Taxi Medallion Loans Will Reset To $200K, Helping Drivers In Debt

NEW YORK CITY — Taxi drivers strapped with debt after buying medallions from predatory lenders soon will benefit from a sharp reduction in their loan payments.

A deal Wednesday between city officials, the New York Taxi Workers Alliance and medallion lender Marblegate Asset Management will restructure outstanding medallion loans for a max price of $200,000.

The deal comes after a month of daily strikes and a 15-day-long hunger strike by NYTWA members and allies who were demanding debt relief from medallion loans.

"BREAKING NEWS: 2 words: WE WON!!!!" tweeted the NYTWA's official Twitter account.

Mayor Bill de Blasio, whose administration has often been at odds with taxi drivers, praised the deal Thursday. He commended Senate Majority Leader Chuck Schumer for paving the way on the deal.

"It is a victory for working people," de Blasio said.

Schumer said city officials and taxi drivers had reached an impasse after an initial $65 million deal to help cover their debt. The two sides disagreed over a backstop, he said.

He called de Blasio to impart a Beatles-inspired message: "We can work it out."

"The taxi drivers are going to have to pay a lot of money each month, but it will be at least money they can afford," he said.

The crisis for taxi drivers started in the early aughts, when lenders sold medallions at artificially inflated prices that saddled them with massive debts as Uber and Lyft took off in the city.

Per the deal, new loan terms will include a 5 percent interest rate and a 20-year, fully amortizing term — meaning if medallion owners make every payment according to their original schedule, their loan will be fully paid off after 20 years.

The restructuring will cap debt service payments at $1,122 per month for "eligible medallion owners."

Officials announced the restructuring almost eight months after the city took its first steps to reducing taxi drivers' debt, as in March when Bill de Blasio announced the creation of a $65 million Medallion Relief Program.

The deal will give taxi drivers made up of a $170,000 guaranteed loan and a $30,000 city grant.

Through the program, medallion owners could receive up to $20,000 in up-front loans to restructure their medallion debt with an additional $9,000 in payment support, and could pay back the money at 0 percent interest.