News
New Form Motion
8/1/21 The Bankruptcy Court, CD CA, has just created a new, easy to use, form motion, for consumer debtors to use to seek an order compelling a creditor which has seized an item of debtor’s property, before debtor files bankruptcy, to immediately return that item of property to debtor, after debtor files bankruptcy. Most often, the seized item is debtor’s car/truck/other vehicle, which the secured lender on the vehicle repossessed prepetition, usually because debtor defaulted in making make monthly vehicle payments the debtor owed the secured lender, to repay the secured car loan. The Central District Consumer Bankruptcy Attorneys Association…
What Is an “Executory Contract” Pursuant to 11 USC 365
ABI (American Bankruptcy Institute) Article on What is an “Executory Contract” pursuant to 11 USC §365 : The bankruptcy community needs a better definition of what’s an executory contract, and Prof. Jay Westbrook has it. A decision–In re Financial Oversight and Management Board for Puerto Rico, 17- 3283 (D. P.R. June 29, 2021)–by the district court in restructuring Puerto Rico’s debt demonstrates the gyrations a court must sometimes undertake to conclude that a contract is capable of assumption under the “Countryman” definition of an executory contract. Rather than decide whether a contract is executory under the dueling “Countryman” and “functional”…
As Forbearance Protections End, Nonbank Mortgage Lenders Face High-Volume Processing Tests, Ginnie Mae Risks
Tech-savvy millennials fled to the suburbs during the coronavirus pandemic, fueling a hot housing market that enabled nonbank and fintech mortgage companies to grab a big piece of the growing market share, churning out loans at a faster pace than more traditional bank lenders, according to a Morning Consult report. That booming market has so far shielded a vulnerability. Homeowners had multiple options to buoy their finances, from refinancing opportunities to extra unemployment insurance and stimulus checks. As those programs come to a close this year, most homeowners that took advantage of coronavirus-era policies to delay their loans have now…
Moratorium on Residential Evictions
On 6/29/21 the US Supreme Court refused to overturn the CDC’s (federal Center for Disease Control) nationwide moratorium on residential evictions, which continues to be in effect until the end of July 2021. The petitioners were a coalition of landlords and realtors. The vote against the landlords and realtors was 5-4, with Chief Justice John Roberts Jr. and Justice Brett Kavanaugh joining the liberal members of the court to form a majority. The CDC had said that this is the last moratorium on residential evictions that the CDC will order. But that CDC representation is likely NOT enforceable. In their…
CDC Extends Eviction Moratorium a Month, Says It’s Last Time
The Biden administration on Thursday extended the nationwide ban on evictions for a month to help millions of tenants unable to make rent payments during the coronavirus pandemic but said this is expected to be the last time it does so, the Associated Press reported. Dr. Rochelle Walensky, director of the Centers for Disease Control and Prevention, extended the eviction moratorium from June 30 until July 31. The CDC said that “this is intended to be the final extension of the moratorium.” A Biden administration official said the last month would be used for an “all hands on deck” multi-agency…
EXCLUSIVE U.S. Watchdog to Adopt Mortgage Moratorium Rule with Some Exclusions – Sources
WASHINGTON, June 22 (Reuters) – The federal Consumer Protection Financial Bureau (“CFPB”), which is the U.S. consumer watchdog, will, in coming weeks, adopt a rule requiring mortgage servicers to give struggling homeowners until next year (2022), to resume repayments, but is expected to carve out some groups of borrowers following industry pushback, four people with knowledge of the matter told Reuters. The Consumer Financial Protection Bureau (CFPB) in April proposed, among other measures, a new review process that would generally prohibit mortgage servicers from starting a foreclosure until after Dec. 31, 2021. The rule will throw a lifeline to hundreds…
Child Tax Credit
The California Attorney General Rob Bonta warned today that it is illegal for California creditors, debt collectors, and financial institutions to take Child Tax Credit payments from California families. According to the Attorney General, eligible families will receive $300 a month for young children and $250 per month for families with children between the ages of 6 and 17. The IRS will provide the credit as a monthly payment. “The pandemic has been tough on families across California,” said Bonta. “The Child Tax Credit payments should be a bright spot for our families, putting money in their pockets as the…
Biden Administration Urges Supreme Court to Pass on Student-Loan Bankruptcy Case
Justice Department says Texas woman’s appeal is premature because Department of Education is reviewing whether to relax rules governing student debt in bankruptcy proceedings The Biden administration wants the Supreme Court to pass on an appeal seeking to ease the way for more borrowers to erase their student-loan debt in bankruptcy, saying the Department of Education is already examining the issue. The reasoning was laid out in a court filing Friday by the Justice Department, representing the latest front in efforts from the White House, Congressional Democrats and the U.S. court system to address student-loan debt. An estimated 43 million…
CFPB Sends Notification Letters To Landlords Regarding COVID-19 Evictions
On May 3, 2021, the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC) sent notification letters reminding the nation’s largest apartment landlords of federal protections in place to keep tenants in their homes and stop the spread of COVID-19. The Notification Letter points to the Centers for Disease Control and Prevention (CDC) eviction moratorium for non-payment of rent (CDC Moratorium), which the CDC extended through June 30, 2021, as well as recent guidance from the CFPB and FTC in support of the CDC Moratorium. The Notification Letter also provides an overview of the CFPB’s final rule, effective May…
Analysis: Is the U.S. Student Loan Program Facing a $500 Billion Hole? One Banker Thinks So
In 2018, Betsy DeVos, then U.S. education secretary, called JPMorgan Chase & Co. Chief Executive Jamie Dimon for help. Repayments on federal student loans had come in persistently below projections. Did Dimon know someone who could sort through the finances to determine just how much trouble borrowers were in? Months later, Jeff Courtney, a former JPMorgan executive, arrived in Washington. And that’s when the trouble started, according to an analysis in the Wall Street Journal. According to a report he later produced, over three decades Congress, various administrations and federal watchdogs had systematically made the student loan program look profitable…