Timing Matters. Stay Ahead with Credit Chronometer.

Economic, market and political events shape the legal landscape and impact loan and credit markets, each time moving us closer or farther away from a cycle’s end, a crisis’ beginning or the next boom. From the perspective of lawyers and other professionals who have lived through past cycles, the Credit Chronometer™ is dedicated to analyzing the effects of these events on future performance and participants’ legal exposure.

Certain markets warrant special attention due to risky practices, an evolving regulatory environment or dynamic market forces.

Main Markets Covered

auto Loans

Trends in subprime auto lending and related ABS have evoked comparisons to the subprime mortgage meltdown. Where many see an imminent crisis, others point to significant differences to pre-financial crisis subprime mortgage market and RMBS. To shed light on the issue, the Credit Chronometer has identified the main indicators of crisis – within lending practices, securitization practices and the underlying market for the assets backing the pooled loans – that foreshadowed the fall of subprime mortgages and analyzes subprime auto lending using a disciplined comparative approach.

The Subprime Auto Loan Crisis Chronometer provides a quick view of risk in the market based on the indicators of crisis and their prevalence in subprime auto lending and ABS today.

marketplace lending

Marketplace lending, sometimes referred to in various forms as peer-to-peer, P2P or online lending, has been marked by a meteoric rise and fall to earth in 2017. Lending platforms and ABS transactions continue to be shaped by advances in fintech, regulatory uncertainty and recent major legal decisions regarding “true lender,” “valid when made” and the application of usury laws. A technologically savvy consumer base creates the potential for marketplace lenders to outperform their traditional counterparts. The Credit Chronometer offers in-depth analysis and advice for avoiding the pitfalls that have historically led to shorter growth cycles and battles over loss distribution.

student loans

With the sky-high cost of higher education and vocational training, student loans now make up over 10% of total household debt. Delinquency rates have been rising, outpacing delinquencies on credit cards, auto loans and mortgages. The Credit Chronometer has identified issues with student loan servicing, collection and enforcement practices that echo the subprime mortgage crisis and may be contributing to the student loan debt crisis. As the servicers and holders of student loan debt become subject to similar claims and investigations as those involved in subprime mortgage lending, the Credit Chronometer provides insight that helps separate fact from fiction.

mortgage loans and Mbs

Pre-financial crisis subprime RMBS litigation may be entering a new phase, moving on from fraud and repurchase actions brought by investors against sponsors and sellers to new actions by deal participants to recoup litigation losses from one another. The risk of new government actions and investigations continues. The Credit Chronometer identifies litigation trends and the merits of potential claims.

After a long dormancy, subprime RMBS has made a comeback. The Credit Chronometer is on the lookout for history repeating itself and identifies best practices to avoid issues of the past.

PACE financing

Property Assessed Clean Energy (PACE) financing is one of the fastest growing, and most controversial, type of financing, in which environmentally efficient home improvements are repaid through an assessment on the real property. Issues exist for all participants: borrowers, who are unaware of their repayment obligations; local governments, who are tasked with reporting defaults and enforcing obligations owed to private lenders; investors, who are often in the dark as to borrower defaults; and lenders, who face uncertain rules and regulations. The survival of the industry may soon require a significant shift in practices. The Credit Chronometer closely follows all aspects of this dynamic market and analyzes the issues from the perspective of past turning points and industry shifts.


Joseph Cioffi | Primary Author

Joseph Cioffi is a partner at Davis & Gilbert in New York City where he is Chair of the Insolvency, Creditors’ Rights & Financial Products Practice Group, a multidisciplinary practice spanning transactional work, insolvency and litigation. Joseph has written for or has been quoted by numerous publications, including American Banker, Law360, Asset Securitization Reporter, The Banking Law Journal, The Journal of Bankruptcy Law and Auto Finance News, regarding auto loans, student loans, PACE (Property Assessed Clean Energy) loans, marketplace lending and subprime residential mortgage-backed securities (RMBS). Joseph has a unique perspective afforded by his experience in all stages of credit and market cycles – from cradle to grave – including in subprime lending operations and RMBS litigation and defense of fraudulent transfer actions brought by the trustee for the liquidation of Bernard L. Madoff Securities LLC. For Joseph’s full background, click here.

James R. Serritella

James R. Serritella is a partner in the Insolvency, Creditors’ Rights & Financial Products Practice Group of Davis & Gilbert and his practice focuses on complex litigation in the financial services sector, bankruptcy litigation and insurance recovery on behalf of policyholders. James has also written for several publications, including Pratt’s Journal of Bankruptcy Law and The Banking Law Journal. In recognition of his achievements, James was selected as a Rising Star by New York Metro Super Lawyers (2015-2018). For James’ full background, click here.

Seiji Newman

Seiji Newman is counsel in the Insolvency, Creditors’ Rights & Financial Products Practice Group of Davis & Gilbert. Seiji’s practice focuses on complex commercial litigation, including disputes relating to the financial services sector, class actions, bankruptcy, residential mortgage-backed securities (RMBS), and real estate. He practices in both trial and appellate courts, representing a wide spectrum of clients as both plaintiff and defendant. For Seiji’s full background, click here.

Massimo Giugliano

Massimo Giugliano is counsel in the Corporate and Insolvency, Creditors’ Rights & Financial Products Practice Groups of Davis & Gilbert. Massimo advises financial institutions and service sector businesses in connection with a broad range of insolvency-related matters and credit transactions. In recognition of his achievements, Massimo was selected as a Rising Star by New York Metro Super Lawyers (2016-2018). For Massimo’s full background, click here.

Insolvency, Creditors’ Rights & Financial Products Group

Davis & Gilbert’s Insolvency, Creditors’ Rights & Financial Products Practice Group represents clients in a broad range of corporate finance, insolvency and litigation matters. The group regularly prosecutes and defends litigation involving complex financial instruments, guides clients through financially distressed situations and helps formulate and execute creditor enforcement strategies, including foreclosure under the Uniform Commercial Code. The group also advises on a full range of financing transactions, including secured revolving and term credit facilities, receivable financing arrangements, intercreditor agreements, warehouse lending facilities and loan purchase agreements.Their practice covers a wide range of litigation involving financing transactions and complex financial products. The broad and diverse experience of their attorneys, who come from litigation, bankruptcy and corporate backgrounds, makes them particularly well-equipped to advise clients in rapidly evolving industries, such as, marketplace lending, auto loans, student loans and PACE (Property Assessed Clean Energy) loans.

The group has been actively involved in many of the most notable and highly visible business events in recent years related to the last economic downturn and have vast experience in the area of residential mortgage lending from the operation of origination platforms to defending repurchase (put-back) and fraud actions in residential mortgage-backed securities (RMBS) litigation. For more information about the Insolvency, Creditors’ Rights & Financial Products Practice Group, click here.

Davis & Gilbert LLP

Davis & Gilbert LLP is a strategically focused, full-service mid-sized law firm of more than 130 lawyers. Founded over a century ago and located in New York City, the firm represents a wide array of clients – ranging from small, independent start-ups to some of the world’s largest public companies and financial institutions – throughout the United States and internationally. Davis & Gilbert has practices focusing on Corporate; Litigation; Real Estate; Intellectual Property; Insolvency, Creditors’ Rights & Financial Productions; Taxation; Benefits & Compensation; Labor & Employment; Private Client Services; Advertising, Marketing & Promotions; Digital Media, Technology & Privacy; and Entertainment, Media & Sports. Davis & Gilbert is ranked in publications and legal directories such as Chambers USA, The Legal 500 United States, and “Best Law Firms” by U.S. News & World Report – Best Lawyers®, and is consistently recognized in The BTI Consulting Group’s “Client Service A-Team” (2012-2018).