Tag: bankruptcy

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The Fair Credit Report Act (FCRA) controls what the creditors report to credit bureaus. They are required to report the information accurately. After getting your bankruptcy discharge, the creditors should report the discharged debts as discharged during bankruptcy and have zero balance. Dallas based bankruptcy law firm Recovery Law Group says that the best way to check that your creditors have reported the information accurately is to check your credit report after 30-60 days of receiving a discharge. You need to check all three credit bureau reports for any discrepancy in accounts included in bankruptcy and that they are showing zero balance after a bankruptcy discharge.

In case any creditor reports the status of your accounts incorrectly, you should dispute through FCRA. It is mandatory for the creditor to mention any debts included and discharged in bankruptcy with zero balance. Incorrectly representing them as having balance, late, being active, charged-off or as new debt should be reported to FCRA. In case you file for Chapter 13 bankruptcy, your debts don’t appear as included in bankruptcy with zero balance till the time you get your bankruptcy discharge. This takes place after the end of the repayment plan (5 years). However, as per the credit agreement, after you file for bankruptcy, the creditors stop reporting the debt to credit bureaus. In case they continue reporting, it should be as per the confirmed chapter 13 plan. This results in a slow and steady improvement of your credit report before even you get a discharge. Any dispute can be brought up through FCRA.

There are rules as to how creditors should report any debt that has been included in chapter 13 bankruptcy. In case you are contemplating bankruptcy, a lawyer will help you decide whether Chapter 7 or chapter 13 would suit you better. You can consult with experienced bankruptcy lawyers at 888-297-6023to discuss your case.

Filing for bankruptcy should be taken seriously, and should not be undertaken unless it’s the only option. It is a complex process, thus, it is advisable to hire a competent and extensively experienced bankruptcy lawyer, who can successfully help you to avoid bankruptcy. A lawyer will help in negotiation with the creditors and also in creating a more feasible repayment plan. He can also help you in learning about your consumer rights and can let you know about any statutes of limitation that might be applicable to your debts.

Student Loan Debt

In bankruptcy, obtaining relief from student loan debts is more challenging than other types of debts. In such a case, a good bankruptcy attorney can better assess the chances of having the debt discharged, and can also talk to federal and private student loan providers to avoid bankruptcy or restructure a more feasible repayment plan.

Save Yourself from Debt Consolidation Companies

Financial binding can compel you to give in to the temptation of debt consolidation. Debt consolidation companies are very good at taking advantage of the vulnerability of financially struggling consumers. Many of such companies mislead you with their ‘too good to be true’ claims and also promise you to quickly fix your financial problems.

Ways to Avoid Bankruptcy

Given below are some key ways to avoid bankruptcy as per the U.S. News and World Report.

• Have a negotiation about your debts with your creditors.
• Request your family and friends to lend you some money.
• You can sell your real estate or jewelry.
• Restructure your mortgage in case you own a home.
• Make sacrificial lifestyle changes, like going on trips less often or not at all.

However, in case bankruptcy is your only option, create a property protection plan with your bankruptcy lawyer, and not by yourself. You might end up making unintentional fraudulent transfers of assets or hiding them. Thus, consulting the best bankruptcy lawyers of Los Angeles & Dallas, TX, like the Recovery Law Group, will help you to protect your assets without going against the law. You can reach them at Recovery Law Group or at 888-297-6203.

Call: 888-297-6203

Emerging from bankruptcy might seem like an uphill battle to you. Filing for bankruptcy has a serious hit on your credit score and leaves a negative mark on your credit report for some years. Chapter 7 and Chapter 13 bankruptcy remain on the credit report for 10 years and 7 years, respectively. In many states, even the auto insurance rates increase because of a low credit score.

A low credit score does adversely affect the financial aspects of your life, but you can still work towards re-building them. Given below are 7 tips that can help you in improving the credit score, after declaring bankruptcy.

1. Make sure that you always make timely payments of your complete balance. Otherwise, late payments will stain your credit report for 7 years.
2. Use a secured credit card. You will be asked to make a deposit to act as collateral. This deposit will be returned to you, once your credit score gets improved or you close your account. Making timely payments will eventually make your credit score better, and this will make you eligible for getting a new credit card, having better features and rewards.
3. Showing regular and timely payments will have a good impact on your credit score. So, try to use your credit card at least once every month.
4. Multiple credit applications might decrease your credit score and will also increase the risk of overspending. Thus, keep only one credit card in use.
5. Your credit utilization should be low. It is the ratio of your balance to the credit card limit which should preferably be under 30%. So, in case, you have a credit limit of $1,000 each month, then you must not spend more than $300.
   Individuals, who are coping with Chapter 13 bankruptcy, can maintain a low credit utilization by getting a retirement plan loan. Such loans usually have a low rate of interest and credit bureaus don’t get to know about them. It should certainly be small enough to be easily paid back within 5 years, as unpaid balances are considered an early retirement distribution and are subjected to penalties and taxes.
6. Credit bureaus like it when you exercise restraint. So, keep your credit limit higher, since, though a lower credit limit may feel safer, it will eventually cause a rise in your utilization of credit. For example, your credit limit is $1,000 and you spend $400, then your credit utilization will be 40%. On the other hand, if your credit limit is $500, and you spend $300, the credit utilization will double to 80%, and this won’t impress the credit bureaus.
7. Open a savings account that will aid in making bill payments on time by setting up automatic payments. You can also create a small emergency fund. Making a budget, to properly understand and keep a track of the spending habits, will be an effective way for you to improve credit score.

Keep in mind that credit bureaus can also make mistakes. So make sure that you get a no-cost copy of your credit report and check it for any possible errors. There are chances that you might have been mixed with someone else with a similar name, or the report still shows the status of your closed accounts as open. Even identity theft can cause possible errors in your credit report. Such common mistakes can be corrected, and this will also improve your credit score immediately. So, it’s better to check the credit report consistently.

You can learn more about ill-effects of filing bankruptcy on the debtor’s credit score and ways to rebuild them by consulting one of the most experienced bankruptcy attorneys of Los Angeles, Dallas, TX, either at Recovery Law Group or at 888-297-6203.

Call: 888-297-6203

When you file for bankruptcy, the entire process is conducted by United States bankruptcy trustee. they are responsible for overseeing the bankruptcy process in federal courts. They are appointed by U.S. attorney general and their duties include:

• enforcement of Bankruptcy Code
• preventing fraud claims
• appointment and supervision of private bankruptcy trustee
• acting as trustee in consumer bankruptcy cases
• referring cases for investigation, prosecution or any other legal action
• convening creditors meeting for the reorganization of debts
• making sure that no unreasonable fees are charged for filing bankruptcy
• ensuring that estate administration is done quickly, efficiently and properly
• making sure that bankruptcy court rules and procedures are followed
• reviewing applications for professional services disclosures

According to Los Angeles based bankruptcy law firm Recovery Law Group  once you file for bankruptcy, The U.S. trustee appoints an impartial private trustee to administer your bankruptcy (Chapters 7, 12 or 13). The different chapters of bankruptcy require different actions from the trustee.

Chapter 7 or liquidation bankruptcy

In this case, private trustees are appointed to the panel of U.S. Trustee in the federal judicial district who work on a rotation basis. Their work includes accumulation of non-exempt assets, liquidation of the same and distribution of the funds so generated among your creditors.

Chapter 12 and 13 or reorganization bankruptcies

Trustees for these bankruptcy chapters have a standing appointment for the administration of these bankruptcy cases in specific regions. Both these chapters’ help get rid of debts through a repayment plan. The trustee will gauge your financial condition and recommend a repayment plan (to be completed within 3-5 years) accordingly. Once the plan is evaluated and approved by the court, it is the trustee’s responsibility to administer the plan. They will collect the funds from the bankruptcy filer and distribute them to the creditors.

Though the role played by trustees is vital, however, they are not responsible for providing legal counsel to bankruptcy filers. The bankruptcy trustees’ loyalties lie with the bankruptcy court. To consider your legal interests, you need to hire bankruptcy lawyers. If you are looking to get rid of overwhelming debts that have caused enough personal and financial stress on your life, you can consult with experienced bankruptcy attorneys at 888-297-6023.

Call: 888-297-6203

If you think that bankruptcy is going to be a permanent black mark on your credit report, then you are mistaken. Bankruptcy remains on your credit report for a period of 7-10 years and even during this duration you can apply for mortgage say lawyers of Dallas based bankruptcy law firm Recovery Law Group. If you are looking for applying for mortgage loans, here are some things that can help you:

Re-establish Credit

It takes a lot of time to rebuild your credit and you need to be patient during the process. Once you are through with a bankruptcy, the first step you should take is to get a credit card, preferably a secured one. In such cards, you need to put some money as collateral which serves as a limit for that card. Once you become accustomed to paying bills on time and spending within the limit, you can opt for an unsecured credit card. You can use credit cards to buy things that you can need and can afford to pay for at the end of the month. In a nutshell, you need to treat your credit card like your debit card in order to improve your credit score.

Building your credit history is vital if you wish to improve your chances of getting a mortgage. To do this you need to make efforts using various credit cards. Once this is done you might find it easier to get a personal loan or car loan debt too.

• Getting Mortgage

The minimum waiting period for people who wish to take a mortgage to get a new house is one year after bankruptcy discharge or dismissal. However, the time taken in getting mortgage depends on the type of bankruptcy as well as the loan you wish to get.

• FHA Loans

An excellent mortgage option after bankruptcy! In the case of Chapter 7 or Chapter 11 bankruptcy, the bankruptcy discharge or dismissal should have taken place 2 years before the application of loan. In the case of chapter 13, the duration is 1 year.

• VA Loans

If you are looking for this loan for your mortgage, you need to wait 2 years in case of chapter 7 or Chapter 11 bankruptcy, while there is no waiting period in case of Chapter 13 bankruptcy.

• Conventional Loans

These types of loans offer an advantage over FHA loans, the mortgage insurance is removed after 20% equity in your home is reached. However, it is not easy to procure a conventional loan post-bankruptcy. in the case of chapter 7 or chapter 11 bankruptcy, the dismissal should have taken place at least 4 years back.

In the case of chapter 13, the waiting period depends on discharge or dismissal of the case:

• If it was discharged, you need to wait 4 years from the filing date and 2 years from the discharge date to apply for this loan.
• If the bankruptcy was dismissed, you can apply for conventional loan 4 years after dismissal.

Being careful and working towards your goal will get you the desired results. Having the assistance of bankruptcy lawyers can be an asset in this case. In case you haven’t hired one, you can call at 888-297-6023 to discuss your case with experienced bankruptcy attorneys.

Call: 888-297-6203

Bankruptcy is something that people wish to avoid at all costs. However, sometimes it becomes essential to file for bankruptcy if you wish to get rid of your debts. Before filing for bankruptcy, Los Angeles based bankruptcy law firm Recovery Law Group lawyers suggest that you should find out how personal bankruptcy chapters might affect your mortgage payments and future home financing requirements.

Personal bankruptcy filers have a choice between Chapter 7 and Chapter 13. The former is liquidation bankruptcy which gets rid of all unsecured debts, but you might have to sell your non-exempt property to pay off the creditors. it is also known as total bankruptcy (wipes out most debts) or straight-up bankruptcy (forgives your debts). The latter provides you with a chance to pay your creditors through a court-approved repayment plan. While some debts need to be paid in full, others are paid partially, and some can be discharged without paying anything.

Effect of Chapter 7 bankruptcy on mortgage

In chapter 7 bankruptcy, your property can be either exempted or non-exempted; in case of former, you can keep it free and clear. if it is the latter case, you might have to either surrender it or if you wish to keep it, then pay for the non-exempt part. However, you need to consult bankruptcy trustee for it. while providing you with a loan for purchasing your house, the mortgage companies have a lien on the property till the loan is paid. Filing for bankruptcy might get rid of the loan but not the lien the mortgage company has on your property. Thus, if you wish to keep your property free and clear, it is advised to pay your mortgage.

Once you have your chapter 7 discharge, you need to wait at least 2 years before you can be considered for finance. In case you find lenders willing to give you mortgage loan before this timeframe, be sure that the terms and conditions are in your interest.

Effect of Chapter 13 bankruptcy on mortgage

With automatic stay in place after the bankruptcy filing, you are assured of no foreclosure or repossession of property. You can repay your mortgage and even catch up on past lost payments through the repayment plan. Once you are through with your repayment plan (3-5 years), you must wait another year (exceptions for US veterans) before you can opt for a mortgage loan. If you get an offer before the said duration, be aware of the interest rate and conditions of the mortgage.

A bankruptcy filing is a decision that must be taken after considerable thinking. Consultation with qualified lawyers is advised before taking the plunge. You can call 888-297-6023 to schedule an appointment with bankruptcy attorneys.