Class action certified by Miami Judge Against David J. Stern

A recent article published by the Miami Herald online, explains that the once top lawyer for the banks as it relates to foreclosures has been sued in a class action by it's formers employees for violating labor laws.
This lawsuit was filed as a class action making the potential financial exposure to Mr. Stern very high. However, what's a class action lawsuit one might ask?

A class action lawsuit is a lawsuit in which a group of people can sue together in a single action because there respective claims are very similar to each other. Mr. Sterns lawyers have asserted that the labor laws were not violated as the lay offs were unexpected. Mr. Sterns law firm handled many foreclosures for the banks and had over 100,000 cases that it was handling. After allegations of improper paper work started circulating the banks pulled there cases and the firm started it's lay offs.

Business Bankruptcy are Down in 2011

According to a recent article by Scott Blake of Miami Today business bankruptcies have fallen. Business bankruptcy as opposed to a consumer bankruptcy, may allow the business to continue its day to day operations, or like a consumer bankruptcy allow for liquidation of the business’ assets in order to pay off the business’ creditors. According to the Miami Today article, “After a surge in cases during 2010, business bankruptcy filings in South Florida have slowed in recent months…From January through August, 886 businesses filed for bankruptcy protection in the Southern District of Florida, according to a Miami Today review of US Bankruptcy Court statistics. The district is on pace for 1,329 business bankruptcy filings for all of 2011. That projects to be a drop of 22% from a high of 1,709 filings last year.”

As the article notes, some lenders may be more willing to work with struggling businesses. Mr. Blake notes, “The sheer number of troubled loans has meant reassigning career lenders to new roles. They've gone from closing loans to closing companies, in some cases the same ones that they once funded. If a company files for bankruptcy protection, banks or other lenders may have long waits before a case is settled and any payments are received. Currently, the district has more than 33,000 cases pending from filings this year and in previous years, from both businesses and consumers. From March 2010 to March 2011, an onslaught of business and consumer bankruptcy filings hit South Florida. During that 12-month period, bankruptcy filings for the Southern District of Florida rose 26.5%, compared with the prior 12 months. That represented the largest percentage increase in the nation, according to the Administrative Office of US Courts. When businesses seek bankruptcy protection, most end up selling their assets and going out of business rather than reorganizing to stay in business. From January through August, 643 businesses in the district filed for Chapter 7 bankruptcy liquidation, while 205 filed for Chapter 11 bankruptcy reorganization, statistics show.”

The article notes that The Southern District of Florida recorded 24,366 consumer bankruptcy filings from January through August. That number projects to a total of 36,549 filings for all of 2011.

Businesses normally apply for two types of bankruptcy protection, either through a Chapter 7 bankruptcy liquidation or Chapter 11 restructuring plan. A chapter 7 liquidation plan allows for a business to wind down and liquidate its assets in a manner that is structured under the bankruptcy laws. More importantly, Businesses file for bankruptcy protection to take advantage of the automatic stay the Bankruptcy code provides. The automatic stay prevents and halts any collection to continue or commence once the bankruptcy petition has been filed. The drawback a Chapter 7 bankruptcy filing is that the business does not receive a discharge of the debts. The idea behind the code not providing a discharge of the business debts as to their creditors is that the business would be liquidated and stripped of any assets it may have had to satisfy that debt, essentially killing the business and making it impossible to continue functioning. Under a Chapter 11 bankruptcy filing, the business is still allowed to function while allowing debt to be repaid to creditors in a setting similar to an individual Chapter 13 bankruptcy.

Depending on the business owner’s goal either in continuing to function or wind down, bankruptcy may be a viable alternative that allows the business to properly pay down their debt or liquidate their assets to pay down their debt. Bankruptcy may also be an avenue that allows the business to restructure, reorganize, and revamp in order to maintain functioning.

by: Eduardo D. Fons

Fannie Mae begins efforts to educate homeowners facing foreclosures?

Fannie Mae begins efforts to educate homeowners facing  foreclosures?

In a recent article by Donna Gehrke-White published in the sunsentinal.com, Ms. Gehrke reports that “Fannie Mae is partnering with NBC and its Miami affiliate, WTVJ-Channel 6, to get the word out on the options available if people are having trouble making their house payments, said Andrew Wilson, spokesman for Fannie Mae, a giant in the secondary mortgage market.”  http://www.sun-sentinel.com/business/blogs/money-sense/sfl-fannie-foreclosure-campaign-20110914,0,714925.story

What does this new awareness means for the homeowner? What type of help can the homeowner expect from the government or in this case from an agency backed by the government? First one needs to determined if the loan one has is a Fannie Mae loan. If it is, the second step is to contact Fannie Mae by phone or fill out an online form at their website http://www.knowyouroptions.com/ . After that one needs to gather financial documents, for example: Pay stubs, Last year’s tax return, bank statements, Monthly mortgage statement, Credit card statements balances, Monthly payment amounts on other debts (such as school or car loans). The final step will be a Fannie Mae representative calling you an giving you advise as to your options.

One word of caution for the homeowner is to remember that at the end of the day they are taking to the bank, as such the banks interest may be at play and only those options more convenient to the bank may be offered. I suggest that homeowners informed themselves with all available material and then seek the help of an attorney knowledgeable in the area of real estate.

Written by: Hector A. Pena, Esq.

A Rise in South Florida’s Foreclosure Rate!

A Rise in South Florida’s Foreclosure Rate!

In a recent article by TOLUSE OLORUNNIPA published in the Miami Herald, OLORUNNIPA reports that “The foreclosure rate in Miami-Dade County rose to 18.8 percent in June, up from 17.6 percent a year earlier. In Broward, 14.6 percent of mortgage loans were in foreclosure in June, compared to 13.4 percent in June 2010.” Also, “South Florida’s foreclosure rate remains much higher than the national rate of 3.5 percent. In Miami-Dade, 25.6 percent of loans are more than 90 days overdue, down from 27.5 percent last year. In Broward, the 90-day delinquency rate dipped to 20.8 percent, from 22.3 percent last year.”

See http://www.miamiherald.com/2011/09/08/2397341_south-floridas-foreclosure-rate.html#storylink=addthis%23ixzz1XVLT29sE#ixzz1XYkAZxEB

What does this rise in foreclosures mean to the South Florida Consumer? First, it’s a clear sign that the banks are working through their respective legal issues, many are settling claims with the governments and local state governments. The most important thing for consumers is to be informed and be able to get competent advise if facing foreclosure.

First, homeowners have options; the legal documents should be reviewed by an attorney experienced in this type of litigation. It is important that the banks follow the law and procedure when filling suits against homeowners. Also, even in foreclosure there are many options available to home owners. For example, modification of the existing loan, mediation with the bank, deed in lieu of foreclosure, short selling the property and others. Homeowners should take an active role in deciding what steps to take in order to bring a solution to their respective problems.

Hector A. Pena, Esq.

www.247alawfirm.com

Driving with Suspended Licenses or Revoked Licenses in Florida

Driving in South Florida with a Suspended license or a revoked license, could get you into  a compromising situation under the current traffic laws in Florida. In most cases a suspended license comes from simply not paying a traffic ticket or not going to court to defend it. Once a Traffic Violation has been issued you have 30 days to comply and pay or to send the court your plea of guilty or not guilty If you don’t act in time a D6 may be issued resulting in a suspension of your drivers license. 

Your traffic ticket could be in collection as well. Although this does not mean you cant defend that ticket. You can make your case with the courts and try to reopen your case. Traffic ticket attorneys may be able to assist you with this process and you should consult with one if this is your current status. 

Collection increases your cost to fighting a ticket or even just paying for it. If the DMV Suspends your driver license you may incur an additional $60 fee to get it activated again. 

Eric P. Newcomer from TheLedger.com writes “In Florida, a state with about 15.5 million legal drivers, 2.2 million people currently have suspended or revoked licenses, authorities said.” further saying “AAA traffic safety estimates that two-thirds of people are barred from the road keep driving” read more here: http://www.theledger.com/article/20110906/NEWS/110909587?Title=2-2-Million-Floridians-Are-Driving-Illegally-&tc=ar

What most people don’t realize is not taking action quickly on traffic violations can result in  a lot of headaches and unnecessary expenses. Remember once you receive a traffic violation you have thirty days to respond, pay, or hire an attorney to defend your ticket. Quick action avoids suspension and saves you money.


Eduardo D. Fons


http://www.247alawfirm.com/fight-traffic-ticket/