Everyone knows – at least generally – what it means when a person is “bankrupt.” It means that a person no longer has the money to pay off their debts. But what, exactly, does “bankruptcy” mean, in a legal sense? This article is intended to provide an answer to that question as well as a very brief introduction to the two major forms of bankruptcy that are available to individual consumers: “Chapter 7” and “Chapter 13.”
Commercial Law
If a servicemember receives order to relocate to a new area for 90 days or more, and the service provider does not support coverage in that location, the servicemember may terminate the contract under the SCRA. A written notice to the cell phone provider of the intention to terminate the contract, along with the reason for termination, and a copy of the military orders is required. After notice is given to the cell phone company, the contract is immediately terminated.
While the servicemember is on active duty, the SCRA caps most preexisting loans or obligation to 6% a year. All excess interest is forgiven during the period of active duty and the loan is changed to reduce monthly payment fees. This cap does not apply to debts or loans obtained during active duty, and the servicemember must prove that military service affects their ability to make payments. The military member must provide a written request and a duplicate copy of their order to the lender. Requests are acceptable at any time during active duty, and up to 180 days after the individual’s military service period are over.
Auto Lease Termination
The Servicemembers Relief Act allows active duty servicemembers to terminate an automobile lease, without having to pay additional charges, if one of the following situations apply:
- The individual entered into the lease before entering into active duty, and the servicemember is called into active duty for at least 180 days,