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New Debt Relief Legislation Passed In Iowa To Help Drivers Keep Their Licenses

In Iowa, the Department of Transportation (DOT) has the power to suspend your driver’s license if you have overdue fines or have failed to pay outstanding court debts. According to the Des Moines Register, the Iowa DOT revokes or suspends somewhere between 140,000 and 160,000 driver’s licenses every year, and roughly half are suspensions due to outstanding court debts. This means that thousands of Iowan motorists lose their licenses every year for financial reasons, not because having them on the road poses a danger to the public. In order to address this issue and to provide a measure of debt relief, Iowa has passed a new law that is aimed at helping motorists who are having financial troubles stay on the road. The governor has already signed the new legislation, and the law will take effect July 1st, 2016.

Changes Implemented Under The New Legislation

The Des Moines Register notes that Iowa’s new legislation has three key provisions. These changes to the current law revolve around payment plans and are briefly outlined below:

  • Payment Plans: Under Iowa’s current law, drivers can only enter into a payment plan if their license has already been suspended. However, the new legislation allows a driver who has delinquent court debt to enter into a repayment plan before their driver’s license is suspended.
  • Second Chance Payment Plans: Currently, if a driver is on a payment plan and begins missing payments, they can only get their driver’s license back after paying their debt in full. The new law allows these delinquent drivers the opportunity to enter into a new payment plan even though they missed payments under their original plan.
  • Decreased Installments: Additionally, the new legislation allows drivers who are on a payment plan to pay lower installments if needed. Drivers will need to submit a new statement of their finances demonstrating that they need to lower their monthly payments.

In Iowa You Can Lose Your Driver’s License Due to Unpaid Debt

While the DOT is able to suspend your driver’s license for a number of different reasons, non-driving related reasons commonly include overdue traffic fines and failing to pay court ordered child support. While having your driver’s license suspended is a serious matter, it is important to understand the difference between having your license suspended vs. revoked. If your driver’s license is suspended then you are prohibited from driving for a certain period of time. On the other hand, if your license is revoked you can not legally drive until you are granted a new license, and there is no guarantee that the DOT will permit you to have a new one. If the DOT takes your driver’s license for financial reasons they likely suspended it until you are able to repay your debts.

How Can We Help?

If you live in Southeast Iowa and are in need of debt relief, contact the Noyes Law Office, P.C. today for a free consultation. Our experienced bankruptcy and debt relief lawyers are happy to assist you and can be reached toll free at (800) 875-7148.

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