It is a headache when debt collectors constantly call. Unfortunately, many people get in over their heads in debt and cannot repay it. Consumers may consider bankruptcy to get out of dire financial straits. Bankruptcy can help some consumers, but not everyone. The process is effective for getting rid of unsecured debt, especially credit card debt. When a bankruptcy is filed, the judge issues an automatic stay. This stay means that all collection activities have to stop. Therefore, the nasty calls from debt collectors become a thing of the past. Other activities that are blocked include repossessions and foreclosures.
Most consumers file a chapter 7 or 13 bankruptcy. Visit Lake Law PLLC to schedule a consultation. A bankruptcy lawyer in Huntersville, NC will explain the differences between chapters 7 and 13. A chapter 13 bankruptcy allows the consumer to keep most of their property. However, the consumer must have a regular income. The bankruptcy trustee reorganizes debt and sets up a monthly payment plan. Further, the monthly payment is divided between the creditors. The negative side is that the payment takes up quite a bit of disposable income. The length of the bankruptcy depends on the size of the payments and the amount of debt. Most people have a five-year plan, but it can be done in less time. Afterwards, the consumer receives a discharge as long as they are current on payments.
The other choice for consumers in chapter 7. Some individuals are ineligible if they have recently been in bankruptcy. Call a bankruptcy lawyer in Huntersville, NC to see if you are eligible. The main criteria is the amount of one’s average income. In addition, chapter 7 filers may not be able to keep all their property. The bankruptcy trustee may sell some assets to repay creditors. The lawyer will be able to explain which assets are exempt. Consumers find that the bankruptcy stays on their credit report for a period of time. However, many businesses and banks offer them credit anyway. The important thing is that the individual has a clean slate. It is wise to live within a budget and make sure the debt is not a problem again.
