A bankruptcy claims trading platform called Xclaim just closed a $7 million fund raising round after adding a focus toward crypto claims.
If you have funds stuck in one of several centralized crypto related companies which filed bankruptcy last year, this may be of interest to you. I have no recommendation of this firm and have never used it: x-claim.com.
“It is now time”, states Judge Klein who is charting a path for discharging student loans without being reversed. For years, bankruptcy judges were wary of ruling in favor of debtors who asked for a discharge of federal student loan debt. In part, because those Judges knew their rulings would be appealed by either the Department of Education, or ECMC (guarantor litigator for the older FFEL loans). Now it’s different.
In an opinion just out on April 5 (Love v U.S. Dep’t of Education, Fedloan Servicing, Nelnet; Adv. 21-02045-C), Judge Klein decried the “widespread belief that student loans are virtually impossible to discharge in bankruptcy.” Now there is an attestation process, whereby a debtor can use factors like:
What is the IDR Waiver?
The Short Version: if you have an older FFEL loan, even a prior FFEL Consolidation Loan, make sure to consolidate this to a newer Direct Loan asap if you want all of the relief this program allows (contact us if you have any doubts or concerns about losing prior IDR time, interest rate increases, effects on PSLF etc.) While the deadline to do so is May 1, the servicers are busy and it doesn’t pay to wait until the deadline!!
For many years, student loan servicers steered struggling borrowers into forbearance instead of guiding them toward income driven repayment. Income driven payment generally caps payments at no more than 10 percent of income, and ultimately leads to loan forgiveness after 20 or 25 years of repayment. Many of these loan servicers also failed to accurately track borrowers’ progress toward forgiveness. Some of these companies had no system for tracking payments and identifying when borrowers would qualify for forgiveness.
Did you realize that we have free videos on what to do about your student loan on our YouTube Channel “Student Loan Sidebar”? Here’s a post from a few hours ago from one of our followers:
New IDR Terms Announced! Sorry for the delay in getting this out, Covid has put me behind a week or so.
The new IDR Plan expected out in July before the payment pause ends will not exactly be a new plan. Instead of confusing borrowers and making yet another IDR plan, the Department of Education has decided to modify the terms of the existing Repaye plan to try and simply things. While some of us are a little worried that this process would enable a future administration to change the terms back, we do feel that the steps underway will be a huge improvement for federal student loan borrowers. Also, it would be difficult for a new administration to back date substantive negative changes so while we don’t expect this to occur, it’s in the back of our minds.
The changes are underway now and a formal 30 day comment period commenced a few days ago. If the terms do not meaningfully change before implementation this summer or fall, here’s what to expect:
If you have significant debt but have been told that you cannot file a Chapter 13 consumer bankruptcy, now you can file bankruptcy and not risk dismissal by the U.S. Trustees office. This change occurred because the Bankruptcy Threshold Adjustment and Technical Corrections Act was signed into law yesterday. Prior to this Act, someone with high debt was forced into a Chapter 11 — which is extraordinarily expensive and time consuming for the average consumer. A Chapter 13 is much more cost-effective and efficient to reorganize someone’s finances.
While the name of this Act is thoroughly boring, it is very practical and necessary. This Act fixes a recurring problem that has reared its head more in the past year than ever before. Student debt has reached such a high number for many borrowers, that it was actually preventing someone from filing bankruptcy to address that student debt, or even to get rid of ordinary household debt or stop a foreclosure.
Now the debt limit for an individual filing a Chapter 13 is $2.75 million and the Act also removes the distinction between secured and unsecured debt. This new law is temporary and will sunset on June 21, 2024. So basically, this means that if you wait two years to file, you will NOT receive the benefit of this debt increase and may again, be prohibited from filing bankruptcy.
A mortgage servicer called a “furnisher” for purposes of credit reporting is responsible for updates to a borrower’s credit report. Many times following a foreclosure, there is a limited time for the lender to seek a deficiency judgment. Here is Florida it is one year. If a year goes by, and the lender fails to seek a deficiency judgment then it waives the amount it is still owed after the foreclosure sale of a home.
Here’s the good news: If a lender fails to report a deficiency as having been eliminated, discharged or abolished, it is then reporting inaccurate information. This inaccurate reporting opens the door to the furnisher’s liability under the federal Fair Credit Reporting Act, 15 U.S.C. Section 1681 et seq., (the “FCRA”) per the Ninth Circuit (California) in a recent case. Gross v. CitiMortgage, Inc., 20-17160 (9th Cir. May 16, 2022).
This case is being compared to a leading contempt case, where the Supreme Court in Midland Funding LLC v. Johnson, 137 S.Ct. 1407, (2017) found that a debt collector who filed a proof of claim in a bankruptcy that was obviously barred by the statute of limitations did NOT engage in false, deceptive, misleading, unconscionable, or unfair conduct so there was no violation of the Fair Debt Collection Practices Act. While this decision involved a different set of circumstances and a different law, it is clear that these two views could be considered as inconsistent.
Life Isn’t Meant to be Lived Paycheck to Paycheck
I know there’s been lots of press about the 8.5% inflation rate that was announced this week.
I also know that many people don’t believe that number. Why not?
We started a video series this fall with attorney Melissa Solevilla at Carey, Leisure & Neal, about issues facing our grown children, and how to help them get a good start in their lives. I’m thinking about his now, when I have consult coming up with a former NFL athlete who was involved in an auto accident which was not his fault! The other driver had some insurance, but very little. So who pays for the $400,000 in medical bills???!!! Take a listen below to hear our tips on easy things you can do to avoid such traps.
While everyone was talking about CyberPunks and NFTs on Twitter this weekend, as well as the impact of various amendments to the infrastructure bill and how they may affect cryptocurrencies and development in blockchain tech, there was significant movement on the student loan front.
Reboot Your Life: Tampa Student Loan and Bankruptcy Attorney Blog