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Bankruptcy Options

October 3, 2010 By admin Leave a Comment

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When Declaring Bankruptcy is a Good Option

Author: Jerry Work

Bankruptcy is a legal process intended to help individuals and companies who are unable to meet their debt obligations. Bankruptcy can help you get control of your financial situation and help you maintain possession of property to which creditors might have a legal claim. The process can have very negative effects on your ability to borrow money for quite a long time (up to ten years), but there are circumstances where bankruptcy might be the best option.

There are two types of bankruptcy for individuals: Chapter 7 and Chapter 13. The two types work quite differently. When filing for Chapter 7, most of your unsecured debt disappears within 90 days. However, much of your property, including your home, will be sold off, with the proceeds distributed to your creditors. Basically, anything you have that is worth much at all will be sold to pay creditors. In addition, a Chapter 7 bankruptcy stays on your credit report for ten years. So Chapter 7 bankruptcy is no laughing matter.

A Chapter 13 bankruptcy lets you keep your property. This form of bankruptcy is a debt repayment plan, rather than a debt eliminator. With Chapter 13, you generally set up a three or five year repayment plan, and the bankruptcy only stays on your credit report for seven years. If you own property that you do not wish to relinquish to creditors, Chapter 13 may be your best option. Chapter 13 is also a better option for those who are having temporary difficulties but anticipate better times ahead because it has somewhat less of a long-term impact on credit ratings.

If you do not own a lot of property or are comfortable with the idea of relinquishing your property, then Chapter 7 may be the best option. It creates the best financial circumstances, from a debt management perspective, because it erases your debt. You are no longer responsible for debt repayment. How much property you must give up depends on the laws of the state where you live. But forget about moving to a state with better consumer bankruptcy laws in order to get a better deal. If you've lived in a state for less than two years, then you must abide by the bankruptcy laws in the state where you formerly lived.

If your credit score is already ruined from multiple missed payments or from being in default with creditors, then declaring bankruptcy won't have much of a negative impact on your credit score. In fact, it might even help your credit score. This is because once your declare bankruptcy, your balances and records of unpaid debts are removed. All of those debts will be marked as being included in a bankruptcy. So even though having the bankruptcy on your credit report is very negative, it may be offset by the removal of multiple active bad debts.

Since you are basically starting from scratch, you have the opportunity to begin rebuilding your credit anew. A good way to begin that process would be by acquiring a secured credit card. After being careful to make all your payments on the secured card for a year or two, you will be in position to apply for an unsecured card and continue the process of rebuilding your credit. Eventually, after seven or ten years, the bankruptcy will slide off your credit report. If you have made timely creditor payments in the meantime, then your credit will be restored.

Article Source: http://www.articlesbase.com/credit-articles/when-declaring-bankruptcy-is-a-good-option-386936.html

About the Author

ClearOne Debt Relief is a full-service debt management company providing debt settlement services such as credit card debt relief to customers throughout the U.S.

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Filing Bankruptcy San Antonio

August 15, 2010 By admin 8 Comments
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Will Filing For Bankruptcy Haunt Me Forever

Author: Eulalia Allmand

You may have filed for bankruptcy or are thinking about filing for bankruptcy, and are worried that it will haunt you forever.

Rather than focus on the perceived negative aspects, you should concentrate on the positive ones.

Bankruptcy Will Not Stay With You Forever

While it is true that bankruptcy will stay on your credit record for a period of 10 years after you have filed, you will still be able to increase your credit rating if you manage to clear all your debts.

Do not be worried about your credit rating when you file for bankruptcy. Chances are that it is in a bad state anyway, as you would have already been late on or defaulting in your payments.

Your credit rating will have reached its lowest point by the time you file for bankruptcy. After the filing, you will be able to concentrate on raising your rating again by making prompt payments in the future.

You Can Still Get a Loan after Filing for Bankruptcy

If you have maintained your new repayment schedule after filing for bankruptcy under chapter 13, then you can probably get a loan within a period of 2 years.

You will also be eligible for a secured credit card, where you might have to put up collateral equal to the amount of credit that you will be given.

As time passes by and your credit rating improves, you will be able to get a regular, unsecured card. The interest rates that you will be eligible for will probably start coming down as well, as you will be viewed as a better credit risk.

Keep in mind that if you file for bankruptcy for a second time within a span of a couple of years, it will definitely send up a red flag to potential lenders.

Bankruptcy Can Give You another Way to Repay Your Debt

Instead of thinking that your bankruptcy will haunt you forever, look at it as another way of getting another chance to repay your old debts in a much less stressful way.

This can slowly restore your confidence and self-esteem. Your lenders will also be appreciative if you stick to your repayment schedule. So stay mentally strong and control your finances, and give top priority to clearing off your old debts first.

Try to analyze the problems that caused you to file for bankruptcy and avoid falling into the same trap again. Keep an eye on your credit rating and get updated reports from the credit bureau regularly.

Keep Your Chin Up

Don't let filing for bankruptcy get you down. Treat it as a challenge, which will enable you to emerge as a stronger person.

Bankruptcy can be very testing financially and mentally. You should be prepared for a rough ride, but only for a limited period of time. Once your finances are in better shape and you have set a new level of control, then that period will soon be just a faded memory.

Remember that a bankruptcy will stay only for 10 years against your credit record. If you stick to your financial recovery plan, then you will be back on your feet in no time!

Article Source: http://www.articlesbase.com/finance-articles/will-filing-for-bankruptcy-haunt-me-forever-465572.html

About the Author

Allmand & Lee are Bankruptcy Attorneys who specialize in consumer bankruptcy and offer dallas bankruptcy services that help good people through one of the toughest times in their life. For more information please visit us at http://www.allmandandlee.com/


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Bankruptcy Green Card Application

August 12, 2010 By admin 8 Comments
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Bankruptcy May Not Cover Christmas Credit Card Binges

Author: Tony Bertolino

Does the following scenario sound familiar to you?  The Smith family has had a difficult year financially.  John Smith lost his lucrative career as a result of cutbacks to middle management at a previously thriving construction company and has been working two jobs in retail for several months.  Jane Smith recently re-entered the workforce after twelve years of staying home to raise children in order to help make ends meet.  As the year comes to a close, Mr. and Mrs. Smith realize that bankruptcy is inevitable and decide to have one more wonderful Christmas before confronting the legal steps that will need to be taken.  The credit cards come out of the wallets to make this holiday the best one yet.  Tickets are purchased for the entire family to attend the Houston Texans’ final game of the season.  The girls get new iPods and cell phones.  The Smith’s only son, true to his Texas roots, receives new gear to help him prepare for upcoming tryouts for his high school’s football team and a used truck to drive to the games.

The Smiths have no reason to worry because all of the mounting credit card bills will just be included in the bankruptcy settlement, right?  In reality, this family may learn a hard lesson about the consequences of their spending practices.

If you are feeling overwhelmed by the debt that you are carrying and you believe that bankruptcy is your best solution, please know that some of the credit card debt you have accumulated may not be dischargeable.  Section 523(a)(2) of the federal Bankruptcy Code addresses the problem of credit card binging.  This clause exempts from discharge “debt that was obtained if an individual made material and false representations about his financial condition.” This may mean that a person submitted fraudulent information on the credit card application or knowingly made purchases for which he knew he would not be able to pay.  The latter issue is the more common situation, and the exemption that describes the scenario involving the Smith family.

A credit card company is going to use Section 523(a)(2) to challenge the discharge of your debt if one or more of the following circumstances exist:

  1. An increase in credit card usage shortly before filing for bankruptcy
  2. The use of the card for recent vacations or travel
  3. Using the card while unemployed or otherwise without reasonable ability to repay
  4. A large balance at the time of filing

One specific point in the Bankruptcy Code, Section 523(a)(2)(C), deserves special attention from all of those shoppers who are determined to find the perfect gift regardless of cost.  Consumer debts owed to a single creditor that total more than 0 for luxury goods or services within ninety days of filing for bankruptcy will be considered non-dischargeable.  And, by luxury items the law is not referring to fur coats and yachts.  Instead, luxury goods are defined as “goods or services reasonably not necessary for the support or maintenance of the debtor or a dependent of the debtor.”

What does this mean for people who overindulge with their spending during the Christmas season?  If you spend thousands of dollars in December knowing all along that you plan to file for bankruptcy once the New Year rolls around, your plans for debt relief may be delayed.  If you know that you will not be able to pay for the bills you created during Christmas, you will have to wait at least four to six months into 2010 to file for bankruptcy.  In the meantime, you will be expected to make regular payments to your creditors.  The bottom line is that you should not view an intended declaration of bankruptcy as an excuse to make everyone happy with the expensive gifts under the Christmas tree.

When it comes to issues of bankruptcy, Texans are in a better position than many others in our country.  In 2008, our state ranked forty-sixth in the country for number of bankruptcies filed. While residents of the Lone Star State are proud of being the biggest and best in so many areas, this is one ranking for which we should take pride in being nowhere near the top.  However, this relatively good standing does not mean that there are not thousands of Texans who are struggling to pay their bills every month.  With the pressure to be a good consumer from the moment that the doors open on Black Friday until the exchanges are made and the clearance items are tagged the day after Christmas, the end of the year only makes already difficult situations even worse.

If you believe that you may be a candidate to file for Chapter 7 bankruptcy, which essentially offers a fresh financial start to those who qualify, make sure that you do not at this point begin to create debt that cannot be discharged.  The time to consult with an experienced bankruptcy attorney is now.  You need to receive solid legal advice concerning your financial options and any spending pitfalls to avoid while the paperwork is being drafted.  Once you know where you stand, try to relax and enjoy the rest of the holiday season at home with family and friends and not at the local mall.  Your credit rating and your legal counsel will thank you for it.

Article Source: http://www.articlesbase.com/bankruptcy-articles/bankruptcy-may-not-cover-christmas-credit-card-binges-1641814.html

About the Author

Tony R. Bertolino is the managing partner at Bertolino LLP with law offices located in Austin, Houston and San Antonio, Texas. A member of the Trial and Appellate Litigation Team, Mr. Bertolino’s practice is devoted largely to complex transactions, commercial litigation, business law, entertainment law and family law matters. You can read more about Mr. Bertolino at www.belolaw.com


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Claiming Bankruptcy

August 11, 2010 By admin Leave a Comment

Claiming Bankruptcy after the Purchase by drquimbo

Top Reasons That Drive People into Filing Bankruptcy

Author: Eulalia Allmand

Filing for bankruptcy can be a hard decision for most people to make; however, the circumstances surrounding their situation make it impossible for them to see any other way out. There are many reasons that normal trustworthy people, much like you and me, decide that filing for bankruptcy is their only option. These reasons include:

1. Job loss/unemployment - Many people have great paying jobs and rightfully decide to buy their family a nice home, good cars, and send their children to upscale schools. And why not? They have the money to pay for it. Unfortunately, right when some people are in the prime of their financial life, they find themselves suddenly laid off with little more than a severance package if they are lucky. While they are looking for a new job, the large mortgage, large car payment, and the children's monthly tuition is due. To top it off, many of these people will jump into new jobs that pay significantly less than their old one, just to get some of their bills paid. These people have now found themselves in an unforeseen situation that was beyond their control.

2. Medical bills - Sometimes the systems that are supposed to protect us, fail us. Other times, we are victims of unfortunate accidents that require extensive hospital stays and months of physical therapy. Even if we have a medical plan that pays 80% of those bills, we still have a large deductible and the other 20% to worry about. Sometimes these medical costs mount up to more than we have the ability to pay back, while still paying housing costs and buying groceries. This is another example of someone who has found themselves in an unforeseen situation that was beyond their control.

3. Divorce/separation - Not only is divorce costly, but you could also end up owing portions of your spouse's debt even ones that you didn't know about. If your spouse files for bankruptcy or is otherwise uncollectable, their creditors will not hesitate to try and get the money from you especially if the divorce is not yet final. Unemployed spouses may also find themselves taking on debt in order to get a car and a place to live after a sudden separation.

4. Predatory lending practices - Some lenders (usually labeled "subprime") prey on those who cannot get loans from traditional lenders and offer them money that they can definitely use, but will likely have trouble paying back when coupled with the large interest rates and fees that these companies often charge.

These situations catch people off guard and throw them into a circumstance that they cannot handle. All of the sudden they are in over their heads, have creditors harassing them left and right, and need a way to get out of this mess. Bankruptcy can be a practical and respectable solution to help these people get back on their feet.

Article Source: http://www.articlesbase.com/finance-articles/top-reasons-that-drive-people-into-filing-bankruptcy-383852.html

About the Author

Fort Worth Bankruptcy Attorneys Allmand & Lee specialize in personal bankruptcy and offer bankruptcy services that help good people through one of the toughest times in their life. We have experienced bankruptcy attorneys who can help you work toward a better future. For more information please visit us at http://www.allmandandlee.com/

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Bankruptcy Texas

August 5, 2010 By admin 10 Comments
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How to Prepare Filing Bankruptcy

Author: Teeny

If you are already sure that filing for bankruptcy is the only solution to all your financial problems but are unsure of how to get started, you can quickly feel overwhelmed with the number of resources you can go through for information.  Reading up on how to get started filing for bankruptcy may not be enough if you aren't really familiar with the terms and processes.  You should know that there are also a lot of people available who have the knowledge and resources to help you file for bankruptcy and make sure you have all the necessary paperwork in order.  It may be best if you consult them for your bankruptcy issues.

Your first step would be to gain as much knowledge about bankruptcy as possible. Know exactly what bankruptcy is, what it involves, and how it will affect your life in the long run. You must understand that bankruptcy is when the court system assists you in arranging payments will all of your creditors, or when they discharge your debts. It is not the easy way out of your current financial problems.  There are many tips about financial information at http://www.fidetips.com/finance for you to read.

When you file for bankruptcy with the courts, they will appoint a person to review your case, conduct a thorough study of all your finances.  That person will decide whether or not you are qualified.  If you are, the same person will likely be in charge of deciding on which of your debts can be discharged and which will require arrangements for payment.  The person will find a way to make sure that a payment plan you can handle is developed and agreed upon. Normally, the payments will be deducted from your paychecks.  This will continue until you have paid off all your debts to your creditors.

Another thing about bankruptcy you should understand is that some debts will never be discharged.  These include tax liens and back child support.  The court system makes the decision regarding which creditors you will have to pay back and which ones you do not have to but you are likely to pay off all as long as there is a way to do so.  Any assets or property you have will likely be sold off to pay some of your creditors.

If you have a particular question about bankruptcy, you can always rely on the internet and perform an online search to get the answers that you are looking for. Also, be advised that there are bankruptcy law experts and attorneys available online to guide you through the bankruptcy process as well.  Just be sure that before you get help from anyone online, you should do research on the company and the individual to verify if they are legitimate.  You should try to find the more reputable ones to help you.

You should try to avoid becoming a victim of a scam or a fraudulent entity. For this, you can go to some online forums for references and recommendations from people that have already gone through similar situations. These people can offer you a lot of great advice and tips on how to go about your own financial situation. Of course, you can also rely on your local telephone book to seek bankruptcy help, or speak with a bankruptcy expert.

Always consider other means before you decide to file for bankruptcy. You should only consider bankruptcy when you have no other means and have tried all other financial routes available to you.

Article Source: http://www.articlesbase.com/finance-articles/how-to-prepare-filing-bankruptcy-932003.html

About the Author

Teeny is a writer for finance, computer, travel, cars, shopping and other subjects for many years, please visit http://www.fidetips.com/finance for more information.



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