News
SB 1099
Description: On August 30th, California Senate Bill 1099 was delivered to Governor Newsom’s desk for signature. NACBA is very proud to be the official sponsor of SB 1099. Join NACBA’s California working group as they walk you through the significant improvements to CA’s bankruptcy exemption laws & how you can apply them for your clients. WHY YOU SHOULD ATTEND: NACBA’s California working group assisted Senator Bob Wieckowski, the bill’s author, in getting these significant improvements to California’s bankruptcy laws. Highlights of SB 1099 that will be discussed include: “Ride through” option restored for vehicles (no more repos for failure to…
The federal Consumer Financial Protection Bureau (“CFPB”) Adds New Debt Collection Rule FAQs
Last week, the CFPB published additional frequently asked questions on Regulation F, its debt collection rule. The new FAQs address third-party communications, electronic communications, and unusual or inconvenient time and place provisions. Prohibitions on Third-Party Communications. The FAQs address the following questions: What is the Debt Collection Rule’s general prohibition on third-party communications? Are there exceptions to the general prohibition against third-party communications? Does the general prohibition on third-party communications apply to electronic communications from a debt collector about a debt? Electronic Communications. The FAQs address the following questions: Does the Debt Collection Rule require debt collectors to communicate electronically…
Commentary: The Aging Student Debtors of America
Americans aged 62 and older are the fastest-growing demographic of student borrowers, according to a commentary in the New Yorker. Of the 45 million Americans who hold student debt, one in five are more than 50 years old. Between 2004 and 2018, student loan balances for borrowers over 50 increased by 512 percent. Perhaps because policymakers have considered student debt as the burden of upwardly mobile young people, inaction has seemed a reasonable response, as if time itself will solve the problem. But in an era of declining wages and rising debt, Americans are not aging out of their student…
President Biden Signed Into Law the Bill Raising the Debt Limit for Subchapter V of Chapter 11 and Chapter 13
On 6/21/22, President Biden signed into law the bill raising the debt limit for Subchapter V of Chapter 11 back to 7.5 million dollars, permanently, and raising the debt limit for ch13 to $2.75 million (total 2.75 million secured and unsecured debt, together). This is a beneficial and necessary change, including because the 2.75 million debt limit for Subchapter V of Chapter 11 was too low, and the debt limit for Chapter 13 (the individual wage earner repayment plan chapter of bankruptcy) was also too low, including because of high inflation.
In Older Americans, Rising Debt May Adversely Affect Health
The New York Times Newspaper reported on 6/5/22, updated 6/6/22, that research shows that debt has risen among older people, and those who owe are more likely to have multiple diagnosed illnesses. Denise Revel had a history of developing blood clots, so in 2011, when her leg grew painfully swollen and hot to the touch, she knew what to do. She headed for the emergency room. She recovered from the clot but could not pay the medical bill. Working as a fitness instructor, she had no health insurance. “I’ve always been financially challenged,” said Ms. Revel, 62, who lives with…
$5.8 Billion in Loans Will Be Forgiven for Corinthian Colleges Students
In its largest student loan forgiveness action ever, the Education Department said on Wednesday, 6/1/22, that it will wipe out $5.8 billion owed by 560,000 borrowers who attended Corinthian Colleges, one of the nation’s biggest for-profit college chains before Corinthian College collapsed in 2015, the New York Times reported.
9th and 4th Circuit Both Hold: Old Bankruptcies Aren’t Grounds for Removal to Federal Court
This month, two circuits found no ‘related to’ bankruptcy jurisdiction for climate-change lawsuits against energy companies, and therefore held those climate change suits could NOT properly be removed to Bankruptcy Court. On 4/19/22 the Ninth Circuit Court of Appeals held, in County of San Mateo v. Chevron Corp., ___F.4th___ (9th Cir. April 19, 2022), appeal No. 18-15499, that a climate change suit was not properly removed from nonbky court to bankruptcy court. That was the second time in 12 days, a circuit court has held that a chapter 11 plan confirmed by an energy company doesn’t permit multinational oil companies…
DC Solar owner Jeff Carpoff was sentenced to 30 years in federal prison in connection with defrauding investors
American Bankruptcy Institute (“ABI”) reports that In the fall of 2021, DC Solar owner Jeff Carpoff was sentenced to 30 years in federal prison in connection with defrauding investors (and taxpayers) out of over $2B through a Ponzi scheme involving favorable tax credits that incentivize investments in sustainable energy. The fraud, described by the Department of Justice as “the largest criminal fraud scheme in the history of the Eastern District of California” was uncovered shortly after a Christmas 2018 government raid on DC Solar’s headquarters which caused the company to file a Chapter 11 bankruptcy case, in Bankruptcy Court, Eastern…
Biden Aims to Expand Access to Student-Loan Debt Forgiveness for Millions of People
The Biden administration said it plans to make it easier for lower-income student-loan borrowers to get debt forgiveness through an existing program that has enrolled millions of people, but provided few with relief, the Wall Street Journal reported. The move, announced by the Education Department on Tuesday, is part of a politically sensitive debate on the forgiveness of student-loan debt and attempts to more broadly overhaul how the student-loan repayment system works. President Biden earlier this month extended to Aug. 31 a pandemic-related pause on payments of federal student loans and faces pressure from progressive members of his own party…
Democrats Press Biden to Extend Freeze on Student Loan Payments
American Bankruptcy Institute on 03/25/22 reports: Democrats in Congress are pressing the Biden administration to extend the suspension of student loan payments before it’s set to expire May 1 as they seek to avoid cutting off a pandemic-induced benefit in the middle of an election year, The Hill reported. The federal student loan payments suspension has already been extended five times throughout the COVID-19 pandemic since it began under former President Trump in March 2020. That means millions of people who owe student loans to the federal government haven’t been required to make payments on their debt in two years,…