The Bankruptcy Law Firm, Prof. Corp.
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…
In re Dockins, ___BR___ (Bankr. W.D.N.C. June 4, 2021)
In re Dockins, ___BR___ (Bankr. W.D.N.C. June 4, 2021), bky case no. 20-10119, holds that, unlike IRAs, Debtors keep inherited 401(k)s because inherited 401(k)s are NOT property of the Debtor’s bankruptcy estate: In the decision, Bankruptcy Judge Hodges explains exemptions never come into play with inherited 401(k)s because inherited 401(k)s aren’t estate property in the first place,. In Clark v. Rameker, 573 U.S. 122 (2014), the Supreme Court held that individual retirement accounts inherited before bankruptcy are not exempt and belong to creditors. It follows, does it not, that a debtor cannot keep a 401(k) inherited before bankruptcy? Answer: Wrong.…
Best v Ocwen Loan Servicing, LLC
BEST v. OCWEN LOAN SERVICING, LLC, 2021 WL 2024716 (Cal Court of Appeal, May 21, 2021), appeal E074386, certified for partial publication: Finding that prior authority to the contrary had been overruled by subsequent United States Supreme Court and state court decisions, a California Court of Appeal recently held that California’s Rosenthal Act (similar to but broader than the federal Fair Debt Collection Practices Act (FDCPA)) can apply to a nonjudicial foreclosure. Best v Ocwen Loan Servicing, LLC,.
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…
U.S. Supreme Court Overturns $1.3 Billion Award Against Kansas Payday Loan Operator
A unanimous Supreme Court on Thursday cut back the Federal Trade Commission’s authority to recover ill-gotten gains, overturning a nearly $1.3 billion award against a professional race car driver who was convicted of cheating consumers through his payday loan businesses. The high court’s ruling takes away what the FTC has called “one of its most important and effective enforcement tools,” used in recouping billions of dollars over the past decade. Justice Stephen Breyer wrote in his opinion for the court that the provision of federal law that the FTC has relied on does not authorize the commission to seek or…
Older Americans Dealing with Rising Debt, Falling Income Amid Pandemic
According to the Employee Benefit Research Institute, the share of households headed by someone 55 or older with debt — from credit cards, mortgages, medical bills and student loans — increased to 68.4 percent in 2019, from 53.8 percent in 1992. Bankruptcy rates among older adults are also rising. The COVID-19 pandemic may be adding to their woes, the New York Times reported. A survey at the end of 2020 by Clever, an online service that connects home buyers and sellers with real estate agents, found that on average, retirees had doubled their non-mortgage debt in 2020 — to $19,200.…