The question of does a lien exist without a debt for it to secure is a complicated issue that unfortunately does not have a universal answer. This post will use two recent cases to explore concerns that counsel should examine if presented with this question.
A New York bankruptcy court recently allowed a pro se debtor to discharge over $200,000 in student loan debt, vehemently rejecting as “punitive” more recent legal authority concerning how student loan debts may be discharged in bankruptcy.
A version of this article previously appeared in the December 2019 issue of the Receiver, a publication of the National Association of Federal Equity Receivers.
The work of a receiver can be a difficult balancing act. With various creditors and debts that need to be paid, there can be a long and meticulous resolution process. In order for receivers to protect themselves from the risk of personal liability for claims made by the government, it is imperative that receivers understand the Federal Priority Act (“FPA”).
On January 7, 2020, the presidential campaign of Senator Elizabeth Warren released a plan to overhaul the consumer bankruptcy system in the United States. The plan would repeal means testing and other provisions of the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act. It would also implement enhanced protections for consumer debtors who file for bankruptcy.
The Bankruptcy Protector has previously provided a succinct summary of all cases decided post-Jevichere and
The laws of preferential and fraudulent transfers under the Bankruptcy Code can often seem theoretical and formulaic. When certain boxes are checked, it appears, at first blush, that a pre-bankruptcy transfer can be avoided, regardless of any intent or surrounding circumstances.
Prepayment premiums (also referred to as make-whole premiums) are a common feature in loan documents, allowing lenders to recover a lump-sum amount if a borrower pays off loan obligations prior to maturity, effectively compensating lenders for yield that they would have otherwise received absent prepayment. As a result of the widespread use of such provisions, three circuit courts of appeal – the U.S. Court of Appeal for the Second, Third and Fifth Circuit – have recently had to address the enforceability of prepayment provisions in bankruptcy.
The U.S. Supreme Court heard oral arguments on December 3, 2019 in Simon E. Rodriguez v. Federal Deposit Insurance Corp., 18-1269 (Sup. Ct.).
Loan servicers’ employees are human beings. Loan servicing employees use systems designed by other human beings. We all know this and so should anticipate that there will be mistakes in loan servicing operations. Recently, the Seventh Circuit Court of Appeals reminded us that how loan servicers plan for and react to inevitable mistakes is important. The case also has some good reminders for litigation counsel and planning tips for loan servicers.
On November 12, 2019, the First Circuit Court of Appeals ruled that bankruptcy trustees may sue colleges and universities to recover pre-bankruptcy tuition payments received from parents of adult children. This is the first case decided by a court of appeals on an issue that has divided the lower courts for several years.