Biden to Cancel $5.8 Billion in Student Loans

The Biden administration announced on Thursday, August 19, 2021 that it will be automatically wiping out the federal student loan debt for 323,000 borrowers, as reported by Forbes.com.

Bankruptcy Law Firm Agrees to Pay More than $300,000 in Relief

 

National Consumer Bankruptcy Law Firm Agrees to Pay More than $300,000 in Relief to Consumers and to a Six-Year Practice Ban in Settlement with U.S. Trustee Program

The Department of Justice’s U.S. Trustee Program (USTP) has entered into a settlement with national consumer bankruptcy law firm Deighan Law LLC, previously known as Law Solutions Chicago and doing business as UpRight Law (UpRight).  The settlement is set forth in a consent order entered by the Bankruptcy Court for the District of Montana on March 9 and resolves enforcement actions filed by the USTP over allegations of misconduct relating to UpRight’s representation of Montana consumers as debtors or prospective debtors in bankruptcy cases.  As stipulated in the settlement, UpRight has paid or will pay more than $300,000 in monetary relief and will be barred from representing bankruptcy clients in Montana for six years.

Read the entire news release from the Department of Justice at  https://www.justice.gov/opa/pr/national-consumer-bankruptcy-law-firm-agrees-pay-more-300000-relief-consumers-and-six-year?fbclid=IwAR0OtB9MjHhbUiIMtHOP27U35aC7oSQnlbFmVGWJ1d-xytIn44EBj_ou4Q4

BEAUTIFUL NEW OFFICE

 

I am pleased to announce I have moved into my new office in Green Cove Springs. This office, while still convenient to Clay, Bradford, and Duval Counties, it is significantly more convenient to St. Johns County and Putnam County.

As we all know, we are still working our way through the COVID-19 pandemic. While not downplaying the effects of the pandemic on our lives, our family, our community and our economy, it has caused us to take pause and consider life from a different perspective; we have slowed down and taken account of what is important to us; and from a business perspective, as many have learned to work from home, we have learned how to transact business virtually.

While I am excited to show off my new office, I am still offering virtual consultations either by phone or computer platforms such as Zoom. This is wonderful for both my clients that have difficulty traveling and for those in outlying counties.

My new address is

722 North Orange Avenue, Green Cove Springs, Florida 32043,

and my phone number is still 904-652-0060.

President Biden Extends Parts of the CARES Act

 

President Joe Biden signed the “COVID-19 Bankruptcy Relief Extension Act” into law to extend provisions providing financially distressed consumers and small businesses greater access to bankruptcy relief. The legislation extended personal and small business bankruptcy relief provisions that were part of the CARES Act through March 27, 2022. 

The is significant, especially for small businesses electing to file under subchapter V.  See H.R. 1651; however, the “Consolidated Appropriations Act of 2021” (CAA) was not extended.

Other bankruptcy provisions extended to 2022 by the COVID-19 Bankruptcy Relief Extension Act include:

• Amending the definition of “income” in the Bankruptcy Code for chapters 7 and 13 to exclude coronavirus-related payments from the federal government from being treated as “income” for purposes of filing bankruptcy.
• Clarifying that the calculation of disposable income for purposes of confirming a chapter 13 plan shall not include coronavirus-related payments.
• Explicitly permitting individuals and families currently in chapter 13 to seek payment plan modifications, including extending their payments for up to seven years.

If you find yourself either experiencing financial difficulties, or foresee the possibility of financial difficulties, as a result of the pandemic, you should seek the advise of a competent bankruptcy professional in your area that can help you come up with a financial game plan moving forward.

IRS Extends Tax Filing Deadline For 2020 Taxes

The Treasury Department and Internal Revenue Service announced today that the federal income tax filing due date for individuals for the 2020 tax year will be automatically extended from April 15, 2021, to May 17, 2021. The IRS will be providing formal guidance in the coming days. 

Earlier this year, following the disaster declarations issued by the Federal Emergency Management Agency (FEMA), the IRS announced relief for victims of the February winter storms in Texas, Oklahoma and Louisiana. These states have until June 15, 2021, to file various individual and business tax returns and make tax payments. This extension to May 17 does not affect the June deadline. See the following articles:

https://www.irs.gov/newsroom/tax-day-for-individuals-extended-to-may-17-treasury-irs-extend-filing-and-payment-deadline

https://www.bloomberg.com/news/articles/2021-03-17/irs-plans-to-delay-tax-deadline-to-mid-may-after-chaotic-year

Covid 19 Foreclosure Moratoriums Extended

 

FORECLOSURE MORATORIUMS

The vaccine rollout is proceeding, but the economic effects of the pandemic are still being assessed.  There is some relief for borrowers whose mortgages are backed or owned by the federal government. The moratorium on foreclosures imposed by the Federal Housing Administration (FHA), Veterans Administration, the U.S. Department of Agriculture (USDA), Fannie Mae, and Freddie Mac will remain in effect until June 30, 2021.

 

The bad news is, eventually the mortgages will have to be paid up.  While it is not known what the government will do regarding the mortgage arrears, some attorneys are anticipating an avalanche of foreclosure filings which may lead to an avalanche of bankruptcy filings.  

 

Keep in mind, the moratorium is not mortgage relief.  Once the moratoriums end, the mortgage arrearage will have to be paid.  You may want to call a consumer advocate attorney in your area to see what options you may have.

Repossession/Bankruptcy: Can I get my car back?

From time to time the Supreme Court of the United States makes a decision regarding a bankruptcy matter. Most recently the Court decided City Of Chicago, Illinois vs. Fulton in January of 2021. In this case, the city of Chicago repossessed a vehicle for failure to pay fines. Shortly thereafter the owner of the vehicle filed a Chapter 13 petition, and demanded a return of the vehicle under a provision of the bankruptcy code known as the Automatic Stay (11 U.S.C § 362). More specifically, 11 U.S.C. § 362(a)(3) prohibits “any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate.”

The Court recognized there was a split in authority regarding whether property had to be automatically returned upon the filing of a petition for bankruptcy, or whether it required a motion before the court for a turnover of the property. The Court ended up holding that 11 U.S.C. § 362(a)(3) essentially stopped any affirmative actions to repossess after the bankruptcy had been filed, and did not contain any affirmative provision to automatically return the property. That is, the creditor recognized the creditor was simply holding the property status quo. The procedure for the return of the property should be by motion to the court.

The Court also made it clear this decision was limited to 11 U.S.C. § 362(a)(3), and that there may be other provisions of the bankruptcy code by which the debtor may be able to demand a return of his vehicle, such as 11 U.S.C. § 542, but since that was not before the Court, the Court did not make a ruling as to the applicability of 11 U.S.C. § 542.

This ruling does not seem to have any effect on Florida which follows Bell-Tel Fed. Credit Union, consistent with City Of Chicago, Illinois vs. Fulton, which recognizes the turnover provisions of the bankruptcy code operate as to the property of the estate. In Bell-Tell the Court looked to see if the debtor still had legal or equitable interest in the property. In Bell-Tell the Court held that since the repossession occurred because the debtor breached his agreement with the lender (failure to make payments), the debtor only held a right of redemption, and legal ownership interest in the vehicle passed to the creditor upon the creditor taking possession pursuant to Florida; the vehicle was not part of the estate. If you have a vehicle, or other property that has been repossessed, or you think may be repossessed, I encourage you to seek the advise of a competent bankruptcy attorney in your state.