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  • Motions to Dismiss Denied in FDCPA/FCRA Case

    Motions to Dismiss Denied in FDCPA/FCRA Case

    Recently, the Eastern Division of the U.S. District Court Northern District of Illinois passed a judgment by denying all the attempts made by the defendant to dismiss the counts against them. In this FDCPA/FCRA case, the accused –Bayview Loan Servicing, LLC has failed to correct the error in lieu of the plaintiff’s mortgage obligation after filing for a bankruptcy discharge.

    Facts of the Above case:

    1. Before the merger between Countrywide Home Loans and Bank of America in September 2012, the plaintiff had carried out 2 mortgage loans with Countrywide Home Loans. After the merger, his loans were under Bank of America. In December, he was informed that his previous loan of mortgage were now taken over by Bayview loan Servicing and he owes the sum amount to them.
    2. After learning about the new acquision, the plaintiff applied for bankruptcy under chapter 13 in December 2012. As per the Bankruptcy plan, he agreed to surrender his home. An Order of Discharge for the same was received by him in May 2014.
    3. After the Order of Discharge was issued, Credco (Defendant No 2) without the plaintiff’s consent, requested and received all the copied of the plaintiffs Experian Credit Report.
    4. In the mean while, the plaintiff was constantly receiving Post-discharge communications from Bayview. As per the communications, he had failed to pay his mortgage payments and hence faced foreclosure of his home as per the bankruptcy plan.
    5. As per the plaintiff’s claim, Experian and Equifax’s Credit report contained errors as per his mortgage with Bayview. He alleges, that despite informing both the reporting agencies of the error, Equifax did nothing to correct the error. On the other hand, Experian did attempt to correct the error, but failed to eliminate few information.
    6. The plaintiff also alleged that Bayview had violated the Fair Credit Reporting Act (FCRA), the Fair Debt Collection Practices Act (FDCPA) and the Illinois Consumer Fraud Act (ICFA). Credco (Defendant No 2) has also been accused for violating the FCRA.

    In this case, the Court accepted the plaintiff’s plea and passed the judgment in his favor. As per the court, FDCPA’s norms were violated by Bayview and hence, all motions to dismiss were denied.

    If you are one such victim and believe that yours rights have been violated under FDCPA or FCRA, do not hesitate to contact the best Recovery law Group Firm to come to your aid. With experienced litigators, your case with be handled with utmost ease and professionalism. To get in touch you can reach out to them on their website or simply call them (888-297-6203) and fix an appointment to get immediate redressal.


      *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.

    • The Decline in Chapter 11 Filings

      The Decline in Chapter 11 Filings

      There is certainly a vivid decline in the rate of filed bankruptcies for business across the entire United States. Bankruptcies are commonly filed by only small businesses that have annual revenue of 2.5 million or less. These small business organizations generally approach the courts for their tougher conditions towards the business operations. Only a few states such as Illinois witnessed Chapter 11 filings demonstrating a gain in 2014. The increase was close to 6 percent at the end of the first quarter of 2014. This increase has been majorly contributed by large casinos in Illinois such as Harrahs, Showboat, Caesars, and Horseshoe. These casinos have filed for Chapter 11 bankruptcies in the Northern District of Illinois.

      This situation has been assessed by economists and they cite a few reasons for this declining trend. The lower interest rates associated with business loans have urged the businessmen to borrow more but these businesses that underwent financial struggles have already closed in the year 2007 when the recession was seen. Another reason is that the filing of bankruptcy is generally a costly affair and hence businesses start looking for other alternatives to solve their debt issues.

      There is a forecast for the increase of Chapter 11 filings in the coming days as there has been a rise in the interest rates of business loans and some of the already issued ones, like the ones of 2009 are very soon due. So if there is a business that is yielding good revenue yet experiencing financial difficulties and battles paying their dues, then filing for business bankruptcy is a viable choice. By working towards the restructuring of debts, the business can get the financial relief that is needed and can be brought on its track with better control.

      If you are running a business that doesn’t generate revenue in order to pay your business dues, then it is better advised to reach a law firm like the Recovery Law Group. Their team of bankruptcy attorneys will explain clearly all the process and the outcome of Chapter 11 bankruptcy filing. Recovery Law Group operates in Los Angeles, California and in Dallas, TX. Remember that working with the experts in this field and with an efficient plan of reorganizing the debts in your business, you can gain better control of your business. Call them at 888-297-6203 to avail their services and reshape the financial structure of your business with them!


        *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 a Litigant Who has filed for Bankruptcy be harassed by Financial Servicing Company?

        Can a Litigant Who has filed for Bankruptcy be harassed by Financial Servicing Company?

        A plaintiff who had executed a mortgage loan from Bank of America, N.A. on April 16, 2007, was unable to make adequate payments to the bank. This resulted in the bank filing a foreclosure complaint against the plaintiff. Post this, the plaintiff filed for bankruptcy under Chapter 13 in January 2013, which resulted in automatic stay affording protection against any collection actions. In June 2013, a modification was made in Chapter 13 bankruptcy by the plaintiff, wherein they proposed to surrender the home to Bank of America, N.A. against their claims. This modified plan was confirmed in June 2013, by the bankruptcy court.

        This debt was later sold off by Bank of America, N.A. to BSI Financial Services, Inc. To recover the dues, BSI Financial Services, Inc. sent a Notice of Servicing Transfer to the plaintiff on October 1, 2014. According to the notice, the plaintiff is expected to send any payments due on or after the said date to BSI Financial Services, Inc. A disclaimer was also attached to it, according to which:

        In case you have filed for bankruptcy, the “automatic stay” comes into effect in a bankruptcy case, or you have received a discharge for personal liabilities for obligations specified in the letter, BSI Financial Services, Inc. will not and does not intend to pursue collection of said obligation from the plaintiff personally.

        After six months of sending the above-mentioned notice, BSI Financial Services, Inc. made over ten phone calls to the plaintiff’s cell phone, nearly five calls to the home telephone and more than 10 voicemails. The plaintiff responded to BSI Financial Services, Inc. and asked them to stop the constant harassment since they had already filed for bankruptcy. But despite the request, the calls continued. According to the plaintiff’s complaint against BSI Financial Services, Inc. they had:

        • Made a minimum of 10 calls within a 2 month period (between October 15, 2014, and December 12, 2014)
        • Used automatic dialer system to call the plaintiff
        • Continuous calls were made to plaintiff’s cell phone
        • Made regular attempt to contact the plaintiff without their consent.

        BSI Financial Services, Inc. asked the court to dismiss all four different claims made by the plaintiff. Since numerous complaints were made by the plaintiff, the court also gave multiple decisions:

        1. Since BSI Financial Services, Inc. had acted as a debt collector, thereby violating the Fair Debt Collection Practices Act, the 1st charge of the complaint was not dismissed by the court.
        2. Since there was no proof that the voicemails left by BSI Financial Services, Inc. were pre-recorded, that plaintiff answered calls or that there was a delay before plaintiff got any human response, the 2nd charge was dismissed.
        3. The 3rd count was not dismissed as the defendant, BSI Financial Services, Inc., had indulged in acts of collection, assessing and claims of recovery by sending the plaintiff letters and numerous phone calls all amounting to the collection. Due to these actions, the defendant had willfully violated the bankruptcy automatic stay.
        4. A further analysis was required to assess whether the defendant had violated the Illinois Consumer Fraud Deceptive Business Practices Act for the 4th

        In case you find yourself in a bad financial situation, it is important that you contact expert bankruptcy attorneys at 888-297-6023 to find out the best possible course of action for yourself. To frame an effective plan for your financial problems, consult Los Angeles based law firm Recovery Law Group .


          *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.

        • Will Filing Bankruptcy Require Liquidating of Business?

          Will Filing Bankruptcy Require Liquidating of Business?

          It isn’t uncommon for a business owner encountering situations wherein revenues decline and debts become surplus. Planning and executing business is by itself a challenge and being in junctures of financial instability can be equally worrying. Luckily, the U.S. Bankruptcy Code is a saving grace to address these startling situations of the financial crisis in businesses and in personal front too!
          The key question of a business person is whether the business needs to be liquidated in bankruptcy. To throw some clarity to this, here are some important factors that are to be understood while the business owner files for a bankruptcy

          The type of bankruptcy filed for your business will be the deciding factor and it determines whether your business/ company needs to be liquidated. Filing for bankruptcy under Chapter 7 clauses of your business requires your company and the other assets to be sold in order to settle your creditors. In cases of companies/ businesses that haven’t been incorporated or under sole proprietorship, the type of bankruptcy to be filed will be a personal Chapter 7 bankruptcy. So discuss it with the right business attorney whether Chapter 7 bankruptcy for business or for an individual is needed for your case.

          Filing for Chapter 11 bankruptcy for the financial issues in your business enables the restructuring of those debts so that they can be repaid over time. This scenario is somewhat similar to the bankruptcy filing done by individuals and couples using Chapter 13. Chapter 11 bankruptcy is suited for larger businesses and saves the company and its assets from being sold – the bankruptcy plan should have been presented earlier and approved by the bankruptcy court.

          Another view to Chapter 11 bankruptcy for businesses enable the company to liquidate their assets in an orderly or organized way. This is best suited for businesses when they are determined to close operations or if their operating costs are higher than before. This planning created buyer friendly conditions and yield better liquidation outcome.

          If the business owners run a business of good value and that assure recovery over the years, then they can repay their debts via an approved bankruptcy plan – this plan should have been in place and approved by creditors & bankruptcy court. They can continue operating their business and save it from liquidation. The bankruptcy trustee determines the value of your company and whether there are assets in your company that can be liquidated in order to benefit creditors

          Despite the stated factors above, every business case could be quite unique in its nature. As renowned bankruptcy attorneys, the Recovery Law Group works with every client who has fallen into tough times financially in personal and business fronts. The clientele base that we cater to is from the Los Angeles and Dallas, TX regions.


            *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.

          • Should I Keep My Car during Bankruptcy?

            Should I Keep My Car during Bankruptcy?

            Bankruptcy is a name which often causes people to panic. This is so because most of the time, it is associated with the image of being thrown on the streets penniless. However, nothing could be farther than truth. More often than not, the financial situation of an individual is tight, which has led them to file for bankruptcy. Since financial problems can affect a number of areas of your life including your job, property, and vehicle, many people question whether it is appropriate to keep their vehicle if they plan to file for bankruptcy. (more…)

          • Can Bankruptcy Help Eliminate Medical Bills?

            Can Bankruptcy Help Eliminate Medical Bills?

            Financial problems can arise due to many factors, one of which is huge medical bills. If non-payment of medical dues can cause economic issues for you, you might have to file for bankruptcy to save yourself from insurmountable debts. However, many times, clients feel guilty about filing for bankruptcy, probably due to the fact that they somehow were incapable of arranging for such an emergency which may lead to the feeling of incompetence. It is important to remember while taking a guilt trip; that this is something nobody asked for and therefore bankruptcy is not something one should be guilty of doing in such a situation.

            More often than not, medical debts are often unforeseen and probably impossible to avoid and manage. Los Angeles based law firm Recovery Law Group advises that bankruptcy is a legal provision available to deal with such situations. More often than not, out of the various debts incurred, the medical debts is almost always impossible to cover. The reason for this might be that more often than not, medical dues are followed by loss of a job or reduced salary, which makes it nearly impossible to cover your financial dues. Since a majority of the times, credit cards are used to pay for medical bills, the exact amount you have indebted yourself remains unclear until the water is above the head.

            Unfortunately, this debt is one of the worst as medical bill collectors are some of the worst and most aggressive ones in the industry and may harass you continuously till you clear the dues. This can aggravate your already fragile condition. It is therefore advised that you consult adept bankruptcy lawyers to get help for any medical dues you have incurred, at the earliest.


              *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.

            • Bankruptcy’s Impact on Credit Worthiness

              Bankruptcy’s Impact on Credit Worthiness

              Credit scores reflect on the financial history of an individual or a business and are meticulously built over time. When there are moments of financial crisis and debts pile up, the individuals ultimately opt to file for bankruptcy. The biggest fear when the individual’s file for bankruptcy is how it impacts their credit scores. There are many reasons why credit scores will not be impacted in cases of bankruptcy as every individual commences their financial status afresh and they have time to rebuild their credit history

              Checking with a bankruptcy attorney or a law firm such as Recovery Law Group, who serve the Los Angeles and Dallas regions, is a recommended option for individuals who seek guidance on building their credit history. They have the experience to share the best practices and impart the guidance in order to avoid any further mishaps in the financial arena of the individuals. The below points will also be a guideline to understand how your credit worthiness stands when you have filed for bankruptcy.

              • If an individual has filed for Chapter 7 bankruptcy, the filing will remain on their credit report for up to 10 years of tenure. If good efforts are expended on rebuilding the credit over time, then the filing & the discharged debts have very less impact. It is assessed that most of the discharged debts drop off a credit report in approximately 7 years.
              • If the bankruptcy filing is of Chapter 13 type, then it is displayed on the consumer’s credit report for seven years. It is the similar condition for discharged debts too even though they may be repaid within three to five years through a formalized repayment plan – discharged debts appear on the credit report even beyond the repayment tenure.

              Credit worthiness will eventually improve as the time goes by – the impact of repayment and your rebuilding of credit worthiness will enable you to get offers from the creditors at large. So besides the amount of time that the bankruptcy filing remains on the credit report, the impact of the filing may reflect in high-interest rates (direct/ hidden) of new credit offers or may put individuals to deal with subprime lenders. Some of the mortgage lenders will view bankruptcy filing differently – say the eligibility of an individual to obtain an FHA mortgage can be one year if filed for Chapter 13 bankruptcy and will be two years if Chapter 7 filing is done. Few factors such as income, current debts, and down payment amount work beyond the bankruptcy filing and may affect the wait periods.

              It is understood that individuals leverage bankruptcy filing to regain their financial stability. Though the impact to credit worthiness is there when you have filed for bankruptcy, it isn’t permanent!


                *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.

              • A Joint Chapter 7 Bankruptcy Filing

                A Joint Chapter 7 Bankruptcy Filing

                Joint Bankruptcy or Joint Chapter 7 Bankruptcy is the filing opted by married couples who face surplus debts and seek options to have them discharged as they have challenges of paying them. Let’s first understand how the filing of Joint Bankruptcy works –

                • A single set of bankruptcy papers are filed on behalf of the married couple (though there are two individuals involved)
                • All property information, debts, income to the family and expenses are submitted to the court
                • Debts can be those that are jointly owned or can be the ones that an individual owes to other
                • Details of the debts that are expected to be discharged have to be provided in the petition – debts that can be allowed to be discharged as per Chapter 7 are considered in the joint petition
                • For discharging of debts, the assets are usually cannibalized – it is normally not possible to protect every asset. Hence it is important to understand the risks involved in jointly filing for bankruptcy especially when you own properties with your spouse
                • If the joint petitioners are from the Texas region, they can review the Federal and State Bankruptcy exemptions in order to protect their properties against liquidation in cases of filing a bankruptcy. One motor vehicle per licensed family member, 100-200 acres of property in the country or 10 acres in a city are some of the state level exemptions in Texas. Reviewing these with the bank attorney prior to filing the joint petition is a wise move

                Now that we know how the filing process works, let’s also assess the advantages to opting for a joint bankruptcy filing.

                • As filing for bankruptcy is an expensive ordeal, do it jointly is definitely going to cost you less. It will save couples from paying double the filing fees and paying your attorney twice the amount
                • Most of the dischargeable debts are appropriately taken care of and eliminated in the joint bankruptcy filing
                • The efficiency of completing the bankruptcy case is better when filed jointly – you save time by handling all of the tasks at a single phase/ time

                However, there are some disadvantages to this process –

                • All of the assets that are individually owned or jointly owned are disclosed during the filing procedure. This can also end up in liquidating valuable or viable properties by the trustee handling your case – at times the partner who owns more properties end up losing more of it
                • The couple ends up in owing too much of priority debt. As per the clauses of Chapter 7, there are certain kinds of debts that cannot be discharged – taxes, mortgages and child support are some of this kind. In cases of these, the repayment in full of these debts also needs to be done jointly as per Chapter 13. In such situations, the partner who owes the debt can file the bankruptcy individually

                Are you perplexed of whether to opt for a joint fling or not? A renowned law firm and the experienced attorneys will help determine your case and advise the course of action as needed. Seeking the assistance of such firms like the Recovery Law Group can put you in better positions of handling your bankruptcy scenario and also retain some of your prized assets by saving them from liquidation.


                  *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.

                • Why Hold Back from Bankruptcy Filing?

                  Why Hold Back from Bankruptcy Filing?

                  Many times, people who owe creditors money, lead a life that is full of threats and harassment. Debt collection agencies do not leave any stone unturned to get back the money that you owe them or the creditors. In case you too are plagued with incessant phone calls, urgent notices or demands for financial settlements, why are you hesitating to file for bankruptcy? More often than not people are afraid of filing for bankruptcy due to the various myths surrounding it. Lawyers of Sacramento based law firm Recovery Law Group provide a number of common reasons why people restrain themselves from filing for bankruptcy:

                  • Bankruptcy Hurts You Financially: Credit card companies allow you to make purchases now and pay the money later while charging heavy interest on the amount of transaction. Since you are paying for a long period of time, the loans never get paid off while you keep on increasing your debt by continuous usage of credit cards. In the long run, this causes you to have poor credit, which can be eliminated by filing for bankruptcy. With the bankruptcy filing, you can get your old debts discharged (completely or partly) and start fresh. In this manner, you can rebuild your credit score in a couple of years compared to struggling with bills for a long time.

                  • Your Credit Gets Ruined for a Decade: It won’t be incorrect to say that getting loan or credit card becomes slightly difficult after bankruptcy, but getting one with poor credit score is highly unlikely too. It is important to note that filing for bankruptcy provides you with a chance of getting a fresh slate to start anew. When you make regular and timely payments on your mortgages, utilities, rents and any other debts, your credit ratings will improve. This will ultimately get you approval for secure credit cards and loans within a couple of years of filing for personal bankruptcy

                  • Lose Your Home by Filing for Bankruptcy: Though there are chances in case of personal bankruptcy (Chapter 7) where personal assets including property are sold off to clear the creditors’ dues, however, the possibility of this happening is slim. This is because of strong federal exemptions. Moreover, if you are eligible and file for bankruptcy under Chapter 13, you won’t be losing your home at all.


                    *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 Happens to Credit Card Debt in Bankruptcy?

                    What Happens to Credit Card Debt in Bankruptcy?

                    Spending beyond the budget is a common occurrence, thanks to the ever-prevailing credit cards. Since you do not have to pay immediately, people often go overboard with their spending, not realizing that eventually the money is to be paid and that too with additional charges. It is no wonder that a large number of population incurs heavy debt thanks to this habit, resulting in many of the individuals filing for bankruptcy. The excessive debt may also be due to exhaustive medical bills or vehicle repairs etc. Many times, credit card debts are discharged (with some exceptions) when a person is able to successfully complete a Chapter 13 or Chapter 7 bankruptcy.

                    According to Sacramento based law firm Recovery Law Group individuals can file for bankruptcy under Chapter 7 or Chapter 13. The procedure of getting credit card debt discharged is different in each case. Let’s take a look at what happens to credit card debt in both cases:

                    Chapter 7 Bankruptcy

                    Filing for bankruptcy under chapter 7 will get most of your debt discharged but you will be required to give up all your non-exempt property. The property is sold by the bankruptcy trustee and the money received is used to pay off the creditors. Unlike child support and taxes, which are priority debts, most credit card debts are regarded as non-priority and unsecured debts. Unlike priority debts which cannot be discharged, credit card debts are discharged with chapter 7. It is possible for an individual to file for bankruptcy under chapter 7 and endorse all debts except credit card debt. In this case, the bankruptcy filer is liable for the endorsed debts after the bankruptcy is finished.

                    Chapter 13 Bankruptcy

                    If your situation permits, bankruptcy under chapter 13 might suit you well. During this type of bankruptcy, you are required to make partial or full payments to some creditors. A specialized repayment plan is drafted, wherein you are required to make payments within 3-5 years period. In the majority of the cases, a portion of the unsecured debt (such as credit card) is paid in this type of bankruptcy. The repayment amount depends on a number of factors including your disposable income, repayment amount, unsecured debts, etc. Most of the individuals filing for bankruptcy under this chapter only need to pay for a small percentage of their unsecured debts. After the repayment period is over, the remaining credit card dues are discharged.

                    Can Creditors Challenge Your Credit Card Debt Discharge?

                    Despite the court ordering for the discharge of your credit card debts, sometimes, the creditors may challenge it. If the credit card debt is incurred by a person due to fraudulent activities, then the debt cannot be discharged. If an individual is involved in any of such activities:

                    • Providing false information/statement on credit card application.
                    • Making heavy purchases of over $650 in luxury services or goods within 90 days before filing for bankruptcy, gives an impression of fraudulent activity (prior intention of filing for bankruptcy)
                    • Taking a cash advance totaling more than $925 within 70 days of filing for bankruptcy.

                    If any of the above is found true, the creditor can challenge the debt discharge process. In case they win the appeal, the court can make it mandatory for the individual to pay the credit card debt. Sometimes, however, some creditors take a security interest in the property. In such circumstances, the credit card debt becomes a secured debt, which means, the debtor has to pay it off.

                    It is important to remember that once you file for bankruptcy, creditors cannot take you to court and also not make attempts for debt collection. The automatic stay prevents credit card companies and debt collection agencies from contacting you through any means such as telephone, letters.


                      *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.