The property is sold by the bankruptcy trustee and the money received is used to pay off the creditors. Unlike child support and taxes, which are priority debts, most credit card debts are regarded as non-priority and unsecured debts. Unlike priority debts which cannot be discharged, credit card debts are discharged with chapter 7. It is possible for an individual to file for bankruptcy under chapter 7 and endorse all debts except credit card debt. In this case, the bankruptcy filer is liable for the endorsed debts after the bankruptcy is finished. Chapter 13 Bankruptcy If your situation permits, bankruptcy under chapter 13 might suit you well. During this type of bankruptcy, you are required to make partial or full payments to some creditors. A specialized repayment plan is drafted, wherein you are required to make payments within 3-5 years period. In the majority of the cases, a portion of the unsecured debt (such as credit card) is paid in this type of bankruptcy. The repayment amount depends on a number of factors including your disposable income, repayment amount, unsecured debts, etc.
They must file a claim with the bankruptcy court to be paid. If they miss the deadline to file a claim, they do not receive anything and the debt is discharged. In a Chapter 7 they are paid their pro rata share of all the unsecured claims file. In a Chapter 13, they are paid a percentage based on how much you can afford to pay. Talk to a skilled Everett, WA bankruptcy lawyer from our team for a FREE consultation! The Everett bankruptcy attorneys with our law firm are here to provide you with answers and solutions to your credit card debt elimination. We understand how overwhelming it can be in tough financial circumstances and therefore provide our services at affordable, flexible rates. Find out the differences between how a Chapter 7 or 13 bankruptcy can be best for you! We make credit card debt elimination easier with our affordable flat low fees. Get in touch today. (425) 249-7156
Sometimes, however, some creditors take a security interest in the property. In such circumstances, the credit card debt becomes a secured debt, which means, the debtor has to pay it off. It is important to remember that once you file for bankruptcy, creditors cannot take you to court and also not make attempts for debt collection. The automatic stay prevents credit card companies and debt collection agencies from contacting you through any means such as telephone, letters. 06.05.2019 15:44:08
We are a consumer-based society. We need you buying things. If you are burdened by trying to pay down this debt, you will not use your retirement income to buy new clothes, go to dinners, take vacations, etc. And that hurts us all even more. While I am not saying to file bankruptcy for the purpose of running up more debt, I am saying that I believe society is benefited more by your ability to spend money and not by paying interest on things you already bought. Remember, most credit card and finance companies run a very profitable business. They will survive a few defaults and do not necessarily have to charge more in interest and fees to everyone else. I believe that the accounts in default are not the reason the credit card companies charge interest and fees. They do so because they are in the profit business, and charging more for a service you want makes them more money. So I do not believe other credit card holders are worse off because you wipe out this debt in bankruptcy. Good luck with your decision.
We'll work with you to get a complete picture of your finances, and then discuss the pros and cons of all the options available to you, we'll answer all your debt settlement and debt consolidation questions, and offer negotiating and debt consolidation advice and provide you with information on our bankruptcy and credit card debt management services. We'll make sure you understand the impact of your choices regarding bankruptcy and credit card debt before you take any action. Our bankruptcy and credit card debt services. If you're certain that bankruptcy is the way you need to deal with credit card debt, we provide bankruptcy counseling certificates mandated by the United State court system. We are approved by the Department of Justice to offer the pre-filing bankruptcy counseling session that the courts require, where we'll provide the analysis that you and your legal counsel need to make well-informed decisions about bankruptcy and credit card debt. And we're approved to provide the post-bankruptcy debtor education course that you'll need to take to have your bankruptcy discharged.
Much of today's population has come to rely on credit cards for daily expenses as a means of getting by. However, not all credit card users have the capability of paying off the debt incurred and end up over their heads before it is too late. Chapter 7 bankruptcy is seen as an easy way out of a bad situation. Below are a few tips or items to know when it comes to filing for Chapter 7 bankruptcy for debts incurred via credit cards: 1. Secured Versus Unsecured Debt When facing bankruptcy, it is important to know the difference between types of debt: secured and unsecured. Secured debts are those that are associated with an asset, such as a car or a home. Unsecured debts are not connected to a specific asset. Credit card debt is a perfect example of unsecured debt given that credit cards are normally used to purchase everyday items, such as clothing, groceries, or other personal or miscellaneous expenses. When it comes to the two different types of debts, unsecured are often given lower priority than secured.
Summary When filing for bankruptcy, a reader want to reaffirm credit card debt, with the hope of still being able to use the card. Chances are slim the card will still be usable. The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs. Dear Credit Guy, In going through a bankruptcy, if you decide to enter into a reaffirmation agreement with a credit card company, does that allow you to continue using the card? — Wayne Dear Wayne, Just so you and I and my readers are on the same page here, when you reaffirm a debt in a Chapter 7 bankruptcy, you are signing a legal document that removes that particular debt from the bankruptcy proceedings. The document would state that you agree to the original terms of the account and will continue to make payments as agreed. Most reaffirmations are done on big-ticket items such as a house or car — in other words, for secured debts that you wish to keep.
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