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23 hours 45 min ago

By Ron Lieber

The program that public servants can use to have their federal student loans forgiven is such a quagmire for borrowers that Congress had to set up a relief program for the relief program.
So far, it’s not performing much better.
It has been nearly five months since the Department of Education released instructions for a $350 million pot of money that some public servants can use if they received bad information about the loan forgiveness program and ended up in the wrong type of repayment plan.
Tens of thousands of people have applied for the relief program. But so far, most have been rejected, and as of late last month, none among the few thousand who remain in the running have seen their debt balances go to zero.
In response to an inquiry led by Senator Tim Kaine, Democrat of Virginia, the department disclosed last week that 28,207 people had submitted requests as of Sept. 28 and that it had found 21,672 ineligible almost immediately. It then culled “approximately” half of the remaining 6,535 for other reasons. That leaves just over 3,000 applications still under consideration.
It can take up to six months or so to review these requests because of the complexity of both the forgiveness program and the relief fund application process. The Department of Education has shifted some staff to work more closely with the loan servicer that handles the forgiveness program.
The relief fund was created after it became clear that scores of teachers, social workers and other government and nonprofit employees had received bad information from their loan servicers about the forgiveness program’s complex terms. So far, fewer than 1 percent of applicants have had their loans discharged through the program, which got its start just over a decade ago but is only now having borrowers become eligible.
To qualify for tax-free loan forgiveness, borrowers need to make 120 on-time monthly payments (while working in an eligible public-service position), have the right kind of loan (some federal loans qualify while others do not) and be in the right kind of payment plan (the income-driven ones designed to help lower-income borrowers). I explained the process in more detail in an earlier column.
When it became clear in recent years that loan servicers had told public-servant borrowers that they were doing everything right even when they were in the wrong kind of loan or payment plan, pressure grew on elected officials to help borrowers who thought they were being meticulous only
to find that years of payments had not counted for forgiveness.

Enter the Temporary Expanded Public Service Loan Forgiveness initiative, which is a pool of $350 million designed to help borrowers who were in certain ineligible payment plans, often because their loan servicers specifically told them to use those plans or stay in them. The relief program comes with its own rules and restrictions, which I outlined in a previous article and are available on the Department of Education’s website.
Five months in, that website is no model of clarity.
For instance, one paragraph tells borrowers that they must submit a public service loan forgiveness application and wait to be rejected (for payments that were not in a qualifying payment plan) before being potentially eligible for relief. The very next paragraph, however, tells them that they do not need to wait before submitting a request under the temporary plan.
Jolie von Suhr, a psychologist in a state psychiatric hospital in Lakewood, Wash., who was in an ineligible payment plan for years before realizing she had a problem, said the site’s conflicting information left her both perplexed and afraid.
“It kind of sounds like you can submit them both at the same time, but I’m not sure,” she said. “I’m so anxious now about doing anything incorrectly that could get me booted out of consideration.”
In fact, you do not have to wait for a public service loan forgiveness denial in order to request consideration under the temporary expanded program. I asked if the department intended to clarify this on its site and received assurances that it “will continue to review communications to borrowers and will adjust them as appropriate.”
Some eligibility determinations are easier to make than others — rejecting people who have not made 120 payments or who were in an ineligible loan, for example. The Department of Education’s loan servicer often has a tougher time producing an accurate count of months of repayment.
Plus, it now has to account for a rule under the temporary program that applies to people who thought they were in the right kind of repayment plan but found out much later that they were not. They are eligible for the temporary program only if their most recently monthly payment and the
one they made 12 months before their application were higher than what they would have paid if they had been enrolled in a qualifying repayment plan. Yes, it’s complicated, and clearing this hurdle may require documentation.

The Education Department seems tired of bearing blame for all of this.
“We implement the programs Congress creates,” said the department’s press secretary, Liz Hill. She added that the forgiveness program and the temporary program were “poorly constructed programs, the rules of which are highly complex and difficult for students to navigate.”
“We are working to make it as straightforward as the rules allow,” Ms. Hill said.
Some borrower advocates are not surprised by the delays thus far.
“This is a new program in that we’re still in the first year or so of forgiveness applications,” said Betsy Mayotte, president of the Institute of Student Loan Advisors, a nonprofit adviser to debtors. “I have high hopes that the process will become more seamless and quicker over time.”
© 2018 The New York Times Company.  All rights reserved.


2 days 20 hours ago

Student loan debt is a big financial burden for many people. In fact, Americans owe $1.5 trillion in student loan debt, according to data from the Federal Reserve.
While some may find themselves forced to defer or default on your student loans, it's better if you're able to come up with a system to pay them off — and within a modest time frame.
There are two primary reasons to pay down your student loan debt in a reasonable amount of time, Maizie Simpson, data and news editor at Credit Karma, told Business Insider via email.
"The first has to do with interest: The longer you draw out your repayment period, the more interest you'll end up paying," Simpson said. "The second reason is that the longer you have student loan debt, the longer you might put off big life decisions or making investments in your future, such as starting a family or contributing to a 401(k)."
When it comes to paying off your student loans, no matter how intimidating the debt amount is, making an actionable payment plan is key. Here, Elyssa Kirkham, a finance reporter and student loan expert for Student Loan Hero, who paid off a substantial amount of debt herself, took us through a 10-step plan for paying off your student loan debt. 1. Know what you owe Kirkham said that the first step in repaying your debt is to know your debt, especially since you might have taken out several student loans with various lenders. "Many people avoid thinking about or looking at their student debt too closely for a simple reason: Student loans are a huge source of stress," she said.
She suggested using the National Student Loan Data System to find any federal student loans you took out while in college.
"You can also find both federal and private loans listed on your credit report, and check that you're making the proper payments on time each month," Kirkham said. "In addition, record the current balance and interest rate on each student loan." 2. Triage your student loan debt If you are in danger of or already missing student loan payments, Kirkham advised that you try to triage them.
"First, switch federal student loans to an income-driven repayment plan to lower monthly payments," she said. "Then, apply for deferment or forbearance to pause payments if you hit a major financial setback, such as losing a job."
Many private student loan lenders also provide an option to defer payments, Kirkham said. "And keep in mind that unless you have Direct Subsidized Loans, deferred student debt will continue to accrue interest and your balance will increase." 3. Assess other financial considerations Kirkham said to consider if other financial goals need attention before you can go gung-ho on student debt. "If you have other debt, like credit card balances, that are costing you more than your student loans are, it might be wise to pay these off first," she said. 4. Get — and keep — your living costs in check Kirkham suggested that you keep your biggest monthly costs as low and affordable as you can. "I got married right out of college, and my husband and I had borrowed over $40,000 to pay for our educations," she said. "We paid off my student loans right away — about $17,000 within three years of graduating — and we just paid off the remaining student loan balance in July 2018!"
She said that keeping her lifestyle in check was a huge factor that enabled her to pay off her student loans in a timely manner. "I chose more affordable apartments, for example, and shared a car with my husband for years to put off buying a second vehicle," she said.
Kirkham said to take a look at your own monthly spending and rework your budget. "Outline recurring expenses, be critical, and see if there are any you can cut out or trim down," she said. "For instance, can you keep just one of the three video streaming services you're subscribing to? Each dollar you trim from your expenses means an extra dollar you can use to pay off student loan debt." 5. Decide how much to put toward student loans "Once you calculate your set expenses, look at how much is left over," Kirkham said. "This is your discretionary income — money that you are free to decide how and when to spend."
She says you should decide how much of your discretionary income you want to put toward making payments on your student loan debt. "It's best to set a firm dollar amount that you can pay each month," she said.
Kirkham said that although you feasibly could afford to put all of this toward your student loans, it's important to be realistic. "You want to create a spending plan you will actually stick to," she said. 
"Try to cut back on this optional spending without making yourself miserable. For example, I learned to DIY what I could: I cooked at home, worked out at home, and even learned to give myself a pretty great self-manicure." 6. Make extra student loan payments each month Make additional student loan payments each month by setting up an automatic, extra payment to go through after each deposit, Kirkham said. "This puts your student debt goal first and keeps it on track, instead of putting it at the mercy of your spending habits."
However, she said to check your monthly statements to make sure your extra student loan payments are applied properly. "Some servicers will count them as advance payments instead of applying them to your principal, for example," she said. 7. Target high-interest student loans first with the debt avalanche method You may be familiar with the debt avalanche method of paying off credit cards, in which you pay off the highest-interest card first. Well, the same goes for student loans.
"As you pay down this balance, this will also lower the amount of interest you're being charged each month, so your dollars are used to actually lower your principal and get you out of debt," Kirkham said. "If you pay off this first loan, you simply put the amount you were paying (including both the monthly payment and extra payments) toward the student loan with the next-highest interest rate." 8. Refinance certain student loans Another way to target high-interest student loans could be to refinance them, Kirkham said.
"Private student loans and PLUS student loans, in particular, tend to have high enough interest rates that it could make sense to refinance," she said. "You'll need to be well-qualified, but taking this step could help you replace your high-interest student debt with a new private student loan at a lower interest rate."
9. Put any windfalls or raises toward your student debt Kirkham suggested looking for "extra" income that you can use to take a chunk out of your student loan balances, such as tax refunds, bonus pay, cash gifts, raises, and income from side hustles.
"In particular, focusing on growing your income through earning raises, trading up to a better job, or starting a side hustle can be great ways to generate more money you can use to target student debt," she said. 10. Pace yourself and stay motivated "Paying off student loans is a marathon, not a sprint, and it requires similar skills and strategies," Kirkham said. She said to pace yourself and find a budget and student loan system that works best for you.
"Keep your eye on the prize and stay focused on your goal of paying off student loans," she said. "Track your progress and celebrate your wins as you go, from the first extra payment you make to the first student loan you pay off to the last payment you ever send a student loan servicer."  
Copyright © 2018 Insider Inc. All rights reserved.


1 week 1 day ago


A “Suggestion of Bankruptcy” is a document filed in a lawsuit to notify the court that the defendant has filed bankruptcy. Filing such notices with the court is very helpful to the court and to opposing parties so they may cancel upcoming court hearings or pending garnishment orders. Many courts automatically place a pending lawsuit on hold until further order of the bankruptcy court and take affirmative steps to release garnished funds.
Our office files bankruptcy cases electronically and in the next moment we electronically file Suggestions of Bankruptcy with the Nebraska court system. The system is efficient and quick. The goal is to “put out the fire” of collection activity as quickly as possible, and filing Suggestions of Bankruptcy greatly facilitate that goal.
In most cases the bankruptcy results in a discharge of debts, but what happens if the bankruptcy case is dismissed without a discharge? Does the filing of a Suggestion of Bankruptcy mean that the debtor’s bankruptcy attorney has entered a general appearance on behalf of the debtor-defendant? Is the debtor’s attorney in a dismissed bankruptcy case now obligated to defend the debtor in the state court action?
Most bankruptcy attorneys would say no, the filing of a Suggestion of Bankruptcy is not the same thing as filing an Appearance of Counsel. Most would say that the Suggestion is nothing more than a notice and that does not obligate the bankruptcy attorney to defend the lawsuit.
All that changed recently with the Nebraska Court of Appeals issued a new opinion stating that the filing of a Suggestion of Bankruptcy constitutes a General Appearance. By extension, the ruling could also be viewed as stating that the bankruptcy attorney who filed the Suggestion of Bankruptcy has entered an Appearance of Counsel and has a duty to represent the defendant. See Bayliss v Clason, 26 Neb. App 195 (2018).
The relevant text of the opinion is as follows:
“A party will be deemed to have appeared generally if, by motion or other form of application to the court, he or she seeks to bring its powers into action on any matter other than the question of jurisdiction over that party. Id. See Neb. Rev. Stat. § 25-516.01(2) (Reissue 2016).  [The Appellee] argues that by filing the suggestion in bankruptcy and the amended suggestion in bankruptcy, [the defendant] made a general appearance. We agree. . . . By filing the stay, [the defendant] asked the court to bring its powers into action on a matter other than the question of jurisdiction, thus making a general appearance and waiving any defects in the service of process.”
The obvious defect in the court’s reasoning is that a debtor is not asking the court to “bring its powers into action” when a Suggestion of Bankruptcy is filed. To the contrary, the debtor is informing the court that it no longer has any power. The court isn’t invoking any power at all nor is the debtor making such a request. The debtor is merely INFORMING the court of the bankruptcy so it STOPS invoking power.
Bankruptcy attorneys have good reason to be concerned. Although most Chapter 7 cases result in a discharge of debts, Chapter 13 cases frequently fail when debtors are unable to make payments. Roughly 40% of Chapter 13 cases in Nebraska are dismissed without a discharge, and nearly every one of those failed cases involves a bankruptcy attorney who filed multiple Suggestions of Bankruptcy in state court lawsuits.
Are bankruptcy attorneys who file Suggestions of Bankruptcy required to defend clients in state court actions when the bankruptcy case is dismissed without a discharge? Such a ruling would be devastating. Thousands of judgments are entered against debtors after bankruptcy cases fail, and many of those debtors have valid defenses available to them. But bankruptcy attorneys NEVER defend debtors in state court lawsuits when the bankruptcy case is dismissed. They do not believe they have that duty. Their written contracts with the clients frequently state that their representation is limited to the bankruptcy case. Are all these bankruptcy attorneys wrong?
What do Nebraska’s court rules say?
§ 6-1506. Bankruptcy
(A) Civil cases in which a party has been named as a debtor in a voluntary or involuntary bankruptcy petition. In any civil case pending before this court in which a party has been named as a debtor in a voluntary or involuntary bankruptcy petition, a Suggestion of Bankruptcy and either (1) a certified copy of the bankruptcy petition, (2) a copy of the bankruptcy petition bearing the filing stamp of the clerk of the bankruptcy court, or (3) a copy of a “Notice of Bankruptcy Case Filing” generated by the Bankruptcy Court’s electronic filing system shall be filed by the party named as a debtor or by any other party with knowledge of the bankruptcy petition. Upon the filing of the Suggestion of Bankruptcy and one of the three bankruptcy documents noted immediately above, no further action will be taken in the case by the court or by the parties until it can be shown to the satisfaction of the court that the automatic stay imposed by 11 U.S.C. § 362 does not apply or that the automatic stay has been terminated, annulled, modified, or conditioned so as to allow the case to proceed. Such a showing shall be made by motion.
(B) Requests for disbursement of funds or distribution of property of or to a party named as a debtor in a bankruptcy proceeding. In any civil case in which a Suggestion of Bankruptcy and one of the three bankruptcy documents noted in § 6-1506(A) have been filed, no request for a disbursement of funds or distribution of property of or to a party named as a debtor shall be made, and no order disbursing funds or distributing property of or to a party named as debtor will be entered. A request for disbursement of funds or distribution of property may be made after a showing, satisfactory to the court, that such funds or property has been abandoned by the trustee in bankruptcy or that the funds or property has been exempted by the debtor in the bankruptcy proceedings or that the party named as debtor in the bankruptcy petition, rather than the trustee in bankruptcy, is otherwise entitled to disbursement of such funds or distribution of such property. Such a showing shall be made by affidavit.
Nebraska Court Rule § 6-1465 says the exact same thing.
Unfortunately, these court rules do not answer the question. They talk about the filing of Suggestions of Bankruptcy, but they do not state whether such a filing also constitutes an Appearance of Counsel and thus obligate the bankruptcy attorney to defend the lawsuit.
In the absence of a clear rule, bankruptcy attorneys are choosing to not file any notice of the bankruptcy in state court lawsuits, and that’s a bad development. The immediate response to this new ruling was full of fear and anger:

“If I were a creditor’s attorney, I would be very upset and concerned with this decision. This just made their life a whole lot worse and expensive for their clients. Ultimately, the Stay is in effect and if you immediately notify opposing counsel, informally but with certainty, then their client is on notice. If garnishments and/or executions don’t stop IMMEDIATELY, guess who is going to have to undo/fix all of that stuff? Debtor attorneys have always done the Suggestions of Bankruptcy and it is a SERVICE to the state court and a service to creditors and to their wallet. Just think about how much time and energy is saved by having Debtor’s attorney provide this service FREE of charge! And, now, we get pulled in as making a “general appearance?” No way. We don’t get paid nearly enough for that responsibility.”

Courts will not be aware of the bankruptcy and may continue with hearings or enter judgments that will later be declared to be void. Collection attorneys will be delayed in learning of the bankruptcy case and may face increased pressure to disgorge garnishment funds and may face sanction motions more often in bankruptcy cases when they ignorantly garnish debtors after the bankruptcy is filed. This is not good. Effectively penalizing bankruptcy attorneys who diligently notify the court of the bankruptcy case by imposing an obligation of defending the debtor in state court will cause bankruptcy attorneys to stop filing such notices. That is not a healthy development. I have heard from attorneys in other states with this problem and they solve it by having clients mail in the bankruptcy notice themselves thus causing a delay in notifying courts of the bankruptcy by days. A policy that leads to less communication of vital facts to the court is simply bad policy.
Nebraska court rules need to be amended immediately to clearly indicate whether the filing of a Suggestion of Bankruptcy shall be considered a General Appearance by the debtor and/or as an Appearance of Counsel by the bankruptcy attorney.  Bankruptcy attorneys do a great service to the court system by filing Suggestions of Bankruptcy, and our court rules should be clarified to allow them to continue providing such valuable information without fear of becoming involved in the underlying state court lawsuit.
Image courtesy of Flickr and jo.sau
 


1 week 6 days ago

Understanding the bankruptcy process can be a daunting undertaking. However, if you break it down into manageable sections, it can be easier to understand. Keep reading the following sections to learn more about the bankruptcy process and how it applies to your individual situation: Bankruptcy Explained, Bankruptcy Types, Why Should You File Bankruptcy, When Should You File Bankruptcy, and Bankruptcy Costs.
The post Understanding Arizona Bankruptcy appeared first on Tucson Bankruptcy Attorney.


2 weeks 3 hours ago

The September 2018 New York City Taxi & Limousine Commission (TLC) sales results have been released to the public. And as is our practice, provided below are Jim Shenwick’s comments about those sales results.
1. The volume of transfers rose from August. In August, there were 54 unrestricted taxi medallion sales.
2. 44 of the 54 sales were foreclosure sales, which means that the medallion owner defaulted on the bank loan and the banks were foreclosing to obtain possession of the medallion. We disregard these transfers in our analysis of the data, because we believe that they are outliers and not indicative of the true value of the medallion, which is a sale between a buyer and a seller under no pressure to sell (fair market value).  One transfer was an estate sale for no consideration and another transfer was from the dissolution of a partnership, which also does not reflect fair market value and which we have also excluded from our analysis.
3. However the large volume of foreclosure sales (approximately 81%) is in our opinion evidence of the continued weakness in the taxi medallion market.
4. The eight regular sales for consideration ranged from a low of $160,000 (three medallions), $175,000 (two medallions), $180,000 (one medallion) and a high of $200,000 (two medallions).
5.  Accordingly, the median value of a medallion in September was $175,000, the same as in August.
In Jim Shenwick’s opinion, the new NYC law restricting the number of Uber, Via and Lyft licensesdoes not seem to have yet increased the value of taxi medallions.
Please continue to read our blog to see what happens to medallion pricing in the future. Any individuals or businesses with questions about taxi medallion valuations or workouts should contact Jim Shenwick at (212) 541-6224 or via email at jshenwick@gmail.com.


2 weeks 1 day ago

Aaron Elstein

Lomto Federal Credit Union of Queens, which failed last year after taxi loans unleashed a shower of red ink, was acquired today by Teachers Federal Credit Union.
The acquisition comes exactly a month after Teachers Federal acquired another Queens institution done in by dud taxi loans: Melrose Credit Union.
Lomto and Melrose, along with the failed Montauk Credit Union and First Jersey Credit Union, were specialists in lending to buyers and owners of taxi medallions, the metal plates that confer the right to drive a cab. Before the rise of ride-hailing apps in 2014, the value of a taxi medallion soared to more than $1 million, and lenders came to see the loans as virtually risk-free. New York taxi medallions now sell for less than $200,000, often in foreclosure auctions.
Signature Bank and Medallion Financial also have reported big losses from taxi lending. The unraveling of the business has taken a toll on cabbies and medallion owners.
The city's leading medallion owner, Evgeny "Gene" Freidman, pleaded guilty in May to tax fraud related to his taxi business.
And on Sept. 18 Michael Cohen, President Donald Trump's former attorney, divested 10 medallions he controlled. The city forced the sale after Cohen pleaded guilty in August to eight criminal charges, including tax evasion related in part to the concealment of income generated by his medallions.
Copyright © 1996-2018. All Rights Reserved.


2 weeks 2 days ago

Retiring Chapter 13 Trustee in Seattle
After more than 19 years as the Chapter 13 Trustee in Seattle, Mike Fitzgerald will retire on September 30, 2918. The United States Trustee has announced the appointment of Jason Wilson-Aguilar as the Chapter 13 Standing Trustee for Seattle, effective October 1, 2018.
After nearly two decades as the Chapter 13 Trustee in Seattle, Mike Fitzgerald retired on September 30, 2018. The United States Trustee has announced that Jason Wilson-Aguilar will be replacing him as the Chapter 13 Standing Trustee for Seattle starting today.
Jason Wilson-Aguilar was Senior Staff Attorney and Legal Department Manager of the Chapter 13 Trustee’s Office for roughly a decade prior to becoming Standing Trustee. He was previously Vice President and Counsel in the Home Loans and Consumer Lending Division of Washington Mutual Bank’s Legal Department. Mr. Wilson-Aguilar has represented both debtors and creditors in consumer bankruptcy cases in both Washington and Oregon. He has been a prolific writer and presenter on bankruptcy and foreclosure-related topics over the years and has long ties to the region. He received his B.A. from the University of Oregon and was awarded his J.D. from the Lewis and Clark Law School in Portland, Oregon.
Debtors currently in Seattle area Chapter 13 will likely encounter little if any changes in any aspect of the way their cases are currently being handled because Mr. Wilson-Aguilar has been actively overseeing their cases for some time.
Please let us know in the months to come If you do have any questions about how the change in Trustees might affect you. We are happy to help.
The post Chapter 13 Trustee in Seattle appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief.


2 weeks 2 days ago

By Katy Stech Ferek
WASHINGTON—The legal professionals who ensure people going through bankruptcy aren’t hiding assets are pushing lawmakers for their first pay raise since 1994, saying the robust oversight of the country’s personal-bankruptcy system is at stake.

In a House hearing on Wednesday, consumer-bankruptcy experts said the pay for the watchdogs, called bankruptcy trustees, should be doubled to $120 per case.

The experts said trustees play a vital role in the bankruptcy process by making sure people don’t hide valuable possessions and by returning recovered money to people and small businesses who are awaiting payment. Many are drawn to the work not for the pay, but for the prestige or public-service aspect. For most bankruptcy cases, they get only a flat fee, currently $60—far less than what they could earn for other legal work.

Roughly 1,100 trustees monitor chapter 7 cases, the most widely used form of bankruptcy for individuals. But during the hearing before a subcommittee of the House Judiciary Committee, experts testified they worried that the stagnant pay would lead to fewer competent, honest applicants. Last year, 20 candidates applied for every open chapter 7 trustee position, down from 58 in 2010, according to the Justice Department, which runs the program.

At the hearing, Rep. Tom Marino (R., Pa.) agreed with witnesses, calling trustees “vitally important” to the bankruptcy system. Mr. Marino is co-sponsor of a bipartisan bill that would raise trustees’ pay.

He said lawmakers agree the increase is necessary but they have “different paths to getting there,” referring to who should pay for it.

Trustees can uncover money and return it to pay off a bankrupt person’s debt to small businesses, credit-card companies and other individuals such as ex-spouses, Illinois trustee Neville Reid testified at the hearing. Taxpayers also benefit, he said, noting that chapter 7 trustees distributed roughly $170 million to state and federal tax authorities in 2016.

“Trustees frequently uncover schemes and wrongdoing that lead to prosecutions that prevent further injury or achieve justice for innocent people, even though the trustees frequently do not recover the value of their time investigating such matters,” Mr. Reid said.

The bill discussed at Wednesday’s hearing has support from two influential blocs, the American Bankers Association trade group and consumer-bankruptcy advocates. Several similar proposals have failed in the past.

The latest legislation would fund the pay increase by making bankrupt individuals pay higher fees.

Some lawyers and consumer-focused nonprofits are urging Congress to find another source of money to pay for the increase, such as a new fee for those filing requests for payment from someone going through bankruptcy.

Chapter 7 allows a financially troubled individual to sell property to repay certain bills before a judge cancels some unpaid debt, such as credit-card and medical bills. Last year, 472,190 individuals and couples filed for chapter 7 protection.

Trustees can also receive a second form of compensation beyond the flat fee: money from selling possessions and property valued above the limits of what a bankrupt person is allowed to keep. But cases with trustee sales are rare, occurring less than 10% of the time.

Under federal law, chapter 7 trustees review lists of individuals’ possessions and expenses and later question them in person. The compensation structure gives trustees incentives to look for hidden assets, but the model isn’t always successful. Jason Gold, a Washington, D.C., trustee, said that in at least 2,000 cases—nearly 8% of the total he has taken since 1989—he has spent a few hours to several days on a case only to realize there are no additional assets to sell.

Overall trustee compensation has fallen over the past six years, including an 18% drop in annual pay last year, Justice Department officials said. The decline comes as the number of people who file for bankruptcy each year has fallen since a 2010 peak.

Meanwhile, the number of bankrupt people who are so poor that they don’t have to pay the fee has increased in recent years. The number of chapter 7 cases with waived fees has grown to 4.7% in 2016 from 1.9% in 2007, testified Raymond Obuchowski, a Vermont-based trustee. Mr. Obuchowski has grown a long beard in protest of trustees’ pay, saying he won’t shave until Congress authorizes a raise.

Some consumer advocates say the low pay and drop in filings have driven trustees to be more aggressive in an attempt to boost their compensation.

Tara Twomey, executive director of the National Consumer Bankruptcy Rights Center, said trustees have gotten more creative in their recovery efforts since 2010, including by trying to sell property that bankrupt people would have historically been able to keep. Others have sued colleges to claw back tuition that bankrupt parents paid for their children.

Ms. Twomey supports the compensation increase but doesn’t want bankrupt people to pay for it. She and other consumer advocates said that a 2005 law already increased the costs of a system designed to help people who are financially struggling.

Rep. David Cicilline (D., R.I.) said he wouldn’t vote for the bill in its current form, saying the cost of bankruptcy is already “a great challenge for many people.”
 
Corrections & Amplifications

Jason Gold became a chapter 7 trustee in 1989. An earlier version of this article incorrectly said it was in 1998. (Sept. 26, 2018)

Copyright ©2018 Dow Jones & Company, Inc. All Rights Reserved.


3 weeks 2 days ago

By  | Sept. 21, 2018 Nic Hunt has been driving a taxicab in New York City for more than 30 years. Hunt’s best friend, Nicanor Ochisor, died by suicide in March. Friends and family members of Ochisor, who was also a cab driver, believes his suicide was the result of financial pressure due to increased competition for passengers with ride-hailing apps like Uber and Lyft.
“I still have texts in my phone when he text[ed] me. ‘Half an hour I couldn’t pick up a passenger’ or ‘40 minutes, I couldn’t find a passenger,’” Hunt said on Mic Dispatch.

Six taxicab drivers in NYC have died by suicide since November, sparking protests and rallies aimed at protecting drivers’ wages. Lyft’s revenue soared to $1 billion in the fourth quarter of 2017; in the second quarter of 2018, according to a Bloomberg report, Uber generated $2.8 billion in sales. 2017 also marked the first year Uber outpaced yellow taxis: Uber provided more than 400,000 trips per day in NYC that year, compared to around 300,000 per day for yellow taxis.

Meanwhile, NYC’s taxicab revenue dropped 9% in 2016, and operating your own cab by purchasing a coveted taxi medallion also means drowning in debt for many drivers. NYC taxi medallions, often passed from generation to generation, were once considered safe investments — in 2014, a medallion was worth as much as $1.3 million. Today, many of those medallions are worth much less than what drivers borrowed to buy them, something many attribute to the rise of Uber and Lyft.

According to retail website nycitycab.com, a medallion now retails for as low as $100,000. The cheapest medallion currently on the site is being sold as part of a foreclosure sale, a growing trend among taxi drivers around the country right now. In Chicago, 774 taxi medallions had been surrendered to the city as of May 22, 2017, with drivers unable to afford taxes and license fees associated with ownership. Many of those end up moving to foreclosure.

“You sleep like two, three hours, then you wake up and you turn around in bed,” Hunt said. “It’s a difficult time, mortgage for the medallion, mortgage for the house. One time I didn’t feel good and I told my wife, ‘I’m going to the hospital, I won’t come home.’ I had an anxiety attack in my physician doctor’s office. So then I find out I suffer [from] depression.”

But there’s hope for some cab drivers, at least, in NYC. According to the New York City Taxi and Limousine Commission’s rulebook, one of its duties is to establish and enforce standards to ensure all taxi driver licensees remain “financially stable.” In August, NYC became the first major metro area to aid drivers affected by the rise of ride-hailing apps: The New York City Council passed legislation to “cap the number of for-hire vehicles for a year.” and to establish minimum pay rates for taxi drivers, the New York Times reported.

“More than 100,000 workers and their families will see an immediate benefit from this legislation,” Mayor Bill de Blasio said on Twitter. “And this action will stop the influx of cars contributing to the congestion grinding our streets to a halt.”

Not everyone agrees with de Blasio. Thirty-nine council members voted in support of the cap on licenses, but Councilman Eric Ulrich was one of six who opposed it.

“I believe in capitalism,” Ulrich said on Mic Dispatch. “Standing in the way of Uber, as I said on the floor with [the] City Council, would be like standing in the way of Netflix because we wanted to save Blockbusters from closing.”

Uber communications manager Alix Anfang said the regulation will threaten “one of the few reliable” transportation options in the city.

“As Uber continues to grow in communities outside of Manhattan, we will do whatever it takes to ensure that no New Yorker who needs a ride is left stranded,” Anfang said in an email.

Uber drivers serve more boroughs than yellow cabs do, with 22% of Uber rides starting outside of Manhattan compared to just 14% of all yellow and green cabs (also known as Boro Taxis, a fleet of cabs deployed specifically for travel outside of Manhattan).

Joseph Okpaku, Lyft’s vice president of public policy, reiterated the importance of its service for outer-borough travel in an emailed statement.

“These sweeping cuts to transportation will bring New Yorkers back to an era of struggling to get a ride, particularly for communities of color and in the outer boroughs,” Okpaku said. “We will never stop working to ensure New Yorkers have access to reliable and affordable transportation in every borough.”

And while regulations on Uber and Lyft could be good news for taxi drivers, it’s only a temporary solution — and only one of the issues affecting drivers who struggle to compete against corporate behemoths like Uber.

“They stopped the bleeding now — no more bleeding for one year,” Hunt said. “But the fight is just beginning.”

Check out episode 20 of Mic Dispatch above — only on Facebook Watch.

© 2018 Mic Network Inc. All rights reserved.


3 weeks 6 days ago

The best ways handle Amending Bankruptcy Forms in Tacoma
Amending bankruptcy forms is usually necessary if you discover a mistake in your bankruptcy forms, petition, schedules, or other paperwork, you can fix it easily by filing an amended version of the form. The bankruptcy rules enable filers to amend their forms any time prior to they receive a final discharge.
Filing an Amended Bankruptcy Form in Tacoma
To remedy an error on a form, you’ll need a blank copy of the form. You will also need to find out if the Tacoma bankruptcy court has a local form you should utilize to file an amendment.
Some courts enable you to complete only the portion of the form that was inaccurate, leaving the rest blank (other than for your name, case number, and other identifying info). As soon as you’ve finished the amended form in the manner recommended by your court, you’ll check the “Check if this is an amended filing,” box in the upper right-hand corner or you may need to write the word “AMENDED” next to the form title.
Amending bankruptcy forms may require you to complete and file several forms, even if you made just one error. For instance, if you forgot to list the lender holding the note to your automobile, you might need to amend Schedule C: The Property You Claim as Exempt (if you plan to declare that the equity in the car is exempt), and Schedule D: Creditors Who Have Claims Secured by Property.
You Must Complete the Declaration About Individual Debtor’s Schedules
You state under penalty of perjury that all of the contents are appropriate and true by signing the Declaration About Individual Debtor’s Schedules when you submit your bankruptcy petition. Because your initial declaration will not cover the brand-new information you send to the court, you need to complete and file a brand-new declaration with your amended schedules.
Filing Your Completed Forms in Tacoma
As soon as you have completed amending bankruptcy forms, finished a brand-new declaration, and completed any local forms you need to file with your amended paperwork, you will need to file the amendments with the bankruptcy court and pay a fee.
File the amended forms and schedules with the bankruptcy court, following the court’s instructions regarding what order the forms need to be in, the number of copies is required, whether you have to consist of a cover sheet or letter describing the modifications, and so on. You should likewise serve a copy of the amended papers to the bankruptcy trustee and to any financial institution impacted by your amendment.
When You Should Speak to a Tacoma Bankruptcy Lawyer
The bankruptcy rules permit debtors to file modifications to their bankruptcy documents any time prior to they receive the final discharge. However, if you need to file an amended Schedule C, and the judge won’t allow it, you need to speak with an experienced bankruptcy attorney from our Tacoma bankruptcy law office.
The Best Way to Amend Bankruptcy Forms in Tacoma
Many things can go wrong in a bankruptcy when you try to do it yourself or with a non-attorney bankruptcy preparer. The best way to correct a mistake on your bankruptcy forms is to not make it in the first place. Amendments can be problematic and if you are unrepresented, it is up to you to figure out the rules and procedures. You can avoid most common mistakes and ensure your bankruptcy goes smoothly by hiring an experienced Tacoma bankruptcy attorney from Northwest Debt Relief Law Firm. Give us a call. We’re here to help.
The post Amending Bankruptcy Forms appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief.


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