| ID |
Name |
Group |
Other |
Code
Sec |
Cross
Ref |
Problem Referenced |
Proposed Solutions |
NBRC-
0032 |
Wall Street Journal - Section C |
|
|
|
|
Bankruptcy filings are up. Stigma is fading, assets
can be protected, credit stigma no longer a problem. You only get a
discharge every six years. Information on National Foundation for
Consumer Credit. |
Credit Counseling is the key. Bankruptcy is not the
only alternative to a large debt load. |
NBRC-
0033 |
Wall Street Journal |
|
|
|
|
Individual bankruptcy filings are skyrocketing. Gives
map of highest filings. |
Consumer credit debt is not the only reason. High
divorce rates; no medical insurance; no auto insurance requirement are
listed as other factors that can lead to idividual
bankruptcy. |
NBRC-
0040 |
David F. Bartone |
President & CEO of Corning Federal Credit
Union |
|
|
2d |
Total charge-offs for past three years have risen
from $342,286 to $974,505. 95% of that increase is due to bankruptcy.
Research has revealed that 80% of bankrupt loans were solid when granted
& individuals were encouraged to file without any real difficulty.
Bankr. has become the method whereby individuals can keep almost
everything of value except their obligation to pay. |
Making bankruptcy the easy way out MUST STOP! Or the
credit unions and the majority of their good customers will continue to
lose. |
NBRC-
0072 |
Pam Catlin |
CEO; Sequoia Hospital Employees Federal Credit
Union |
|
|
9th |
Huge increase in the amount charged off in the last
12 mos. compared to charge-offs from 1990 through 1994. Although some of
it can be attributed to health-care industry trends, certain disturbing
trends have appeared: No social stigma to bankruptcy; no need to learn
fiscally responsible way of life; lax consumer credit standards; better
credit standing for seven than for thirteen; lawyers deterring debtors
from reaffirming any of their debt. Most difficult for smaller lenders
who can't pass losses on to other customers as easily as larger
institutions. |
Place some limits on access to credit card. Stiffer
consequences for those who do file for bankruptcy, such as mandatory
credit-counseling. Also stronger incentive to encourage people to pay
back more of their debt. |
NBRC-
0098 |
Polly S. Higdon |
Bankruptcy Judge; District of Oregon |
Invited Participant to Consumer group - Santa Fe
meeting. |
|
9th |
There is no limitation on the frequency or number of
Ch. 13 filings for individual debtors. In OR it is a serious problem
with frequent multiple filings. |
Has provided the NBRC with four months of computer
printouts attempting to show why certain debtors make multiple
filings. |
NBRC-
0100 |
Ike Schulman |
President; National Association of Consumer
Bankruptcy Attorneys |
Invited Participant to numerous NBRC
meetings. |
|
4th |
Dispute has arisen as to how big a problem serial
filings really are, whether they are rampant or comprise a very small
percentage of the cases that are filed. |
NACBA experience is that serial filings are often the
result of changed circumstances beyond the debtor's control. With regard
to small fraction of serial filings that are abusive, appropriate
remedies exist under current law. Section 110 new controls will greatly
reduce the number of serial filings. Protect the rights of honest
debtors who may need to file more than one petition and to narrowly
tailor any remedy to only those cases that are abusive. |
NBRC-
0101 |
Ike Schulman |
President; National Association of Consumer
Bankruptcy Attorneys |
Invited Participant to numerous NBRC
meetings. |
|
4th |
Some debtors attempt a subsequent ch. 13 payment plan
after dismissal of a prior case. In most cases, the prior dismissal
resulted from a temporary loss of income during the prior case which
made it impossible for the debtor to complete the plan. This loss of
income is usually due to a job layoff or illness. Usually the debtor
will be able to resume work and propose a viable payment plan. Current
law allows a debtor to refile a ch. 13 petition where circumstances
warrant, subject to the creditors' right to object on bad faith grounds.
Also, a debtor right to refile is already limited to protect creditors
from frivolous refilings where a creditor has filed a motion for relief
in the prior case. Many debtors are successful in completing a
subsequent case and repaying their creditors after the dismissal of a
prior case. |
NACBA recommends that there be no change in the
current law allowing repeat filings. |
NBRC-
0109 |
Karen Gross |
Professor of law; New York Law School |
28 U.S.C. § 1930 |
|
2nd |
All needy debtors should be allowed to file without
having to pay a filing fee. |
All needy debtors should be eligible for relief in
bankruptcy on an in forma pauperis basis. This requires amending various
provisions of Title 28, including 28 U.S.C. § 1930. |
NBRC-
0116 |
Kenneth J. Doran |
Doran Law Offices |
Participated at Consumer Bankruptcy Working Group on
July 19. |
|
7th |
Mr. Doran did not state a problem, but rather offered
his view of the goal of consumer bankruptcy. |
N/A |
NBRC-
0569 |
The Legislative Committee of The Summit Federal
Credit Union, Rochester, New York |
|
|
|
2 |
Author gives statistical information on the rise in
bankruptcies which they have experienced, and their comments on various
provisions of the National Bankruptcy Review Commission's draft proposal
for changes to Chapters 7 and 13. |
|
NBRC-
0589 |
Sy Nguyen |
|
|
|
9 |
Author filed bankruptcy because of large credit card
debt and loss of his job. He encloses two articles on consumer
debt. |
The government shsould regulate credit card
solicitations and control the banks to keep the initial interest rates
for a longer period and it should remain fixed for the charged amounts
at the rate that applied when the initial transaction
occurred. |
NBRC-
0598 |
William R. Mapother |
Attorney |
Chart of Mapother's Comments on Draft #1 Proposals;
Memorandum on Draft #1 of Consumer Bankruptcy Working Group by
author. |
|
6 |
Debtors' advocates blame lenders, especially credit
card issuers, for the plethora of bankruptcies. |
The Commission should recommend legislative limits on
credit card issuers. 15 USC 1642(1) should be amended to prohibit mass
mailing of credit card solicitations. Make it illegal or an unfair
credit practice to solicit by mail any consumer with whom the creditor
has not had some business relationship prior to the mailing. Any debt
incurred through such a solicitation should be made dischargeable and
unenforceable and unrecoverable in Chapter 7 and/or 13. |
NBRC-
0646 |
Royce E. Wallace |
Attorney, Chapter 13 standing trustee |
Memorandum by the author on the Functions of a
Standing Chapter 13 Trustee |
|
10 |
Author feels the consumer credit marketing community
is significantly impacting the commission, as can be seen in the
absolute six year bankruptcy bar coupled with a discharge on
confirmation of a plan. "The Commission should keep in mind the fact
that virtually the only restraint in consumer leading [sic] is access to
bankruptcy relief." |
|
NBRC-
0649 |
Elizabeth S. Petersen |
Attorney |
|
|
4 |
"I have very few instances, in my own knowledge, of
debtors who abuse the system by refiing repeatedly. Most of the debtors
that I have met and represented have refiled because they have lost
their job during the original filing and want to continue to try to make
payments and keep their property. |
None. |
NBRC-
0655 |
William Mark Bonney |
Standing Chapter 13 Trustee, Eastern District of
Oklahoma |
|
|
10 |
Author writes about two cases which "show how credit
card companies invite abuse by their own credit issuance practices." He
encloses the petitions and schedules of each for reference. |
"It is my hope that the Commission believes that
credit card issuers do not need protection but only need to act in a
manner that is more consistent with prudent banking policies and
procedures." |
NBRC-
0669 |
J. Michael Combs |
Attorney |
Advertisement from an automobile dealer to help
Chapter 7 and Chapter 13 filers buy cars. |
|
6 |
Author, along with other attorneys from his area,
discusussed Chapter 7 vs. Chapter 13 filings. They concluded that among
themselves, that ratio of about two Chapter 13s for every Chapter 7 had
changed over the past 12 months to approximately 50/50. They came up
with four reasons why this shift had occurred: 1. Over the years,
Chapter 13 has become legally more difficult and therefore less
desireable, while Chapter 7 has not changed; 2. The proposed change that
Chapter 13 filings be severly limited, even to once in a lifetime; 3.
The sudden rise in unsecured debt, particularly credit card debt, has
given rise to more Chapter 7 filings; and, 4. Chapter 7 has simply
become less onerous - they are inundated with requests for
reaffirmations, credit card companies an automobile finance companies
are willing to give credit again within 3 months with a Chapter 7
discharge. |
|
NBRC-
0703 |
Steven J. Abelson |
Attorney |
Abbreviated financial statements of four
representative clients. |
|
3 |
Author represents consumer debtors. "[T]he often
stated perception of debtors as financial malingerers or worse, as
"deadbeats," is as inaccurate as can be." "The Bankruptcy Protection is
a vital and important safety net in our society, which should not be
dismantled on the basis of perception." |
|
NBRC-
0729 |
Gerald L. White & Gary H. Gale |
Attorneys, White & Gale |
|
|
9 |
"It is our belief that the credit industry is in
large part responsible for the record number of bankruptcies and the
situation will continue as long as credit is made so readily available
without any concern for the ability of the consumer to repay." "The
concept of a fresh start is crucial to the clients that we have seen
over the years." "Virtually every client that I have seen goes through
tremendous personal trauma in reaching the decision to file bankruptcy.
for many of these clients their situation came to a head based on
theloss of a job, a cut in pay, unexpected medial bills that weren't
covered by insurance, sseparation or divorce, having to take on the
support of a relative or other matters that were beyond their control.
When they are in default, the creditors are rarely willing to work out a
reasonable payment plan while the interest continues to accrue
rapidly." |
None proposed. |
NBRC-
0760 |
Stephen Brobeck |
Executive Director, Consumer Federation of
America |
|
|
|
Author submits report on "The Consumer Impacts of
Expanding Credit Card Debt" in which he discusses consumer credite
practices, especially with regard to credit cards, and its impact on
bankruptcy filings. |
Consumer education is necessary but not a sufficient
solution to the problem of consumer debt from credit cards. Creditors
must be more careful in making risk assessments before they extend
credit, focusing on the relationship, in each household, of
cared-related credit extended (total used and unused credit lines) to
income. Limiting the ability of debtors to enter Chapter 7 bankruptcy is
punitive and unnecessary. |
NBRC-
0765 |
Suze Kaczmarczyk |
Bankrupt/Repossession Coordinator, Hoodview Federal
Credit Union |
|
|
5 |
Author critiques Draft #1 dated March 5, 1997 of the
Consumer Bankruptcy Working Group. She feels that the draft puts more of
a burden of loss on creditors, and does not do enough to assist in true
rehabilitation of the debtor. Author believes that the areas which
should be addressed are twofold: first, the prevention of avoidable
bankruptcy filings; and, second, maximizing the rehabilitation of
debtors, which would also increase the rate of return to creditors. "In
my opinion, the primary cause of bankruptcy is financial ignorance on
the part of the debtor." |
Author includes an almost one-page outline of general
and specific suggestions to prevent avoidable bankruptcy petition
filings and maximize recovery after a bankruptcy petition is
filed. |
NBRC-
0812 |
Bernard S. Via, III |
Attorney, Via & Frye |
Article from Standard & Poor's, Waterhouse,
December 1996 issue showing that bank stocks are gaining profits from
consumer credit; Article from Bankruptcy Law News indicating that
consumer bankruptcies follow consumer debt load in Virginia. |
|
4 |
"At this time, it looks like the banks are attempting
to make it more difficult for consumer creditors to file bankruptcy They
do this every time bankruptcies increase." "Extension of consumer debts
parallel the filings of bankruptcy. In other words, in order to get
higher profits the banks are scraping the bottom of the barrel." People
are being given credit with too little income. "AS a consequence, more
people are being overloaded with debt which is causing them to go
bankrupt and abandon any attempt to repay debts. The higher consumer
debt along with the high interest rates simply swamp the ability of the
creditor to keep up....Additional factors not mentioned in the articles
which I see very day include lack of insurance for medical care, car
accidents, taxes and divorce. The penalty charges of the I.R.S. drive
people out of business and into cash work." |
None |
NBRC-
0904 |
Todd A. Koenig |
Attorney, Todd C. Esser & Associates |
|
|
The reason for the bankruptcy problem is the "easy,
if not careless," access to credit created by the credit industry desire
for profit. |
7 |
The government should not interfere in trying to
lessen bankruptcy filings. "Market forces will eventually even out the
dynamic. Credit pushers will be force to accept some responsibility in
the issuance and continuance of credit if they wish to avoid the obvious
consequences of indiscriminate and careless credit." |
NBRC-
0924 |
Stephen E. Shamban |
Attorney & Panel Chapter 7 Trustee |
Copy of article "Consumer Bar to Commission: Don't
Credit Creditor Views", Consumer Bankruptcy News, June 5,
1997. |
|
1 |
Author encloses a copy of an article from Consumer
Bankruptcy News describing the work of the NBRC. "It should be
recognized that the current expansion of consumer bankruptcies is due,
in large part, to the virtually promiscuous granting of credit by these
institutional creditors." "I have also found that in many many cases, it
is the creditors and their unwillingness to negotiate delinquencies in a
fair and reasonable way who force many debtors into filing Chapter 7 or
Chapter 13." "In virtually every case involving consumer credit that I
have handled within the last two (2) years, I have found that despite
their willingness to make reasonable payment arrangements combined with
extreme distaste towards the concept of even filing a bankruptcy, the
debtors feel justified in proceeding to bankruptcy based on the
creditors' unwillingness to negotiate. The debtors feel they have made
their best efforts and have been rebuffed." |
"I hope that the Commission takes these realities
into consideration and resists the one-sided blandishments of the credit
industry which seeks to influence you Commission into recommending
changes to the Bankruptcy Code which would make it more difficult for
deserving debtors to obtain relief." |
NBRC-
1051 |
private citizen |
|
|
8 |
Author "went through bankruptcy, discharged 4/97" and
found it to be a very humbling experience. Although he aknowledges his
responsibility for the debt, he also feels that "some or a large share
of the problem should go to my creditors. If they wouldn't have been so
free with and credit and greedy for my finance charges I may not have
been put thru this." |
"I think bankruptcy would go down if the credit
companies were a little more careful with who they gave credit
to." |
NBRC-
1059 |
Fred D. Paul |
citizen |
|
|
5 |
Author notes that he is considering filing personal
bankruptcy. He had been "lured by attractive easy credit to accomplish
the immediate goal of helping to provide better things for my family."
Now his VISA credit card interest has been raised to 26.94%, he has a
large balance, and the interest payments alone are huge. "I am not
alone. Please help." |
See above. |
NBRC-
1176 |
John C. Akard |
Bankruptcy Judge, Northern District of
Texas |
Letter dated 10/7/97 to Hon. John C. Akard from
George F. McElreath, Assistant U.S. Trustee with enclosures. |
707(b) |
5 |
Author is forwarding information from the United
States Trustee outlining the Trustee's procedures for reviewing cases to
determine if ther is a substantial abuse in the bankruptcy
filing. |
N/A |
NBRC-
1178 |
MaryJane Miller |
|
|
|
9 |
Author gives a list of "a few of the things that are
making a consumers have a worse time paying their bills." |
N/A |