Bankruptcy Indiana

Even though I’m always reading, everything from professional law journals to the daily newspaper, any material that might have to do with debt consolidation or (especially in recent days) about student loan debt help,
I was really struck by two similar stories from two very different parts of the world.

The first story happened very close to the Zuckerberg bankruptcy law offices in Anderson, Indiana.  IndyStar.com featured the tale of a young man who recently graduated from Ball State University, who is, before even beginning his career, $30,000 in debt.  I’m hardly surprised, I must say.  Student loan debt has played an increasingly large role in my conversations with clients. 

After almost 25 years as a debt consolidation lawyer offering bankruptcy services in Indiana, I’m finding an increasing number of clients who not only need student loan debt help, but are in a situation where student loan debt is the main factor driving them to consider filing personal bankruptcy in Indiana.

The second story, called to my attention by one of my Columbus bankruptcy lawyer colleagues, quite literally comes from the other end of the earth – Korea. The Korea Joongong Daily reports that 24-year old Lee Ji-ho has already filed for personal bankruptcy, “crushed by the loans he took out to pay his college tuition.”

Like many of my clients who file individual bankruptcy in Indiana (or even small business bankruptcy in Indiana), Ji-ho was negatively affected by a combination of factors, not just one.  His father passed away and Lee Ji-ho needed money for funeral expenses and for his mother’s growing medical bills.  During the period of time from when Lee was first admitted to college, he served his compulsory military services and then worked part-time to cover expenses.  Ironically, the government refused to give him a low-interest loan, saying he had “too much income.” Lee was forced to turn to high-interest lenders for help.

(All Indianapolis bankruptcy lawyers have seen similar things happen, when debtors, in desperation, turn to payday lenders.)

Can bankruptcy in Indiana provide relief from student loan debt?  Yes, but with “caveats”… Under the new (2005) Indiana bankruptcy laws, the most likely source of relief will happen when other debt is discharged through bankruptcy, freeing up money to pay on the student loan!

H.R. 2028, the Private Student Loan Bankruptcy Fairness Act of 2011, is in committee stage as I write this.  The stated purpose of the proposed bill, according to the National Consumer Law Center is this:

Restore the Bankruptcy Fresh Start for Student Loan Borrowers!

To which I, along with all the good bankruptcy attorneys in Indiana, have just one word to say”

AMEN!