Is bankruptcy the right choice?

Are you receiving annoying calls from bill collectors at home or work?

Have you been sued because of unpaid bills or received a foreclosure notice?

Are you worried that your wages will be garnished?

Are most of your debts unsecured (such as credit cards or medical bills)?

Are you afraid your car will be repossessed?

Are you falling behind on your mortgage payments?

Are you worried about losing your home in a foreclosure?

Are financial problems interfering with your work or marriage?

If your answer is “Yes” to any of the above, we can help determine if bankruptcy is right for you.

We can stop debt collectors from harassing you.

We can eliminate medical and credit card debts.

We can stop an employer from garnishing your wages.

We may be able to stop your car from being repossessed.

We may be able to save your home if it’s in foreclosure.

Call us today so we can help you get a new start on life.

The Purpose of Bankruptcy

We understand that you may find yourself in a position where you are unable to pay your debts due to any number of circumstances beyond your control, such as loss of a job, illness, or even a payment change on an adjustable rate mortgage.  Like millions of people in the United States, you may be facing insurmountable debt and trying to decide whether filing bankruptcy is in your best interest. 

Bankruptcy should be a last resort for anyone facing financial difficulties. It is generally better to attempt to negotiate an acceptable repayment schedule with your creditors. But sometimes we know that is simply not possible. That’s when you need professional help to determine if bankruptcy will provide the relief you need.

Filing bankruptcy is a tough decision with very serious consequences and obviously should not be undertaken lightly. However, if you're in a difficult financial situation that just keeps getting worse, filing bankruptcy may be the opportunity you need to begin a new financial life. That’s why our country has bankruptcy laws – to help good people through tough times.

Automatic Stay

When a bankruptcy petition is filed, an automatic stay immediately goes into effect.  The automatic stay is a fundamental protection that you will receive by filing bankruptcy. It gives you a breathing spell from your creditors, stopping all collection efforts, all harassment, and all foreclosure actions. It permits the debtor to attempt a repayment or reorganization plan, or simply to be relieved of the financial pressures that drove him into bankruptcy.

Creditors may ask the bankruptcy court for relief from the stay under certain circumstances. A secured creditor may seek relief from the stay in order to proceed with its right to foreclose its lien against the collateral or may require you to make interim payments as a condition to the stay remaining in effect.

The bottom line is that the automatic stay immediately stops most actions against your property by a creditor. If you tired of being harassed by your creditors, are at risk of being evicted or losing property to foreclosure, or having you wages garnished, the automatic stay may provide the relief you need.

Chapter 7

In a Chapter 7 bankruptcy, a bankruptcy trustee will liquidate (convert to cash) your non-exempt assets, if any, to pay, to the extent funds are available, your outstanding debts.  The effect will be to eliminate many unsecured debts such as credit card debt, medical bills, most personal loans, and deficiencies on repossessed vehicles, etc.   However, certain debts are non-dischargeable debts and cannot be eliminated. These generally include child support, student loans, and tax obligations.  When the bankruptcy is filed, an automatic stay goes into effect prohibiting creditors from taking any action against you unless they get relief from the stay.

Before filing for Chapter 7 bankruptcy, you will have to qualify through a means test.  Your monthly income (as calculated under very specific rules) is compared to the median income in your state for a family that is the same size as yours.  If your income is at or below the median income, you qualify for Chapter 7 bankruptcy.  If your income is higher than the median income, then you may still be able to file for Chapter 7 bankruptcy protection, depending upon your disposable income compared with your allowed expenses.

It is important to understand that exemptions protect certain property from liquidation in bankruptcy.  Exemptions typically include all or a portion of the equity in your primary residence, tools, work equipment, a vehicle under a certain market value, certain items of personal property and numerous other categories of property. 

You must also understand that secured debts are generally tied to the assets that secure them. For example, if you want your car loan discharged, you'll have to give back the car since it is collateral for the loan.  If you want to keep your car you may be able to agree to continue making payments in exchange for the right to keep your property.

Chapter 13

If you have financial problems as a result of unforeseen expenses or a period of unemployment or other crisis but now have a regular income and are in a position to make regular monthly payments, filing bankruptcy under a Chapter 13 plan may be the solution.  Many people looking to stop foreclosure or avoid repossession are able to use a Chapter 13 bankruptcy to catch up past due payments (over a period of three to five years) while keeping current payments up to date.

When the Chapter 13 bankruptcy petition is filed, an automatic stay goes into effect prohibiting creditors from taking any further action against you while the bankruptcy case is pending, unless they come into court and get relief from the stay.  A repayment plan (typically over 3 to 5 years) must be submitted to and approved by the trustee.

During that time, you will be required to keep current payments current, and make monthly payments toward past due balances.  Debts are prioritized, and generally secured creditors get paid first, with any remaining disposable income going to pay unsecured creditors.  If all payments are made under the plan, your unsecured debt (provided it is dischargeable) remaining at the end of the plan may be discharged.

Loan Modification

A loan modification is an agreement between you and your lender to modify the terms of your mortgage to make your payments more affordable. But while it’s certainly promising, a long-term loan modification can be hard to negotiate. That’s where we can help.

A loan modification is not always possible, but for some people it definitely is the best solution.  Unfortunately, the process of negotiating with lenders can be confusing and time-consuming, and ultimately frustrating for most people.  You can trust us to put our knowledge and experience to work to get the best possible modification for you.

You may think you could save money by representing yourself, but we believe you would be better off to invest in professional representation.   That way you will know you have done everything possible to modify your mortgage and hopefully avoid foreclosure or bankruptcy.

Stopping a Foreclosure

If you are behind in your mortgage and have received a notice of default, you need to take action. To begin with, you may want to get an opinion of value from a realtor and put the property on the market so you have evidence of the current market value. That will help in any negotiation about modifying your loan (see above.) And you should demand to see copies of your loan documents as the lender may not be able to produce them or there may be a defect in the documentation that gives you a defense to the foreclosure.

If modifying the loan is not feasible, and the mortgage exceeds the property’s current market value, you may want to explore a deed in lieu of foreclosure. This voluntarily transfers the property back to the lender, thereby eliminating the need to file bankruptcy.

In any event, it is imperative that the documents be properly prepared to protect you from any further liability. We know how to do this; further, getting an attorney involved can make all the difference in the world in getting a lender to come to the table. Whatever you do, procrastinating will not solve the problem. Please contact us to see how we can help.

We are a debt relief agency. We help people file for bankruptcy relief under the bankruptcy code.