The Klein Advisor – November 2016
On November 22, 2016 by Eric Klein
“Zombie Debt” – RISING FROM THE GRAVE
Zombie debt is a term used to describe older debts that have been brought to life by actions of collecting it. If you have a debt from the past that was not paid, the account may have been written off as “uncollectable” or charged off by the lender because they were unsuccessful at collecting the debt through conventional methods such as phone calls or letters.
Lenders generally stop trying to collect on a debt because of the statute of limitations, where the borrower is no longer “legally” required to pay it. Then, a breed of debt collectors buy these old debts in order to attempt to collect on them once again. If these collectors are unsuccessful, the debts will continue to be resold and bought (someone wants to get paid).
Hypothetically, let’s say ten years goes by since a debt was incurred, depending on what state you live in, there could be a chance that you are no longer legally a target of a lawsuit. This is why the debt is termed “dead”. But once again, there is that one company who bought the debt and will continue to call or send letters just so they can lead you to an action of “promising to pay”. The action of acknowledging a debt has the potential to reset the statute of limitations; hence the term Zombie Debt.
Debt collecting is a dirty business. If you think you have fallen victim to zombie debt collectors or have questions regarding debt negotiation and bankruptcy, please contact our legal team at 561-220-6659.
A Curious Foreclosure Spike?
CNBC reported a recent increase in the amount of foreclosures, indicating this might be the first sign of a crack in the recovery. In October, Attom Data Solutions, a multi-sourced property data warehouse that contains enhanced, premium real estate data for more than 150 million U.S. properties, reported there was a 27 percent increase of foreclosure court filings, including default notices, scheduled auctions and bank repossessions.
Daren Blomquist, senior vice president at Attom Data Solutions, stated, “the increase in October is not enough evidence to indicate a new foreclosure crisis, but it certainly demonstrates that this housing recovery is not completely devoid of risk.”
The recent spike has been the biggest monthly jump since August, 2007. Government issued loans, such as FHA and VA loans, account for 49 percent of all active loans in foreclosure. Borrowers who use FHA loans, which requires mortgage insurance, generally don’t have the income to afford a higher down payment.
So why the sudden increase in foreclosures? CNBC reported it could be linked to the weaker employment numbers last spring, “jobs correlate strongly to mortgage delinquencies.” Additionally, there could be other factors at play.
If you have questions regarding the foreclosure process, please contact our legal team at 561-220-6659.
A Couple of Reasons to Consider a Prenuptial Agreement
Generally, couples enter into a marriage planning to spend the rest of their lives together, with no intention of ever breaking-up. It can be a loaded conversation to have with your fiancé discussing the “what ifs” of divorce, but nonetheless, the unfortunate truth is that the divorce rate in the United States is high.
A Prenuptial Agreement can serve as an insurance policy against the worst-case scenario.
- Prenuptial Agreements lead couples to have that conversation about finances. According to CNN Money, 70 percent of engaged couples do not want to discuss finances because they are afraid of it leading to an argument. Additionally, Arlene Dubin, author of Prenups for Lovers: A Romantic Guide to Prenuptial Agreements states, ‘…studies show that monetary issues are responsible for 70 percent of divorces.’ A prenuptial agreement forces you and your partner to have a clear, straightforward conversation before you get married.
- Prenuptial Agreements aren’t a double standard. It’s a great myth that a Prenuptial Agreement only protects the party that has the most money, leaving the other party with nothing. This is false. Prenuptial Agreements can be negotiated for each individual’s situation, which can ultimately leave both parties in a better place.
- Filing for divorce can hardly be considered a win. A Prenuptial Agreement can prevent massive fights, court proceedings, legal fees and emotional trauma.
- Negotiation occurs during the good times. Typically, engaged couples are in their happy place. The engagement parties, bridal parties, the planning of a wedding with all your friends and family members, so it’s a time when engaged couples want to keep each other happy.
- More than often, during a divorce, couples can be hurtful and destructive towards one another. It’s an emotional time where making logical decisions about money can be more difficult.
- Prenups are not just for the wealthy. A Prenuptial Agreement can protect even the smallest savings accounts and protect against the worth of future investments. It is important to have a written outline before marriage about the entitlements of money as it grows. Again, as mentioned previously, Prenuptial Agreements can be negotiated to fit the individual needs of the couple.
If you have any questions regarding the process for a Prenuptial Agreement, please contact our legal team at (561) 220-6659.
Klein Law Group, P.A.’s TRUSTED PARTNER
Joseph C. Wasch, Esq.
Mr. Wasch is a partner and co-founder of Wasch | Raines, located in Boca Raton, Florida. Mr. Wasch’s practice concentrates on the areas of Corporate Transactional Law.
Wasch | Raines serves as general counsel to small businesses and franchise companies, handling civil matters and other complex matters.
Mr. Wasch has been practicing law for over 35 years and comes highly recommended with his vast knowledge and professionalism.
Wasch | Raines
2500 N. Military Trail, Suite 465
Boca Raton, FL 33431