Data on motorcycle users reveals that rider demographics are changing. In the 1980s, the majority of motorcyclists were young men in their 20s. Now, however, the average age of riders is 41, though most motorcyclists are still men.
The Los Angeles Times reports that about 11 million motorcycles have been sold in America, and the rider population has reached 6.6 million. In addition, the size and weight of motorcycles has increased over the years - in 1990, less than half of the motorcycles ridden were larger than 749 cc; now almost all motorcycles ridden are larger than 749 cc.
According to the Motorcycle Safety Foundation, despite the growing use of motorcycles, motorcyclists account for only 0.5 percent of all vehicle miles traveled in the U.S. However, motorcycle fatalities account for about 10 percent of all motor-vehicle fatalities.
]]> Understanding why these crashes occur and why they are so deadly is important to reducing motorcycle crashes and making safety improvements. And, a large study funded by the federal government as well as industry organizations seeks to do just that.The study examines motorcycle accidents by sending independent investigators to analyze crash scenes. According to the Los Angeles Times, investigators evaluate about 2,000 variables related to the crash, including vehicle inspections, witness interviews and medical records of people hurt or killed in the crash.
This information then is analyzed to identify human, vehicle and environmental factors that may have caused the accident, and it is compared to the experiences of two similar riders who drove on the same part of the road at the same time of day but who were not in crashes. The comparison motorcyclists must have the same motorcycle type and be of similar age and driving experience.
Data from the study also will be compared with two previous studies on motorcycle crashes: the Hurt Study in Los Angeles in the 1980s and the MAIDS Report on motorcycles crashes in Europe in 1999-2000. Researchers expect the final analysis to be released in 2013, when safety improvements can be made for riders, roads and vehicles to avoid tragic motorcycle accidents throughout the U.S.
]]>That car accident could have happened anywhere. Tennessee's distracted driving laws are very similar to Kentucky's. All drivers are prohibited from texting while driving, but unlike teen drivers and bus drivers, commercial truck drivers and most other motorists can make handheld or hands-free phone calls without getting a ticket.
Banning cell phone use will not eliminate every distracted driving accident. According to the National Highway Traffic Safety Administration (NHTSA), driver inattention is the primary factor behind most car crashes and near misses. Making cell phone calls and checking voicemail have been found to be as bad for driver attention as drunk driving, but applying makeup, selecting audio tracks on an iPod, or changing a CD can also take a driver's attention off the road ahead at a critical moment.
]]> Highway safety research continues to bear this out. A NHTSA naturalistic driving study found that a driver's participation in secondary tasks was a factor in more than 22 percent of all incidents recorded by highway safety researchers over more than a year of study of 100 specially equipped vehicles. Statistics from 2009 show that one in every six highway fatalities involved distracted driving, a total of almost 5,500 wrongful deaths.The numbers don't lie, and a Tennessee car accident lawyer must continue to seek out evidence of distraction to help a client prove that another driver's negligence caused severe damage, serious injuries and other harm.
]]>For some couples, disagreement can be resolved through negotiation or other dispute-resolution techniques. For others, however, the conflict may simmer, boiling over into the children's relationship with the parents.
What Is Parental Alienation Syndrome?
Parental alienation syndrome is a controversial concept that details the changing relationships between divorcing parents and their child. Even when there is no strong reason for alienation, such as abuse, the child becomes the ally of one parent and rejects the other parent. This is due to the strong influence of one parent over the child's preferences and perceptions.
While some researchers and writers advocate for parental alienation syndrome as a widely accepted diagnosis, others argue that the concept lacks validity. Whatever the outcome of the debate, the syndrome seems to be gaining traction in the national consciousness.
]]> How Can Parental Alienation Syndrome Be Avoided?Parental alienation syndrome is not in the best interests of the child, who could be deprived of a nurturing relationship with one of his or her parents. It is therefore important, not just for the alienated parent but for the child, to prevent parental alienation syndrome.
Parents should be sure not to talk negatively about the other parent around the child. They should also cooperate with the other parent as much as possible, in addition to being vigilant about recognizing potential problems.
Nashville child custody disputes are difficult on parents in any case. But the more the parents are cognizant of the effects of their dispute on the children, and try to lessen the negative consequences of the dispute, parental alienation syndrome may be avoided.
]]>As is the case with many legal questions, the answer is: It depends.
While student loans are notoriously difficult to discharge in bankruptcy, it may be possible to do so in certain situations. For many courts, the standard is whether the student loans are causing the debtor "undue hardship."
Undue hardship is not a term that courts take lightly. Many courts use the Brunner test, whose name is taken from an influential case. To measure whether a person has truly shown undue hardship, the court must see that:
The issue of student loans' ability to be discharged in bankruptcy is a contentious one for lawmakers and former students alike. Lawmakers, including a congressman from Tennessee, have been introducing bills for years, attempting make it easier to discharge student loans. Their efforts have not yielded much success - but they have not stopped trying yet.
A debtor who is considering bankruptcy and has a large amount of student loans should contact an experienced bankruptcy attorney. An attorney will be able to assess the situation and explain the process of attempting to have student loans discharged through bankruptcy.
]]>The National Bankruptcy Research Center (NBRC), which serves as one of the premier sources for the most current bankruptcy research and statistics, published findings that January filings were down from the previous year. In February, March and April 2011, the NBRC found that filings continued to decline nationally.
However, Georgia, Utah, Tennessee and California have experienced a higher rate of bankruptcy filings than the national average in 2010.
]]> Rising gas prices and unemployment have compromised some families' abilities to meet monthly obligations. Still, the nation's economy is experiencing an upturn. Companies are creating jobs and some companies, such as Chrysler, are reporting profits for the first time in years. The decline in bankruptcy filings may correlate with improvements in the country's financial picture.A person should never feel guilt or shame for having to consider bankruptcy. In the past, many saw filing for bankruptcy as taboo; today, however, many people - celebrities, congressmen, business owners and individuals - have sought protection under the Bankruptcy Code. Understanding the process and expectations can lead a person back to the road of financial stability.
]]>Among other things, Dr. Himmelstein cautions that state legislators, looking for somewhere to further cut budgets in light of record deficits, should not cut medical benefits.
The 62 Percent Rate Calculated Before the Great Recession
The warning is based on the results of the study, which showed a 49.6 percent increase from 2001 to 2007 in medical bankruptcies. This means there was a large increase even before the great recession began.
The study implies bankruptcy filings caused by high medical expenses will continue to rise in 2010 and 2011.
With many people's insurance coverage inadequate and many more people losing their jobs, medical bills will force many more people to file for bankruptcy.
]]> Inadequate InsuranceDr. Himmelstein was quoted as saying, "Most people who are driven into bankruptcy by illness and medical bills actually have coverage but it's such inadequate coverage that it doesn't keep them from financial ruin. They're facing huge premiums and copayments and deductibles - and things that aren't covered by their insurance."
The Massachusetts state health-reform law, which served as a model for the national debate, he notes, "g[a]ve people really inadequate coverage. It traded uninsurance for underinsurance. That really didn't work. When people were seriously ill, they ended up with such huge medical bills that they really didn't have coverage that could keep them out of the bankruptcy court."
In other words, if state legislators think they can save money by cutting medical benefits, the result may be an increase in the number of bankruptcy filings.
Bankruptcy can be a refuge for people struggling with medical bills. Bankruptcy will end the harassing phone calls and flood of bills demanding payment. An experienced attorney can answer your questions and guide you through the bankruptcy process toward a fresh start and peace of mind.
]]>Most mortgages in Tennessee are actually deeds of trust. This is a legal device that allows the lien on your property to be held by a trust. The trustee or substitute trustee (usually one law firm handles the original loan and deed of trust when you bought the house or refinanced and a different law firm handles the foreclosure sale, hence the "substitute" trustee) is allowed to sell the real estate/home if the borrower/homeowner violates the terms of the trust upon 20 days' "public notice." Missing one or more payments on the promissory note and security agreement is normally the event(s) which triggers the default clause and causes the creditor/mortgage to try to sell the property at foreclosure to get their mortgage loan paid back with the sale proceeds.
]]> In simpler terms, if you don't pay your house payments, the creditor will try to sell your house to pay your debt to him. Historically, home ownership in the United States has been a symbol of the American Dream, and the law courts and legislatures have provided protections to land owners before their real estate can be taken from them and sold.The most fundamental protections for property owners are the 5th and 14th amendments of the U.S. Constitution, which require "due process of law," as well as the Tennessee Constitution. The U.S. Supreme Court has ruled that "due process of law" requires "notice and an opportunity to be heard" before someone can take away your property. So before your house can be sold at a foreclosure sale and taken away from you, you are entitled to be notified that someone is trying to take away your property and you have a right to an "opportunity to be heard" to express why they should not be allowed to take your property.
However, your "opportunity to be heard" can be waived in the deed of trust you signed when you obtained the loan on the property. Tennessee is one of only 5 states that allow foreclosure sales of real estate with no court overseeing the process. The law of Tennessee allows the borrower (you) and the lender (mortgage company, bank, individual, etc.) to enter an agreement whereby your real estate can be sold without a court being involved, as long as proper "notice" is given. I do want to be clear that a borrower/consumer can still challenge an effort by the lender to foreclose on real estate, despite language in the deed of trust. It is necessary, however, for the property owner challenging the foreclosure to sue the lender and request that a court issue a restraining order to stop the foreclosure sale while the issues are being determined. From a practical standpoint, the burden shifts to the property owner to establish to the court that legitimate grounds exist to challenge the defendant and that irreparable harm will occur if the foreclosure is not stopped. In addition, legal fees for matters such as these (temporary restraining orders, injunctionary relief, etc.) are normally expensive. Also, surety bonds are required in many cases as well as court costs and filing fees, all expenses a property owner facing foreclosure is hardly prepared to undertake.
Under Tennessee state law, "notice" of a lender's intent to foreclose pursuant to powers granted by a deed of trust is satisfied if 20 days' notice is given to the property owner by "publication in a newspaper of general circulation" in the county in Tennessee where the property is located.
The publication is normally the advertisement in the classified ads of a local newspaper, with titles like "Notice of Substitute Trustee's Sale." They usually take up a couple of columns of newsprint and somewhere in the fine print are the property address and the last property owner of record. The legal description is included with the metes and bounds, degrees of angles defining the property lines, and other arcane language and terms of art specific to property surveys. The idea is that a property owner has an opportunity to see the notice of sale and take steps to keep the property, perhaps by negotiating an agreement with the trustee over the deed of trust, filing a lawsuit to obtain a temporary restraining order, or filing a bankruptcy to invoke the automatic stay and stop the foreclosure.
In rural areas of Tennessee, notice by publication is effective since local residents regularly read these notices in their local county newspaper. They routinely call the property owner to make sure the owner knows that their house is about to be sold at foreclosure sale. The property owner has likely already received several letters from the mortgage company advising of a default in the note and deed of trust and a letter identifying the time, date, and place for the foreclosure sale by the time the first notice is published in the newspaper. Nonetheless, my experience is that the "concerned" neighbor has kept many a home from being sold at a foreclosure sale. In more urban areas, the property owner is more likely to be contacted by real estate agents and speculators, attorneys sending letters to the property owner soliciting Chapter 13 bankruptcy business, or other third parties who don't personally know the debtor.
The notice is clearly necessary and there is little debate over that. The 20-day notice period is also not an issue. The issue is whether the mortgage holder (creditor) has to publish it just once or three (3) times for successive weeks as the current Tennessee law requires.
Publishing the foreclosure sale advertisement can be misleading because it is not unusual for a notice to be published, the arrears on the mortgage to be brought current, and the advertisement pulled and not published again. The three successive publications act to provide an uninterrupted warning prior to the property owner losing the home/property to a foreclosure sale. Regrettably, many newspapers require the mortgage company to buy all 3 weeks of advertisement as a package. If a bankruptcy is filed, the mortgage company/bank should cease further publication of the sale or else risk sanctions for violations of the automatic stay of 11 U.S.C. Section 362. Hopefully, competition amongst newspapers for foreclosure advertising will prompt enterprising ad departments to sell foreclosure advertising notices on a per publication (weekly) basis.
A federal law that comes into play with notice of a foreclosure sale is the Fair Debt Collection Practices Act (FDCPA). The FDCPA is a law that regulates debt collectors and their conduct in attempting to collect debts. This law applies to collection agencies, lawyers, and practically any third party who is collecting a debt for another person or entity, say a hospital. This act does not apply to those collecting a debt for themselves. For example, if the hospital uses their own employees to try to collect a debt, they would most likely not be subject to the FDCPA. However, if they authorized or assigned the account to a collection agency to collect the debt, both the collection agency and hospital would be under the jurisdiction of the FDCPA.
An effort by a mortgage company (bank/individual) to foreclose on your home is considered an "effort to collect a debt." The mortgage company or bank would be subject to the FDCPA, but the individual who holds a mortgage on your home would not be subject to the FDCPA if they tried to handle the foreclosure themselves.
Mortgage companies, banks, loan servicing companies, etc. are normally organized and operate as a corporation, limited liability company (LLC) or some other type of artificial person organized under state law. Corporations, LLCs, etc. cannot represent themselves. An attorney must represent them. The president or chief executive officer (CEO) cannot represent the corporation. They would be practicing law without a license (a crime in Tennessee).
Since an attorney must represent a mortgage company or bank, they are always subject to the FDCPA. Therefore, if you miss payments on your mortgage and the mortgage company/bank declares a default, you would normally first receive a letter from the mortgage company/bank giving you notice of the default. At that point, the mortgage company/bank would still be using "in house" collection efforts (their own people) and they would not be subject to the FDCPA. However, if you were unable to resolve the default in payments with the mortgage company/bank and they turned the matter over to a lawyer, the requirements of the FDCPA would kick in. Thus, any correspondence you received from the lawyer would notify you that their letter was "an attempt to collect a debt" and if you did not dispute the validity of the debt in writing within 30 days, then a legal presumption would arise that the debt is valid. This is very important, because if you fail to dispute the debt in writing and you are later sued, the creditor does not have to prove the validity of the debt. The creditor has in effect shifted the burden of proof to you to prove the debt is invalid.
Proving the validity of the debt can be expensive and problematic for the creditor if you dispute its validity. The business records are hearsay without the custodian of those business records, and if the custodian of the records is in another state, there may be significant travel costs to bring the custodian to court in Tennessee.
Even more potentially troublesome for the holder of your mortgage is identifying whom the custodian even is. As astonishing as this may sound, with the securitization of mortgages over the last decade, efforts at spreading risk to thousands of different entities have created legal black holes where ownership right may be more a matter of faith than substance. If your mortgage has been sold into a pool of other mortgages, you have the right under the Real Estate Settlement Procedures Act (RESPA) to request any and all documents related to the origination of your loan, any later transfers on assignment of any or all of the rights attached to that mortgage, and an accounting associated with the costs and servicing of such transfers. A request for such documents could form the basis for a dispute or questioning of the validity of a debt secured by your deed of trust.
To be continued...
]]>Automatic Stay
Those who file for protection under the Bankruptcy Code gain the advantage of an automatic stay, so named because it takes effect immediately upon filing and it puts a hold on collection actions. Creditors must suspend efforts to collect debts unless they seek and are granted relief from the automatic stay. The automatic stay applies to all collection actions, including actions to repossess vehicles, furniture or other assets, and actions to foreclose home mortgages.
]]> No-Asset FilingIn a Chapter 7 bankruptcy, the debtor is allowed to keep property that is exempted from the bankruptcy estate. For example, some or all of the debtor's equity in one vehicle and the homestead may be exempt. Property that is subject to an enforceable lien will be returned to the secured creditor or in some cases, the debtor may wish to reaffirm the debt and keep the property.
In most Chapter 7 bankruptcies, once the exempt property and collateral for secured debts is removed, there is nothing of monetary value left in the bankruptcy estate. In these cases, the bankruptcy trustee files a no-asset report with the court and there are no assets to be sold and therefore no distributions to unsecured creditors. Unsecured creditors are not required to file proofs of claim in a no-asset bankruptcy.
Even though there is no distribution to unsecured creditors in a no-asset case, the dischargeable debts will still be discharged in a Chapter 7 bankruptcy. The debtor will be allowed to keep exempt assets and still get a fresh start. When faced with a financially debilitating job loss, accident or divorce speak with an experienced bankruptcy attorney about bankruptcy options and alternatives.
]]>During this time, more and more consumers began to carefully examine where and how they spent their money. A recent Time Magazine article notes that 78 percent of Americans changed their shopping habits during the recession. Nearly a year and a half later, the shopping patterns that many people developed during the recession are expected to linger for some time to come.
While consumers backing off high-end luxury goods was expected, many shoppers are saving money on essential items, including groceries, by doing more research before they hit the stores and changing where they shop altogether. Retail Forward, a leading consumer research firm, found that one in five shoppers changed grocery stores over the past few years to save money.
]]> Many retailers are also adapting to the changing behaviors of the post-recession shopper. The Wall Street Journal notes that many stores are reacting to the changing needs of consumers by taking a "back to basics" approach, which includes offering more store private label and store brand goods.Working With an Attorney
While the recession may technically be over, high unemployment rates and an uncertain economic future mean that a change in shopping patterns will not be enough for many consumers. Bankruptcy, while not the first choice for many people, maybe the best option to get out from under debt.
For those who find that bankruptcy is right for them, they will not be alone. According to the American Bankruptcy Institute, over 1.5 million consumers filed for personal bankruptcy in 2009, the largest number of filings in the past five years.
If you find yourself falling behind on bills or mortgage payments, it is important to contact an experienced bankruptcy attorney in your area.
]]>Many who choose to file for bankruptcy, however, forget the benefits of bankruptcy. Bankruptcy is an option for struggling Americans as a way to provide a financial fresh start. Individuals who file for bankruptcy have often tried without luck to pay their debts outright and the legal process of bankruptcy allows the individual to eliminate all or a portion of debt.
The process for filing bankruptcy involves the discharge or repayment of debt under the supervision of a judge. Relying on the advice of a bankruptcy lawyer often helps the process of bankruptcy move more smoothly, as the court will need to see significant documentation about the individual's assets, liabilities, debts, income and other financial information.
]]> Pros of Filing for BankruptcyThe biggest reason consumers turn to bankruptcy is because it enables the debt to be either removed or renegotiated. Both Chapter 7 and Chapter 13 bankruptcy allow a consumer to move on from the financial mistakes made in the past and start a new financial beginning without the burden of excessive debt. In many cases, consumers are also able to keep their home from foreclosure by filing for bankruptcy.
Another common benefit of filing for bankruptcy is that creditors are no longer able to contact an individual who is behind on payments. Individuals who are behind on debt frequently receive calls demanding the payment of debt. Those nuisance calls must cease upon the filing of bankruptcy because the law creates an automatic stay. Creditors who continue to call or harass for the collection of debt are in contempt of court.
Cons of Filing for Bankruptcy
Consumers considering bankruptcy often worry about the damage to their credit score and their ability to gain credit in the future. While this is a personal concern that should be discussed with a bankruptcy lawyer prior to filling, it is important to remember that the path to bankruptcy often does significant damage to one's credit report. In some cases, consumers who file for bankruptcy may see an improvement in their credit score because the large, unsecured debt may be discharged.
Also, consumers often wonder about their ability to gain credit again. Bankruptcy can remain on a credit report for up to ten years, but a study released by the Credit Research Center found that 33 percent of consumers who had recently filed for bankruptcy obtain credit within three years of filing. Another 50 percent are able to obtain a line of credit within five years.
Bankruptcy is available to allow consumers to move on from past mistakes. While there are some disadvantages in filing for bankruptcy, many consumers who choose to file for bankruptcy find that they are better off in the long run because they are able to find reprieve from the financial burden of debt.
]]>What Is A Reverse Mortgage?
A reverse mortgage is a financial instrument that allows you to extract the value (equity) out of your home, in much the same manner that a traditional mortgage puts equity into your home by your monthly payments.
With this contract, you would typically receive monthly check from the reverse mortgage holder, for a specified period. It has the advantage of providing you will a steady cash flow, allowing you to augment your income and pay your debts.
]]> Now, there are a few things to keep in mind. You need to have equity in your home. If your mortgage is underwater, a bankruptcy is probably a better option. If you have children that you want to leave your house to, or some portion of the proceeds, your children will receive nothing, as the reverse mortgage will consume all of the value.If you do not have children or other heirs, and you need a steady flow of cash, the reverse mortgage can be a helpful tool. You want to be careful when obtaining such a loan, as there are many who want to take advantage of the elderly in this situation.
Speak with a trusted financial advisor, and make sure you fully understand all of the fine print, so you are not saddled with excessive fees or unfair terms.
What Are The Benefits Of Bankruptcy?
Bankruptcy offers advantages to many overwhelmed with debt. If you have no equity in a home, a Chapter 7 allows you to discharge much of your debt, and obtain a fresh final start. If you do have a home that you want to save, a Chapter 13 may provide that opportunity. With a Chapter 13, you create a plan that allows you to repay most of your secured debts over a three to five year period.
A Chapter 13 allows you to keep a home, as long as you can make your regular mortgage payments and its value does not exceed your state's homestead exemption. The advantage of the plan is mortgage arrears can be paid through the plan, as well as other debts. This should permit the freeing up of enough cash flow to maintain your mortgage.
Some debts are non-dischargeable; student loans, spousal and child support, certain types of taxes, and criminal fines. These would also have to be paid in the plan, and any balance remaining would survive the bankruptcy.
Need Advice On Your Options?
The choice between a reverse mortgage and bankruptcy can be confusing. The answer requires a close look at your financial status and weighting the pros and cons of each option.
An experienced bankruptcy attorney can help you review your options, and help you determine which strategy best fits your unique personal situation.
]]>One Chapter 11 attorney says the amendments placed tremendous restraints on companies' liquidity when they file for protection. The act increased the number of creditors who must be paid in full prior to discharge. Adding to an already expensive process means that some small- and medium-sized corporations can no longer afford to file for bankruptcy. Chapter 11 costs already may include fees for lawyers, financial advisers, accountants and investment bankers, and smaller companies cannot bear the cost of more high-priority claims.
Another bankruptcy lawyer says that the amended Chapter 11 offers judges less flexibility in the process. The new law took away some of the discretion judges had to consider the individual circumstances of each debtor, also making it harder on insolvent businesses.
Difficult Interpretation
Bankruptcy Judge Pamela Pepper says judges have had difficulty deciphering the new law's unclear language. She also says that some provisions create unfairness to one involved party under any of the plausible interpretations. She refers to a "somewhat fascinating level of frustration expressed by judges over the unworkability or at least the unwieldiness of certain provisions of BAPCPA."
Businesses and individuals considering filing for protection under the new bankruptcy laws should speak with an attorney about bankruptcy and bankruptcy alternatives.
]]>Lois R. Lupica, a New York bankruptcy attorney who authored the study, believes that prospective debtors see as much as a 55 percent cost increase compared to those filing bankruptcy before 2005. She says that bankruptcy is "far more complicated a process than it was before the 2005 amendments." As such, the cost increases can be attributed to additional attorneys fees, trustee fees, filing fee increases as well as credit counseling and debtor education classes, which are now required under the BAPCPA.
]]> Ms. Lupica also notes that while higher upfront costs may discourage some debtors to pursue bankruptcy, they also result in creditors receiving less money compared to what they received prior to reform.The study found that the cost for Chapter 13 debtors, the cost for filing bankruptcy increased from $2,930 in 2003 and 2004, to $4,077 in 2007 and 2008. For Chapter 7 debtors, such costs increased from $900 to $1,399. The data compiled from 2000 cases over six judicial districts represents the first stage of the two-part study. The second stage will survey data from 10,000 bankruptcy cases over 90 districts.
Despite the cost increases, bankruptcy remains a good option for those in financial straits. It allows debtors to reorganize debts to save assets, especially those facing foreclosure. For questions about how much bankruptcy may cost you, and how you can achieve a fresh financial start, contact an experienced bankruptcy attorney.
]]>The "cramdown" allows a borrower to have their mortgage rewritten to reflect the current value of the property that secures the loan. In a bankruptcy, that current value is used to secure part of the debt and the other portion of the loan, above the value of the property, is turned into "unsecured" debt and is treated in the bankruptcy plan in the same manner as other unsecured debts, like credit cards.
]]> Using Chapter 12 Bankruptcy in the 1980s as a ModelThe commentary by Thomas J. Fitzpatrick IV and James B. Thomson looks at the effect of the creation of Chapter 12 and the 1980s farm crises. The farm crises of the 1980s was similar to the current situation with home mortgage foreclosures, in that speculation fueled a run-up in prices of farmland in the late 1970s and 1980s, only for a similar "bust" to occur in the early 1980s. This crash in farm prices left many farmers with too great a debt load, insufficient cash flow to service that debt and land that was no longer worth the value of the mortgages attached to it.
One response by Congress was to add Chapter 12 to the Bankruptcy Code. Chapter 12 permitted modifications of the mortgages on principal residences of family farmers. There was much wailing and gnashing of teeth by the bankers. The authors note "At the time, opponents of stripdowns made the same arguments people are raising today: Allowing stripdowns would flood bankruptcy courts, permit abuse by borrowers who could afford to pay their loans, and reduce the availability of credit, among other things." "Stripdown" is synonymous with "cramdown" and refers to stripping down the mortgage to the market value of the collateral.
"Cramdown" Could Force Banks to Negotiate Mortgage Modifications
As with the current climate, Congress created the stripdown provision "for farmers because voluntary modification efforts, even when subsidized by the government, did not lead agricultural lenders to negotiate loan modifications." As today, banks are very reluctant to renegotiate loans, even when the government provides incentives. It is only when the "market" force of potential judicially enforced "cramdowns" appear, do banks provide good-faith options.
The resistance to accepting the prospect of wide scale loan modifications is hard to understand. If all the borrowers who cannot afford their current mortgages file bankruptcy and walk away from their loans, the holders of those notes will be far worse off than if they had accepted a loan modification. The 'floodgates' of sales of distressed properties would be opened and further damage a market already in a very weak condition, which could precipitate a further collapse of the housing market.
]]>Here in Tennessee, more than one in four children ages five and under lives in poverty. More than 100,000 Tennesseans sank into poverty last year; poverty grew at 1.4 percent here, faster than the national average of 1 percent.
The New York Times reports that nationally, 44 million Americans were living below the poverty line in 2009, an increase of four million in just a year's time. That translates in 17 percent of the Tennessee population and 14 percent nationally.
Millions more in the middle class are on the edge of real hardship, worried that they'll lose their jobs and health insurance and no longer be able to pay their rent or meet their mortgage payments.
]]> Relief for Struggling Americans Is SlowDespite a wealth of platitudes from politicians in both parties, critics say precious little has been done to help the middle class survive the economic crisis.
With unemployment stuck around 10 percent, people are wondering what it will take for politicians to take the extraordinary steps needed to turn things around.
Anyone who has looked at the stock market in recent months knows that corporate profits are on the rise as are revenues in the bailed-out financial sector. While some politicians insist that the good economic times will return if we cut taxes on corporations and the wealthy, others claim that the rich are getting richer by buying up assets from consumers too anxious or financially pressed to afford to hang on to stocks or property.
For Some Americans, Bankruptcy Is the Only Option
Bankruptcy rates continue to climb, as Americans increasingly use the legal tools available to help them get out from under unmanageable debts.
Many Americans struggling with unemployment, credit card bills, medical bills and other debts opt for Chapter 7 liquidation bankruptcy. They can discharge all eligible debt and get a clean start in their financial lives, rebuilding credit and saving assets that matter most, such as equity in their homes, retirement pensions and motor vehicles.
Others opt for Chapter 13 reorganization bankruptcy so that they can discharge unsecured debts, prevent foreclosure and preserve assets such as cars and other items.
]]>