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From: CNN Politics
By: Eric Bradner and Arlette Saenz, CNN

 Sat March 14, 2020

(CNN)  Former Vice President Joe Biden says he now backs Massachusetts Sen. Elizabeth Warren's bankruptcy plan, endorsing his former Democratic rival's proposal to repeal portions of a law they had clashed over 15 years earlier.
Biden touted his support for Warren's plan as an olive branch to supporters of Vermont Sen. Bernie Sanders in a virtual town hall for Illinois voters Friday night, calling it "one of the things that I think Bernie and I will agree on." He highlighted a portion of Warren's plan that would allow student loan debt to be eliminated in bankruptcy just like other debts. "I'm going to endorse -- I've endorsed -- Elizabeth Warren's bankruptcy proposal, which in fact goes further, allows for student debt to be relieved in bankruptcy, provides for a whole range of other issues that allows us to in fact impact on how people are dealing with their circumstances," Biden said. "So there's a whole range of things we agree on."
Biden's move to back Warren's plan shows that, as he moves toward clinching the Democratic presidential nomination and seeks to soothe over tensions from a year-long intra-party battle, the former vice president is taking steps to embrace his former rivals and adopt planks of their platforms -- and is willing to move left to do so.  Warren's team got a heads-up from the Biden camp that he would be endorsing the senator's bankruptcy plan ahead of his public announcement on Friday, a Warren aide told CNN's MJ Lee. The two teams were in touch leading up to the announcement, the aide said. A Biden campaign aide said he would likely say more about his support for Warren's bankruptcy plan in his debate against Sanders on Sunday night.  Biden and Warren's high-profile battle over a 2005 bill that made it more difficult to declare bankruptcy, when he was a Delaware senator and leading advocate of the measure and she was a Harvard professor and vocal opponent, played a key role in inspiring Warren's move into politics.  As a presidential candidate, she used it to highlight her differences with Biden. On the day in April 2019 that Biden entered the race, she said at a rally that Biden had been "on the side of the credit companies."  The law, which was heavily backed by the banking and credit card industries, made it harder for Americans to get out of debt by filing for bankruptcy. Supporters of the measure said it would prevent financially irresponsible people from abusing the system, while opponents denounced it, saying it would hurt struggling people by increasing the regulation, documentation and costs of seeking bankruptcy protection. Bankruptcies plummeted after the law took effect, but not for the right reasons, consumer advocates argued. Biden was seen as a leading proponent of the bill at the time, though it was largely backed by Republicans and passed by a GOP-controlled Congress. Biden's campaign has argued he successfully fought for changes to the bill that prioritized child support and alimony in front of lenders and required credit card companies to warn borrowers about their interest rates. The Warren plan targets a series of provisions that she has criticized for years, arguing that they benefit credit card companies and big lenders at the expense of Americans struggling with consumer, household and student debt. Warren's proposal would make the bankruptcy system "simple, cheap, fast, and flexible," she wrote in a Medium post when she unveiled it in January. It would merge the two types of consumer bankruptcy filings -- Chapter 7 and Chapter 13 -- into one, offering filers a "menu of options" for dealing with their unpaid debt. It would eliminate what she termed "burdensome paperwork" that makes bankruptcy more expensive, deterring some from filing. It would reverse the 2005 law's requirement that filers seek pre-filing credit counseling, as well as the additional rules it placed on consumer bankruptcy attorneys. She would also reduce the cost of filing and make it easier for people to keep their homes and cars during bankruptcy. The proposal would make it harder for the wealthy to shield assets in trusts and would crack down on companies that violate consumer financial protection laws while trying to collect on debts. And her proposal would end the ban on shedding student loan debt in bankruptcy. CNN's Gregory Krieg and Tami Luhby contributed to this report.

Below is a letter written by a 64-year old bankruptcy attorney to the United States Trustee, the agency that oversees bankruptcy cases.
Clifford J. White III, Director
Executive Office for U.S. Trustees
Re: Covid-19 and consumer bankruptcy practice
Dear Director White:
On behalf of our NACBA membership and our entire NACBA Board of Directors, I am writing to you to suggest immediate (and hopefully temporary) remedial actions regarding the administration of Ch. 7 and Ch. 13 bankruptcy cases. These suggestions are meant to help stabilize our joint goal to maintain the integrity of the bankruptcy system while we all struggle for equilibrium in these trying times.
All pending 341(a) meeting of creditors in consumer chapter 7, 13 and 11 cases be automatically adjourned for some period of time (such as at least 4 weeks), OR
that debtors and their counsel be permitted to appear telephonically, in place (given quarantine or social distancing, as applicable), by joint conference call or other electronic means, AND
that ‘wet’ signatures (allow for /s/ signatures) be eliminated for those forms and in those jurisdictions where ‘wet’ signatures are required.
We know that you are aware of the heightened risk of serious illness and death for those aged 60 and over if this Covid-19 virus is contracted. While we cannot know exactly the proportions of our Attorneys, Clients nor Trustees who belong to that demographic, speaking for myself as a 64 year old, the risks to us all, at the present time, are clearly too great to ignore. I am sure you will agree that these suggestions, while representing a change from normal case administration, are warranted.
Your prompt response and action along these lines is appreciated.
On behalf of NACBA,
John C. Colwell
President, Board of Directors
National Association of Consumer Bankruptcy Attorneys
Nebraska is leading the way on this issue.  For two years I nagged the court in this blog and in bankruptcy seminars to allow digital signatures of bankruptcy petition, and our court finally agreed that the evidence supported this practice starting in February 2018.  For the past two years the Nebraska bankruptcy court has allowed debtors to sign their case electronically with digital signatures and the program has been a stunning success.  Debtors may review and sign documents through digital signature vendors like DocuSign and receive an immediate copy of what they signed.
In this strange and stressful Covid-19 virus episode, our clients are able to send and sign all required documents to us electronically. Most if not all of the work can be completed over the telephone and email.
Nebraska is the only bankruptcy court allowing digital signatures. And now the rest of the nation is in a panic to allow what our wise court accepted over two years ago.
The next step is to allow debtors to testify at the required trustee meeting over the telephone or via a video conference, such as Skype.  Our Nebraska trustee has already begun testing that service this past year.
Our office is fully ready to protect clients from the spread of the Covid-19 virus with the following service:

1. Telephone or video consultations.
2. Digital signatures of all bankruptcy documents.
3. Documents may be emailed or sent via a ShareFile system.
4. Payments are accepted online on our website, www.SamTurcoLaw.net
5. We have video conferencing services ready to facilitate handling court hearings over the internet.
6. All our staff is able to work from home.
7. We handle cases in all 93 Nebraska counties.

As a result of continuously modernizing our firm, we are 100% ready for this Covid-19 virus.  Imagine that, a little state like Nebraska is the clear leader in solving this national problem, and I am in daily contact with attorneys nationwide who are looking to copy what we implemented two years ago. So much thanks is owed to Judge Thomas Saladino who had the guts to try something new that will soon benefit debtors and attorneys nationally.
 
 

In the last few months, OneMain has been contacting me about reaffirmation negotiation on car loans. That took me by surprise. With the exception of Ford Credit, I’ve been strongly opposed to reaffirming cars.  Usually you can keep the car without reaffirming. and then give it back when your credit improves. I explain more about […]
The post After Bankruptcy, OneMain Offers Car Reaffirmation Negotiation by Robert Weed appeared first on Northern VA Bankruptcy Lawyer Robert Weed - .

Outstanding debt is higher than ever. The Federal Reserve Bank of New York reports that household debt in the United States has now reached its highest-ever total: more than $14 trillion.

Regardless of the debt you’re suffering from, you might not see an end in sight. Is there a chance you can get out of debt without paying?

The answer is maybe, depending on a number of factors. Here are some ways you can explore getting out of debt that don’t include paying it.

How you can get out of debt without paying
Debt might feel homogeneous, but each type is different — so your options will depend on which type you’ve accrued. Before you stop paying, make sure you know the limitations and the long-term ramifications of doing so.

How to get out of student loan debt without paying
There are a few different options for getting out of student loan payments. Your loan, job status and sometimes the school you attended all determine what you’re eligible for.

Income-driven repayment plans: These revise your monthly payment to 10 to 20 percent of your income for the next 20 or 25 years (depending on the plan). After that, the remaining loan balance is forgiven.
Public Service Loan Forgiveness: Available for those who work in the public sector, like employees at the federal, state and local level, and for those who work for a nonprofit organization. After you’ve made 120 qualifying payments while working full time for a qualifying employer, the rest of your Direct Loans will be forgiven.
Teacher Loan Forgiveness: Open to teachers who work five consecutive years at a low-income elementary or secondary school and to those who work at an educational service agency. You might qualify for forgiveness of up to $17,500 of your Direct Loans or Stafford Loans.
Perkins Loan Cancellation: Teachers, firefighters, law enforcement officers and others are eligible for Perkins Loan cancellation or discharge. Cancellation can happen over the course of five years, while discharge could happen in the event of bankruptcy, death or disability.
Closed school discharge: If your school closed while you were attending (or soon after you withdrew), you may qualify to have your federal student loans discharged.
Discharge options: You could get your loans discharged in the event of death, permanent disability or — very rarely — bankruptcy.
For most options, you’ll need to make qualifying, timely payments each month. However, even then, not everyone qualifies or receives forgiveness. For instance, less than 1 percent of Public Service Loan Forgiveness applicants were approved and considered eligible.

You can’t have a defaulted loan forgiven, but defaulted loans may qualify for discharge, depending on the loan and the program.

How to get out of credit card debt without paying
If you have more credit card debt than you can handle, there are a few steps you can take; however, you may want to consider the repercussions.

If you stop paying your credit card bill, it gets turned into collections and your credit score tanks. But there’s a statute of limitations for how long creditors can sue you for outstanding credit card debt, which varies from three to 10 years in most states. You could skip payments, but you might be liable for them later. Even at that point, if you are sued for outstanding payment, you most likely wouldn’t win the case.

Another route is debt settlement, which is when you settle your debt with the current lender (or collection agency, if it’s reached that point) for less than what you owe. You may not be responsible for your entire credit card debt, but you’d still pay some of it.

How to get out of debt through bankruptcy
Bankruptcy should only be considered if you don’t have any other options. Filing for bankruptcy may sound like you’re starting over, but depending on the route you go, you may still be on the hook for some of your outstanding debt.

In a Chapter 7 bankruptcy filing, some of your assets are sold off to pay back debt, meaning you could lose your home and personal property. A few months after filing, your remaining debt will be discharged — although Chapter 7 typically won’t cover things like student loan debt or child support.

In a Chapter 13 filing, you get set up on a court-ordered repayment plan. Any remaining debt after a certain time has passed, like five years, might be discharged. This process means you’ll spend even longer paying off your debt, and you’ll also have a bankruptcy filing on your credit report.

Depending on the type of bankruptcy you file, a bankruptcy filing could stay on your credit report for up to 10 years, which is why it’s important to carefully weigh your options and your outstanding debt. Debt collectors can’t attempt to collect a debt that was discharged in bankruptcy, and they can’t continue collection activity while the bankruptcy case is pending — but the filing itself will have long-term effects on your financial health.

Why not paying off debt doesn’t work
Your credit report is a vital part of your financial well-being. Late or missed payments, defaults, collections and bankruptcies not only crush your credit score, but can also hurt your chances of taking out a loan or getting approved for a credit card.

Not paying your bills also puts you in a dangerous position with lenders. Avoiding payment means that creditors can sue you for unpaid bills. In some states, you could get your wages garnished or have your assets seized. Even if you aren’t making the payments directly, you’re still paying your outstanding debt.

Alternatives to bankruptcy
If you have the chance to avoid bankruptcy, you should take it. Here are some alternatives to consider.

Supplement your income: Whatever you need to do to start paying off your debt, do it now. Ask for a raise at work or move to a higher-paying job, if you can. Get a side-hustle. Start to sell valuable things, like furniture or expensive jewelry, to cover the outstanding debt.
Ask for assistance: Contact your lenders and creditors and ask about lowering your monthly payment, interest rate or both. For student loans, you might qualify for temporary relief with forbearance or deferment. For other types of debt, see what your lender or credit card issuer offers for hardship assistance. If you have the means, see if friends and family will help you.
Take out a debt consolidation loan: If you have many different types of debt, look into consolidation options. Taking out a debt consolidation loan is a way to simplify your finances — putting all of your debt in one place — and potentially pay less interest in the long run.
Get professional help: Reach out to a nonprofit credit counseling agency that can set up a debt management plan. You’ll pay the agency a set amount every month that goes toward each of your debts. The agency works to negotiate a lower bill or interest rate on your behalf and, in some cases, can get your debt canceled.
The bottom line
It can feel like it’ll take a lifetime to get out of a huge debt trap. You may skip payments, consider not paying at all or file for bankruptcy. While you might, in certain circumstances, get out of paying your outstanding debt, the likelihood is low. And more often than not, it’s harmful to your financial well-being to avoid paying your outstanding debt.