Credit Union Customers love their credit unions.  They love the level of service that they get and they love the relatively low rates for loans and high rates for savings.  Much of this love is not reciprocated.  Credit Unions, if you are ever forced into a bankruptcy proceeding are fond of forcing reaffirmation agreements and enforcing their nearly ubiquitous cross-collateralization and future advances clauses.  These are things that you almost never have to worry about if you get your financing elsewhere.

Customers must beware.  If you take out a loan with a credit union because they offer you a great rate, beware of the details.  You will likely be signing a loan document that includes language allowing them to hold on to your title until you pay any other loan that you have with them.  If you are a credit union customer and you have a credit card through the credit union the credit card agreement may include language allowing them to secure that card to any future security interest that they hold.  For example, you get a credit card, you happily use it and are happy with the rate, you then decide that you want to get a car loan through the credit union because they are offering a great rate.  Now the car loan is obviously secured by the car, what is not obvious to almost everyone is that the credit card is also secured by the car.  This means that after you have paid off your car loan, the credit union can withhold your title until the credit card is paid off.  The same goes for personal loans with credit unions. [Read more…]

With the housing bubble bursting a few years ago, many homeowners were left underwater on their homes.  Some people were so far under that they strategically defaulted on their mortgages and walked away from their homes.  Some filed bankruptcy and “surrendered” their homes only to find out that did not mean they were off the hook.  For others still, their lenders or servicers had commenced foreclosure, obtained a judgment and never executed on that judgment.  Meaning they never sold the homes at Sheriff’s sale or trustee sale.  Whatever happened, thousands of people are stuck with homes that no one wants.  When this happens they find that they are still responsible for housing code violations, condo or homeowners association fees, property taxes until the house transfers, and are liable if anyone gets injured on their unwanted properties.

What to do?  These unsuspecting homeowners have some options.  The first step may be to attempt to get homeowners insurance to protect yourself from liability. You should then contact that mortgage company that doesn’t seem at all interested in the property.  You want to ask them for an application to do a deed-in-lieu of foreclosure.  This would basically allow you to transfer the property over to the mortgage company.  You may also be able to short sell the home.  To do this you use the same application with the bank.  Yet another option is to ask the mortgage company if a short payoff is an option.  With a short payoff, you offer the mortgage company a fraction of what is owed on the home and they release their lien meaning that you would own it free an clear.  I have seen short payoffs for 4% of the amount owed on the loan.  If the mortgage company isn’t interested in any of these options, they may be interested in you transferring the property over to a land bank if there is one active in your county. [Read more…]

Filing a bankruptcy is a big life choice.  As I have written in previous posts it is not nearly as scary as people assume it to be.  That said, it is important to choose an attorney who knows what they are doing and who has a reputation for good client advocacy.  You don’t want to get stuck with someone who won’t return your phone calls, is rude, or who gets disbarred after they start taking your money.  What follows are some tips for choosing a good bankruptcy attorney.

1. You can find attorneys with bankruptcy expertise by using the attorney finder function of www.nacba.org.  NACBA is the National Association of Consumer Bankruptcy Attorneys.  Attorneys that you find on this site have paid dues to the organization which I believe shows that they are committed to the bankruptcy field.  You want an attorney who files bankruptcies regularly, not once or twice a year.
2. Another good source is your local bar association.  Contact your local bar association and see if they have a referral service.  Referral services generally require attorneys to have 5 years of experience in the field you are looking into.  They also often require that their attorneys they refer clients to have completed continuing education courses in the field you are looking for.
3. Ask around about the attorneys reputation.  If you do not know anyone who has used them, look online.  Attorneys are rated by www.avvo.com.  While their methodology may not be perfect, (for example, you might have a great attorney with 20 years experience who has a rating of 7.0, on the other hand you might have one with 2 years experience with a 10.0.)  I am not sure how accurate the ratings are, but you can at least see if they have any reports of misconduct.
4. Go to a free consultation.  Most bankruptcy attorneys will offer you 30-60 minutes of their time to figure out if you are a good candidate for bankruptcy and to determine how complex your case is.  This really serves an additional purpose of helping you to determine if it is someone you would be comfortable working with.  Some attorneys do charge a consultation fee.  If this is the case with the attorney you want to meet ask them if they apply that fee to the overall attorney’s fee.  Even if they do charge an additional fee for the consult, it may be worth it if their reputation is sterling.
5. Ultimately, make the decision using all the information at your disposal.  If they were referred by a reputable source, if they have a good reputation, and if the fee is something you are comfortable paying, be confident in your choice to go forward and provide your attorney all of the information that ask for.  If you have done this, chances are your case will go smooth.

Best of Luck,

Steven M. Palmer, Esq.
Licensed in WA and OH
https://www.curtislaw-pllc.com
Edited by Justin Vorhees