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Will Bankruptcy Wipe Out All of My Personal Debts?

December 15th, 2020 at 1:25 pm

debtThe United States is a notoriously consumeristic society. Having good credit is a necessity to buy a home and a reliable vehicle. Credit must be built, often through the usage of credit cards and the ability to repay the credit card debt. Sometimes, however, we accumulate debt and get in too far over our heads. Other times, a major unforeseen life event occurs—one which we are unprepared to handle financially. When this happens, filing for bankruptcy may help struggling individuals and families. When considering bankruptcy, the first question on many minds is, “Will it get rid of all of my personal debts”?

Understanding Bankruptcy

Bankruptcy is a federally approved process through which an individual or a company can reduce their debt. Those who are authorized for the process may have debts written off or repaid under a new agreement. The method used depends directly on the type of bankruptcy approved. The most typical forms of the process are Chapter 11 for businesses or Chapter 7 or Chapter 13 for private consumers, although others are available under appropriate circumstances. These chapters refer to the specific section of the United States Bankruptcy Code that will apply in a given case. Meanwhile, while the process is underway, all collection activities related to your debts—including lawsuits and foreclosure proceedings must stop.

Will All Debts Be Cleared?

If you are wondering whether bankruptcy resets your credit, enabling you to begin as though the debt never occurred, the answer is “no.” Filing for bankruptcy allows those who meet eligibility requirements to rid themselves of some but not all debt. Financial obligations that do not typically qualify to be wiped clean are child support, alimony, taxes, student loans, and secured debt. Although they may not be totally discharged, some may be eligible for a restructured payment plan. Some of the most common discharged liabilities include:

  • Unsecured debt
  • Credit card balances
  • Income tax debt
  • Medical bills

Why Might You Choose Not to File Bankruptcy?

What prevents consumers from racking up unrepayable amounts on credit cards, filing for bankruptcy, and doing it again? It is illegal for employers to discriminate against those filing for bankruptcy, and many things, such as your house, could be exempt from being seized as you progress. However, possible disadvantages do exist, which may give cause you to look for bankruptcy alternatives. These potential drawbacks include:

  • Not all debts are eligible for discharge through bankruptcy.
  • Your circumstances will determine if your home or car must be sold to pay off your debts.
  • Depending on the type of bankruptcy, it can remain on your credit reports for up to ten years, preventing you from obtaining loans and causing increased interest rates.

A Texas Bankruptcy Attorney Can Help

You may know a relative or a friend who told you that filing for bankruptcy wiped away all of their stress and was the best decision they ever made. That is excellent news. However, it is not the right solution for every case. Your financial situation is as unique as your thumbprint, and it requires the assistance of a trained professional to analyze each detail and weigh the options. If you would like help determining if bankruptcy is the best solution for you and your family, contact an experienced San Antonio bankruptcy lawyer at the Law Offices of Chance M. McGhee. Call 210-342-6400 for a free consultation.



How Do I Know if I Should File for Bankruptcy?

July 1st, 2020 at 7:46 pm

Texas bankruptcy attorney, file for bankruptcy in TexasFor many people, the thought of filing for bankruptcy is a scary one. However, for many people, filing for bankruptcy is the best thing they could do for their finances. Filing for bankruptcy allows you to wipe your slate clean and discharge most of your unsecured debts, but it does come with some consequences. Filing for bankruptcy might make your life more difficult in the future, by making it harder to borrow money, lowering your credit score or even affecting your insurance rates. It can be difficult for some people to gauge whether or not bankruptcy is in their best interests, which is where a skilled Texas bankruptcy lawyer can help.

Your Debts Far Exceed Your Income

Think about all of your different types of debt: your mortgage or rent, car payment, all of your different credit cards, and personal loans. How much total debt do you have? Now, think of your income. How much money do you bring in each month? If your monthly debt obligations are much higher than the amount of money you bring in, you may want to consider filing for bankruptcy.

You Face Foreclosure or Repossession of Your Home or Car

Another big reason why people file for bankruptcy is that they are currently experiencing or being threatened with a foreclosure or repossession. When you purchase an expensive object, such as a home or vehicle, it is unlikely that you will buy it outright. Rather, you borrow the money from a lender and repay it over time. If you fail to repay your loan, your property could be taken back. Filing for bankruptcy puts a temporary halt to any foreclosure or repossession actions, giving you time to readjust your finances.

You Have Tried Negotiating with Your Creditors

If you are considering bankruptcy, you have likely already looked at other options for debt relief. One of the easiest things you can do to help lessen the burden is contacting your debtors and seeing if they are willing to work something out with you. Many lenders do not get anything if you file for bankruptcy and will want to work with you, but this is not always the case. If your creditors are unwilling to negotiate or you are still having trouble, bankruptcy might be your best option.

Discuss Your Situation with a San Antonio, TX Bankruptcy Lawyer

Bankruptcy is not for everyone, but for many people, it can give them a second chance with their finances. If you are in debt and are wondering if bankruptcy is right for you, you should speak with a knowledgeable Boerne, TX bankruptcy attorney. At the Law Offices of Chance M. McGhee, we will look over your financial situation with you and determine whether or not bankruptcy would be in your best interests. To schedule a free consultation, call us today at 210-342-3400.




Does Filing for Bankruptcy Affect Employment?

March 26th, 2020 at 4:17 pm

Texas bankruptcy lawyer, TX chapter 7 attorney There are many situations in which a person might resort to filing for bankruptcy. Maybe they or a family member was severely ill and they have tons of medical bills that they cannot afford to pay. Maybe they lost their job and are now getting behind on payments for their bills. Whatever the reason, bankruptcy is usually entered into by individuals who no longer can keep up with their monthly bills because their income is greatly surpassed by their debts. Filing for bankruptcy is often a person’s last chance at trying to reconcile their finances. Most people understand that a bankruptcy affects many areas of their life. What they might not realize, however, is how their bankruptcy could affect their professional life and career.

Can I Lose My Job if I File for Bankruptcy?

The simple answer to this question is no, your employer cannot fire you solely for filing for bankruptcy. According to the United States’ Bankruptcy Code, neither governmental or private employers are permitted to, “terminate the employment of or discriminate…against an individual who has been a debtor or bankrupt under the Bankruptcy Act.”

This means that you cannot be fired, reprimanded, denied a bonus, demoted or otherwise disciplined just because you filed a bankruptcy case. However, if you do happen to experience any of these things after you file for bankruptcy, it can sometimes be difficult to prove that the reason your employer did these things was solely because of the bankruptcy.

Can an Employer Discriminate Against Me Because of My Bankruptcy?

This is where it can become a little tricky. The Bankruptcy Code states that governmental and private employers are both prohibited from discrimination against individuals who file for bankruptcy, but it does not address hiring practices for both types of entities. Government agencies are prohibited from doing nearly anything in relation to an employee who files for bankruptcy, but the same standards are not applied to private employers.

The Bankruptcy Act states that government agencies cannot, “deny employment to…a person who is or who has been a debtor or bankrupt…” When it comes to private employers, the term “deny employment to” has not been included. This means a private employer is not prohibited from denying employment to an individual on the basis that they have filed for bankruptcy.

Are You Worried About How Your Bankruptcy Could Affect Your Career? Contact a New Braunfels, TX Bankruptcy Lawyer Today

One of the biggest financial decisions you may have to make in your lifetime is whether or not you file for bankruptcy. While this could be the best decision for you financially, you may face repercussions, such as issues with your employer. If you are concerned about how your bankruptcy could affect your career, you should speak with a knowledgeable Boerne, TX bankruptcy attorney as soon as possible. At the Law Offices of Chance M. McGhee, we understand how important it is that you protect your finances and your career. Call our office today at 210-342-3400 to schedule a free consultation.



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