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About Oregon daily emerald. (Eugene, Or.) 1920-2012 | View Entire Issue (Oct. 21, 2002)
Bankruptcy can help or harm debtors Filing for bankruptcy is one option forthose in debt, but debt reduction services are also available for consumers Jody Burruss Environment/Science/Technology Reporter Faced with student loans, living expenses and credit cards, students often feel their debt is too over whelming to handle. Bankruptcy may seem like a way out of this mess, but is not always the right choice for everyone. “I’m hesitant to recommend (bankruptcy) to a student, because until they get out into the work force, we can’t tell if they’re going to make it,” attorney Edward Hill said. Hill, a University School of Law graduate, said when students are considering bankruptcy, it is im portant to look at a credit report to determine if the student’s credit is already ruined or if there is just too much debt. This helps deter mine if bankruptcy should be re garded as an alternative. But attorney John Henderson says bankruptcy can help students get a fresh start. <33^ How would you score? Take the Kaplan 10 Question Challenge! Wednesday, October 23 Thursday, October 24 GMAT 6pm GRE 6pm LSAT 7pm MCAT 7pm Eugene Kaplan Center 720 East 13th Ave., Suite 204 Try 10 Tough Questions and learn 10 Winning Strategies from a Kaplan test expert to help you succeed on test day. Reserve your seat! Take the Kaplan Challenge and find out If you’re ready for the real thing. 1-IIO-KAP-TEST kaptest.com www.sdadravei.com STA TRAVEL online »> on thc PHone >> on cnmpu/ >» on the /meer If a student goes bankrupt, this will show on their credit. But, Hen derson said, this can actually be better than doing nothing. “It’s the first step in resurrecting their credit,” he said. “Bankruptcy is there to offer a fresh start.” Paying bills late — not going bankrupt — is what gives destroys people’s credit, he added. Henderson said that a different option to bankruptcy is consumer credit counseling. This involves bar gaining with creditors to attempt to reduce debts owed. Debt Reduction Services branch manager Timothy Carson said debt reduction is a great alterna tive to bankruptcy because once the debtor has paid on all out standing accounts, his or her cred it rating will be restored. With bankruptcy, it can take seven to 10 years to restore one’s rating. Carson said DRS doesn’t barter "I'm hesitant to recommend (bankruptcy) to a student, because until they get out into the work force, we can't tell if they're going to make it" Edward Hill attorney with creditors for the amount owed; it works with those companies to reduce interest rates and stop over limit and late fees. Bankruptcies in Oregon Number of bankruptcies 23,071 18,210 18,205 J_ 1997 1998 1999 2000 2001 24.000 18.000 12,000 6,000 0 “We start with (the debtors’) budg et and go from there,” Carson said. Many clients come in with tunnel vision, thinking it’s the end of the world because they are so far in debt, Carson said. But often some one else can look at their budget and find a way to better manage their money, and the client leaves happy, Carson said. As long as the debtor has the abil ity to make payments, debt reduc tion will likely work as an alterna tive to bankruptcy, Carson added. If a student does go bankrupt, it does not mean that student loans will be forgiven. There are three types of debt — priority, unsecured and secured. Student loans are pri ority debt; secured is debt that is connected to property. The only kind of liability that is discharged in a bankruptcy is unsecured. Hill said it is just as common to see parents who have co-signed stu dent loans for their children to have financial trouble because their chil dren are in default. He said credi tors will usually look to the student first, but in the end they don’t care who repays the loan. Hill added that many creditors practice illegal debt collection by threatening debtors with jail. ASUO Legal Services Attorney Ilona Koleszar said they do not offer bankruptcy services for students because it is very labor-intensive and time-consuming. They do, how ever, have a book of local contacts available for more information on bankruptcy, she said. For more on debt reduction, visit www. debtreductionservices .com. Contact the reporter at jodyburruss@dailyemerald.com. utMtiM Cox continued from page 1 aren’t being filled. As one example of a way to cut spending, Cox-said he’d stop the OLGG from running liquor warehouses. “Seagrams is more than happy to deliver a case of liquor directly to a bar instead of an Oregon City ware house,” he said. “You can’t tell me we need a tax increase if there’s that much waste that even I, a third-party candidate without a huge staff, with out millions of dollars, without full time accountants and lawyers on staff to pour over these issues, I can still find these things.” As a Libertarian, Gox said as Governor he’d stimulate Oregon’s economy by issuing tax cuts, mon ey that would be free to use once the budget had been trimmed under his plan. Cox slammed his opponents in the gubernatorial race, chastising Republican Kevin Mannix for his so cial intolerance and Democrat Ted Kulongoski for being tax-happy. “I’m the only fiscal conservative in this race, and I’m socially toler ant,” he said. “We don’t want some body who’s going to tax and spend or borrow and spend, and we also don’t want somebody who’s going to try and use the power of state government to tell us how to live our lives or what values to have.” The Liber tarian, who mentions Thomas Jeffer son, John Adams and George Wash- COX ington as his role models, said by fixing the state’s budget and instigating reforms, he can conquer issues problems with higher education spending. “We absolutely have to get state spending under control,” he said. “I am the right guy with the right plan at the right time.” Contact the news editor atbrookreinhard@dailyemerald.com. High quality and low prices & FREE DELIVERY ON ORDERS OVER $25 ODE Classifieds... Worth Looking Into! Oregon Daily Emerald P.O. Box 3159, Eugene OR 97403 The Oregon Daily Emerald is pub lished daily Monday through Friday dur ing the school year by the Oregon Daily Emerald Publishing Co. Inc., at the Uni versity of Oregon, Eugene, Oregon.The Emerald operates independently of the University with offices in Suite 300 of the Erb Memorial Union. The Emerald is pri vate property. The unlawful removal or use of papers is prosecutable by law. NEWSROOM — (541)346-5511 Editor in chief: Michael J. Kleckner Managing editor: Jessica Richelderfer Freelance: Ayisha Yahya, editor News desks: Brook Reinhard, Jenni Schultz, news editors. Jan Montry, senior reporter—campus/federal politics, Brad Schmidt, senior reporter—city/state politics, Jennifer Bear, campus/city culture .Jody Burruss, environment/science/tech nology, Jillian Daley, family/health/education, Danielle Gillespie, safe ty/crimeAransportation Pulse: Jacquelyn Lewis, editor. Ryan Bornheimer, senior reporter. 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