all debts, state law determines who gets paid first. The personal representative most likely will sell property to pay approved creditor claims.
Creditors must file a claim with the court for the amounts due within a fixed period of time. If the executor approves the claim, the bill is paid out of the estate. If the executor rejects the claim, the creditor must sue for payment.
If there is not enough money to pay all debts, state law determines who gets paid first. The personal representative most likely will sell property to pay approved creditor claims.
What if no will exist?
If a person dies without a Will (known as dying "intestate"), the probate court appoints a personal representative (known as an "administrator").
The major difference between dying testate and dying intestate is that an intestate estate is distributed according to state law (known as "intestate succession"). A testate estate is distributed according to the instructions left by the decedent in his or her Will.
The major difference between dying testate and dying intestate is that an intestate estate is distributed according to state law (known as "intestate succession"). A testate estate is distributed according to the instructions left by the decedent in his or her Will.
What happens if a will cannot be found?
If a Will is lost or can’t be found, the specific facts and circumstances and state law will determine what happens.
For instance, if the Will is missing because the decedent intentionally revoked it, an earlier Will or the laws on intestate succession would determine who gets the decedent's estate.
Or, if a Will is missing because it was stored in a bank vault destroyed in a fire, the probate court may accept a photocopy of the Will (or the lawyer's draft or computer file), if there is evidence that the decedent properly signed the original.
For instance, if the Will is missing because the decedent intentionally revoked it, an earlier Will or the laws on intestate succession would determine who gets the decedent's estate.
Or, if a Will is missing because it was stored in a bank vault destroyed in a fire, the probate court may accept a photocopy of the Will (or the lawyer's draft or computer file), if there is evidence that the decedent properly signed the original.
Do I have to use a lawyer for probate?
No. But, it may be a good idea if the estate is complex. A lawyer can help you meet all deadlines and avoid mistakes and delays.
A lawyer can sometimes help avoid disagreements among family members over minor or major issues. But the lawyer represents the interests of the personal representative, not the beneficiaries.
You may not need a lawyer if:
-you are the sole beneficiary,
-the decedent's property consists of common assets (like house, bank accounts, insurance, etc.)
-the Will is simple and straightforward, and
-you have access to good Self Service materials.
In most cases, the personal representative may never see the inside of a courtroom. But, she/he will have to go to the Court Clerk's office.
A lawyer can sometimes help avoid disagreements among family members over minor or major issues. But the lawyer represents the interests of the personal representative, not the beneficiaries.
You may not need a lawyer if:
-you are the sole beneficiary,
-the decedent's property consists of common assets (like house, bank accounts, insurance, etc.)
-the Will is simple and straightforward, and
-you have access to good Self Service materials.
In most cases, the personal representative may never see the inside of a courtroom. But, she/he will have to go to the Court Clerk's office.
How long does probate take?
California law says the personal representative must complete probate within one year from the date of appointment, unless s/he files a federal estate tax. In this case, the personal representative can have 18 months to complete probate.
If probate has not been completed by that time, the personal representative must file a status report to the court to explain what still has to be done and how much time that will take.
If the personal representative does not report to the court, the beneficiaries can ask the court to order him or her to file an accounting or take other actions to close probate. The court can remove the personal representative and appoint someone else.
Sometimes there are circumstances that can make probate take longer. If there is a Will contest (a claim filed with the court that all or part of the will is not valid), or the size and complexity of the estate requires extra time, or it is hard to find beneficiaries, the process can drag out. Some probate cases take years to resolve.
If probate has not been completed by that time, the personal representative must file a status report to the court to explain what still has to be done and how much time that will take.
If the personal representative does not report to the court, the beneficiaries can ask the court to order him or her to file an accounting or take other actions to close probate. The court can remove the personal representative and appoint someone else.
Sometimes there are circumstances that can make probate take longer. If there is a Will contest (a claim filed with the court that all or part of the will is not valid), or the size and complexity of the estate requires extra time, or it is hard to find beneficiaries, the process can drag out. Some probate cases take years to resolve.
Do living trust go through probate?
No. When a living trust holds title to some of the decedent's property, that property also passes to the beneficiaries without probate.
Do life insurance and retirement accounts go through probate?
No. The benefits can be paid directly to a named beneficiary. Money from IRAs, Keoghs, and 401(k) accounts transfer automatically to the persons named as beneficiaries. Bank accounts that are set up as pay-on-death accounts (PODs) or "in trust for" accounts (a "Totten Trust") with a named beneficiary also pass to the beneficiary without probate.
When should I go through probate?
Probate makes sense only if your estate will have complicated problems, such as many debts that can't easily be paid from the property you leave.
Whether to spend your time and effort planning to avoid probate depends on a number of factors, most notably your age, your health, and your wealth. If you're young and in good health, adopting a complex probate-avoidance plan now may mean you'll have to re-do it as your life situation changes.
Whether to spend your time and effort planning to avoid probate depends on a number of factors, most notably your age, your health, and your wealth. If you're young and in good health, adopting a complex probate-avoidance plan now may mean you'll have to re-do it as your life situation changes.
Who handles probate?
If there isn't any will, or the will fails to name an executor, the probate court names someone like and administrator to handle the process. Most often, the job goes to the closest capable relative or the person who inherits the bulk of the deceased person's assets.
If no formal probate proceeding is necessary, the court does not appoint an estate administrator. Instead, a close relative or friend serves as an informal estate representative.
If no formal probate proceeding is necessary, the court does not appoint an estate administrator. Instead, a close relative or friend serves as an informal estate representative.
Does all property have to go through probate?
No. Most states allow a certain amount of property to pass free of probate or through a simplified probate procedure. In California, for example, you can pass up to $100,000 of property without probate, and there's a simple transfer procedure for any property left to a surviving spouse.
In addition, property that passes outside of your will -- say, through joint tenancy or a living trust -- is not subject to probate.
In addition, property that passes outside of your will -- say, through joint tenancy or a living trust -- is not subject to probate.
How does probate work?
After your death, the person you named in your will as executor -- or, if you die without a will, the person appointed by a judge -- files papers in the local probate court. The executor proves the validity of your will and presents the court with lists of your property, your debts, and who is to inherit what you've left. Then, relatives and creditors are officially notified of your death.
Your executor must find, secure, and manage your assets during the probate process, which commonly takes a few months to a year. Depending on the contents of your will, and on the amount of your debts, the executor may have to decide whether or not to sell your real estate, securities, or other property. For example, if your will makes a number of cash bequests but your estate consists mostly of valuable artwork, your collection might have to be appraised and sold to produce cash. Or, if you have many outstanding debts, your executor might have to sell some of your property to pay them.
In most states, immediate family members may ask the court to release short-term support funds while the probate proceedings lumber on. Then, eventually, the court will grant your executor permission to pay your debts and taxes and divide the rest among the people or organizations named in your will. Finally, your property will be transferred to its new owners.
Your executor must find, secure, and manage your assets during the probate process, which commonly takes a few months to a year. Depending on the contents of your will, and on the amount of your debts, the executor may have to decide whether or not to sell your real estate, securities, or other property. For example, if your will makes a number of cash bequests but your estate consists mostly of valuable artwork, your collection might have to be appraised and sold to produce cash. Or, if you have many outstanding debts, your executor might have to sell some of your property to pay them.
In most states, immediate family members may ask the court to release short-term support funds while the probate proceedings lumber on. Then, eventually, the court will grant your executor permission to pay your debts and taxes and divide the rest among the people or organizations named in your will. Finally, your property will be transferred to its new owners.
What is Probate?
Probate is a legal process that takes place after someone dies. It includes:
-proving in court that a deceased person's will is valid (usually a routine matter)
-identifying and inventorying the deceased person's property
-having the property appraised
-paying debts and taxes, and
-distributing the remaining property as the will (or state law, if there's no will) directs.
Typically, probate involves paperwork and court appearances by lawyers. The lawyers and court fees are paid from estate property, which would otherwise go to the people who inherit the deceased person's property.
-proving in court that a deceased person's will is valid (usually a routine matter)
-identifying and inventorying the deceased person's property
-having the property appraised
-paying debts and taxes, and
-distributing the remaining property as the will (or state law, if there's no will) directs.
Typically, probate involves paperwork and court appearances by lawyers. The lawyers and court fees are paid from estate property, which would otherwise go to the people who inherit the deceased person's property.
Saturday
I don't have anything, what can they legally do to me?
Surprisingly, the best approach for some people deeply in debt is to take no action at all. If you're living simply, with little income and no property, and look forward to a similar life in the future, you may be what's known as "judgment proof."
This means that anyone who sues you and obtains a court judgment won't be able to collect from you simply because you don't have anything they can legally take. Except in unusual situations you can't be thrown in jail for not paying your debts. Nor can a creditor take away such essentials as basic clothing, ordinary household furnishings, personal effects, food, or Social Security, unemployment, or public assistance benefits.
The key here is to grasp the knowledge, become more aware of the changes and policies that are being imposed on you, decide for yourself what is best for you, and take control of your future.
This means that anyone who sues you and obtains a court judgment won't be able to collect from you simply because you don't have anything they can legally take. Except in unusual situations you can't be thrown in jail for not paying your debts. Nor can a creditor take away such essentials as basic clothing, ordinary household furnishings, personal effects, food, or Social Security, unemployment, or public assistance benefits.
The key here is to grasp the knowledge, become more aware of the changes and policies that are being imposed on you, decide for yourself what is best for you, and take control of your future.
How do I get out of credit card debt?
Always pay the mortgage first and keep it current. Same with the car loan. Go on a cash diet. Create a allowance for yourself. From each check, set aside an amount of cash to cover everything you have to do for that period. Change credit-card companies.
Make a budget. What credit counselors advise their clients to do is look through all their bills. Look at secured debts such as your home and your car. Then look at the essentials: power, phone, groceries, insurance, etc. Take out your credit card statements to see what you owe on each and the interest rate. Finally, look at the items you want, but don't really need like cable television, gym memberships, dinners out, clothing.
Once you have an idea of what your monthly expenses really are, look for ways to cut. The first two areas are essential and everything else like your gym membership, dinners out and different pairs of sneakers for walking, running, driving, and for standing is negotiable.
Make a budget. What credit counselors advise their clients to do is look through all their bills. Look at secured debts such as your home and your car. Then look at the essentials: power, phone, groceries, insurance, etc. Take out your credit card statements to see what you owe on each and the interest rate. Finally, look at the items you want, but don't really need like cable television, gym memberships, dinners out, clothing.
Once you have an idea of what your monthly expenses really are, look for ways to cut. The first two areas are essential and everything else like your gym membership, dinners out and different pairs of sneakers for walking, running, driving, and for standing is negotiable.
Should I use my 401k or IRA to pay late bills?
If you can avoid it, do not use your retirement assets to pay bills.
One mistake people make to prolong having to file for bankruptcy protection is to use the funds that are shielded from creditors in bankruptcies, such as IRAs, pension funds and 401(k)s. Many people have borrowed against their 401(k) or maxed out the equity in their home and have had to file a bankruptcy anyway.
Unfortunately they have spent the assets that are protected in the proceedings and would have given them a fresh start. Borrow from your retirement nest egg only as a last resort.
One mistake people make to prolong having to file for bankruptcy protection is to use the funds that are shielded from creditors in bankruptcies, such as IRAs, pension funds and 401(k)s. Many people have borrowed against their 401(k) or maxed out the equity in their home and have had to file a bankruptcy anyway.
Unfortunately they have spent the assets that are protected in the proceedings and would have given them a fresh start. Borrow from your retirement nest egg only as a last resort.
Can creditors contact my friends and family members?
If your main concern is that creditors are harassing you remember that collectors cannot…contact your friends & other third parties, except for your attorney, a credit reporting bureau or the original creditor, and only for the limited purpose of finding information about where you are.
Collectors can contact your spouse, your parents if you are a minor and your co-debtors unless you have asked them in writing to stop contacting you. Collectors cannot call you repeatedly or contact you before an unreasonable time. The law presumes that before 8 a.m. or after 9 p.m. is unreasonable.
They cannot contact you at work if your employer prohibits it, use or threaten to use violence, use obscene or profane language, place calls to you without identifying themselves as bill collectors, claim that you owe more than you do, claim to be attorneys if they're not, claim that you'll be imprisoned or your property will be seized, send you papers that resemble legal documents, and they collectors cannot add unauthorized interest, fees or charges to what you owe.
Collectors can contact your spouse, your parents if you are a minor and your co-debtors unless you have asked them in writing to stop contacting you. Collectors cannot call you repeatedly or contact you before an unreasonable time. The law presumes that before 8 a.m. or after 9 p.m. is unreasonable.
They cannot contact you at work if your employer prohibits it, use or threaten to use violence, use obscene or profane language, place calls to you without identifying themselves as bill collectors, claim that you owe more than you do, claim to be attorneys if they're not, claim that you'll be imprisoned or your property will be seized, send you papers that resemble legal documents, and they collectors cannot add unauthorized interest, fees or charges to what you owe.
If I file bankruptcy, can I ever get another credit card?
You as a consumer are being encouraged to take on more debt than ever before. Do you think filing a bankruptcy will stop these companies from pursuing you?
On the contrary, you will find another offer for more credit cards in your mailbox sooner than you think. These companies are more willing to give you new cards because they assume now that you have filed for bankruptcy you have more money. It’s easier for credit card companies to put you in bankruptcy and then start you all over again.
On the contrary, you will find another offer for more credit cards in your mailbox sooner than you think. These companies are more willing to give you new cards because they assume now that you have filed for bankruptcy you have more money. It’s easier for credit card companies to put you in bankruptcy and then start you all over again.
Is bankruptcy counseling required by law?
Before filing for bankruptcy most applicants must now undergo credit counseling in a government-approved program. The purpose of this counseling is to give you an idea of whether you really need to file for bankruptcy or whether an informal repayment plan would get you back on your economic feet.
After the conclusion of bankruptcy proceedings, but before any debt can be discharged, bankruptcy filers must participate in a government-approved financial management education program. It’s mandatory. Counseling is required even if it's obvious that a repayment plan isn't feasible or you are facing debts that you find unfair and don't want to pay. You are required only to participate, not to go along with any repayment plan the agency proposes.
If the program comes up with a repayment plan, you will have to submit it to the court, along with a certificate showing that you completed the counseling, before you can file for bankruptcy. Once your bankruptcy case is over, you'll have to attend another counseling session, this time to learn personal financial management.
After the conclusion of bankruptcy proceedings, but before any debt can be discharged, bankruptcy filers must participate in a government-approved financial management education program. It’s mandatory. Counseling is required even if it's obvious that a repayment plan isn't feasible or you are facing debts that you find unfair and don't want to pay. You are required only to participate, not to go along with any repayment plan the agency proposes.
If the program comes up with a repayment plan, you will have to submit it to the court, along with a certificate showing that you completed the counseling, before you can file for bankruptcy. Once your bankruptcy case is over, you'll have to attend another counseling session, this time to learn personal financial management.
Should I file bankruptcy to get creditors off my back?
If creditors are harassing you, bankruptcy is not necessarily the best way to stop them. The whole intent of a collection agency is to work on your conscious by any means necessary. They will employ every tactic they can dream up, while they have you on the phone. Whether it’s making you feel guilty for being in your situation, by telling you that you’re unfit to be an American or that your lazy and a burden on society.
They may also contact your place of employment and hint to your co-workers that you are a bad person. I have heard of instances where collection agencies have suggested that debtors take on menial and demeaning tasks such as scraping gum off of buildings for pennies.
And know matter what they tell you on the phone or how much they threaten, they have already cut your credit score down to your shoe size. So there's not much more they can do. You can't get water from a rock!
They may also contact your place of employment and hint to your co-workers that you are a bad person. I have heard of instances where collection agencies have suggested that debtors take on menial and demeaning tasks such as scraping gum off of buildings for pennies.
And know matter what they tell you on the phone or how much they threaten, they have already cut your credit score down to your shoe size. So there's not much more they can do. You can't get water from a rock!
Can a bankruptcy stop a foreclosure?
Though bankruptcy can delay a foreclosure, a Chapter 7 liquidation won't stop it for long. Chapter 13, however, was designed with foreclosure problems in mind. A typical foreclosure scenario is where, because payments have been missed, the lender demands immediate payment of a huge sum of money -- perhaps the entire loan amount -- and there is no way you can come up with it.
Filing for Chapter 13 bankruptcy will stop the foreclosure and can force the lender to accept a plan where you make up the missed payments and the loan amount through monthly payments over the next three to five years. To make this plan work, you must be able to demonstrate that you will have enough income in the future to support such a repayment plan.
Filing for Chapter 13 bankruptcy will stop the foreclosure and can force the lender to accept a plan where you make up the missed payments and the loan amount through monthly payments over the next three to five years. To make this plan work, you must be able to demonstrate that you will have enough income in the future to support such a repayment plan.
The phone call I got from a collection agency..
I can remember some time ago being harassed by a debt collector. First it started with these letters that had urgent stamped in red on the envelope. And inside would be this short memo that read, did you misplace pay your bill?
Did you forget to send in your check? After three months of that I started receiving these phone calls from a very concerned billing clerk, who said, hello Sue? It’s Melanie. I just called to verify your billing address and by the way are you still working at the same company and is their phone number still 555-1223 and do you still bank at …? We’re having trouble with our computer system and I just want to verify all of your information again. This is normal. It’s just routine.
Less than an hour after I hung up the phone, someone a little less pleasant called. He didn’t start with hello, he began with, Sue you ought to be ashamed of yourself. You are the only women in this country that doesn’t pay her bills on time. How does that make you feel? To be so irresponsible? I’d like to know what you are going to do about this problem you’ve created? I know you at least have 100 dollars you can give me today, right? You can sell some of that stuff in there.
I started to look around the room. Can this guy see me?
Did you forget to send in your check? After three months of that I started receiving these phone calls from a very concerned billing clerk, who said, hello Sue? It’s Melanie. I just called to verify your billing address and by the way are you still working at the same company and is their phone number still 555-1223 and do you still bank at …? We’re having trouble with our computer system and I just want to verify all of your information again. This is normal. It’s just routine.
Less than an hour after I hung up the phone, someone a little less pleasant called. He didn’t start with hello, he began with, Sue you ought to be ashamed of yourself. You are the only women in this country that doesn’t pay her bills on time. How does that make you feel? To be so irresponsible? I’d like to know what you are going to do about this problem you’ve created? I know you at least have 100 dollars you can give me today, right? You can sell some of that stuff in there.
I started to look around the room. Can this guy see me?
Should I file if I have no income or property?
If you don't anticipate having a steady income or some property that a creditor could take, bankruptcy is probably not necessary. If you don’t have a full-time job or own a home, your creditors probably won't sue you. Why? Because it's unlikely they could collect the judgment from you. Instead, they’ll write off your debt and treat it as a business loss for their income tax purposes. In a few years, your debt will become legally uncollectible anyway.
Will a bankruptcy eliminate property liens?
A bankruptcy court's discharge of your debts wipes out your obligation to pay your creditors, but if the creditor has a lien on your property, the lien will survive your bankruptcy unless you exercise certain procedures during your bankruptcy case. If your creditor has taken you to court and slapped a judgment lien on your property, you may be able to remove it.
A bankruptcy eliminates debts, but it does not eliminate liens. So, if you have a secured debt, a debt where the creditor has a lien on your property and can repossess it if you don't pay the debt, bankruptcy can eliminate the debt, but it does not prevent the creditor from repossessing the property. A bankruptcy eliminates debts, but it does not eliminate liens. But if they do repossess your property, bankruptcy does prevent the creditor from coming after you for additional money. Creditors will usually come back after you if the sale of your property didn’t generate enough cash to pay off the amount you still owe them. Or if you figure out a way to keep the bidding down when you see your property on ebay.
A bankruptcy eliminates debts, but it does not eliminate liens. So, if you have a secured debt, a debt where the creditor has a lien on your property and can repossess it if you don't pay the debt, bankruptcy can eliminate the debt, but it does not prevent the creditor from repossessing the property. A bankruptcy eliminates debts, but it does not eliminate liens. But if they do repossess your property, bankruptcy does prevent the creditor from coming after you for additional money. Creditors will usually come back after you if the sale of your property didn’t generate enough cash to pay off the amount you still owe them. Or if you figure out a way to keep the bidding down when you see your property on ebay.
What's not protected in a bankruptcy?
Under the new bankruptcy law many protections have been eliminated. Most taxes that you owe, some credit card debt and student loans, are not covered by the new law. And if they are covered, the new bankruptcy law makes it harder to qualify.
For example, filing for bankruptcy no longer delays or stops eviction actions, driver's license suspensions, legal actions for child support, or divorce proceedings. Child support and alimony take priority over any other creditor.
Child support and alimony obligations will survive your bankruptcy -- you will continue to owe these debts in full, just as if you had never filed for bankruptcy. In addition, some types of debts cannot be claimed if your creditor convinces a judge that they should survive your bankruptcy.
For example, filing for bankruptcy no longer delays or stops eviction actions, driver's license suspensions, legal actions for child support, or divorce proceedings. Child support and alimony take priority over any other creditor.
Child support and alimony obligations will survive your bankruptcy -- you will continue to owe these debts in full, just as if you had never filed for bankruptcy. In addition, some types of debts cannot be claimed if your creditor convinces a judge that they should survive your bankruptcy.
Why are minimum payments so low, and get lower?
Have you noticed that the minimum payment on your statements gets lower and lower over time? If you pay less each month then you’ll probably charge more. That’s what they are counting on. Banks want you to have no worries about carrying a larger balance. Making the minimum monthly payment is what they want to be your only concern. If the time and the total amount it would take you to pay off the balance of your credit card was printed on the front of your statement each month, would you pay more than the minimum balance due?
There are 90 million Americans who don’t pay off their balances every month. Banks are making more money in late fees, over-the-limit fees and return check fees than they are from the interest payments. How? For several reasons. Some companies will go so far as to set your payment date on a Sunday or a holiday. Hoping that you will forget to send it in.
There are 90 million Americans who don’t pay off their balances every month. Banks are making more money in late fees, over-the-limit fees and return check fees than they are from the interest payments. How? For several reasons. Some companies will go so far as to set your payment date on a Sunday or a holiday. Hoping that you will forget to send it in.
How do other bills increase my credit card interest rate?
Have you ever been late on some other bill and your credit card rate still went up?
What do your other bills have to do with your credit card bills? The next time you review your credit card statement look for the term Universal Default. Universal default. If you miss any payment with another creditor, you will be in deefault of your credit card contract. Universal Default also says that you can be in dee fault if your balances with other creditors are too high.
What do your other bills have to do with your credit card bills? The next time you review your credit card statement look for the term Universal Default. Universal default. If you miss any payment with another creditor, you will be in deefault of your credit card contract. Universal Default also says that you can be in dee fault if your balances with other creditors are too high.
How can I increase my credit score?
How can you increase your credit score? Paying off your credit card debt in full each month does not make your credit rating go up. Paying off an old debt, can actually make your score go down. Closing credit cards can also make your score go down. Why? Because by closing your credit cards, you reduce your debt to equity rating.
If you have 3 credit cards each with a 10000 dollar credit limit and I didn’t owe any money on them and I close 2 cards, my equity is reduced from 30000 dollars to 10000. My choice should have been to keep those credit cards open, with no balance, to keep my debt to equity ratio high. Can you see that having credit but with little or no balance owed, is actually a plus.
If you have 3 credit cards each with a 10000 dollar credit limit and I didn’t owe any money on them and I close 2 cards, my equity is reduced from 30000 dollars to 10000. My choice should have been to keep those credit cards open, with no balance, to keep my debt to equity ratio high. Can you see that having credit but with little or no balance owed, is actually a plus.
Under Chapter 13, how much money will I have left?
Under the old rules, people who filed under Chapter 13 had to devote all of their disposable income -- what they had left after paying their actual living expenses -- to their repayment plan. The new law adds a wrinkle. Although Chapter 13 filers still have to hand over all of their disposable income, they have to calculate their disposable income using expense amounts dictated by the IRS -- not their actual expenses. That is.. if their income is higher than the median in their state.
These IRS expense amounts are often lower than actual expense. What's worse, these allowed expense amounts must be subtracted not from your actual earnings each month, but from your average income during the six months before you filed. This means that you may be required to pay a much larger amount of "disposable income" into your plan than you have to spare every month. Certainly, this stipulation will lead to more Chapter 13 failures.
These IRS expense amounts are often lower than actual expense. What's worse, these allowed expense amounts must be subtracted not from your actual earnings each month, but from your average income during the six months before you filed. This means that you may be required to pay a much larger amount of "disposable income" into your plan than you have to spare every month. Certainly, this stipulation will lead to more Chapter 13 failures.
How is Chapter 13 different from Chapter 7?
Chapter 13 is often preferable to chapter 7 because it enables you to keep a valuable asset, such as a house. It is also favored because it allows you to create a “plan” to repay creditors over three to five years. Under chapter 13 you must make payments to creditors, through the court trustee, based on your anticipated income over the period specified in your debt repayment plan. You are protected from lawsuits, garnishments, and other creditor actions while the plan is in effect.
Isn't there some income test for bankruptcy filers?
According to the IRS, if your income is less than or equal to the median income in your state, for a family of your size, you can file for Chapter 7 total liquidation. But what if your income is more than the median income in your state? The IRS has created a test called the “means test” to figure out whether you really should be making payments on a Chapter 13 plan. If your income is enough after you subtract certain expenses the IRS allows and debt payments they will require you pay, then you will be forced into a Chapter 13 plan.
What happens to my property during a bankruptcy?
It used to be that in a Chapter 7 you could list the value of your property for what it would sell for at an auction. What it would sell for was left up to your own interpretation. Those who were smart, would list their used furniture, cars, antiques, and other property they wanted to keep, with little or no value. Because it was listed as little or no value that property became "exempt property" and could not be taken by creditors or the court trustee. This enabled files to keep most of which they already had.
Now, the courts won’t ask you ..how much do you think your property is worth. The trustee will expect you to specify the cost to purchase it. Not sell it at an auction. Taking into account the property's age and condition of course. At an auction, your used dining room set would sell for little or nothing. But if you were to go into a store and purchase that same used dining room set, it could go for three times as much. This is what the court trustee is hoping for. With this new law the courts look at the purchase price as opposed to the amount you’d get at a fire sale or an auction. Hence, the trustee can raise the value placed on your property, which means more filers will have their property taken and sold by the court trustee to pay off the creditors.
Now, the courts won’t ask you ..how much do you think your property is worth. The trustee will expect you to specify the cost to purchase it. Not sell it at an auction. Taking into account the property's age and condition of course. At an auction, your used dining room set would sell for little or nothing. But if you were to go into a store and purchase that same used dining room set, it could go for three times as much. This is what the court trustee is hoping for. With this new law the courts look at the purchase price as opposed to the amount you’d get at a fire sale or an auction. Hence, the trustee can raise the value placed on your property, which means more filers will have their property taken and sold by the court trustee to pay off the creditors.
Why does it cost so much to file bankruptcy?
What’s very noticeable has been the surge in legal costs. Attorney’s fees to file a bankruptcy have sky rocketed. Now your attorney must personally vouch for the accuracy of every piece of the information you provide them. Every document, every account number and every dollar and every cent must be verified by your attorney. These new requirements, make it tougher to find an attorney to represent your case.
If I owe taxes can I file for bankruptcy protection?
Under the new bankruptcy law, if you want to file Chapter 7 or Chapter 13 you must show proof of your income by providing federal tax returns from the last tax year. If you owe taxes and have not paid taxes for the previous tax year, you must do so before the bankruptcy will go through.
What is a chapter 7 bankruptcy?
A chapter 7 bankruptcy or liquidation, is a court-supervised procedure where a trustee collects your assets, reduces them to cash, and pays your creditors.
Do Insurance companies look at my credit scores?
Insurance companies are using studies that lead them to believe that the lower your credit score, the more likely you will get into an accident and therefore your premium should be higher.
What is a secured credit card?
If you have unfavorable credit, you may be asked to apply for a secured credit card from your bank or credit union. To protect the bank against a potential default, they will ask you to deposit money with the bank or institution issuing the credit card. Be informed of the following:
There will be many more fees, such as application, processing and annual fees charged versus an unsecured credit card
The amount that you will have to deposit to secure the card can range from $200 to $5,000.
You cannot withdraw your security deposit as long as you use the card.
Even though you may deposit, $500 as security, the amount that you can charge with your credit card may not equal $500. In some cases, the amount that you can charge may be 50% less ($250) of your deposit.
There will be many more fees, such as application, processing and annual fees charged versus an unsecured credit card
The amount that you will have to deposit to secure the card can range from $200 to $5,000.
You cannot withdraw your security deposit as long as you use the card.
Even though you may deposit, $500 as security, the amount that you can charge with your credit card may not equal $500. In some cases, the amount that you can charge may be 50% less ($250) of your deposit.
How can I stop bill collector harrassment?
If you are being harassed by phone calls from collection agencies, creditors or other bill collectors send them a cease or a stop contact letter by certified mail. Do not give out your social security number, place of employment, bank account number, or information of other family members. If they offer to take a personal check from you and hold it for 30 days or more, do not agree.
The collection agency is under no obligation to be truthful with you.
Their sole purpose is to separate you from your money.
A bill collector may not contact any third parties about your debt except your lawyer, credit bureaus, and those who might help the agency locate you. If a collector does contact someone else to help locate you, he or she cannot indicate that debt collection, or your debt, is the reason for the call. Contact can be made only during normal hours. You cannot be called before 8 am and after 6 pm. Nor can a collector call you repeatedly just to annoy or intimidate you.
The collection agency is under no obligation to be truthful with you.
Their sole purpose is to separate you from your money.
A bill collector may not contact any third parties about your debt except your lawyer, credit bureaus, and those who might help the agency locate you. If a collector does contact someone else to help locate you, he or she cannot indicate that debt collection, or your debt, is the reason for the call. Contact can be made only during normal hours. You cannot be called before 8 am and after 6 pm. Nor can a collector call you repeatedly just to annoy or intimidate you.
What are Collection Agencies?
If you miss more than a few payments, often creditors will ask for the full balance of the loan or debt to be paid immediately. The creditor has the right to do this if your loan agreement contains an "acceleration clause." If you immediately bring the payments up to date, the creditor may then decide not to insist that you pay the rest at once.
But when you do not respond with a payment, the creditor may threaten to turn the matter over to a collection agency, a business that collects debts for others. Often collection agencies work on commission, collecting between 30% to 60% of the amount they collect from you. You can expect debt collectors to use high-pressure tactics to collect a debt, although the Fair Debt Collection Practices Act (FDCPA) protects consumers from unnecessary harassment and offensive strong-arm tactics. The act-which applies only to debt collectors, not creditors-makes very clear what a collection agency, may not try its efforts to get you to pay.
But when you do not respond with a payment, the creditor may threaten to turn the matter over to a collection agency, a business that collects debts for others. Often collection agencies work on commission, collecting between 30% to 60% of the amount they collect from you. You can expect debt collectors to use high-pressure tactics to collect a debt, although the Fair Debt Collection Practices Act (FDCPA) protects consumers from unnecessary harassment and offensive strong-arm tactics. The act-which applies only to debt collectors, not creditors-makes very clear what a collection agency, may not try its efforts to get you to pay.
How can I clean up my credit?
Clearing unfavorable credit history usually takes a few years and a good strategy. First review your credit report and clear any inaccurate information. Have the credit reporting companies remove any “paid in full” accounts. Pay off any accounts that are in arrears. Ask the creditor to remove all negative information from your credit file in exchange for a check for the outstanding balance.
Apply for and open new credit accounts only as needed. Don't open accounts just to have a better credit mix - it probably won't raise your score.
Have credit cards - but manage them responsibly. In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.
Note that closing an account doesn't make it go away. A closed account will still show up on your credit report, and may be considered by the score.
Re-establish your credit history if you have had problems. Opening new accounts responsibly and paying them off on time will raise your score in the long term.
If you have been managing credit for a short time, don't open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you don't have a lot of other credit information.
Keep balances low on credit cards and other "revolving credit". High outstanding debt can affect a score.
Pay off debt rather than moving it around. The most effective way to improve your score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.
Don't close unused credit cards as a short-term strategy to raise your score.
Don't open a number of new credit cards that you don't need, just to increase your available credit. This approach could backfire and actually lower score.
Apply for and open new credit accounts only as needed. Don't open accounts just to have a better credit mix - it probably won't raise your score.
Have credit cards - but manage them responsibly. In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.
Note that closing an account doesn't make it go away. A closed account will still show up on your credit report, and may be considered by the score.
Re-establish your credit history if you have had problems. Opening new accounts responsibly and paying them off on time will raise your score in the long term.
If you have been managing credit for a short time, don't open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you don't have a lot of other credit information.
Keep balances low on credit cards and other "revolving credit". High outstanding debt can affect a score.
Pay off debt rather than moving it around. The most effective way to improve your score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.
Don't close unused credit cards as a short-term strategy to raise your score.
Don't open a number of new credit cards that you don't need, just to increase your available credit. This approach could backfire and actually lower score.
How can I delete stuff on my credit reports?
Federal law requires credit reporting companies to delete any information that is outdated, inaccurate, unverifiable or misleading when it is brought to their attention. If your investigation of your credit results in a change or a deletion of the information contained within your report, you can request that Equifax send your revised credit file to any person or entity that received your credit report in the past 6 months for any purpose. For employment purposes, the length of time is 2 years.
Credit bureaus are legally required to investigate and correct wrong information, however, you have to point the error out to them.
Write a letter and describe the error and request an investigation. Send the letter by certified mail and return receipt requested to have proof they’ve received it.If they find the error, contact the creditor and ask them to send a written correction to all of its credit bureaus.
If you disagree with the results of the investigation, you can attach a 100 word statement of your version of the credit dispute to your credit report. Request a copy of your revised credit report to make sure it is correct.
Credit bureaus are legally required to investigate and correct wrong information, however, you have to point the error out to them.
Write a letter and describe the error and request an investigation. Send the letter by certified mail and return receipt requested to have proof they’ve received it.If they find the error, contact the creditor and ask them to send a written correction to all of its credit bureaus.
If you disagree with the results of the investigation, you can attach a 100 word statement of your version of the credit dispute to your credit report. Request a copy of your revised credit report to make sure it is correct.
What's not on my credit report?
Your credit report does not list your bank accounts whether checking or savings accounts. It also does not list mortgage loans, utility bills, medical bills, gas credit cards or other major assets. These types of items will show on your credit report when a debt collection has been initiated against you.
Credit scores consider a wide range of information on your credit report. However, they do not consider:
Your race, color, religion, national origin, sex and marital status.
Your age. Other types of scores may consider your age, but FICO scores don't.
Your salary, occupation, title, employer, date employed or employment history. Lenders may consider this information, however, as may other types of scores.
Where you live.
Any interest rate being charged on a particular credit card or other account.
Any items reported as child/family support obligations or rental agreements.
Credit scores consider a wide range of information on your credit report. However, they do not consider:
Your race, color, religion, national origin, sex and marital status.
Your age. Other types of scores may consider your age, but FICO scores don't.
Your salary, occupation, title, employer, date employed or employment history. Lenders may consider this information, however, as may other types of scores.
Where you live.
Any interest rate being charged on a particular credit card or other account.
Any items reported as child/family support obligations or rental agreements.
What is a FICO score?
Credit bureau scores are often called "FICO scores" because most credit bureau scores used in the US are produced from software developed by Fair Isaac and Company. FICO scores are provided to lenders by the three major credit reporting agencies: Equifax, Experian and TransUnion. The higher the score, the lower the risk.
There are other credit bureau scores, although FICO scores are by far the most commonly used. The FICO score from each credit reporting company considers only the data in your credit report at that company. If your current scores from the three credit reporting agencies are different, it's because the information those agencies have on you is different. As your data changes at the credit reporting agency, so will any new score based on your credit report.
Late payments will lower your score, but establishing or re-establishing a good track record of making payments on time will raise your score.
There are other credit bureau scores, although FICO scores are by far the most commonly used. The FICO score from each credit reporting company considers only the data in your credit report at that company. If your current scores from the three credit reporting agencies are different, it's because the information those agencies have on you is different. As your data changes at the credit reporting agency, so will any new score based on your credit report.
Late payments will lower your score, but establishing or re-establishing a good track record of making payments on time will raise your score.
Why do companies use scoring systems?
Some credit reporting companies use scoring systems to help creditors evaluate your creditworthiness. Credit reporting companies instruct lenders to identify credit related factors such as income level, length of employment and payment history, and then assign point values to each characteristic. By comparing this information to the patterns in hundreds of thousands of past credit reports, the score identifies your level of future credit risk. The Federal Trade Commission has a rule that if a credit reporting company uses a scoring system, it must provide you with your score and an explanation of how the score was determined.
How long will my payment history remain on the reports?
Even though you make a payment in full, it does not remove your payment history. The length of time payment history remains in your file is:
7 years from the date of the last activity - Credit and Collection Accounts
7 years from the date filed - Courthouse Records
10 years from the date filed - Bankruptcy Chapters 7 and 11
5 years from the date filed - Satisfied judgments, paid collections New York residents only
In most cases your negative information more than 7 years old will be removed from your credit reports. However, employers, insurance companies, or potential creditors may legally request negative data prior to that limit.
7 years from the date of the last activity - Credit and Collection Accounts
7 years from the date filed - Courthouse Records
10 years from the date filed - Bankruptcy Chapters 7 and 11
5 years from the date filed - Satisfied judgments, paid collections New York residents only
In most cases your negative information more than 7 years old will be removed from your credit reports. However, employers, insurance companies, or potential creditors may legally request negative data prior to that limit.
What exactly is on my credit report?
Your payment history on your credit file is sent to these three companies by credit grantors with whom you have established credit. Your history includes both open and closed accounts:
Account payment information on specific types of accounts (credit cards, retail accounts, installment loans, finance company accounts, mortgage, etc.)
Presence of adverse public records (bankruptcy, judgments, suits, liens, wage attachments, etc.), collection items, and/or delinquency (past due items)
Severity of delinquency (how long past due)
Amount past due on delinquent accounts or collection items
Time since past due items (delinquency), adverse public records (if any), or collection items (if any)
Number of past due items on file
Number of accounts paid as agreed
Account payment information on specific types of accounts (credit cards, retail accounts, installment loans, finance company accounts, mortgage, etc.)
Presence of adverse public records (bankruptcy, judgments, suits, liens, wage attachments, etc.), collection items, and/or delinquency (past due items)
Severity of delinquency (how long past due)
Amount past due on delinquent accounts or collection items
Time since past due items (delinquency), adverse public records (if any), or collection items (if any)
Number of past due items on file
Number of accounts paid as agreed
Can employers look at my credit scores?
If you apply for a job with an annual salary of $20,000 or more, your prospective employer has the right to request your credit history.
What’s On My Credit Report?
Your credit report includes payment history for your bank loans, any major retailer accounts, and your bank or credit card accounts. For each account, the creditor terms, type of account, amount of the original debt or credit limit and the outstanding balance will be shown. Your credit report also shows a list of any inquiries made in the last 6 months by any credit grantors. All credit related, publicly available information such as foreclosures, judgments, tax liens or bankruptcies will be shown.
Amounts You Owe
Amount owing on accounts
Amount owing on specific types of accounts
Lack of a specific type of balance, in some cases
Number of accounts with balances
Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)
Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)
Length of Your Credit History
Time since accounts opened
Time since accounts opened, by specific type of account
Time since account activity
Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account
Number of recent credit inquiries
Time since recent account opening(s), by type of account
Time since credit inquiry(s)
Re-establishment of positive credit history following past payment problems
Amounts You Owe
Amount owing on accounts
Amount owing on specific types of accounts
Lack of a specific type of balance, in some cases
Number of accounts with balances
Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)
Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)
Length of Your Credit History
Time since accounts opened
Time since accounts opened, by specific type of account
Time since account activity
Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account
Number of recent credit inquiries
Time since recent account opening(s), by type of account
Time since credit inquiry(s)
Re-establishment of positive credit history following past payment problems
Who Are Equifax, TransUnion and Experian?
These three companies are not government agencies. These companies sell information about you for a profit. Federal law requires credit reporting companies to delete any information that is outdated, inaccurate, and unverifiable or misleading when it is brought to their attention. However, it is your responsibility to bring the errors to their attention so they will correct them.
Friday
Are Reverse Mortgages taxable?
Reverse mortgage proceeds are not taxable because they’re not considered income, but rather, a loan.
Reverse mortgages do not affect entitlement programs such as Medicare. However, certain need-based government aid programs, such as Supplemental Security Income (SSI) and Medicaid, may be affected. Additionally, your eligibility to participate in any real estate tax deferral program offered by your city or county may be impacted. This information is not intended to provide any type of advice, and we recommend you consult with your Medicare, Social Security or Medicaid program administrator to determine the specific rules.
Reverse mortgages do not affect entitlement programs such as Medicare. However, certain need-based government aid programs, such as Supplemental Security Income (SSI) and Medicaid, may be affected. Additionally, your eligibility to participate in any real estate tax deferral program offered by your city or county may be impacted. This information is not intended to provide any type of advice, and we recommend you consult with your Medicare, Social Security or Medicaid program administrator to determine the specific rules.
Does the bank own my home with a Reverse Mortgage?
When you get a reverse mortgage, you still own your home. The title remains in your name. And as the homeowner, you will be expected to continue to pay property taxes and insurance and perform general maintenance and upkeep of your home, just as you do today.
If I still owe money, can I get a Reverse Mortgage?
You may be eligible for a reverse mortgage if you still owe money on your existing mortgage. However, the existing mortgage balance must be paid off at closing. You can choose to pay off the balance with funds from the reverse mortgage or another source.
Additionally, no income or credit score requirements are necessary to be eligible for a reverse mortgage.
Additionally, no income or credit score requirements are necessary to be eligible for a reverse mortgage.
What can I buy with the money?
A benefit of reverse mortgages is the freedom to use the funds however you want. Many people choose a reverse mortgage to eliminate their monthly mortgage payments and to cover large or unexpected expenses.
You can use your reverse mortgage to:
-Pay off an existing mortgage and eliminate debt
-Cover medical care, prescription drugs and in-home care
-Supplement your retirement income
-Make home improvements and repairs
-Modify your home for better accessibility
-Travel to visit family and friends
-Contribute to your grandchildren’s college education
-Purchase a new home with only a down payment
You can use your reverse mortgage to:
-Pay off an existing mortgage and eliminate debt
-Cover medical care, prescription drugs and in-home care
-Supplement your retirement income
-Make home improvements and repairs
-Modify your home for better accessibility
-Travel to visit family and friends
-Contribute to your grandchildren’s college education
-Purchase a new home with only a down payment
How do I qualify for a Reverse Mortgage?
To qualify for a reverse mortgage:
You and all other borrowers (maximum of three) must be the titleholder(s) of the property;
You and all other borrowers must be age 62 or older;
Your existing mortgage balance must be paid off at closing. You can choose to pay off the balance with funds from the reverse mortgage or another source;
and Your home must be an eligible property type.
What’s an eligible property type?
1) Single family home
2) Multi-family home (one unit must be your primary residence)
3) Condominium
4) Planned unit development
5) Modular home
6) Manufactured home (available only with Home Equity Conversion Mortgage)
Located in an eligible state (Senior Equity Reverse Mortgage products are not offered in all states). Ineligible properties include a cooperative (co-op) or mobile home.
You and all other borrowers (maximum of three) must be the titleholder(s) of the property;
You and all other borrowers must be age 62 or older;
Your existing mortgage balance must be paid off at closing. You can choose to pay off the balance with funds from the reverse mortgage or another source;
and Your home must be an eligible property type.
What’s an eligible property type?
1) Single family home
2) Multi-family home (one unit must be your primary residence)
3) Condominium
4) Planned unit development
5) Modular home
6) Manufactured home (available only with Home Equity Conversion Mortgage)
Located in an eligible state (Senior Equity Reverse Mortgage products are not offered in all states). Ineligible properties include a cooperative (co-op) or mobile home.
Should I rent or buy a home?
In some cases, renting may be cheaper than buying. For example, renting often requires a smaller monthly cash outflow than a combined mortgage payment that includes principal and interest, insurance and taxes and, possibly, mortgage insurance. As a result, renting may free up your cash flow and allow you to invest in other things.
Also, you earn in your home over the time you own it, which boosts your personal net worth. Renting does not create net worth.
Also, you earn in your home over the time you own it, which boosts your personal net worth. Renting does not create net worth.
Wednesday
How much are property taxes and insurance?
Property taxes are county/city specific and also depend on the construction methods of the home, ie. is the property within the city, close to the fire hydrant and fire station, which perils are covered or not, and whether there is an HOA with its fees as well, plus any special taxing district(s) which may apply.
If you have a specific property in mind, last year's tax bill is online through the assessor's office and it'll tell you the tax rate. Remember that your assessed value will be based on what you pay, not what the old assessed value was.
If the property is for sale, MLS should have some of this data -- and be aware that MLS has what the present owner says the data is whether that is true or not.
Hazard insurance is also difficult to compute because it depends on the structure and location (is it free standing, a condo, brick, wood, near the fire areas, mudslide areas, etc.)
As a rule of thumb, figure on about 25% of mortgage payment.
If you have a specific property in mind, last year's tax bill is online through the assessor's office and it'll tell you the tax rate. Remember that your assessed value will be based on what you pay, not what the old assessed value was.
If the property is for sale, MLS should have some of this data -- and be aware that MLS has what the present owner says the data is whether that is true or not.
Hazard insurance is also difficult to compute because it depends on the structure and location (is it free standing, a condo, brick, wood, near the fire areas, mudslide areas, etc.)
As a rule of thumb, figure on about 25% of mortgage payment.
Monday
I have been paying on my mortgage for years
If you've been paying your present mortgage for a number of years, deciding whether or not to refinance is a little more complicated. That's because you may have paid off a substantial part of the interest you owe on the loan and begun to chip away at the principal. When you refinance — which means you're taking a new loan — the bulk of your monthly payment once again goes toward interest.
Why do people refinance mortgages?
You may want to refinance your mortgage for several reasons:
1. You can borrow at a lower interest rate, which will reduce your monthly payments and often the overall cost of the mortgage
2. You may want to consolidate outstanding debt — for example, by combining a first and second mortgage into a single new one
3. You may want to reduce the term of your loan, which while it may increase your monthly payment, will dramatically reduce your total cost.
To figure out whether you can save money by refinancing you need to figure out:
a) How much lower your monthly payments will be
b) What refinancing costs you must pay
c) How long you plan to stay in your home
d) How many years remain on your current mortgage
Your best bet is to tell the lender what you paid for the house, what you still owe, and how much you're paying each month. Have the lender itemize all theup-front expenses involved in the refinance and estimate your new payments. Then you can figure when you will break even.
For example, if you save $1,600 in mortgage payments each year by refinancing, but it costs you $4,800 to refinance, you'll have to stay put more than three years to realize any savings.
1. You can borrow at a lower interest rate, which will reduce your monthly payments and often the overall cost of the mortgage
2. You may want to consolidate outstanding debt — for example, by combining a first and second mortgage into a single new one
3. You may want to reduce the term of your loan, which while it may increase your monthly payment, will dramatically reduce your total cost.
To figure out whether you can save money by refinancing you need to figure out:
a) How much lower your monthly payments will be
b) What refinancing costs you must pay
c) How long you plan to stay in your home
d) How many years remain on your current mortgage
Your best bet is to tell the lender what you paid for the house, what you still owe, and how much you're paying each month. Have the lender itemize all theup-front expenses involved in the refinance and estimate your new payments. Then you can figure when you will break even.
For example, if you save $1,600 in mortgage payments each year by refinancing, but it costs you $4,800 to refinance, you'll have to stay put more than three years to realize any savings.
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