Blogs

7 hours 17 min ago

Crain’s New York recently reported that based upon a bankruptcy filing by a company (Hypnotic Taxi LLC) owned by Evgeny “Gene” Friedman, an auction held September 18th, 2017  the answer is about $186,000 .  Maltz Auctions was the auctioneer, at the LaGuardia Marriott Hotel, of 46 medallions that were assets of the bankruptcy estate in In re Hypnotic Taxi LLC.  This case involved medallion owner Evgeny “Gene” Friedman, who once owned 800 medallions, resulting from a foreclosure by Citibank and tax fraud charges.
With the 6% buyer premium owed to Maltz, the purchase price was about $198,000 per medallion or $9.1M in total for all 46 medallions.
According to Crain’s New York, the winning bidder was out of state hedge fund MGPE, Inc.  A hearing to confirm the results of the sale will be held in the U.S. Bankruptcy Court for the Eastern District of New York on September 25th.  Accordingly, based on the auction results for the 46 medallions at the Maltz auction, the value of medallions appears to be $198,000. The banks that have financed NYC medallions may argue that one auction (albeit of 46 medallions) is not the indicator of true value, others may argue that yesterday’s auction results are a true indicator of medallion value. Jim Shenwick.


16 hours 18 min ago

BEWARE HIGH-VOLUME TAX HELP ADVERTISERS

Evening TV commercials offering to help taxpayers with tax debts.They promise to help you solve your delinquent tax problems. But are they legit?
High volume advertisers typically collect hefty retainer fees from a large number of burdened taxpayers, make quick, superficial efforts to protect the taxpayers, often accomplish nothing – then change their names and come back the next week with more high-volume advertising. Some evenings five or six different advertisers make their pitch on local T.V.

Continue reading


1 day 4 hours ago

Here at Shenwick & Associates, we are continuing to monitor litigation regarding the taxi medallion industry.  Earlier this year, the Taxi Medallion Owner Driver Association (TMODA)along with credit unions that invested in taxi medallions and other plaintiffs commenced an action in the U.S. District Court for the Southern District of New York (federal court) against New York City and the Taxi and Limousine Commission (TLC), claiming that the TLC’s rules deny taxi drivers equal protection and due process because Uber and Lyft drivers aren’t required to comply with the same TLC regulations as medallion owners.  That action was dismissed in March, finding that the difference between taxis and alternative services justified the differences in the rules.  That case has been appealed to the Second Circuit Court of Appeals and scheduled for argument on October 24th, 2017.
In April, the TMODA sent a letter to Governor Cuomoasking for a moratorium on medallion foreclosures.  In May, the TMODA filed an Article 78 proceeding in New York County Supreme Court (which included two taxi drivers as co–plaintiffs), seeking to compel the TLC “to establish and enforce standards to ensure . . . yellow medallion taxicabs, are and remain financially stable.”  A hearing in that special proceeding will be held on October 24th, 2017.
We will continue to monitor taxi medallion litigation and provide readers of our e-mails and blog with updates.  If you have an underwater medallion or other debtor and creditor and bankruptcy questions, please contact Jim Shenwick.


1 week 4 hours ago

By WINNIE HU

Owning a yellow cab has left Issa Isac in deep debt and facing a precarious future.
It was not supposed to turn out this way when Mr. Isac slid behind the wheel in
2005. Soon he was earning $200 a night driving. Three years later, he borrowed
$335,000 to buy a New York City taxi medallion, which gave him the right to operate
his own cab.

But now Mr. Isac earns half of what he did when he started, as riders have
defected to Uber and other competitors. He stopped making the $2,700-a-month
loan payment on his medallion in February because he was broke. Last month, it was
sold to help pay his debts.

“I see my future crashing down,” said Mr. Isac, 46, an immigrant from Burkina
Faso. “I worry every day. Sometimes, I can’t sleep thinking about it. Everything
changed overnight.”

Taxi ownership once seemed a guaranteed route to financial security, something
that was more tangible and reliable than the stock market since people hailed cabs in in good times and bad. Generations of new immigrants toiled away for years to earn enough to buy a coveted medallion. Those who had them took pride in them, and viewed them as their retirement fund.

Uber and other ride-hail apps have upended all that.

Just as homeowners faced ruin when housing markets sank, struggling cab
owners in Chicago, Boston, San Francisco and other cities are now facing foreclosure
and bankruptcy. Many took out loans to pay for taxi medallions, counting on
business that has instead nose-dived amid fierce competition. They are falling
behind on loan payments, being turned away by lenders and stand to lose not only
the medallions that are their livelihoods but also their homes and savings.

Nowhere is the crisis more dire than in New York, which has the largest taxi fleet in
the country. Medallions now sell for a fraction of the record $1.3 million price in
2014, and in many cases, are worth far less than what their owners borrowed to buy
them. Even if these owners sell their medallions, they still owe hundreds of
thousands of dollars — far more than in many other cities where medallion prices
were lower to begin with.

In an unprecedented fire sale of medallions, up to 46 of them are expected to go
on the auction block later this month as part of bankruptcy proceedings against taxi
companies affiliated with an embattled taxi mogul. While the city has previously held
auctions to sell a limited number of new medallions — about 1,800 since 1996 — this
is believed to be the first auction to dispose of foreclosed medallions, according to
city officials.

While the auction has drawn attention to the precipitous fall of the once-mighty
taxi industry, it does not reflect the hardship — and heartbreak — of individual
owners like Mr. Isac. It is their stories that often get lost in the larger debate over
new technology and commutes, and tell of the human cost of the city’s rapidly
evolving transportation landscape.

Since 2015, a total of 85 medallions have been sold as part of foreclosure
proceedings, according to city records. In August alone, 12 of the 21 medallion sales
were part of foreclosures; the prices of all the sales ranged from $150,000 to $450,000 per medallion.

Many more taxi owners say they do not know how much longer they can hold
on. Didar Singh, 65, who took out a loan to buy two medallions for a total of $2.6
million in 2013, said he can only afford to pay the interest — $4,816 a month — on
the loan. As it is, his taxis do not bring in enough to cover his expenses, forcing him
to rely on savings and help from his children.

Sohan Gill once saw his medallion as such a good investment — ”better than a
house” — that his wife bought two more in 2001. Now they cannot find enough
drivers for the cabs because business is so bad. And Mr. Gill, 63, who had retired
from driving, had to go back on the road. “How many more years am I going to drive
to take care of these medallions?” he asked.

Gone are the years when taxi medallions steadily rose in value, largely because
there was a limited supply of them. The city controls the number of medallions —
currently capped at 13,587 — to prevent an oversupply of cabs like what occurred in
the 1930s when concerns over congestion, reckless driving and cut-rate fares
prompted the city to step in. The last time there was an auction for medallions was
when the city sold 350 new medallions in 2014 at the height of the market,
generating $359 million in revenue.

But today, yellow cabs are dwarfed by cars working for ride-hail apps, which
face far fewer regulations. Taxi owners and their supporters complain that their
competitors do not have a similar cap on their cars, and are not subject to strict rules
on taxis that cover fares, vehicle equipment and access for disabled people, among
other things.

There are more than 63,000 black cars providing rides in the city through five
major app services: Uber, Lyft, Via, Gett and Juno. Of those, about 61,000 cars are
connected with Uber, though they may also work for the other app services, too.

“We are not against competition, we are not against technology, but we want to
compete fair and square,” said Nino Hervias, 58, a taxi owner and spokesman for the
Taxi Medallion Owner Driver Association, which represents about 1,500 individual
taxi owners, most of whom are immigrants.

Taxi owners have sought to sue the city over what they see as an unfair playing field, with little success. Earlier this year, a lawsuit filed against the city and taxi
commission by taxi owners, trade groups and credit unions was dismissed by a
federal judge who found that they had failed to show they were denied due process
or equal protection.

Mr. Hervias and another driver have also taken legal action, known as an Article
78 proceeding, to compel the city and its regulators to establish and enforce
standards that will make sure that all licensed cars — including yellow cabs — “are
and remain financially stable.” The case is pending in State Supreme Court in
Manhattan, with a court appearance scheduled in October.

Yellow taxis made an average of 277,042 daily trips and collected $4 million in
fares per day in July, down from 332,231 daily trips and $4.9 million in fares the
year before, according to city data.

Allan J. Fromberg, a spokesman for the taxi commission, said it had taken a
number of steps to help struggling taxi owners, such as lifting a requirement for
individual owners to personally drive their taxis at least 150 shifts a year, which was
not only a burden for older people but also limited the pool of potential buyers for
medallions. It has also supported laws that have eased restrictions on who could buy
the medallions and significantly lowered the transfer tax on medallion sales.

The commission has also provided financial incentives to defray the cost and
maintenance of handicap-accessible cars, Mr. Fromberg said. And it has created a
pilot program that is intended to help fleet owners attract more drivers; the program
allows drivers to pay a percentage of their earnings during a shift to lease the cab, in
lieu of a flat fee up front that puts drivers under pressure and leaves them in the hole
if they do not earn enough back.

But for many taxi owners, such measures have not been enough.

Mr. Isac is again leasing yellow cabs since he no longer has his own medallion.

At times, he picks up only one passenger an hour. Even so, he is not ready to give up
on yellow cabs yet.

“I’m still driving a yellow taxi because I want them to come back,” he said. “I don’t want to see yellow cars disappear from the streets.”

Uppkar Thind, 46, an immigrant from India, said he now has to drive 11 to 13
hours a day and can no longer take time off if he wants to break even. He is paying
off a medallion that he bought for $357,000 in 2006 with money borrowed from his
relatives and a credit union.

“I worked hard,’’ he said. “I achieved my American dream and it turned into a
nightmare.”

Copyright 2017 The New York Times Company.  All rights reserved.


1 week 5 days ago

When filing a Chapter 7 and 13 you must:
1. Reside, be domiciled, or have property or a place of business in the United States (U.S.). A person does not have to be a U.S. citizen to file, nor live in the U.S., if they have assets in the U.S.
2. You can file if you do not have a prior Chapter 7 discharge or it has been more than 8 years, or 6 years since a Chapter 13 discharge.
The post Whether to file a Chapter 7, 13, or 20? appeared first on Tucson Bankruptcy Attorney.


2 weeks 5 hours ago

On June 26, 2017, the Supreme Court granted certiorari in PEM Entities v. Levin to decide whether bankruptcy courts should apply a federal multi-factor test or an underlying state law when deciding whether to re-characterize a debt claim as equity. The Court’s decision to grant cert in this case should resolve a circuit split and clarify the law as it relates to re-characterizing corporate debt as equity. Read More ›
Tags: 6th Circuit Court of Appeals, Chapter 11, U.S. Supreme Court


2 weeks 5 hours ago

Two years have passed since the United States Supreme Court passed down a 5-4 decision in Obergefell v. Hodges which held that same-sex couples have a fundamental right to marry under both the Due Process and Equal Protection Clauses of the Fourteenth Amendment. Read More ›
Tags: U.S. Supreme Court, Zoning & Land Use


3 days 19 hours ago

Debt settlement a bad alternative to bankruptcy
By Liz Weston NerdWallet.com, Aug 30, 2017 (a summary from South Bend Tribune)
Many people believe that hiring a company to settle their debts is better on their credit, will cost them less in the long run and will generally be better than a bankruptcy.  This is what the debt settlement industry would like you to believe.  The following are some clips from an article by Ms. Weston which details the real cost of debt settlement.
debt settlement Debt settlement is not as consumer-friendly as the industry presents it, and some of the people who praised the companies didn’t fully understand their alternatives or the longer-term consequences of settling debt (see a former employee’s quote below).

  •  One woman didn’t realize she would face a tax bill on the forgiven debt.
  • A man opted against bankruptcy in part because he erroneously thought he would lose personal possessions.
  • Another woman was shocked at how far her credit scores tumbled and how much interest she was charged when she applied for a car loan.

Where debt settlement falls short
debt settlementHere are some of the biggest problems with debt settlement:

  • Negotiations can take years (usually three to four years). Meanwhile, customers risk being sued over their debts.
  • The math often doesn’t work. The total cost of the settlement can equal 90 percent or more of the original amount owed.
  • Many debt settlement companies unfairly demonize bankruptcy. In reality, most chapter 7 bankruptcies take a few months and the filer can keep most of their assets.
  • Both debt settlement and bankruptcy drop credit scores into the mid-500s. Credit scores can begin to recover immediately after either process is complete (chapter 7 bankruptcy typically takes months, while debt settlement typically takes years.) Plus, bankruptcy halts collections activity, including lawsuits, and can end wage garnishments.

“The one option that shines above all the rest is bankruptcy,” says Steve Rhode, a former credit counselor who runs the Get Out of Debt Guy advice site. “It’s the cheapest and fastest and the best way to rebuild your credit.”

Share this entry

About the Author:
Diane L. DrainDiane L. Drain is a well known and respected Arizona bankruptcy attorney. She is an expert in both consumer bankruptcy and Arizona foreclosure. Since 1985 she has been a dedicated advocate for her clients and spokesperson for Arizona citizens. Diane is a retired professor of law teaching bankruptcy for more than 20 years. As a teacher she believes in offering everyone, not just her clients, advice about the Arizona bankruptcy laws. She is also a mentor to hundreds of Arizona attorneys.
I would be flattered if you connected with me on GOOGLE+
*Important Note from Diane: Nothing on this website should be construed as establishing a lawyer-client relationship between you, me, the author of any page or the website owner (me) who happens to be a lawyer.  Everything on this web site is available for educational purposes only, is not intended to provide legal advice nor create an attorney client relationship between you, me, or the author of any article.  You may pick up some information about bankruptcy, foreclosure or the practice of law written by myself or others.  Any information in this web site should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state.*

The post Debt settlement a bad alternative to bankruptcy appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.


2 weeks 2 days ago

Debt settlement a bad alternative to bankruptcy
By Liz Weston NerdWallet.com, Aug 30, 2017 (a summary from South Bend Tribune)

Many people believe that hiring a company to settle their debts is better on their credit, will cost them less in the long run and will generally be better than a bankruptcy.  This is what the debt settlement industry would like you to believe.  The following are some clips from an article by Ms. Weston which details the real cost of debt settlement.

debt settlement Debt settlement is not as consumer-friendly as the industry presents it, and some of the people who praised the companies didn’t fully understand their alternatives or the longer-term consequences of settling debt (see a former employee’s quote below).

  •  One woman didn’t realize she would face a tax bill on the forgiven debt.
  • A man opted against bankruptcy in part because he erroneously thought he would lose personal possessions.
  • Another woman was shocked at how far her credit scores tumbled and how much interest she was charged when she applied for a car loan.

Where debt settlement falls short

debt settlementHere are some of the biggest problems with debt settlement:

  • Negotiations can take years (usually three to four years). Meanwhile, customers risk being sued over their debts.
  • The math often doesn’t work. The total cost of the settlement can equal 90 percent or more of the original amount owed.
  • Many debt settlement companies unfairly demonize bankruptcy. In reality, most chapter 7 bankruptcies take a few months and the filer can keep most of their assets.
  • Both debt settlement and bankruptcy drop credit scores into the mid-500s. Credit scores can begin to recover immediately after either process is complete (chapter 7 bankruptcy typically takes months, while debt settlement typically takes years.) Plus, bankruptcy halts collections activity, including lawsuits, and can end wage garnishments.

“The one option that shines above all the rest is bankruptcy,” says Steve Rhode, a former credit counselor who runs the Get Out of Debt Guy advice site. “It’s the cheapest and fastest and the best way to rebuild your credit.”

Share this entry

About the Author:
Diane L. DrainDiane L. Drain is a well known and respected Arizona bankruptcy attorney. She is an expert in both consumer bankruptcy and Arizona foreclosure. Since 1985 she has been a dedicated advocate for her clients and spokesperson for Arizona citizens. Diane is a retired professor of law teaching bankruptcy for more than 20 years. As a teacher she believes in offering everyone, not just her clients, advice about the Arizona bankruptcy laws. She is also a mentor to hundreds of Arizona attorneys.
I would be flattered if you connected with me on GOOGLE+
*Important Note from Diane: Nothing on this website should be construed as establishing a lawyer-client relationship between you, me, the author of any page or the website owner (me) who happens to be a lawyer.  Everything on this web site is available for educational purposes only, is not intended to provide legal advice nor create an attorney client relationship between you, me, or the author of any article.  You may pick up some information about bankruptcy, foreclosure or the practice of law written by myself or others.  Any information in this web site should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state.*

The post Debt settlement a bad alternative to bankruptcy appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.


3 days 19 hours ago

“This is What Happens to Student Loans When You Die”.
student loans
The following is a summary of USA Today article.
It is important that you know the type of student loan (federal or private), the guarantors of the student loan (parents, etc), and the law of the state where you live.  This article cannot walk you through each variation of different student loans, but the goal is to provide you with an outline and some ideas to consider in planning your estate (what you leave when you pass).
Federal student loans:
Upon your death the federal student debts in your name are discharged. To receive this discharge, your survivors need to present a certified death certificate to the loan servicer.
Parent PLUS loans:
Parent PLUS borrowers are also eligible for a death discharge since PLUS loans are federal loans.  According to Jay Fleischman, a student loan lawyer, “These loans can be discharged when either the parent or the student dies,” he explained. “Discharged federal student loan obligations won’t pass to your estate, and your heirs won’t have to pay them off.”  But, the remaining debt canceled is treated as taxable income “forgiveness of debt”.
Private student loans:
Private student loans, including refinanced loans, are more like traditional personal loans, where the lenders might come for your estate when you die. That means your creditors can file a claim against assets you owe upon your death.
Cosigning a student loan:
A co-signer is legally responsible for your debt after you pass away, regardless of the type of loan in question. Consider looking into a cosigner release.
Marriage and student loans:
If you acquired student loan debt during marriage and live in one of the nine community property states — Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin — your spouse could be liable for your student loans after you die.
If you do not live in a community property state your spouse probably not liable unless they cosigned the loans.
RESOURCES:

This article originally appeared on StudentLoanHero.com and was written by Melanie Lockert.

Share this entry

About the Author:
Diane L. DrainDiane L. Drain is a well known and respected Arizona bankruptcy attorney. She is an expert in both consumer bankruptcy and Arizona foreclosure. Since 1985 she has been a dedicated advocate for her clients and spokesperson for Arizona citizens. Diane is a retired professor of law teaching bankruptcy for more than 20 years. As a teacher she believes in offering everyone, not just her clients, advice about the Arizona bankruptcy laws. She is also a mentor to hundreds of Arizona attorneys.
I would be flattered if you connected with me on GOOGLE+
*Important Note from Diane: Nothing on this website should be construed as establishing a lawyer-client relationship between you, me, the author of any page or the website owner (me) who happens to be a lawyer.  Everything on this web site is available for educational purposes only, is not intended to provide legal advice nor create an attorney client relationship between you, me, or the author of any article.  You may pick up some information about bankruptcy, foreclosure or the practice of law written by myself or others.  Any information in this web site should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state.*

The post Do Student Loan Debts Die With You? appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.


Pages