The fall out from the mortgage crisis continues to create new and more complicated lending guidelines. The latest one is probably the scariest as a borrower could potentially lose their financing even a day before the closing.
Fannie Mae and Investors now require that all debts and potential debts be re‐verified at the time of closing. Any change (increase) to existing debt or the addition of new debt could result in your loan no longer meeting qualifying guidelines and your loan being denied.
If any new debt is acquired on any existing credit accounts and/or if any debt is incurred through new credit accounts, the loan will be subject to requalification. If it is determined that your loan does not meet current qualifying guidelines, your loan closing could be delayed or terminated. This could result in the loss of your rate lock, your earnest money deposit and other costs associated with your loan.
This problem is going to occur most often in connection with home purchases. Typically, once people have completed their home inspection, signed their P&S Agreement and submitted their loan application, they typically begin planning for their new home, including the purchasing of new furniture. Too often the lure of interest free financing and/or an offer to save 10% or 15% if you open a new account causes them to charge the new purchase. This will trigger a credit inquiry and a change circumstance that will appear on the credit report pulled two or three days prior to closing which may result in your loan no longer meeting qualifying guidelines. Since most financing contingencies are eliminated when you receive your commitment from the Bank, if you lose your loan you most likely will lose your deposit on your purchase. Thus, it is very important to avoid using your existing credit and/or applying for new credit between the time you submit your loan application and the time of your closing. Feel free to contact us if you have any questions regarding these changes at sclifford@elclaw.com.
Many clients will ask if it is better to settle a workers’ compensation or wait. Also, whether the insurer has to settle at all is another question. To answer the latter first, no, the insurer has no obligation to settle. The insurer will opt to settle if it makes financial sense for it to settle. If it appears that the claim will be costly for it down the road, the insurer will look at the numbers and try to work out a deal that will afford the claimant a lump sum now to hopefully reduce its own exposure to the claimant in the future. To address the first part of the question, the timing of settlement is often the hardest to gauge. Sometimes, events will dictate when a settlement should occur (judge’s order, weak medical statement,improved work capacity). However, it is important not to settle from a position of weakness because once a settlement occurs, there is no turning back. Make sure that all concerns are expressed to the attorney handling the case so that when the time for settlement occurs, the flow of information is solid. In that way, fewer mistakes in judgment are made. And hopefully, settlement can provide a great new start toward financial security. Please contact attorney Bruce S. Lipsey at 781-829-9100 for further information. www.elclaw.com
Once a person applies for social security disability, they will be subject to a medical examination by the social security administration. They are usual not that helpful. Those examinations are usually used as the basis for a denial of benefits. An applicant should not be discouraged from moving forward. The applicant’s treating doctor’s opinion will be given more weight by the judge than the social security doctor. Therefore, it is important for the applicant to maintain good communication with his/her doctor so when it is time for that doctor to be called on for their opinion, it will be a favorable report. Please contact attorney Bruce S. Lipsey for further questions. 781-829-9100. WWW. elclaw.com.
The option is there for an individual who is applying for Social Security Disability benefits to either apply on line herself, apply in person at the local social security office or have my law firm file it for you. Given the fact that there is a waiting period of five months before benefits can start, I would recommend waiting a few months before applying. Please contact me with any questions. Bruce Lipsey, Esq. 781-829-9100. elclaw.com
Everyone has seen those catchy ads for auto insurance where you can go on-line and save $500.00 on your auto insurance by picking and choosing your own coverage. The problem is that most of us do not know what we are picking. As an example, I have met with three clients in the last month who all in an attempt to lower their cost of auto insurance chose an $8,000.00 PIP deductible (two of the three did this on-line). Well they certainly saved some money on the cost of their annual auto insurance bill. However, what they did not realize is these minimal annual savings would cost them thousands of dollars in unpaid medical bills if they were involved in an automobile accident regardless of who was at fault. Sure enough, each was involved in an automobile accident and sustained some minor injuries. As a result of their choice of this PIP deductible, each was then required to pay their own medical bills despite the fact that each and everyone one of them had some form of health insurance. Before, you make a change to your automobile insurance coverage contact us at sclifford@elclaw.com to discuss what your short term savings may cost you long term.
I am happy to report that the long awaited overhaul of the Massachusetts Homestead Act is one step closer to becoming reality. While there are several important changes in the current proposal being debated on Beacon Hill, the most significant change is the creation of an automatic level of protection. Currently, unless you file a Declaration of Homestead at the Registry of Deeds the equity in your home is not protected. Under the new proposal, every homeowner would be granted this automatic protection of up to $125,000.00 of equity in one’s home without the need of filing any Declaration at the Registry of Deeds. As is the case now, if you choose to file a Declaration of Homestead at the Registry of Deeds this would this would allow you to obtain higher levels of protection, $500,000.00 for the typical homeowner and $600,000.00 if you qualify as disabled or are over the age of 62. In addition to this significant change, the new Act would eliminate the confusion that has developed over the years due to the typical language you see in a mortgage that terminates a previously filed Declaration of Homestead, allow transfers by family members or tenants in common without the need of filing a new Declaration of Homestead and allow beneficiaries of realty trust to exercise the protection of the Homestead Act. It is anticipated that the bill when it passes will contain the necessary language making these changes retroactive to all homeowners in addition to previously filed Declaration of Homesteads meaning no new filing is required.
After a workers’ compensation claimant starts to receive benefits, the insurer becomes anxious. They are in the business of saving money, not paying it out. So, if they started paying within 14 days of receiving notice of the claim, they have the right to terminate benefits with 7 days notice within 180 days. However, if the insurer convinces the claimant to sign a form to extend that period up to a year, they can cut the benefits off unilaterally beyond the 180 days. If they paid beyond 180 days (without the form signed), liability would be established and the burden to go before a judge to stop benefits would be on them. If the claimant signs the paper to extend, the burden would be on them to go to a judge to fight for their benefits back. SO, my advice nearly 100% of the time is to NOT sign this form. Please contact Bruce Lipsey at 781-829-9100 for details. Elclaw.com
Before an attorney is hired, much of the time, the insurer will have assigned a nurse case manager to the case. They are generally useful at the start in coordinating appointments and staying on top of the treatment process. However, over time, they are less helpful and more intrusive. As soon as I get retained on the case, I will ask that the nurse case manager is removed. One can’t forget that they are reps for the insurance company and will creep into the claimant’s relationship with their doctor. Some, on occasion, have actively interfered with the relationship and try to convince the doctor that the claimant should be released to work sooner than what the doctor and patient have decided. Please contact Bruce Lipsey at elclaw.com for more information. 781-829-9100
Attorneys’ fees in Social Security Disability claims are set by the Social Security Administration’s commissioner. Currently, the fee is based on a contingency (you win). The fee is 25% of the retroactive award, with a cap of $6,000. So, if the retroactive is $10,000, the fee is $2,500 and that is mailed directly by the government to the attorney without the claimant’s involvement. Please contact Bruce Lipsey at Epstein, Lipsey & Clifford, P.C. for more information. 781-829-9100. blipsey@elclaw.com
As of March 1, 2010, all persons who own or license personal information about a resident of the Commonwealth of Massachusetts must met the minimum standards of 201 CMR 17.00 for the safeguarding of personal information contained in both paper and electronic records. The purpose of the regulation is to protect the security and confidentiality of customer information, protect against anticipated threats or hazards to the security of such information and protect against unauthorized access or use of such information that could result in substantial harm or inconvenience to any consumer.
At the very minimum this requires all businesses that deal with personal information of customers to have a written policy to comply with this regulation. Personal information as defined by 201 CMR 17.02 means “a Massachusetts resident’s first name and last name or first initial and last name in combination with any one of the following data elements that relate to such resident: (a) Social Security number; (b) driver’s license number or state-issued identification card number; or (c) financial account number, or credit or debit card number, with or without any required security code, access code, personal identification number or password, that would permit access to a resident’s financial account; provided, however, that “Personal information” shall not include information that is lawfully obtained from publicly available information, or from federal, state or local government records lawfully made available to the general public.”
If you have any questions or concerns regarding your written policy that is needed to comply with this regulation, please do not hesitate to contact sclifford@elclaw.com.
