Blogs

Nebraska is the 16th biggest state in the USA, but we rank 43rd in population density.  In fact, Nebraska has more cows than people by a ratio of 3 to 1.
Bankruptcy is a specialized area of laws these days, especially after enactment of the Bankruptcy Reform Act of 2005.  Attorneys in sparsely populated areas of the state generally do not handle bankruptcy cases, so our firm is routinely hired by clients throughout our big state.  (This is actually a wonderful aspect of practicing bankruptcy law since we get to know folks in every square inch of the state and learn about their communities.)
One challenge we face in a state that stretches 430 miles across is getting documents signed and returned in a timely fashion.  This is especially critical in bankruptcy cases since we must provide the court with a precise “snapshot” of a debtor’s financial situation on the day the case is filed.  Bank account balances change daily, average income calculations change monthly, and the list of debts owed changes constantly.

Like an astronomer looking at a distant galaxy through a telescope, we report of a scene that no longer exists.

Preparing bankruptcy petitions is like laying a foundation on moving soil or taking a vivid 35 mm snapshot of a speeding race car when the nearest camera is 3 days away.  It is hard to provide an accurate snapshot when the information is constantly in motion.  Like an astronomer looking at a distant galaxy through a telescope, we report of a scene that no longer exists.
The challenge is to get a list of debts, income and property signed and filed with the court before the information becomes outdated.  Bank account balances can vary by thousands of dollars in a matter of days and debtors may be penalized for providing the court with inaccurate information.  Receiving documents mailed to clients for signature may take up to two weeks.
Many clients do not have ready access to fax machines as that technology seems to be fading away.  To compound the problem, debtors demand their cases to be filed immediately to stop ongoing garnishments and foreclosure.  “Move fast!”, says the client.  “Be accurate!”, says the court.  It’s a tricky balance.
Once solution to this time/distance problem is to obtain electronic signatures.  Companies that offer digital signature services, such as DocuSign, allow attorneys to obtain virtually instantaneous signatures of any document.
Digital signatures are electronic signatures that are encrypted by computer technology, and encryption process protects the document from alteration.  A document that is signed digitally provides an assurance that it was signed by the sender and receiver without alteration.  Parties to a digitally signed document typically receive an executed copy of the document instantly.  A digital signature is similar to a notarized document or a document embossed with a seal to ensure authenticity.
Digital signatures have been authorized in the United States by the Electronic Signature in Global and International Commerce Act of 2000, (ESGICA). 11 U.S.C. 7001.  The Nebraska Digital Signatures Act was enacted in 1998.  In short, these laws give digital signatures the same legal effect as a penned ink signature on paper (sometimes called “wet” signatures).
MAY A DEBTOR DIGIGALLY SIGN A BANKRUPTCY PLEADING?
Federal Rule of Bankruptcy Procedure 9011 governs signatures on bankruptcy documents.  The Nebraska bankruptcy court has a local rule 9011-1 regarding signatures as well:

1. Petitions, lists, schedules and statements, amendments, pleadings, affidavits, and other documents which must contain original signatures or which require verification under Fed. R. Bankr. P. 1008 or an unsworn declaration as provided in 28 U.S.C. § 1746, shall be filed electronically and may include, in lieu of the actual signature, the signature form described in subsection C.
2. The attorney of record or the party originating the document shall maintain the original signed document for all bankruptcy cases at least one year after the case is closed. In adversary proceedings, the parties shall maintain the original document until after the case ends and all time periods for appeals have expired. Upon request, the original document must be provided to other parties or the Court for review (Fed. R. Bankr. P. 9011 applies).

May a digital signature qualify as an “original signature” under Nebraska Local Rule 9011-1?  May a bankruptcy petition be digitally signed in Nebraska?
Some bankruptcy courts appear to require “wet-ink” signatures on bankruptcy pleadings, including the Southern District of Indiana, the Northern District of Oklahoma, and the District of Maine.  However, even in in these districts it is not perfectly clear that the courts require “wet-ink” signatures on paper or if the courts are merely speaking to the requirement that bankruptcy attorneys retain originally signed documents, whether in ink or digital format, for a period of years.  Courts seem to use the term “wet” signatures to mean “original signatures” while overlooking the fact that digital signatures may also be used original signatures as well, thus causing confusion.
The Nebraska local rule 9011-1 does not use the term “wet” or “wet-ink” in reference to signatures, nor does Federal Rule 9011.  So, in the absence of local rule explicitly requiring wet ink signatures on paper, it would appear that digital signatures do qualify as original signatures in Nebraska bankruptcy cases since both federal and state law validate digital signatures.  However, a prudent attorney will seek out clarification on this topic from the court before utilizing digital signatures in bankruptcy pleadings.
Image Credit
BANKRUPCY COURTS SHOULD ALLOW AND PREFER DIGITAL SIGNATURES TO WET INK SIGNATURES ON PAPER
There are several reasons why bankruptcy courts should encourage the use of digital signatures:

• Documents signed digitally cannot be altered.  Each page of the digital document is encrypted and stamped electronically.  If altered, such a document will display an error code to warn that unauthorized changes were made to the document.
• Every page of the document is verified.  Unlike wet ink signatures on paper, it is not possible to attach altered pages to the signature page.  A wet ink signature on paper may be attached to 60 or more pages of bankruptcy pleadings, and there is no guarantee that the attached paperwork has not been changed.
• Digitally signed documents are instantly sent to all parties who signed.  If the document is altered each party has evidence of the alteration.
• Allowing digital signatures encourages attorneys to improve the accuracy of bankruptcy documents since signatures may be obtained instantaneously if errors are discovered.
• Debtors get immediate full copies of what they signed.  This makes it difficult for them to claim ignorance of what they signed.

In short, allowing digital signatures improves the integrity of court documents. It supplies debtors with full copies of what they signed immediately.  It encourages attorneys to make last minute corrections and improvements to the documents.  Digital signatures essentially provide something similar to a document where every page has been signed and notarized.
Selfishly I confess that digital signatures would be more convenient to use in our practice, but it is clear that they offer a superior level of transparency as well.  The notion that wet ink signatures are more trustworthy is simply not supported by the facts.  Hopefully Nebraska can adopt a local rule confirming the propriety of using digital signatures on bankruptcy pleadings.
Image courtesy of Flickr and Leszek Leszczynski

N.J. forces mom to pay son’s student loans: Murder ‘does not meet threshold for loan forgiveness’ for guaranteed student loans.

Marcia DeOliveira-Longinetti’s son was murdered last year.  After working through the aftermath of this horrific event – arranging a funeral, dealing with the police and closing out her son’s life she turned to the co-signed student loans.  The federal student loans were written off.  But not the New Jersey student loans Marcia co-signed, thus making them guaranteed student loans.
“Please accept our condolences on your loss,” a letter from that agency, the Higher Education Student Assistance Authority, said. “After careful consideration of the information you provided, the authority has determined that your request does not meet the threshold for loan forgiveness. Monthly bill statements will continue to be sent to you.”
Her experience with New Jersey, which runs by far the largest state-based student loan program in the country, is hardly an isolated one.  New Jersey currently has $1.9 billion in student loans.  What differentiates them is their extraordinarily stringent rules: repayments cannot be adjusted based on income, and borrowers who are unemployed or facing other financial hardships are given few breaks.
Read the full article

 
Additional articles and links:
Need help paying your federal student loans?
Disability Discharge for Federal Student Loans
Student Loans, the Latest Nightmare and How CFPB is Helping
Sometimes Paying Zero is Still Too Expensive for Students

You have heard me say this before – student loans are the next financial balloon waiting to pop.  the student loan debt now exceeds 1.4 trillion dollars.  There is little done to hold the schools responsible to handing out loans to anyone who asks.  Why would the school stop?  This is guaranteed cash flow.  The school is not held accountable to educate the students BEFORE handing out thousands of dollars.

Students also share the blame.  Some students see this as “free money”.  They have not been educated, either at home or school, how to set and stay within a budget.  As with many of us, myself included, students use the student loans to buy luxury items or to live in a more expensive dwelling.  Doesn’t everyone need a gold watch?
Lastly, the government and private lending institutions should shoulder a large portion of the blame.  No one is watching these folks, except the Consumer Financial Protection Bureau.
Now I realize this is a generalization and does not reflect all schools, all students or all lenders.  My point is that all of us need to be responsible for our actions, government included.
The post Guaranteed Student Loans Result in Nightmare for Parents appeared first on Diane L. Drain - Phoenix Bankruptcy & Foreclosure Attorney.

The federal Fair Credit Reporting Act (FCRA) provides a consumer with certain rights regarding his file in the credit bureau. The FCRA was enacted to promote the accuracy, fairness, and privacy of information in the files of a credit bureau.

Credit bureaus may generally report accurate negative information on your credit report for up to seven years and bankruptcy information for up to ten years. Under the law, credit bureaus are also called "credit reporting agencies.". You may obtain a free copy of your credit report once every 12 months from each of the three major credit bureaus at www.annualcreditreport.com.

A consumer has the right to dispute inaccurate or outdated information on his credit report under the FCRA. The credit bureau and the provider of the information (such as the credit card company or other lender) have the duty to correct inaccurate or outdated information. You may dispute the information on the credit report with both the credit bureau and the provider of the information. The credit bureau must generally investigate the disputed item within 30 days. When the investigation is complete, the credit bureau must give a person the written results.Jordan E. Bublick - Miami Bankruptcy Lawyer - North Miami & Kendall Offices - (305) 891-4055 - www.bublicklaw.com

Debt Collector Chad Steur Law Refuses to Pay Up Chad Steur Law, LLC, a debt collector, owes my client, Helen, $2280.58. So far, Steur refuses to pay up.  Before she came to see me, Helen was being harassed by a debt collector, calling for Chad Steur Law.  The collector told her he was calling from […]The post Debt Collector Chad Steur Law Refuses to Pay Up by Robert Weed appeared first on Robert Weed.