Chapter 13 Bankruptcy | When Should You File Bankruptcy (Pt. 2)

Chapter 13 Bankruptcy | It’s advised that you wait to file for bankruptcy if you have new debts looming in the future. This is because Chapter 7 bankruptcy only erases debts you have as of the date you file. So if large debts are heading your way, you’ll have to deal with them on your own. An example of this is having to go into surgery. If you file before the surgery, you will have to pay for the medical bills. But if you wait to file after the surgery, you can include that in your filing.

Credit Card Debt

Some people figure that high amounts of credit card debt mean no other options but filing for bankruptcy. That’s not the case though.

There’s nothing fun about not being able to pay off your debt. But debt consolidation can help.While no one likes to deal with debt collectors, it might be your first step to making your mountains of debts into a more manageable molehill. It might even reduce how much you owe.

Debt Settlement

Debt settlement is the process through which companies are able to collect payment on a debt that you owe them. It allows you to negotiate with creditors, or in some cases collection agencies, to reduce the amount owed, thus allowing you to get back on sound financial ground.

What Debt Consolidation Companies Do

A lot of times willpower is not enough to help debtors out of the hole. It’s important that you analyze your spending habits. Going out to dinner every night for a delicious but extravagant meal will not help you pay down your $33,000 Visa debt. You’re going to need to make some changes. But if you have made those changes and you still are not reaping the rewards of your new debt habits, then you might want to seek the help of an expert.

That’s exactly where a debt consolidation company comes in. These companies are kind of like your best friend that stops you from eating that fourth chocolate chip cookie. Debt consolidation companies are there to “save you from yourself” and help you make the right financial moves before your “inner cookie monster” takes over.

Here’s what a debt consolidation (a.k.a. debt management or credit counseling) does:

  • Closes credit accounts so you cannot use them.
  • Sets up an automated monthly payment based on your budget that gets distributed it to your creditors.
  • In some cases, they can negotiate lower APRs or reduced late fees with your creditors.

Considering Debt Consolidation

Debt consolidation can be helpful to anyone: whether you’re considering bankruptcy, or if you are just trying to get a handle on your finances.

What Is Debt Consolidation?

Debt consolidation means that all of your smaller loans get paid off with one large loan. So you essentially get one lump sum to pay off your smaller loans so that you only have one monthly payment rather than several monthly payments. The their behind this is one payment is easier to manage than several. And the main goal is it lower the interest rate and monthly payments while paying off your debt in a quicker amount of time.

Debt Settlement

It’s important to note that debt consolidation is not the same as debt settlement. Debt consolidation allows you to pay your debts in full without causing negative consequences to your credit. Debt settlement is the process of paying off debt to a creditor once a mutually agreed to sum is reached. This sum is usually less than what is owed. Typically, only unsecured debt (for example, credit cards and medical bills), is eligible for debt settlement. Debt settlement is often considered a risky process.

Bankruptcy

If your debt is too high to be consolidated, you might want to consider bankruptcy. A bankruptcy attorney will be able to look at your financial situation and determine if bankruptcy is a viable option for you. They will also evaluate your options for avoiding bankruptcy if other options exist. There are many different ways to discharge your debt and find the financial relief you have been looking for. – Simon Resnik

Specializing in bankruptcy and foreclosure law for over 20 years. Call attorney David Pinkston for a free consultation today: 904.389-5880. #FloridaBankruptcyAttorney #FloridaBankruptcy

If you are thinking about #bankruptcy or #foreclosure in the Jacksonville, Florida area, you should call attorney David Pinkston. David is very experienced with all aspects of bankruptcy law yet very personable and easy to talk to. Call Us Today! 904.389-5880