Have you gotten behind on your credit card payments to the point where you are unable to make them? If so, the worst thing you can do is to keep fighting. The way businesses have built up the present debt system is designed to keep you in debt. People who are in debt are a cash cow for credit card companies since, in most situations, all you are doing is paying off the interest.
When everything is finally paid off—if it ever is paid off—that interest keeps adding up, and you could end up paying four or five times your initial loan. Keep reading to learn about a better option and then contact Law Offices of Terrence Fantauzzi at (909) 552-1238 to speak to a bankruptcy attorney.
Put an end to your credit card debt struggle and file for bankruptcy
If you want to avoid this, there is a straightforward way to get rid of your credit card debt: file for bankruptcy. Depending on the form of bankruptcy you apply for, bankruptcy will almost certainly discharge all of your other credit card debt, even while it won’t discharge other types of debt, such your mortgage on your home or car and any child support obligations.
What kind of bankruptcy is best for getting rid of credit card debt?
When trying to eliminate your credit card debt, Chapter 7 and Chapter 13 bankruptcy are two options to think about. For filing, both offer advantages and disadvantages. To determine which bankruptcy chapter is more suitable for your circumstances, let’s examine Chapter 7 and Chapter 13 in more detail.
Filing for Chapter 7 bankruptcy to discharge credit card debt
The majority or the entirety of your unsecured debt that is not a priority is eliminated when you apply for Chapter 7 bankruptcy. Debt that is not secured by a piece of property, like a car or house, is referred to as unsecured debt. Medical bills, utility bills, payday loans, purchases, etc. are examples of unsecured debt. Some priority loans, like as school loans, some tax debts, and child support, cannot be discharged under Chapter 7. Additionally, debt associated with credit card fraud cannot be forgiven.
You will give up your remaining nonexempt property in exchange for the elimination of the majority or all of your unsecured, non-priority debt, so that it can either be sold and the proceeds divided to your lenders, or transferred to your lenders so they can sell it. If you don’t own any nonexempt property, all of your debts will be forgiven.
Filing for Chapter 13 bankruptcy to discharge credit card debt
In contrast to Chapter 7, Chapter 13 bankruptcy requires you to agree to pay a minimal portion of your credit card debt based on your available income. Your remaining unsecured, non-priority debt is erased after you pay this portion of it.
Most persons who file for Chapter 13 bankruptcy only need to pay a tiny portion of their total debt in order to get rid of their existing debt. This payment plan is typically spread out over three to five years, providing you enough time to recover and eventually emerge from the hole debt-free. You can keep your nonexempt property if you file for bankruptcy under Chapter 13. As well as allowing you to lower debt on a property to more properly reflect the actual value of said property, it can halt a mortgage foreclosure.
When I file for bankruptcy, would my creditors stop harassing me?
Your creditors and lenders are required by law not to pursue collection efforts through any means by order of an automatic stay, regardless of whether you file for Chapter 7 or Chapter 13 bankruptcy. Additionally, this automatic stay shields you from being sued for declaring bankruptcy. Now is the time to learn more. Contact Law Offices of Terrence Fantauzzi at (909) 552-1238 to get started.