Tag Archives: ConsumerDebt

Did You Know Employers Can Become Liable for Wage Garnishments?

A recent article in CNBC issued a warning to its readers that employers can be on the hook for defaulted student loans by ignoring wage garnishments. The truth is, this also applies to other types of defaulted debts, such as medical bills or past due credit cards. Creditors will sometimes seek judgments against past due borrowers to recover losses (although the Department of Education does not need to go through the courts to issue wage garnishments for federal student loans). This allows creditors the means to garnish the wages of these borrowers. A creditor in Missouri can garnish 25 to 10 percent of wages, depending on the situation. Creditors in Kansas can seize 25 percent of wages. Once a wage garnishment is issued, employers are notified by courts or government agencies and told they need to comply. Employers only have a limited amount of time to comply with the order…
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Want to Save Your Car from Repossession? Meet the Chapter 13 Cramdown

One of the major benefits of Chapter 13 bankruptcy is that it can help you keep your most important possessions. Last week, we discussed how Chapter 13 can stop the foreclosure process and strip secondary mortgages. Did you know Chapter 13 bankruptcy can also reduce the amount of money you owe on your car? Bankruptcy attorneys call this process the ‘506 Cramdown’, or the Chapter 13 cramdown. So how does the Chapter 13 cramdown work? Here is a hypothetical example to give this concept some clarity. James is 31-year-old software engineer who has fallen on hard times. His $65,000 in student loans, $15,000 in medical bills and car payments have become too much to handle. To make matters worse, his rent continues to climb each year, making life even more unaffordable. James begins to consider the possibility of filing for bankruptcy, but he worries that if he does so, he…
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Filing for Bankruptcy Can Resolve Serious Consequences of Debt

Some people might be apprehensive about filing for bankruptcy, believing it may harm their credit scores or reflect poorly on their financial futures. However, this is very far from the truth. Filing for bankruptcy can actually stop the worst-case serious consequences of debt from occurring, such as foreclosure or losing a business. Once the bankruptcy has been completed, debtors will receive a fresh start from which they can build a solid financial future. How Does Bankruptcy Resolve Serious Consequences of Debt? Foreclosure: Foreclosure is the worst-case scenario for homeowners behind on mortgage payments. Depending on the situation, filing for Chapter 13 bankruptcy can save homes. Filing for Chapter 13 bankruptcy will put an automatic stay into motion, which will halt all collection attempts, including foreclosure. For homeowners with multiple mortgages and undervalued homes, lien stripping is also a possibility. A lien strip allows some homeowners to eventually discharge second and…
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