If you are drowning in debt, you are not alone. Millions of Americans across the country are suffering from debt problems due to loss of jobs, medical bills or the loss of a spouse. Life is fluid and we never know what to expect around the next corner.
In my opinion, the single most important tip to rebuild credit after bankruptcy is to not be afraid of credit. One of the biggest mistakes people make is completely avoiding credit after they file bankruptcy. Although avoidance is likely done with good reason, it won’t help rebuild your credit.
Filing a bankruptcy case is an emotional process that most people never want to repeat during their lifetime. However, it is also a process that allows individuals who are suffering from debt problems to receive the help they need to recover from a terrible financial crisis. Taking on credit again after filing a bankruptcy can be scary because credit probably played a role in your decision to file bankruptcy in the first place.
Yes, you can file your own bankruptcy case; however, you probably will not get the results you want as efficiently as is possible. Filing a bankruptcy case can be a very complex matter, especially if it is a Chapter 13 case. In addition to filing the bankruptcy petition, schedules and statements that are required in all bankruptcy cases, you must also create and propose a repayment plan. Repayment plans are complex and require more than simple math to calculate. The benefits of having a Chapter 13 attorney far outweigh the costs you think you might save by trying it alone.
There are several types of bankruptcy available to business owners who are struggling with overwhelming debt. Due to poor economic conditions, many businesses are forced to shut their doors. For some, the damage caused by business failure extends far beyond losing their business. In many small businesses, owners personally guarantee the debt incurred by the business. This means that, if the business fails, the creditors look to the co-debtor, or the owner, for repayment of the debt. Unfortunately, the closing of their business typically means the loss of the owner’s sole source of income, leaving no means to repay the business debts.
Bankruptcy can help relieve business debt and repair the damage caused by business failure. Because there are several types of bankruptcy individuals and businesses can file, there is almost always a solution that is right for each unique set of circumstances.
As a bankruptcy attorney, I am often asked questions about consolidating debts, such as, “How does debt consolidation work?” and “Can I do this to avoid filing bankruptcy?” To be honest, many people who are dealing with debt problems think about debt consolidation loans or other similar solutions at some point. Most people begin wondering how debt consolidation works when they are searching for a way to make creditors and debt collectors stop calling and sending threatening letters. Others begin to explore debt consolidation options only when they are served a lawsuit.
When clients ask me how debt consolidation works, I first begin by explaining the difference between a debt consolidation loan and the use of a debt consolidation company. Before diving into these differences I make an extremely important point: these options generally only work in situations where individuals have the ability to repay their debts, or at the very least, a significant portion of them. There are very few cases where we find that debt consolidation is the best option for solving overwhelming debt problems. To illustrate, let me explain each option and give examples of when it will work and when it is often better to file a bankruptcy.
Debt is one of those situations that cause people to place blame, become depressed and experience intense emotions, such as relentless anger and the feeling of hopelessness. These then trickle into your daily life and cause poor performance at work or tense marital interactions, for example. A challenging financial situation can have a snowball effect, tirelessly enhancing your stress and contaminating your life and relationships.
One of the biggest concerns that most people have about filing bankruptcy is their credit score. As experienced bankruptcy attorneys, we understand our clients concerns about their credit score after bankruptcy. Your credit score affects everything from obtaining new credit, to the amount you pay for your automobile insurance. Credit ratings are vital to our financial stability, and rebuilding credit takes time and patience.
Quality bankruptcy lawyers do more than eliminate your debts - they aim to treat the cause. They devote their time and attention to answering your questions about bankruptcy, providing support, guiding you through each step of bankruptcy and preparing you for life after bankruptcy. Unlike many law firms that try to split their time between several areas of law, we focus 100% on bankruptcy. Because we focus our practice solely on bankruptcy matters, we go beyond helping our clients with debt elimination – we offer counsel on how to have a stronger financial future once you receive your bankruptcy discharge.
If you assume that the role of bankruptcy attorneys is simply to provide legal advice, you are incorrect. They are there to help you overcome the feelings of grief, shame and fear that are often associated with debt problems. As bankruptcy attorneys in St. Cloud, MN, we see hundreds of debtors each month – we want you to know that you are not alone in your struggles. Many of the perceptions associated with filing bankruptcy are false; however, our attorneys understand that the emotional aspect that accompanies a monetary crisis is real.
Sometimes, the best way to understand that you are not alone in your financial distress and the emotional despair that comes with it is to share a story of someone who has been in your shoes. So I’ve asked Patrick* if he was willing to share his story with you. He isn’t the stereotypical candidate for bankruptcy – in fact, most filers don’t fit that mold – and his journey is representative of many that come through our doors.
My story may sound familiar to you if you are dealing with overwhelming debt. My name is Patrick. My wife and I were both successful in our careers and blessed to have a good income to support our children and our lifestyle. This was until I was laid off from my job two years ago. I qualified for unemployment and we managed to make ends meet by cutting expenses and making lifestyle changes. Unfortunately, my unemployment ran out before I was able to find another job. My wife and I both assumed that I would be able to find another job within a short period of time; however, due to the recession and the economy, jobs within my industry were difficult to come by.
After my unemployment ended, we were unable to keep up with our living expenses, in addition to our other monthly bills. Of course, we tried to keep our mortgage and car payments current because they were necessary for our survival. We did not pay our credit cards, personal loans and medical bills in favor of paying our house payment, car payments and living expenses. We managed to hang on for several month months but eventually one of our vehicles was repossessed. Creditors and collection agencies would call at all hours of the day and night, they even began calling my wife at work and threatening to file lawsuits. We received notice that we owed a deficiency on our car loan and they would be seeking a judgment to force us to pay the amount due. It seemed that the more we tried to settle with creditors, the more aggressive and demanding they became.
All of us are subject to drastic lifestyle changes that can have a negative impact on our finances, making it difficult to pay bills. It could be loss of income due to unemployment or reduced hours, a divorce, loss of a spouse, business failure or prolonged illness or medical emergency. The fact is that we never know when we might find ourselves facing a financial crisis due to a lifestyle change.
Charles*, a previous client of mine offered to share his personal bankruptcy story, in hopes that if you are facing a similar situation you might seek help and find comfort in the fact that you are not alone. I am grateful Charles is sharing his story because his experience is the epitome of financial situations taking a turn for the worse, and there was nothing he could do about it. I think many debtors relate to his situation and his emotional struggle to reach out for help.
Divorce and bankruptcy are both realities of life for many individuals. No one sets out in a marriage with the intent to file for divorce just as no one sets out in life with the intent of filing a bankruptcy. However, if divorce and bankruptcy are a future you are preparing for, you’ll need the experience and guidance of an experienced bankruptcy attorney.
Hello, my name is Jane. I am just an average working woman, trying to make ends meet and keep the bills paid. In my mind, bankruptcy should only be relied upon when things are beyond control. However, in my experience, I know that situations can easily and quickly spin out of control. Throw one wrench into a perfectly planned and executed budget – like an unexpected car accident that results in thousands of dollars in unpaid medical bills and a vehicle purchase to replace the one that was totaled – and there you are again, buried in debt.
Most people assume that the only benefit they will receive from a personal bankruptcy is debt elimination. However, personal bankruptcy does more than simply eliminate your debts. Personal bankruptcy aims to treat the cause that brought you to the bankruptcy court, as well as addressing the symptoms of a financial crisis. For example, filing a bankruptcy case will not only eliminate the debt associated with these top five reasons people fall into debt, it will also help them address the symptoms that built up to cause financial crisis.
We receive calls every day from people just like you who are trying to pay their bills but have suffered a financial crisis and have fallen behind. They report that creditors and collection agencies are threatening to take their homes, garnish their wages or levy their bank accounts unless the bill is paid immediately. We hear horror stories of collection agents repeatedly calling their homes, their families or their place of employment to scare them into paying their debts. Angry collection agents bang on their doors or yell into the phone using abusive language and threatening legal action if the bill is not paid. All of these actions are considered creditor harassment and you have rights to make them stop.
If you are drowning in debt, you are not alone. Millions of Americans across the country are...
In my opinion, the single most important tip to rebuild credit after bankruptcy is to not be afraid...
Yes, you can file your own bankruptcy case; however, you probably will not get the results you want...
There are several types of bankruptcy available to business owners who are struggling with...
As a bankruptcy attorney, I am often asked questions about consolidating debts, such as, “How does...
Debt is one of those situations that cause people to place blame, become depressed and experience...
One of the biggest concerns that most people have about filing bankruptcy is their credit score. As...
Quality bankruptcy lawyers do more than eliminate your debts - they aim to treat the cause. They...
If you assume that the role of bankruptcy attorneys is simply to provide legal advice, you are...
Sometimes, the best way to understand that you are not alone in your financial distress and the...
All of us are subject to drastic lifestyle changes that can have a negative impact on our finances,...
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Charles*, a previous client of mine offered to share his personal bankruptcy story, in hopes that...
Divorce and bankruptcy are both realities of life for many individuals. No one sets out in a...
Hello, my name is Jane. I am just an average working woman, trying to make ends meet and keep the...
Most people assume that the only benefit they will receive from a personal bankruptcy is debt...
We receive calls every day from people just like you who are trying to pay their bills but have...
