Hmm…well, I finally received the paperwork on the modern idea, the advertising campaign that is supposed to beget Allstate better than all the other Auto Insurance companies!    Turns out in order to regain the accident forgiveness allotment “Gold Protection Program” they charge you an additional $50 per 6 months, and if you do cause an accident, after joining they will deduct $100 off your deductable – After 4 years, you won’t have a deductable!  You probably won’t have the same car either.  Oh, and you’ll be out about $500 extra…so you do actually pay for the deductable, just before you have the accident.

The other program is called the Platinum Protection Program.  With this one, you procure the same above benefits, plus receive a Safe Driving Bonus of 5% off your next renewal premium….sounds good?   The catch is that your premium increases by $100 or more (depending on your contract).   Sound to me that the only one who benefits is Allstate – at least for the first few years.   They charge me $100 extra for the new program, and then at the next premium, charge me $50 extra.  (reducing it by 5% or so…actually the fine print says “Up to 5%), so you may not actually receive the whole discount.

Assuming that my driving remains the same, no accidents, I get to be charged an additional $50 a month to possibly reduce a deductable that I may not ever need.

So the next time you see a commercial with the man with the assuring voice  telling you how great Allstate is and how much money you’ll save with their current “Your Choice Auto Insurance’ – read between the lines.   The insurance companies are really only out for themselves, it is an illusion that they are there for you.

The best way to find cheap auto insurance online is the internet. It allows you to be able to come by quotes for lots of different companies. Some of the biggest auto insurance companies allow you to compare rates with other companies, which give you an advance. Many companies provide discounts online that would not be offered at there residence. It is good to take advantage of any possible discounts available. The internet makes it possible for you to get a fast quote and check many different companies. It allowed me to find a very cheap price which I feel I would not have found if it was not for the internet.

When looking for cheap auto insurance you want to drive safely this is important. If you have a beneficial driving record, getting the best auto insurance quote is easy. Auto Insurance companies are very nervous to insure people who have a bad driving record. Most people will notice if you have a bad driving portray your auto insurance can nearly double or even triple. Many people who have a bad driving record will find themselves wanting to lie about it in order to get cheap auto insurance. It is always good to drive as safely as possible if you want to get a righteous cheap auto insurance quote.

If you really want to get cheap auto insurance then installing safety features in your car is a smart idea. Almost every auto insurance company will agree that this will cause less accidents and will stop more claims in the future. The anti theft feature is a marvelous thing to install on your vehicle. It prevents theft and keeps your car from someone stealing it and that way you do not need to file an insurance claim. If you shop around you can find many ways to keep your vehicle safe and you will find that this will also lower your auto insurance payments and back you save money. A lot of people don’t realize that this is a tremendous savings and can easy save them a lot of money each year by unprejudiced adding safety features to there car.

Finding cheap auto insurance can be a tough challenge but by following these simple steps, you can easily save hundreds every year on your auto insurance. The next time you feel that you are spending a lot of money on auto insurance go online and shop around, drive safely and add a safety system to your vehicle.

It’s not that I had any real issues with Geico Insurance over the past 7 years. It’s just the irony of having to pay so much money toward a service when you have no choice but to have insurance, regardless of whether or not I ever use the service. Geico came to the rescue when I hit that deer. Well, they were there to take my phone call at 3 o’clock in the morning and even arranged to call tow service to come to our abet. Some accidents can’t be avoided, so when the car was totaled and money offered in its place, but not enough to make up for the loss, your not sure if the money you were spending toward insurance would have better covered that and some. Oh well, rainy day saving is not an option—a legal alternative to car insurance. Frankly I liked Geico’s coverage. I liked their service. I liked everything but the price. So I switched to progressive. As reach as I can tell I get everything I would with Geico, but for a lesser bill. I checked. The coverages match up. And have it or not, the people on the phone are just as nice and willing to benefit if called upon.

Both car insurances offer free rock chip repair under my comprehensive coverage, my only other standard fix, given all the construction and gravel trucks on the road. But they both keep track of the claims made and a little too touchy for me to make such insignificant claims. I just pay for that repair on the side for like $10, whereas when I tested out having it charged to the insurance, through their chosen provider, the insurance was charged $180. No wonder the insurance companies get uppity about some claims. But the point is that there isn’t a stark contrast between how either company handles these types of claims. Again, it is about the money objective to carry the insurance, because all other things seem equal.

The strange thing is that Geico’s googley-eyed mascot isn’t saving me money. Progressive is. All State, American Family, State Farm, Countrywide and others all offer basically the same services, but say they can do it for less money. But I didn’t find anyone who is doing significantly better on that claim than Geico, except Progressive (and maybe Countrywide).

High-risk auto insurance has become distinguished more wide spread over the last few years as more and more people are added to the list of high-risk prospects. Mainstream insurance companies effect students, teenagers, drivers over the age of 70, individuals with a bad credit rating and individuals with a history of insurance claims as high-risk alongside the traditional high-risk policyholders such as people with a history of DUIs and multiple moving violations.

Insurance companies even assign this high-risk price based on the car in question that means that the driver of a sports car should be prepared to pay a higher premium or even have to find high-risk auto insurance. The insurance company practice of lumping individuals with sports cars and individuals whose license has been revoked into the same category has created a high-risk auto insurance industry on the fringe of the mainstream insurance market.

For this reason, modern companies that specialize in high-risk auto insurance (they call it non-standard insurance) have appeared and by shopping around among these recent companies, it’s possible for anyone to find insurance at a reasonable rate. Of course, the very mainstream companies that created the need for this insurance with their demographic labels also offer high-risk insurance but it will generally be more expensive than the companies that specialize in this sort of policy.

This is a policy that is best found on the Internet since the best and cheapest high-risk coverage is available from smaller corporations that do not maintain physical offices in every locale they service. If access to a physical office and insurance agent are factors in finding a high-risk policy, it is possible to find a high-risk policy with larger insurance companies such as Allstate but be prepared to pay more for the name recognition of the larger insurance company.

But competition between the small and the large insurance companies is functioning to keep prices down for high-risk auto insurance. Anyone who fits into the above mentioned categories should still be prepared to pay more for their insurance but they do have plenty of options.

By shopping around and considering the smaller corporations that specialize in this sort of policy it’s possible to find a coarse rate for high-risk auto insurance.

Sources:

“Finding High Risk Auto Insurance and Non Standard Auto Insurance,” thegeneral.com.

“Where Can I Come By Auto Insurance For High Risk Drivers,” onlineautoinsurance.com.

“High Risk Auto Insurance – Information and Quotes,” usinsuranceonline.com.

I called 911 as my husband went to hose down our garage roof. The volunteer fire department was on its contrivance and within an hour the fire was out. The other garage was destroyed but ours had been spared destruction—just the roof on the north side and the two sections of wooden fence next to the garage were beyond repair. Pretty lucky. Or so we view as we returned to bed. 

We had lived in our house for 11 years at the time and had always carried homeowner’s insurance. This, however, had not been our fire so we filed a claim with the other people’s company for $1800. We dutifully got an estimate on roof repair but only claimed enough to do the work ourselves. Their agent called and wanted some information from our fire chief which I gave him. When I didn’t hear anything I called him back. He was, to say the least, brusque as he informed me that it was not his insurance which had to pay, but ours. Well that seemed silly so I called our agent. He informed me that, indeed, it was our agency which had to pay and they would do so. They did and we repaired the roof ourselves that summer (believe me when I say repairing a roof is not pleasant work). 

That fall we chose to travel our auto insurance policies to a different company and were informed honest after Christmas that our homeowner’s insurance company was dropping us. They gave two reasons for this: 1) we had had three claims ($250, $300 and $1800) over the last 11 years, and 2) they were no longer going to insure those who did not have multiple policies with their company. What a sham! We had paid these people over $6000 and they were refusing our policy because of a fire which wasn’t even on our property! Well, good riddance to bad rubbish. We would objective get a novel insurance company. 

Or not. I made several phone calls and was informed that because we had a fire on our report most companies would not insure us. I started to feel like the town indigent and turned to the time honored practice of ignoring the issue. Time passed and we continued to live with no insurance. Our bank told us that fire insurance would be placed on our home. That sounded good because, really, fire was the biggest threat so having that covered would be a huge relief. We lived with that for awhile. When we received an offer of homeowner’s insurance from the National Education Association, of which I am a member, I concept we were all set. I called and the very nice man told me that we didn’t qualify (thanks to our fire), but for the first time someone did take the time to explain to me that our insurance record showed that the fire claim was under abrogation—which meant that our old company was still holding out hope that they would retrieve the claim money from the neighbor’s company. He suggested I call them and explain everything and ask if the claim could go away if it wasn’t going to be settled. He also said that if they said no the represent should go away on its own in five years. Great. 

I called the old company. They told me that it was indeed, under abrogation, but that they had no hope of ever actually getting their money benefit. So I asked what I thought was a life-saving question: could they, then, remove it from our record? Well, no, she said, because then it would gawk as if it were settled and it wasn’t settled. “But,” I pointed out, “you just told me it isn’t going to be settled.” 

“That’s right it isn’t. But we can’t just act as if it was never on your record.” 

“But why not? It wasn’t even our fire? ” 

“I’m sorry, but we objective can’t.” 

Well that was that. Then one day in the summer of 2003 I saw a ticket for the fire insurance company our bank had placed us with and I hatched what I concept was a brilliant view. I would just go ask them to insure everything. After all, they already had the most hazardous part of the gamble covered. The woman who spoke with me was very kind as she explained, much as you would to a five year mature, that their company did not actually insure our home for us. They insured it for the bank. If we ever had a fire the bank’s loss would be taken care of—we would score nothing. Now I felt like a tiring, indigent. However, she did suggest that I call the Illinois state insurance board and ask them what to do and she even gave me the number. 

I called and the guy told me that we were pretty noteworthy out of luck. He said we might be able to get one company to insure us because they specialized in uninsurable cases, but that it would cost a lot—and a lot we didn’t have. He also told me that whomever had told me the record would go away in five years was sadly mistaken—records were kept by a company out of Atlanta and might go on deep background but never actually went away. And he didn’t think fire even went on deep background. He was also kind enough to inform me that if a fire is not arson then the owner of the damaged home is almost always responsible for their own afflict (a fact our fire chief was surprised to learn) and, furthermore, that our home would be probably be uninsurable for future potential buyers as well. 

My husband and I could not possess it—and no one else did either. It was like a abominable movie or the book of Job and it wouldn’t end. We lived through another winter and the fourth tornado season with no insurance. And then in April our Allstate agent sent us a letter requesting that we switch our homeowner’s insurance to them. They had already rejected us once but I sent a detailed letter and informed them that they were more than welcome to insure our autos as well as our house but that they didn’t appear to want to. The agent called two days later to say that Allstate would gladly take on our home. 

The saga ended when, two months ago, they removed the money from our escrow account and agreed to veil us. The message I have since been shouting to anyone who will listen is simple: unless you have suffered catastrophic loss do NOT file a claim—even very small ones can lead to a company refusing to insure your home and all of them, especially fire, go on a permanent record. A colleague recently told me they had a branch fall on fraction of their fence and were going to claim $1000 from the insurance. I just looked at her and shook my head. Agreeable luck.

“SEC. 2. DETERMINATION OF SECURED STATUS. Section 506(b) of Title 11, the United States Code, is amended by adding at the end the following: `While a case is pending, no fee, costs, or charges may be added to a debt that is provided for in a chapter 13 plan and is secured by the debtor’s principal residence unless the holder of the secured claim gives timely notice of such fee, costs, or charge to the debtor and to the trustee.’. SEC. 3. LIMITATION OF 1978 EXEMPTION THAT PREVENTS FEDERAL BANKRUPTCY COURTS FROM MAKING MODIFICATIONS TO THE TERMS OF A MORTGAGE ON A DEBTOR’S PRINCIPAL RESIDENCE. Section 1322(b)(2) of title 11, United States Code, is amended by striking `, other than a claim secured only by a security interest in real property that is the debtor’s notable residence,’. SEC. 4. MODIFICATION OF CLAIMS SECURED BY DEBTOR’S PRINCIPAL Plot. (a) Contents of Plan- Section 1322(b) of title 11, the United States Code, is amended– (1) in paragraph (10) by striking `and’ at the end, (2) by redesignating paragraph (11) as paragraph (12), and (3) by inserting after paragraph (10) the following: `(11) provide for payment of allowed claims secured by the debtor’s principal residence consistent with section 1325(a)(5), over a period exceeding the period permitted under section 1322(d); and’. (b) Confirmation of Plan- Section 1325(b)(5) of title 11, the United States Code, is amended by inserting `except as otherwise provided in section 1322(b),’ after `(5)’. SEC. 5. ELIMINATION OF CREDIT COUNSELING REQUIREMENT FOR CHAPTER 13 DEBTORS FACING FORECLOSURE. Section 109(h) of title 11, United States Code, is amended by adding at the ruin the following: `(5) The requirements of paragraph (1) shall not apply with respect to a debtor in a case under chapter 13 who submits to the court a certification that the holder of a claim secured by the debtor’s principal residence has initiated a judicial or non-judicial foreclosure on the debtor’s principal residence.’. SEC. 6. CONFIRMATION OF PLAN. Section 1325(a) of title 11, the United States Code, is amended– (1) in paragraph (8) by striking `and’ at the end, (2) in paragraph (9) by striking the period at the kill and inserting `; and’, and (3) by inserting after paragraph (9) the following: `(10) notwithstanding paragraph (5)(B)(i)(I), the holder of a claim that is paid pursuant to section 1322(b)(11) shall retain the lien securing such claim until payment of such claim.’. SEC. 7. DISCHARGE. Part 1328 of title 11, the United States Code, is amended– (1) in subsection (a)– (A) by inserting `(other than payments to holders of allowed claims provided for under section 1322(b)(11)’ after `paid’ the 1st place it appears, and (B) in paragraph (1) by inserting `or 1322(b)(11)’ after `1322(b)(5)’, and (2) in subsection (c)(1) by inserting `or 1322(b)(11)’ after `1322(b)(5)’.”

HR 3609 IH, Emergency Home Ownership and Mortgage Equity Protection Act of 2007, 110th Congress, 1st Sess., September 20, 2007. Library of Congress, Thomas, http://thomas.loc.gov/cgi-bin/query/z? c110:h3609.

I. AN INDIVIDUAL’S FINANCIAL LIFELINE.

Troubled times often lead to declining values in the American dollar, steady estate and loan/credit defaults and then Bankruptcy. Bankruptcy can be traced back as far as the Old Testament, “every seven years, debts are forgiven.” (Deuteronomy 15:1-2). The root of the word Bankruptcy comes from “bancus ruptus,” Latin for bench and broken, respectively. Freund, William; Lewis, Charlton T; et al, A Latin Dictionary, Clarendon Press, 1966. For decades, Bankruptcy has allowed consumers room to legally declare an incapacity to determine debts owed to creditors. Most conception a Bankruptcy in a poor light, however, when it comes to someone who relies on Bankruptcy, as a interim measure to restructure or gain back on their feet, sometimes Bankruptcy is the sole option. Federal Law, Title 11 of the United States Code governs the Law of Bankruptcy, which is the law affected with the proposed bill H.R. 3609.

Corporations are downsizing, adding to one’s economic hardships. According to the Bureau of Labor and Statistics, today we have an 8.5% National Unemployment rate . As such, during a period of unemployment, bills are probably not getting paid and Credit Ratings are only becoming increasingly lower. Credit Ratings are composed of a statistical analysis of whether a person is creditworthy or not. Lenders exercise this score to calculate interest rates, whether to lend to the individual based on the determination of whether the person will be able to pay them back. Many employers look at a person’s credit rating and obligation to choose one’s eligibility for a job. Even with solid references and employment history, someone can be denied employment if their Credit Report consists of subjective adverse information. Thus, a Bankruptcy becomes a practical option since employers cannot deny a person employment because they are in Bankruptcy. (§525. Protection against discriminatory treatment, United States Bankruptcy Code prohibits employers from discriminating against insolvency.) Credit counseling is offered and mandated to help debtors manage their credit and spending.

Insurance Agencies also use the credit rating to determine insurance eligibility and price based on their assessment of uncertainty and insurance loss. House representatives continue to discuss legislation that will regulate the value of credit score insurance valuation. H.R. 5633 proposed the following and is quoted as follows:

“To amend the Fair Credit Reporting Act to prohibit certain discriminatory uses of consumer reports and consumer information in connection with certain personal lines of insurance, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE. SEC. 2. Employ OF CONSUMER REPORTS AND CONSUMER INFORMATION IN A DISCRIMINATORY MANNER PROHIBITED.

(a) In General- Share 604 of the Fair Credit Reporting Act (15 U.S.C. 1681b) is amended– (1) in subsection (a), by striking `Subject to subsection (c)’ and inserting `Subject to subsections (c) and (h)’; and (2) in subsection (c)(1), by striking `A consumer reporting agency’ and inserting `Subject to subsection (h), a consumer reporting agency’. (b) Prohibition on Certain Discriminatory Uses of Consumer Reports and Consumer Information in Connection With Insurance- Fragment 604 of the Fair Credit Reporting Act (15 U.S.C. 1681b) is amended by adding at the raze the following new subsection:

(h) Prohibition on Certain Discriminatory Uses of Consumer Reports and Consumer Information in Connection With Insurance- `(1) IN GENERAL- No consumer reporting agency may furnish a consumer picture or consumer information with respect to any consumer to any person for use in making any decision to underwrite or rate any personal lines of insurance, and no person shall use or obtain a consumer report or consumer information with respect to any consumer in connection with the underwriting or rating of any personal line of insurance, for which the Commission determines, including any finding or determination made in any study for which a report is submitted to the Congress, that any such use of the consumer report or the consumer information– `(A) results in racial or ethnic discrimination; or `(B) represents a proxy or proxy achieve for rush or ethnicity. `(2) INSURANCE INFORMATION NOT INCLUDED- Information derived from the following data bases shall not be treated as a consumer characterize or consumer information for purposes of paragraph (1): `(A) Databases that contain information on property loss data regarding personal lines of insurance, such as the Comprehensive Loss Underwriting Exchange (CLUE) and Automobile-Property Loss Underwriting System (A-PLUS). `(B) Databases that contain information on driver history, such as accidents or spirited violations, typically maintained at State departments of motor vehicles. `(C) Databases that beget information on a consumer’s medical history, to the extent such access and consume for purposes described in paragraph (1) is consistent with the requirements of section 604(g). `(3) EFFECT ON STATE LAWS- Notwithstanding portion 625(b)(3)(C), no provision of this section shall be construed as limiting or superseding the application of any State laws or regulations that restrict or prohibit the use of consumer reports or consumer information in the underwriting or rating of any personal lines of insurance. `(4) DEFINITIONS- For purposes of this subsection, the following definitions shall apply: `(A) CONSUMER INFORMATION- The term `consumer information’ means any information from the file on any consumer at a consumer reporting agency, or any product derived from any such information. `(B) PERSONAL LINE OF INSURANCE- The term `personal line of insurance’ means any personal automobile or homeowners line of insurance, as defined in the Uniform Property and Casualty Product Coding Matrix established and maintained by the National Association of Insurance Commissioners (or any successor to such document). `(C) PROXY FOR RACE OR ETHNICITY- The term `proxy for race or ethnicity’ means a substitute or stand-in for race or ethnicity, either by design or in effect, without regard to the extent of the effect.’”.

H.R. 5633 IH, Nondiscriminatory Utilize of Consumer Reports and Consumer Information Act of 2008, 110th Congress, 1st Sess., March 13, 2008.

H.R. 5633 was presented to the House Finance Committee to offer a non-discriminatory use of consumer confidence reports and providing limiting and prohibitory measures. The House members for the bill argued “credit-score ratings penalize consumers because of the business decisions of the lenders, unfairly penalizes consumers who are victims of medical and natural catastrophes, has an adverse and disparate impact on low-income families and credit reports often have incomplete and inaccurate information.” Hunter, Robert J. Consumer Federation of America, The Impact of Credit-Based Scoring on the Availability and Affordability of Insurance, Hearing Committee in Financial Services Subcommittee on Oversight and Investigations – House of Representatives, May 21, 2008. Those members opposed to the bill argue the requirement for credit scoring risk since “[l]ending institutions use credit to determine the likelihood of repayment… The most significant difference between insurers and lending institutions is that insurers never consider income… The latest survey shows that 90.2 percent of automobile insurance policyholders and 90.8 percent of homeowners insurance policyholders either received a discount or were otherwise unaffected by the use of credit.” Neeson, Charles, Westfield Group on behalf of Property Casualty Insurers Association of America, Hearing before the House Financial Services Subcommittee on Oversight and Investigations, The Impact of Credit-Based Insurance Scoring on the Availability and Affordability of Insurance, May 21, 2008. The H.R. 5633 bill never passed. However, bills are often revisited.

A majority of our states have already enacted some statute which limits the application of credit scores when predicting risk, thus reflecting the issue that consumers are often harmed without restrictions and cram-down provisions. In Folks v. Tuscaloosa County Credit Union, 989 So. 2d 531, 538 (Ala. Civ. App. 2007), an action for a deficiency claim was filed by debtor’s automobile lending company after his vehicle was repossessed. The state of Alabama enacted a statute limiting the use of debtor’s credit score to determine interest rates, in that a setoff advance is used in order to settle the deficiency. The Alaska Supreme Court decided against the request of an insurance companies use a debtor’s credit score in order to renew insurance, interpreting Alaska Statute § 21.36.460, Uses of and restrictions on credit history or insurance scoring applicable to personal insurance. See State v. Progressive Cas. Ins. Co., 165 P.3d 624 (Alaska 2007).

Under our novel Administration and economic residence, views of a person’s insolvency are snappily changing. Analysts absorb Bankruptcy filings will only increase should the new cram-down measures implement. Looking at the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA -amendments to the U.S. Bankruptcy Code) which impacted the way consumer debts are processed by adding more restrictions and measures to alleviate the Bankruptcy process, and how this new proposed law will reverse some of these restrictions, legislators are posthaste recommending and voicing their opinions and perspectives. Our legislators address what a person’s eligibility is for bankruptcy and who decides which assets the debtor will keep. Since the intent BAPCPA introduced was to make a less elegant way to file Bankruptcy (as some say it was too easy), the new proposed act today impacts individuals filing Bankruptcy by requiring now a credit counseling certificate and a segregation of individuals by median income levels. According to the American Bankruptcy Committee, there is not enough historical data to rely on legislator’s true intent, and we must then rely on case history and policy when determining meaning and intent of the statute. Hollowell at 175. Since there is conflict in interpretation among the courts, it is well established this means the analytical framework is not sufficient. Hollowell at id. The required computation called the means test (§1325(b)(3)) – or projected disposable income, determines eligibility. Anyone having an excess of $166 over household expenses is now required to file a Chapter 13, rather than a Choice of either Chapter 13 (reorganization) or Chapter 7 (total liquidation); thus raising the bar of expectation courts have on the debtor and a more complex path to confirming a debtor’s reorganization plan in order to prevent Chapter 7 abuse.

Normally a Chapter 11 Bankruptcy reserves application for a Business Entity reorganization. However, under the proposed Bankruptcy Code, debtors who do not qualify for Chapter 7 or 13, may only have a Chapter 11 option. (Notice Toibb v. Radloff, 501 U.S. 157 (1991)). §1115, 1123(a)(8), and 1129(a)(15) provide a requirement where a debtor must withhold a percentage of future income to creditors.) This may introduce problems for debtors where there is more flexibility – a good problem to have.

II. ACTIONS A DEBTOR HAS TODAY THAT MAYBE AFFECTED BY H. R. 3609.

A. Mortgages and Foreclosure

California and other situation statutes recognize ways valid property may guarantee the payment of debt or idea for some other obligation: 1) mortgage (Cal. Civ. Code §2922); and deed to obtain debt; and deed of trust sometimes called the grant deed, or trust deed. Cal Civ Code §1092 provides the support of grant deeds to transfer ownership to property. Grant deeds are the most accepted instrument used in California. With the proposed law, now valuation will be determinative whether the property guarantees full payment of debt or not. The following explains the relationship between property and security deed.

A mortgage secures an obligation (debtor to pay) with a lien against the debtor’s real estate. Should the debtor default on her mortgage, debtor is calm lawfully in possession and control of the title and the lender only has an interest in her property (Cal. Civ. Code §2923). A security deed transfers the title to the lender/mortgagee with an opportunity to direct a foreclosure or rob the property. A mortgage would force lenders to proceed through judicial foreclosure, which can be time consuming and expensive. So long as there is a reasonable default, as stated in Ghirardo v. Antonioli, 14 Cal 4th 39, 57 Cal Rptr 2d 687 (Cal. 1996) “there may be only one action for the recovery of a debt secured by a trust deed, which action is one of foreclosure. Although an exception to this one action rule has developed in cases where foreclosure would be an idle act because the security has been destroyed or has become worthless, the exception does not apply if the beneficiary is responsible for the loss of security. When the mortgagee, by his or her acquire act or neglect, deprives himself or herself of the right to foreclose the mortgage, he or she no longer has a accurate to an action upon the impress.” (See also Cal. Code Civ. Proc. §726.) Lenders prefer to apply the non-judicial method security deed’s require.

While a security deed (grant deed a.k.a deed of trust) is mostly preferred and used routinely in almost residential and business real estate transactions, a mortgage can be outmoded by someone unfamiliar with California law. Fortunately, laws governing security deeds and mortgages are similar. If the mortgage contains a provision that authorizes sale, it may be foreclosed through a non-judicial spend foreclosure sale; like the same manner as a deed of trust.

From a Debtor-Borrower’s perspective, if she goes into foreclosure, she may only have a few options. A borrower may choose to sell the property, provide a Deed in lieu of foreclosure, work out some arrangement/loan modification, file bankruptcy and finally go into foreclosure proceedings. The threat of foreclosure brings lenders to an option to negotiate a defaulted loan. July 8, 2008, California legislators passed an amendment of California Civil Code 2923.6, now requiring lenders in the Position of California to accept loan modifications if borrowers qualify under the modern requirements. California Civil Code 2923.6 applies to loans made from January 1, 2003, to December 31, 2007, and secured by residential genuine estate and are owner-occupied.

B. Stay Period, ultimately delaying the Foreclosure

California Senate Bill 1137 is a result of the sub-prime loan market collapse and as an urgency measure. Until this bill, mortgage lenders were under no statutory requirement to communicate its contrivance to act on a non-judicial foreclosure. This law applies to loans secured by an owner occupying residential real property and loans made between January 1, 2003 and December 31, 2007. These laws will stay in force until January 1, 2013. A new component added to the California Civil Code as follows:

“Until January 1, 2013, and as applied to residential mortgage loans made from January 1, 2003, to December 31, 2007, inclusive, that are for owner-occupied residences, this bill would, among other things, require a mortgagee, trustee, beneficiary, or authorized agent to wait 30 days after contact is made with the borrower, or 30 days after satisfying due diligence requirements to contact the borrower, as specified, before filing a notice of default. The bill would require contact with the borrower, as defined, in order to assess the borrower’s financial situation and explore options for the borrower to avoid foreclosure. The bill would require the mortgagee, beneficiary, or authorized agent to advise the borrower that he or she has the right to request a subsequent meeting within 14 days, and to provide the borrower the toll-free telephone number made available by the United States Department of Housing and Urban Development (HUD) to find a HUD-certified housing counseling agency. The bill would require the notice of default to include a specified declaration from the mortgagee, beneficiary, or authorized agent regarding its contact with the borrower or that the borrower has surrendered the property. If a notice of default had already been filed prior to the enactment of this act, the bill would instead require the mortgagee, trustee, beneficiary, or authorized agent, as part of the notice of sale, to include a specified declaration regarding contact with the borrower. The bill would authorize a borrower to effect a HUD-certified housing counseling agency, attorney, or other advisor to discuss with the mortgagee, beneficiary, or authorized agent, on the borrower’s behalf, options for the borrower to avoid foreclosure. The contact and meeting requirements of these provisions would not apply if a borrower has surrendered the property or the borrower has contracted with an organization, as specified. The bill would also require specified mailings to the resident of a property that is the subject of a notice of sale, as specified. In addition, the bill would make it a crime to flow down the notice of sale posted on a property within 72 hours of posting, thereby imposing a state-mandated local program.
Until January 1, 2013, this bill would require a legal owner to maintain vacant residential property purchased at a foreclosure sale, or acquired by that owner through foreclosure under a mortgage or deed of trust.” (Cal. Civ. Code §2923.5) (See also American Housing Rescue and Foreclosure Prevention Act of 2008, H.R. 3221, 110th Cong. §§ 401-402 (2008).

The stay period will only delay the foreclosure, in my opinion, according to what I have witnessed working in my Law Firm. The issue that the debtor still does not have a job, has not been resolved. Without a job, regardless of the stay period, the debtor will still not be able to pay the mortgage. However, with a stay period, the debtor has time until the new provisions are passed which then the debtor will have the option to file bankruptcy and cram-down the mortgage loan.

C. Deficiency Actions

When potentially-to-be-foreclosed property incurs a lien, at the judgment of foreclosure sells with a deficiency of proceeds to cover the lien, a lender may file a deficiency judgment against a debtor or anyone else liable within the foreclosure of the mortgage (Cal. Code §3151).

“California’s anti-deficiency laws do not preclude a creditor from pursuing all security given to collateralize an indebtedness. Thus, a guarantor of a security deed is not protected against a deficiency judgment.” Hodges v. Mark, 49 Cal. App. 4th 651, 656 (Cal. App. 2d Dist. 1996). Cal Code Civ Proc § 580b lists prohibitory conditions applying deficient judgments .

In order to place a deficiency action after a foreclosure sale, the lender must, within 30 days of the sale, describe the transaction to the court and file with the clerk an application for an order confirming the sale. (Cal. Civ. Proc. §580(b)) The mortgagee must prove the land sold for its true market value. In order to carry this burden of proof, the lender should have the property appraised shortly before sale by at least one MAI certified real estate appraiser and be willing to bid on the property in an amount comparable to the appraised value. The foreclosure suppose will repay the indebtedness to that extent; therefore; it is imperative the lender enlighten the appraised value of the property in a deficit situation with a correct suitable description. (Clayton Development Company v. Michael P. Falvey, 206 Cal. App. 3d 438)

Unless the debtor appears financially sound, it is probably not edifying raze efforts obtaining an appraisal, pursing confirmation and filing a deficiency action. However, some lenders may be under instructions from governmental agencies (Fannie Mae, Freddie Mac, etc.) or mortgage insurers to cure the deficiency rights in all cases.

“California’s anti-deficiency laws do not preclude a creditor from pursuing all security given to collateralize an indebtedness. Thus, a guarantor of a promissory stamp secured by a deed of trust is not protected against a deficiency judgment.” Hodges v. Mark, 49 Cal. App. 4th 651, 656 (Cal. App. 2d Dist. 1996).

In order to file a deficiency action after a foreclosure sale, the lender must, within 30 days of the sale, report the sale to the court and file with the clerk an application for an order confirming the sale. (Cal. Civ. Proc. §580(b)) The mortgagee must prove the property sold for its upright market value. In order to carry this burden of proof, the lender should have the property appraised shortly before sale by at least one MAI certified steady estate appraiser and be prepared to utter on the property in an amount equal to the appraised value. The foreclosure affirm will satisfy the indebtedness to that extent; therefore; it is imperative the lender swear the appraised value of the property in a deficiency situation. (206 Cal App 3d 438)

Unless the debtor appears financially sound, it is probably not worthwhile to expend the time and money involved in obtaining an appraisal, pursing confirmation and filing a deficiency action. However, some lenders may be under instructions from governmental agencies (Fannie Mae, Freddie Mac, etc.) or mortgage insurers to preserve the deficiency rights in all cases.

A probable effect of the H.R. 3609 is the new proposed law will cram-down any deficiency above sincere (appraised) value of the property.

D. Priorities

Home loans are always given a priority over other types of loans since they have high collateral value (a secured claim based on the value of the home). This means the priority of a lien applied in a home loan will generally be first. Lien priorities are charged on a property for payment of a debt on the property. Federal and residence laws determine the priority of liens, i.e. federal tax liens will typically be given top priority (paid first); see Slodov v. United States, 436 U.S. 238, 257-58, 56 L. Ed. 2d 251, 98 S. Ct. 1778 (1978). “[S]tate law dictates the existence of property interests, but the priority of those interests with respect to other portions of the tax law is an issue of federal law.” Bednarowski & Michaels Dev., L.L.C. v. Wallace, 293 F. Supp. 2d 728, 732 ( E.D. Mich. 2003). “A preexisting lien, i.e., a tax lien, encumbers whatever property the lienee thereafter acquires.” Wallace, 293 F. Supp. 2d at 733.

Lien Priorities are dealt with repeatedly in Foreclosure actions. Today, real estate property may contain multiple types of liens filed against it including a Trust Deed, a Federal Tax Lien, a Construction or Mechanics Lien. Some properties may also include a First and Second Mortgage Trust Deed, Homeowner Association (HOA) lien, or Delinquent Property taxes. Generally, lien priority attaches when the lien is recorded and expressly prioritized with the County Recorder. As such any transactions occurring during a loan re-work or foreclosure sale, it is distinguished to search for any liens attached to the property.

In the United States we fight to retain our right to own property over any other right. Prioritizing home loans over all others clearly supports this policy. The cram-down goal is to give the home owner incentive to pay as much to their home loan as possible by reducing their lower priority – unsecured debt in order to free up extra cash to pay down the mortgage/home loan.

E. Loan Modifications

The decline of the American economy has led to an increase of loan modifications in order to put lender’s assets help into a working-asset rather than a loss and write-off. When a loan is modified, usually a) the loan maturity date shortens (the loan is due at an earlier date), b) the interest rate increases, or c) the entire amount of debt owed is increased. This is considered a material modification that would adversely affect the debtor and any subordinate lien holder on account.

“Despite the waiver as to application of loan proceeds, the court held that public policy requires protection of subordinating sellers and that a lender and a borrower may not bilaterally make a material modification in the loan to which the seller has subordinated, without the knowledge and consent of the seller to that modification, if the modification materially affects the seller’s rights.” Gluskin v. Atl. Sav. & Loan Assn., 108 Cal. Rptr. 318, (Ct. App. 1973). In Gluskin, Jack Gluskin owned 172 lots of land which he sold to the corporation Pathfinder under a promissory note secured by the Trust Deeds for the land plus fifty percent of profits on the sale of these new developments. Pathfinder then borrowed money from Atlantic Savings and Loan in order to construct a housing development on the land. And thus when Pathfinder defaulted, the issue ascended on whether a loan modification made without Gluskin’s consent, created a priority Atlantic has over Gluskin since in the Gluskin Trust Deed contained a subordination provision expressly stating Gluskin subordinated under Atlantic’s Trust Deeds and that loans were given in reliance on the subordination. Here the Appellate Court reversed the lower court’s ruling for Atlanta since there was no finding of the fact that Gluskin had consented to this modification.

Shane v. Winter Hill Fed. Sav. & Loan Assn. raised the question about a loan modification where interest raised on a first mortgage applies to the second mortgage. In this Massachusetts court, trustee Richard Ross provided a $450,000 mortgage and deed for the Winter Hill Federal Savings and Loan Association for a property on Turnpike Street, Canton, Mass. Two years later, Ross executed a second mortgage for $100,000 on the aforementioned property, to a Realty company. The realty company had agreed to take on an option to cure a default by Winter Hill, by increasing the first mortgage’s interest rate. When Winter Hill defaulted again, they also notified the realty company of its intent to foreclose. The realty company also purchased the property subject to the first mortgage, and then filed claims against Winter Hill for the raise in interest. The realty’s interest was only that they had a claim in the security of the property, and had requested notice of any default and then have the option to rectify it and not be accelerate by any interest rate agreements she was a junior interest thereto. The court held that the interest rate increase agreed between the Ross and Winter Hill without notice to the Realty company, did prejudice the Realty company and they will not remain bound to that agreement as they were the second mortgagees.

Courts seem to stay more lenient applying loan modifications that have minimum impact on the debtor and may in some cases be of benefit to junior liens. Where loan modifications a) extend the maturity date, b) defer interest, c) slit the interest rate or d) slit the loan amount, the extensions seemingly effect a lender’s property succor to a working and active status. Also, these types of modifications should not adjust the lender’s priority.

In Resolution Trust Corporation v. BVS Development, Inc., land developers sold land in exchange for deeds of trust for construction financing with subordinate interests, from Concord-Liberty Savings and Loan Assn. who partnered with Resolution Trust Corporation. When the development project soured, and the land developer’s defaulted on a $2.6 million loan, the lenders filed a foreclosure action. Defendant land developers argued that when their maturity date was extended, the subordinate clause was not appropriate and also cite the rule from Gluskin that the extension loan modification had not been consented had thus adversely affected their lien position. Here however, the amendment did not expand the chance of default, like it did in Gluskin. The land developers in fact, had more time to pay at the equivalent rate, unlike Gluskin where time was reduced and interest was increased.

“[T]he extension was made at a time when the borrower was in difficulty; it could be reasonably argued the extension gave the borrower a chance to turn itself around and pay off its debts. By itself, the extension cannot be said to be a material modification requiring an adjustment of priorities as a matter of law.” Lennar Northeast Partners v. Buice, 49 Cal. App. 4th 1576, 1584 (Cal. App. 3d Dist. 1996). Here the interest rate changed from a variable to a spot rate. The maturity date was extended as well as the principal amount in order to support the Trust company-debtor regain control of payments. The lower court ruled Trust company no longer had a priority claim since they modified the terms of the agreement. This Appellate court reversed ruling no material modification or prejudice to the subordinate lien holders.

The current 1322 (b) statement striken “other than a claim secured only by a security interest in real property that is the debtor’s principal residence[,]” modifications will be allowed to a debtor’s considerable residence. We are looking at cramming down the value of the property to what its actual value is today in order to free up extra cash applied to other unsecured and lower priority loans. This should not be considered a material modification since it is a best-effort to pay those we owe in the fairest way possible.

F. Title Insurance

Since valuation is at stake here and title insurance covers the actual value of the property, two major organizations should be discussed regarding insurance related to real estate; The American Land Title Association (ATLA) and the California Land Title Association (CLTA). ATLA and CLTA provide title insurance endorsing that the property at enlighten is free and easy to transfer and provides obvious assurances. When mortgage loans are modified, ATLA will not guarantee any subsequent agreements than the first policy contracted on the land. There are other coverage options that will require extra protection and endorse modifications set forth in ATLA Form 11 and CLTA Make 110.5. However, as mentioned in Gluskin, Shane and RTC, courts do not favor material modifications that prejudice junior lien holders; so long as Accomplish 11 and Form 110.5 do not own a material modification, the title insurance coverage value should be ascertainable.

To be exhaustively diligent, the title to the property should be examined early in a foreclosure proceeding. A pudgy title examination would, of course, be the most useful in that it would reveal any defects in the mortgagor’s title existing when the security deed was executed. However, where an attorney is provided with a mortgage title insurance plan (obtained when the security deed was executed) it is archaic to conduct a restricted title examination coming forward from the date of the security deed (2008 Cal ALS 80, Cal. Code Civ. Proc.§880.020(a)(4)). The title insurance policy should be provided to an attorney at the outset (Cal Ins Code §1063.1).

The limited title examination should include a search of the following public records; 1) deed records, 2) federal tax lien docket, 3) lis pendens docket, 4) bankruptcy records and 5) possibly probate records. It is also recommended to check the bankruptcy records shortly before a foreclosure sale. These factors are simply a guideline and to be sure all bases are covered, and to be sure your property does not contain any hindering constructs that Title Insurance may not mask.

I will highlight important factors to know:

1. Deed Records.

The deed records kept by the Clerk of the Superior court in the count which the land lies should be examined to ascertain the names of all persons who have held right to the property since the execution of the security deed. A chain of title is needed in order to preserve evidence of ownership.

Only litigation which goes to the validity of the security deed or the right to foreclose should stop the foreclosure sale. Any other litigation regarding the property concerns rights of parties which are subject to the security deed and thus subject to foreclosure (Cal. Code Civ. Proc.§ 880.260 (a)(1)).

If the lis pendens docket reveals the property in foreclosure is in the custody of a receiver, the foreclosure should immediately cease. Such property is in the custody of the court appointing the receiver, and its assets may not be interfered with unless the mortgagee intervenes in the proceeding and obtains authorization to foreclose. Where the due date is ascertainable from the relate, the 10-year limitations period of Civ. Code §82.020(a)(1), applies. Any recorded document that contains the due date of the note secured by the trust deed in question will suffice. Slintak v. Buckeye Retirement Co., L.L.C., Ltd., 139 Cal. App. 4th 575 (Cal. App. 2d Dist. 2006).

2. Bankruptcy Records.

The filing of a bankruptcy petition automatically enjoins a foreclosure against property of the debtor and of the insolvency estate (11 U.S.C.A §362(a) – automatic stay). All foreclosure activities should be dropped upon proper notification the present owner has filed bankruptcy. Failure to end the foreclosure could result in the lender’s (and perhaps the attorney) being held in contempt of court. Furthermore, a foreclosure sale conducted in defiance of the stay is void. Before proceeding with foreclosure, the lender must either achieve a court order lifting the stay or wait until the quit otherwise terminates under 11 U.S.C.A §362. Debtors or their attorneys generally notify the foreclosing lender of a bankruptcy filing, but not always. Therefore, it is recommended to check the Bankruptcy Court records to ensure the present owner has not filed. Since bankruptcy filings are often take place at the eleventh hour, the bankruptcy records should be checked shortly before the foreclosure sale date.

3. Federal Tax Liens.

A tax lien against anyone in the chain of title recorded must be dealt with in a specific manner. The trust deed will maintain its priority over subsequently filed federal tax lien. 26 U.S.C.A §7425 (b). Without IRS notice or consent, the federal lien will remain on the property superior to the purchaser’s title obtained at sale. The purchaser may apply for a Certificate of Discharge From Federal Tax Lien, however. 26 U.S.C.A §6325 (b).

4. Probate Records Need Not Be Examined.

A right of sale in the security deed is a power coupled with an interest and is therefore irrevocable so that the power may be exercised regardless of the death of the mortgagor. In California, a trust state, when a trustor has died, the successors in interest are entitled to receive notice of default under certain circumstances. Essentially, proof of interest must be filed in the county where the land is located. It must provide constructive witness to the trustee prior to the recording of the notice of default. Further, it must supply an address to which notices may be mailed. The trustee should try to track down successor’s but does not include the duty to. See Estate of Yates, 25 Cal. App. 4th, 511 (1994).

In light of the title, with a due diligent search, the proposed cram-down should not have any affect on the insured amount of your property so long as modifications made have not been determined material.

III. AN UNREGULATED INDUSTRY LEADS TO FRAUD

The Real Estate Settlement Procedures Act (RESPA) portion 6, 12 U.S.C. 2605, provides consumer protection with the mortgage-industry loans. The debtor may send a Qualified Written Request to the lender who in return must provide a written acknowledgment. During a suspension period, the lender cannot report to any consumer credit agencies (i.e. Equifax, etc). A debtor may also file a private lawsuit for a RESPA violation and noncompliance. The problem is that these written requests are often ignored and usually a strategy to obtain a conclude order.

In my opinion, Consumer Protection is thinly spread between too many agencies. The Consumer Protection Agency, the Federal Trade Commission and the Securities and Exchange Commission all stake claims on protecting consumers. Loan servicers are usually a secondary party working for a profit. When a loan goes into foreclosure, more fees are tacked on. Because of shrimp to no regulation in the mortgage industry abusive behavior tends to generate and fuel the already-stressed housing crisis.

Frustrated Homeowners deal with tacked on fee after fee, some services which have not even been performed (i.e. pre-paid charges for future overdue fees and inspection costs). Law Firms, such as mine, see these fees have a immediate impact on the increase of foreclosures since those fees only add to their monthly payments which keep increasing, the homeowner can no longer pay their monthly rate and thus default.

With further regulation which will be added with the new proposed bill, I have new administration will be able to identify, manage and address complaints with ease. I also hold ignored complaints will lessen since these complaints will now be moot if the court will now be addressing the root of the problem – valuation of the total debt.

IV. CRAM-DOWN EFFECTS.

This proposed bill may encourage more Chapter 13 bankruptcy filings. The Helping Families Save their Homes Act and HOPE for Homeowners is a rescue plan. President Obama is initiating so borrowers will have an opportunity to re-work their loan payments and pay all their debts without losing a home in foreclosure. The bill offers that legislation reimburse lenders part of their loss should a debtor is in a Chapter 13 and sells the property. Director Peter R. Orszag, of the Congressional Budget Office, analyzed forthcoming legislation and believes “the bill as a whole… would increase the budget deficit over the next decade, incur larger losses… higher coverage levels and insured deposits… gradually offset with higher future premiums.” Orszag, Peter R., Congressional Budget Office, Letter to Chairman Christopher J. Dodd- Chairman on Committee on Banking, Housing and Urban Affairs- United States Senate, October 1, 2008. The plan, designed to glean and manage failing and troubled assets will require additional administrative costs. The resale values will be hard to ascertain. Orszag believes proceeds gained in sales and future valuation increases will be less than the entire acquisition cost this government will continue making.

While Chairman Orszag proves a reasonable point, the solutions frail today cannot be applied in today’s world economy. It is clearly failing. Without some change that will jumpstart our economy, we will continue on the spiral downward turn. A different strategy will earn a unusual mechanism (i.e. The Energy Improvement and Extension Act of 2008 is another method to depart our economy). The key here is to conserve where we never have before in order to unlock new avenues of financing and spending.

As you sight, the tide of foreclosure is bringing heavy, quick-moving change. Presently, Bankruptcy Judges do not have the right or authority to unilaterally create mortgage loan modifications. Also, now loan modifications are usually worked by private consumer companies and law firms, mine included. Cram-down supporters say a cram-down is the ideal tool that encourages lenders to provide loan modifications for their borrowers. The cram-down bill allows federal judges to modify mark terms, decrease interest rates and mortgage loan balances of bankrupt homeowners. It also will permanently extend the Federal Deposit Insurance Corp.’s insured coverage to $250,000. Nay-sayers believe cram-downs will create higher interest rates (higher costs to catch a loan) and an even-tighter credit market.

Those opposed against the proposed bill say these additions are unnecessary provisions. One provision allows bankruptcy judges the authority to change the mortgage loan terms, like the loan balance, in a Chapter 13 bankruptcy proceeding. When we allow judges to deliver these changes, a question arises as to how the collateral value of the property at roar is calculated. Many fear an economic impact. Most of the lending community (including the American Bankers Association and other Republicans) stands against the proposal declaring mortgage rates will increase, forcing lenders to require larger payments up front in order to account for the newly added risk.

I will discuss.

Bifurcation

Bifurcation means a forking; a division into two branches. Section 506 of the title 11 United States Code (a.k.a. cram-down provision) authorizes bankruptcy claims to be bifurcated or split into secured and unsecured claims. §506 (a) maybe applied to Chapters 7, 11 and 13 claims. Courts are split, however, as whether to allow bifurcation or not. Stare In re Mordred J. Richards et al. v. Federal Home Loan Mortgage Corp., 151 B.R. 8, *; 1993 Bankr. LEXIS 284, **; Bankr. L. Rep. (CCH) P75, 145; 28 Collier Bankr. Cas. 2d (MB) 626. 11 U.S.C 506 provides the following:

“(d) To the extent that a lien secures a claim against the debtor that is not an allowed secured claim, such line is void, unless -

(1)such claim was disallowed only under portion 502(b)(5) or 502(e) of this title; or
(2)such claim in not an allowed secured claim due only to the failure of any entity to file a proof of such claim under section 501 of this title.”

Applied to section 1325 (a)(5) as follows:

“(a) Except as provided in subsection (b), the court shall confirm a plan if — …

(5) with respect to each allowed secured claim provided for by the opinion — …
(B)(ii) the value, as of the effective date of the plan, of property to be distributed under the plan on account of such claim is not less than the allowed amount of such claim…”

Judge Feeny in Richards cites and summarizes various district court decisions in conflict with the interpretation -thus clearly ambiguous– the “denial of bifurcation would be a windfall to mortgagees whose worthless unsecured mortgages would continue to encumber debtors homes to the extent of the debt after Chapter 13. This result would counter to the reorganization provision of Chapter 13 premised upon the retention of assets and the fresh start policy of the Bankruptcy Code.” With the new provision the conflict of whether to bifurcate claims or not will likely be resolved since the courts will now be able to revise the actual secured claim amount.

Valuation of the property is “fixed at the time of conception confirmation,” Richards at 30. The result then under HR 3609, would be current asset value of homes will be significantly lower than what was originally mortgaged. The cram-down value will then be lower and the debtor pays less. Then, of course various arguments arise as to whether the loan is really secured or not since the actual value is much lower. I will not address these arguments here. My goal is to simply answer the question at affirm which I do not fill security is at issue – only valuation and added costs.

Filing Bankruptcy

“Under chapter 13 of the Bankruptcy Code, unless the debtor surrenders the property securing the lien to the holder of an allowed secured claim provided for by the plan or such holder accepts the thought, a chapter 13 plan that provides for a secured claim may not be assured of confirmation without a cram down provision comporting with section 1325(a)(5)(B). Chapter 13 cram down is comprised of two essential elements, lien retention and equivalent value, distributed in accordance with certain rules each of which must be provided for under the chapter 13 concept itself.” Collier on Chapter 13 Cramdown, 2008 Emerging Issues 1253. In today’s market, with declining housing markets, unemployment rates rising steadily our legislators are taking action in order to stabilize what we already know is a declining economy. Most understand the definition of cram-down as “a court-ordered reduction of the secured balance due on a home mortgage loan, granted to a homeowner who has filed for personal bankruptcy.” Finance and Business Terminologies, http://www.answers.com/topic/cram-down.

A judge will then identify the real value of the home as the secured value, and the deficient balance as unsecured, then prioritized as such. Example: A bankruptcy judge considers a $400,000 property value that contains a $350,000 first mortgage and $50,000 unsecured debt. He can then allow $350,000 to the first mortgage holders, and cram-down the $50,000 unsecured debt to $10,000. With proposed law HR 3609 a judge may alter the secured and unsecured debt as he sees it and to define what the debtor actually owes maybe too much. If a debtor is making payments on a $200,000 mortgage on a home valued at $120,000, that debtor is paying over-the-top an unjust amount and thus not in compliance with §1325 (a)(5)(B)(ii).

Basic Contract rules provides when asset valuation declines rapidly due to unforeseen market changes, parties to that contract may be excused from performance due to commercial impracticability or courts tend to support contract modifications. “When the occurrence of an unforeseen event would cause a promisor to occupy and unexpectedly large loss in performing her contractual obligation, the parties might renegotiate and modify the promisor’s contract… The accepted law doctrines of impossibility and commercial impracticability release the promisor from her obligation on the grounds of an unforeseeable supervening event that increases the cost of either literal performance or damages liability to a level beyond the anticipated values at the time of contracting.” Triantis, George G., Unforeseen Contingencies. Risk Allocation in Contracts, University of Virginia Law School (1999). It is clear with today’s market changes, the debtor’s value has significantly decreases and must be allowed and addressed with modification.

Section 5, H.R. 3609 Elimination of credit counseling requirement for chapter 12 debtors facing foreclosure, offers to strike from section 109 (h) of Title 11 “shall not apply with respect to a debtor in a case under chapter 13 who submits to the court a certification that the holder of a claim secured by the debtor’s vital residence.” This somewhat loosens the restrictions for what may or may not be of benefit to the debtor. Under credit counseling advisement, a person must understand the root of the financial jam. Sometimes it may only be a hardship where no matter how much credit counseling one gets, you would still have to file bankruptcy (i.e. medical costs for an unexpected accident or sickness).

V. Conclusion

H.R. 3609′s biggest impact here will be actual property valuation. Declines in property values are at the forefront. Homes that mortgaged at $200,000 may only be worth $120,000 today. While the new administration maybe and probably will be required to manage activity proposed here, I am not convinced this will negatively impact the current Mortgage business today. Will it stop excessive fees? Probably. Does that impact mortgagees? Yes. However, the leverage of these new rules will only help manage fraudulent activity. Will title insurance coverage be affected? Yes, but only in the sense of what property will be automatically valued by the court. Credit Counseling will no longer be another hurdle to jump. Since managing a credit report should be a job in itself, and identity fraud is at it highest, we cannot solely rely on credit report updates. That said, I believe opponents of the bill provide reasonable arguments; but do not address any other avenues resolving the conflict. If we march forward under the same rules and regulations, we will continue to spiral downward. I fill the change will a better influence and will allow debtor/homeowners the relief they need to save their most prized-possession-their home.

End Notes:

“Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. Persons who were not working and were waiting to be recalled to a job from which they had been temporarily laid off are also included as unemployed. The unemployment rate represents the number unemployed as a percent of the labor force.” (Bureau of Labor and Statistics, as of May 4th, 2009)

2 “No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt, solely because such debtor or bankrupt” (Title 11 sec. 525 (b) U.S. Bankruptcy Code)

3 See Hollowell, Eileen W., Levitt, Kathleen, et al; First This Way, Then That Way -Conflicting Interpretations of BACPA, American Bankruptcy Institute, Consumer Bankruptcy Committee, Volume 4, Number 2 (2007); http://www.abiworld.org/committees/newsletters/legis/vol4num2/1.pdf. A bankruptcy judge and Chapter 13 Trustee and others came together to discuss the importance of using insensible language statutes provide and when ambiguous, a statute should be revisisted.
See In re Hardacre, 338 B.R. 718. The court here sorts out the meaning of projected disposable income and actual disposable income and the means test applied.

4 Deed in lieu of foreclosure. This is usually feasible only if the property is free from junior liens and encumbrances. There is, however, a risk of the conveyance being subsequently set aside by a bankruptcy court as a preferential transfer if the property was worth substantially more than the indebtedness. If this plot is dilapidated, the mortgagor should be required to label an estoppel and solvency affidavit in addition to the deed. The mortgagee may also want to consider including non-merger language in the deed and not releasing its security deed for some time after the transfer to insure that it as least retains its secured position in the event a bankruptcy court should set aside the conveyance. GBJ, Inc., II v. First Ave. Inv. Corp., 520 N.W.2d 508 (Minn. Ct. App. 1994).

5 The filing of a bankruptcy petition automatically enjoins a foreclosure against property of the debtor and of the bankruptcy estate (11 U.S.C.A §362(a) – automatic stay). All foreclosure activities should be dropped upon proper notification the current owner has filed bankruptcy. Failure to stop the foreclosure could result in the lender’s (and possibly the attorney) being held in contempt of court. Furthermore, a foreclosure sale conducted in violation of the stay is void. Before proceeding with foreclosure the lender must either obtain a court order lifting the stop or wait until the stay otherwise terminates under 11 U.S.C.A §362.

6 California Civil Code 2823.6(a) states that “a servicer acts in the best interest of all parties if it agrees to or implements a loan modification where the (1) loan is in payment default, and (2) anticipated recovery under the loan modification or workout plan exceeds the anticipated recovery through foreclosure on a win present value basis.” California Civil Code 2823.6(b) now provides “that the mortgagee, beneficiary, or authorized agent offer the borrower a loan modification or workout plan if such a modification or plan is consistent with its contractual or other authority.”

7 397 Mass. 479; 492 N.E.2d 92; 1986 Mass. LEXIS 1291

8 42 F.3d 1206, *; 1994 U.S. App. LEXIS 34123, **; 94 Cal. Daily Op. Service 9295; 94 Daily Journal DAR 17208

9 “For purposes of this subsection, a expedient written request shall be a written correspondence, other than notice on a payment coupon or other payment medium supplied by the servicer, that–(i) includes, or otherwise enables the servicer to identify, the name and account of the borrower; and(ii) includes a statement of the reasons for the belief of the borrower, to the extent applicable, that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.” (12 U.S.C 2605 (e)(1)(B)).

10 Better Business Bureau, report # unknown, author unknown, submitted March, 2009.

11 Bifurcation. Webster’s Dictionary, Merriam-Webster 11th Edition (2007).

Allstate Teen Insurance
Allstate has a great teen driver program, which focuses on a parent-teen driving contract. The parent and the teen decide on agreements for certain actions, like talking on a cellphone while driving and having a curfew, set limits on these actions (or ban them altogether), and finally make consequences if the teen driver breaks any part of the contract. Allstate insurance has taken a great initiative with teen driving safety, and their website http://www.allstateteendriver.com outlines all of their efforts to keep teens safe.

Statefarm Teen Insurance
Statefarm offers two mountainous opportunities for students to save on car insurance. The first is the ‘Good Student Discount’, which rewards students who get good grades by reducing the auto insurance cost. This is a great incentive because, for students with lower grades, it is good motivation to increase grades if they are paying for their insurance, and for students with higher grades, it’s a greater incentive to keep up the good work. Another highlight of auto insurance for teenagers at Statefarm is the Steer Clear Genuine Driver Discount, which is also pointed towards students. It is an extra refresher course that, when completed, gives an extra discount to those 25 and under. The course can be completed with a kit, on a computer, or even on the iPhone.

Progressive Teen Insurance
Besides offering an online directory with information on auto insurance for teens, Progressive also offers student discounts when applicable. In the online directory, Progressive help walk teenagers through the insurance process, explaining each step. Also, they give tips on safe driving and keeping your cool. For example, one page offers tips on how to avoid road rage and calm yourself down when it inevitably happens. Another page explains all of the information needed in order to get a quote and figure out how much the auto insurance will cost for the teenager. Specifically, besides the general student benefits, Progressive doesn’t add any special features or benefits for their auto insurance for teenagers

Liberty Mutual Teen Insurance
Liberty Mutual is very straightforward on its website, http://www.libertymutualteendriving.com, on explaining what a teen and their parent can do to make sure they get the best teen auto insurance value. Liberty Mutual also offers student advantages, where if a student has good grades, they can get up to a 35% discount on their insurance. The amount of the discount varies depending on the grades of the teenager. Liberty Mutual insurance also tells all the specific ways a teenager can save on auto insurance, which is very beneficial to have in one condensed area.

Geico Teen Insurance
Geico is yet another student-rewarding insurer, offering discounts for taking a driver’s education class and getting good grades. If the teen driver took a driver’s education class, then they are eligible for a discount on their auto insurance. Also, if they get a B-average or higher, they receive another discount. Geico does not offer any other specific teen benefits or tips, meaning the only thing that could accomplish Geico the best teen auto insurance choice is the price of the insurance.

You have the information now; use it to figure out which insurance plans and benefits are right for your teenager, ensuring their safety and saving as noteworthy money as possible.

Philip Reed, Auto Insurance for Teenage Drivers, Edmunds.com.
Geico, Geico.com, Geico.
Progressive, Progressive.com, Geico.com.
Liberty Mutual, libertymutual.com.com, Liberty Mutual.
Allstate, Allstate.com, Allstate.com.

NOTE: JBL should have NOT come back from retirement. Lame.
Jerry “the King” Lawler says that there’s a “blockbuster announcement” to be made by Stephanie AND Shane McMahon, and it’s coming up NEXT!
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Back, and they show members of the Chicago Cubs in the front row.
Mike Adamle comes out…and King says that he is “an original”
(CROWD BOOS)
Announces CM Punk vs. Chris Jericho…and announces that at Unforgiven, a 20-minute, 5 superstar match will take place! Features CM Punk, Kane, JBL, Batista, and Cena. It is called the “Championship Lumber” and Mike Adamle calls it an “innovative concept”…makes me laugh.
Cody Rhodes and Ted DiBiase are out now, and it sounded like Lillian Garcia BOTCHED their announcement.
CRYME TYME OUT!!! Shad distracts Priceless while JTG JACKS THE TAG TEAM TITLES!!!!!!
John Cena comes out to a mixed reaction, as usual. King thinks that Cena got Cryme Tyme to jack the Stamp Team Championships!
John Cena vs. Rhodes/DiBiase – one pinfall, 2 on 1 handicap match
Michael Cole takes us to commercial as the match gets underway.
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Back and Cena has Rhodes in a headlock, and gets him into the corner. Ref breaks it up, and Rhodes gets a cheap shot on Cena! Cena chases Rhodes out of the ring, back in, and Rhodes tags in DiBiase. 2 count pinfall by DiBiase, kickout, and a double-suplex on Cena by Priceless. Screen, kickout at 2 by Cena. Dropkick by Rhodes, and another 2 count pinfall. Side-Russian legsweep by Rhodes, and he follows it up with a running knee-drop. Cena on the ring apron, and Rhodes pushes him off the apron and into the barricade! Cover, and a 2 count kickout by Cena. Cena with a head of steam, and DiBiase with a side suplex, followed by a fist-drop, and clothesline! Cover, and a kickout at 2 by Cena. A tandem move by Priceless, and a 2 count kickout by Cena. Good match so far. Cena in Priceless’ corner, and he fights out only to get hit for a 2 count cover by Rhodes. Cena off the ropes, and Rhodes ducks Cena’s flying shoulder-block. On the outside, and Rhodes sends Cena into the steel ring steps. Into the ring, and Rhodes gets a 2 count on Cena. DiBiase with a snap suplex, and a 2 count on Cena. Cena with a reversal on DiBiase, and Cena buys some time. Tag to Rhodes, and Rhodes and Cena go at it. Cena gets a second-wind, and shoulder block, shoulder block, and side suplex into You Can’t See Me. /Five Knuckle Sprint. Cena gets Rhodes in the FU position, but drops to knock out DiBiase. Then Cena gets Rhodes in the STFU! The ref calls for the bell!
Winner: Cena by submission
Cena parades around the ring, bumping his chest. Up next are Strange comments by Shawn Michaels about what happened to his wife at SummerSlam!
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We are aid, and Harley Speed is sitting at ringside!
They show a video package of Jericho hitting Rebecca Michaels again, in preparation for comments by Shawn Michaels. Michael Cole says that Rebecca Michaels suffered a “broken jaw” at SummerSlam as a result of the punch. They cut to an exclusive interview with Shawn Michaels after SummerSlam, and Shawn says that he’s “going to go home, comfort his wife, his kids – and then…and then…” and Michaels walks away with his wife in hand.
–
They slice to an interview with Cm Punk! Punk says that what Jericho did was insane. Punk says that in Chicago, they deal with guys like that. It’s going to be done on Punk’s terms, and “Chicago style”.
–
Santino Marella and Beth Phoenix come out next, and display the WWE Women’s and Intercontinental Championships that they won at SummerSlam against Kofi Kingston and Mickie James. We go to commercial as D-Low Brown vs. Santino Marella battle for the Intercontinental Championship!
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Santino Marella vs. D-Low Brown – one fall match

We are back as D-Low Brown comes out, and gets a great reaction. KOFI KINGSTON comes out to join on commentary. Leg lariat by D-Low Brown, a former IC Champion. D-Low BOTCHES a slip off the ropes, and Marella covers for a 2 count on D-Low. D-Low back in control, and gets up on the top rope for the Low-Down, and Beth Phoenix gets in the ring! A slap to D-Low’s face by Phoenix, and D-Low loses!
Winner: D-Low Brown via disqualification
After the match, D-Low does a back-body drop on Marella, and clotheslines him over the top rope to the outside announce table…where Kofi Kingston smashes his head on the table! Beth Phoenix and Santino Marella then take their Championships and head to the back as D-Low Brown and Kofi Kingston watch.
–
Cut to a shot of Kane walking backstage! Michael Cole explains what was in Kane’s bag; Rey Mysterio’s mask! We go to commercial as Kane keeps walking.
NOTE: Spooky music is playing – did Kane’s theme music get changed?
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Kane comes out, and WWE CHANGED KANE’S THEME MUSIC!!!
NOTE: NOT COOL. First Jeff Hardy, now Kane. BOOOOO
Kane says that the fans looked shocked when he pulled Rey’s mask out of the bag. Kane has been carrying it for a while, putting a smile on his face. Kane says that Rey has not been seen for 6 weeks; because Kane doesn’t like Rey Mysterio-and hates people who don’t. Rey is like a “fungus who grows in the depths of your psyche”. Kane then says” is Rey Mysterio lifeless…or alive? “
NOTE: KANE HAS SOMETHING IN HIS TEETH!!! HILARIOUS!!! The catering must be good. That piece of leafy greens was VERY determined in WWE HD.
BATISTA COMES OUT! And Kane and Batista commence to go at it! Spear and a spinebuster by Batista! Kane chop blocks, and then chokeslams Batista! That’s it for Batista, and Kane gets out of the ring and walks to the back.
We go to commercial!
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We are back, and it’s time for the MAIN EVENT!
Jericho is out first, and he’s with Lance Cade.
SIGN: RAW IS MICHAELS
NOTE: Apparently not anymore.
CM Punk out, and HUGE POP from his hometown.
CM Punk vs. Chris Jericho – non-title match, one pinfall/submission match
Starts off with the crowd chanting “CM PUNK” – Punk starts off with Muai Thai kicks, and off the ropes for a clothesline. Punk with a snapmare takedown, and a kick to the wait on on Jericho. Punk with Jericho in the corner, and Jericho fights out, and gets Punk in the opposite corner with leg kicks and punches. Punk with a reverse-sunset flip, and Punk gets a 2 count cover on Jericho. Jericho charges Punk, and Punk sidesteps Jericho…Jericho between the ropes to the outside! Michael Cole sends it off into a commercial break.
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We are serve as Jericho has Punk in a rear-naked-underarm choke. A couple of side-elbows by Punk, and Jericho sends Punk off the ropes for a clothesline, cover, 2 count on Punk. A couple of elbowdrops by Jericho, and Jericho picks up Punk for a backbreaker, into a modified bow-and-arrow stretch submission over Jericho’s knee. Punk breaks free, and Jericho gets Punk into a standing side stretch submission. Punk breaks free, and Jericho sends Punk into the corner…and Jericho goes for a bulldog, and Punk with a kick to the side of Jericho’s head! Punk with momentum now, and Punk with a double-underhook backbreaker on Jericho, 2 count! Punk with a running knee in the corner, and Jericho counters the running bulldog. LIONSAULT by Jericho, 2 count! Punk now with a hurrancarana, and gets a 2 count! Punk in the corner with Jericho, reversal, and Jericho with a running elbow. Punk lifts Jericho in the GTS, but Jericho counters, and WALLS OF JERICHO!!! In the center of the ring, will Punk tap out? Punk crawling to the ropes, and he gets there! Jericho frustrated, and goes to the top rope! Punk with a running high knee on Jericho…and a second-rope bulldog by CM Punk on Jericho! Lance Cade on the ring apron, and Jericho hits CM Punk with the CODEBREAKER! Jericho gets the 1,2,3!!!
Winner: Chris Jericho by pinfall
The credits roll, and RAW is done!
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OVERALL: There was a lot of actual wrestling in this show, pretty good. No advancement of storylines (well, maybe a little) but overall, a program packed with professional wrestling matches.
6 out of 8

Sarah Horowitz may be the answer to non-insured’s prayer. A Modern York-based Freelancers Union fulfills many frustrating workforce’s attempts to acquire affordable insurance, and the Union recently announced its plans to open its own insurance company with the goal of offering a cheap system with good coverage.

A Cornell University graduate, Sarah Horowitz, is a former labor attorney and union organizer. Her goal is to form a union where freelancers with their collective power generate a group purchasing of insurance, resources and advocacy. The spectrum of services include health and dental coverage, disability, life insurance where rates are charged based on member needs, And many independent contractors are ever so grateful that Horowitz has championed their cause, and make a success of providing the insurance.

That’s the Enterprising Idea feature presented by Jim Lehrer on PBS News Hour tonight.

Started in 1995, is a national non-profit organization called Freelancers Union grew out of the America’s growing independent workforce accounting for about 30% of the entire workforce.

The insurance is a better option than COBRA (an insurance program for continued insurance after leaving employment, but this is relatively expensive). There are eligibility guidelines to be met, but once you’re in, there is no need to keep justifying the eligibility.

American corporations are cost cutting and increase flexibility and the resulting consequence is increased independent workforce. According to the Freelancers Union, the workforce includes “the segment of the labor force working outside of standard employment arrangements as independent contractors, temporary workers, contract workers, leased workers, part-time workers, on-call workers, day laborers, and the self-employed.”

The FAQ have answers to most questions regarding eligibility and information about the company.

To be eligible for insurance, the applicant must a) be an independent worker, b) be a U.S. resident, c) work in an eligible industry or occupation and d) having documentation showing 20 hours worked in the last 8 weeks or earned at least $10,000 in the last six months.

The eligible industries are limited but used to only cover one industry when they first started in 2001. The industries covered are: a) Arts, Design & Entertainment, b) Domestic Child Care Giver, c) Financial Services, d) Media & Advertising, f) Nonprofit, g) Skilled Computer User, h) Technology and i) Used or Alternative Health Care Provider. Over time, more benefits to cover more industries are added as negotiations continue with insurance carriers. A survey taken giving them suggestions helps them understand the needs of members that may have be able to cover and it also signs you up for the monthly e-newsletter for important notifications.

Not everyone in the independent workforce is eligible to participate in the Freelancers Union presently, however, for those who are eligible, it provides a safety acquire of insurance and other health insurance products that they never had. Freelancers Union continues to work to increase more eligible industries.

President Obama hopes to provide insurance opportunities for millions of Americans who are not covered and this company could be the wheel to commence the research, instead of trying to reinvent the wheel from scratch.

Source

Comments regarding Freelancers Union membership http://forums.macresource.com/read/1/703201

http://www.freelancersunion.org/

What is the Freelancers Union? http://www.sitepoint.com/blogs/2009/03/19/what-is-the-freelancer%25e2%2580%2599s-union-and-do-you-need-to-join/

http://www.pbs.org/now/shows/407/freelance-facts.html

PBS Benefits Denied http://www.pbs.org/now/shows/407/transcript.html; http://www.pbs.org/now/enterprisingideas/freelancers-union.html

http://en.wikipedia.org/wiki/Freelancers_Union