Personal Bankruptcy for Military Personnel

If you are currently serving in the military and have questions about filing for personal bankruptcy, it is important to speak with an Oak Park bankruptcy lawyer about your case. While active-duty members of the military can be eligible to file for Chapter 7 bankruptcy or Chapter 13 bankruptcy as civilians, there are special issues that need to be taken into consideration. In some situations, active-duty military personnel, as well as disabled veterans, may be eligible for benefits associated with consumer protection. At the same time, filing for bankruptcy can impact a security clearance in some situations.
If you have questions, you should discuss them with a consumer bankruptcy attorney as soon as possible.
How Chapter 7 May be Different for Disabled Veterans
How do bankruptcy protections change for disabled veterans? Under the Bankruptcy Code, disabled veterans can be eligible for Chapter 7 bankruptcy in certain situations without passing the means test. In order to avoid the means test, a disabled veteran must be able to show that his or her debts were accrued primarily while on active duty or engaged in other military duties. This is significant given that the means test often makes it impossible for individuals who have a steady income to file for Chapter 7 bankruptcy protection (those debtors often must file under Chapter 13 instead).
In order to qualify, a disabled veteran needs to provide proof of a 30% or more disability, or proof that he or she was discharged from the military due to a disability suffered during active duty or that was aggravated during active duty.
How the Servicemembers Civil Relief Act can Help Members of the Military with Debt
What are some of the benefits for which active-duty servicemembers may be eligible? The Servicemembers Civil Relief Act (SCRA) is among the most significant federal protections for military members. What types of benefits does the SCRA provide? When an individual enters active duty, he or she can be eligible for protections surrounding “rental agreements, security deposits, prepaid rent, evictions, installment contracts, credit card interest rates, mortgage interest rates, mortgage foreclosures, civil judicial proceedings, automobile leases, life insurance, health insurance, and income tax payments.”
As such, under the SCRA, if an active-duty servicemember is considering bankruptcy because he or she is facing foreclosure or has unmanageable interest rates on credit cards, the SCRA may be able to provide protection. At the same time, the SCRA also can result in a stay of a judicial proceeding against an active-duty servicemember who is seeking to collect unpaid debt. Given these protections, an active-duty servicemember may not need to file for bankruptcy protection—at least not immediately. A consumer protection lawyer can help you to understand what your options might be.
Bankruptcy and Security Clearances
What is one of the major reasons that an active-duty servicemember or veteran should reconsider bankruptcy? In some cases, as an article in debt.org explains, military security clearances can be impacted when an individual files for bankruptcy. However, this is not always the case, and you should speak with a lawyer about your specific situation.
Contact an Oak Park Consumer Bankruptcy Attorney
If you have questions about filing for bankruptcy while in the military, an Oak Park consumer bankruptcy lawyer can help. Contact the Emerson Law Firm to learn more about our services.
See Related Blog Posts:

Comments

Post a Comment

Popular posts from this blog

New Information on Debts That Bankruptcy Cannot Discharge

If you are thinking about filing for bankruptcy in the Oak Park area, it is important to know that certain kinds of debts cannot be discharged in a bankruptcy case. Under U.S. bankruptcy law, these are known as non-dischargeable debts, or exceptions to discharge. There are certain types of debts that have long been identified clearly as non-dischargeable debts, while there are misconceptions about other types of debts that may or may not be dischargeable. As an article in CNBC discusses, the U.S. Supreme Court recently issued a ruling in the case of Bartenwerfer v. Buckley , which clarifies that debts incurred due to another party’s fraud cannot be discharged in an individual’s bankruptcy case. Our Oak Park bankruptcy attorneys can explain the Court’s recent ruling and provide you with additional information on dischargeable and non-dischargeable debts. Supreme Court Says Debt Incurred Due to Another’s Fraud is Non-Dischargeable The recent Bartenwerfer case involved a debtor attempti
Read more

Learning About Different Types of Wills

Whether you are young or old, single or married, wealthy or with limited financial means, healthy or dealing with a medical condition, it is important to make a will. Many people have incorrectly heard that wills are only necessary for particular people, such as those with a substantial amount of assets or for older adults in poor health. Yet wills are critical for adults of all ages, and an experienced Oak Park estate planning lawyer can help you to make one. Before you begin working with a lawyer on a will, you might start conducting your own research into wills in Illinois and the requirements for a valid will. In so doing, you are likely to come across information about many different types of wills, and you are probably going to wonder whether you will need more than one kind of will. In short, there are different terms that can be used to describe the form or function of a will, as well as some distinct types of wills. Our Oak Park estate planning attorneys can explain in more
Read more

Younger Parents Need an Estate Plan

It is critical for younger parents to have an estate plan, even if they know they are healthy and do not anticipate that anything will happen in the near future. Much too often, younger parents assume that they can wait until they are older to consider estate planning or until there is a health-related reason to begin the estate planning process. Yet estate planning is critically important for parents who have minor children. While estate planning is important for adults of all ages, it can allow parents to make important decisions about who will care for their children in the event that they become unable to do so themselves. Our Oak Park estate planning lawyers can explain in more detail. Naming a Guardian for Your Minor Children in Your Will Most importantly for younger parents, making a will allows you to name a guardian who can care for your child in the event of your unexpected death. Nobody anticipates a deadly accident or a sudden situation in which there is a need for another
Read more