Repossession and Trespass

I've written about this before. What I'm going to comment on here is one of the most commonly violated laws on the books. It just applies here in Massachusetts. It's this: A car repossession agent cannot come onto property you own or rent without your permission. It almost every state they can, but they cannot here in Massachusetts. The law can be read right here: G.L. 255B, s. 20B.

This matters in two main ways.

1. If a repossession agent violates Section 20B, the car lender cannot collect a deficiency from you. Car repossession deficiencies can be large and can sometimes drive people into bankruptcy. Say you owe $10,000 on your car loan, and after repossession and sale are credited with the car's value of $5,000: You would owe a deficiency of $5,000 plus repossession and storage fees. However, if the repossession agent came onto your driveway without your permission, the law states that they cannot collect this amount from you. This can be a powerful weapon to combat a deficiency lawsuit.

2. If you confronted the repossession agent on your property and objected to the repossession, there may have been a "breach of peace." This is a specialized term in the repossession world and can entitle you to statutory damages. These damages are usually 10 percent of the amount of the car loan plus the interest charged for the loan. For an average car loan, this amount can be sizable.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

Car Repos in Massachusetts: Police Involvement

Car repossession is a private act and cannot be aided by the police. You have the right to demand that a repossession agent leave your property and not take your car. In turn, they have the right to go to court and get a judge's order compelling you to turnover the car if you are behind in payments. If they have such an order (which is very, very rare), a sheriff or constable, and not the police, will come to your residence to take your car. At this point, because of the judge's order, you do not have the right to object. However, it is very rare that a car lender will have one of these so-called "replevin" orders.

If you decide to order a repossession agent off your property and they refuse to go, you should call the police. But be ready for trouble. Often the police are inadequately trained to deal with repossessions. They will sometimes try to judge the dispute and may even order you to hand over your car keys. This is illegal. Contact us if this happens to you. The job of the police if they come to your residence is to remove the trespasser from your property, not act as a judge in a driveway court.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

Top Complaints from Massachusetts Consumers

Boston.com recently compiled this list of the top consumer complaints in Massachusetts. It's an interesting list because in addition to the perennial favorites--car dealers, home improvement contractors, debt collectors, etc.--two list items relate to foreclosure and loan modification services. It's the wild, wild west right now for those services, with shady operators opening businesses preying consumers needing legitimate relief from burdensome mortgages. Whenever there is a boom in demand for something, scam artists emerge with big promises and flashy ads to trick the credulous public. Be very careful if you are considering answering a TV or radio ad for mortgage-related services. Instead, consider contacting a trusted referral source for a recommendation, or contacting a licensed and insured Massachusetts attorney.

Fraud or Trickery in Massachusetts Car Repossession

As I previously wrote, in the course of a Massachusetts car repossession, it routine (and illegal) for repossession agents to come onto your property late at night, wake you up, and demand your car keys. This is illegal because repo men cannot come onto your property at all or at any time to repossess your vehicle without getting your permission ahead of time.
However, another common illegal practice is that repo agents, when bargaining for your keys, will cross the line and lie to you about what will happen if you don't comply. The ones I have heard most frequently are:
1. We'll damage your car if we have to tow it. First, they cannot tow a car out of your driveway without your permission. Second, they are not allowed to damage your car even if they do. This statement, in itself, subjects a repossession company to liability under the Massachusetts Division of Banks regulations.
2. The creditor will charge you more money if we have to tow the car. Well, taking the car over your objection is illegal in the first place--both as a statutory trespass and a breach of the peace--so as creditor should not be able to impose a charge on your for an illegal act.
3. If you don't give us the keys, we'll just take the car anyway (or call the police). That's a similar threat to those above, but its simplicity and frequency draws attention to a basic fact. A repo agent has no right to do that and due to the the Massachusetts Division of Banks regulations has no right to even make a false threat. If they actually do call the police, this is illegal as a breach of the peace.
False threats, lies, and trickery are not always enough on which to base a case. However, such unlawful act are almost accompanied by others.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

Late Night Car Repossession

Car repossessions in Massachusetts are often done at odd times. Just this past week, we received one call about a repossession at 1:00 a.m. and another at 3:00 a.m. Why do repossessions happen so late? Is this legal? I'll try to answer both of those questions here.
Why are repossessions done late at night or early in the morning when people are sleeping? The industry would likely say that it's because more cars are at people's homes when people are sleeping. This makes some sense. They would also likely say that it is easier to avoid confrontation when people are sleeping. While it is true that cars are most often at home during the night, they are also often home in the early to later evening when people awake but home for the night. Moreover, the notion about it being easier to avoid conflict while someone is sleeping is turned on its head in Massachusetts. Here's why. In Massachusetts, we have a law that says that the repo man cannot come onto property you own or rent to take your vehicle without your permission. Consequently, a repo man will usually wake you up and attempt to get the keys from you rather than simply tow the car from your driveway. That means getting you up out of bed in your pajamas for a late-night confrontation: Hardly a scenario designed to avoid trouble. Even putting aside the issue regarding the time of a repossession: this practice is generally illegal because a repo man needs your permission before he steps onto your property, not after.
So the bottom line is that a repo man cannot come onto your property late at night--or at any other time--to take your car without your permission. However, if your car is parked on the street, there is likely no issue regarding what time of day or night your car is towed away.

You can find more about car repossession law in Massachusetts here.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

Bankruptcy Filings Up 25 Percent in Mass.

Here's the article link.
Bankruptcy filings up 25 percent, year-over-year. "Massachusetts bankruptcy filings spiked 25 percent in the first half of the year when compared to the same period in 2009."

Defense of Marriage Act Declared Unconstitutional

The big legal news of the day is that Judge Tauro of the United States District Court for the District of Massachusetts (Boston) declared the federal Defense of Marriage Act ("DOMA"), 1 USC sec. 7, unconstitutional. The case is styled Gill v. Office of Personnel Management, et al. (link opens .pdf opinion). The case was brought by same-sex spouses married under Massachusetts law. The Court held that "DOMA as applied to Plaintiffs violates the equal protection principles embodied in the Fifth Amendment to the United States Constitution."

On the federal level, DOMA limits the recognition of marital rights to heterosexual spouses. The Court held that Congress' reasons for enacting the law bore no rational relationship to the goals it set. The Court also expressed a strong sentiment that the federal government should stay out of the business of defining marriage because that is the traditional and exclusive purview of the States.

I recently wrote about same-sex spouses and some of the special issues they face in bankruptcy, such as that DOMA has been interpreted to bar such spouses from filing joint bankruptcy petitions which, among other things, increases the overall cost of bankruptcy. That may change now, and I would like to bring a test case if presented with the right clients. Judge Tauro's opinion is not binding on the bankruptcy court and it may yet be appealed. However, it broke new ground and will carry considerable weight when used to support a challenge to a joint bankruptcy petition on behalf of same-sex spouses.

Bankruptcy Meeting Locations in Massachusetts

All bankruptcies involve a court meeting. Where that meeting takes place depends on the place you live at the time your bankruptcy case is filed. It's sadly a little confusing, and people ask about it all the time, so I'll set it all out here as clearly as possible.

Chapter 7 cases, Boston:
If you live in Suffolk or Norfolk County, you will have your court meeting in Boston.
If you live in Essex County, but not in Andover, Boxboro, Bradford, Haverhill, Lawrence, Methuen, or North Andover, then you will also have your meeting in Boston.
If you live in any of the following towns in Middlesex County you will also have your meeting in Boston: Arlington, Ashland, Belmont, Burlington, Cambridge, Everett, Framingham, Holliston, Lexington, Lincoln, Malden, Medford, Melrose, Natick, Newton, North Reading, Reading, Sherborn, Somerville, Stoneham, Wakefield, Waltham, Watertown, Wayland, Weston, Wilmington, Winchester and Woburn.
Chapter 7 cases, Brockton:
If you live in Plymouth, Bristol, Barnstable, Dukes, or Nantucket county, you will have your court meeting in Brockton.
Chapter 7 cases, Worcester:
If you live in Worcester county, you will have your court meeting in Worcester.
If you live in Andover, Boxboro, Bradford, Haverhill, Lawrence, Methuen, or North Andover (in Essex county), you will have your court meeting in Worcester.
If you live in any town in Middlesex county except for those listed above, you also will have your court meeting in Worcester. This is the one that gets people because quite a few towns relatively close to Boston end up getting assigned to Worcester (Concord, just for example).
Chapter 13 cases:
Chapter 13 cases are just the same as Chapter 7 cases except that no one goes to Brockton. If you would be assigned to Brockton, you are just assigned to Boston.

That's all. There are other rules involving Springfield, Pittsfield, etc., but I have not idea what these are we do not practice in Western Mass.
The specific meeting locations in Boston, Brockton, and Worcester change from time to time. Current information about the bankruptcy court locations in Massachusetts can be found via a google search or by clicking on the link in this sentence (which goes to our main bankruptcy web site).

Bankruptcy Issues for Same-Sex Spouses

We have represented many same-sex couples in bankruptcy throughout the years, before and after the landmark decision in Goodridge v. Department of Public Health which provided legal recognition to same-sex marriage in Massachusetts. Despite this decision, there continues to be several special issues in same-sex bankruptcy cases.

Bankruptcy is a federal proceeding and same-sex marriage is not recognized on a federal level. See Defense of Marriage Act. This means that same-sex spouses cannot file joint bankruptcy petitions. The impact of this is primarily technical: One can get the same relief with two petitions as with one. Also, here in Massachusetts, if two bankruptcy cases are filed simultaneously, the creditor meeting for each will be assigned the same date, time and trustee. This allows same-sex spouses to experience the creditor meeting together, though--unlike in the case of heterosexual couples--they will still be examined under oath individually.

One significant drawback to the treatment of same-sex spouses in bankruptcy is that the cost of two bankruptcy cases is always higher than for one case. However, it has been my experience that same-sex spouses tend to have less joint debt than heterosexual couples (although this may change with time). Consequently, if only one spouse has debt problems, it may be advisable for just that spouse to file bankruptcy. This is a right that all married people have, which may be more often advantageous for same-sex spouses.

Means testing for same-sex couples:
There isn't any real difference in how a means test is formulated for roommates, same-sex couples, straight couples, or anyone else. There are differences with how the forms are filled out, but those are just details. The crux of it is that both spouses are counted in household size for the means test and then any contribution to the debtor's household expenses from the other spouse is also included. This is essentially what happens in a traditional joint case. The mechanics are different, but in a way that benefits gay spouses: the non-filing spouse's total income does not need to be included and then diminished by the so-called "marital adjustment." For a same-sex spouse the non-filing spouse's actual net household contribution need only be listed on the means test.

P.S. I wrote a post a few days after this one reporting on how one Massachusetts (federal) judge declared the Defense of Marriage Act unconstitutional. It can be viewed here.

Options After Your Car is Repossessed in Massachusetts

Here are a few practical tips for what to do after your car is repossessed. What I write here only pertains to Massachusetts because car repossession law is a state-specific matter in almost all respects.
First of all, you're probably distressed if your car was repossessed. That's understandable. You might need your car to get to work, or you might have thought you had more time, your car might have been taken during the dim hours of the night or early in the morning and involved some sort of drama. However, what to do next? Here are some thoughts in question and answer format.

1. Have my rights been violated? Maybe. There are two main ways we see in which rights are violated during repossession. First, you may have not received the required 21-day written notice called "Rights of Defaulting Buyer under the Massachusetts Motor Vehicle Installment Sales Act" before your car was seized. Second, the repossession company may have breached the peace in the course of the repossession. Breaching the peace can mean threats, coercion, and other oppressive acts committed during a repossession. I wrote a bit more about that here.

2. So what if my rights were violated? This is a really good question. Laws only have meaning when people can actually enforce them. The criminal laws are enforced by the police, but individuals have to enforce their own rights under civil law. The repossession laws I am writing about are civil laws.

3. So are these rights enforceable? The really good news is that they often are because other laws exist (such as the Massachusetts Consumer Protection Act) that help people who can't even make their car payments afford expensive attorneys. These laws require the wrongdoers to pay your attorney's fees if you are successful in pressing your rights.

4. But what about the car? Can I get my car? This is not the easy part because the laws I mention above primarily function to get you money damages for wrongful repossession. So, the most common approach if you want your car is to call the car lender ASAP after repossession and agree to pay whatever they want. After doing that you can still sue the car lender for money damages. There is, in general, a 20-day period that you have to "redeem" a repossessed car. Sadly, this is one of oft-ignored laws in the repossession field. So, if you want your car, act as quickly as possible.

5. What can they make me pay to get the car back? The answer is the whole amount of the loan. That's right. However, that is only if the repossession wasn't wrongful--they sent you the 21-day notice, peaceable repossessed the car, etc. The bad news is that, whether or not the repossession was actually wrongful or not, the car lender will always think they've done everything perfectly and that their company is absolutely infallible. So, be nice--even though they do not think they have to, they will often let you have the car back for just the back payments and repossession/storage fees. As I said, you can still sure them for damages afterwards if the repossession was wrongful.

6. What if I can't afford to pay what they are asking? This is pretty common. The options are not too good here, at least for getting the car back. One option: you can file for bankruptcy within the 20-day redemption period and get the car back. Another option: you can quickly file a lawsuit in state court for what is called replevin (and money damages). The state court replevin option is not very common.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

Massachusetts Car Repossession--Consent

I posted previously on car repossession procedures here in Massachusetts. I wanted to address something of a murky and misunderstood area. Massachusetts law provides that a lender can only repossess a vehicle after giving certain notices (i.e., the "Rights of Defaulting Buyer under the Massachusetts Motor Vehicle Installment Sales Act") after default. Moreover, the lender must not use force or breach the peace in taking the vehicle. The lender is also prohibited from entering onto property owned or leased to the debtor and taking the vehicle without the debtor's consent.

Cars are often parked in driveways and these driveways are, obviously, part of the debtor's owned or leased property. However, repossession companies routinely take cars from driveways. They often attempt to obtain and usually succeed in obtaining a sort of coerced consent from the debtor in this way: the repo guy will often say that if you don't give him the keys, your car will be damaged, or lie and say that you have to give him the keys. He might also start a disturbance to embarrass the debtor into complying. Since repossessions often happen late at night or the in the early morning, and the people doing the repossessing are often experienced in the subtle and arts of intimidation, this is often effective. The bottom line is that a lender can't take a car from a driveway if the debtor does not allow it. If they don't get consent, they must take the car from public property or get a court order allowing them to take it from the driveway.

Now, there's no point in unnecessarily delaying the inevitable: if you can't pay your car loan, the lender has a right to the car. However, there are rules for a reason--to maintain peace and good order--and if these rules are broken there are consequences, including at times significant statutory damages for the debtor. So, you might want to consider keeping the keys if a repo man visits your driveway in the middle of the night.

*Note: If your car has been repossessed in Massachusetts, we might be able to help. However, due to high call volume after I posted information here about Massachusetts car repossession, we must first receive the completed form found here: http://www.mass-legal.com/repo_quest.asp. We will review your matter confidentially and free of charge.

New Means Test and Median Income Numbers

For bankruptcy cases filed after March 15, 2010, new means test and median income figures apply. The details are available here: http://www.justice.gov/ust/eo/bapcpa/20100315/meanstesting.htm

New Dollar Amounts in Bankruptcy

For bankruptcy cases filed after April 1, 2010, new dollar amounts will apply. The list of changes can be viewed here: http://www.bkmass.com/misc/output.pdf. The most notable increases are the Chapter 13 debt limits, the dollar amounts of the federal exemptions, and the homestead cap (increased to $146,450).

New Rules for Mortgage Modifications in Massachusetts Bankruptcy

Today, the Massachusetts Bankruptcy Court issued an emergency standing order rendering void provisions in proposed loan modifications that state that the automatic stay will be lifted or waived upon default of the debtor. The order can be viewed here: http://www.mab.uscourts.gov/pdfdocuments/so10_02.pdf. This is a good rule. Debtors are often desperate for loan modifications in bankruptcy and will agree to anything that lowers their loan payment. The new rule prevents them from bargaining away the automatic stay if they default on their loan modification payments.

List of HAMP Mortgage Servicers

Wondering if your mortgage loan servicer is participating in the HAMP program? A list can be found here:
http://www.financialstability.gov/impact/contracts_list.htm

Home Affordable Modification Program: Introduction

The Home Affordable Modification Program ("HAMP") is a 2009 creation of the Obama Administration. The program provides for government payments to participating mortgage loan servicers in exchange for reductions in mortgage payments for eligible borrowers. The point is to reduce mortgage payments to a 31 percent debt-to-income ratio. Participating servicers are required check all mortgages that are more than 60 past due and loans for borrowers who ask for a modification and can represent that they face an imminent risk of default. Once a borrower is introduced into the program, any pending foreclosure must stop. A three-month trial period with a new, lower loan payment begins, often based on only a verbal commitment (although this will require more formal documentation starting in mid 2010). During the trial period, income and other documentation are verified. After the borrower makes three monthly payments, the trial loan is moved to permanent status.
A fact page can be found here:
https://www.hmpadmin.com/portal/programs/hamp.html