A Federal Reserve report shows that mortgage lending jumped to a five-year high last year, driven by a sharp rise in refinancing as borrowers rushed to lock in the lowest mortgage rates in at least 60 years, the Wall Street Journal reported today. The report, which was released yesterday by central-bank researchers, found that lenders originated nearly 9.8 million mortgages in 2012, up 38 percent from 7.1 million in 2011, which had been a 16-year low. Last year's levels, however, remained far short of lending volumes reached during the housing bubble and even before the bubble over a decade ago. Nearly 6.6 million loans were to refinance existing mortgages, up 54 percent from 2011 and the highest level since 2005. While lending for home purchases increased 13 percent to 2.7 million mortgages in 2012, it remained below the level reached in every year between 2000 and 2009. Read more. (Subscription required.)
REPUBLICAN CONGRESSMEN LOOK FOR ANSWERS ON CFPB DATA-MINING, BANKRUPTCY FILES
Two key congressional Republicans want answers from the Department of Justice about a controversial consumer credit card data-mining operation at the Consumer Financial Protection Bureau, the Washington Examiner reported today. Sen. Chuck Grassley (R-Iowa) and Rep. Spencer Bachus (R-Ala.) also want to know if the CFPB has harmed the U.S. Trustee Program by improperly using it to capture millions of bankruptcy case files. The Grassley and Bachus questions follow news reports that the CFPB's data-mining program seeks to capture 80 percent of all U.S. consumer credit card transactions and 95 percent of all mortgage transactions. In a Sept. 17 letter to Attorney General Eric Holder, Grassley, the Ranking Republican on the Senate Judiciary Committee, said that he is concerned that the USTP "acted on behalf of the CFPB to collect personal financial data that the CFPB had otherwise been unable to obtain." Read more.
DETROIT RESIDENTS TO VOICE PENSION FEARS TO BANKRUPTCY JUDGE
After weeks of listening to lawyers, the judge in Detroit's bankruptcy devoted a hearing today to listening to worried residents of the financially stricken city, the Wall Street Journal reported today. Bankruptcy Judge Steven Rhodes granted an unusual audience to 93 people, most of them retired city workers who fear that the chapter 9 case will mean Detroit won't pay their pensions in full, but also some with other grievances. They are seeking to block the city's bid for chapter 9 protection, which would allow it to restructure an estimated $18 billion in liabilities. According to a draft restructuring plan released in June, Detroit offered to pay about $2 billion to cover $11 billion in unsecured debt. That includes about $3.5 billion in pension obligations, although the city has indicated that it is likely that pensions will be cut under the plan. Read more. (Subscription required.)
COMMENTARY: AMERICA'S SINKING MIDDLE CLASS
The Census Bureau said on Tuesday that the typical household last year made $51,017, roughly the same as the typical household made a quarter of a century ago, according to a commentary today in the New York Times. In key respects, according to the commentary, the standard of living of most Americans has fallen. Health care spending per person, adjusted for inflation, has roughly doubled since 1988, to about $8,500 -- pushing up health insurance premiums and eating into workers' wages. The cost of going to college has been rising faster than inflation, as well. About two-thirds of people with bachelor's degrees relied on loans to get through college, up from 45 percent two decades ago. In contrast to people in other developed nations, who have devoted more time to leisure as they have gotten richer, Americans work about as much as they did a quarter-century ago. Despite all this toil, the net worth of the typical American family in the middle of the income distribution fell to $66,000 in 2010 -- 6 percent less than in 1989 after inflation. Read more.
BLOOMBERG'S LATEST "BILL ON BANKRUPTCY"
VIDEO: SEX DOESN'T SELL ENOUGH TO AVOID BANKRUPTCY
There's so much sex on the Internet that a website where adults hook up couldn't avoid bankruptcy. Bloomberg Law's Lee Pacchia and Bloomberg News bankruptcy columnist Bill Rochelle discuss the chapter 11 filing by FriendFinder Networks Inc., publisher of Penthouse. To watch the video, please click here.
ETHICS CLE: NEXT WEEK'S ABILIVE WEBINAR EXAMINES THE COMPLEX REQUIREMENTS AND ETHICAL DUTIES OF REPRESENTING CONSUMER DEBTORS
The abiLIVE webinar on Sept. 24 will feature a panel of experts discussing the ethical and compensation issues that can arise while representing chapter 7 and 13 debtors as well as individual chapter 11 debtors. Topics covered include client fraud and an attorney's duty to verify client information, attorney fee structures, and complex issues in individual chapter 11 cases. The panel includes perspectives from the attorneys and trustees, as well as the academic reporter for the ABI Ethics Task Force. Click here to register.
NEW ABILIVE WEBINAR OCT. 3: THE INTERSECTION OF INTELLECTUAL PROPERTY AND BANKRUPTCY: KODAK, NORTEL AND OTHER CASES
IP experts will shed light on the mysteries of understanding IP law and navigating the often puzzling sales processes, drawing from their experiences in Nortel, Kodak and other important cases, in an abiLIVE webinar on Oct. 3 from 1:00-2:15 p.m. ET. Speakers will include David Berten (Global IP Law Group, LLC; Chicago), Pauline K. Morgan (Young Conaway Stargatt & Taylor, LLP; Wilmington, Del.), Cassandra M. Porter (Lowenstein Sandler LLP; Roseland, N.J.), Kelly Beaudin Stapleton (Alvarez & Marsal; New York) and Christopher Burton Wick (Hahn Loeser & Parks LLP; Cleveland). To register, click here.
RECORDING AVAILABLE OF THE ABILIVE WEBINAR EXAMINING THE NEW U.S. TRUSTEE FEE GUIDELINES!
If you were not able to join ABI's recent well-attended abiLIVE webinar examining the U.S. Trustee Fee Guidelines for chapter 11 cases filed on or after Nov. 1, a recording of the program is now available for downloading! A panel of experts, including Clifford J. White, the director of the U.S. Trustee Program, discussed some of the ways the new guidelines could change day-to-day operations in firms, issues relating to the new market rate benchmarks, and how these changes might alter insolvency practice. The 90-minute recording is available for the special ABI member price of $75 and can be purchased here.
ABI GOLF TOUR UNDERWAY; LAST STOP FOR 2013 IS WINTER LEADERSHIP CONFERENCE IN DECEMBER
The 7th and final stop for the 2013 ABI Golf Tour is on Dec. 5 at the Trump National Golf Club, held in conjunction with ABI’s Winter Leadership Conference. Final scoring to win the Great American Cup sponsored by Great American Group is based on your top three scores from the seven ABI events. See the Tour page for details and course descriptions. The ABI Golf Tour combines networking with fun competition, as golfers "play their own ball." Including your handicap means everyone has an equal chance to compete for the glory of being crowned ABI's top golfer of 2013! A 22-handicapper won the tour event at July’s Southeast Bankruptcy Workshop. There's no charge to register or participate in the Tour.
NEW CASE SUMMARY ON VOLO: AUTOMOTIVE FINANCE CORP. V. MORSE (IN RE MORSE; 1ST CIR.)
Summarized by Michael Cooley of Akin Gump Strauss Hauer & Feld LLP
In a brief ruling, the First Circuit Bankruptcy Appellate Panel concluded that the bankruptcy court erred in granting summary judgment in favor of the plaintiff on the nondischargeability of its claim under 11 U.S.C. § 523(a)(6). Noting that the "threshold question" of whether the creditor was entitled to relief under § 523(a)(6) as a matter of law was not raised below or addressed in the briefs, the panel concluded that, in an open, pending chapter 13 case, such relief is expressly excluded by § 1328(a)(2). The case was reversed and remanded with instructions to dismiss without prejudice.
There are more than 1,000 appellate opinions summarized on Volo, and summaries typically appear within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI’s Volo website.
NEW ON ABI’S BANKRUPTCY BLOG EXCHANGE: LONG-OVERDUE HOUSING FINANCE REFORM WITHIN GRASP
The Bankruptcy Blog Exchange is a free ABI service that tracks more than 80 bankruptcy-related blogs. A recent blog post features a commentary by Sens. Bob Corker (R-Tenn.) and Mark Warner (D-Va.), authors of legislation looking to modernize the U.S. housing finance system, that outlines the steps forward for housing finance reform.
Be sure to check the site several times each day; any time a contributing blog posts a new story, a link to the story will appear on the top. If you have a blog that deals with bankruptcy, or know of a good blog that should be part of the Bankruptcy Exchange, please contact the ABI Web team.
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