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ffcraOur firm used to do a lot of employee rights cases, but we reduced that area of practice when we elected to focus on foreclosure defense and student loan work.  Recently though, we have had a few clients with questions about what happens to their income if they or an immediate family member should get sick with COVID-19.  One of our attorneys suggested I post the following to help answer these questions:

WHAT ARE YOUR RIGHTS UNDER THE FAMILY FIRST CORONAVIRUS RESPONSE ACT (FFCRA)?

The Act requires certain employers to provide their employees with paid sick leave and expanded family and medical leave for specified reasons relating to COVID-19.  These provisions are applicable between April 1, 2020, through December 31, 2020.

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We were interviewed by the Penny Hoarder this week in their story “How You Could Get a Temporary Break from Student Loans Due to COVID-19.”

You should also check out our recent blog post “Watch Out for These Pitfalls that may come with Suspended Federal Student Loan Interest.”

Under the right circumstances, a six month forbearance with non-accrual of interest will help a lot of folks.  But beware that not everyone will qualify for this and their credit could be impaired if payments are not made.  An income driven plan starting right now could be a better option for those with FFEL loans!  You can also have your current income driven plan recalculated if your income or hours have dropped recently.

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The CARE Act passed over the weekend extends the 60 day forbearance, interest waiver for all Direct Loans, and collection activities for 6 months.  Until the Department of Education can update its rules to be CARE compliant, here is a summary of what to expect:

Coronavirus and Forbearance Info for Students, Borrowers, and Parents

Interest Suspension:

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https://www.tampabankruptcylawyerblog.com/wp-content/uploads/sites/10/2015/07/christie_d._arkovich_p.a_1_small.jpgHow do you determine if the COVID-19 federal law waiving interest applies to your federal student loans?  The most recent changes are summarized here in a nice Q&A format:  https://studentaid.gov/announcements-events/coronavirus.

My take on all this:  The Act suspends student loan payments and interest accrual through September 30. For those in federal loan forgiveness programs, those months will count as months in which payments were made.

Now for the finer points:  for the interest waiver, not all federal loans count, only Direct Loans and those Federal Family Education Loans (FFEL) which are owned by the government.  Most FFEL loans are owned by third parties and only guaranteed by the government.  Perkins Loans are owned by the institution and the interest waiver does not apply either.  Eighty percent of all federal loans were FFEL loans before the FFEL program was discontinued in 2010.  I’d estimate one-quarter to one half of all federal loans are still FFEL loans.

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While our physical location is closed, our Arkovich Law team are hard at work at home filing motions to abate Chapter 13 Plans, Modifying Confirmed Plans, helping with our clients’ real estate needs, settling all sorts of debt, and assisting with estate planning needs.  This blog is addressed toward our small businesses in the Tampa Bay area:

If you are a small business owner, make sure to apply for the Paycheck Protection Program through your local bank in order to maintain your workforce and to receive full forgiveness after the 8 week period.  Make sure you are able to return to work in 8 weeks with your business fully intact and awesome!

Also, if you experience additional business hardship, you can apply for a SBA Bridge Loan.

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For you landlords out there or for your residential property managers, what about this idea for your tenants who are unable to pay rent?

It allows a 50% reduction in rent to be paid by using escrowed deposits for two months, replenishment within 180 days, and extends the lease for two months.  Those deposit accounts are sitting around doing nothing, we may as well be using them!!  Tenant pays nothing now, and landlord gets 50% now.

If you like this idea, please share (but add my email in case a landlord or property manager would like legal advice on how to handle a specific matter).  Christie@christiearkovich.com.

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One of our clients had a sale date on March 25, 2020 that was moved to May 20, 2020.  While our clients had already moved out, they are very appreciative of the additional time to safely remove their belongings.  There is a lot more relief to come!

This benefits the mortgage companies too in that it keeps their employee and contractor activity to a minimum to turn around this property during our Safer at Home period of time.

“HUD issued letter dated March 18, 2020, “to inform mortgagees of foreclosure and eviction moratorium for all FHA-insured Single Family Mortgages for a period of 60-days.” The letter can be found at:

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grocery-cart-emptyMy first consult this week was for a former client who just learned of a bank garnishment of his joint bank account with his wife from an old Cach final judgment that he thought was vacated and dismissed.  The entire account was frozen.  Plus his wife’s next check couldn’t be stopped from being deposited and taken.

How did he learn of this?  When he was at the grocery store to buy food for his family in the midst of the COVID-19 crisis.  After carefully avoiding everyone and loading his cart with what he could find – he walked away with nothing.  He didn’t have money to pay us, but since we had been compassionate to him in the past, he thought, why not contact us, perhaps there is something we could do.

Fortunately, we were able to secure with the opposing attorney, a dissolution of the writ of garnishment and all the money in his joint bank account will be released in just a day or two.  In the meantime, our client has borrowed some funds from a neighbor.  This could happen to anyone — this client had no idea that this old judgment was out there, and that bank account was his emergency fund.  He lost his job in Europe and had no credit cards.  His wife works at a local Tampa Bay retailer and just had her hours cut.  I sincerely appreciate opposing counsel who timely communicated with me in this urgent matter to get it resolved now and without the necessity of a court hearing, which could take a few weeks!

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