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I assume filing for bankruptcy means the lender gets to claim the medallion and sell it? That means losing potentially hundreds of thousands in payments already
by jazzkingrt 7y ago
I assume filing for bankruptcy means the lender gets to claim the medallion and sell it?
That means losing potentially hundreds of thousands in payments already made, as well as the loss of any source of income. I think renting a medallion is possible at that point, but many of these medallion owners seem to have invested their life savings and could be nearing retirement.
- pfisch 7y agoWell maybe people shouldn't be investing their life savings in a single asset...
- bko 7y agoYes, that's true, but considering that many of the loans were interest only or very long term, the driver did not sink much into the principal. It's kind of weird that the author is so critical of these types of loans when they are very beneficial if the asset value dropped a lot, since now the lender is stuck holding the bag.