Category Archives: Bankruptcy
How Long Does Bankruptcy Affect Your Life?
When actor and Celebrity Wife Swap TV star Gary Busey filed bankruptcy in 2012, he said it was a wake-up call and an opportunity to create better money management habits. Unfortunately, many bankruptcy debtors don’t answer the phone and don’t make necessary lifestyle changes. These debtors often anxiously watch the calendar until the seven… Read More »
Can You File Bankruptcy on Medical Bills?
Yes. Medical bills, like credit card debts, are unsecured debts. Usually, such debts are dischargeable in both a Chapter 7 and Chapter 13. That’s good news for families. High medical bills are, by far, the leading cause of consumer bankruptcy filings in the United States. Bankruptcy offers relief in other areas as well, mostly… Read More »
Can a Retiree File for Bankruptcy?
Yes, a retiree can file for bankruptcy, but these cases involve some special issues, which we examine below. As late as the 1990s, “gray” bankruptcies were almost unheard of. These filings have increased almost 70 percent since then, even though overall bankruptcy filings have dropped by almost as much. A combination of a longer… Read More »
What is the Downside of Chapter 7?
Credit score effect and social stigma are the two biggest downsides of Chapter 7 bankruptcy. Banks overstate the effects of these downsides, and unfortunately, many people believe bank propaganda. Filing bankruptcy lowers, but doesn’t “ruin,” a credit score. Usually, repeated late payments, chargeoffs, and other negative information have already ruined it. Additionally, while bankruptcy… Read More »
How to Maximize the Property Exemptions in a Consumer Bankruptcy
Yes, we admit this title sounds a bit dull. But for debtors with significant home equity or other large assets, maximizing the exemptions could be the difference between a fresh start, which the Bankruptcy Code is designed to achieve, and a total loss, which the Bankruptcy Code is designed to avoid. During bankruptcy, the… Read More »
Why Should I File Chapter 13?
Most people file Chapter 13 bankruptcy if their debts are too large to pay all at once, and they need a payment plan. Chapter 13 payment plans are much more debtor friendly than the “payment plans” creditors offer. Chapter 13 offers income-based repayment plans that usually last five years. Usually, that’s more than enough… Read More »
Bankruptcy and Tax Discharge: Basic Rules
Most people voluntarily pay all their taxes on or before the due date. But 15 percent of taxpayers either don’t pay in full or don’t pay at all. That percentage may seem small, but given that the American IRS bill is over $1 trillion a year, that’s a lot of money. And, the IRS… Read More »
Chapter 13 and Chapter 7: What’s the Difference?
One of the biggest differences between Chapter 13 and Chapter 7 is the statement they make to the court. People who file Cahper 13 basically state that they can pay all their debts, but they cannot pay them at once, and they need a payment plan. Chapter 7 files essentially state that they cannot… Read More »
Debt Settlement or Bankruptcy: Which One is Best?
Usually, bankruptcy is hands-down more effective than debt settlement. Bankruptcy is a court-supervised process that’s guaranteed to provide relief to distressed debtors. The general bankruptcy process is outlined below. Debt settlement works on the simple principle that something is better than all of nothing. But during non-bankruptcy debt settlement, creditors usually decide how much… Read More »
Bankruptcy, Home Ownership, and Lasting Protections
Many people file bankruptcy because they’re behind on mortgage payments and need the protection of the Automatic Stay. Regardless of the amount of delinquency, and even if the foreclosure sale is scheduled for later that day, Section 362 of the Bankruptcy Code stops foreclosure in its tracks. The Automatic Stay is only part of… Read More »
