Chapter 7 for $100,000 Credit Card Debt or Chapter 13 Bankruptcy?

It is not uncommon for the average Georgia resident to have over $5,000 in credit card debt. For some Georgia residents, this may be the credit card debt for one card, even the smallest credit card balance. For a variety of reasons including personal, medical expenses and business expenses, it is not uncommon to see a Georgia bankruptcy lawyer to see a prospect with $20,000, $30,000, even $50,000 in credit card debt or more.

Question: Does a person with $100,000 in credit card debt benefit more from Chapter 7 or Chapter 13 bankruptcy?

Answer: Depends. More information is needed to fully answer this question. It really depends on a person’s income, relative to their other assets and debts. There are some that could repay $100,000 in credit card debt over time, but these examples are more rare than frequent. A Chapter 7 or “straight bankruptcy” can be a good option for a person with limited assets and limited means of repaying. In these cases it might be easier to “walk away” because you don’t have alot to lose and cannot repay the debt even over the course of a few years. If you have 3-5 years to repay the debt, then working with a bankruptcy lawyer on a “repayment plan,” which is formally known as a Chapter 13 might be a good option. For those that have a higher means and want to protect certain assets such as a home, Chapter 13 can be a plan worth researching in more detail.

This example is not uncommon, but is higher than the average person filing for bankruptcy in Georgia. Many people file for bankruptcy with far less credit card debt than the example of a person with $100,000 worth of credit card debt. People typically have other debts other than credit card debt that result in them pursuing a potential bankruptcy filing. Depending on your income level and ability to repay, $50,000, even $25,000 worth of debt may be enough to consider either Chapter 7 bankruptcy or a Chapter 13 repayment plan.

Contact Berry & Associates for Free and Learn about Credit Card Debt Bankruptcy Options:

Think your credit card debt is high enough for a potential bankruptcy? As you learned in this entry you don’t need $100,000 in credit card debt to benefit from bankruptcy protection in Georgia. To explore what options exist and what is the right option for your situation, contact Berry & Associates. Wither 10 metro Atlanta bankruptcy offices available, we have experience lawyers at a local office near you.

Filed under: Bankruptcy Information — Tags: , , , — admin @ 7:46 am

Is $50,000 Credit Card Debt Enough for Bankruptcy?

Overcoming credit card debt can be a difficult task. Depending on your income and other debts, you may find that bankruptcy is a good option. How much is enough? At what point is it worth filing for Chapter 7 or Chapter 13?

Question: Is $50,000 Credit Card Debt Enough for Bankruptcy?

Answer: Perhaps. It depends on your ability to pay back the credit card(s). If you are able to repay back the $50,000 credit card debt over the course of a few years, then a personal bankruptcy might be avoidable. It will be tough work, but paying back your credit card without bankruptcy has other benefits to your overall financial health. In the event you cannot pay back the $50,000 in full, then there are other options available that you may want to discuss with your Georgia bankruptcy lawyer.

  • Chapter 7 bankruptcy: A Georgia Chapter 7 is also known as a straight bankruptcy. If you are able to shed your debts and start anew, then this is an option worth looking at. People that consider a Chapter 7 often do not have a large number of assets that they are looking to protect, such as a house.
  • Chapter 13 bankruptcy: A Georgia Chapter 13 is a repayment plan between you and your creditors. In this solution you work together to work out a payment plan that will be completed over the course of 3-5 years. If you own a home and are trying to avoid a foreclosure, this is a good option to consider. Same applies if you have other assets of value that you want to protect.
Filed under: Bankruptcy Information — Tags: , , — admin @ 5:12 pm

I have $20,000 in Credit Card Debt, can I File for Chapter 7?

Credit card debt can be tough to rebound from, especially when the debt is a large portion of your annual income.

Question: I owe $20,000 in credit card debt. Can I file for Chapter 7 bankruptcy?

Answer: The ability to repay your credit card debt will involve several factors:

  1. Your income (weekly / monthly take home)
  2. Your total debt
  3. Your credit card minimum payment
  4. Your credit card interest rate
  5. Your other monthly expenses

Variable 1 – Your Income:
Your income is one of the biggest variables. It is alot easier for a person with a $75,000 income to repay $20,000 of credit card debt than a person with a $35,000 income.

Variable 2 – Your total debt:
In this case a $20,000 credit card debt may or may not be the big factor in determining if Chapter 7 is the best option. Other debt, including owning a home, a car and other goods. Under Georgia Chapter 7 bankruptcy you are allowed to keep just over $11,000 worth of goods, such as clothes, furniture, wedding bands and some electronics. In summary, you don’t want to have substantial valuable assets when considering if Chapter 7 is right for you. If you have assets that you are looking to protect, a Chapter 13 bankruptcy might be a better option. An Atlanta Chapter 7 bankruptcy lawyer will be able to tell you if Chapter 7 or Chapter 13 is best for you given your asset level

Variable 3 – Your credit card minimum payment:
Just keeping up with the credit card’s minimum payment can be a challenge. If the minimum payment is too high of a percentage of your monthly income, you may be in too deep. Also, if you can repay the $20,000 credit card debt over the course of 3-5 years, Chapter 7 bankruptcy might not be for you.

Variable 4 – Your credit card interest rate:
Your credit card interest rate can mean thousands of dollars over the course of repayment. You’ll want to both know what the interest rate is and how it is calculated. You might be able to negotiate a lower interest rate, thus avoiding a potential bankruptcy or transfer part or all of the debt to another credit card under more favorable terms. Credit cards are typically the highest interest rate a person has.

Variable 5 – Your other monthly expenses:
If your other monthly expenses are high, paying back the $20,000 credit card debt may not be possible. Your bankruptcy lawyer will discuss these other expenses with you and help frame how you can benefit from seeking bankruptcy protection.

With 20 years of experience and over 25,000 cases assisted, Berry & Associates is one of the most experienced group of Atlanta bankruptcy lawyers. Call us, or search the site to find a bankruptcy lawyer.

Filed under: Bankruptcy Information — Tags: , , , , , , — admin @ 9:30 pm

Average 2011 College Graduate Debt is $22,900

The graduating class of 2011 will set a record for having the highest amount of debt upon graduation. That is not the way that many students want to start off their career, but one that many believe is necessary to give them the opportunities in life that they want from their careers. The Wall Street Journal reported about the class of 2011 in May:

Together with loans parents take on to finance their children’s college educations — loans that the students often pay themselves – the estimate comes to about $22,900. That’s 8% more than last year and, in inflation-adjusted terms, 47% more than a decade ago.

Is the level of debt still worth it? Probably, but the amount of time it will take to get free from this debt is going to take years. In Georgia, which experiences a high quality of living, average starting salaries can be lower for recent graduates than in other parts of the country. Starting with $20k of debt can be difficult for a person that is making just over $30k per year in a city such as Atlanta.

While the unemployment rate is much lower for college graduates, so too is the typically the level of debt that they owe. For those that are a college graduate, but are unemployed the risk of bankruptcy can be too real (see college graduates bankruptcy). Mounting credit card debts and the pressure to keep up with car payments and student loans can eat away almost all of a 20-something’s income. Maintaining payments of these debts is obviously more challenging when that person is not employed.

Bankruptcy is an option to free yourself from debt, but it is not an option for everyone. If you have questions about a Georgia Chapter 7 or Georgia Chapter 13 personal bankrputcy, the Atlanta bankrputcy attorneys of Berry & Associates can help.

Filed under: Bankruptcy Information — Tags: , , , — admin @ 7:40 am

Is Georgia Experiencing a Double Dip Recession

Douglas A. McIntyre recently published a 24/7 Wall St. article on MSNBC that illustrated 10 signs that the economy was already in a double dip recession. The thought that the economy may be getting worse will be scary to many, but not news to others. In many ways the economy has never fully rebounded to pre-2007 levels. For example, unemployment is at 9.2 percent, housing prices remain around 2002 levels and consumer confidence at an all-time low.

Many of the below signs you might already be observing. For example that cup of coffee is costing more due to inflation, including increased oil prices, which is pushing the average consumer’s budget further and preventing them from having the purchasing power they once had. For those looking to pay off debt, investments are not yielding as much as in the past. Of course the 900 lb gorilla in the room is the fact that housing declines has resulted in millions of homes have negative equity.

10 Signs the Double-Dip Recession has Begun

  1. Inflation
  2. Investments have begun to yield less
  3. The auto industry
  4. Oil prices
  5. The federal budget
  6. China economy slows
  7. Unemployment 
  8. Debt ceiling
  9. Access to credit
  10. Housing

What about Georgia? In some ways Georgia is positioned to do better in the recession than a rust-belt state like Michigan. Labor laws and a lower cost of living have allowed Georgia to flurish during boom times, such as the period before the 1996 Olympics into the early 2000s. When certain industries slow down, such as new home construction, Georgia is hit hard because it has been known as a state with positive population growth. This positive population growth requires more resources, such as new homes and services from local businesses. When consumer buying power slows, or if the rate in which people are moving to Georgia slows, so too can the rate of growth of certain industries.

It will be interesting to see how Georgia is affected in the coming months. The data is mixed. This bankruptcy blog has been following the Georgia economic outlook for a long time. It both shows that some industries are rebounding and the worst appears behind us. Other reports are showing that a double dip is a real thing. For the thousands of Georgia residents looking for solutions, the recession can’t be over soon enough.

If you are looking at debt law options, consider contacting Berry & Associates. Our Georgia bankruptcy lawyers can help evaluate you situation and help advise you on potential options.

Read the MSNBC Article: 10 Signs the Double Dip Recession has Begun

Filed under: Economic News — Tags: , , — admin @ 7:12 am

High Medical Debts are Forcing Me Into Bankruptcy

Each month millions of Georgia residents look at their bills with a sense of anxiety. For many they will see bills such as car loans, credit card payments and housing, including a mortgage or rent payment that is due. Of course there are other types of debts such as student loans, retail storing financing, among others. For thousands of Georgia residents, the previous items are all small compared to high medical debts that they owe. For these residents, the thought a medical debt bankruptcy is very real.

Overcoming High Medical Debts:

It is not easy to overcome high medical debts. Often these debts can go into the tens-of-thousands, if not hundreds-of-thousands. When a medical debt reaches this level, it is often the largest debt that a person has. Very often these debts can have higher obligations than even a person’s home, which traditionally has been known as a person’s largest asset.

A 2007 survey cited that 78% of those filing for bankruptcy filed partly due to illness or the among of debt that resulted because of an illness. This makes medical debts one of the most common reasons people file for bankruptcy. For a person that has survived cancer treatment or another long and costly medical battle, the victory of feeling better physically is often replaced with depression of how the resulting medical expenses will be paid.

Medical Debts and Bankruptcy Lawyers:

Speaking to a bankruptcy lawyer is a good option for a person with high medical debts. When you speak to him, make sure to include your medical expenses. Since these expenses can be so high, it is a critical part of the basic information that you bankruptcy lawyer needs to know. He’ll also need to know what types of secured debt and unsecured debt that you have. Your current income will also be a variable in potential options. If bankruptcy options are available, he’ll let you know. He’ll be able to explain why he is recommending a Chapter 7 or Chapter 13 bankruptcy.

If you are facing high medical debts, consider contacting the lawyers at Berry & Associates. We’ve helped over 20,000 Georgia residents with bankruptcy. We understand how the law can be used for medical expenses in a Georgia bankruptcy filing.

Filed under: Bankruptcy Information — Tags: , , — admin @ 7:57 am

Be Watchful of New Credit Before You File Bankruptcy

Be careful in what you new credit consist of up to 90 days before you file for bankruptcy. If you incurred new credit of $500 or more for “luxury goods or services” within the 90-day wind before your bankruptcy, or if you obtain a cash advance in the amount of $750 within 70-day period before your bankruptcy, the debt will likely not be able to be dischargeable.

In other words, if you are considering filing for bankruptcy, now is not the time to go on a shopping spree or make personal upgrades to your home or self. Your creditors will see the statements of these new debts and the law will not allow for these to be included in your case and you’ll still have to pay these debits.

Taking out a cash advances either of $750 or more at once or the total of multiple cash advances will likely also not be included in your case. Obtaining any new debt unless absolutely required within the 90-day window is something that many Georgia bankruptcy attorneys advice their clients against.

Have a question about new credit can affect your bankruptcy filing? Click to contact us. Berry & Associates helps Georgia residents file for personal bankruptcy, including Chapter 7 and Chapter 13. They offer 11 metro Atlanta bankruptcy law offices with lawyers on staff Monday – Saturday.

Filed under: Bankruptcy Information — Tags: , , — admin @ 7:05 am

Rebuilding Your Credit with 100 Words post-Bankruptcy

For those that are either preparing to go through personal bankruptcy or have recently gone through a Chapter 7 or Chapter 13, the topic of credit reports is not one that people like thinking about. Looking at credit scores and credit reporting makes many consumers nervous as is, without factoring in how much more stressful it can be for those that have recently sought or obtained bankruptcy protection.

Your credit score and credit history are essential components into getting approved for credit and what interest rate you’ll pay if approved. If you are planning a large purpose or looking to apply for a new job, then you already know that your credit report is something that is important. While you think hope might be lost, there are 100 words that can help you get on the path of rebuilding your credit.

AOL Money & Finance came out with a helpful article, 100 Words That Can Change Your Credit History. In this article a little known fact is discussed. All three credit-reporting agencies are required to allow consumer to attach a 100 word statement to their credit reports.

If something is inaccurate in your credit report that is taking a long time to clear up, this 100 word statement can be helpful. This statement can also be useful if you are looking to reassure a lender, creditor or other person that is reading your credit report. While this won’t impact the actual credit score, in terms of its numerical value, it can be a useful piece of qualitative documentation, especially if a manual review of your credit report is occurring.

Important to Know about 100 Word Credit Reporting Statement:

  • You need to manually submit it to each of the credit reporting agencies (Equifax, Experian and TransUnion)
  • The statement will stay on file as long as you leave it there
  • 3-4 sentences are recommended
  • Excellent topics can include: identify theft, medical emergency, or an error with a business that is taking a long time to clear up
  • Be specific and avoid emotion
  • Be accountable for your actions and be sincere without making excuses
  • Proofread — this statement is only 100 words so the grammar and spelling should be perfect.
  • Chapter 13 Georgia filers should consider revising the 100-word statement once they receive a full plan discharge

While a 100 word statement in your credit report won’t help improve your score, it can help shed some light on what has happened in your financial past. Things happen in life, good and bad. The 100 word statement is an opportunity to take something that is bad and try to explain it so it is a minimally harmful as possible. As you go through the filing and rebuilding process your bankruptcy lawyer will be helpful in sharing methods to rebuild your credit.

Filed under: Bankruptcy Information — Tags: , — admin @ 8:31 am

5 Ways to Save The Most Money with Bankruptcy

You stand to save a lot of money by filing bankruptcy – and not just money on debts. For example, if you’ve invested thousands if not tens of thousands into your home, you want to protect this investment. This guide explains 5 unique ways to save the most money with bankruptcy.

Get the Right Lawyer
Few of us can handle a bankruptcy by ourselves. Even if you are a lawyer, it takes time and skill to handle paperwork, creditors, and court room decisions. A Georgia bankruptcy lawyer saves you money, protects your assets, and ensures your future success.

Know Your Options
You have options beyond bankruptcy too. There are advantages to filing, especially with the legal protection you get. But you don’t always want to file bankruptcy.  Say, for example, you are getting called daily on a $5,000 medical bill, you are working, but you cannot pay the amount in the time they want. Since you have a job, and the bill is relatively small, you may want to consider other options, such as negotiating a payment plan. On the other hand, if you get a $50,000 medical bill, employed or not, it may be wise to save yourself that money and file bankruptcy. What form of bankruptcy?

Why Chapter 7 Bankruptcy?
The #1 cause of filing Chapter 7 bankruptcy is medical debt. The second biggest culprit for Chapter 7 is credit card debt. You stand to save thousands if not tens of thousands here. As a general rule, if you have debts you cannot pay off reasonably in a 3-5 year time frame, consider bankruptcy. There is no limit on how much you can save. Sometimes, however, you have a high income, and valuable assets you cannot lose.

Why Chapter 13?
If you make too much money, you may not be eligible for Chapter 7 bankruptcy. And if you want to avoid losing a lot of assets and properties, Chapter 7 may not be the best choice. In this situation, you can save more money – and money includes assets – by protecting these with a  Chapter 13 bankruptcy. This is a repayment plan over a 3-5 year period, in manageable installments, with the opportunity to protect all your assets including your home and car.

What Debts Can You Lose?
While some debts cannot be discharged – such as child support and taxes – most debts can be part of a Chapter 7 or Chapter 13 discharge. And if you have assets you want to keep, but want to file Chapter 7, you can negotiate outside the bankruptcy. This almost always requires a skilled Georgia bankruptcy lawyer.

Change
If you truly want to save the most money, don’t get into this situation again. You can only file bankruptcy so often. Change the way you spend and invest money. Change the way you look at growing debts. Pay bills on time, stay within your income, get medical benefits, and save money in case of future problems.

Filed under: Bankruptcy Information — Tags: , , , , , , , , , , — jmalewitz @ 12:44 pm

Cleaning up Your Credit Report in Georgia

What exactly is a credit report, why should you care, and how do you get one?

A credit report is a document compiled by credit bureaus which shows past financial history. This becomes important if you’ve filed bankruptcy in the past, want a new mortgage, or want to make a large purchase and need a loan.

The three major credit bureaus where you can get credit reports online are Equifax.com, Experian.com, and Transunion.com.

Credit bureaus mainly get data about you from creditors. You can also expect court records to be searched for lawsuits, judgments, and bankruptcies. There is also other information in a credit report, including things like your social security number, employment history, past and present addresses, current and former names, and more specifically you banking history (opened and closed accounts, amount of loans given, current balance, etc.).

For Georgia residents, the best way to clean up your credit report involves working with some credit agencies, being smart in the future with loans you take, and hiring professional counsel who can help you in case you see potential problems in the future.  You can actually get all your credit reports for free if you contact annualcreditreport.com to get them; this is important because you need these in order to improve credit.

In some cases, you can ask for more than one credit report. If you are unemployed and looking for work, for example, you’re entitled to an additional copy. If not, you can pay a small fee to get your additional credit report.

Clean Up Errors in Your Credit Report
Go through your credit report and look for inconsistencies and problems you see immediately. Out-of-date and incorrect information are often the most obvious. For out-of-date info, you can actually get them taken off your credit report, and the same is the case with incorrect information. We’ll go over that more soon.

Out-of-date info on your credit report includes:
-Negative info that’s more than 7 years old, such as lawsuits and criminal records
-Bankruptcies reported more than 10 years after you were discharged

Incorrect information on your credit report may include:
-Wrong names, numbers, social security numbers, employment info or other personal information
-Bankruptcies which don’t state what form of bankruptcy (Chapter 7 or Chapter 13 bankruptcy usually)
-Bank accounts which are not yours, or lawsuits you had nothing to do with
-Incorrect late payment records
-Any account you closed that doesn’t say it was “closed by consumer”

Clean Up Credit Report
There are many way to clean up your credit report, but what can be difficult is removing incorrect information, if not recognizing it immediately. You can request removal of incorrect information, which is simple. Sometimes the credit bureau won’t agree with that, and you can appeal. In most cases, the incorrect info can be removed from your report by filing documents the credit bureau gives you.

Rebuilding Your Credit in Georgia
After you’ve cleaned up the report, and corrected mistakes, it’s time to get work on improving your credit score. It may take a few years, but once you start regularly paying bills on time, get a credit card and pay it on time, you can have more opportunities. If you’re goal is, for example, to buy a home, it may take 4-5 years before your credit score allows you to get a home and mortgage.

Filed under: Bankruptcy Information — Tags: , , , , , , , , , , , — jmalewitz @ 2:00 pm


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