Student loans are the second highest debt category for consumers. Only mortgages surpass this. However, student loans usually can't be discharged in bankruptcy. The reason for this is that a person has to pass the Brunner test if they are going to have the student loans forgiven through bankruptcy.
Medical bills can be quite costly and can lead to very serious financial issues. Even if you have wonderful insurance, some items that aren't covered might lead to troubles. If you are in this position, there is only so much else you can cut back on so that you can pay the medical bills. Once you have cut things down and don't have anything left that will help you to save money, you might have to look at other options.
Realizing that you have more debt than you can handle is a frightening event. There are two things that you can do. One of these is that you can ignore it and hope that it all goes away. The second is that you can work to have the debts taken care of. If you choose the more responsible option, trying to take care of the debt, you might choose to look into the option of filing for bankruptcy.
Some people don't want to file for bankruptcy because they see it as a failure. They think that they are shirking their duty to pay off the debts they owe and that it will have a negative impact on the economy. This isn't the case.
A recent report by a commssion studying bankrutpcy laws found that the cost of bankruptcy is a problem for many individuals. The current law provides that bankruptcy fees must be paid before filing. This makes it difficult for some debtors to come up with the money to file. A particular debt that haunts some people who file for bankruptcy is student loan debt. The problem with this type of debt is that unless you can show that you have remarkable financial hardship, you will still have to repay this debt. The commission found that the bankruptcy laws on student debt should also be changed.
When you are laid off from work, suffer a serious medical issue or have another life catastrophe, your finances might suffer. Bills that were once routinely paid might be impossible to afford now. You may have to choose between paying a bill or buying groceries for dinner. This isn't a good place for anyone to be in, so it is imperative that you take steps to shore up your finances so you don't suffer a lifetime of problems because of your current money situation.
It is imperative that anyone who is considering filing for bankruptcy takes the time to think carefully about what it means to file. There are several ways that this can impact your life now and into the future. One of the most important to many people is that the filing temporarily halts the ability of your creditors to try to collect the balances on your accounts. This is because the court issues an automatic stay when you file for this type of financial relief.
Now that things have settled down after the holiday season, you might have bills rolling in for the purchases you made. You might have been able to pay easily in January and February, but maybe things are really tight now and it doesn't look like that will change. If you are in this position and are unable to pay your creditors, you might have to review the option that you have to file bankruptcy.
One of the most common things that people who are filing bankruptcy want to know is how they are going to be impacted by the filing. If your credit score is already poor, the bankruptcy filing will probably improve your score. Creditors will know you filed bankruptcy, but you won't have any debts.
Your financial status can impact every decision you make in other areas of your life. When you know that you owe creditors money, you probably want to do all that you can to pay those debts off. This could mean that you are unable to enjoy your life in the way you want, which can lead to unhappiness.