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To help those burdened with student loans, several members of Congress introduced legislation in April of 2010 that would treat private student loans the same as other consumer debt. Entitled “The Private Student Loan Bankruptcy Fairness Act,” the legislation would be a major change, permitting people who file for bankruptcy to discharge private student loan debt – something rarely possible in the past. A Kansas City bankruptcy attorney can help you understand bankruptcy laws regarding student loans and other types of debt if you are experiencing financial difficulties. Discharging Student Debt and the Undue Hardship Requirement In 2008, only 0.4% of federal student loan borrowers who filed for bankruptcy even attempted to discharge their student loan debt. The website FinAid estimates that less than 1% of private student loan borrowers in bankruptcy attempt to seek a hardship discharge of that obligation, and less than half of those people are successful….
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It comes as news to many during these tough economic times that by filing for bankruptcy, individuals can be released from liability for most unsecured debts, prevent creditors from taking collection actions, and save a home from foreclosure as well. While Chapter 7 bankruptcy discharges your legal obligation to pay most unsecured debts, Chapter 13 bankruptcy allows repayment of past due debts over time, preventing creditors from repossessing secured property on which payments are being made. Under the present laws, filing either a Chapter 7 or a Chapter 13 bankruptcy stops a home foreclosure, and allows the homeowner time to cure the mortgage arrearage. An experienced Kansas City bankruptcy attorney can explain how, under either Chapter 7 or 13, bankruptcy can help save your home. Chapter 7 is a temporary stop to the foreclosure, but might give the individual or family a short time to cure the past due balance,…
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Kansas City Bankruptcy Attorneys Analyze a Potential Solution It has been a few years since Occupy Wall Street reached its zenith, and one offshoot of the movement is still working to represent the needs of the 99 percent. Rolling Jubilee, a group formed by former Occupy activists, is paying large portions of students’ unforgiven debt. A recent NPR article describes how one student received a letter in the mail explaining that $790.05 of her debt had been covered by Rolling Jubilee. What Can I Do About my Student Loan Debt? So far, the group has covered $15 million worth of student loan debt across the nation. The group, which has Christian ties, says that the word “jubilee” refers to Biblical times: every 49 years, a “jubilee” occurred that erased everyone’s debt. Considering that Americans owe a total of $1.2 trillion in student loan debt, Rolling Jubilee members have their work…
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Under the 2005 changes to the bankruptcy rules, the first step in figuring out whether you can file under Chapter 7 is to measure your “current monthly income” against the median income for a family of your size in your state. This is called the “means test.” A qualified Kansas City bankruptcy lawyer will be aware of the requirements and can help you. If your income is less than or equal to the median, you can file for Chapter 7. Importantly, if your debts are primarily business related, the means test may not apply to your ability to file Chapter 7. If your income is more than the median, you must pass the “means test” in order to file for Chapter 7. The purpose of the means test is to ascertain whether you have enough disposable income, after subtracting certain allowed expenses and required debt payments, to repay at least…
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