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New law proposal could change bankruptcy options

Whenever there is proposed legislation in areas round Massachusetts that impact bankruptcy regulations, those laden with consumer debt should take heed. If someone is in a high level of debt, bankruptcy can be an option. It's important to be mindful of the applicable laws and options available, but personal bankruptcy can help those who are mired with medical expenses or other levels of consumer debt.

A new proposal by a Rhode Island lawmaker would tweak the current bankruptcy laws to help apply to students who have high levels of medical bills. The proposal, under the Medical Bankruptcy Fairness Act, would allow students to wipe out their student debt if they had paid more than $10,000 dollars in medical expenses over a three-year period. The process could potentially make things easier for those who claim bankruptcy protection after facing high interest rates and large liability balances.

Massachusetts's residents have a right to know about the applicable laws, and often things can change based on current demands and new appeals. Currently, bankruptcy does not allow those to discharge student debt, but it can help those with significant amounts of medical or credit card debt. For recent students who have high levels of debt, a new law allowing the discharge of un-payable balances could be an opportunity worth discovering.

If someone is having difficult finding a job and is struggling with financial challenges, bankruptcy is an option. Often individuals can help keep their homes and stave off predatory lenders. Personal bankruptcy can offer peace of mind for those who want to start fresh. The legal landscape for bankruptcy can change with new laws, so it's important to be up-to-date on the latest information and options that are available.

Source: Wall Street Journal, "Bill Would Let 'Medically Distressed' Cast Off Student Loans," Katy Stech, Aug. 1, 2014

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