Student loan debt has now grown to over $1.5 trillion. Despite a relatively strong economy, more than 8 million borrowers are delinquent or are in default under their loans. Of particular concern to lenders is that these figures will only worsen if economists’ predictions for a slowing economy ring true.
In the last edition of this newsletter, Ed Schnitzer provided us with an excellent summary of the how and when a mediator may determine the absence of good faith. With an eye on topics of interest, Don Swanson republished Ed’s article on his weekly blog with an invitation for comment. I did just that and my response elicited further comment from many colleagues.
ABI has been running a mediation training program in conjunction with St. John’s Law School each December for the past nine years. This program stands apart from other programs that are available for training in a more generalized capacity.
When seeking to collect post-petition fees from a chapter 7 debtor, beware of the conversion. If former counsel files a collection action against a debtor for post-petition fees in state court, failing to stay the action after a conversion to a chapter 13 case will result in a stay violation.
The Ethics and Professional Compensation Committee had an active 2018. We strived to continue to provide our members with enlightening and useful substantive information, while also offering enjoyable and valuable social and networking opportunities.
The chapter 7 trustee, in a July 2018 ruling, was denied compensation for services that were held to be “customary and statutory duties” that provided no further benefit to the bankruptcy estate and were not outside of those normal duties.
In In re D’Arata,[1] the bankruptcy court ordered debtor’s counsel to disgorge the fee he received to represent the debtor in a chapter 7 case. The court also discussed and cautioned against the use of appearance counsel.
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Student loan debt is (mostly) presumed nondischargeable under § 523(a)(8).[1] Hardship discharge of such debt has become a vanishingly probable outcome.
Beth Stephens and Richard Cole, co-chairs of the ABI Consumer Committee this year, thank all committee members for their support and participation in 2018. The Consumer Committee has a diverse membership.
