(Case Analysis) Soon after the birth of their second child, misfortune fell on t
ID: 2455163 • Letter: #
Question
(Case Analysis) Soon after the birth of their second child, misfortune fell on the lives of Kurt and Leah Lyons. Kurt got laid off, the landlord raised their rent, they received notice that their car was about to be repossessed, and dunning letters arrived daily from credit card companies. Reluctantly, the couple filed for personal bankruptcy. Their disappointed parents told them that the bankruptcy would remain on their credit rating for the rest of their lives and that they would never again be able to establish a line of credit or obtain a mortgage to buy a house. Were Kurt and Leah’s parents correct? Explain.
Explanation / Answer
Bankruptcy may be an easy way out but it makes it difficult to obtain new credit . If bankruptcy is under cahater 7 it will remain on your credit card for 10 years while if it is under chapter 13 it will remain for 7 years.Under chapter 13 it is removed early since in it a portion of debt is paid
Hence Kurt and Leah's parents are not correct.
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