Bankruptcy has short-term effects that may include a loss of self-respect, inability to apply for credit, and you may feel that you have hurt your good name. These short-term effects are common amongst people seeking to file for bankruptcy, but most can explain that bankruptcy has improved their financial affairs. Having a clean financial start means that your debt has been discharged either in full or partially by the U.S court. Once your debt is discharged your debtors can longer pursue collection and most importantly you will have the opportunity to start building good credit. Filing for bankruptcy may not be your only option. Before filing for bankruptcy you should contact a local state attorney who understands your state law and procedures. Having an examination of the debtor's economic situation will allow the debtor and attorney to develop an appropriate bankruptcy relief program.
The San Diego Bankruptcy Attorneys understand the laws that guide the bankruptcy code including the most popular methods of filing for bankruptcy. Filing for Chapter 7 or Chapter 13 requires a strict assessment of the debtor's economic affairs. Each chapter produces different types of reliefs and options for individuals who wish to consolidate and discharge some of their debt. Filing for Chapter 7 or Chapter 13 requires a consideration of assets and secured property. In many cases, individuals with property and renewable income will file through Chapter 13 to keep all of their belongings. To reach the San Diego Bankruptcy Attorneys please call 619-488-6168. Our attorneys are experts in California Bankruptcy Law and are capable of providing legal guidance to produce a favorable court decision.
Considering bankruptcy is not an easy task when you have worked so hard to build your current credit. However, people with substantial debt can actually improve their credit after they have filed for bankruptcy. Individuals have been able to apply for car loans and mortgage loans within 2 to 4 years of filing for bankruptcy. The debtor must keep in mind that each bankruptcy case is unique and affected by different state laws. The following section will highlight the benefits of filing for bankruptcy, however, you may find additional relief programs depending on the size of your debt.
The Benefits of Bankruptcy
Bankruptcy does not clear all types of debt, but most debt is dischargeable.
Bankruptcy does not cover all types of debt including child and alimony support, penalties and damages owed to the state due violations of the law, and particular tax debts. Child support and alimony support or debt can only be deferred by family courts. Bankruptcy will, however, provide relief to the debts that are dischargeable such as medical bills, debts arising from car accidents (if the accident was not caused by intoxication), and some court fees. For most, a bankruptcy will clear all of their dischargeable debt under Chapter 7.
While bankruptcy may not take care of your non-dischargeable debts, you will find economic relief if you are capable of having some of your debts discharged. To determine the debts that are dischargeable in your state you are encouraged to speak with a local state attorney. If you have different types of debt, bankruptcy may not clear all your debt, but it will definitely alleviate your financial stress.
Filing a full disclosure of financial affairs is difficult, but once it is done, the bankruptcy court will allow you to have a fresh economic start.
Coming clean about your economic affairs is not an easy thing to do. However, coming clean with your economic affairs and then having your debt discharged will produce a great feeling of relief. When you file for bankruptcy you are required to provide a full disclosure of your financial affairs. You can rest assured that the judge hearing your case has probably judged similar situations. When you file for bankruptcy the judge understands that regardless of how you got there, you are bankrupt and need some form of relief. After disclosing your economic affairs you will be capable of starting fresh and protected from any debt collecting actions. Disclosing your financial affairs is the first step and everything that comes after can be taken care of by a legal representative.
Bankruptcy will be reported on your credit report for the 10 years, but it does not mean you will not be able to build good credit.
Many individuals will disregard the benefits of filing for bankruptcy when they consider the time a bankruptcy will appear on their credit report. Credit reports are essential for determining your FICO score which fundamentally allows your lenders or creditors to determine how much money they can trust you with. A credit score is essentially a person's ability to buy property and merchandise, allowing them to establish a credit. However, a good credit score is not defined by a bankruptcy report. Building good credit can begin the day after your debt is discharged through a bankruptcy. By making payments on time and avoiding future debts, individuals who have filed for bankruptcy have been able to improve their credit score regardless of the bankruptcy report. In addition, bankruptcy reports cannot be discriminated against by an employer while you are an employee or an applicant.
Bankruptcy that is reflected in your credit score for 10 years does not mean you will need to wait ten years to apply for credit. As mentioned earlier individuals who have filed for bankruptcy have been able to build their credit score to above 700 within a couple years of filing a bankruptcy petition. If you are considering bankruptcy you will find that your credit report is not a limiting factor to building good credit. Learning to manage your future financial affairs is the most effective way to improve your credit regardless of the bankruptcy report.
Bankruptcy will keep you from using credit cards, but only for a limited time and with certain restrictions.
After you file for bankruptcy you may find difficulty finding a line of credit. If you do find a line a credit it will usually have a high-interest rate. However, high interest rates will reduce once you start building good credit. Once you file for bankruptcy and you have your debt discharged in a court of law, your creditors will be unable to pursue any type of future collection activities. If your creditors harass you through emails or phone calls after your debt has been discharged, you may file a lawsuit for a violation of bankruptcy code. One of the biggest benefits of bankruptcy is the Automatic Stay clause which prevents creditors from repossessing your property and prevents them from attempting any debt collection activities. Once your case is discharged, your case is discharged forever. After having your debt discharged, you will be able to build your credit and be to apply for a credit line within a year of your bankruptcy case.
Filing for bankruptcy will result in losing your property and assets, depending on the bankruptcy Chapter you choose.
When a debtor files for a Chapter 7 bankruptcy, the debtor will have all of their non-exempt property repossessed by a court-appointed trustee who will sell their items and distribute the earnings amongst the creditors. Chapter 7 is a liquidation of your property and assets, however, states provide a list of items that are exempt from repossession. Property under a certain value (determined by the state) can be kept including cars, clothing, and other properties. In Chapter 13, the debtor is capable of keeping all of his or her property. Chapter 13 cases differ from Chapter 7 in that the debtor has the ability to choose the creditors they want to pay in full and choose which debt will be discharged all while maintaining their property and assets. Depending on the size of your debt, you may find Chapter 13 more favorable if you have substantial property and assets. Discussing your situation with a legal professional will clarify many of the questions that arise for individuals with renewable incomes and multiple properties.
Student debt is not covered by bankruptcy, but filing for bankruptcy may protect you from any debt collecting activity from student loan providers.
Bankruptcy does not discharge student debt, however, it can prevent debt collectors from pursuing harsh collection activities. If you have substantial student debt, you may be interested in contacting an attorney who can help you find some relief through the College Cost Reduction and Access Act. If you have different types of debts you are encouraged to create a document of all your debts and examine which debts can be discharged. You might be able to keep up with your college debt payments if you have some of your other debt discharged through bankruptcy. Contact a local attorney who can help you examine your debts and provide more information on the College Cost Reduction and Access Act.
Bankruptcy is embarrassing and may cause you to lose your self-image, but it will allow you to develop a good credit and reclaim your good name.
One of the biggest benefits of filing for bankruptcy is that you will no longer live in fear of intimidating debt collecting phone calls and lawsuits from your creditors. Some may find it more embarrassing to be pursued by creditors for money that they owe. If you are debt more than you could ever pay back, the responsible thing to do is file for bankruptcy. You may feel embarrassed especially when providing a clear depiction of your economic affairs, but the fact of the matter is, bankruptcy may be your only option. Having a chance to a fresh financial start will allow you to rebuild your reputation and rebuild your credit score.
If you are considering filing for bankruptcy you should now have a better depiction of the benefits that arise from having a fresh start. Filing for bankruptcy is not an easy thing to do. First and foremost, you may find discomfort from the idea that you are incapable of paying back your bills. In addition, the bankruptcy codes (the laws that guide bankruptcy petitions) are complicated enough to understand for a person that is not versed in the specific state laws. After contacting a San Diego Bankruptcy Attorney, you will be guided through the bankruptcy process and provided with legal advice so that your bankruptcy petition is accepted. When filing for bankruptcy you should follow the following steps.
First, the debtor needs to create a written document of all of their debts, renewable incomes, property and assets, and costs of living. Keep all your financial records as they may be requested by the court-appointed trustee. Six months before filing for bankruptcy the debtor will be required to receive debt counseling. This process can be done with an approved agency and can be conducted via the internet or a phone call. Individuals wishing to file a bankruptcy petition will need to fill out a Bankruptcy form which can be found using the following link: www.uscourts.gov/forms/bankruptcy-forms. After filling out this form, your creditors will be notified of your bankruptcy petition, then after, you will attend a meeting with your creditors where a repayment program can be examined or produced. If your creditors do not object to your petition, you will follow the bankruptcy regulations described in the chapter you have filed.
Once your petition is cleared in a courtroom, you will either have your debt discharged through a Chapter 7 or you may have your debt resettled using any other form of bankruptcy. The laws that guide the bankruptcy court were created to provide relief for anyone facing economic stress. I
The San Diego Bankruptcy Attorneys believe that there are many benefits that arise after an individual or complex entity files for bankruptcy. After filing for bankruptcy you may find yourself in a better economic standing and capable of establishing a good credit. Some of the biggest benefits of filing a bankruptcy is that you will be protected by automatic stay laws which prevent any future debt collecting activity after a debt has been discharged. To have your case evaluated by an expert or if you are currently filing for a bankruptcy and would like more information on the bankruptcy code, you may contact a San Diego Bankruptcy Attorney at 619-488-6168 or you may visit our offices at 750 B Street, Suite 2510, San Diego, CA 92101