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Published on: July 6, 2018

Can the Possible Tax Liability for Forgiven Federal Student Loans lead to an Undue Hardship for Bankruptcy Discharge?

An Iowa appellate court ruled recently that a Income Driven Plan with a zero payment “does not ameliorate the undue hardship”.

In In re Martin, out of the Northern District in Iowa (8th Circuit) the lender argued that the debtor was not entitled to discharge the loans because she would qualify for an income-based repayment program, or IBRP, where she would qualify for a zero payment. In 20 or 25 years, whatever is left on the loans would be forgiven, but the forgiveness could be considered taxable income.

In 20 or 25 years, the debtor would be 70 or 75 years old, and whatever savings she amassed would be consumed by the maturing tax liability. In other words, Judge Collins said, the “tax liability could wipe out all of debtor’s assets not as she is approaching retirement, but as she is in the midst of it.”

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Published on: July 4, 2018

Passport Revocation – Can this Occur if you are in Default on Your Student Loans?

By Christie D. Arkovich, P.A.

U.S. Passports Can Now Be Revoked for Unpaid Taxes — Can this Expand to Include Unpaid Federal Student Loans?

Right now no. Although there are signs that U.S. Passport holders could face a revocation of their passports in the future for defaulted federal student loans.

The reason I say this is because of a new law signed by President Obama in late 2016, implemented in 2017, and now in 2018 is beginning to effect the passports of folks with tax delinquencies.

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Published on: May 27, 2018

Desperate Mother, Teacher, Bus Driver and Student Loan Captive For Life

By Christie D. Arkovich, P.A.

Desperate mother, teacher, bus driver and student loan captive for life.

This is the actual signature line of a client who we are helping with her federal student loans.

The short version of her story: she paid 10 years of consecutive and timely payments only to be told that she had to start all over again with ANOTHER 10 years of payments simply because she had the wrong loan type — and NO ONE at her servicer ever told her this.

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Published on: May 17, 2018

How Do You Know Whether a Debt Collector’s Calls are Harassment?

By Christie D. Arkovich, P.A.

How much is too much? Unfortunately, the Fair Debt Collection Practices Act and its Florida counterpart do not specify a particular number of calls per day that a creditor can make when trying to collect a debt.

An older Florida case is somewhat illustrative in finding the answer. In Story v. J.M. Fields, Inc., 343 So. 2d 675, 677 (Fla. 1st DCA 1977), the Court looked at what conduct was considered harassing, such as: a) the frequency of the creditor’s calls; b) the number of calls; c) the time of day when calls were received (whether during normal business hours); and d) whether the purpose of the calls was appropriate, such as calling to i) remind the debtor of the debt; ii) determine the reasons for non-payment; iii) discuss a plan for making payments.

My rule of thumb that I like to use is if a creditor calls in the morning and talks with you, and then calls again the same day, that only works if you said something like I may get paid at lunchtime and might have some money for you. Otherwise, I doubt that anything changed that day and there was no reasonable reason for a second call the same day other than to harass you.

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Published on: March 24, 2018

Conference Room Furniture For Sale – Good Price

By Christie D. Arkovich, P.A.

We have rented out our second conference room as an office and need to sell the furniture by April 1 if possible. There is an antique oak round table, with two leaves to extend its size, an antique oak bureau and four small chairs. Two single file cabinets free to a good home, fair condition. May be able to deliver if local to South Tampa. Call our office at 813-258-2808 or email me at christie@christiearkovich.com if interested. Thanks!

Published on: March 12, 2018

Student Loan Debtors Getting Kicked Out of Income Driven Plans in Bankruptcy

By Christie D. Arkovich, P.A.

Reports have been surfacing that the Department of Education is kicking borrowers out of Income Driven Plans when they file bankruptcy. It makes no difference if they are in a Chapter 7 or 13. It also doesn’t matter if the debtor is current in their payments. The National Association of Consumer Bankruptcy Attorneys (NACBA) views this as a direct violation of 11 U.S.C. 525 (Protection against Discriminatory Treatment).

There are ways to counter this and remain in an Income Driven Plan to continue progress toward debt forgiveness including Public Service Forgiveness. A new development is spreading across the country to file what is called the Buchannan provisions in a Chapter 13 Plan. We have recently adopted this in Tampa, Florida.

On January 5, 2018, Trustee John Waage and Judge Catherine McEwen agreed to the following Non-Conforming language in In re Hyland, 8-17-bk-01564-CPM that now allows for Income Driven Repayment Plans concurrently with a Chapter 13.

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Published on: March 5, 2018

Has Your Parent Been Denied Long Term Care Insurance due to the Type of Facility?

By Christie D. Arkovich, P.A.

One common problem encountered by caregivers right after they’ve checked in their loved one at a local nursing home or Assisted Living Facility is whether the facility is one that is covered by the elderly parent’s Long Term Care Insurance policy. Does it have enough staff? Enough beds? 24/7 or other nursing care available? What is the facility called and how is it licensed?

Unfortunately, the wrong answers to any of these questions may be grounds for the insurance company to deny coverage. Rather than moving your loved one to another facility, or incurring the out-of-pocket expenses of the preferred location, reach out to a consumer or insurance attorney for help. Most attorneys experienced in this area offer a free intake analysis or consultation to determine if legal representation is warranted. Many represent the client on a contingency basis or hourly basis for short term matters with reasonable payment plans.

Administrative exceptions can be asserted to keep your loved one in the facility of choice. Often it may be the threat of a lawsuit or public exposure to convince an insurance company to do what is right.

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Published on: February 28, 2018

New Procedure Allowed In Tampa Now To Reduce Student Loan Debt When Filing Chapter 13

By Christie D. Arkovich, P.A.

Ignoring your debtor’s federal student loans in their Chapter 13 bankruptcy can have catastrophic circumstances. While fixing vehicle, credit card and mortgage debt, you may have inadvertently allowed a debtor’s $100,000 federal student loan to balloon into nearly $150,000 by doing nothing. This is because the standard procedure of the Department of Education is to place these loans into forbearance during a bankruptcy. However, now in Tampa, we are permitted to use the following Non-Conforming Provision in Chapter 13 Plans to permit our clients to enroll in Income Driven Plans and even Public Service Loan Forgiveness whenever eligible.

On January 5, 2018, Trustee John Waage and Judge Catherine McEwen agreed to the following Non-Conforming language in our client’s case, In re Hyland, 8-17-bk-01564-CPM that now allows for Income Driven Repayment Plans concurrently with a Chapter 13.

The permitted language:

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Published on: February 22, 2018

How to Get a Copy of a Long Term Care Insurance Policy?

By Christie D. Arkovich, P.A.

When a parent reaches the point of needing long term medical or assistive care, sometimes a family member cannot locate the actual policy even if they know a long term care insurance policy exists. How do you get a copy of the policy? One tactic used by insurance companies is to delay everything – including the simple task of complying with a request for a copy of the policy itself. They also know that if the policy’s language (terms and conditions of coverage) is not consulted early on, damaging statements regarding the condition of the insured and the type of care needed are often made to the detriment of obtaining coverage for the insured.

Knowledge of and citation to the Florida statutes should help to get a copy of the long term care policy asap.

Florida law requires insurance companies to promptly communicate with policyholders: “acknowledge and act promptly upon communications with respect to claims.” Fla. Stat. § 626.9541(1)(i)3.c. In addition, another Florida statute requires the insurance company to represent policy provisions accurately and relate claim decisions to applicable policy language. See Fla. Stat. § 626.9541(1)(i)3.b and Fla. Stat. § 626.9541(1)(i)3.f, respectively.

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Published on: February 19, 2018

What to Do When You Believe(d) Your Student Loans Were Discharged in a Prior Bankruptcy

By Christie D. Arkovich, P.A.

There are a ton of people who believed their student loans were discharged when they loans were simply listed in their bankruptcy. It may have been years before the private student loan companies started to communicate with the borrowers to collect this debt which added to that impression.

As it turns out, there may be a way to argue this after all – in instances involving private loans. Private student loan lenders have to prove their loans are in fact “qualified education loans” and meet other criteria in order to be exempt from a general discharge. We are now filing cases where we do not believe the private lenders can meet this burden and the loans are and should have been considered discharged all along. This opens the lender and servicer to a potential FDCPA and FCCPA case if it has tried to collect on previously discharged debt. Moreover, it also opens up the lender to potential claims to refund monies paid toward these loans since discharge.

An easy way around this would have been for the private student loan lenders to have filed their own adversary actions in the debtor’s bankruptcy to obtain a declaratory judgment that its loans were excepted from the general discharge. However, this was never done.

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