Second Mortgage

Do you know the current value of your property? If you are making payments on a second mortgage or HELOC and there is little or no equity, you should consider your options regarding that debt. Throwing good money at a bad debt may not be in your best interest. We offer a FREE debt consultation to learn you debt relief options for your second mortgage debt. 

Visit our Second Mortgage Debt Relief Page to find out how you can lower your total debt owed!

Debt Collection Notices

Have you ever received a collection notice from a creditor? Do you look at these notices and wonder who the heck NCO Group is? Or how about Portfolio Recovery Associates, Expert Global Solutions or Encore Capital Group? These are some of the major debt collectors in the country and they all have one goal in mind – to collect from you. But before you whip out your checkbook to pay them off, you must make sure that you are dealing with a legitimate collection agency. The following article provides 3 simple steps to follow if you receive a debt collection notice.

3 steps to follow if you receive a debt collection notice

Something not discussed too often is brought up at the end of the article. Check your credit report on an annual basis. There are three bureaus and most experts will suggest that you check one report per quarter. This may give you a better chance to catch an error on your report earlier than if you check all three at the same time once per year. There are a number of sites to use to check your credit, but is the only site I am aware of that is truly free. You can access all three of your reports through that website. Just make sure to decline any add-on services if you don’t really need them. Dealing with your credit is never an easy thing to do. But by being proactive you may be able to avoid a headache from an erroneous or fraudulent debt collector.

Bank Levies and Wage Garnishments

Bank Levies and Wage Garnishments

When a creditor sues you and obtains a judgment for unsecured debts such as credit card debt, the next step is for the creditor to collect on that judgment. In California, the easiest ways for a creditor to collect on a judgment are to garnish your wages or levy on your bank account. If your creditor has done some research on you, they likely know where you work and possibly where you bank. It’s not that difficult for them to find out. So let’s take a look at what happens here and how you can fight back against these collection methods.

Bank Levy

The judgment creditor can ask the Court to issue a writ of execution, which will be delivered to your bank by a sheriff. The sheriff then seizes the funds in your account for up to the amount stated in the writ, which will usually include attorney’s fees, costs and post-judgment interest. Think of this as a one-shot deal per writ. They cannot continue to levy in the future under that one writ. But they can get multiple writs issued over time to levy on your bank account until the judgment is fully satisfied. Most people don’t realize this has happened until their debit card gets denied at the register.

Wage Garnishment

Much like a bank levy, a creditor with a judgment against you can have documents served on your employer to garnish wages. California law states that a judgment creditor can garnish up to 25% of your wages until a judgment is paid in full. Your employer cannot ignore this and must garnish your wages as mandated by the writ. The only bright note is that your employer is not permitted to terminate you simply because your wages are being garnished.

Your Potential Remedies

Either of these collection efforts can be financially crippling. Once the sheriff seizes funds from your bank or your employer receives notice to garnish your wages, the clock is ticking for you to take action. There are mechanisms in place to reduce the levy or garnishment.

The Court will permit you to file a claim of exemption to either reduce or eliminate the financial hit you have taken on a bank levy or wage garnishment. For instance, on a bank levy, you can claim an exemption of up to 75% of income from employment earned within the 30 days prior to the bank levy. If you can prove that the money seized by the sheriff is from income received within the last 30 days, the Court can order the sheriff to refund that 75% to you. The idea here is that the Courts don’t want to bankrupt you to satisfy the debt. They recognized that there are certain necessities of life and the Court will not deprive you of that. But you must take action within the timeframe permitted by law. Typically the same applies on a wage garnishment. If you can prove to the Court that your wages are needed for the basic necessities of life, your garnishment can be reduced or eliminated.

The key is not to wait too long to fight back. If you miss your deadlines to oppose a garnishment or levy, that money held by the sheriff is gone and you’ll never get it back. But, by taking swift action you can reduce or eliminate these judgment collection efforts. Today I helped a client get back 75% of a paycheck after the bank levied on their account on a payday. They originally thought that money was lost forever. I’m just glad they took quick action to retain me so I could fight for them.

As always, I suggest that if this process seems too intimidating for you, seek the assistance of an attorney with experience handling unsecured debts. You deserve an honest opinion on all of your options when facing collection on a judgment. In some instances, it may be best to consider bankruptcy. If that’s not a good option for you, it may be possible to negotiate a settlement with your judgment creditor. Everyone’s circumstances are different and you should know your options.

The FAFSA Deadline is Approaching

The deadline to submit your Free Application for Federal Student Aid (affectionately known as the “FAFSA”) is rapidly approaching. Check out the following link which provides some great tips to increase your likelihood of receiving financial aid towards your college education.

Decoding the FAFSA for college savings

I think the biggest takeaway from this article is to plan ahead. You don’t necessarily need to wait until your taxes are prepared to submit your FAFSA. Moreover, delaying the filing may mean less money that you will be offered. The cost of a college education continues to rise as does the total student loan debt in our country. Timely submitting your FAFSA could end up saving you thousands of dollars. You owe it to yourself and your future to minimize your college debt as much as possible.