Bankruptcy Law Firm in Memphis, TN
Many people who file for bankruptcy are able to get credit after they emerge from bankruptcy. Creditors look at income, debt, and ability to repay when offering credit to people. Bankruptcy doesn’t have to be the end. In fact, it’s really the beginning. The start of a new life for you.
What is a bankruptcy stay?
When bankruptcy is filed, an automatic stay goes into effect. This means creditors are prohibited from contacting you or trying to collect their debt. What stops?
- Harassing phone calls
All legal action against you stop. Everything halts so you can catch your breath. You have options when it comes to bankruptcy.
Chapter 7 bankruptcy
Chapter 7 bankruptcy allows you to eliminate all of your debt. Chapter 7 bankruptcy provides you the ability to have your credit card debt erased. Credit card debt can be debilitating. Sometimes you need a fresh start and Chapter 7 bankruptcy might be your solution.
Chapter 13 bankruptcy
Chapter 13 bankruptcy is different from Chapter 7 in that not all of your debt is eliminated. Under Chapter 13 bankruptcy, you get a payment plan to repay your debt. Generally, this payment plan takes place over the course of three to five years. This allows you to keep your possessions while also repaying the debt. The debt is forgiven at the end of your payment plan.
The best part of this is that you determine how much money you pay each month to your creditors. Skilled bankruptcy attorneys help you determine your recurring monthly costs to see what you can include in your payment plan.
What happens after bankruptcy?
Being smart with money is important. For many people, this doesn’t happen. Whether because of a bad economy or some bad choices, people find themselves in debt. Attorneys have the roadmap to financial success.
Bankruptcy allows people to get their fresh start. But in order to have debts completely discharged under bankruptcy, a client has to have zero disposable income. In 2005, a major update to the bankruptcy code made this process more challenging. Courts now use a means test which is a complex formula used to determine whether clients have disposable income that would allow a client to make some payments towards debts.
What do I do now?
It is important to get started on bankruptcy proceedings with a Bankruptcy Law Firm in Memphis, TNas soon as possible. Creditors don’t wait to take action when people stop paying their bills. You shouldn’t wait to take action to protect your future self. By starting the process, you ensure that creditors can no longer garnish your wages or foreclosure on your property.
Contact Darrell Castle & Associates, PLLC for their insight into bankruptcy and how to stop creditors.