Scenario 1: Bankruptcy
There are some advantages and disadvantages to filing for bankruptcy chapter 7. According to chapter 7 debt liquidation bankruptcy is good option for many people who are dire financial straits. When the debtor files for Bankruptcy there is an automatic stay and most creditors must have stop their collection efforts. Thus, the debtor can begin to rebuild his or her credit. Financially speaking the debtor will start over. It’s true that filing Bankruptcy running your credit from certain amount of years and may cause embarrassment for many people. Also there is 90 day presumptive period. Any debt incurred in that 90 days prior to filing Bankruptcy is presumptively fraudulent, any debt incurred with intention of filing Bankruptcy or without intention of repayment is presumed fraudulent.
Celia can file a voluntary bankruptcy is began when that debtor files petition with bankruptcy court. There will be a joint may be file if you are married and both are calming bankruptcy. When a voluntary case is done, the debtor must file a schedule of current income and current expenditures unless the court says not too file this. In 2005 reforms, the court can dismiss individual debtor’s petition for abuse if the debtor does not satisfy the mean test, the mean test measures the debtor’s ability to pay by computing the debtor’s disposable income. Only the debtor who fall below their state’s median disposable income will be able to continue in chapter seven proceeding. The individual’s debtors who meet the mean test are required to go into chapter 13 bankruptcy because they have not qualified in chapter seven bankruptcy. The formula for applying the test is under the standard the Reform Act that requires the court to find the debtor does not have the mean repay the creditors and its goes beyond the past requirement of that petition being granted in the simple assertion of the debtor stating “I have debt” Twomey, D. (2013).Based with everything stated above Celia can file voluntary bankruptcy.
Will Celia Student loans clear after she files bankruptcy to answer this question to the best of my ability the answer I have come up with is it will remain some cases and most cases it won’t remain after filing bankruptcy. The only way I can for see that Celia getting them student loans dismissed is she having specific hardship problems, where a filer is disable or extremely unlikely to ever be able to pay that debt back to lender. Even though you can’t discharge the debt you place student loans in chapter 13 repayment plan, which means making payments more manageable or stopping any collection action while you are repaying that debt under a court order plan. (Woodman, C. (2011)
If you file for Chapter 7 or Chapter 13 bankruptcy and have delinquent student loan debt, your student loan servicer or any debt collection agency trying to collect your loans is barred from engaging in collection efforts during your bankruptcy case. However, if you...