Bankruptcy carries with it a stigma; it ruins your credibility and cripples your ability to borrow money. Although the bankruptcy record disappears of your credit record after seven to ten years, the bankruptcy can continue to haunt you. Most loan applications simple ask “have you ever filed for bankruptcy,” if you say no your can be found guilty of fraud.
If at all possible, an attorney who represents people who wish to file for bankruptcy Huntington Beach will be the first to tell them that if possible, paying the debts, as hard as it may be, is better than declaring bankruptcy. As you think about declaring bankruptcy, here are a few additional things to think about.
* Negotiations: Any creditor would rather settle a debt than lose it all when you declare bankruptcy. If you have fallen behind a few months on your payments, attempt to negotiate a settlement. A creditor will never agreement to a settlement if you’re current, you pose no risk to them. This is not to say that you should go into arrears only to negotiate a settlement, it is just a bargaining tool that is at your disposal.
* Credit counseling: If the attempt to negotiate directly with your creditor fails, perhaps a credit counselor can help with the situation. These people have no magic powers, they know the correct approach these issues and are often successful in arriving at an arrangement where your interest rate is lowered as is your monthly payment. If you do declare bankruptcy in Huntington Beach, the law says you have to have tried credit counseling for six months anyway, so there is nothing lost by trying it now.
* Are you being garnished? If creditors have already managed to get a judgment and your wages are being garnished, bankruptcy can stop this and perhaps get some of your money returned.
* Medical bills: Medical bills are at the forefront of the causes of bankruptcy. Even with health insurance, a major trauma will set the person back and he simply will not be able to pay. When you declare bankruptcy, these past due medical bills will be completely discharged if you file for Chapter 7 or you will have as many as five years to pay them under Chapter 13 protection.
* Assets: If you have no assets or if the assets you have will not cover the debt if they are sold, then bankruptcy may be a good choice. By filing for bankruptcy, you will also be able to secure any assets that are covered with a loan. Assets of this nature would be a car or house, but the payments must be current.
Every individual’s situation is different and you are advised to think hard and then contact a lawyer who prepares for bankruptcy in Huntington Beach.
