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Businesses have been hit hard on account of the COVID-19 pandemic. While many people have had protection & help through stimulus checks, eviction moratoriums, and extended employment benefits, businesses- both large and small- have not had as much help.
Many businesses and corporations have filed for Chapter 11 bankruptcy amid the COVID-19 pandemic. Although worrisome, Chapter 11 bankruptcy does not mean a company completely stops operating, it just means they are struggling.
Click the link below to see the 20 biggest companies that have filed for bankruptcy due to the COVID-19 pandemic.
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The post The 20 Biggest Companies That Filed for Bankruptcy Amid The COVID-19 Pandemic appeared first on Allmand Law Firm, PLLC.
If you experience financial problems that make you unable to pay the money that you owed to a creditor, declaring bankruptcy may be your last option to seek debt relief. Bankruptcy will allow you to reorganize your finances, pursue debt settlement, and pay off a creditor. Different types of bankruptcy will help you manage your finances and pay your debts.
There are two different types of debt: secured debts and unsecured debts. Secured debt is a type of debt backed by collateral to reduce the risk associated with lending. It is often associated with borrowers that have poor creditworthiness. If you have a good credit history, you will have higher chances of loan approval. Because the risk of lending to an individual or company with a low credit rating is high, securing the loan with collateral significantly reduces that risk.
If the borrower on secured loan defaults on repayment, the bank will seize the collateral, liquidate and sell it, and use the proceeds to pay back the borrowed money. Assets backing debt or a debt instrument are considered as a form of security, which is why unsecured debt is considered a riskier investment than secured debt.
Secured credit is created with liens. It provides a lender with added security when lending out money. A lien is classified as a voluntary lien or involuntary lien. An experienced Oregon bankruptcy attorney can help you understand how the liens affect your bankruptcy filing.
A voluntary lien is a type of lien where the owner of a property consensually grants another party legal claim to the property as security for the repayment of a debt. The debtor voluntarily grants the lien to the lender, and the property is used as collateral. For example, when you apply for a housing loan, you will be required to sign a deed of trust or a mortgage. This agreement serves as proof that you grant the lender a lien or security interest for your property. If you fall behind on your monthly payment, then the lien will be used to allow a foreclosure auction.
A lien can be granted to a lender against your personal property through a security agreement. This includes equipment, vehicles, furniture, inventory, tools, stock shares, cash, other investments, or anything that you possess that is not a real estate property. Types of loans such as car loans and home mortgages are secured debts with a voluntary lien. When you apply for a car loan, you will be required to sign and authorize a security agreement that grants a lien against the car that you will buy. If you fail to repay according to the payment plan, the lender can repossess the car using the voluntary lien.
On the other hand, an involuntary lien may be imposed by the court, often for non-payment of taxes. The involuntary lien gives the tax authority (or other body) the right to confiscate one’s property if the debt is unpaid. It includes mechanic’s liens, income tax or real estate liens, judgment liens, and landlord liens.
Secured creditors can protect their collection rights by perfecting a lien. In legal terms, “perfection” refers to a mandatory action to give a creditor notice of lien depending on the applicable state law and property type. A perfected lien provides legal documentation to prove that a creditor has a legal right to seize a collateralized property in place of payments for which they are owed.
In most states, a lender can perfect a lien for a real estate property by filing or recording deeds of trusts and mortgages in the same location of that property. For vehicles, lenders may perfect the liens against motorcycles, trucks, and cars by filing a notation on the certificate of title with the state motor vehicle department.
To perfect a lien for tangible personal properties such as furniture, equipment, tools, materials, and goods, a financing statement must be filed. It is a legal document or record that recognizes the lender, the borrower, and the collateral for secured debts. A financing statement can be filed by a creditor even without a signature, as long as the debtor has signed the agreement for the collateral.
A lender needs to perfect a lien. Some borrowers are granting liens to multiple creditors against the same property. For instance, home equity lines of credit are typically considered as junior to the home loan that you have taken. If the owner of the mortgage is unable to perfect the secured interest, the junior lien can move up in priority.
Lenders might face serious consequences if they fail to perfect a lien. If you decide to file for bankruptcy, the court can disregard a lien that was not perfected properly. In this case, the lender will be considered as an unsecured creditor.
Secured and unsecured debts differ from one another in terms of how a creditor can impose his or her rights to collect, in case you are unable to make monthly payments on time. A credible Oregon bankruptcy attorney can help you classify your assets as secured or unsecured. When you deal with unsecured debts, a creditor is required to file a lawsuit in bankruptcy court before they seize your assets or property.
In contrast, a secured creditor can immediately enforce rights when you fall behind your loan debt and have not yet declared bankruptcy. A court order is not required before the repossession of any car or motor vehicle; however, secured creditors are not allowed to breach the peace or to trespass on any private property.
A lender can impose a home mortgage by foreclosing the deed of trust. Some states allow foreclosure even without any legal action from the bankruptcy court and it can be accomplished within a couple of months. In some states, foreclosure may require approval from the bankruptcy court, therefore the process may take longer.
Before you declare bankruptcy, it is important to know and understand how the bankruptcy process and bankruptcy exemptions will solve your debt problems. Credit counseling can give you an in-depth understanding of the importance of debt management. For legal help in filing for bankruptcy, do not hesitate to consult our qualified Oregon bankruptcy lawyers at Northwest Debt Relief Law Firm. Our lawyers will guide you on how to file your bankruptcy forms, prepare your paperwork for the bankruptcy filing, negotiate settlements to reorganize a repayment plan, help you get out of debt, and improve your credit score according to the bankruptcy laws.
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The post Importance of Secured Debts in Oregon appeared first on Portland Bankruptcy Attorney | Northwest Debt Relief Law Firm.
For most people, bankruptcy works. For most people “debt settlement” doesn’t work. One reason. The debt settlement people charge enormous fees–FDR and NDR charge at least $6,000 to “settle” $40,000 in credit cards (and you still have to pay the settlement). Plus, they usually don’t work . See this email I got this email today […]
The post For most people bankruptcy works. For most people, debt settlement doesn’t. by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.
For most people, bankruptcy works. For most people “debt settlement” doesn’t work. One reason. The debt settlement people charge enormous fees–FDR and NDR charge at least $6,000 to “settle” $40,000 in credit cards (and you still have to pay the settlement). Plus, they usually don’t work . See this email I got this email today […]
The post For most people bankruptcy works. For most people, debt settlement doesn’t. by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.
For most people, bankruptcy works. For most people “debt settlement” doesn’t work. One reason. The debt settlement people charge enormous fees–FDR and NDR charge at least $6,000 to “settle” $40,000 in credit cards (and you still have to pay the settlement). Plus, they usually don’t work . See this email I got this email today […]
The post For most people bankruptcy works. For most people, debt settlement doesn’t. by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed.
People who file for bankruptcy in California often have questions regarding the process and its impact on their lives after filing. Having a bankruptcy on your credit report could affect your ability to rent an apartment, obtain a loan, or qualify for a mortgage. Some potential debtors are concerned about how filing for bankruptcy will […]
The post Can You Lose Student Loan Eligibility if Your File For Bankruptcy in California? appeared first on The Bankruptcy Group, P.C..
Everyone experiences some sort of financial struggle. Good news: this is not the end-all-be-all! Some of the most successful people ended up filing for bankruptcy before they were rich and famous.
Some of your favorite celebrities are on this list! Click the link below to see all 9 famous people who filed for bankruptcy before they became rich!
P.S.: There is a former U.S president and a financial advisor on this list!
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The post 9 Famous People Who Went Bankrupt Before They Were Rich appeared first on Allmand Law Firm, PLLC.
Many people in California rely on their disability benefits, either Social Security Disability Insurance (SSDI) benefits or Supplementary Security Income (SSI). This monthly income is required to pay rent, food, utilities, and other necessities. While creditors in California could garnish your regular wages, they are generally prohibited from garnishing your disability benefits. However, your benefits […]
The post Can a Disability Check be Garnished in California? appeared first on The Bankruptcy Group, P.C..
CFPB Rule Clarifies Tenants Can Hold Debt Collectors Accountable for Illegal Evictions
Bureau Issues Interim Final Rule on Fair Debt Collection Practices Act (reprint April 19, 2021)
The Consumer Financial Protection Bureau (CFPB) today issued an interim final rule in support of the Centers for Disease Control and Prevention (CDC)’s eviction moratorium. The CFPB’s rule requires debt collectors to provide written notice to tenants of their rights under the eviction moratorium and prohibits debt collectors from misrepresenting tenants’ eligibility for protection from eviction under the moratorium. The CDC has established the eviction moratorium to protect the public health and reduce the spread of the virus. Debt collectors who evict tenants who may have rights under the moratorium without providing notice of the moratorium or who misrepresent tenants’ rights under the moratorium can be prosecuted by federal agencies and state attorneys general for violations of the Fair Debt Collection Practices Act (FDCPA) and are also subject to private lawsuits by tenants.
“With COVID-19 killing hundreds of Americans every day, kicking families out into the street during this pandemic may literally be a death sentence,” said CFPB Acting Director Dave Uejio. “No one should be evicted from their home without understanding their rights, and we will hold accountable those debt collectors who move forward with illegal evictions. We encourage debt collectors to work with tenants and landlords to find solutions that work for everyone.”
Nearly 9 million households are behind on their rental payments. Tens of thousands of renters are being evicted every week, often without being told of their rights under the CDC moratorium. As the CDC has found, tenants who are evicted may end up homeless or in crowded or shared living settings, increasing their vulnerability to COVID-19 and the risk of the disease spreading throughout communities. Such evictions can have long-term health, financial, and social consequences for families and children.
CDC Moratorium
A temporary eviction moratorium ordered by the CDC has been extended through June 30, 2021. The CDC order generally prohibits landlords from evicting tenants for non-payment of rent, if the tenant submits a written declaration that they are unable to afford full rental payments and would likely become homeless or have to move into a shared living setting. This prohibition applies to an agent or attorney acting as a debt collector on behalf of a landlord or owner of the residential property.
Tens of thousands of tenants and families are evicted every week, many of whom would have had a right to stay in their homes if they had given their landlord a completed CDC eviction moratorium declaration. According to a recent Government Accountability Office report, tenants facing eviction may be unaware of the moratorium or may not understand the steps they must take to act on its protections. Declarations can be submitted in languages other than English, and alternative forms are available online.
New Tenant Protections
Under the FDCPA interim final rule, debt collectors, including attorneys, seeking to evict tenants for non-payment of rent must provide tenants who may have rights under the CDC order with clear and conspicuous written notice of those rights. The notice must be provided on the same date as the eviction notice, or, if no eviction notice is required by law, on the date that the eviction action is filed.
Debt collectors must provide the notice in writing. Phone calls or electronic notice such as text messages or emails are not sufficient. The CFPB is providing debt collectors with sample language to satisfy the rule’s disclosure requirements.
Failure to provide the required notice to tenants is a violation of the FDCPA. The FDCPA provides a private right of action against debt collectors, and violators can be held liable for actual damages, statutory damages, and attorney’s fees. Class actions may be brought under the FDCPA.
Some states and localities have adopted their own eviction moratoria. Debt collectors may also be required to provide notice of these moratoria. The CFPB’s rule does not preempt more protective state law.
There are additional resources available to help struggling renters impacted by COVID-19. Congress has created the Emergency Rental Assistance Program, administered by the U.S. Department of Treasury. This program provides assistance through state and local government to help tenants catch up on missed payments to avoid eviction. Applicants must apply through their local programs.
The National Low Income Housing Coalition has a directory of state and local rental assistance programs that renters can use to find their local programs. Landlords may also be eligible for funds under the Emergency Rental Assistance Program. The pandemic’s health and economic crises threaten families and communities across the nation. According to the CFPB’s analysis and other data:
- Millions of families are at risk of being evicted: In December 2020 about 18 percent of renter households were behind on their rent, which means nearly 9 million households at risk of eviction. In a typical year, there are about 900,000 evictions nationwide. Over 27 percent of households with annual income under $25,000 were behind on their rent.
- Stopping evictions saves lives: Research shows that COVID-19 infection rates and mortality rates were higher when eviction moratoria were removed. The CFPB’s rule will help ensure that more renters are able to take advantage of their protections and avoid eviction.
- Evictions increase racial inequality: Black and Hispanic households are more than twice as likely to be tenants than white households, and they are also twice as likely to be behind on rental payments as of December 2020, according to a March CFPB report. Evictions impose substantial costs on individuals, families, and children, and having an eviction on your record can make it much harder to find a new rental property. Even an eviction filing can make it impossible for a family to locate new housing.
The CFPB has authority under the FDCPA to “prescribe rules with respect to the collection of debts by debt collectors.” Attorneys who engage in eviction proceedings on behalf of landlords or residential property owners to collect unpaid residential rent may be “debt collectors” as defined by the FDCPA. Given the urgency of the pandemic crisis, the Interim Final Rule will take effect on May 3, 2021. The CFPB believes this will give debt collectors time to come into full compliance. Debt collectors may begin complying with the rule before the compliance date.
Read the Interim Final Rule issued today.
Read a Fast Facts summary of the Interim Final Rule.
See the sample disclosure language for debt collectors.
Visit the CFPB’s housing portal to learn about renters’ rights and resources for struggling consumers.
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Be very careful when looking for “free” advice. COVID has given fraudsters even more incentive to lie, cheat and steal your hard earned money. Through the many “COVID” programs, there are hundreds of thousands of dollars available to help tenants stay in their homes. But, I am told those tenants are unaware of their rights or how to access those funds. Smart landlords are walking tenants through the process so the landlords do not face the foreclosure of their property.
Only rely on government websites. Contact the agency directly, do not respond to emails, phone calls or letters from someone saying they are with the government – THEY ARE SCAMS. Sources including: www.FHA.gov, www.CFPB.gov, www.FTC.gov, to name a few. Once armed with good information, then use your common sense to decide what is best for you.
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- Avoid COVID Mortgage Relief Scams
- Debt Collectors Profit Because of COVID and Want More Money
- COVID-19 SCAMS – WARNINGS FROM FTC
- Resources for Consumers – COVID-19
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How are foreclosures rising even though federal action has taken place? It seems these foreclosures are not happening to current live-in homeowners, rather they are foreclosing vacant and abandoned buildings, which can benefit neighborhoods and communities.
Although U.S. foreclosures have only risen 9% since last quarter, total foreclosures have risen 75% since last March 2020.
To learn more information about foreclosures during these moratoriums, click the link below.
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The post Despite Federal Moratoriums, Quarter 1 Foreclosures Increase appeared first on Allmand Law Firm, PLLC.
Updated daily, this blog will keep you informed on the latest bankruptcy news! 
Learn more about how Bankruptcy works and what you need to know.