Taxi medallion owners face overwhelming challenges these days. After they make their loan payments and operating expenses, they have nothing left to support their families. While Chapter 7 bankruptcy (surrender your medallion and wipe out your debts) works if you have no other assets, there are times when filing Chapter 7 creates too much risk.
You really want to continue driving but you are having trouble making the note payments. If you own a house with your wife in New York, and have less than $330,000 in equity above the mortgage, bankruptcy might be an option. Educate yourself about bankruptcy. Then call to develop a customized strategy.
A taxi medallion owner, searching the Internet for options, called. "I heard you were helping a lot of people."
When the market was high, he decided to cash in on his long hours and hard work to protect his family for the future. The bank offered him a refinance to obtain $300,000. He used it to buy an investment property, to generate income for his retirement.
His loan had matured last year and the bank presented him with a six-month extension, while they evaluated a new loan. He couldn't decide what to do.
He retired several years ago and leased out his medallion to the garage, which got him drivers and a steady stream of income to pay his note, with change to spare.
Years ago when he refinanced his loan, he signed all documents requested at the closing. One of the documents was a "Waiver of Right to an Attorney". Another was a "Confession of Judgment". He didn't really understand what it meant.
"I got your name last night at Kennedy Airport while the drivers were talking, waiting for fares. Someone else had been to see you and gave me your number."
To minimize their own risks, banks, credit unions and other lenders are now trying to be gentle with their borrowers at refinance time. They have been offering deals that sound good at first, such as longer terms, lower interests rate, or lower monthly payments.
They bought two taxi medallions as a safe investment for retirement, then leased them out. At first, their expectations, based upon actual experiences of their friends were good. The lease payments they received allowed them to to pay the loan they had taken out to buy the medallions, leaving a surplus for savings or spending.