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Legal Blog - Ohio, Kentucky, Indiana and Michigan

What is the Role of Debt Management Companies in Debt Collection?

A debt management company is one option for consumers looking for resolution to being over their heads in debt. The business model is relatively simple: the company and the debtor enter into an agreement providing that the management company will negotiate on behalf of the consumer with his or her creditors, seeking to lower payments and interest rates.

According to The Simple Dollar, debt management plans do not normally seek to reduce the actual principal balance of a negotiated debt. Rather, the focus is on adjusting the monthly payment and interest terms.

Nonjudicial Foreclosure is Not Debt Collection Under the FDCPA

In a long-awaited decision, the U.S. Supreme Court on March 20, 2019 held unanimously that when a business initiates an In Rem only nonjudicial foreclosure on behalf of a mortgage lender, the provisions of the Fair Debt Collection Practices Act (FDCPA), with the exception of S 1692f(6), do not apply because the business does not fall under the primary definition of a "debt collector." The decision was limited to the facts situation that the firm of McCarthy & Holthus LLP was only enforcing the Security Instrument and was not attempting to collect on the Note.

Rather, the court reasoned in Obduskey v. McCarthy & Holthus LLP, that In Rem nonjudicial foreclosure actions are instead only security-interest enforcement actions, and the business is not a "debt collector" under the FDCPA, except for the limited purpose of S 1692f(6), which triggers the much narrower set of responsibilities under the FDCPA, as set forth in S 1692f(6). If the Colorado law firm that instituted the nonjudicial foreclosure proceedings had met the primary definition of a debt collector, all responsibilities would have been triggered under the Act.

Four Estate Planning Documents Everyone Needs

Estate plans may not seem like something you need to think about for a long time. Certainly, a will does not become effective until after you pass on, but other estate planning documents can protect your interests while you are still around.

If you become incapacitated, certain documents guide your medical care. Another document allows a responsible party to handle your financial affairs, in case you are unable to do so. Having these documents in place ensures your wishes are carried out correctly. It also prevents your family from having to make tough decisions they may be unprepared to make. Here are the four essential estate planning documents everyone should have to protect their best interests.

What Type of Land Survey Do You Need?

On the game show "Family Feud," the host regularly declares, "Survey says!" The phrase has been around so long it is ingrained in America's cultural consciousness. Unfortunately, this type of survey is of no help when the issue you are dealing with is a major real estate deal in Ohio, Kentucky, Indiana or Michigan.

Indeed, the nature of land deals is of such importance that it has fostered the industry of professional land surveying. And over the centuries, experts have developed an array of survey types to suit the needs of the varying stakeholders in land title and deed transfers: buyers, sellers, lenders, developers, insurers and governments.

As a matter of due diligence, it's important to make sure the survey format used fits all legal requirements. To provide some clarity on the matter, here is a breakdown of common survey types.

Gerner & Kearns' Litigation, Recovery and Collections Department Grows to Three Attorneys

Florence, KY 2/28/19 - Three new attorneys have joined Gerner & Kearns since the start of Q4 last year, bringing the total attorney count for the firm to twelve. Genevieve Campbell joined the firm's Litigation, Recovery and Collections practice group at the end October. Ashlee K. Satterfield started with the firm in December also in the Litigation, Recovery and Collections practice group. Melissa Whalen joined the Default Services practice group earlier this month.

US Supreme Court to Hear Arguments on Important FDCPA Case

The U.S. Supreme Court recently held oral arguments in Obduskey v. McCarthy & Holthus LLP on January 7, 2019. The Supreme Court will decide whether the federal Fair Debt Collection Practices Act or FDCPA applies in a nonjudicial foreclosure action. While courts, generally, accept that the FDCPA covers judicial foreclosures, the lower federal courts are split concerning nonjudicial proceedings.

As background, the FDCPA is a consumer protection law that imposes detailed, specific, requirements on third-party debt collectors throughout the collections process. Therefore, the Supreme Court's decision in this matter will be important to commercial entities that conduct nonjudicial foreclosures (outside of court) on behalf of mortgage lenders. The ability to conduct nonjudicial foreclosure depends on state law. Among the states in which we practice, nonjudicial foreclosure is available in Michigan.

Crucial Estate-Planning Tips for Business Owners

The day-to-day tasks of running a business are all-consuming. You are constantly preoccupied with important business matters in addition to your family life. You may not have stopped to think about estate planning. If you have not taken the steps to create an estate plan, you are making a mistake.

Estate planning is crucial for business owners. A legally sound plan can protect the future of your business as well as address your family's financial needs. If you are a business owner who needs to plan their estate, these are a few simple but important considerations.

PTFA is Back: Lender Duties Toward Tenants Living in Foreclosed Properties

Congress has restored the federal Protecting Tenants at Foreclosure Act of 2009, which had expired under its own terms on December 31, 2014. Effective June 23, 2018, the PTFA creates a process to protect certain tenants residing in foreclosed properties from quick evictions.

Mortgage lenders and default servicers must have a thorough understanding of the PTFA's provisions and ensure as part of their eviction efforts that they create internal procedures for compliance.

New Ohio legislation address financial institution regulation

On December 19, 2018, Ohio Governor Kasich signed Ohio House Bill 489-bringing about changes to regulatory requirements for credit unions, mortgage servicers and mortgage creditors. The new requirements are effective March 20, 2019.

Please see some of most notable changes below.

Seventh Circuit Says Car Repossessor's Fee Did Not Trigger FDCPA

In the recent case of Duncan v. Asset Recovery Specialists, Inc., the U.S. Court of Appeals for the Seventh Circuit, which includes Indiana, looked at whether the Fair Debt Collection Practices Act applied when a vehicle repossession company attempted to charge a $100 fee for returning personal property from a repossessed car to the debtor-owner.

The Act, known as the FDCPA, is a broad, complex federal law that regulates the behavior of third parties.  Third parties can include collection agencies when they collect debts for lenders and other creditors. The FDCPA imposes specific restrictions on how, where and when collectors may contact and interact with debtors. It inherently requires third-party collectors to behave reasonably and truthfully throughout the collection process.

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