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Archive for the ‘chapter 13’ tag

Top Things You Should Know About Declaring Bankruptcy

March 12th, 2020 at 3:11 am

TX bankrupcty lawyers, TX chapter 7 lawyersBeing in debt can feel like you are drowning, especially if you are so far into debt that you do not see a way out. Whatever the reason for the extreme amount of debt, there are options that you can consider to help with the debt. For many people, bankruptcy can be the right option to relieve them of most, or even all of their debt. However, filing for bankruptcy is not easy and can actually be quite complicated and confusing. Each bankruptcy case is different, so it is not always simple for you to know what to expect after you declare bankruptcy. Here are a few things you should know if you are considering filing for bankruptcy.

Bankruptcy Does Not Happen Overnight

Some people think of bankruptcy as being similar to small claims court where you usually receive your disposition the same day you attend court. This is not the case. The bankruptcy process is complex and typically lasts at least a few months if you file for a Chapter 7 bankruptcy. If you file for a Chapter 13 bankruptcy, the case is open and ongoing for three to five years, the duration of your repayment plan.

Not Everyone Qualifies for Bankruptcy

Not just anyone can get a bankruptcy. Especially for a Chapter 7 bankruptcy, there are certain requirements that you must meet, such as being below a certain income level and passing the means test. The means test is a way of determining your monthly income and expenses to figure out how much disposable income you have each month.

If You Do Qualify, Not All Debts Are Eligible to Be Discharged

Another misconception that people have is that they will be completely free of debt once they have filed for bankruptcy. This depends on a couple of things. First, it depends on the type of bankruptcy you file and second, it depends on the type of debt you have. Most unsecured debt will be discharged in a Chapter 7 bankruptcy, such as credit card debt. However, student loan debt, federal, state and local taxes, alimony and child support debt cannot be discharged or forgiven in bankruptcy.

Your Bankruptcy Will Affect Your Credit

Though bankruptcy can have a huge effect on your life, perhaps one of the most prominent effects is what bankruptcy does to your credit. After a Chapter 7 bankruptcy is finished, it will be reported on your credit report and will stay there for up to 10 years. Most creditors will shy away from loaning money to someone with bankruptcy, so it may be hard for you to open a credit card, take out a mortgage or buy a car.

A New Braunfels, TX Bankruptcy Attorney Can Help

If you are unsure of whether or not bankruptcy is right for you, you should talk with a skilled San Antonio, TX bankruptcy lawyer. At the Law Offices of Chance M. McGhee, we can help you understand all of your options available to you to manage your debts. We can also help you make the right decision about what is best for you and your family’s situation. To schedule a free consultation, call our office today at 210-342-3400.

 

Sources:

https://www.thebalance.com/top-things-to-know-about-bankruptcy-316198

https://www.thesimpledollar.com/credit/bankruptcy/what-to-expect-when-filing-for-bankruptcy/

 

What Does the Texas Bankruptcy Process Look Like?

February 14th, 2020 at 4:33 pm

BankruptcyTexas bankruptcy attorney, TX chapter 7 attorney, TX bankruptcy process, is the legal process of determining whether or not a person or business is actually unable to pay their debts and if their debts should be discharged. For individuals, there are two main types of bankruptcies — Chapter 7 and Chapter 13. In a Chapter 7 bankruptcy, typically the filer has their debts discharged or forgiven at the end of the process. In a Chapter 13 bankruptcy, the filer’s debts are reorganized and a repayment plan is entered for three to five years to pay off as much of the debt as possible.

According to statistics from the Judiciary Data and Analysis Office, the most common type of bankruptcy that is filed is Chapter 7 bankruptcy, which made up around 60 percent of all bankruptcy filings in 2017. If you are thinking about filing for a Chapter 7 bankruptcy, it is important that you understand the process.

Before You File

The first step in the bankruptcy process is to get a firm grasp on your financial situation. You should gather all of your documents that are needed for bankruptcy now so that you can look at the whole financial picture and because you will also need them as proof when you go to file. You will need documents such as:

  • A copy of your credit report
  • Tax returns from the past two years
  • Proof of income from the past six months
  • Bank, retirement and brokerage account statements
  • Valuations of any real estate you own
  • Title and loan information on your vehicles, if you own any

Preparing and Filing Your Documents

The most time-consuming portion of the bankruptcy process is just filling out the forms needed to actually file. This is where an attorney would come in handy. There are around 70 pages of information that you must fill out, much of it requiring a lot of calculations and writing down repetitive information. Your attorney would be able to do most of this legwork for you, making sure that calculations and information are correct and preventing any delays in filing. If you file the forms yourself, you must go to the courthouse in person, file the forms with the clerk and pay the $335 filing fee. If you hire an attorney, he or she will do this for you.

Credit Counseling Requirements

As a requirement of filing for bankruptcy, you will also have to complete two counseling courses. The first one is a credit counseling course and should be completed before you file. The second course is centered around debt education and must be completed after you file, but before your creditors’ meeting.

Meeting of Creditors

The final step in the process is attending your 341 Meeting or your Meeting of Creditors. The point of this meeting is to ensure that all of your information on your forms is correct and that you are not hiding any assets or income that could be used to repay your debts. A majority of the time, creditors’ meetings only last about five minutes and end with your debts being discharged and your bankruptcy complete.

Our Knowledgeable San Antonio, TX Bankruptcy Attorneys Can Help

Though it is not required to have an attorney when you file for bankruptcy, it can greatly help your case by preventing mistakes you might not even know you are making. At the Law Offices of Chance M. McGhee, we can help you get your life back on track and file for bankruptcy. Call our Boerne, TX bankruptcy lawyers today at 210-342-3400 to set up a free consultation.

 

Sources:

https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/process-bankruptcy-basics

https://upsolve.org/learn/how-to-file-bankruptcy-2019/

https://www.uscourts.gov/news/2018/03/07/just-facts-consumer-bankruptcy-filings-2006-2017

 

Can You Incur More Debt During a Chapter 13 Repayment Plan?

December 27th, 2019 at 12:38 am

debtIf you have gotten a bankruptcy, the one thing you do not want to do is to incur more debt; being unable to pay your debt is the reason you filed for bankruptcy, right? Chapter 13 bankruptcy repayment plans usually last anywhere from three to five years, meaning you must be financially responsible during that time period or you could risk having your case dismissed and being responsible for repaying your debts in full. While it is a good rule of thumb to avoid taking on any further debts during a Chapter 13 bankruptcy, sometimes taking on more debt is unavoidable and is a necessity. Incurring new debt during your Chapter 13 repayment period is possible, but there is a certain way you must go about it.

Reasons for Incurring New Debt

Sometimes, life can be unpredictable. Even though you were probably not planning on taking on any new debts during your Chapter 13 repayment period, things can happen and can put you in a situation where there is no other option. Generally, incurring new debt during a Chapter 13 repayment period is frowned upon and is only permitted when the debt is for something that is considered a necessity. Common reasons for incurring debt during a repayment plan include:

  • Refinancing a mortgage on your current home
  • Purchasing a new home or a new vehicle
  • Financing equipment needed for necessities, such as a new water heater or furnace

Filing a Motion to Incur Debt

Before you take on any new debt, you must speak with your bankruptcy trustee about filing a motion to incur debt. If you were to take on new debt without notifying the court or your trustee, you could risk having your bankruptcy case dismissed, leaving you in an arguably worse financial situation than before. To file a motion to incur debt with the court, you will need to provide the following information:

  • Proof of income for at least the past 60 days
  • An updated list of your monthly expenses
  • Information about the loan and the financing company, including how much the loan is for, the interest rate of the loan, the length of the repayment period and how much the estimated monthly payment would be

The court will examine your motion and make a determination on whether or not the debt is necessary, whether or not you will be financially able to make the monthly payments and whether or not the new debt will interfere with your ongoing bankruptcy repayment plan.

Contact a San Antonio, TX Chapter 13 Bankruptcy Attorney For Assistance

Making the decision to file for bankruptcy can be a difficult one, but it can ultimately end up being the best financial decision you make for yourself. If you are currently in a Chapter 13 repayment plan, you likely know that there are limitations to what you can do with your money. If you need to incur debt during your repayment period, you need help from a Schertz, TX Chapter 13 bankruptcy lawyer. At the Law Offices of Chance M. McGhee, we can help you correctly file a motion with the bankruptcy court to allow you to take on more debt during your repayment period. Call our office today at 210-342-3400 to schedule a free consultation.

 

Sources:

https://www.carsdirect.com/auto-loans/what-s-an-authorization-to-incur-debt-with-a-chapter-13

https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-13-bankruptcy-basics

 

Priority Debts in a No-Asset Chapter 7 Case

November 25th, 2019 at 8:00 am

Priority debts are largely unaffected by a Chapter 7 case—it does not discharge them, so you need to pay them after finishing your case.

 

Most Chapter 7 Cases Are No-Asset Cases

Chapter 7—“straight bankruptcy”—is the most common type of consumer bankruptcy case. They are generally the most straightforward, lasting about 4 months start to finish. Usually everything you own is protected by property exemptions. You discharge, or legally write off all or most of your debts. Secured debts like a home mortgage or vehicle loan are either retained or discharged. You either keep the collateral and pay for it, or surrender it and discharge any remaining debt. Bankruptcy does not discharge certain special debts like child/spousal support and recent income taxes.

A “no-asset” Chapter 7 case is one, as described above, in which everything you own is covered by property exemptions. So you keep everything you own (with the exception of collateral you decide to surrender). It’s called a no-asset case because your Chapter 7 trustee does not get any assets to liquidate and distribute to any of your creditors. The trustee just verifies that you have no unprotected assets. He or she does this mostly by reviewing your bankruptcy documents and asking you some simple questions at your hearing. A large majority of Chapter 7 cases are no-asset ones. Your bankruptcy lawyer will tell you if yours is expected to be.

Although Chapter 7 is theoretically a liquidation form of bankruptcy, in a no-asset case there is nothing to liquidate. You lose no assets, and you lose all or most of your debts.

What Happens to Your Special, Priority Debts in a No-Asset Chapter 7 Case?

Yes, what about debts that do not qualify for discharge? There are various types of such debts, although most cases have either only one or two not-discharged debts, or none at all.

Most debts that Chapter 7 does not discharge are what are called priority debts. These are simply categories of debts that Congress has decided should be treated with higher priority than other debts. In consumer cases the most common priority debts are child/spousal support and recent income taxes. See the U.S. Bankruptcy Code subsections 507(a)(1) and (8). (Not to go into the rules here, but many older income taxes are not a priority debt and can be discharged.)

Priority debts generally get paid ahead of other debts in bankruptcy. This is true in an asset Chapter 7 case—where the trustee is liquidating a debtor’s assets.  In fact the trustee must pay a priority debt in full before paying regular (“general unsecured”) debts a penny!

But in a no-asset Chapter 7 case the trustee has no assets to liquidate. So he or she cannot pay any creditors anything, including any priority debts. So, essentially nothing happens to a not-dischargeable priority debt in a no-asset Chapter 7 case.

Dealing with Priority Debts During and After a Chapter 7 Case

However, one benefit you receive with some priority debts is the “automatic stay.” This stops (“stays”) the collection of debts immediately when you file a bankruptcy case. This “stay” generally lasts the approximately 4 months that a no-asset case is usually open. This no-collection period gives you time to make arrangements to pay a debt that is not going to get discharged. So you can start making payments either towards the end of your case or as soon as it’s closed. The hope is that you’ve discharged all or most of your other debts so that you can now afford to pay the not-discharged one(s).

The automatic stay applies to most debts, but there are exceptions. Child/spousal support is a major exception. Filing a Chapter 7 case does not stop the collection of support, either unpaid prior support or monthly ongoing support. (Note that Chapter 13 “adjustment of debts” can stop the collection of unpaid prior support under most circumstances.)

So, with nondischargeable priority debts that the automatic stay applies to, during your case you and/or your bankruptcy lawyer make arrangements to begin paying the debt. With ones that the automatic stay does not apply to, you need to be prepared to deal with immediately.

If neither of these make sense in your situation, consider filing a Chapter 13 case instead. Talk with your bankruptcy lawyer about the advantages and disadvantages of each option. Chapter 13 takes a lot longer—from 3 to 5 years usually. But if you have a lot of priority debt (or secured or any other nondischarged debts), it can really help.

 

What Does a Bankruptcy Trustee Do?

September 16th, 2019 at 4:40 pm

trusteeThe most common types of bankruptcies that are filed in the United States are Chapter 7 and Chapter 13 bankruptcies. There are many differences between a Chapter 7 bankruptcy and a Chapter 13 bankruptcy, mainly in the way that the debts are handled. While these two types of bankruptcies differ greatly in many aspects, they do have one thing in common — they both utilize a bankruptcy trustee.

If you have thought about getting a bankruptcy or you have done research about getting one, you have probably come across the term — but do you know what a bankruptcy trustee is? It is important to understand the role of the trustee if you are getting a bankruptcy or considering one.

What Is a Bankruptcy Trustee?

A bankruptcy trustee is a person who works on a bankruptcy case to act as the middleman between the debtor and the creditors. The trustee is not an employee of the bankruptcy court, but rather an independent contractor who is hired to prevent the court itself from having to collect and/or distribute property. Trustees are also responsible for reviewing all financial information that is submitted by the debtor to ensure it is accurate and true.

Trustees in a Chapter 7 Bankruptcy

In a Chapter 7 bankruptcy, or liquidation bankruptcy, your non-exempt assets are liquidated or sold so that you can repay as much of your debt as possible before the rest of it is discharged. A trustee in a Chapter 7 bankruptcy is responsible for determining which of your assets are non-exempt and using the money from those to repay your debtors.

Trustees in a Chapter 13 Bankruptcy

In a Chapter 13 bankruptcy, you reorganize your debts so that you can come up with a three- to five-year repayment plan to pay back all or most of your debts. In this type of bankruptcy, your trustee is responsible for overseeing the repayment plan. He or she will collect your payment each month and distribute it to your debtors.

Questions About the Bankruptcy Process? A San Antonio, TX Bankruptcy Attorney Can Help

Making the decision to file for bankruptcy is a serious one. Your credit score will be affected and the bankruptcy will appear on your credit report for a number of years. Ultimately, the bankruptcy trustee can affect your bankruptcy case for the good or the better, which is why it is important to understand their role in your bankruptcy case. If you are thinking about filing for bankruptcy, you should talk with a knowledgeable Boerne, TX bankruptcy lawyer. At the Law Offices of Chance M. McGhee, we can help make sure your bankruptcy process is smooth and as stress-free as possible. Call our office today at 210-342-3400 to schedule a free consultation.

 

Sources:

https://www.investopedia.com/terms/b/bankruptcy-trustee.asp

https://www.creditkarma.com/advice/i/bankruptcy-trustee/

https://www.thebalance.com/who-is-a-bankruptcy-trustee-316199

Which Type of Bankruptcy Is Right for Me?

August 19th, 2019 at 2:15 pm

bankruptcy-typeIn the United States, there are many different types of bankruptcies, some being for businesses, government sectors or individuals. If you are an individual filing for bankruptcy, the two most common types of bankruptcies that are filed are either Chapter 7, which is a liquidation bankruptcy, or Chapter 13, which is a reorganization bankruptcy. Each type of bankruptcy has its advantages and disadvantages, along with different sets of criteria to qualify for each type of bankruptcy. If you are unable to pay your bills each month or you are struggling to make ends meet, bankruptcy may be in your best interest. Choosing the right type of bankruptcy for your situation can be the key to your financial success.

Chapter 7 Basics

A Chapter 7 bankruptcy is also known as liquidation bankruptcy. This is because all of your “unnecessary” assets will be liquidated to help pay off some of your debts before your debts are forgiven. Most unsecured debts, such as credit card debt, will be discharged in a Chapter 7 bankruptcy, meaning you will no longer be responsible for paying them. It takes roughly three to four months to complete a Chapter 7 bankruptcy, which is a relatively short time frame.

To qualify for a Chapter 7 bankruptcy, you must pass a means test, which is a test that is used to determine whether or not you are actually able to repay your debts. If you pass the means test or your income is less than the median income level for Texas, you will most likely qualify for a Chapter 7 bankruptcy. If you earn too much, you may be denied.

Chapter 13 Basics

A Chapter 13 bankruptcy is known as reorganization bankruptcy because your debts will be reconfigured into affordable monthly payments. This type of bankruptcy allows you to repay some or all of your debts over the course of three or five years, depending on your income. At the end of the repayment period, the rest of your unsecured debts will be discharged. Chapter 13 bankruptcies allow the person filing to keep all of their property, even property that is deemed to be a “luxury” item in Chapter 7 bankruptcies.

Those who earn too much income to qualify for a Chapter 7 bankruptcy may qualify for a Chapter 13 bankruptcy. Most people who have regular monthly income can qualify for a Chapter 13 bankruptcy because there are no income requirements. However, a person must have less than $419,275 in unsecured debt and less than $1,257,850 in secured debt.

Unsure of Which Type of Bankruptcy You Should Go With? Contact a New Braunfels, TX Bankruptcy Lawyer

Filing for any type of bankruptcy has consequences that you must deal with after everything is said and done. Though these consequences sometimes differ depending on the type of bankruptcy you choose, they can still affect your life. If you are wondering which type of bankruptcy would be best for your financial situation, or if you should file for bankruptcy at all, a skilled San Antonio, TX bankruptcy attorney can be an invaluable asset. Contact the Law Offices of Chance M. McGhee today to see how we can help you find solutions for your debt. Call our office at 210-342-3400 to schedule a free consultation.

 

Sources:

https://upsolve.org/learn/every-type-of-bankruptcy-explained/

https://www.credit.com/debt/filing-for-bankruptcy-difference-between-chapters-7-11-13/

Qualifying for Bankruptcy in Texas

August 14th, 2019 at 10:22 am

Texas bankruptcy lawyer, TX chapter 7 attorney, A bankruptcy can help by allowing you to discharge your debts and no longer be legally responsible for repaying those debts, giving you the chance to start over. This blank slate comes with a price, however. Filing for bankruptcy will affect your credit score and can make it harder to get future loans or credit cards. Nevertheless, for many people who are in financial trouble, there is no other way to remedy the situation but to file for bankruptcy. There are two types of bankruptcies that are commonly filed by individuals in the United States — Chapter 7 bankruptcy and Chapter 13 bankruptcy. Each type of bankruptcy has its own way of helping those who are in insurmountable debt, with Chapter 7 bankruptcy discharging most or all of your debts and Chapter 13 reorganizing your debts into more manageable monthly payments. Qualification requirements also vary depending on the type of bankruptcy you choose to go with.

Chapter 7 Bankruptcy

The idea behind a Chapter 7 bankruptcy is that you do not have enough income to repay all of the debts that you owe. As such, most of your debts are discharged in a Chapter 7 bankruptcy. In 2005, bankruptcy laws changed to add income limits to qualify for a Chapter 7 bankruptcy. The past six months of your income will be used to determine whether or not you qualify for a Chapter 7 bankruptcy along with the number of people in your household. Generally, the income limits are as follows:

  • Single person: $40,389
  • 2-Person Household: $54,762
  • 3-Person Household: $59,276
  • 4-Person Household: $65,932
  • Add $7,500 for each additional person over four household members

Chapter 13 Bankruptcy

Qualifying for a Chapter 13 bankruptcy is slightly different. A Chapter 13 bankruptcy will allow you to reorganize your debts and make affordable monthly payments over three or five years. Because you are still technically paying all or most of your debts, you must prove that you have regular income and a sufficient amount to pay those debts. Next, your debts must not be above the thresholds. Unsecured debts, such as credit cards and personal loans, must be below $394,725. Secured debts, such as a mortgage or auto loan, cannot be more than $1,184,200.

Unsure if You Qualify for Bankruptcy? Contact a San Antonio, TX Bankruptcy Attorney Today

Financial troubles are never easy to deal with, especially when you have to deal with a bankruptcy. If you believe that bankruptcy is the best course of action for your financial issues, your next move is to determine which type of bankruptcy you qualify for. At the Law Offices of Chance M. McGhee, we can help you determine which type of bankruptcy is right for your particular case. With help from a Boerne, TX bankruptcy lawyer, you can be sure that you are receiving helpful and accurate advice. Call our office today at 210-342-3400 to schedule a free consultation.

 

Sources:

https://www.experian.com/blogs/ask-experian/bankruptcy-chapter-7-vs-chapter-13/

https://www.creditkarma.com/advice/i/what-is-chapter-13-bankruptcy/

 

What to Expect at a 341 Meeting of Creditors

July 19th, 2019 at 6:49 pm

TX bankruptcy lawyer, TX chapter 7 attorney Once you have made the decision to file for a Chapter 7 bankruptcy, prepared and filled out all required paperwork and filed that paperwork, you will have to attend a meeting. This meeting is referred to as a 341 meeting of creditors and will take place at a time, place, and location that is determined by the bankruptcy court and will include your bankruptcy trustee and creditors. This can be a nerve-wracking time for you because the trustee will ask you a series of questions about your application to ensure you are not trying to commit bankruptcy fraud and to discover whether or not you have nonexempt assets that could be sold to repay all or part of your debts.

During the Meeting

Prior to the 341 meeting of creditors, the bankruptcy trustee will have already reviewed your paperwork and financial records. During the meeting, the trustee will ask you a series of questions to gather more information about your case. By federal law, during the meeting, the trustee is required to ensure that you are aware of:

  • The consequences of filing for bankruptcy, such as the impact it will have on your credit history
  • Your ability to file for bankruptcy through different means, such as a Chapter 13 bankruptcy
  • The effect that receiving a discharge of your debts through a Chapter 7 bankruptcy will have
  • The effect of reaffirming a debt

The trustee will also ask you questions about why you are filing for bankruptcy, your monthly income and expenses, assets, debts, marital status and any dependents you might have. They will also want to know about any other financial obligations you may have, such as child support or spousal maintenance. The trustee will want to make sure that you do not have any assets that are not exempt that could be used to repay all or part of your debts. You will also have to attest, under oath, that all of the information that you have provided is true.

A Schertz, TX Chapter 7 Bankruptcy Attorney Can Help

If you are thinking about filing for a Chapter 7 bankruptcy, there are certain requirements you must meet and procedures you must take. Help from a knowledgeable New Braunfels, TX Chapter 7 bankruptcy lawyer can be extremely helpful throughout the bankruptcy process. At the Law Office of Chance M. McGhee, we can help you prepare for your creditor meeting and we will also accompany you to the meeting to ensure your rights are protected. Call our office today at 210-342-3400 to schedule a free consultation.

 

Sources:

https://www.investopedia.com/terms/1/341-meeting.asp

https://www.law.cornell.edu/uscode/text/11/341

What Not to Do Before Filing for a Texas Bankruptcy

April 26th, 2019 at 2:38 pm

Texas bankruptcy attorneyFor many people who have quite a bit of debt, bankruptcy is the best option. There are two types of bankruptcies that individuals can file for in the United States — Chapter 7 and Chapter 13 bankruptcies. A Chapter 7 bankruptcy is one that discharges most of your debt and leaves you with a blank slate so you can rebuild your finances. A Chapter 13 bankruptcy is basically a reorganization of your debts — you work with your debtors to come up with a repayment plan that works for you. In either of these scenarios, there are certain things that are big no-no’s. It is important that you avoid these common mistakes when filing for a Texas bankruptcy:

Lying or Withholding Information from Your Attorney

Though it may seem beneficial to lie or hide certain assets from your attorney, it is quite the opposite. It is against the law to attempt to hide assets or omit them from your list of assets that you submit to the bankruptcy court. Not only could your bankruptcy case be rejected, but you can also face criminal charges related to bankruptcy fraud.

Acquiring New Debt After You Have Started the Process

In a Chapter 7 bankruptcy, most if not all of your debts are discharged. It may be tempting to take your credit card and go on a shopping spree before you file for bankruptcy, but that is the last thing you should do. Incurring new debt within 90 days of filing for bankruptcy is highly frowned upon and will most likely not be dischargeable in your bankruptcy, meaning you will be responsible for repaying that debt.

Giving Money or Property to Your Friends or Family

Similar to lying about your assets, it is also not a good idea to try to give money or other property to your friends or family before you file for bankruptcy. This is also illegal and can put your bankruptcy case in jeopardy, along with possible criminal charges and repercussions.

Not Hiring a Skilled New Braunfels, TX Bankruptcy Lawyer

The bankruptcy process can be overwhelming for many people — there is a lot of paperwork that must be filed and there are many legalities that must be followed. At the Law Offices of Chance M. McGhee, we take the confusion out of bankruptcy and help you avoid making these costly mistakes. Let our knowledgeable Kerrville, TX bankruptcy attorneys guide you throughout the bankruptcy process and lead you on a path to financial wellbeing. Call our office today at 210-342-3400 to set up a free consultation.

 

Sources:

https://www.allbusiness.com/13-mistakes-avoid-filing-chapter-13-bankruptcy-12340-1.html

https://www.myhorizontoday.com/bankruptcy101/five-common-mistakes-debtors-make-when-filing-bankruptcy/

https://www.debt.org/blog/what-not-to-do-before-filing-bankruptcy/

Frequently Asked Questions About Texas Bankruptcy

April 12th, 2019 at 10:11 pm

TX bankruptcy attorneyBeing in debt can often feel like being in quicksand — the more you try to climb your way out, the quicker you sink further. Making the decision to file for bankruptcy is a very serious one and should only be made as a last resort. Because of this, most people who file for bankruptcy are in an overwhelming amount of debt. This can cause much uncertainty and may have you wondering how you should file, which type of bankruptcy is right for you and what your life will look like after your bankruptcy is done. Here are a few frequently asked questions about bankruptcy and their answers:

When Should I File For Bankruptcy?

This is a very personal question and because of that, the answer will never be the same for all people. There is a general rule of thumb when it comes to deciding when you should file for bankruptcy — it should be your last resort. Before you file for bankruptcy, you should try other ways of relieving debt, such as budgeting and consolidating your debt. If you feel that you are drowning in debt, it may be time to consider bankruptcy.

Which Type of Bankruptcy Is Right For Me?

For private consumers, there are two types of bankruptcies that you can apply for: Chapter 7 and Chapter 13 bankruptcies. A Chapter 7 bankruptcy is the most common type of bankruptcy where most of your debt is discharged and you are given a clean slate. A Chapter 13 bankruptcy utilizes a repayment plan to help you pay off your debts, rather than discharging them. The kind of bankruptcy that is best for you depends on a variety of factors — which you should talk to your attorney about.

How Will a Bankruptcy Affect My Credit Score?

It is never known for sure how exactly a bankruptcy will affect your credit score because beginning scores can range. If you have a higher beginning credit score, you will usually lose more points than a person with a lower credit score. Regardless, most people’s credit scores will fall within the same range after a bankruptcy — usually, somewhere within the mid- to high-500 range.

A New Braunfels, TX Bankruptcy Attorney Can Help

Filing for bankruptcy can be a long and confusing process. There are many things you must consider before you file for bankruptcy and there are many questions that come along with the process. This is where a skilled Kerrville bankruptcy lawyer can be extremely helpful. At the Law Offices of Chance M. McGhee, we can help answer all of your bankruptcy questions and we can also help you make the best decisions for your situation. Call our office today at 210-342-3400 to schedule a free consultation.

 

Sources:

https://www.bankrate.com/finance/debt/life-after-bankruptcy-1.aspx

https://www.investopedia.com/articles/pf/07/after-bankruptcy.asp

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