Legal Question in Bankruptcy in California

Car leases & applying for student loans

If I declare Chapter 7 Bankruptcy, do I forfeit a lease agreement on a car? Also, will I be eligible to apply for and receive student loans after filing bankruptcy?


Asked on 9/03/00, 11:33 pm

2 Answers from Attorneys
Larry L. Doan Law Office of Larry L. Doan

Re: Car leases & applying for student loans

Not necessarily. The leasing company would most likely ask that you sign a reaffirmation agreement in order to continue with the lease. If you don't, usually you can continue the lease by being current on your payments, but the company can always terminate the lease and repossess the vehicle.

As for the student loans, I don't know much about how they make their credit decision but I would imagine that they would take your bankruptcy heavily into consideration.

Liem Doan, Esq.

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Answered on 10/05/00, 5:27 am
Mark Markus Law Office of Mark J. Markus

Re: Car leases & applying for student loans

No, you do not forfeit your car lease. As long as you stay current with payments, you may keep the vehicle. As for student loans, they are strictly prohibited from denying a loan based on a bankruptcy (11 USC 525(c))

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Answered on 10/05/00, 11:13 am


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