Damon Duncan

How Do I Write An Answer To A Complaint?

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[youtube]http://www.youtube.com/watch?v=zZD3JCsEyqY&feature=youtu.be[/youtube] After a complaint is filed against you, you have 30 days to file an answer to that complaint. There are many generic forms that can be found that will help you to do this. If you use the internet to help you, make sure it is a reputable website that you are getting the … Read more

What Is A Complaint? | Parts of A Civil Lawsuit

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When the sheriff shows up at your door and hands you a stack of papers with a bright yellow sheet on top, what are they actually giving you? Most likely they are giving you what is called a complaint. A complaint is the first step in initiating a lawsuit. This means that someone has filed papers with the court to begin the legal process to write some sort of wrong. Most of the complaints clients who come into our office see are ones saying they owe someone money.

Bills in Mailbox

So what does a complaint typically say? It will state which county the complaint has been filed in and whether it is in the District or Superior court for that county. The title of the complaint will also say who is filing the complaint, the plaintiff, and who they are filing it against, the defendant. The case number will also be stated in this section.  Below that it will also state why they are filing the complaint. For example, say John Smith owes ABC Bank $10,000 that is past due on a credit card. The body of the compliant will list this, along with the specifics of when the card was applied for and the actual card number.

There will also be several statements that are numbered and they will list the terms of the complaint. These typically state who the plaintiff is, where the defendant lives, that the defendant opened an account and agreed to the term and conditions of the account and that they then have failed to pay on that account. The last paragraph will state what the plaintiff wants as a remedy or result of filing the complaint. What the plaintiff will typically say they want is a judgment for the full amount the plaintiff owes plus a certain amount of interest and attorney’s fees.

It is important that you respond to the complaint by filing an answer. If you do not respond to the complaint then you will automatically be found liable for the lawsuit. The courts will view it as you failed to respond and, therefore, you admit that you owe the money and are liable to the plaintiff. The court will then issue a default judgment saying you are fully liable for the amount owed. Be sure to read our other blog post on how to respond to a complaint with an answer. Also know that if you do have a lawsuit against you bankruptcy may be an option worth exploring more.

Why Won't They Draft Payments From My Bank Account After Filing Bankruptcy?

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If before filing for bankruptcy you had automatic drafts from your bank accounts to pay other bills then this may stop when you file the bankruptcy. It’s obviously important to know that these automatic drafts may stop because we want to make sure you do not get behind on things like house payments, car payments … Read more

Why You Might Need To Do A Quitclaim Deed Or Deed in Lieu of Foreclosure Even After Filing Bankruptcy

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Whether or not someone who files bankruptcy also needs to do a quitclaim deed or deed in lieu of foreclosure is a question that many bankruptcy attorneys and clients are asking themselves these days.  A few years ago, most banks and mortgage companies (we will call them banks for this blog) foreclosed on a property – house or land – within three to four months of the bankruptcy filing.  At the foreclosure sale, the bank would pay the property taxes on the house as well as any homeowner association liens on the property.  For many people, that is now considered the “good ole’ days”.

House in ForeclosureWith the depressed economy and the increase in foreclosures, banks are taking considerably longer to foreclose on properties.  There are statistics that indicate it is taking an average of six months for banks to foreclose in North Carolina; however, in some cases, it is taking two years or more for them to sell the house or land at foreclosure.  If you want to continue living in the house until the bank forecloses, then that timeframe may be wonderful news!  Unfortunately, if you have already moved out of the house, the lengthy foreclosure process can be both annoying and costly.

Because of the lengthy process, bankruptcy clients are receiving notices of delinquent city/county taxes as well as membership association or HOA dues.  (For this blog, we will use the generic term of “HOA dues”.  This can be a traditional neighborhood homeowners association, condominium association, cooperative association, etc.  It is also important to note that the “dues” for this blog encompass dues, assessments and fees.)  With the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (known as BAPCPA and a few other names that can’t be written), 11 U.S.C. § 523(a)(16) holds bankruptcy clients responsible for HOA dues that become due and payable from the date after the bankruptcy filing until the property is foreclosed on by the bank, sold to a third party, conveyed with a deed in lieu of foreclosure or a quit claim deed.  As a result, even if the house is surrendered in bankruptcy and you have moved out of the house, you may be responsible for the HOA dues until the bank forecloses.  In some high-end neighborhoods as well as condominium and townhouses neighborhoods, the HOA cost can be expensive.  This part of the bankruptcy code does not seem fair, but many HOA have started taking advantage of this language since they are tired of waiting on the bank to pay the HOA dues, conduct normal maintenance on the property, etc.

As a result, many bankruptcy attorneys are suggesting their clients consider a quit claim deed or possibly a deed in lieu of foreclosure.  This will transfer the property out of the bankruptcy client’s name and in most cases eliminate the debtor’s responsibility for the taxes and HOA dues.  The quit claim deed literally transfers the property form the existing homeowners to another party, e.g. the bank or HOA.  There is no guarantee with this deed, so the homeowner would be transferring HOA liens, other mortgage liens, judgment liens, etc. with the property.  Some bankruptcy attorneys will assist clients with the quit claim deed, but there is usually an additional fee for these services.  Other bankruptcy attorneys will recommend you speak with a real estate attorney that will prepare the quit claim deed, file it with the register of deeds and serve it on the appropriate parties.  You may also want to consider a deed in lieu of foreclosure to expedite the process.  The deed in lieu is prepared by the bank and/or their attorney.  There may be ramifications on your credit if you complete a deed in lieu of foreclosure, so you would want to discuss this approach prior to signing any documents.

Regardless, you should not take any action until you after you speak with your bankruptcy attorney.  In some cases, it may be beneficial for you to consider one of these options prior to your bankruptcy filing, but in other cases it is beneficial to wait until after the bankruptcy has been discharged and a final decree issued.

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Why Have I Stopped Getting Statements or Bills After Filing Bankruptcy?

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When you have filed your bankruptcy petition and receive a case number, an automatic stay is enacted to protect you under the bankruptcy code from creditor contact, lawsuits, repossessions, foreclosures, etc.  In turn, this limits the contact a creditor may have with you. If a creditor violates the automatic stay then they can be sanctioned … Read more

Are Workers’ Compensation Benefits Protected in Bankruptcy?

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In many cases when a client walks in our office to seek bankruptcy advice it is because they are at the end of their rope and under severe financial distress.  Often times, many clients have already lost or are at risk of losing nearly everything they have.

When someone has been injured at work they are no longer able to receive their full compensation if they are unable to work due to their injury. Instead, they get workers’ compensation benefits which are typically 66.6% of their regular income. Workers? compensation benefits may be the only asset or source of income a person has. In these situations, one of the first questions a client will ask is whether or not their workers compensation benefits will be protected, and will they be able to continue to receive the benefits if they file bankruptcy.  Well, in most cases the answer is ?yes?.

Workers compensation benefits may include payments you receive from your employer after being injured in an accident at work. These benefits/payments are usually based upon a percentage of your wages and are considered income and will not be affected by filing bankruptcy.

Under North Carolina law, workers? compensation benefits are exempt. When you file a bankruptcy, the bankruptcy Trustee does not have the legal right to seize any benefits that you are receiving at the time.  Although the Trustee cannot take your benefits, your benefits are considered income and will be used for the Means Test to determine whether or not you can qualify for a Chapter 7 bankruptcy and/or the amount that you will need to pay back to the court in the event that you file a Chapter 13 bankruptcy.

If you are expecting a large workers compensation settlement, it is very important that you discuss the pending settlement with your attorney ahead of time. Once a settlement is reached, it is necessary in some districts of North Carolina that you obtain the Court’?s approval to settle the claim and the exemptions in your bankruptcy are amended.

Mortgage Companies Are Taking A Long Time to Foreclose, Isn’t That A Good Thing for Me?

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As discussed in a previous blog post, it is taking mortgage companies an extraordinary period of time to foreclose on properties these days.  Unfortunately, the delay in the foreclose process seems to be a “double-edged sword” depending on the homeowners’ goals.

Mortgage Company Foreclosing on House

In some cases, it is a benefit to the homeowners, since they may be able to live in their home for a year or more before the foreclosure is completed.  This delay allows the family to stay in “their” home and allows their children to finish the school year in a familiar setting with friends and teachers they adore.  In other cases, it is purely a financial decision.  The delay provides time for the family to save money, since they are not paying the mortgage loan on the house or rent on another property.  When the day comes to move out of the home, the family has the funds needed for moving costs and for the security deposit and rent on the new apartment or house.

On the other hand, the family down the street has made the decision to move on with their lives and have already moved out of the house.  The house represents a negative time in their lives and they want a fresh start in new surroundings.  In other cases, a member of the family has accepted a new job in another state, so they have no option but to move.  These homeowners want the mortgage company to foreclose as soon as possible so this chapter of their lives can be closed.  The family has moved on, unfortunately the house is still legally their responsibility.  These families receive stack after stack of letters from the mortgage company offering workout plans and other alternatives to foreclosure.  On top of that, the homeowners association (HOA) is sending threatening letters regarding tall grass growing in the law, mosquitoes in the swimming pool, and delinquent assessments, dues and fees.  The HOA is threatening to file a lawsuit against the homeowners if they do not pay the debt.  Pay a debt to the HOA for a house they do not live in?  Yes, the HOA assessments, dues and fees are still the homeowners’ financial responsibility until the property is no longer in their names, so the HOA debt must be paid.  As the old saying goes, these families can’t get the “monkey, aka house, off their backs”!

As a result, the delay in foreclosing on a house can be a good or bad thing depending on the homeowners’ goals.  As the homeowners, you can ask the mortgage company to expedite the foreclosure sale but often that is unsuccessful.  You can also look at signing a deed in lieu of foreclose or possibly quit claiming the property to the mortgage company.  These options will be covered in a later blog.

Why Is It Taking Mortgage Companies So Long to Foreclose on Houses?

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This is a question that many people are asking these days, why is it taking the mortgage companies so long to foreclose?  As bankruptcy lawyers we deal a lot with people who are trying to save their homes as they enter the foreclosure process. So knowing how long it takes until a home enters into the foreclosure process is important for many of our clients. There are several reasons for the delay in foreclosures.

Question About Bankruptcy

Needless to say, the slow-down in the economy has resulted in the loss of numerous jobs throughout the country.  For those lucky enough to keep their job, deep pay cuts have often occurred.  Add predatory lending practices from a few years ago and it all spells disaster for countless Americans and the lending institutions or mortgage companies.

Unfortunately, many Americans found they could no longer afford the American dream of a home.  With no way to make their mortgage payments, many people began defaulting on their mortgage loans and lending institutions began the process of foreclosing on many homes.  As the economy has continued to suffer, the sheer number of foreclosures has increased to a point that mortgage companies are simply overwhelmed by the volume.

As you may have read or heard in the media, mortgage companies have been heavily scrutinized regarding their foreclosure practices over the past few years.  The practice referred to as “robo signings”, where mortgage company officials signed off on foreclosure proceedings without fully investigating the accuracy of the documents they signed, has been investigated by federal regulators as well as state attorney general’s from all 50 states.  In several cases, bank officials admitted to signing foreclosure documents without reviewing them or verifying their accuracy.  Although this practice is not condoned, most of us understand how this may have happened.  The officials signing the documents may have believed their signature was merely a formality, and that the documents had already been verified for accuracy before reaching their desk.  So with a pen in hand, and a huge stack of foreclosures on their desk, the robo-signing began.

The investigation into robo-signing foreclosures disclosed many disturbing scenarios.  There were cases where homeowners were actually not behind on their mortgage payments but were facing foreclosure due to errors in paperwork.  In other cases, the homeowners were in the process of or had recently completed loan modifications with the mortgage companies while on a parallel path to foreclosure.  Needless to say these practices outranged many people.  The outcry resulted in the government’s investigation into the foreclosure process and then a self-imposed moratorium by many mortgage companies.

If you are like most homeowners, your mortgage company has changed at least once since you obtained your loan.  In many cases, the loan has changed hands two, three and even four times.  As a result, paperwork has often been misplaced or simply lost during the process.  These issues may delay the foreclosure process, since the legal documents needed to complete the foreclosure cannot be located.

As a result of these issues and others, most mortgage companies and lending institutions are completely overwhelmed with the sheer volume of foreclosure files.  As a result, it is taking some mortgage companies a year or more to foreclose on a home.  Obviously the timeframe varies, so there is no guarantee it will take the mortgage company that long to foreclose on your home!