Why would anyone want to be in a Chapter 13 case that lasts forever?
The mere thought of being in Chapter 13 for the rest of your life sounds crazy to most people.
Who should want to be in a Chapter 13 that never ends?
The answer to this question is………a person who has student loans that don’t qualify for any government program.
It is true that there are some great government programs for people who cannot afford to pay their student loans. However, government programs cover government student loans. What does a person do who has private student loans?
What can a private student loan collector do to you?
A private student loan creditor can garnish your paycheck without any regard to how much money it takes for you to meet your basic needs. Once a private student loan collector gets a judgment against you, they can completely clean out your checking account. In addition, they can put a lien on your house. A Chapter 13 bankruptcy case can protect you from these attacks.
Chapter 13 may be the right solution for a person who is being pursued by a private student loan collector.
While it is true that it is super difficult to discharge a private student loan, it is also true that a Chapter 13 will stop a private student loan garnishment.
How much will a Chapter 13 payment be versus the amount of a private student loan garnishment?
If a private student loan collector goes through the Georgia courts, they can garnish up to 25 percent of your net wages.
In the alternative, if you choose to file Chapter 13, your payment could be a lot lower. Every case is different. To know for sure, you must meet with a local bankruptcy attorney. We offer free consultations to anyone living in the northern half of Georgia.
A Chapter 13 payment has to be a reasonable payment. In other words, there has to be enough money for you to pay your basic living expenses before the Chapter 13 payment is made.
Since you most likely cannot discharge the student loan in bankruptcy, what does a person do after the case ends? The longest period that a Chapter 13 can last is 60 months.
The answer is……….refile the Chapter 13. Will you be able to get a discharge of debts in the second case? No.
Why in the world would you want to refile the case? The answer is to get another 5 years of refuge and protection from the private student loan collector.
Conclusion.
I believe that at some point in the future, some person is going to run for Congress on the promise to make student loans dischargeable in bankruptcy just like any other debt. Once politicians finally figure out that this issue is a winner, things will change fast.
Until then, private student loan debtors can file one Chapter 13 right after another.
Call me today at 770-637-1756 for your free consultation.