Will bankruptcy negatively impact my credit?
A bankruptcy filing will show on a credit report as a public record for a period of time from 7 to 10 years. However, it is a common misunderstanding that bankruptcy filings will have a negative impact on your credit worthiness for that period.
A bankruptcy filing will not effect your credit worthiness as much as other items that might be on your credit report. Foreclosures, repossessions and charged-off debts have a much greater negative impact on credit worthiness than a bankruptcy filing.
As a general rule, you can anticipate that your credit score will increase by 100 points after you receive a discharge of your debts in the bankruptcy.This is of course assuming that you keep all of your debts paid in a timely manner after the filing of a bankruptcy.
Bankruptcy filings for the most part improve the credit worthiness of the filer, because the debtor is able to discharge all or a significant portion of their unsecured liability to creditors.
How does Chapter 13 Bankruptcy work?
Chapter 13 bankruptcy is a court approved and supervised reorganization of consumer debt. In a Chapter 13 bankruptcy a budget is assembled that reflects all sources of income and all monthly living expenses.
The difference between the income and expenses is known as disposable income, which is the amount that is paid to the Chapter 13 Trustee on a monthly basis to pay those creditors who are provided for in your plan of reorganization.
Chapter 13 plans of reorganization are no shorter than 36 months, and no longer than 60 months. Chapter 13 plans or reorganization can be fairly complicated and require the expertise of an experienced bankruptcy practitioner.
How does Chapter 7 Bankruptcy work?
Chapter 7 bankruptcy is often called liquidation bankruptcy, but such a term does not adequately take into consideration that in the overwhelming majority of Chapter 7 cases there are no assets to liquidate.
Chapter 7 bankruptcy is primarily used for persons who income qualify and who desire to discharge their liability for unsecured debts (e.g. credit cards, payday loans, signature loans and medical bills).
The exemption law of the State of Texas or the US Bankruptcy Code allows you to protect the property you own from liquidation.
What Do I do if I am facing a foreclosure on my home?
If you are facing a foreclosure on your home and you don’t want to lose your home, then it is most likely going to be necessary for you to file a Chapter 13 bankruptcy.
There is no way to stop an active foreclosure other than through a bankruptcy filing or a written agreement from the mortgage company.
A Chapter 13 bankruptcy provides a means to take the amount that you are behind on a mortgage and spread that amount over the length of your plan of reorganization.
What will I need to provide you with if I decide to file a bankruptcy?
Every bankruptcy case is different and might require some additional documentation, but for the most part I will need to obtain the following from you:
1) pay stubs for any employer for the six months prior to the month of filing of the
2) income tax returns or income tax transcripts for the two years prior to the
3) proof of any other source of income other than employment (e.g.pension income, social security, child support, etc.); and
4) copies of most recent statements or collection letter from any creditor.
The remaining documents to be gathered will depend on your individual circumstances, which we can discuss when you give me a call at 800-867-1583.
“We are a Debt Relief Agency. Our debt relief lawyers help people file for bankruptcy under the United States Bankruptcy Code.”