A Chapter 7 Filing Can Give You The Fresh Start You Need Far More Quickly Than A Debt Consolidation Program
When considering bankruptcy or chapter 13 as an option, many people are concerned about whether or not they might lose valuable property including their houses, cars, boats, bank accounts, cabins, retirement accounts and other possessions. Before you jeopardize your future by cashing out your retirement accounts or 401k plans or otherwise borrowing against them to pay your debts, you must consider your options and consult with a bankruptcy attorney. A knowledgeable attorney who concentrates his or her practice in the area of debtor creditor law is a valuable source of information on how to protect your assets through the bankruptcy process. Before making any final decisions regarding debt payment plans, cashing out retirement plans or bankruptcy options you should contact attorneys at Law Offices of Lee Kravitz to discuss how to protect your assets when your financial well being is at stake.
HOW MUCH MUST I OWE TO FILE BANKRUPTCY?
There is no minimum or maximum amount of debt necessary , Filing of the case depends on your personal situation and your ability to repay your creditors. We will review your budget, assets and your debts in order to determine the best option for your situation.
CAN I SAVE MY VEHICLE
Cars and other vehicles that are financed are subject to repossession if you fall behind on your payments. If you are current with your payments and you do file a chapter 7 petition, you should be able to retain your vehicle while continuing to make the regular payments. If you have fallen behind and your vehicle is repossessed, chapter 13 will force the creditor to return the vehicle to you. Chapter 13 can also reduce the balance, interest rate and monthly payment on your vehicle.
CAN I SAVE MY HOME?
If your home is in foreclosure and going to be sold at a sheriff’s sale, both chapter 7 and chapter 13 will stop the sale. If you want to keep your home and you are not current with your payments, chapter 13 will allow you to set up a repayment plan over time to catch up the delinquent mortgage payments. If you are current with your mortgage payments and you file Chapter 7 or Chapter 13, you can keep your home.
HOW CAN I STOP GARNISHMENTS?
Both wage garnishments and bank attachments will be stopped immediately upon the filing of a Chapter 7 or Chapter 13 bankruptcies. The automatic stay forces creditors to immediately stop collection activity once your bankruptcy case number is issued by the court.
CAN I SAVE MY RETIREMENT ACCOUNT?
Retirement accounts such as IRA's, 401k, pensions, and most profit sharing associated with retirement plans are protected assets that cannot be taken by the bankruptcy court to pay your creditors. Therefore if you file bankruptcy in most circumstances you will be able to keep your retirement plan.
If you file Chapter 7 or Chapter 13 you can put delinquent utility bills in your case and prevent shutoffs. If your utilities are shut off, the utility companies must restore service when you file. They usually require a security deposit. Your utility balance will be reduced to $0 upon the filing of your case
WHAT ABOUT MY CREDIT RATING?
The filing of bankruptcy does have in a negative impact on your credit rating. However most people that file bankruptcy already have poor credit ratings. Therefore the bankruptcy will discharge all of your debts and give you the opportunity to have a fresh start and rebuild your credit over time. In many instances, creditors are now offering credit to people that file bankruptcy. For example, you may be offered a small balance credit card account or a car loan after bankruptcy. Although bankruptcy stays on your credit for 10 years there is life after bankruptcy. Credit scores can climb from 650 to 700 within 2 years of filing, if you utilize new credit offers and make timely payments
If the IRS has attached your wages, bankruptcy can provide relief to you. Some taxes can be discharged in bankruptcy. Others can be paid back through chapter 13.
IS THERE A COURT APPEARANCE ASSOCIATED WITH BANKRUPTCY FILING?
There is generally one appearance required at the bankruptcy court. However, you do not see a judge but meet with a chapter 7 or chapter 13 trustee. This person is appointed to review your case to make sure that the information in your bankruptcy petition/paperwork is accurate. It is also the job of the bankruptcy trustee to recover assets for creditors. However most cases are no assets cases as most property is exempt which means that the court cannot take the property from you when you file bankruptcy.
WILL BANKRUPTCY STOP CREDITOR HARASSMENT?
The filing of the bankruptcy or chapter 13 petition immediately puts a halt to creditors contacting you from 8 a.m. to 10 p.m. at night, suing you, garnishing your wages, attaching bank accounts, putting a lien on your property, foreclosing, and repossessing your vehicle. It is important to meet with the attorneys at the Lee Kravitz Law Offices who are knowledgeable, compassionate and willing to give you advice regarding your options.
SHOULD I TRY TO PAY MY DEBTS THROUGH DEBT CONSOLIDATION?
Many clients, when considering bankruptcy, instead choose to enter into debt repayment plans. Although some plans are legitimate, many will charge you exorbitant fees up front and not begin negotiating with your creditors until they have accumulated thousands of dollars. In the meantime you can be sued by creditors who can then obtain a judgment and garnish your wages while you are paying the debt consolidation agency. You need to be very careful about working with out-of-state agencies over which you have no control. If your finances have reached the point where you are already behind with your payments to creditors, paying debts to a debt consolidation agency, who in turn may not send money to your creditors for months, will serve only to worsen your credit score. Therefore it is imperative that you consider all of your options first before getting into a Telemarketing or a Online Debt Repayment Program that does not have your best interest in mind.