• Trap Doors Being Exploited In Cards ‘Designed To Be a Safety Net’ For Consumers

    On Monday, we noted some encouraging stories indicating that Americans were cutting back on borrowing, credit card debt was declining and the Consumer Financial Protection Bureau (CFPB) was putting more institutions on notice about deceptively marketed products. However, a Wall Street Journal story published on September 5, 2012, called attention to another type of plastic that is starting to become a growing problem: prepaid cards.

    Noting that these “cards were designed to help the less-affluent have better control their finances by allowing them to spend only the preloaded amount,” the Journal reported that some consumers are now accumulating debt because of overdraft and other credit-like features have been added to the cards in recent years. Furthermore, the Journal also stated that prepaid cards are “among the fastest-growing types of plastic,” as American consumers loaded $83.3 billion onto prepaid cards in 2011. Payment-industry researcher Mercator Advisory Group said this was a 34 percent increase over the prior year, according to the Journal.

    The National Consumer Law Center, the Center for Responsible Lending and the Consumer Federation of America are now lobbying the CFPB to prohibit prepaid cards from offering any type of credit. The Journal reported the agency is “evaluating the consumer advocates’ proposal as part of a broader effort to more-closely regulate prepaid cards.”

    The Journal story began by citing an Ohio man who borrowed $400 and loaded it onto a prepaid card, beginning a cycle of debt that would ultimately result in $1,344 of total fees from the card provider by the time the man stopped borrowing a year later. “Prepaid cards were designed to be a safety net,” Steve Streit, chief executive of prepaid card issuer Green Dot Corp., told the Journal. “Once you start adding overdraft and other types of credit, it becomes a form of debt.”

    Does this situation sound similar to your own? You should know that you may be able to wipe out your credit card debt by filing Chapter 7 or pay back a portion of the debt through a Chapter 13 bankruptcy plan. Our Chicago bankruptcy lawyers can help determine which plan you are eligible for when you fill out the form on this page or contact our firm at (866) 930-7482.

    Benjamin Brand Services – Chicago bankruptcy attorneys

  • How a $140 Sewer Bill Could Cost New Jersey Plumber More Than $50,000


    If it was not surprising enough for 60-year-old Dominick Vulpis and his wife to learn last December that they had lost their home to foreclosure, imagine the shock when they learned exactly why: a four-year-old $140 sewer bill.

    NBC News reported on July 24, 2012, that the foreclosure was the result of a tax lien (see explanation in video above) his hometown of Middletown, New Jersey, had sold to a third-party investor. While NBC noted that this is “an increasingly common practice as cash-strapped cities and towns try to raise badly needed revenues to close widening budget gaps,” it also mentioned that situations like the Vulpis’ are rare.

    “It was never brought to my attention until it was too late and we were served with papers saying we had to move out of our house,” Vulpis told NBC. “I may pay a bill late, but I pay them. I’m not trying to beat anyone for $140.”

    NBC also noted that the National Consumer Law Center estimated that local governments raised nearly $15 billion through tax lien sales in 2010. Vulpis did manage to get the foreclosure overturned by rolling the bill into his mortgage balance, but NBC said that the total bill could exceed $50,000 when combined with attorney fees and added interest.

    While a majority of tax lien sales were for unpaid assessments on failed or unfinished commercial developments, such sales still land more people in foreclosure proceedings. A struggling economy has left more homeowners seeking foreclosure help , and this week we will focus on some of the pains caused by foreclosure. If you are facing foreclosure, you may be able to delay the process by filing Chapter 7 bankruptcy or possibly even save your home by filing Chapter 13 bankruptcy . Contact our firm at (866) 930-7482 to see how our Chicago bankruptcy lawyers can help you.

    Benjamin Brand Services – Chicago bankruptcy attorneys