Avoiding Bankruptcy and Bankruptcy Laws
Life after bankruptcy can be difficult. If bankruptcy can be avoided it of course is highly recommended. A few suggestions on how to avoid bankruptcy follows as well as information on new bankruptcy laws.
- Find a competent debt managing company. Enrolling in a debt management solution that has a good record of accomplishment can go a long way in avoiding bankruptcy. Debt negotiations or debt settlement should only be used to settle medical, utility, or other non-banking type bills. Debt termination or debt cancellation has recently proven the #1 way t wipe out unsecured bank loans or credit card debt.
- Get a debt consolidation loan. This is the #1 choice of Americans to bankruptcy if they still have current or existing loans or are about to get behind in bills.
- Ask a friend or family member for a loan. Borrowing at zero interest can be a great way to avoid bankruptcy if it is possible.
- The most important change in the past few years is no more easy chapter 7. Chapter 7 essentially made it easy t has all your debts cleared. Now you have to take a means test. This test has two parts. The first will use a formula to exempt expenses. This means that your basic living expenses like food and rent are compared to determine if you will be able to return at least 25% of your debt. The bad news here is that an IRS formula is used here and if the IRS calculates that your expenses for something should be lower, you are stuck with it. The second test is if your income is larger then median income of the state you live in, if it is you will have to file Chapter 13, and this means you will have to pay back some of your debt in the next five years.
- You now have to hire a lawyer. Chapter 13 is very complicated to file.
- Credit counseling is now a must, you are required to go through credit counseling for six months following your bankruptcy.
- Some bills will have to be paid such as college loans, which must be paid back completely.
- Very little room has been left for debt problems caused by job sickness, losing a job or any other unforeseeable problems.
Published by Allen Bell
Allen lives in Colorado Springs, Colorado with his wife and two daughters. He is currently a freelance writer who is working on his first novel. View profile
- New Bankruptcy Laws: A Lesson in Being Condescending - Can You Ward Off the Media'...The new bankruptcy laws force more people to file under Chapter 13, and make it harder to find a lawyer willing to follow the stricter guidelines. The new laws were in fact created largely by creditors, and when analy...
How to Determine If You Are Eligible to File for Chapter 7 Under the New...There is a lot of confusion over the new bankruptcy laws that went into effect in October of 2005. Here is how you can determine if you are eligible to file for Chapter 7 under...- Finance Tips for Senior Citizens: A Credit Counseling Agency Can Help You Get Out...You have too many bills and too little money at the end of the month. It wasn't supposed to be this way when you retire. A credit counseling agency can help anyone, including Senior Citizens, get out of debt.
- Can a Consumer Credit Counseling Service Help You Get Out of Debt?As more people are finding themselves in financial debt, they are turning to consumer credit counseling for help. Can this be the answer you may be looking for right now?
- Credit Counseling: Tips for Complying with New Bankruptcy Laws
- Going for Broke with a Bankruptcy Attorney
- Credit Counseling Facts and FAQs
- Consumer Credit Counseling Scams
- Impact of New Bankruptcy Laws on California Real Estate Unclear
- The Disadvantages of Consumer Credit Counseling
- Credit Counseling Vs. Debt Settlement
- Find a competent debt managing company.
- Get a debt consolidation loan.
- Ask a friend or family member for a loan.
The most important change in the past few years is no more easy chapter 7. Chapter 7 essentially made it easy to have all your debts cleared.