Is it right for me?
Some people are opposed to Bankruptcy on moral grounds but it is an option you should consider if your situation leaves you no other choice. If you want to pursue Bankruptcy, we can help!
Since the passage of the 2005 Bankruptcy laws, filing Bankruptcy is not as easy as it once was. Bankruptcy is highly regulated. Furthermore, the Bankruptcy laws were also created by Congress to provide relief to those who have been victimized by job loss, overwhelming medical bills, disability, or divorce. If you are looking to eliminate debt and seem to have no other options, bankruptcy may be the fresh start you need. Filing Bankruptcy is not as uncommon as you may think.
There are two kinds of Bankruptcy, Chapter 7 and Chapter 13
Chapter 7 is called straight or liquidation Bankruptcy. The court appoints a Trustee who may ‘liquidate’ or sell some things that you own to pay your creditors. Most of your debt will be canceled, but you may choose to pay some creditors, usually to keep a car or home on which the creditor has a lien. If you have any assets that you want to keep, Chapter 7 can have complications.
Chapter 13 works much like credit counseling and debt management plans. In Chapter 13, most of your debts are reorganized into a single monthly payment. The payment will continue for 36 to 60 months. You may not have to repay all of your debt. The minimum payment may be affected by property you want to keep. When you complete the payments, remaining unpaid debt in the Bankruptcy program is discharged.
What happens after Bankruptcy?
When you think Bankruptcy it usually goes hand in hand with, how will that affect my credit score?
Although the Federal Fair Credit Reporting Act provides that Bankruptcy notations can remain on your credit report for 10 years, in essence you could also be debt free, depending on what type of Bankruptcy you filed. One thing lenders have to consider is whether a consumer is a far better credit risk after Bankruptcy or before with a poor debt to income ratio. Studies show that 2-3 years after a Bankruptcy discharge, Bankruptcy consumers can still qualify for a home loan or credit card on the same terms or slightly higher depending on what chapter you filed.
If your credit isn’t that great to begin with and you have exhausted all other avenues of getting out of debt, we may be able to help.
Let us help you connect with an attorney in your state through our affiliated nationwide attorney network.
