Your Ultimate Guide To Chapter 7 Information

Serious heed should be given when making a bankruptcy claim as there is so much to consider. Not least of those considerations is which type of bankruptcy that one should apply for. The main two types of bankruptcy claim are Chapter 7 and Chapter 13 but for the purposes of this article I am going to focus solely on Chapter 7 information.

Essentially, a Chapter 7 bankruptcy is a means of liquidating most if not all of one’s debts. The bankruptcy law states that an individual must apply for a means test to see if he/she will qualify to make a bankruptcy claim under Chapter 7. The means test itself centers round one’s mean income for a six month period in advance of making a claim. Depending on the outcome of this means test, one will either qualify or will have to be further assessed to determine suitability to claim. Generally, if their mean monthly income is less than the state average the individual may be considered to file a bankruptcy petition under Chapter 7. If not, they will be further assessed.

The means test is not the only factor that determines one’s ability to apply. If the individual has made a previous application for bankruptcy, they must have complied with the bankruptcy courts terms and have been present at the court when required. Failure to have been present annuls one’s ‘right’ to apply for a Chapter 7 bankruptcy. Another very important factor is that the applicant must have attended a credit counseling course prior to filing bankruptcy. Only when all of these terms have been satisfied will the Chapter 7 bankruptcy petition proceed.

Unlike a Chapter 13 bankruptcy where a structured repayment plan is drawn up in order to eventually clear the debt(s) this does not happen with a Chapter 7 bankruptcy. Most, if not all of one’s debts will be liquidated – any assets that are considered as being non-exempt (you are not allowed to keep) will be sold and the proceeds distributed among one’s creditors. It will be the role of the trustee who has been appointed by the bankruptcy court to take charge of this.

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Debt Write Off is Only The Beginning

Companies incur a particular expense known as a debt write off.  This expense is incurred when the company gives up any hope of recovering monies owed to them by another company or individual.  Basically, the company is telling the IRS that the prior reported income is no longer income as the money was not collected.  Commonly from many people, this is perceived as a tax reduction or break resulting from the unpaid sale, however there is more to the reality of it all.  It begins with a loss on the materials and time that was involved with the product sold.

If you are unable to pay a debt in any situation, at least avoid the typically misconceptions that are bolstered by settlement attorneys.  Their tactic is claiming the suit against you and the tax deduction is more valuable to the client than accepting any settlement.  Basically this is only a threat, as the tax break can still be taken on the difference from a new settlement and what was previously owed.  Getting full recovery is the most they can obtain with a full write off, and nothing is the least the collector can get, there is nothing in-between do not let them lead you to believe otherwise.

When you find yourself in a desperate situation, it is difficult to work with settlement attorneys.  Wanting their fees up-front the defense attorney convinces you the outcome for you will be positive, while pressure is non-stop from the collector’s law firm.  Your best hope to safely deal with all the parties involved, is by speaking intelligently through the ability to understand the terminology and laws surrounding your situations such as the debt write off clause.  As you deal with your unfortunate situation the ability to add to any conversation with knowledge and understanding of the background facts will absolutely prevent typical blatant abuses by the parties who normally have the best hand, as well as realistic outcomes being discussed.

How to Consolidate Your Credit Card Bills

Credit cards are useful most of the time. People who need money to buy certain items or to pay for unexpected expenses can attest to how useful credit cards are, provided that they are used responsibly. If you need to pay for your hospital bills in an instant, you can rely to these credit cards. All you have to do is to swipe and sign the voucher. However, there are instances wherein people tend to abuse the use of these plastic cards. Thus, they are in need of help to consolidate credit card bills.

What is consolidation?

Credit card consolidation involves the process of combining all your credit card outstanding balances into one account and hoping for a better and lower interest rate that will enable you to pay off your debts eventually within a given period of time. You can do this by following these steps:

  1. List all your outstanding debts. Carefully itemize them and include also the creditor from which you owe the money from and how much interest rates are being charged to you each month or every time you get your billing statement.
  2. After listing them all, look for the creditor that charges the lowest interest rates especially during late payments.
  3. Once you are able to determine, try to canvass the market if there are other bank account providers or creditors that charge lower compared to the lowest that you have.
  4. Try to settle with your creditors and ask them to allow you to transfer all your outstanding balances into a bank account that has the lowest interest charge rates so that you will be able to pay them off.

Asking for third party help

Talking to your creditors about your plans to consolidate your credit card bills can be a very stressful process. If you do not want to be bothered by all these, you can try to get credit card debt help by enlisting the help of a debt management agency. They can talk to your creditors, and even suggest ways on how you can lower down your debts and work your way towards paying them all off.

Apply for a loan

Another thing that you can do to consolidate credit card bills is to go to the bank and avail of their loan with the lowest interest rate. This will enable you to pay off your bills, and at the same time prevent them from accumulating charges from interest.

The Impotance Of Good Credit Report

Anyone can obtain cheap credit report and scores that are pertinent to their personal credit file. Individuals who are concerned about rectifying, and rebuilding their credit history, may already to aware of some free offers. For instance, anyone can request a free copy of their credit report from all three major credit bureaus. These reports are available at the consumers request once a year, at no charge. This is a perfect way to eliminate identity theft, and keep up with credit scores.

Many people have found that keeping track of their credit score helps them maintain control, of their financial obligations. Not knowing everything that is listed on an individual credit report can be damaging, especially when applying for credit. Some people don’t realize that they have erroneous, or outdated information on their credit report, until after they have neither applied for a loan, or been rejected for a job.

The importance of maintaining a good credit history is vital. Many people who need a loan to maintain, improve, or start a new business, find that low credit scores, and bad credit, can hinder the owner from expanding their business. For individuals who may be looking to improve their credit score may be interested in credit repair. Credit repair resources such as classes, and workshops are available to consumers free of charge. The fee to repair individual credit reports can be quite expensive.

Individuals who are interested in saving money, and having misinformation removed from their credit file, have another alternative. They can contact the three national credit bureaus and follow their procedure, on how to have erroneous information removed. This is a free service to consumers. Although, the process may be a little long, but in the end it is worth the wait. The first step to maintaining good credit is to obtain your cheap credit score, from the three major credit bureaus.

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Can Debt Negotiation Services Offer Credit Card Relief?

Getting the guidance of a debt negotiation service is a sensible decision for people with outstanding balances, especially if you are one of those who are having troubles managing your income flow vis-à-vis your spending. However, in enlisting the help of debt management agencies there are several things that you should know and several things that you need to consider.

What is debt negotiation?

Debt negotiation involves the process of talking with your creditors and asking them for lower interest rates on your outstanding balance. For those who have been in debt for months, you cannot hide all your life to you creditors. Some time you have to face your outstanding balances to avoid getting into a legal mess.

Contrary to what most people think, many credit card companies offer help and support to their clients who are in debt. They can recommend you to financial counselors who will help you in managing your debts.

Process of debt negotiation

People who need credit card debt relief usually rely to two things: to themselves, or to debt management agencies. If you are skilled and patient enough to deal with your creditors, you can do the negotiating yourself. You can talk to them about your latest financial situation and why you were not able to pay them for quite sometime.

However if you do not want to be bothered with the endless phone calls and letter exchange, getting the services of licensed debt management agencies is for you. You can leave the work to these experts.

What can debt management agencies do for you?

Debt management agencies are well versed in the different financial situations of every people. They know how they can help you provided that you will cooperate well with them. For example, if you were not able to pay for your credit card bills because you lost your job, they can use this reason to justify to your creditors why you need more time to settle your accounts.

These financial counselors can also help you in terms of settling and negotiating your interest rates. They can ask your creditors to lower it down or even to completely eliminate all your interest charges so that you will not be in more debt.

In choosing which debt negotiation service to get, you should see to it that the company has a professional accreditation of some sort. Sadly, there are some companies who will try to scam you. So do not let this happen to you.

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Student Credit Cards that have 0% APR

The success of this offer has a lot to do with the attitude of the person holding the credit card towards money and his or her finances. There are those who go through trouble because of this supposedly amazing offer.

Companies can inform you that 15 days after you have received the notification, the interest rate on your credit card can climb up to 15% to 30% from 0%. They might have offered you a grace period which might have just caused for more debt to pile up. The saddest part about it is that you might not be allowed to pay it off before the interest rate gets adjusted and they may allow you to send only the minimum payment.

This is the reason why it’s always best to read the Terms and Conditions on the card so that you’d know how and when the interest would change. An instant student credit card could have an interest of 0% for 6 or 12 months depending on the offer of the credit card company.

When I was in college, I had a lot of debt because of a failed business venture and I felt hopeless. I had to find a job so that I could be able to pay the debt. I took a cash advance for $10,ooo at that time to pay off my debt. I had until December to pay it off but it was in August that I realized that I won’t be able to pay it off on time although I have already improved my spending and had a good job. I then found another company that offers an APR of 0% for 12 months and grabbed the opportunity. I paid the first loan through the second and this bought me 12 more months.

It depends on how you use offers for zero and low interest student credit cards to your own advantage.

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