Facing a new regulatory crackdown that they say will severely impact their business, Uber and Lyft made an unusual proposal to New York City’s government: stand down, and in exchange we’ll bail out struggling yellow taxi drivers. The response was a polite no thanks.The proposal — to create a $100 million “hardship fund” to support individual taxi medallion owners — was “summarily rejected” by the City Council and Mayor Bill de Blasio’s office, Joe Okpaku, Lyft’s vice president for public policy, told The Verge. “It’s a little bit astonishing to us.”  Of course, there were strings attached. The ride-sharing companies, including carpooling service Via, wanted the city to drop its proposals to cap the number of new Uber and Lyft vehicles and set a wage floor for drivers. In exchange, they said they would create this fund that they claim would pay out “tens of thousands of dollars” to individual medallion owners “right away.” The companies would contribute $20 million a year for five years to the fund to support medallion owners. It was intended to help individual medallion owners, though, and not corporate owners who hold multiple medallions. Okpaku said he has spoken to the Robin Hood Foundation about executing the fund, but a spokesperson for the foundation says talks are just preliminary and no deal has been reached. A spokesperson for Uber said the company does not comment on private conversations. Uber and Lyft claim a cap on vehicle licenses would send wait times soaring and driver earnings plummeting. They also say a cap would disproportionately affect outer borough residents, including low-income communities and people of color. “The cap bill would set things back to a time when service levels were horrible in the outer boroughs,” Okpaku said. The offer to bail out taxi drivers is an unforeseen twist in the years-long struggle by New York City regulators to contain the explosion of ride-hailing app drivers. City Council members have said they were partly motivated by the plight of taxi medallion owners, who have seen the value of their licenses plummet in recent years in direct correlation to the rise of ride-hailing apps. Six taxi drivers have committed suicide in the last six months, a grim reminder of the human costs of technological disruption. Uber’s response to the proposed bills was to go on the offensive. A message appears on the homepage of its app for New York City users with the title, “Arriving now: Higher prices and increased wait times.” The company has been calling Uber customers directly, asking them to send messages of support for Uber to their council members, according to BuzzFeed. Lyft has been emailing customers with its own appeal to “speak up for ridesharing.” (Not part of the effort? Any in-app trolling of local politicians. In 2015, when Mayor de Blasio first proposed restricting the number of Uber and Lyft drivers, Uber responded by creating a “DE BLASIO” option in its app that made all the cars disappear.)  With its offer, Uber and Lyft appear to be trying to muddy the conversation around the proposed regulation, which may be voted on as soon as next week. It puts pressure on the mayor and the City Council to respond with their own proposal to rescue underwater medallion owners. For its part, the city believes its already doing that. “The Administration believes the Council’s approach remains the most holistic way to help drivers support their families and to address congestion,” a spokesperson for the mayor said in a statement.The City Council agrees. “From the very beginning, the council has engaged with all stakeholders on this legislative package,” a spokesperson for Council Speaker Corey Johnson said. “Those dialogues were extremely productive and informed the proposals that we put forth. We don’t negotiate in public, but we can say that we are confident the bills that will be voted on will help drivers, reduce congestion and bring fairness to the industry.”“Lyft and other high-volume for hire vehicle companies are welcome to establish such a fund with a non-profit and assist drivers who are experiencing serious financial difficulties,” he added. “They don’t need any Council authority to do that.” Update August 1st 6:48 pm ET: A previous version of this story said Lyft was working the Robin Hood Foundation to create a fund for taxi drivers. While Lyft has reached out to Robin Hood Foundation about the fund, talks are just preliminary and no deal has been reached. The story has been modified to reflect this. © 2018 Vox Media, Inc. All Rights Reserved 

Millennial marriages are crumbling under student loan debt.

How a cheap car payment can help you on the bankruptcy means test. The 2005 Bankruptcy law, known BAPCPA or sometimes BARF, was designed to make bankruptcy much more painful for families making over the average income in each state.  For Virginia, in the summer of 2018, that’s $103,549 for a family of 4. Or […] The post How a cheap car payment can help you on the bankruptcy means test. by Robert Weed appeared first on Robert Weed.

    In Matter of Lopez, No. 17-50297, 2018 WL 3626628 (5th Cir. July 31, 2018) the chapter 13 Debtors sold their Texas home post-petition, and did not use the funds to purchase another home.  The chapter 13 was filed in 2009, and confirmed.  In 2014 the debtors filed a nunc pro tunc motion to sell the property, indicating that the property had actually been sold in 2011 with a wrap around note and balloon mortgage, asserting that they needed the money to pay for mandatory eye surgery.    The trustee objected, noting that under Viegelahn v. Frost (In re Frost),1 proceeds of sales of homestead lost its exempt status if not reinvested in another homestead within 6 months, and therefore the funds could not properly be used for eye surgery.       The bankruptcy court approved the sale, but required all net proceeds (after payment of liens and closing costs) to be paid to the trustee.  Both the trustee and the debtors filed motions to amend the confirmed plan, the trustee to require turnover of the proceeds, and the debtors requesting to be allowed to keep $20,000 needed for the eye surgery.  The bankruptcy court granted the debtor's motion, allowing payment for the surgery but requiring the balance to be paid into the plan, unless the debtors dismissed their case.  The court indicated that if the case was dismissed they could keep all the funds, at the cost of the loss of the discharge.  Later that month the title company paid the $42,148.58 proceeds from the balloon payment on the sale to the chapter 13 trustee.   At a subsequent hearing the court allowed the debtors to dismiss the case, and directed the trustee to refund the proceeds to the debtors, less the trustee fee.   The district court reversed, finding that the proceeds should have been distributed to the creditors, finding that cause existed under 11 U.S.C. §349(b) to abrogate the general rule that all proceeds would vest in the debtors upon dismissal of the case.  The debtors appealed to the 5th circuit.  The 5th Circuit initially noted that it was undisputed that the proceeds lost their exempt status when they were not used to purchase a new homestead within six months.  In determining whether the property vests back in the debtor on dismissal, the court examined the principles underlying chapter 13.  Chapter 13 is a wholly voluntary alternative to chapter 7, allowing debtor's to retain property if they repay debts over a 3 - 5 year period.  The chapter 13 estate includes post-petition earnings and property as well as property held as of the date the case was filed.  Finally, debtors have the right to voluntarily dismiss the case under §1307 at any time, though such request can be denied for bad faith conduct or abuse of the bankruptcy process.    Section 349(b) states that:Unless the court, for cause, orders otherwise, a dismissal of a case other than under section 742 of this title ...(3) revests the property of the estate in the entity in which such property was vested immediately before the commencement of the case under this title.    Neither 'vest' nor 'revest' are defined in the code.  Black’s Law Dictionary defines “vest” to mean, in relevant part: “[t]o confer ownership (of property) on a person”; “[t]o invest (a person) with the full title to property”; or “[t]o give (a person) an immediate, fixed right of present or future enjoyment.” VEST, Black’s Law Dictionary (Bryan A. Garner ed., 10th ed. 2014). To “revest” means “[t]o clothe or vest again or anew, as with rank, authority, or ownership.” REVEST, Black’s Law Dictionary.   The homestead was clearly vested in the debtors upon the filing of the bankruptcy case, thus holding that it revests in them upon dismissal best comports with §349(b)'s to return to debtors property of the estate upon dismissal.  §349(b)'s purpose is to, as far as practicable, restore property rights upon dismissal to where they were prior to the filing of the case.      The court further found that the trustee lacks inherent authority to distribute property to creditors after dismissal of a case.  Such authority is permitted only upon the express terms of a plan.  The court also rejected the trustee's argument that the funds should be distributed to creditors based on the debtors' bad faith.  The 5th Circuit fount it was not “left with the definite and firm conviction” that the bankruptcy court erred in determining that there was no “cause” to order that the homestead proceeds be kept from the Debtors.  The debtors had proposed to surrender a vehicle when they got behind in payments to the trustee, and to propose payment of a lump sum from the sale (less the surgery proceeds) to help reduce the arrearages.  Further, the fact that the debtors made four years of payments on the plan mitigate against a finding of bad faith.  The debtor's homestead was not property of the estate, and prior to the Frost decision, the debtors would not have been put on notice that the proceeds could become property of the estate.  Thus the homestead proceeds vested in the debtors upon dismissal of the case and must be turned over to the debtors.Michael Barnett www.hillsboroughbankruptcy.com  1 744 F.3d 384 (5th Cir. 2014)↩

One of the most common questions that we’re asked by clients who own “underwater taxi medallions” (where the value of the medallions is less than the amount of the loan secured by the medallions) that are owned by a corporation or a LLC is if we can “cram down” the taxi medallion loan in a chapter 11 bankruptcy filing. “Cram down” means that the bank/secured lender is required to accept less than full repayment of their loan. If it were possible to cram down the average taxi medallion loan, the result would be advantageous to many taxi medallion owners–however, the reality is more complicated. For purposes of illustration, let’s assume that a corporation or an LLC owns one medallion that is subject to a $700,000 bank loan and the medallion has a current value of $165,000. Section 506(a) of the Bankruptcy Code provides that the bank (secured lender) has a secured claim of $165,000 (the value of the medallion) and an unsecured claim of $535,000 ($700,000 less $165,000). In a typical chapter 11 case under this scenario, the secured portion of the lender’s claim would be paid the present value of $165,000 over the duration of the plan (which could be five or more years) and the unsecured portion of the claim would be paid pennies on the dollar (let’s assume for this example 10 cents on the dollar or $16,500). Accordingly, in the chapter 11 plan, the bank would be paid a total of $222,120.02 ($205,620.02 (the present value of $165,000 over five years at a discount rate of 4.5%) + $16,500) over the duration of the plan instead of $700,000.The above scenario would be a wonderful result for the underwater taxi medallion owner, but it’s difficult to achieve. Section 1111 of the Bankruptcy Code governs claims and interests in a chapter 11 caseand § 1129 pertains to the confirmation of a chapter 11 plan. With respect to the confirmation of a chapter 11 plan, the following needs to be noted:In this author’s experience, about 10% of the chapter 11 bankruptcy filings for small businesses in the Southern District of New York are confirmed.2.      It’s an expensive process to file a chapter 11 bankruptcy.  The filing fee is $1,717, the debtor’s legal fees are approximately $20,000 to $25,000, U.S. Trustee quarterly filing fees must be paid and the debtor (medallion owner) needs to obtain insurance, set up debtor-in-possession bank accounts and file monthly operating reports with the U.S. Trustee’s office (necessitating the retention of an accountant or an accounting firm).  3.      To be confirmed, a chapter 11 plan must pass several tests.  One of these tests is the “best interest of creditors” test–creditors must not receive less in chapter 11 reorganization then they would if the case was filed as a chapter 7 liquidation. What that means is if the medallion is worth $165,000, then the secured creditor in a chapter 11 case must receive payments with a present value of $165,001. The plan proponent must also show “feasibility,” that the debtor will be able to make the payments required under the plan based on future earnings or assets or property that they own.4.      Section 1129(b)(2)(a) of the Bankruptcy Code provides three possibilities related to the “fair and equitable” test to “cram down” a secured creditor: (1) full payment of the claim through a new loan at market value interest secured by the pre–petition collateral (not possible in the present market for taxi medallions); (2) sell the collateral with liens attached in the proceeds of the sale (not possible for taxi medallion owners who wants to continue to own their medallion); or (3) they must give the secured creditor the “indubitable equivalent” of its claim (essentially, payment in full or abandonment of the collateral to the lender).5.      If the above obstacles to confirmation of a chapter 11 plan were not enough, there is yet another hurdle–§ 1111(b)(2)  of the Bankruptcy Code, which provides that if the loan was made on a non-recourse basis to the debtor, then the secured creditor can elect to have the full amount of their loan treated as secured (under our fact pattern to have their secured loan valued at  $700,000 not $165,000).  A non–recourse loan means that the loan documents provide that in the case of a foreclosure, the secured creditor is only able to obtain possession or seek recourse against the medallion and other collateral for the loan and not any other assets of the debtor. Having reviewed the loan documents for many medallions, including the promissory note, the security agreement and the UCC-1 filing, it is this author’s experience that the vast majority of taxi medallion loans are non–recourse; accordingly, the secured creditor has the right and will be expected to make the §1111(b)(2) election. Moreover, since most taxi medallions are subject to a loan, the debtor must make loan payments and most medallions subject to a loan are not profitable, if the § 1111(b)(2) election is made, it will be almost impossible for an underwater taxi medallion owner to confirm a chapter 11 plan.So, if the “cram down” of a secured creditor in chapter 11 bankruptcy isn’t possible, what is the underwater taxi medallion owner to do? We believe that the optimal strategy is to do the following: (1) retain an experienced attorney for asset protection planning (proactive legal action that protects your assets from future creditors, divorce, lawsuits or judgments); (2) engage in aggressive negotiations with the bank to refinance the loan or negotiate to surrender the medallion and other collateral for the loan; and (3) if the negotiations are unsuccessful, the taxi medallion owner (or guarantor) should consider filing for chapter 7 bankruptcy. Medallion owners who own underwater taxi medallions are encouraged to contact Jim Shenwick and arrange for a consultation to discuss the best solution for them. Jim Shenwick.

As a Troy, Ohio bankruptcy attorney, I often find that potential clients do not understand bankruptcy counseling requirements. With very few exceptions, anyone who is filing Chapter 7 or Chapter 13 bankruptcy must participate in both pre-bankruptcy counseling and pre-discharge counseling. The exceptions are: Active military service member in combat zone Emergency filing to stop foreclosure or wage garnishment Mental incapacity (cannot understand counseling) Counseling not available within five days of request Because counseling is widely available by telephone and over the internet, there are very few exceptions granted for physical disabilities. What is pre-bankruptcy counseling? When the bankruptcy laws were modified to prevent abuse, one of the steps that were taken was to require debtors to take a counseling course before filing bankruptcy. This course is designed to inform a debtor of their options. In most cases, the counseling agency will help debtors prepare a budget; the goal is to see if Chapter 13 is possible. Once a debtor has filed bankruptcy, they must provide the court with a certificate of completion not later than 15 days after filing. Credit counseling must be from an agency approved by the U.S Trustee’s office and completed within a 180-day period prior to filing bankruptcy. What is post-bankruptcy counseling? Before a Chapter 7 or Chapter 13 bankruptcy may be discharged, the debtor must complete a second counseling session. This course is commonly known as a “personal financial management course” and must last a minimum of two hours. Like the pre-bankruptcy counseling, it must be administered by an agency approved by the U.S. Trustee’s office. The timing is also important: Chapter 7 filers must present the proof of attendance (by presenting Form 23) no later than 45 days after the creditor’s meeting. Chapter 13 filers must present the confirmation before making the last plan payment.   Residents of the Troy, Ohio area who are considering filing bankruptcy should contact the Chris Wesner Law Office, LLC. We can help ensure you are in compliance with all counseling requirements. The post Troy, Ohio Bankruptcy Attorney Explains Bankruptcy Counseling Requirements appeared first on Chris Wesner Law Office.

It’s human nature to hold out for a hopeful solution when things are going bad, even when it’s a financial crisis. When money problems arise, people have a tendency to look for ways out that include selling their home, taking on another job or selling other valuable assets. It seems as though filing for bankruptcy is pushed to the back-burner until things are at their absolute worst. While filing for bankruptcy is a big decision, it’s one that should be considered when you find yourself in troubling financial times. Reasons Why People Hold Off Filing for Bankruptcy There are a couple of main reasons why people may hold off filing for bankruptcy: fear of the unknown, and not fully understanding the benefits of bankruptcy. People believe they’ll be looked down upon if they file because they believe it’s financially irresponsible to file for bankruptcy. There are many reasons why you may file for bankruptcy, none of which make you financially irresponsible. Perhaps you lost a job unexpectedly, or became ill and found yourself out of work for a long time. It’s not always about finding yourself drowning in debt because you lived above your means, and it really makes no difference what others think. This is about your life and getting your finances back on track, no matter the reasons. Facing Your Fears One of the hardest aspects of bankruptcy is facing your fears. But, once you do so, you’ll find yourself facing a chance at debt relief, moving to a future that gives you a fresh financial start. Meet with an experienced Troy, Ohio Bankruptcy Attorney who can sit with you and discusses your fears in order to have a better understanding of the entire bankruptcy process. Set up a consultation with us today. The post Conquer Your Fears By Consulting with an Experienced Troy, Ohio Bankruptcy Attorney appeared first on Chris Wesner Law Office.

One of the most common questions people ask themselves and experienced Troy, Ohio bankruptcy attorneys when considering filing for bankruptcy is whether they should file, or if they should consider other alternatives. This is a difficult question that really has no set answer. Determining whether bankruptcy is right for you depends on many things, so it’s extremely important that you’re properly informed about bankruptcy. You’ll want to know if you are even eligible to file for bankruptcy, and if so, what types. We’ll explain. Eligibility and Types As an individual filer, there are two different types of bankruptcy you may be eligible for: Chapter 7 and Chapter 13. Determining eligibility depends on a few different factors based on your income. If you file for Chapter 7 bankruptcy, your income must be limited and unreliable. If you have a steady job with a consistent income stream, you’ll most likely qualify for Chapter 13 bankruptcy. Determining Bankruptcy Benefits Even though there are many misconceptions about bankruptcy, filing for bankruptcy can mean a financially stable future. One of the biggest advantages of bankruptcy is allowing you to eliminate, reduce, or restructure your debt. And, it’s important to note that filing for bankruptcy does not mean you’ll lose everything, it is just a way to help you get through a difficult financial time. Retain an Experienced Attorney There are a number of reasons why you have found yourself in financial difficulties, including medical issues and an unexpected job loss. Once you have come to terms with the fact that it’s okay to ask for help, contact us for professional and experienced bankruptcy representation. The post A Troy, Ohio Bankruptcy Attorney Explains the Importance of Understanding the Bankruptcy Process appeared first on Chris Wesner Law Office.

You should never suffer abuse or harassment just because you owe a debt. However, as a Troy, Ohio Bankruptcy Attorney, I have heard many horror stories. People sometimes fall on hard times. We all make mistakes and getting in over our head is stressful enough. This is why, in 1977, Congress passed the Fair Debt Collection Practices Act. Consumers needed  protection from the abuses of debt collections. In Ohio, debt collection abuse protection does not stop with the federal law. The Ohio Attorney General‘s office states, “The federal Fair Debt Collection Practices Act and the Ohio Consumer Sales Practices Act cover consumer debts used primarily for personal, family or household purposes, such as credit cards, auto loans, utility bills, medical bills, mortgages and some student loans.” There are three main areas of prohibited practices: Abuse and Harassment, Misleading or False Statements, and Unfair or Unjust Practices. Abuse and Harassment – A debt collector can not use foul language. They cannot intentionally work to annoy you. They are not allowed to harm or threaten to harm you. A debt collector may not publicly embarrass you by publishing your information. Misleading or False Statements – When attempting to collect a debt, the debt collector cannot misrepresent the balance owed or themselves. They are not allowed to tell you they are a police officer or represent a government agency. They may not imply your nonpayment will lead to an arrest. Unfair or Unjust Practices – A debt collector is not allowed to disclose information to a 3rd party. They are not allowed to increase your balance except as allowed by law. They cannot make collect calls. They may not prematurely deposit a postdated check. If you send a debt collector a written dispute of the debt within 30 days of their first contact, you may ask for and they then must provide: A fully itemized breakdown of the debt, A description of the product or services purchased, The debtor information including name, address, and last 4 numbers of their Social Security number, The original creditor’s full name and address, and Any and all supporting documentation for the debt. Once you dispute the balance owed, a debt collector is not permitted to contact you until they validate the debt. Ensure you mail the dispute using certified, return receipt mail. Also, keep a written record of all communication including phone calls. The documentation is important if you ever go to court. If you would like to talk more about debt collection abuse in Ohio, or need more information, please contact us. The post Troy, Ohio Bankruptcy Attorney Discusses Debt Collection Abuse appeared first on Chris Wesner Law Office.

If you are one of the millions of Americans who have never had to deal with a debt collector, count yourself lucky. As a Troy, Ohio Bankruptcy Attorney, I often discuss the importance of the Fair Debt Collection Practices Act (FDCPA) with clients and how it applies to bankruptcy. The FDCPA is a federal law created to protect consumers from deceptive and abusive debt collection practices. The methods employed before the law passed in 1977 were appalling. The Fair Debt Collection Practices Act sets a legal framework for the practices of debt collectors and sets both administrative and civil penalties for violations. It also defines a debt collector as a person or company in the business of collecting a debt. This does not include an original creditor’s internal collectors. Under the Fair Debt Collection Practices Act, a debt collector may not: Contact you at home before 8 in the morning or 9 at night, Continue communication after you give written notice to stop, Repeatedly call or make your phone ring with the intent to annoy or harass, Call you at work if they know calls are prohibited, Contact you directly if they know you have an attorney, Continue to communicate if you request a verification of the debt and they have yet to provide it, Make false or misleading statements, Publish your personal information and publicly list you as having bad debt, Attempt to collect an unjust amount prohibited by law, Threaten to have you arrested or take legal action not permitted, Use abusive or foul language, Threaten any form of violence, Communicate the debt to 3rd parties, Contact you by postcard or any media with the intent to embarrass, and Report false and inaccurate information to the credit bureaus. Moreover, many who decided to file bankruptcy do it because of abusive debt collectors. If the attempts to collect a debt violate the FDCPA, the consumer may sue the creditor for actual and statutory damages. The Bankruptcy Code can protection your from the effects of the debt, and the FDCPA allows you to fight back against abusive practices. If you would like to talk more about the Fair Credit Collection Practices Act, or need more information, please contact us. The post Troy, Ohio Bankruptcy Attorney Talks About the Fair Debt Collection Practices Act appeared first on Chris Wesner Law Office.