Before You File Bankruptcy
get the facts.

The decision to file bankruptcy is an important one. While bankruptcy offers you a fresh financial start, you must consider all of your options. Call for your free consultation. I'll sit down with you and you can get it all on the table. I'll explain the options to you. If bankruptcy is not right for you, I'll tell you. You need to make a well-informed decision.

 

Chapter 7

Chapter 7 is referred to as Liquidation and it contemplates court-supervised procedure by which a Trustee collects a debtor's assets, reduces them to cash and pays creditors, subject to the debtor's right to use exemptions to protect assets. There is usually little or no nonexempt property in most Chapter 7 cases, so there may not be an actual liquidation of the debtor's assets. These cases are called "no-asset" cases. The debtor normally receives a discharge just a few months after the petition is filed.

Chapter 13

In Chapter 13, debtors keep assets by proposing a plan to repay creditors over a three to five year period. The amount repaid depends upon the income and assets of the debtor. In most cases, creditors are only paid a fraction of the debt owed - they are not paid in full. Once all payments are made under the plan, a discharge is entered.

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How to Repair Your Credit

1. Open a checking or savings account and start saving money. This shows lenders that you are responsible.

 

2. Apply for store and gas credit cards. These cards generally have lower limits to get you started.

 

3. Get a secured card where you deposit cash and charge against it. Get a secured card with creditors that report to the major credit reporting agencies.

 

4. After you file, pay what bills you do have - rent, utilities, a car payment - on time. Paying timely is crucial.

 

5. Find a friend or relative to cosign for you on a loan and pay it on time. It takes longer to rebuild credit if you do not have an installment payment.

 

6. Look for car dealers and mortgage brokers that claim to be "bankruptcy friendly".

 

7. Stay away from payday loans and finance companies that are at high interest rates.

 

8. Live within your means. If you don't have the money....don't spend it.