The North Carolina Bankruptcy Information Blog

There is so much we do not know about the things that put us into debt. From credit card fine print to car lease agreements and as the last few years have demonstrated, even the most basic facts about our home loans.

To anyone with the ability to fog a glass, it is more than evident that our collective ignorance on these matters is precisely what causes our country to carry so much personal debt. And despite the government’s best effort, whether in credit card reform or mortgage assistance programs, the only way to solve our financial problems is for the American consumer to educate itself as to the practices, jargon and bureaucracy that obfuscate the critical, debt-inducing rules of credit and loan products.…

On December 1, the United States Supreme Court was in session to listen to a couple of arguments about bankruptcy.

The first case concerned student loans, specifically in reference to their ability to be discharged under the confines of a Chapter 13 bankruptcy. The other case, however, had larger implications on the industry as a whole, as it challenged the bankruptcy code itself.

Bankruptcy attorneys are not allowed to encourage clients to take on more debt if they have communicated to the attorney that they are considering filing for bankruptcy. To no surprise, the provision was put in place in 2005 as part of the Bankruptcy Abuse Prevention and Consumer Protection Act.…

When Francisco Espinosa filed his Chapter 13 bankruptcy petition, he must have had no idea his case would end up before the United States Supreme Court. Espinosa’s case was just another run-of-the-mill consumer filing, except for one thing . . . the repayment plan he proposed provided that he would pay back $13,250 to United Student Aid Funds, Inc. (USA Funds), the holder of his student loan debts. But he actually owed USA Funds $17,832. The bankruptcy court confirmed the plan. The trustee then sent USA Funds a notice stating that its claim “would be paid as listed in the plan” if it did not dispute the amount within 30 days.…