• Chicago Bankruptcy Attorney Evaluates Options for Student Loan Debt

    Student loan debt was been soaring for the last decade and a half, and many economic experts believe it could hinder a recovering economy. Student loan debt has increased by almost 500 percent since 1999, and in 2010 student loan debt in the United States surpassed credit card debt for the first time. Some analysts predict the total student loan debt in America to be in excess of $1 trillion.

    Student loan debt is not dischargeable in bankruptcy unless the borrower can prove extreme hardship endured by the borrower. Exceptions are rare. Illinois Senator Dick Durbin has proposed some solutions to the possible pending crisis, including bankruptcy protection for borrowers of private student loans. U.S. Representative Hansen Clarke (D-MI) introduced the Student Loan Forgiveness Act of 2012, which would allow borrowers to receive partial loan forgiveness. Under this proposed act, debtors can pay 10 percent of their income to their loans for 10 years; after that, the rest of the debt can be forgiven. Even more forgiveness incentives are available to graduates who choose a career in public services, such as firefighters or teachers.

    These are some interesting options for the looming student loan debt crisis. This is a problem that must be addressed, but borrowers should not count on being able to discharge student loan debt in bankruptcy. If you are struggling with debt you may want to consider bankruptcy to discharge other debts so you are able to pay back your student loans. Visit our website for more bankruptcy information .

    Benjamin Brand Services- Chicago bankruptcy lawyer .

  • Chicago Bankruptcy Lawyer Reflects on Detroit Financial Crisis

    Detroit has been in a financial slump for many years now, and the effects have been felt by public officials, business owners and certainly laid off workers. Some experts predict that Detroit may become the first major American metropolis to file a Chapter 9 municipal bankruptcy.

    As Detroit has faced hundreds of millions of dollars in bills, the city has continued to cut back on public services. Detroit is battling claims and lawsuits from creditors, city worker unions and retirees. The repercussions are being felt throughout the city as there are fewer police officers and firefighters available.

    It is possible that a federal bankruptcy judge could permit Detroit to renegotiate labor contracts or even nullify them.

    “It’s a situation of ‘Be careful what you wish for,'” says John Pottow, a professor at the University of Michigan Law School. “The judges are much more involved. They’re reflecting an amenability to serious labor cuts, and I think that’s surprising to a lot of people who didn’t think they’d do much in bankruptcy. We are in a new era of Chapter 9 and using it in new ways. It’s an unknown, uncharted and unpredictable process.”

    These cuts to unions and other programs may cause Detroit citizens to struggle with their own debt as government programs they rely on dry up. Please visit our site for more bankruptcy information .

    Benjamin Brand Services- Chicago bankruptcy attorney .