These days more people than ever before are considering filing for bankruptcy, but of course consumer bankruptcy is not a one-size-fits-all solution. Many individuals may not be able to do a personal bankruptcy filing because of a high level of income relative to their household size, nonexempt assets or their legal immigration status or future financial considerations. Since credit counseling offered by authorized agencies is currently required for all bankruptcy filers, taking this course even without later doing bankruptcy might be a good option for those wanting more information about alternatives to bankruptcy. Many of the same agencies offering the course provide credit consolidation services. However, be aware that private credit consolidation companies are in the business of making money by arranging repayment of debts.
Often, clients come to me after having unsuccessfully tried credit consolidation and having automatic deductions of monthly payment amounts withdrawn from their bank accounts. In addition, Chapter 13 bankruptcies offer the advantages of private credit consolidation with the legal protections of bankruptcy by arranging for repayment on the debtor’s terms. I usually recommend people considering bankruptcy to start trying to negotiate total balances owed and payment plans directly with the creditors, most of whom are happy to get some portion of what is owed. Be sure to check first whether you qualify for bankruptcy in your jurisdiction, as the median household income amounts and exemptions allowed for property would vary from state to state.
September 28th, 2009 by Administrator
If you have been through a contested divorce, your attorney may recommend you file for bankruptcy in order to move on financially after the loss of your spouse’s income and responsibility for joint marital debts. In such cases, the judgment of divorce should take precedence over the individual’s credit report in determining what debts are owed. Particularly if you are the parent having physical custody of the children, and especially if the amounts of any child support payments you may be receiving from the other parent are limited or nonexistent, having recently been divorced may be a good reason to reestablish yourself financially through a Chapter 7 discharge of debts.
September 24th, 2009 by Administrator
The answer is, it depends. Utility bills are an example of an unsecured debt, but the priority of their payment would depend upon the debtor’s desires as regards their property. Debtors whose property is going to foreclosure may also write off their unpaid utility bills along with the mortgage and maintenance expenses. Such individuals cannot then be denied service by the utility because of their default as the utilities are regulated by law and prevented from doing so. However, debtors who wish to stay in their house should be aware that these accounts would have to be brought up to date as soon as possible to avoid action against them.
September 14th, 2009 by Administrator
Debtors appearing for a creditors’ meeting whose native language is not English will no longer be able to use a family member, friend or even professional interpreter for translation. Rather, the District of Massachusetts bankruptcy court will provide its own translation service to interpret. Notification of the need for an interpreter and arrangements should be made with the trustee’s office after filing and as soon as possible prior to the meeting.
September 14th, 2009 by Administrator
