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Bankruptcy
The bankruptcy code, as dictated by the banking and credit card industries, was altered to a far less consumer friendly form of debt relief in October of 2005. The dismissals of debt, common in chapter 7 filings, were largely done away with as the new version of the code steered most filings toward the far more restrictive protocol of chapter 13 bankruptcies. This is done via a “means” test where filers generating income above their state’s mean average are directed toward chapter 13.
The biggest difference between chapters 7 and 13 is that instead of dismissals of debt, a chapter 13 bankruptcy requires that consumers enter a work-out phase with their creditors. Work-outs are often overseen by a trustee of the court, who can actually dictate how and where a consumer can spend money to make sure that everything available is paid to creditors. Work outs can take anywhere from three to six years to be completed and entail either full or partial payoffs of outstanding debts.
While many of the benefits of filing bankruptcy are no longer available to consumers, the negative aspects of the bankruptcy process remain entrenched. A bankruptcy filing stays on your credit record for up to 10 years, and stays on your public record for life. A bankruptcy on a credit record will pose a big hurdle when applying for any kind of credit and, should an application for credit be approved, will make it far more expensive for the borrower in the form of higher interest rates.
The public record is normally posted in local newspapers for the consumption of neighbors, friends, and other parents. Even after the bankruptcy is removed from credit records, the public record remains accessible to anyone that wants to request it, including prospective employers.
Due to the lack of benefits and long list of disadvantages, filing bankruptcy is now seen as an option of last resort. If you are contemplating a bankruptcy filing, call the team at Debt Settlement Law Office at (800) 466 1845. There are other options available that can provide better, quicker, and longer lasting solutions.
Bankruptcy may remain on your credit report for up to 10 years. With debt settlement law office bankruptcy can be avoided and your debt is reduced. Best of all, once your crediors accept our settlements, the amount will be as payment in full, making you debt free without having to suffer the longer-term financial, emotional, and social impacts of a bankruptcy.
With debt settlement law office bankruptcy can be avoided and your debt is reduced.