The average American household has thousands of dollars in credit card debt. In addition to their credit card bills, many people also have a mortgage and are repaying student loans. When an unforeseen circumstance occurs, all of these bills can be difficult to pay and late fees can drive a family’s debt even higher. If you have found yourself in a situation where you are not able to make the payments on all of your debts, Chapter 7 bankruptcy might be a solution.
Bankruptcy can give you the opportunity to erase many of your debts so you can focus on getting your financial life back on track. Some of the debts that can be discharged include medical bills, credit card bills and some second mortgages. If the majority of your bills are secured, such as a mortgage, auto loans, child support and student loans, bankruptcy may not be a good option for you because those debts cannot be erased.
The first step to filing for bankruptcy is to make an appointment with an attorney. Be sure to bring all of your income and debt information with you to your consultation so your attorney can get an accurate picture of your financial situation. Though you may be embarrassed about the amount of debt you have or the number of late payments on your record, this is not a good time to withhold information. Your lawyer can only help you are honest. A lawyer can tell you whether each of the debts you carry can be discharged in bankruptcy or if you will still be responsible for them after your bankruptcy is complete.
Some people will not qualify for Chapter 7 bankruptcy due to income and asset limits. If you are so far in debt that you cannot pay all of your bills but you make too much money to get them erased, you can still file for Chapter 13 bankruptcy. This portion of the bankruptcy code allows people who have high income or assets to make payments they can afford. A lawyer such as one from Rapa Law Office can determine if you qualify for Chapter 7 or if you need to file for Chapter 13.
