Should I File Bankruptcy for Protection?
Whether to File Bankruptcy – Do Not Feel Guilty
Bankruptcy is about starting over and getting a fresh start. If you file bankruptcy, will get back in control of your financial future. Do not feel any shame for considering bankruptcy. In today’s economy, many people, from all walks of life, are in your situation. We have clients who were making over $100,000 last year and live in homes worth over half-million dollars. Then again, we have an 18 year old who started out in life with $35,000.00 in debt (thanks a lot, Master Card, Visa and Amex) due to “free” credit cards. Who gives an 18 year old a $5,000.00 credit line? The irresponsible credit card companies.
Bankruptcy Is Not Your Fault
Take control, and feel no shame. It’s not your fault. Things are going on all around us.
- The housing bubble has burst, and inflated again.
- Gas prices are higher.
- The credit crunch is in full swing.
- In 2018, some houses still have underwater mortgages.
- Stockholders and 401k owners hurt by recent stock market “corrections.”
All of this is not your fault.
You cannot control the economy, you cannot control pie in the sky investors, and you cannot control voodoo accountants at multinational corporations (Enron), but you can take control of your own financial situation back by contacting a bankruptcy lawyer. Since you were a tiny tike, the marketing companies have been trying to get you to buy into neighbor Jones’ dream. Be like Barbie. Get whatever you wanted. Go for it. If you didn’t have the cash, “charge it.”
The Credit Card / Debt Trap
Credit card companies have been enticing — pleading — for you to charge up at 23% (some 28.99%) for years. How many “account balance” transfer offers have your received? How many new extensions of credit card debt have you gotten? Here’s the trap: after you have established a decent payment history with a credit card company, they increase your credit limit. “Congratulations,” they say. Now that you have more credit, go out and spend it. Here are some additional checks that are as good as money. Spend away. They will keep upping that credit limit until you can barely make the minimum payment. When this happens (and it happens to a lot more people than you think), they own you.
If you pay only the minimum payment on your Mastercard or Visa, you’ll be paying the minimum payments on that debt for 35 years or more. Is it any wonder people are stuck in this minimum payment trap? Don’t feel any shame about taking back control.
The Thing Credit Card Companies Fear
The only thing the credit card companies fear is the United States Bankruptcy Code and a bankruptcy attorney. That is why, in 2005, credit cards lobbied Congress to the tune of over $100,000,000 in so-called bankruptcy reform to get the bankruptcy laws changed to protect them from you. They made it harder to file bankruptcy under Chapter 7, forcing more people to repay debt. If you are considering bankruptcy, the bankruptcy lawyers at Los Angeles Bankruptcy offer a helpful consultation to help you come to terms with your financial future. We understand.
Chapter 7 Bankruptcy
Chapter 7 Bankruptcy is where you liquidate all non-secured debts. Consumer Liquidation Bankruptcy applies when the monthly payment on all personal overhead (rent/car payment/utilities/groceries) exceeds your take home income. File bankruptcy, and you will likely keep your home and your car (if current) under the current state of the law (these are called California bankruptcy exemptions). But you’ll want to have a skilled bankruptcy attorney to help so you don’t lose anything. Read more about Chapter Seven Bankruptcy, with regard to liquidation.
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is all about forcing creditors to negotiate with you subject to a bankruptcy trustee’s approval. Filing bankruptcy under Chapter 13 forces creditors to settle up for dimes on the dollar. Once again, you take control and you set forth a Chapter 13 Bankruptcy plan that you can work with. Chapter 13 Consumer Bankruptcy applies when your income exceeds your monthly personal overhead to some extent such that you are able repay some portion of the debt back. Once again, however, recognize a Chapter 13 Consumer Bankrupcy puts you back in control. Learn and read more about Chapter 13 Wage Earner Bankruptcy.
To learn more above the differences between Chapter 7 Liquidation Bankruptcy and Chapter 13 Wage Earner Bankruptcy, click here [under construction].
Do I need a Bankruptcy Lawyer to File Bankruptcy?
Of course, you are free to file bankruptcy on your own. That is your right. Beware the lure of thinking that because you can do your own taxes, you can do your own bankruptcy forms. There are many legal decisions to make just in the listing of your assets. Which value do I list? (The amount paid? Current value? Garage sale?) Do I need to list every CD and DVD I own? And this doesn’t even get into the topic of bankruptcy exemptions and protecting your assets. Let alone the complicated Means Test for Chapter 7! Making a wrong move could cost you possession of your goods and property. It really does pay to hire a bankruptcy lawyer.
Credit Card Debt Management and Consolidation Services
With Debt Consolidation Companies You Lose Control
Credit card counseling and debt management services – it doesn’t work, in our experience. Numerous clients have come to us after using a debt management company like CCC and their ilk. Recognize “nonprofit” organizations like CCCS are funded by the credit card companies – are they on your side? No. Further, some counseling services require you to give them your paycheck. They take their fee, pay the credit card companies a payment, and then give you a monthly stipend. Don’t do this. Take control. Learn more of the frustrating side about consumer credit counseling services.
Take Control of your Financial Future
Don’t lose control of your financial future. Did you know this? If you breach your contract with a debt management or consolidation company (aka credit counselling), you lose all the benefits you have gained – penalties and interest all gets put back. Debt management does not stop credit card lawsuits. Did you contract with CCCS to protect your credit. They are right there on your credit report as Debt Consolidation Service or Credit Management… a negative entry that tells creditors that you are a bad credit risk. Consumer bankruptcy and consumer bankruptcy attorneys and lawyers are about empowering you. Don’t let someone else control you.
Learn more about consumer bankruptcy.
Getting Credit After Bankruptcy
Will I get credit offers after my BK ? You will get credit after bankruptcy. This is a new beginning, and a fresh start. Some clients have been very concerned about the state of their credit after filing bankruptcy. It is a fact: a bankruptcy entry will appear on your credit report for 10 years following the discharge. This does not mean that you will not get a credit card, buy a home, or car for 10 years.
Far from it; remember: creditors want you to borrow. Shortly after your bankruptcy discharge, we can almost promise that you will receive a credit card offer to help you get back on your feet (possibly from Providian). The fact is, you no longer have the majority of your debt; you have an ability to repay (income is freed up), and you can’t declare bankruptcy (Chapter 7) again for eight years. Further, the probability of a consumer declaring bankruptcy a second time in their lifetime is low (it does happen, but after most people do it once, they change their habits).
Mortgage After Bankruptcy
Can I Buy A House or Car After I File Bankruptcy ? Yes! You can buy a house after bankruptcy. A home loan is up to the discretion of the lender, obviously. However, many of them want your business. They may charge you a higher interest rate or points on your loan, but it certainly is possible to get a loan for a house after bankruptcy. How long? Figure on waiting two years: the bankruptcy will still be there on your record, but it will be a diminished factor which they consider. We work with mortgage lenders we can direct you to which will help you into your next home. So yes, you can and will get a mortgage after you file bankruptcy. You will get a fresh start.
The Caring Bankruptcy Attorneys Here Understand
Los Angeles Bankruptcy offers a helpful bankruptcy consultation. We are here to help you take back control of your financial future.