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  • Everything You Wanted to Know About Bankruptcy Discharge

    Everything You Wanted to Know About Bankruptcy Discharge

    Call: 888-297-6203

    People reeling under the effects of debts often consider filing for bankruptcy. Despite the ill effects of denting your credit history, there are numerous benefits associated with bankruptcy, like, the automatic stay and discharging of debts. A bankruptcy discharge releases you from paying back certain debts after you file for bankruptcy. According to lawyers of Los Angeles based bankruptcy law firm Recovery Law Group, the legal order also prevents creditors from taking any action to collect the outstanding debts which have been discharged by the court. You can live a threat-free life after getting a bankruptcy discharge. The discharge occurs at different times depending on the chapter of bankruptcy.

    Individuals can file for bankruptcy under either Chapter 7 or Chapter 13. In the case of Chapter 13, a repayment plan is involved, through which the debtor pays back certain debts. The duration of this plan is generally 3-5 years and bankruptcy discharge is given after completion of this plan. In Chapter 7, since no repayment of loans is involved, the discharge is given within 4-6 months of the filing of the bankruptcy petition. This timeframe can change if any objections are raised by creditors. However, it is important to know that all debts cannot be discharged in bankruptcy. Certain debts survive bankruptcy and depending on the chapter you have filed under; you will have to pay for them.

    Debts discharged during bankruptcy

    Once you qualify for a chapter of bankruptcy, certain debts can be discharged, provided you are eligible for them. These include:

    • Medical bills
    • Credit card debt
    • Utility bill debt
    • Personal loans from family or friends
    • Business debt
    • Contractual debts
    • Unsecured debts
    • Judgments
    • Attorney fees
    • Missed rent payments
    • Some tax debts
    • Civil court judgments
    • Debts due to your malicious injury of a person/thing

    Debts which survive bankruptcy

    Certain debts, however, cannot be discharged. These depend on the chapter of bankruptcy you have filed under.

    Chapter 7 bankruptcy

    • Student loan
    • Criminal fines
    • Court fees
    • Car loans
    • Child support and alimony
    • Debts secured by a lien
    • Debts resulting from malicious injury to another person or thing
    • Debts due to DUI resulting in death or personal injury
    • Mortgages

    Chapter 13 bankruptcy

    • Child support and alimony
    • Mortgages
    • Student loan
    • Some tax debts
    • Criminal fines
    • Debts due to personal injury or death caused due to driving under the influence

    Certain debts can be discharged, provided a creditor does not file a motion against them, resulting in them being declared non-dischargeable. These include civil court judgments and debts which were a result of fraud.

    Life after bankruptcy discharge

    Official copies of the discharge are sent by the court clerk to all creditors named and listed during bankruptcy proceedings. Apart from this, copies are also sent to the bankruptcy trustee and their lawyer as well as debtor and their lawyer. Bankruptcy discharge notice prevents creditors from pursuing any collection action for debts discharged. Any attempt to contact you to collect payment can result in action against creditors. However, creditors with a loan secured by a lien can repossess the property even after discharge if you do not make regular payments. Consulting a lawyer, in this case, might be essential. You can call 888-297-6023 to consult with experienced bankruptcy lawyers.

    Once you get your bankruptcy discharge, it appears on your credit report and remains on it for a duration of 7-10 years depending on the chapter of bankruptcy you filed. While Chapter 7 bankruptcy remains for ten years, Chapter 13 for seven years from the date of filing. This has a negative effect on your credit score and hampers your chances of getting credit. The accounts discharged as a result of bankruptcy should show that status on your credit report. In case it is not so, you can get it updated through credit bureaus by providing them with the “schedule” document from bankruptcy records.


      *Are you more than 60 days past due on your mortgage?

      *Do you own a home?

      Are you currently working?

      By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

    • Can Bankruptcy Affect Your Chance of Getting Mortgage?

      Can Bankruptcy Affect Your Chance of Getting Mortgage?

      Call: 888-297-6203

      Overwhelming debts require you to take some action if you wish to avoid repossession, foreclosure or lawsuit. Bankruptcy can be a way out, but you pay the price for it. You end up hurting your credit rating for as long as ten years in case of a Chapter 7 bankruptcy and seven years in case of Chapter 13 bankruptcy. Getting credit after bankruptcy can be extremely difficult. Thus, if you wish to get a mortgage, bankruptcy can be bad!

      According to Dallas based bankruptcy law firm Recovery Law Group lawyers, bankruptcy lowers your credit score considerably, making it difficult for people to get mortgage loans, especially post-bankruptcy. After some time, the negative effects of bankruptcy lessen, and lenders might consider your credit building efforts before agreeing to your mortgage. It is important to ensure that your credit-building efforts are reported to the credit bureaus so that your credit report is updated. Any incorrect or outdated information displayed on the credit history can hamper your chances of getting any kind of credit, including the mortgage.

      Effect of different bankruptcy types on mortgage loans

      The type of bankruptcy and discharge affect the establishment of a new line of credit. Here’s a look at various bankruptcy types:

      • Chapter 7

      In this liquidation bankruptcy, the non-exempt property is sold off to pay your unsecured debts like credit card debt, etc. This bankruptcy stays on credit report for 10 years. After waiting some time has passed since bankruptcy discharge and with a large down payment, you might get a mortgage loan.

      • Chapter 11

      Usually meant for businesses, it can also be used by individuals. People who have more money to qualify for Chapter 7 and more debt than allowed in Chapter 13 can choose this option. The chapter is complex and expensive. After some time, post-bankruptcy discharge, you can qualify for a mortgage.

      • Chapter 13

      Debtor repays some portion of the debt through a court-approved repayment plan over 3-5 years. Any remaining unsecured debt is discharged. The bankruptcy remains on credit report for 7 years. People who wish to take mortgage after this should consult their bankruptcy trustee.

      Mortgage loan varieties

      Different types of mortgage loans are available after bankruptcy, each with a unique requirement.

      • Federal Housing Administration (FHA) Loans

      Managed by the federal government, they require very low down-payment. However, you must pay for mortgage insurance which increases the monthly payments. There is a waiting period associated with different bankruptcy chapters. For Chapter 7, two years from discharge date, for Chapter 13, one year from discharge date while no waiting period for Chapter 11 bankruptcy.

      • USDA Loans

      U.S. Department of Agriculture loans are for rural borrowers. People who aren’t eligible for conventional loans, with modest income can opt for this loan for a house in a rural area. no-down-payment and low-interest rates are a great reason to choose it. you need to wait three years from discharge date in Chapter 7 bankruptcy, one year from discharge date for Chapter 13, and no waiting period for Chapter 11 bankruptcy.

      • VA Loans

      This one is for veterans and personnel currently serving in the military. There is no down-payment in the Department of Veteran Affairs loan. They do not charge private mortgage insurance and offer loan at low-interest rate too, however, a funding fee (percent of home price) is required. The waiting period in case of Chapter 7 is two years from discharge date; one year from discharge date for Chapter 13, while no waiting period for Chapter 11 bankruptcy.

      • Conventional Loans

      These loans are not guaranteed by any government agency; hence the norms are stricter than the others. You require a good credit score, should put 20% of house’s cost as down-payment and additional private mortgage insurance. Even the waiting requirements are longer. For Chapter 7 and Chapter 11, it is four years from the discharge date; while it is 2 years from discharge date or 4 years from dismissal date for Chapter 13.

      The best way to get approval for a mortgage after bankruptcy is by focusing on rebuilding credit. The basic steps involved are creating a budget and avoiding spending more than your limit; paying your bills on time to avoid getting into debt and getting a secured credit card which reports your payments to the credit bureaus. Once you get your credit rating in order, getting mortgage won’t be tough. bankruptcy might prove to be a hurdle in your search for the perfect home, but with experienced lawyers by your side, things are smooth. To consult with qualified bankruptcy lawyers, you can call 888-297-6023.


        *Are you more than 60 days past due on your mortgage?

        *Do you own a home?

        Are you currently working?

        By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

      • How Difficult is it to Get Credit After Bankruptcy?

        How Difficult is it to Get Credit After Bankruptcy?

        Call: 888-297-6203

        Though bankruptcy can help you get rid of your debts, getting credit after bankruptcy discharge is easier said than done. Fresh out of bankruptcy, people find it difficult to get a creditor to approve their loan petition. This is because bankruptcy stays on your credit report for a long duration. Chapter 7 bankruptcy stays for 10 years since no debt payment is made in this case. In the case of Chapter 13 bankruptcy, since some portion of debts are paid, this bankruptcy remains on your credit report for seven years.

        Los Angeles based bankruptcy law firm Recovery Law Group says that the negative effect of bankruptcy can last for some time after getting a discharge. This is because the creditors do not receive any money that was owed to them. With bankruptcy on your credit report, prospective creditors are warned of the risk associated with lending money to a person who is fresh out of bankruptcy. Such people find it difficult to get credit at reasonable rates and end up getting high-interest rates credit cards, especially just after a bankruptcy discharge.

        Rebuilding credit is possible!

        The primary step is to check whether, after bankruptcy, your credit score is reported correctly on your credit report. Once you are aware of your credit score, you can start making efforts to rebuild your credit. Primary steps involve paying bills on time and getting under as little debt as possible. Other possibilities include:

        • Secured credit card

        This is one of the best ways to rebuild credit. These cards require a security deposit for account opening. This amount decides the credit limit. Making monthly payments on this card and living within means help you improve credit score. The card has a lower interest rate than normal unsecured credit cards. However, if you don’t pay the amount due, interest is added.

        • Become an authorized user with someone else’s card

        You could ask a friend or relative with excellent credit to make you an authorized user on their credit card. This will slowly help build your credit score since the primary account holder pays bills on time. In case the primary cardholder also has a large amount of debt or is behind his payments, this could affect your score negatively. Thus, you should choose the primary user carefully.

        • Credit-builder loan

        These are small personal loans which are aimed to provide people out of bankruptcy with financial assistance to improve their credit. On-time payments on such loans are reported to major credit building agencies which improve your credit rating.

        Bankruptcy is a major decision which should not be taken lightly. For knowing more about bankruptcy proceedings and its effect on your credit score, call 888-297-6023 to speak with experienced lawyers.


          *Are you more than 60 days past due on your mortgage?

          *Do you own a home?

          Are you currently working?

          By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

        • Is It Possible to Get a Credit Card After Declaring Bankruptcy?

          Is It Possible to Get a Credit Card After Declaring Bankruptcy?

          Call: 888-297-6203

          Bankruptcy can tank your credit score. This fact is probably one of the most common reasons why people fear filing for bankruptcy. However, it will be surprising to know that rebuilding your credit score requires credit cards! According to Los Angeles based bankruptcy law firm Recovery Law Group , people fresh out of bankruptcy will find it a bit difficult to get the kind of credit cards they want. This is because bankruptcy alerts lenders of the inability of the individual to repay. Any credit card you get post-bankruptcy will charge you a higher rate of interest than normally applicable.

          Consumer bankruptcies which appear on credit report generally belong to Chapter 7 or Chapter 13. While the former is discharged within 3-6 months, the latter involves repaying some part of your loan through a court-approved repayment plan and generally takes 3-5 years. Bankruptcy becomes public record and stays for 7-10 years on your credit report depending on the chapter of bankruptcy you have filed under. In case you need to apply for a credit card before your bankruptcy is discharged, it becomes a bit difficult. It is important to have legal representation so that you are aware of any restrictions in this matter. If you need consultations with experienced bankruptcy lawyers, call 888-297-6023.

          The best way to improve your credit rating after bankruptcy is by re-establishing credit. This is done by using credit cards. Though it might seem that you will end up making the same mistakes again, it is not so. Instead of using credit cards with a high-interest rate, you should opt for secured credit cards through a local bank. With a fixed sum of money in your account as a guarantee, you will be able to get credit up to a fixed limit. Keeping your purchases limited to essential items and making payments on time can result in slowly but steadily improving your credit ratings. With time, the secured credit card might get converted into an unsecured one. Sometimes, lenders might not report the secured credit card accounts to credit reporting agencies. This might affect your credit-building efforts negatively, hence inquire about this in advance and plan your strategy accordingly. Rebuilding credit requires time and patience. You need to continuously make efforts to improve the situation in order to lead a normal life.


            *Are you more than 60 days past due on your mortgage?

            *Do you own a home?

            Are you currently working?

            By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

          • Know the Difference Between Chapter 7 and Chapter 13 Bankruptcy

            Know the Difference Between Chapter 7 and Chapter 13 Bankruptcy

            Call: 888-297-6203

            Individual debtors can file for bankruptcy under Chapter 13 or Chapter 7. In the case of chapter 13, you are required to repay some part of your loan over a period of 3 to 5 years through a court-approved plan. Since some portion of the debt is paid, lawyers of Los Angeles based bankruptcy law firm Recovery Law Group inform that the credit report shows this bankruptcy for only seven years.

            On the other hand, under Chapter 7, you don’t repay any debt and thus, the bankruptcy remains on the public record and your credit report for 10 years from the date of filing. Bankruptcy can have a negative effect on your credit report as well as credit history. To help get back on track, you need to take of professional assistance from credit counselors as well as experienced lawyers. It is important to keep paying monthly bills on time to ensure that your credit history improves steadily.

            Just as Rome was not built in a day, rebuilding your credit will also take time. Managing your finances, making payments on time and staying away from unnecessary expenditure will yield positive results in the long run. To consult expert attorneys, you can contact 888-297-6023.


              *Are you more than 60 days past due on your mortgage?

              *Do you own a home?

              Are you currently working?

              By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

            • All You Need to Know About Chapter 7 Bankruptcy

              All You Need to Know About Chapter 7 Bankruptcy

              Call: 888-297-6203

              People with limited income who have accumulated a huge amount of credit card and personal loan debt have the option of filing for bankruptcy under Chapter 7. Dallas based bankruptcy law firm Recovery Law Group lawyers elaborate that in this liquidation bankruptcy, your non-exempt property is sold off to repay your debts. In case you wish to protect your assets, Chapter 13 bankruptcy is a better option. This type of bankruptcy is known as a reorganization plan, where, in a court-approved repayment plan is used to pay off your debts over 3-5 years’ timeframe.

              What effect does Chapter 7 bankruptcy have on your life?

              Filing for bankruptcy has an adverse effect on your credit score. Bankruptcy stays on your credit report for 7 years in the case of Chapter 13 and 10 years in the case of Chapter 7. However, over time, this negative effect decreases, and your credit score improves. The various concerns people have while filing for bankruptcy include:

              • Can you lose home and your possessions on filing for Chapter 7 bankruptcy?

              The federal and state exemptions allow you to keep your property up to a fixed dollar limit. In case you have property exceeding your exemptions, the non-exempt property is sold off to pay your debts.

              • What property can be kept during a Chapter 7 bankruptcy filing?

              Exempted property limit is capped. Bankruptcy filer can choose between state and federal exemptions (if it is allowed in their state). The various federal property exemptions include –

              • Homestead: $23,675 of equity can be retained in-home, burial plots or mobile homes. You can use this entire amount to protect your home or use up to $11,850 for any other property.
              • If your home equity is less than $23,675, your home might not be sold off, though a lender may foreclose if you are behind mortgage payments. If your equity is more than $23,675; the house is sold, you receive the exempted amount and the remaining amount is used to pay off debts.
              • Motor vehicle: up to $3,775.
              • Personal property: $600 per item (books, pets, musical instruments, appliances, ) with total exemption up to $12,625.
              • Health aids: completely exempted.
              • Retirement accounts: entire savings of 401(k) or 403(b) and IRA savings up to $1,283,025.
              • Jewelry: up to $1,600.

              Married couples can double the exempted amount by filing bankruptcy together.

              • Who can qualify for Chapter 7?

              A person can file for Chapter 7 bankruptcy if their income is less than the state median for household of a similar number of members. If your income is more than the state median, you need to pass the means test. In this case, your disposable income is calculated, deducting all necessary expenses (food, household needs etc.) from your income. If this amount after multiplying by 60 is less than $7,700 then you can file for Chapter 7 bankruptcy. If this amount is between $7,700 and $12,850, then your ability to pay at least 25% of your unsecured debts is assessed. If you have enough disposable income to pay for 1/4thof your unsecured debts, you are eligible for Chapter 7 bankruptcy.

              • What happens if you fail the means test?

              People whose income is more than the state median are required to take the means test. If their disposable is above $12,850, they are not eligible for this chapter of bankruptcy and need to file for Chapter 13.

              • Is Chapter 7 better than Chapter 13?

              Chapter 7 bankruptcy is ideal for those who have limited income add want to get rid of debts. In the case of chapter 7, equity in the non-exempt property is sold off to repay your creditors. On the other hand, people who have huge amounts of debts and wish to protect their property should file for Chapter 13 bankruptcy.

              • Which debts are eliminated on filing for Chapter 7 bankruptcy?

              Secured debts such as those protected by assets like a car or home cannot be discharged in bankruptcy. Additionally, certain debts like a student loan, alimony, child support, tax debts, etc. are also not eliminated after bankruptcy. However, unsecured debts like credit card bills, personal loan, medical debt are discharged, within 4 to 6 months in the case of Chapter 7 bankruptcy.

              If you are facing financial issues and struggling to make ends meet, it is important to consult experts. You can contact experienced bankruptcy lawyers at 888-297-6023 to discuss your case and eventually file for bankruptcy. They will guide you through the procedure of filing for Chapter 7 bankruptcy, provide you qualify for it. Filing for bankruptcy under Chapter 7 costs $335 which can be paid in 4 monthly installments (after seeking permission) or the fee waived off depending on circumstances.


                *Are you more than 60 days past due on your mortgage?

                *Do you own a home?

                Are you currently working?

                By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

              • What is Bankruptcy?

                What is Bankruptcy?

                Call: 888-297-6203

                It is not uncommon to find people struggling with finances. You will find several People struggling with debt every year in the U.S. Bankruptcy has emerged as a popular way to get rid of a huge amount of debts. Consumers can file for bankruptcy under Chapter 7 or Chapter 13 and these are reflected in the consumer’s credit report. According to Dallas based bankruptcy law firm Recovery Law Group in Chapter 13, you end up repaying a portion of your debt as per a court-approved repayment plan over a course of 3-5 years. Due to this, the bankruptcy information remains on your credit report for seven years from the date of filing. In the case of Chapter 7 or liquidation bankruptcy, your entire debts are forgiven. Since no debt is paid to the creditors, this type of bankruptcy remains on the credit report for 10 years from the date of filing.

                Though bankruptcy can affect your credit report negatively and can have detrimental effects on your credit history as well as your credit score, it can also provide you with a reality check and a fresh start. People who have already been having bad credit get a chance to make amends and start afresh. If you wish to know more about bankruptcy and your other options, contact expert bankruptcy lawyers at 888-297-6023.


                  *Are you more than 60 days past due on your mortgage?

                  *Do you own a home?

                  Are you currently working?

                  By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

                • Do You Know How Long Bankruptcy Stays on Your Credit Report?

                  Do You Know How Long Bankruptcy Stays on Your Credit Report?

                  Call: 888-297-6203

                  Struggling to manage your finances is more common than you think. When people have a huge amount of debts like credit card bills, student loan, etc. filing for bankruptcy might be an excellent way to get rid of them. However, there are consequences to this act warn Dallas based bankruptcy law firm Recovery Law Group lawyers. Bankruptcy can negatively affect your credit rating. Depending on which chapter of bankruptcy you file, it could remain on your credit report for as long as 10 years. However, people without any other option might end up filing for bankruptcy.

                  Prior to the bankruptcy filing, it is advisable to seek expert opinions, such as that of a non-profit credit counselor or an experienced bankruptcy attorney. This will help them get knowledge about other viable options like debt management, debt settlement, etc. In case filing for bankruptcy is the best choice, you can consult with expert lawyers at 888-297-6023 to find out which chapter of bankruptcy would suit you best.

                  Which chapter of bankruptcy should you choose?

                  If bankruptcy is the best way to get rid of your debts, you need to decide between Chapter 7 and Chapter 13. Filing for bankruptcy requires an assessment of your income, assets, as well as your debts. Changes in laws being made in 2005, it is not easy to get rid of debts through bankruptcy. Certain debts like a student loan, income tax, alimony and child support or other government fines cannot be discharged through bankruptcy. Individuals who have an income less than the state median for an equal number of household members are eligible to file under Chapter 7. For others who fail to qualify the means test, Chapter 13 bankruptcy is the best bet to get rid of debts. Both chapters affect people differently.

                  Chapter 7: In this type of bankruptcy, all unsecured nonpriority debts are discharged without paying anything back. Since no debts are repaid, this bankruptcy remains on your credit report for a period of 10 years.

                  Chapter 13: In this case, the debtor pays some portion of their debt through a court-approved plan over a previously agreed timeframe. Any remaining unsecured nonpriority debt is discharged after that duration. Since some part of the debt is paid, this chapter of bankruptcy remains on your credit report for 7 years only.

                  The credit agency automatically removes the bankruptcy from the credit report after seven or ten years depending on which chapter of bankruptcy it was filed under. Most people who file for bankruptcy have delinquent accounts. These accounts are also deleted seven years from the date they became delinquent. Since in most cases, the accounts became delinquent prior to the bankruptcy filing, they will be deleted prior to the bankruptcy public record.

                  Effect of bankruptcy on your credit

                  Bankruptcy filing makes you a high-risk candidate for lending. Thus, you will either not get a loan, or get one at a higher interest rate. It may also hamper your chances of getting a decent job. Thus, it is important to make immediate efforts to rebuild your credit to increase your credit score. This can be done by paying bills on time every month, not taking out unnecessary debt and living strictly as per a designed budget. With better credit score, soon, you will be able to get a loan at lower interest.


                    *Are you more than 60 days past due on your mortgage?

                    *Do you own a home?

                    Are you currently working?

                    By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

                  • Everything You Wanted to Know About Bankruptcy

                    Everything You Wanted to Know About Bankruptcy

                    Every now and then, individual and businesses go overboard with their expenditure. This might result in them going under. Bankruptcy is a legal way to get rid of the entire amount or some portions of the debt. However, there are long term effects of filing for bankruptcy, the major being, bankruptcy remains on your credit report for 7 to 10 years depending on which chapter you filed under. This may adversely affect your ability to get a loan at a favorable rate, open credit card accounts, etc.

                    Since bankruptcy is a complex process involving lots of paperwork, it is advised to seek guidance from experts like the Dallas based bankruptcy law firm Recovery Law Group. It is also mandatory for an individual to complete a credit counseling course from a government-approved counselor in order to create a budget for monthly expenses. Individuals can file for bankruptcy under either Chapter 7 or Chapter 13. Both chapters can help in getting rid of unsecured debts, as well as stop all kind of collection actions including foreclosure and wage garnishment.

                    Chapter 7 Bankruptcy

                    This is also known as liquidation bankruptcy. A bankruptcy trustee supervises the sale of non-exempt property to pay off your creditors. Any debt which remains is discharged. Certain debts like alimony and child support, student loan and certain government taxes are not eliminated even after bankruptcy. Filing for Chapter 7 has consequences; you end up losing some of your property, your bankruptcy is reflected in your credit score for 10 years. Additionally, if you end up in a financial mess again, you will not be able to file under this chapter for 8 years.

                    Chapter 13 Bankruptcy

                    In this case, you can keep your assets by paying for them along with repaying your debts through a court-approved repayment plan over a period of 3 to 5 years. After the duration, any remaining debts are discharged, even if only part payment is done on them. This bankruptcy allows you to keep your assets while repaying some debt. Moreover, this bankruptcy is reflected in your credit report for 7 years only and you can file for bankruptcy under the same chapter after 2 years of discharge.

                    Common bankruptcy terms

                    Some common bankruptcy terms people come across during their discussion with lawyers are –

                    • Bankruptcy trustee: A person/corporation appointed by the court to review the petition, assess the property, oversee the sale of assets and disburse the proceeds among creditors in case of Chapter 7 bankruptcy. In a Chapter 13 case, they also oversee the repayment plan, receive money from debtor and pay it to the creditors.
                    • Bankruptcy discharge: Completion of bankruptcy proceedings results in discharge. In Chapter 7 this takes place when assets are sold and creditors are paid, in Chapter 13, after completion of the repayment
                    • Credit counseling: A compulsory course of action prior to filing for bankruptcy. You are required to complete a personal financial management course through government-approved credit counseling agency before bankruptcy discharge. This can be waived off under special circumstances.
                    • Exempt property: State and the federal government allow bankruptcy filer to keep some property. this cannot be sold to repay creditors. Generally, some equity in the home, vehicle, work tools, household items, etc. is exempted.
                    • Lien: Legal action which allows the creditor to hold or sell debtor’s real estate for security or debt repayment.
                    • Liquidation: Selling of non-exempt property of the debtor in order to generate cash to pay off the creditors.
                    • Means test: A test used to determine the ability of a bankruptcy filer to repay their debts. This considers the filer’s assets, income, expenses, and Failure to pass means test disqualifies them from filing under Chapter 7. Individuals can then file for Chapter 13 bankruptcy Dallas.

                    What happens after a bankruptcy discharge?

                    People might end up losing some property when they file for bankruptcy. It also has long term effects on your credit report. Depending on the chapter of bankruptcy, bankruptcy remains on credit report for 7-10 years. You might face difficulty in getting a loan, or if offered it might be at a higher rate of interest. In case your loan was co-signed by your spouse or parents, they might also face some problems if you file for bankruptcy. Getting a mortgage becomes difficult for bankruptcy filers. They need to give a larger down payment, get a mortgage at the higher interest rate. Reaffirming current mortgage is a better alternative.

                    It is important to have credit information updated on your credit report if you wish to avail credit at favorable terms. This can be done by rebuilding credit, paying bills on time, living within budget, etc. it is important to consider bankruptcy alternatives like debt consolidation, debt settlement, etc. prior to filing. To know more about bankruptcy options, contact experienced lawyers at 888-297-6023.


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