Stop Drowning in Debt

The Congress of the United States established the bankruptcy system specifically so that a person who is financially in debt can get a fresh financial start. Good people, with good intentions often suffer life circumstances that cause them to be in debt with payments much greater than they can reasonably pay. The filing of bankruptcy directly stops all of your creditors from attempting to collect debts from you outside the bankruptcy process.

Experienced Bankruptcy Attorney Dan Scott reports that bankruptcy filings continue to rise. As the economy continues in its downward spiral, good people are often left with very few options but bankruptcy. In fact over 1,446,000 bankruptcy cases were filed in 2009. It seems that there are many myths about Bankruptcy. I want to dispel 3 Myths about Bankruptcy in this article.

There are 3 Myths about Bankruptcy That Must be Dispelled

Myth No. 1: Filing Bankruptcy Can be Pricey. For less than you will spend on your credit card payments and other monthly payments, you can probably pay a bankruptcy lawyer and court costs. What’s it worth to you to no longer owe your debt? I’d say significantly more that the cost you’ll incur. Creditors tell you, “Just pay the money to me.” Don’t be deceived when they say that.

Myth 2: You may lose your property in a bankruptcy: If you weren’t paying all the other debts could you pay your house note and your car payment? For most folks the answer is YES. Because the answer is yes (if it is) under most circumstances you will not lose your property when you file a bankruptcy case. The Exemption Statutes passed by Congress allow you to keep a specific amount of property if you file your case. Because of the values of your property, in most instances you won’t lose your property in a bankruptcy case.

Myth 3: Not all your debt can be discharged. I hate it when this statement is made because it has “some” truth in it, but not much. Almost every unsecured loan, medical bill, credit card and pay day lender will be wiped out when you file a bankruptcy case. If you file a Chapter 13 case (For the difference between a Chapter 7 and a Chapter 13 check out the video at http://www.danwillhelp.com) you’ll pay payments over time that often clears all of your debt except your home mortgage. Certain specific debts will survive the bankruptcy, such as certain taxes, back child support, student loans, DUI fines or penalties, and claims arising from fraud. However in most circumstances all of your debt will be discharged.

So if you are facing financial trouble and you want to get out of debt though you have tried everything doable to get back on your feet, maybe it is time to consider filing a bankruptcy. You can find more information in the video series published by Bankruptcy Attorney Dan Scott. Go check them out for more information.

If you are struggling with your finances it’s time to get straight talk from an experienced bankruptcy attorney. Check out the video series which is absolutely free. Take back the power away from your creditors today!

How Chapter 13 Bankruptcy Stops Foreclosure

Some states are a non-judicial foreclosure state. This means that your house may be foreclosed on without the lender having to go to court. Generally you will receive notice via mail 20 days or more before the scheduled sale date. The sale is performed by a trustee, not the lender.

Filing a Chapter 13 bankruptcy before the scheduled foreclosure sale will automatically stop the sale. When you file a bankruptcy an automatic stay immediately goes into effect. This automatic stay means that all creditor actions against you and your property must stop, including any foreclosure sale. This means that the automatic stay stops or voids any foreclosure sale of your property.

Before you can file a Chapter 13 bankruptcy there are some things you need to do. Some of the common requirements include filing your taxes for the most recent year due. Proof of your filing of taxes must be given to your attorney. A list of ALL of your creditors is also required in order to give notice to them. Evidence of pay for the previous two months must also be provided to your attorney. You will also need to bring proof of your social security and a government issued photo ID.

Chapter 13 differs from Chapter 7 by having a repayment plan. You propose to pay your creditors, including your mortgage lender, in the Chapter 13 Plan. The Plan will always include paying the regular mortgage note plus an amount that will be enough to pay off the arrears over the life of the Plan – up to 60 months.

After filing for Chapter 13 you will have to pay for any property you wish to keep if that property has a lien on it. The debts are referred to as “secured” debts – examples include mortgages and financed vehicles. A debt that does not have a lien attached to property is referred to as “unsecured” debts. In a Chapter 13 you may be able to pay anywhere from 0 cents on the dollar up to the full amount, depending on things like current income, income over the previous six months, and the total value of your personal and real property.

Automobiles and certain other property, but not homes, are subject to cram downs. A cram down occurs when a secured debt is “cram downed” to the value of the property that secures the debt. For example, if you owe $25,000 on a vehicle that is worth $10,000 then a cram-down would result in the secured debt being only $10,000 and the remaining $15,000 would be unsecured. There are special rules for accomplishing a cram-down.

A Chapter 13 Plan must be confirmed before it can go into effect. Upon confirmation the Chapter 13 Trustee will begin to distribute the funds you have paid into your plan. You make payments to the Chapter 13 Trustee either through a payroll deduction or directly.

At the completion of your Chapter 13 Plan you will be caught up on your mortgage. You will then resume paying your lender directly the regular monthly mortgage. Any unsecured debt that was not paid will be “Discharged” meaning the creditors cannot take any adverse action against you.

If you want to stop foreclosure in Murfreesboro then call Murfreesboro bankruptcy attorney W. Alan Alder at 1-800-706-7863.

What You Need To Know About Finding A Bankruptcy Lawyer

A bankruptcy attorney will be able to direct you through your bankruptcy and might ease some of the strain during this awkward period. A decent attorney will be in a position to make sure that nothing is missed. Although the adjustments to the bankruptcy law are fashioned to do away with the time wasters, no other real changes have been established.

This allows you, under normal situations, to keep your house and car for instance. Work clothes, tools and other necessary items like furniture are also exempt, as a bankruptcy still requires a place to live and a method to travel to work.

Of course, some States have made additions to the federal law and this is where your bankruptcy attorney will be of more assistance if you want to retain the possessions to which you are eligible. The purpose of insolvency is not meant to be a punishment, therefore many items required for living are excused from creditors. This is the reason why not long after you have been through bankruptcy, an entire host of businesses offering credit will begin contacting you, but you must be very cautious at this time.

A good bankruptcy attorney should make his client aware of this. Your lawyer will be able to advise you on trustworthy companies but whatever your credit agreements are, you will do your credit rating a great deal of good if you guarantee that you constantly pay more than the minimum required. That said, your bankruptcy will still be on your record but will likely not be used to prevent the buying of a new home or an unsecured loan.

There is now and likely always will be a stain to bankruptcy. If this attitude continues, it will just guarantee that legislation will become more restrictive. While there are evidently some people that want to take advantage of the bankruptcy protection system, your bankruptcy lawyer will assure you that you are just a victim of ill luck who is being provided a 2nd chance.

Christopher Flema has been writing articles for years. His newest website is about lawn tractor tires. It is called http://www.lawn-tractor-tires.com.