August 12, 2019
What is Chapter 7 Bankruptcy and How Did I End Up Drowning in Debt?
You may be asking yourself, what is Chapter 7 bankruptcy and how did I end up with so much debt? It’s very easy to overspend thanks to multiple credit card companies and convenient loans that lure Americans into debt. The consumerist culture is the bane of modern life with advertisers and manufacturers luring you into buying items or using services that you should shun when you can’t afford them.
When you pile on credit card and other debt, you really don’t even know what you are letting yourself in for – it’s one of the worst forms of debt. One simple credit card debt, can lead to you paying exorbitant rates of interests (varying among card issuing companies). When you don’t clear your payments, then you will pay interest on interest, making it a vicious and never ending cycle.
When you keep getting bills, emails, or phone calls from creditors asking you to settle your debts, you should check your bankruptcy options instead of just drowning in your debt. Chapter 7 and Chapter 13 are two types of bankruptcies available to you when you are having financial troubles.
What is Chapter 7 Bankruptcy?
In a Chapter 7 bankruptcy, almost all people who file a Chapter 11 bankruptcy get to keep all of their belongs, car, house, etc. There are certain laws that regulate what a person in bankruptcy can keep. You should meet with a Bankruptcy Attorney to discuss these laws and how you can be protected. Usually, all unsecured debt will be wiped out when your bankruptcy is final.
What Does A Chapter 7 Bankruptcy Do?
A Chapter 7 Bankruptcy discharges your unsecured debts. Discharge means that the debts are “wiped-out”. You no longer owe those debts. The lenders can never send you a bill, call you or sue you, no matter what happens in the future or how much money you make or accumulate. A Chapter 7 Bankruptcy immediately stops lawsuits, collections, garnishments, harassing phone calls and angry collection letters.
What is the Downside of Chapter 7 Bankruptcy?
Now that you have some idea of what Chapter 7 bankruptcy is, you may wonder if there are any disadvantages of filing for this bankruptcy. Any kind of bankruptcy proceedings will adversely impact your credit ratings. Although, often a person seeking bankruptcy protection and a Fresh Start already have seen their credit negatively impacted by getting behind on bills or too much debt. For several years you may have to pay more interest on loans.
What is Chapter 7 Bankruptcy and How Long Will it Affect My Credit?
If you can show that you have solvency, are able to make sound financial decisions and spend your money wisely, and pay up your debts regularly, your bankruptcy will have less and less impact on you. Owning your home, having a job and a car after you file for bankruptcy are signs that you should be able to restore your healthy credit. , If you are making good financial decisions, these will show on your report also and is taken into account by lenders.
What is Chapter 7 Bankruptcy and is it an Option for Me?
The only way you can be sure that bankruptcy is an option for you is to speak to a bankruptcy attorney about your situation. Steven M. Fishman is an experienced attorney who has been practicing in Pinellas County for over 27 years. He has been helping families and business with bankruptcy matters for over two decades and offers a free no-obligation consultation to advise you of what your best options are. Call 727-724-9044 today to schedule yours and find out if bankruptcy is an option for you.