NEW YORK–A group of “taxi advocates” here is claiming one credit union taxi medallion lender is driving cab drivers to the “brink of suicide” by not being more amenable to reworking loans.
David Beier, president of the Committee for Taxi Safety, sent a letter to Melrose Credit Union in which he called on it to stop raising interest rates, shortening loan terms and demanding balloon payments, according to the New York Post.
“Melrose has continued to go after responsible medallion owners who want to pay off their debt but are having a hard time doing so because of the market pressures created by Uber, Lyft and other ridesharing companies,” Beier stated in the letter. “The precipitous drop in the value of the taxi medallions — going from a high of $1.3 million to a low of $160,000 — is mainly why medallion owners are struggling.”
Melrose Credit Union was placed under conservatorship by NCUA in 2017 and remains open and operating.
According to the Post, cab driver Nicanor Ochisor, who hanged himself in his garage last week, was a member of Melrose Credit Union. The Post quoted friends of Ochisor as saying he was struggling financially and that he had a balloon loan payment due to Melrose in February.
Ochisor was the first medallion owner and fourth industry driver to commit suicide in the past four months, as the value of medallions has plunged, the Post reported. “Many medallion owners who purchased them for lower prices had used their increase in value to refinance and take money out for expenses such as homes, vacations or sending kids to college,” the report noted.
Over the past six years approximately 70,000 Uber and Lyft drivers have taken to the roads in New York City, greatly increasing competition for taxis.
Since being placed under conservatorship, the situation for members who have outstanding loans with Melrose Credit Union has only gotten more difficult, New York Taxi Workers Alliance Executive Director Bhairavi Desai told the Post.
“It’s more strict than anything we’ve ever seen,’’ Desai was quoted as saying. “They are not negotiating lower interest rates and are now requiring the owners put personal property like their homes up as collateral. This is ruining drivers’ lives.”