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4 years 4 months ago

13Debtors who are struggling to make payments may find Chapter 13 bankruptcy helpful for a number of reasons.  For some, it helps them make their money stretch further while still being in good standing with their creditors. For others it helps them keep their property due to falling behind on payments.  You get legal protection [...]


4 years 4 months ago

By C. J. HUGHES To understand how the current office market for technology companies can resemble a Russian nesting doll, with layer upon layer of increasingly smaller subleases, it might help to consider the upper stories of 568 Broadway in SoHo.
In the cast-iron former sewing factory, Scholastic, the publisher, is subletting two floors of space to Foursquare, a social media company. In turn, Foursquare is subletting one of those floors to a handful of other tech firms, including Fueled, which designs apps for phones.
And Fueled has divided its column-lined room as a co-working space, where $650 a month gets a renter a seat and unlimited snacks from jars along a wall.
One of those seats belongs to David Spiro, a self-employed entrepreneur, who sat alone at the corner of a long table on a recent afternoon, a bag of popcorn by his laptop. “I’ve raised some funding,” Mr. Spiro said, “but not nearly enough to afford a typical lease in Manhattan, so this place is great.” The sentiment could also apply to the daisy chain of tenants in his building, and more broadly to the surrounding neighborhoods.
In the last few months, the area of Manhattan south of Midtown has been awash in deals where early-stage tech companies have opted to take over office space belonging to another tenant, rather than enter into a direct lease with a landlord.
These sublet deals are often preferred, tenants and brokers say, because the rents are usually slightly cheaper than conventional leases. They can also be for shorter lengths of time than the typical 10 years and require a far smaller security deposit up front.
As important, they say, is that the spaces usually come built out, which means essentials like high-speed Internet lines, air-conditioning and conference rooms are already in place. Getting up and running quickly is critical for companies or self-starters that often measure growth in months, not years, analysts explain.
Of course, the office within an office within an office can carry risks. If the first, second or third tenant goes bankrupt, a subletter could find itself without a home. But because their own leases are so brief, these low-rung tenants can also easily wind down operations quickly if, say, their app never catches fire.
“They don’t know about the future, so flexibility is key,” said Heidi Learner, the chief economist at Studley, the commercial real estate firm, who is the co-author of a report on the tech sublet trend. “You don’t know about what head count will be, whether you will get any venture capital funding, or whether you will be acquired.”
In general, subletting is becoming more popular. In the Midtown South area, or from Canal Street to 30th Street, sublets accounted for 19 percent of major leasing activity this year, up from 11 percent in 2010, Studley said.
And between January and April of this year, 33 percent of all the leases signed in Manhattan by tech companies — a major driver of the current economy — were sublets, the report said. Sublet tenants among other industries within the same period were less than half that.
The report also states that the average length of tech subleases is about four years.
Not just any space will do; tech firms almost exclusively want prewar buildings with lofty ceilings and open floors, said Sean Black, a broker with Jones Lang LaSalle. Since that type of converted industrial space is clustered mainly around the Broadway corridor, supply is limited, he added, and demand is robust.
“They like the ‘old world meets new world’ look,” said Mr. Black, whose many tech clients include Foursquare. A lack of walls and cubicles, with eclectic art on the walls, embodies a certain attitude. “The last thing they want to do is conform with corporate America.”
Technology firms have been subletting a bit more space than they personally need, reflecting awareness of heightened demand from a flourishing industry that allows them to rent out extra room to similar companies. Besides, locking in the space at today’s asking rents, which for sublets is about $45 a square foot in Midtown South, according to Studley, is considered wise, because rents are expected to climb, companies say.
“It’s a great way to hedge the lease,” said Derek Stewart, who handled leasing for Foursquare before leaving the company this summer.
Foursquare, which has 120 employees in New York, paid about $45 a square foot in 2011 in a seven-year deal, Mr. Stewart said. But he estimated that with companies like ZocDoc, a physician app service, and Thrillist, a lifestyle site for men, under the same roof, the building had gained a bit of buzz as a popular tech address. That means the space could command $55 a foot today, he said. But so far there has been little urge to profit off the subtenants, he added, saying that Fueled and the other subtenants also pay about $45 a foot for their space. “We felt kind of badly making money off it,” Mr. Stewart said. “We didn’t want to have a bad name in this tight community.”
Mr. Stewart, who now works for David Tisch, a tech investor, also pointed out that subleases were essential for the survival of the tech community.
In San Francisco, where Mr. Stewart leased two spaces on behalf of tech companies, start-ups can afford direct leases, which often require just three months of rent for a security deposit. But in New York, 12 months of rent is common. “Landlords here are just so risk-averse,” he said.
In a business where a company’s start-up phase can be hypercompressed — Instagram was founded in 2010 and bought by Facebook for $1 billion two year later — short sublets are not unusual.
The news site BuzzFeed, for example, has signed a two-year sublease for space in the new headquarters of Tiffany & Company at 200 Fifth Avenue, across from Madison Square Park. BuzzFeed, which had been based on West 21st Street in a 20,000-square-foot space, will take an entire 58,000-square-foot floor, which is one of seven floors Tiffany has there.
The rent was not disclosed, but Greg B. Taubin, the Studley broker who represented Tiffany, said that comparable sublet space in the area went for $65 a square foot.
 “Companies like this don’t sign long-term leases because they don’t have a crystal ball,” Mr. Taubin said. But for Tiffany, which doesn’t need the space immediately, there’s an upside in cost reduction, too, he added.
Other advantages include having lights on and more people in the elevators, said Bonnie Shapiro, the director of leasing for Allied Partners, an owner of 568 Broadway. “You don’t want tenants touring the building and seeing dark, unused spaces,” she said.
For tenants that may be consolidating or downsizing, the new demand for sublet space may come at a fortunate time. Credit Suisse, the investment bank, which has undergone several rounds of layoffs in recent months, has managed to sublet all its former office space at 315 Park Avenue South, one of three locations it has in Manhattan.
Tech subletters in the 20-story Beaux-Arts tower, which is at East 23rd Street, include VaynerMedia, X+1 and Responsys, as well as Adap. TV, which this month took the entire seventh floor measuring 16,000 square feet. The new space features a red wall decorated with words like energy, creativity and passion, and executive offices around the perimeter have been turned into shared conference rooms. The space is a far cry from its cramped, plain-jane 4,000-square-foot space at 915 Broadway, said Gerry Manolatos, the communications director for Adap. TV.
Mr. Manolatos would not disclose the terms of his lease, only that it is for less than a decade. But in the merry-go-round of the tech sublet market, Adap. TV is cashing in itself; its former space on Broadway is also being sublet to a tech firm, he said.
“It’s like one deal leads to the next,” Mr. Manolatos said. “Everybody’s thinking, ‘Who knows where we will end up next?’ ”
Copyright 2013 The New York Times Company.  All rights reserved.


4 years 4 months ago

Recently I attended a great Central District Consumer Bankruptcy Attorney Association event regarding the Homestead Exemption and Chapter 7 Bankruptcies.
So first of all, there’s a difference in California as it relates to Automatic Homesteads (CCP 704.710) and Declared Homesteads (CCP 704.910).  Courts under California’s jurisdiction have held that the homestead was created to allow debtors to live in a principal residence and/or substitute one family residence for another.  The homestead was not created to shelter equity from creditors.  Thus there is a requirement under current law that the Debtor reinvest the proceeds in a new homestead within six months of receipt under the current case law applicable to California.
So what in the world does this all mean for someone who owns a home and is currently contemplating filing a chapter 7 bankruptcy in California?  The answer:  beware of the chapter 7 trustee and what he or she may do with respect to the residential real estate.
Furthermore, the concept of the Homestead Exemption used to be something a Debtor could rely upon.  Now, there are cases holding that a chapter 7 trustee can surcharge the Homestead Exemption!  That means in certain cases, a debtor could find the Homestead surcharged by the trustee for bad faith conduct or depletion of non-exempt assets or Property of the Estate.  At issue in these surcharge cases is whether a bankruptcy court even has the inherent authority to do so under Section 105(a) of the Bankruptcy Code.
As one can see, the Homestead Exemption as it relates to California and the 9th Circuit as it applies to bankruptcy law is an evolving matter.   A debtor will need to rely upon a well informed attorney to assist with these potential complex and tricky matters.
 
 
 
 


4 years 4 months ago

When you owe money to any creditor, the creditor has a right to go to court and obtain a judgment. Once they do, you may be dealing with a writ of garnishment for your wages, personal property or your bank account. In New York, the maximum amount that may be garnished from your wages is 10% of your income. However, this may not stop a creditor from seizing your bank account.
How creditors obtain a writ
Before a writ can be obtained, creditors must go to court and sue the debtor. If a judgment is awarded by the court, the creditor has the opportunity to hold that judgment for up to 20 years. However, the creditor must file a suit to obtain a judgment within six years of the time the creditor has stopped making payments on their debt per New York’s Statute of Limitations.
Limitations when a writ is obtained
There are numerous federal rules that apply to a creditors ability to garnish wages including income limitations and the type of income. These federal rules may be strengthened at a state level but they may not be weakened. New York provides specific guidelines on income and types of income that may be garnished under a writ.

  • Pensions - New York does not allow creditors to remove funds from a pension plan to satisfy a judgment. However, there may be instances when you are withdrawing these funds they may be garnished
  • Insurance and annuity - Income from insurance or annuities may not be subjected to any type of garnishment in the State of New York
  • Social security - Federal law prohibits any type of garnishing of these federal benefits

Income limits for garnishment
While federal statutes provide a maximum garnishment amount, the limits in New York are even more stringent. Creditors may only garnish 10 percent of wages or 25 percent of disposable income. These limitations are not applicable to child support payments, alimony payments and in some cases, to tax payments.
Bank accounts and writ of garnishment
When a bank receives a notification that a creditor has received a writ of garnishment, they must freeze the assets in your bank account. There is a high probability that the funds in your bank account will also be seized. To lift this type of garnishment, you will have to go to court and request the writ be lifted. Banks must obey a writ since they are court ordered garnishments and they can face severe penalties for not complying with the order.
There are many rules in place that creditors must follow before they obtain a judgment and writ of garnishment. While these court orders can seize portions of your income and balances in your bank account, you must be notified the judgment was awarded. If you are uncertain that the rules were followed by a creditor with a writ of garnishment, it is imperative you contact an attorney for assistance.


3 years 10 months ago

Judge RhodesJudge Steven Rhodes
Judge Steven Rhodes held the first hearing today in Detroit’s historic bankruptcy filing.  During the hearing the judge entertained two motions filed by the Emergency Financial Manager of the City of Detroit.  The first motion was a motion for a “comfort order” to verify that the bankruptcy stay protecting the City of Detroit is in place and that the City of Detroit is protected from further lawsuits.  The second order was a motion to “extend the stay” or more accurately to expand the stay to cover the Governor, the Treasurer and other state officials from any lawsuits related to the filing of the Chapter 9 Bankruptcy.  The judge took arguments from the City of Detroit as well as each of the objecting creditors.  The judge also allowed comments from a few parties that had not objected.  After a rebuttal argument from the city of Detroit the judge adjourned to allow himself time to deliberate.
Emergency Financial Manager Kevin OrrKevin Orr
Judge Rhodes returned to the bench at 2:00pm to issue his ruling.  In regards to the first motion, Judge Rhodes ruled that the stay was in effect.  This portion of the ruling was a forgone conclusion as the provisions of the bankruptcy code are clear.  As part of his determination that the bankruptcy stay was in effect, the judge ruled that Detroit’s Emergency Financial Manager Kevin Orr, an official created under state law rather than city charter and appointed by the governor as opposed to elected by the residence of the city, is a city official under the bankruptcy code and therefore protected by the bankruptcy stay.
 
Governor SnyderGovernor Rick Snyder
The judge also granted the motion to expand the stay to cover the Governor and the Treasurer.  In his ruling the judge stated that the cases against the Governor and the Treasurer were so inextricably interwoven that the city could not receive relief unless the stay extended to the Governor and the Treasurer.  In his ruling the judge asserted that the bankruptcy code provides the bankruptcy court with exclusive jurisdiction to determine eligibility to be a bankruptcy debtor under Chapter 9.  In ruling that the court has exclusive jurisdiction, the court in essence ruled that the state court has no jurisdiction to review the actions of the state’s sitting governor in order to determine if those actions complied with the state constitution.  Instead the federal bankruptcy court will be the venue in which the governor’s actions will be reviewed.  In his ruling the judge acknowledged that if the case in state court were allowed to go forward, the state court may reach a different conclusion than the federal bankruptcy court thus creating confusion.
10thWhat the ruling failed to recognize is that while the state court case would have an affect on the outcome of the federal court decision, the two cases and legal determinations are not in fact the same.  The state court case was intended to review the actions of the Governor.  The federal court case is meant to review the eligibility of the City of Detroit to be a Debtor under Chapter 9.  Certainly the state court is a better forum to review the constitutionality of the actions of the governor under the state constitution.  The State of Michigan was deprived today of a right to review the actions of its own governor in light of its own Constitution.  That is a blow to states’ rights and to the basic concept of federalism.  It is very likely that the case will be appealed.
Second Chance Legal Services is a bankruptcy law firm located in Madison Heights, MI.  While we are located in Oakland County, we service Wayne, Oakland and Macomb County residents.  As Detroit Bankruptcy Attorneys we specialize in helping individuals escape their burden of debt in order to get a fresh start on their bright future.
Because of our small size our clients get individual attention.  You will have the same bankruptcy attorney throughout your case whether you are in a Chapter 7 Bankruptcy or a Chapter 13 Bankruptcy.  Your attorney will help guide you through the bankruptcy process in order to help you get a successful discharge of your debt.
It is important to note that Macomb County Bankruptcy Attorneys, Oakland County Bankruptcy Attorneys and Wayne County Bankruptcy Attorneys all deal with the same judges and trustees.  This is because all Michigan Bankruptcies are filed with the federal bankruptcy court in Detroit, MI.  For this reason, it is important that you choose an attorney not by location but rather by how comfortable you feel with them when you meet.  If you don’t feel comfortable with their knowledge, their experience or their demeanor you should seek out an attorney that you do feel comfortable with.
If you are interested in speaking with a Detroit bankruptcy attorney from Second Chance Legal Services, please contact our office at 248-629-6367 for a free initial consultation.


4 years 4 months ago

When an Emergency Bankruptcy is FiledA new study confirms what many American households continue to struggle with debt from medical bills.  When it comes to filing for bankruptcy such bills continue to be one of the main reasons why people seek legal protection.  Besides rising medical costs, other reasons bankruptcy is commonly filed include unpaid mortgages and credit card debt. [...]


4 years 4 months ago

The Bankruptcy Court of the Western District of Michigan recently held that a spendthrift provision in a trust was negated by other trust provisions, and resulted in a debtor’s beneficial interest in the trust becoming property of the estate.1
The issue before the Court was whether the trust restrictions prevented the debtor’s beneficial interest from being included in property of the estate.2 In this case, the debtor’s mother created a trust in 2001, and the debtor was one of four named beneficiaries of the trust. Upon the settlor’s death in August, 2011, the trust became irrevocable. The trust included a spendthrift provision that prevented any beneficiary from assigning his interest in trust income or principal. The trust also included a provision authorizing the trustees, in their discretion, to distribute trust principal to a beneficiary in the event the beneficiary could not support himself. The trust further contained an “age-based restriction” on a beneficiary’s withdrawal rights (including the debtor’s rights). The “age-based restriction” specifically provided that after a beneficiary reaches age 25, the beneficiary has a “continuing right to withdraw any amount up to one half of the value of the trust assets; and after the beneficiary attains age 30, the beneficiary has a continuing right to withdraw all trust assets.” When the settlor of the trust died, the debtor was 42-years-old.  Read More ›
Tags: Western District of Michigan


4 years 4 months ago

U.S. Coast Guard boats leave Burnham harbor on Lake Michigan, near McCormick Place, in ChicagoBringing you the most up-to-date news, tips and blogs throughout the web. Here’s your Bankruptcy Update for July 23, 2013 Detroit bankruptcy raises concerns about other US cites under huge retiree debt Detroit Retirees Wonder How Bankruptcy Will Affect Benefits Mi Pueblo files for Chapter 11 bankruptcy  


4 years 4 months ago

couple-going-over-finances-horizMarried couples may benefit from filing a joint bankruptcy petition under certain circumstances.  Couples may save money during the process and gain adequate protection for assets and property between them.  Yet, there are a few details to review in understanding the process and whether a joint petition is the best option. The process is similar [...]


4 years 4 months ago

high cost anxietyA reasonable question posed about the student loan debate is whether the anxiety about costs is really anxiety about jobs after graduation? That’s one of the issues spotted in a recent blog post by an unnamed Community College Dean, and it bears consideration.
When the economy was growing, the cost of education was no big deal. We knew that if we plunked down $10,000 for tuition, we’d come out the other side with a job that could pay the student loans handily.
Even when the economy went through a downturn (part of the natural cycle of capitalism), those who considered the matter would reasonably bet that things would brighten up in time for the student loans to come due.
As S. E. Hinton said, that was then – this is now. Time to adapt.
Here’s How It Went
Back in the old days we went through a boom-and-bust cycle. We’d do really well as a country, stumble and fall, then brush ourselves off and resume the race.
Unemployment would go up, then down. Industry would chug along, churning out goods for the American population to consume. It was the engine of capitalism, and that’s how it worked.
Over time, we stopped making things. We shipped our manufacturing overseas where it could be done cheaper.
Still, we employed people to sell that which we imported. Jobs began to center around providing services rather than goods. Brute force was replaced by the power of human intelligence.
With that came the rise of higher education. We needed to educate the people who would provide services in a way that was unlike the education provided to those who built things on factory lines.
A philosophy major could graduate and find a job. Likely not in the field of philosophy, but a job nonetheless. So, too, a political science or literature major.
The first wave of those with a college education had little competition from the older generation, those who had largely bypassed college due to lack of need.
The World Changed
Ever since the late 1990s, we’ve seen a creep of technology into our lives that renders us far more efficient than ever before.
Fewer bodies are needed to do the work required before the rise of the machines.
Those with jobs – the parents of recent graduates – are living longer, healthier lives and don’t slink into retirement as soon as did the generations before them. No longer are they felled by black lung disease and physical disabilities due to accidents on the line. Retirement comes later because the promise of Social Security has failed them.
Take both of these factors – greater efficiencies and fewer openings – and you’ve got the perfect storm for graduates.
Higher Education Needs To Adapt
Higher education needs to realize that students aren’t getting the skills they need to compete in the current economy. They aren’t being taught creativity, business-building, and how to build an expertise that will be independent of the work provided by an employer.
Colleges at the four-year and community college level need to bring the real world into their classrooms, to invest in their teaching staff in a way that enables them to teach practical skills that will help graduates earn a living.
It’s also time to trim the fat from the higher education system. Streamline the system, bringing learning online whenever possible to lower overhead.
Pay attention to technology in a way that makes it less expensive to gain an education. Pass along those savings to the students, lowering the need for student loans.
If higher education doesn’t change, the risk to our society in the long run is frightening.
Image credit:  401(K) 2013
The Anxiety About The Costs Of Higher Education was originally published on Consumer Help Central. If you're seeing this message on another site, it has been stolen and is being used without permission. That's illegal, a violation of copyright, and just plain awful.


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