Tag Archive for: charlotte bankruptcy attorney

Bankruptcy Or Consolidation?

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Bankruptcy Or Consolidation?

If you are overwhelmed by the choice between bankruptcy or consolidation, there is great news: you have options. Most individuals wait much longer than they should before exercising their options regarding debt—do yourself a favor and act now. The solutions are powerful and the relief is immediate.

Debt Consolidation

Clients who have one looming debt, or smaller debts which are causing problems can consider bankruptcy or consolidation. Generally, debt consolidation combines your debts into one loan. You can accomplish this on your own with a personal loan or a home equity line. You can also hire a debt consolidation company to handle bundling your debt into one payment. If you enter into an agreement with a debt consolidation company, you will typically pay one party each month—the debt consolidation company. However, there are pitfalls associated with working with debt consolidation companies.

Pitfalls Of Debt Consolidation

Debt consolidation companies offer confusing, lengthy contracts which often promise very little to you. We consistently work with clients who believed their debt consolidation company had bundled all of their debt, only to find out it wasn’t true. Those clients make consistent payments and hold up their end of the deal. At the end, they find out there are still one or more credit card balances that remain unpaid. This is a horrible result! Finally, debt consolidation companies consistently remind you they are only estimating the arrangements they can reach with your creditors. In the end, their promises often go unfulfilled.

How Is Debt Settlement Different From Debt Consolidation?

One option in addressing debt is debt negotiation which leads to debt settlement. As a bankruptcy law firm, we have had success negotiating debt for our clients. Our strategy is to show the creditor that we are working with the client to file bankruptcy, which is true. However, in many cases the client would rather settle a debt than file a Chapter 7 or Chapter 13 bankruptcy. This is also true. In the end, the creditor is faced with the option of getting paid little to nothing in bankruptcy, or reaching a fair negotiated agreement with our firm.

The downside to debt settlement is that not all clients have the funds available to successfully engage creditors in negotiations. To reach your best negotiated agreement, the creditor will want the new lower balance paid off very quickly. They are not interested in lowering the balance AND accepting a series of monthly payments extending more than a few months.

Bankruptcy Is Often The Way To Go

If you’re trying to choose between bankruptcy or consolidation, let us help. Filing bankruptcy is one of the most powerful options a consumer has at their disposal. The amount of money you will spend to negotiate one credit card will often exceed the full bankruptcy fee to your bankruptcy attorney. Additionally, you address numerous debts at once. While clients have concerns about credit scores and keeping vehicles or homes, a free phone consultation usually puts the client at ease.

Final Thoughts On The Bankruptcy Or Consolidation Decision

First, we understand bankruptcy is foreign to most individuals. Second, we know there is stress and anxiety associated with debt and the mystery of filing bankruptcy. Lastly, we have seen over and over how our client’s lives change for the better simply by deciding to file bankruptcy. In fact, bankruptcy will change your life for the positive.Most bankruptcy filings usually end with the client giving the lawyer a hug—that should tell you a lot about the relief you will experience if you decide to file.

Speak With A Bankruptcy Lawyer Today

If you’d like to speak with a Charlotte bankruptcy lawyer today, we’re here to help. We are happy to discuss bankruptcy, debt consolidation, or debt negotiation. Part of the job is answering questions. You can reach us at 704.749.7747 or click for a FREE CASE EVALUATION. We know you have choices. We hope you choose to Recover With Us.

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Bankruptcy Expertise — We Made The List Again!

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Bankruptcy “Expertise” And The Layton Law Firm

We are happy to have been chosen by Expertise.com as one of the top 25 Bankruptcy Lawyers or Bankruptcy Law Firms in Charlotte for 2019. Their listing of bankruptcy attorneys in the top 25 can be found HERE. This is our second year on their list!

Yesterday, we also received a call from a bankruptcy attorney in Baton Rouge, LA wanting to know the details of our successful case regarding Bank of America bonuses for a Chapter 7 bankruptcy client. It’s always a compliment to be asked to discuss a case or a particular situation. We know, because often we are seeking advice from other attorneys for similar aspects of a case they handled. The bankruptcy community in Charlotte and throughout the country is very helpful to one another in that way. We are proud to be part of it.

Lastly, we are also proud of the Client Reviews our clients have chosen to leave for us. It’s a sign we’re not only doing good work. It’s also a sign we’re making clients feel good about their choice to use The Layton Law Firm, PLLC.

Considering Filing Bankruptcy?

If you’re considering filing bankruptcy, you deserve to find out more about your options. First, one conversation with a bankruptcy attorney will help you decide. Second, by finding out more about your options, you may discover there’s another way to address your debt concerns outside of filing bankruptcy. An example would be Debt Settlement.  Lastly, the peace of mind that comes with taking action is not to be overlooked.

Protecting Clients Is What We Do

Whether we are working on a personal injury settlement or a bankruptcy, our job is to protect our clients. As a result, we have very close relationships with our bankruptcy clients. Those relationships are necessary to make sure we are disclosing full and accurate information to the  court. Full disclosure is required, in exchange for the powerful relief of bankruptcy.

If a creditor challenges your bankruptcy filing, we will be there to defend you. If a trustee objects to any aspect of your filing, we will be there to defend you. Our negotiation skills and ongoing relationship with the bankruptcy court combine to help you get the best results possible.

Speak With A Charlotte Bankruptcy Attorney Today

If you are considering filing bankruptcy, you should speak with someone. A phone call or in-person meeting is often the best avenue for gaining real clarity about your options. Consequently, we conduct phone consultations every day. If you’d like to request a consultation, simply click for a FREE CASE EVALUATION. You can also call 704.749.7747 to speak with a Charlotte bankruptcy lawyer today. The consultation is always free and we’re here to help.

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Emergency Bankruptcy Petition

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Emergency Bankruptcy Petition

If you need an emergency bankruptcy petition filed, you will need to move quickly. Using a bankruptcy lawyer is highly recommend, especially when filing an emergency petition. Bankruptcy can be a powerful tool to stop foreclosure, prevent judgments or collection of judgments, and discharge credit card debt, medical bills, and other debt. When you file an emergency bankruptcy petition, you usually use it to stop a foreclosure.

Chapter 13 Bankruptcy

If you’re using an emergency bankruptcy petition to stop a foreclosure, most likely you want to keep the house. If that’s the case, you’ll need to consider a Chapter 13 bankruptcy filing. A Chapter 13 allows you to stop the foreclosure, and propose a three to five year plan for repaying the mortgage payments you’ve missed. Provided your Chapter 13 plan is based on your disposable income each month, and proposes to pay back the full missed payments over the plan period, you should receive confirmation of your plan.

How Quickly Can I Get An Emergency Bankruptcy Filed?

Depending upon the situation, an emergency bankruptcy petition can be filed within a day or two. You will have to take the required pre-bankruptcy credit counseling course, which can be done on the computer and takes about an hour and a half. You’ll also have to pay a fee to your bankruptcy attorney in order to get the petition filed. Click here for a quick BANKRUPTCY FEE QUOTE from us.

Will An Emergency Bankruptcy Petition Stop Foreclosure?

Yes, the filing of an emergency bankruptcy petition will stop foreclosure. A notice of the filing will be sent to the county courthouse as well as the mortgage lender and their attorney. The automatic stay in bankruptcy will prevent the lender from moving forward with the foreclosure, provided your bankruptcy attorney follows the rules for Chapter 13. After the filing, provided your plan is confirmed and you continue to make on-time payments, you should continue moving in the direction of being paid and current on the mortgage.

Is There A Downside To Filing An Emergency Bankruptcy Petition?

The only downside to filing an emergency bankruptcy petition is the risk that you and your attorney were not able to be completely thorough in examining your financial picture prior to the filing. This could result in a Chapter 13 payment which is more than you can ultimately afford. This might also become an issue if you’ve made large transfers of assets in the months leading up to the emergency bankruptcy petition filing. This is not an issue for most clients, and the benefits of the emergency filing outweigh any potential downsides.

When Will My First Chapter 13 Payment Be Due?

The filing of your Chapter 13 case sets the payment due date going forward. If you file in the 15th of February, your first Chapter 13 payment will be due on or before the 15th of March. Each payment thereafter will also be due on the 15th.

Speak With A Bankruptcy Attorney Today

Are you facing a foreclosure and want to keep your home? An emergency bankruptcy petition filing may be the answer. Call us at 704.749.7747 or reach out for a FREE CASE EVALUATION and we will be in touch today. We know you have choices. We hope you choose to Recover With Us.

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Benefits Of Chapter 7 — Bankruptcy Can Change Your Life

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Benefits Of Chapter 7 — Bankruptcy Can Change Your Life

Filing Chapter 7 bankruptcy can change your life. We have seen over and over the benefits of Chapter 7, and how much relief it provides for clients. While we understand the desire to pay back creditors, we encourage clients to put their emotional and financial life ahead of creditors. This includes making smart choices for yourself and your family. The benefits of Chapter 7 can be part of that overall plan. We’ve written articles about Whether You Qualify For Chapter 7, which you can read as well.

Get Rid Of Credit Card Debt

Filing a Chapter 7 bankruptcy eliminates credit card debt, provided the debt is more than 90 days old. Credit card lenders have no defense against the benefits of Chapter 7 bankruptcy, so long as you abide by the rules of bankruptcy. Primarily this means disclosing all pertinent information to your bankruptcy attorney before filing, and being honest with the court.

Eliminate Medical Bills

If your medical bills are more than 90 days old at the time of filing your Chapter 7 bankruptcy, they will be discharged by the bankruptcy filing. Whether you can continue to treat with a doctor or medical facility after you’ve filed Chapter 7 depends on the provider. Emergency rooms and hospitals can’t refuse you treatment, whether you have unpaid bills or even if you’ve filed bankruptcy. As to smaller doctor offices, they can choose to no longer treat you for routine healthcare visits. The easiest way to protect a relationship with a doctor you like is to file bankruptcy, and then reach out to the doctor to tell them you have filed Chapter 7 but you will continue to pay on their bill. This will keep your relationship intact.

Clean Up Repossession Debt

If you have remainder debt from a repossession, a bankruptcy will remove your personal liability from that debt. In a vehicle possession, the lender will typically repossess the car and sell it. If you owe more than they recover at the sale, you are responsible for the remainder. By filing a Chapter 7 bankruptcy, you eliminate your liability on the remainder debt.

Eliminate Upside Down Debt

When you file Chapter 7, you have a choice as to whether to keep your property (and the debt that goes with it), or surrender your property (and the debt that goes with it). For example, if you own a vehicle worth $2,500.00 that has a loan balance of $7,000.00, you essentially own a car worth negative $4,500.00. If you went to trade in that vehicle on another vehicle, you would be carrying that extra debt with you into the new purchase. By filing Chapter 7, you can choose to surrender the vehicle to the lender, with all of the extra debt. It’s easier to get into a new vehicle than you might think—we help clients with this situation every day in our office, and it makes all the difference for them.

The same is true of home ownership. If you own a home with negative equity, you can choose to surrender that home and the debt, in Chapter 7 bankruptcy. This prevents the lender from forcing a foreclosure where you may be responsible for any mortgage payoff shortage after the foreclosure.

Discharge Old Tax Debt

While the general rule is that taxes survive Chapter 7 bankruptcy, there are plenty of exceptions. If your tax debt is more than 3 years old, and you filed the tax returns a significant time prior to filing your Chapter 7 bankruptcy, there is a good chance you can eliminate the tax debt with your Chapter 7 bankruptcy. The rules surrounding this are somewhat complicated and deserve a consultation with a bankruptcy attorney in order to accurately determine if your tax debt will qualify for discharge in your Chapter 7 bankruptcy. You can also consider a Chapter 13 bankruptcy to manage tax debt which is less than 3 years old.

Eliminate Judgments

The benefits of Chapter 7 can also include eliminating judgments you may have against you. In conjunction with your Chapter 7 filing, your attorney can file a motion which will address these judgments, provided you either do not own real estate, or you qualify under the equity rules regarding real estate in Chapter 7.

Speak With A Chapter 7 Attorney Today

Consultations are free, and it feels good to take steps to protect yourself and your family. We can be reached at 704.749.7747 or you can request a FREE CASE EVALUATION and we will reach out to you shortly. We know you have choices. We hope you choose to Recover With Us.

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Is My 403b Account Protected In Bankruptcy?

Is My 403b Account Protected In Bankruptcy

Short Answer: Yes.

Much like a 401k plan, 403b retirement plans are protected in bankruptcy. If you are an employee of a state or county school, or a non-profit, you may have your retirement funds in a 403b retirement plan. While these funds do need to be disclosed upon filing bankruptcy, the bankruptcy trustee will acknowledge the bankruptcy exemption protecting those funds.

What If I Withdraw 403b Funds Prior To Bankruptcy?

If you take money out of a 401k or 403b account prior to bankruptcy, you should be aware that you will probably have tax consequences for early withdrawal. In terms of your bankruptcy, you should disclose those withdrawals to your bankruptcy attorney. Typically, those withdrawals will be treated as income for the purposes of passing The Means Test in bankruptcy. While this may sound unfair, this treatment is only for bankruptcy filing purposes, and usually will not upset the results of your Means Test. The Means Test helps to answer the question Can I File Bankruptcy?

Do 403b Loans Survive Bankruptcy?

If you have a loan against your 403b retirement funds, that loan will be treated as a secured loan for the purpose of your bankruptcy filing . In a Chapter 7 filing, the loan will survive the filing. In a Chapter 13 filing, the same result occurs; however, you will typically continue to pay on the retirement loan during your Chapter 13 repayment plan. This will help to reduce the balance and maybe even pay it off during the course of your Chapter 13 bankruptcy.

Speak With A Charlotte Bankruptcy Attorney Today

If you have questions about filing bankruptcy, we’re here to help. Case evaluations and consultations can be conducted by phone and are free of charge. You can call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will reach out to you today. We know you have choices. We hope you choose to Recover With Us.

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Chapter 11 Bankruptcy In NC

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Chapter 11 Bankruptcy In NC

A Chapter 11 bankruptcy is a way to reorganize your business debt while continuing to do business. Chapter 11 enables you to continue your livelihood without the constant threat of creditors to sue you, shut down your business, or otherwise disrupt you from being profitable.

When you file Chapter 11 bankruptcy, you and your bankruptcy attorney are proposing a plan to your existing creditors. Depending upon the profitability and assets of the ongoing business concern, your plan will propose to pay a percentage of your debt to creditors over time.

The Cost of Chapter 11 Bankruptcy

The court charges a filing fee of roughly $1,200.00, together with an administrative fee of $550.00. There are ongoing quarterly fees that must be paid to the court as well. Your attorney fees related to Chapter 11 bankruptcy are hourly. While your bankruptcy attorney will need to evaluate your case before estimating the attorney fees, it is a safe assumption your Chapter 11 bankruptcy will cost somewhere between $10,000.00 – $15,000.00. We know this is a substantial amount of money. Whether to file Chapter 11 will depend upon whether the cost of doing so is outweighed by the benefit to you and your business. Your bankruptcy attorney should help you sort through those questions as you gather information about the business together.

Do My Creditors Have To Accept My Chapter 11 Plan?

No, your creditors do not have to accept your Chapter 11 plan. However, if the plan is reasonable given the income, assets, and overall financials of the business, your bankruptcy attorney will argue on your behalf that the plan should be accepted. Generally, your Chapter 11 plan is a five-year plan; however, you can propose a shorter plan if the shorter plan pays all creditors in full over the course of the plan. Generally, you must commit all of the business’s disposable income over the five-year period to the plan. The calculation of disposable income is an equation involving income and expenses. If income and expenses change significantly during the plan, your Chapter 11 plan may need to be re-evaluated. In this regard, the Chapter 11 bankruptcy is reflective of your ability to pay, both at the time of filing and ongoing during the life of the plan.

Chapter 11 For Corporations vs. LLCs or Partnerships

A Chapter 11 bankruptcy for a corporation will only consider the assets of the corporation. To the extent the individual filing bankruptcy owns the stock of the corporation, the stock assets must be considered in the assets calculations filed with the court.

A Chapter 11 bankruptcy for a partnership, LLC or sole proprietorship, is distinguishable from a Chapter 11 for a corporation or “C-corp”. In this filing, the individual and the business are treated as one for bankruptcy. The result is that all personal assets must be disclosed and considered when proposing the overall plan to pay back creditors over time in Chapter 11.

Chapter 11 vs. Personal Bankruptcy

In many cases, it is preferable to file personal bankruptcy—Chapter 7 or Chapter 13—in lieu of filing a Chapter 11. The cost of filing is considerably lower, and the complexity of the case is different as well. If your company has few assets, you may be able to accomplish your goals by dissolving the company. This will relieve the company’s obligation under company debt. To the extent there is a personal obligation attached to the company debt, a Chapter 7 or Chapter 13 would serve to discharge the individual from that debt.

Speak With A Charlotte Bankruptcy Attorney

The next step is to speak with a Charlotte Bankruptcy attorney. Consultations and case evaluations can be done over the phone or in person. You’ll come away with a much deeper understanding of your options. This alone provides peace of mind. If you decide to move forward with a bankruptcy filing, we can discuss the next steps and take action together immediately. Call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will reach out to you. We know you have options. We hope you choose to Recover With Us.

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Who Will Notify My Creditors About My Bankruptcy Filing?

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This video helps you understand how your creditors are provided notice about your bankruptcy filing. The Layton Law Firm PLLC routinely represents bankruptcy clients in Chapter 7 and Chapter 13.

Who Will Notify My Creditors About My Bankruptcy Filing?

The Bankruptcy Court will notify your creditors about your bankruptcy filing. The most common way that creditors find out about the bankruptcy filing is from a letter directly from the Clerk of the United States Bankruptcy Court.  All creditors listed in your bankruptcy schedules will receive notice of the filing. The form of the letter is known as a B-9A and it contains all kinds of detailed information about the filing.  It lists the debtor, the debtor’s address, and the last four digits of the Social Security number.  It names the attorney for the debtor as well as the address and the phone number.  Of course, it has the case number.  It has the jurisdiction in which the case was filed and most importantly, it has the trustee as well as the date, time, and location of the Meeting of Creditors.  There is also some information on the B-9A regarding what actions certain creditors can take or not take now that a case has been filed. Sometimes, the debtor may not want to wait for letters from the court to reach creditors. According to long time Chicago bankruptcy lawyer David Siegel:

In some situations, you don’t want to wait for the clerk to notify your creditors but you want to have your attorney send an Automatic Stay to the creditor in advance of receiving notice from the clerk.  This would be common if there is a garnishment or other type of court proceeding and you want the creditor to get notice immediately about your bankruptcy filing.  The Automatic Stay is a one-page document that gets sent to creditors either by fax or email notifying them that a case has been filed on your behalf and that certain actions cannot be taken.  Those actions include any type of effort to collect on a debt including sending statements, making phone calls or trying to attach bank accounts or wages.

Only Listed Creditors Will Receive Notice, So be Thorough

It is important to emphasize that only creditors listed on your schedules will receive notice of your bankruptcy filing. If you leave a creditor off your filing, they will not be bound by the discharge.

Having said that, if they do receive notice, they should immediately stop harassing you. If you are having problems with a particular creditor, notify your attorney.  He or she has the ability to send additional notices and motions to take that creditor before the bankruptcy court for sanctions.  Creditors are prohibited from attempting to collect on debts once they receive notice that a bankruptcy case has been filed.

The Bottom Line

As long as you follow the rule of full disclosure, and list all debts and assets, your attorney, as well as the clerk, will help make sure that each creditor is notified about your bankruptcy filing.

Further Reading

Can I Keep Credit Cards In Bankruptcy?

How Long Does Bankruptcy Take?

Speak With A Bankruptcy Attorney Today

If you have additional questions about bankruptcy, or about who will notify creditors about your bankruptcy, call us at 704.749.7747 to get your questions answered and take the next steps toward filing bankruptcy in Charlotte, North Carolina. Or, click for a FREE BANKRUPTCY CONSULTATION and we will reach out to you shortly. The call is free and we’re here to help. We know you have options. We hope you choose to Recover With Us.

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Sears Filed Bankruptcy – Should You?

Sears Filed Bankruptcy – Should You?

News today made it very clear that Sears filed bankruptcy. As a bankruptcy law firm, any time we see a corporation filing bankruptcy, we know it’s a business decision. When it comes to your personal bankruptcy filing, we encourage you to think of it as a business decision as well. This means it’s time to set aside your emotions and do what makes financial sense for you and your family.

Taking The Emotion Out Of Bankruptcy

When we say you should set aside your emotions, we simply mean that your family’s financial health should come before any guilt you feel for not paying back creditors. It also means your family’s health is more important than any guilt you feel in general over filing bankruptcy. Filing bankruptcy can be the smartest financial decision you’ll make for you and your family. It provides a fresh start and you can build on that fresh start.

Picture The Future For Your Family

After years of living paycheck to paycheck, we know it’s hard to imagine a future for you and your family that does not involve scraping by. The truth is, that future does exist. Getting out from credit card debt and other types of debt is a huge step in the right direction. Imagine being able to pay all of your bills each month and have some left over for savings, retirement, or family outings. The federal bankruptcy code offers powerful relief from debt, while letting you keep your home and car by using the Bankruptcy Exemptions.

Learning From The Sears Bankruptcy

The Sears bankruptcy filing reminds us that bankruptcy can be a business decision. In fact, many businesses bounce back after bankruptcy, to be healthier than ever. We’ve seen the same from the clients we work with. Quite often, a few years after filing bankruptcy, we speak with clients who are purchasing a new home and who report their financial lives are incredibly healthy. We can hear it in their voices that they are still happy they chose to end the suffering and file bankruptcy. That makes it all worthwhile for us.

Speak With A Bankruptcy Attorney Today

If you have questions about bankruptcy, call us at 704.749.7747. Or click for a FREE BANKRUPTCY CONSULTATION and we’ll reach out to you. We look forward to helping you get answers to questions. We also know you have choices. We hope you choose to Recover With Us.

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Does Bankruptcy Clear Taxes?

Does Bankruptcy Clear Taxes?

If you’re wondering does bankruptcy clear taxes, you’ll need to know a few things before you can decide. This article helps to answer the question “Does bankruptcy clear taxes”, and we hope it’s helpful. We’re available to discuss this issue with you at no charge—simply call us at 704.749.7747 or click to request a FREE BANKRUPTCY CONSULTATION.

Taxes In Chapter 7 Bankruptcy

The desired result in a Chapter 7 is a Discharge. The discharge means the debt goes away in bankruptcy. In order to receive a discharge of taxes in Chapter 7, a few things need to be true:

  • Your taxes must be at least 3 years old. This is usually the main obstacle. The age of the taxes depends upon the first date they were due. For instance, taxes for 2017 were first due April 15th, 2018. As of April 15th, 2021, those taxes turned 3 years old. If you received an extension on filing until October 15th of 2017, that would be your date to use as the starting date.
  • Only Income Taxes are covered. Some clients owe Sales and Use tax to the federal government. That type of tax is not discharged in bankruptcy. Only income tax is eligible to be discharged.
  • Tax returns must be filed. The date for filing the tax return related to the tax debt is 2 years before filing the bankruptcy. In the example above, even though the taxes are 3 years old, if you had not filed a tax return for those taxes until 1 year before filing bankruptcy, you would not receive a discharge of those taxes.
  • 240 Day Rule. There is a 240 day rule. Simply put, if the IRS assessed the tax, they must have done so at least 240 days before you file bankruptcy.

So, does bankruptcy clear taxes? Well, if all of the conditions above are met, the answer should be YES. One exception relates to an IRS LIEN FOR TAXES. Chapter 7 will not extinguish an IRS lien. So, even if the taxes are cleared by bankruptcy, you’ll still be left with a tax lien which attaches to real estate you own. When that real estate is sold, the tax lien will still need to be paid.

Filing Taxes Before Bankruptcy

While filing your taxes before bankruptcy is often necessary, you can easily see that the 2 year rule will be in violation and would keep some taxes from being cleared in bankruptcy. In order to file Chapter 7, you must have filed taxes for the 2 prior years before filing bankruptcy. That requirement has to be met whether those taxes will be discharged or not by bankruptcy.

Does Bankruptcy Clear Taxes In Chapter 13

One solution for taxes which won’t be cleared in Chapter 7 is to file Chapter 13. In Chapter 13, your existing tax debt which does not meet the requirements above, will be paid back to the IRS on a 5 year plan, with very low or no interest, and without penalties. Your Chapter 13 plan will also discharge taxes which do qualify above, together with other unsecured (credit cards, medical bills) debt. Chapter 13 is also routinely used to catch upon on missed mortgage or car payments. We’re happy to discuss Chapter 13 with you if you like.

Does Bankruptcy Clear Taxes On The Day I File?

No. The taxes are not cleared until you receive your discharge. In a Chapter 7, this means the trustee must close the case after reviewing it, and the court must enter your discharge. Typically, you receive your discharge about 120 days after filing your bankruptcy. Soon after filing, you will attend your 341 meeting with our attorney.

Speak With A Lawyer About Taxes In Bankruptcy

If you’d like to get clarity about anything in this article, or speak with an attorney about your bankruptcy options, simply call us at 704.749.7747 or click to request a FREE BANKRUPTCY CONSULTATION. We know you have options. We hope you choose to Recover With Us.

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Downside Of Filing Bankruptcy

Downside Of Filing Bankruptcy

Clients routinely ask “What is the downside of filing bankruptcy?” While there certainly is a downside to filing bankruptcy, a thorough review of most clients’ financial situation reveals that bankruptcy is the right financial move for them. This article will the downside of filing bankruptcy, but also help to put it in context. As a Charlotte bankruptcy attorney, my goal is to help you decide what’s best for you and your family.

Effect of Bankruptcy On Your Credit Score

Bankruptcy will no doubt affect your credit score. However, this is usually only a concern for those with perfect credit scores coming into bankruptcy. That situation is rare. More often, a client’s credit score is already low due to late payments, missed payments, repossessions, foreclosures, or other financial issues.

The good news is that for most individuals, your credit score one year after filing bankruptcy will be as good as it was on the day you filed. In other words, one year after filing, your credit score has already recovered and you no longer have the debt issues you had before filing. From there, it’s easy to rebuild your credit if you’re intentional about it. Our firm always offers tips on rebuilding credit after bankruptcy, and they do make a difference.

Effect of Bankruptcy On Credit Cards

When you file bankruptcy, you can’t keep “a few credit cards.” All of your credit cards will be canceled upon filing. The good news is you’re no longer living on credit cards. A common question arises regarding having a credit card for emergency purposes. Most clients report to us that credit card companies offer them credit soon after they receive their discharge in bankruptcy. The reason is the bankruptcy filing improved your Debt To Income ratio and made you a great candidate for credit cards. Additionally, creditors like extending credit to individuals who recently filed bankruptcy because they know you’re more likely to repay the debt. After all, you can’t file bankruptcy again for a long time.

Effect of Bankruptcy On Getting A Mortgage

It’s true, you won’t be able to obtain a mortgage for two to four years after bankruptcy. However, you have to ask yourself if you could obtain a mortgage with your current credit score and debt situation. Most clients can’t. So while the intention to purchase a home is a good one, filing the bankruptcy is the first step in the right direction. During the two-year waiting period, you can save for a down payment or pay down student loans, or contribute to your 401k. You won’t fall behind by filing bankruptcy.

Not All Debt

Bankruptcy does not discharge all debt. Some debt takes priority and survives a Chapter 7 or needs to be paid in full in Chapter 13. For instance, Child Support, Recent Taxes (less than 3 years old), Mortgage Arrears, and Student Loans. Clients report that filing bankruptcy and eliminating credit card debt and medical debt, as well as other types of debt, enables them to focus on re-paying the types of debt which do not go away with a bankruptcy filing.

Speak With An Attorney Today

We know deciding to file bankruptcy is an important choice. We tell some clients it’s not a good choice for them. We’re happy to hear your story and help you decide. We know you have choices. We hope you choose to Recover With Us. If you’d like to speak with an attorney today, call 704.749.7747 or click for a FREE BANKRUPTCY CONSULTATION and we’ll give you a call or reply to your email.

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