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One of the topics we often discuss here on this blog is the nearly impossible task of discharging student loan debt. Many students leave college with a degree that is supposed to help them land a career-launching job; but with the job market still relatively unstable, this degree saddles post-graduates with immense debt and only a slightly improved chance of obtaining work.

There seems to be a growing movement, both at the local and federal levels, to try to make this sort of debt discharge possible. Chapter 7 bankruptcy allows the filer to clear out much of the debt they have. Sometimes this can be all of it; but in many cases, there is still a little bit of debt left over because it is protected (like with student debt).

In this still shaky economy, millions of Californians have found themselves struggling to keep up with their monthly expenses. Some have turned to credit cards to make up this spending gap while they look for ways to bring in more income.

Relying on credit cards, though, can be a very dangerous proposition. It doesn’t take long for the balance to grow so large that even the minimum payments become unmanageable. Add in late payment fees and escalating interest rates, and it is not too hard to see how this situation leads so many Californians into bankruptcy.

When it comes to filing for bankruptcy, some Los Angeles residents may think it is a very easy process — as if someone can just up and file without much hassle. Other residents may think it is more complicated than it actually is, and thus incorrectly decide that bankruptcy is not the route for them. […]

In the past, we have talked about the extreme (and illegal) measures that debt collectors will employ to try and extract money from people. The supposedly in-debt party may not even owe money; or the debt collectors may not even have the legal grounds to even make such a request; and yet, there they are, […]

In 2005, when the Bankruptcy Code of the United States was altered to grant more oversight of consumer bankruptcy filings, Congress charged the U.S. Trustee Program with undertaking the vast challenge of reviewing potentially fraudulent filings. If an in-debt individual claimed incomes or expenditures that were out of the ordinary, the organization of trustees would pinpoint the case and bring in an outside accountant to perform the audit.

Is filing a Chapter 7 or Chapter 13 filing ideal? Of course not. It has its consequences, and the filer will have to deal with them for many years to come. For example, since a bankruptcy filing will immediately impact your credit score, it can be difficult to secure a loan in the aftermath of bankruptcy.

However, the alternative is even worse. An individual could fall so deep into debt that they face criminal charges for, say, evasion. Or the debt can become so overwhelming that an individual is basically forced to file for bankruptcy — and at that point, it can be “too late,” so to speak. What we mean by that is, you may lose more if you file a “late” bankruptcy filing as opposed to being proactive, accepting the negative side-effects of a bankruptcy and just going through with the filing at an early stage to get your financial situation under control.

Los Angeles residents are well aware that the economy is still in an uncertain period, despite recent signs that things may be turning around. For every bit of good news regarding increased job creation and decreasing unemployment rates, there is a fiscal cliff or debt ceiling debate that sends the stock markets tumbling, placing financial strain on hard-working people all across the country.

As we have outlined before — and as many media outlets have noted — college students are struggling to handle their debt. It’s not entirely their fault, mind you. Rising tuition rates and a tough job market make it very difficult for a graduating student to pay off their loan debt. Declaring for bankruptcy can help these graduates, allowing them to clear other debts to give them some financial breathing room, which can be used to focus on paying off their student loan debt.

It is a moment that every in-debt person fears: your cellphone rings and the number is unrecognizable. What’s the most likely reason for the call? Sure, it could be a distant family member — or maybe the job offer you have always wanted is just on the other end of the line. But the reason you are receiving this call is almost certainly because a debt collector is trying to garner the funds you owe.

The issue of student loans and the debt college graduates carry after they graduate has been a hot topic ever since the worldwide financial crisis of 2008. While steps are being taken to recover from that meltdown and though things seem to be getting better, it is still an uneasy economic time in Los Angeles and, indeed, all across the country.


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