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Many people who file bankruptcy don’t understand what a positive impact it will have on their lives. Bankruptcy is
a powerful federal law designed to protect you from abusive and
predatory debt collectors. Bankruptcy can protect assets, give
you leverage with creditors, and provide peace of mind immediately.
Bankruptcy offers
you ways to actually solve bill problems by immediately stopping
creditor phone calls, collection letters, wage garnishments,
lawsuits, bank levies, repossessions, foreclosures and all other
types of harassment, intimidation and scare tactics by creditors.
Once the harassment is stopped, debts may be “discharged” or legally excused, under Federal Law.
There
are a few types of bankruptcy to consider:
- Chapter 7
Bankruptcy
- Chapter 11
Bankruptcy
- Chapter 12
Bankruptcy
- Chapter 13
Bankruptcy
The most common
types of bankruptcy for consumers are Chapter 7 and Chapter 13.
Chapter 7 is often the best choice for because it can eliminate
debts completely and permanently. You get relief right away,
and the opportunity to start fresh immediately. There is no repayment
plan in Chapter 7.
The other common
way to file is Chapter 13, or debt consolidation. Chapter 13
is not a loan, but a federal law which requires your creditors
to accept only what you can afford to pay them as payment in
full. In many cases that means just a few pennies on the dollar.
In Chapter 13 all your necessary expenses are paid first including
rent (or mortgage), food, car, insurance, gas, utilities, child
care, clothing, etc. Once those necessary monthly expenses are
paid, only what’s left over goes into your consolidation plan. Nothing you can’t afford.
You may think that
after you file bankruptcy, you’ll never be able to finance a car or buy a house again. Well, that’s simply not true. You may not realize, one of the most important items on a
credit report is your debt-to-income ratio, and as you can imagine,
once your debt is wiped out, that ratio improves dramatically.
Without the burden of debt you’ll also be more able to save for a down payment which further enhances your standing
with lenders.
There are even home
mortgage program available for consumers right after bankruptcy.
If
you need help with filing bankruptcy, please contact a Lawyer who is can help with filing bankruptcy and start rebuilding your credit for the future.
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