In case a debtor’s liabilities are predominantly (i.e., a lot more than 50%) non-consumer financial obligation, they’re not at the mercy of the means make sure the U.S. Trustee’s Office cannot object to release under Section 707(b). Which means that greater earnings earners with disposable earnings can apply for Chapter 7 with no constraints associated with the means ensure that you can avoid a Chapter 13 payment plan. It isn’t unusual for debtors to possess significant education loan debts. Category among these education loan debts as non-consumer financial obligation may help a debtor be eligible for Chapter 7 bankruptcy. But courts have actually struggled with whether figuratively speaking is highly recommended customer or non-consumer debts.
A bankruptcy court in Texas found that student loan proceeds used for direct educational expenses for dental school with the intent that the education received would enhance the borrower’s ability to earn a future living are not consumer debts to outline the inconsistent results in determining whether student loans are consumer debts for purposes of the means test. Continue reading “Exactly about Steering Clear Of The Means Test: Education Loan Debt”