Your Credit Will Be Ruined
Your credit will not be ruined. Bankruptcy is a very common financial action. For Chapter 7 bankruptcy, yes, you are voiding many of your debts. Understandably this will affect your credit. A Chapter 7 filing shows up on your credit for 10 years. However, this does not ruin your credit. Georgia Debt Law goes over many ways you can rebuild your credit by taking some simple steps.

Everyone Will Know
You may be in some ways ashamed at having to file for bankruptcy, maybe even for Chapter 7. And then you may fear that everyone else will know. First, bankruptcy is filed by over 1 million individuals every year. That’s a lot of people. Second, you can only find out about a bankruptcy by going through court records. So yes, some credit companies, if they look, will know you filed bankruptcy. But not everyone will know you filed.

You’ll Lose Your Home
There is some basis for fact in this fear. The general point of filing Chapter 7 bankruptcy is to discharge debt; you have less protection for assets than you might have in a Chapter 13. Still, few lose anything when they file bankruptcy, especially their homes. If you plan it correctly, you can keep your home. If you are in danger of losing it, you have legal rights. You can’t just be thrown out of your home a day after filing bankruptcy. If you cannot pay on it, the automatic stay will protect you for several months from foreclosure and utility shutoff. If you can pay on it in some way, you can keep it.

New Bankruptcy Code Makes it Impossible to File
Yes, the changes to bankruptcy code in 2005 make it harder for some to file, mainly Chapter 7. The new code does not make it impossible for individuals or families to file. If you make more than the Georgia median income, which is 40,456 for one individual and goes up after that for couples and families, you are not eligible. Most are then eligible for Chapter 13.

Lawyers Will Take All Your Money
The idea that lawyers are inherently greedy is a common myth. Of course, not everyone believes it, but it has some reasons. Lawyers are not cheap. In bankruptcy, you are not being defended for a criminal act. You have debt. It’s important, but not a life and death situation. Therefore, lawyers charge some of the lowest legal rates in bankruptcy cases, even some very good ones. You are not filing because you have tens of thousands of dollars. A lawyer can charge you from $1,000 to $2,000 for a successful Chapter 7 bankruptcy discharge.

If you have some questions, contact an experienced Georgia lawyer today. He or she can relieve some of your concerns too.

Hire the Right Lawyer
We go over the many reasons you need a lawyer quite often on Georgia Debt Law. Unfortunately, many forgo hiring a lawyer because of a lack of income. It’s understandable: maybe you have no job, maybe you just received a huge credit card or medical bill, and paying money to a lawyer is impossible.

However, we all have ways of getting some money. Legally, you can get loans from friends and family, sell certain exempt assets, sometimes even negotiate with the lawyer on a payment plan. A lawyer is so valuable because he or she can help you fill out all forms correctly, handle any creditor problems you may be having, help you keep your assets, and most importantly discharge the majority of your debt. It’s easy to say, “you have to hire a lawyer,” but in reality, you may not have the means. If this is the case discuss your options with some qualified lawyers. Just making the call is a big first step.

If You Have No Job
If you have no job, filing Chapter 7 bankruptcy is a no-brainer. You have no income to be taken. You can prove you cannot afford a Chapter 13 repayment plan. What happened was the Bankruptcy Code of 2005 made it more difficult to file Chapter 7 bankruptcy nationwide. If you make too much money, you may be forced to file Chapter 13 and fund a repayment plan. However, if you have no job, it’s almost a good thing. You can clearly prove you cannot pay off these debts.

If You Have No Other Income
Also, if you have no other income coming in, say from disability or through a retirement plan, you are likely eligible for Chapter 7. Even if you have some money coming in, you are quite often eligible for Chapter 7. In Georgia, it’s based on the median income. If you are above, you have to file Chapter 13. Most with no jobs and minor income are eligible.

The Best Reasons to File
Filing can stop creditor harassment, give you a financial second chance, save assets from being taken, save you tens of thousands of dollars in credit or medical debt, and all for the cost of a $299 court fee and some lawyer expenses.

Foreclosure and Georgia Chapter 7
Filing Chapter 7 in Georgia is not always your best option. If you do have some money coming in, Chapter 13 may be better. In fact, it can save your home from foreclosure. Why? If you file Chapter 13 before the foreclosure papers are filed, an “automatic stay” is put on all your debts and stops any foreclosure. You can then renegotiate.

Credit Card and Medical Debt
Before you file Georgia Chapter 7 bankruptcy, consider all your options. If you have immense credit and medical debt, you can be free of it. These are the best reasons to file. Chapter 7 bankruptcy is a solution for those struggling financially. If you have no insurance, paying off a $100,000 medical bill may be impossible. If you made some financial mistakes and are in debt for tens of thousands on your credit cards, you may be in a hole impossible to dig out of. In these instances, filing Chapter 7 bankruptcy in Georgia can give you a fresh start.

What makes it different for Georgia residents? Georgia has a high unemployment rate, especially in major cities such as Atlanta.

But there is good news, as foreclosures in Georgia are less common, according to studies made in the tough year of 2009, than many other states. Georgia had a fraction of the total foreclosures that California had, for example.

Still, even with low foreclosure rates, unemployment rates pushing over 10 percent make it a tough market. This makes personal bankruptcy more valuable. You can save your home, you can eliminate debt, and you can get a fresh start.

Personal filing comes under Chapter 7 and Chapter 13 bankruptcy. How do they help Georgia home owners? Are you eligible? Let’s find out.

Eligibility
If you make too much money to file Chapter 7 bankruptcy, it’s actually not a bad thing. Home owners typically file under Chapter 13 bankruptcy.

Why?

You can save your home from foreclosure by filing Chapter 13. Chapter 7 is very good in other respects, such as eliminating credit card debt. But if you’re a employed individual or family member, you might be over the limit for Chapter 7.

How Chapter 7 Works
Chapter 7 is a liquidation. Your trustee sells your assets to pay back debt. Your debts in many areas are cleared, such as credit cards. However, for home owners the bad news is your home may not be exempt. There is exempt and nonexempt assets. If any asset is valued too high and not exempt, you might consider personal bankruptcy under Chapter 13.

How Chapter 13 Works
For home owners who are currently working, this is the prime option. You do not eliminate any debts. You create a plan for paying back the debts over 3-5 years. If you fall behind in mortgage payments because of a  mountain of other bills, you can save your home.

Warnings On Personal Bankruptcy for Home Owners
If you are going to file under Chapter 13, do not wait too long. If you do wait until the lender forecloses, you may lose the home anyways. Technically, lenders can foreclose after you miss one payment, but that rarely happens and usually it occurs after a few missed payments. There is an entire process to this and an experienced bankruptcy attorney can help.

Hiring a Personal Bankruptcy Attorney
Filing bankruptcy is cheap in comparison to all the benefits, especially for Georgia home owners. Chapter 13 bankruptcy, for example, is only $274 (and Chapter 7 $299). You do have to pay a lawyer, but if you hire the right one, it saves you time and money.

As noted in this blog post on Georgia Debt Law, if you’re facing foreclosure then  bankruptcy is often your best option. At a minimum, you have extra time to find a second residence. At best, it buys you time to save your home.

Just what bankruptcy should you file and how does it work?  First, let’s go over exactly what a foreclosure is.

Georgia Foreclosure
You fall behind on your mortgage payments, and the lender isn’t working with you on a payment plan. Maybe you have too many other bills, such as medical fees or car payments, or maybe you lost your job or someone close to you passed away. No matter the reason, the lender can take steps to bring foreclosure on your home, selling it at an auction and paying back your debt through the sale.

There are many alternatives to filing bankruptcy, but in terms of foreclosure, if you’re behind on payments sometimes there is little else you can do. If the lender is unwilling to negotiate, if you have bad credit, or if you have no other place to go if you lose this home, bankruptcy is almost a must.

Georgia Bankruptcy
Filing bankruptcy in Georgia usually calls for Chapter 7 or Chapter 13 bankruptcy. The good news with Chapter 7 bankruptcy is that it buys you extra time to find another residence (if you have few other places to go). This can be several months if not longer, as by law the courts can protect you.

How? If you file Georgia bankruptcy, there is the “automatic stay” which usually gives you 3-4 extra months extra time. You will likely lose your home if you file Chapter 7 bankruptcy in Georgia, but 3 months is a lot of time to figure something out.

On the other hand, you may want to fight this to the end. The best option if you want to keep your home–if you want to fight for it–is to file Chapter 13 bankruptcy in Georgia.

Advantages of Chapter 13 Bankruptcy in Georgia
Chapter 13 bankruptcy can save your home. You will need enough income to meet your current mortgage payment, so do what you can to get that. After, you will set up a repayment plan over a few years time–usually 3-5 years. This means you’ll pay back the debt over a longer period. It  does call for bringing in more money, but Chapter 13 bankruptcy is the foreclosure solution.

Hiring a Georgia Bankruptcy Lawyer
Your best choice is to discuss this with a Georgia bankruptcy lawyer. Did you know, for example, you may be able to cancel your 2nd and 3rd mortgages? It’s not a dream, with the right assistance you can. And people successfully file for bankruptcy in Georgia to stop or delay foreclosures. All you  need now is to choose a lawyer who can help.

According to the article, “City officials and housing advocates here and in cities as varied as Buffalo, Kansas City, Mo., and Jacksonville, Fla., say they are seeing an unsettling development: Banks are quietly declining to take possession of properties at the end of the foreclosure process, most often because the cost of the ordeal — from legal fees to maintenance — exceeds the diminishing value of the real estate.”

The new development in the foreclosure crisis emphasizes that if you are facing financial problems, you should do everything possible to keep in touch with your creditors and attempt to negotiate a solution to your problems.

After being served with foreclosure notice, the homeowner files with the court seeking proof of the lien by asking that the lender produce the original mortgage paperwork.

Since the paperwork is often stored in dedicated facilities, it may take weeks or even months to find the documentation delaying the foreclosure. Sometimes, mortgage lenders have been unable to produce the documentation of the loan and the foreclosure is stopped by the courts.

Since the foreclosure process in Georgia is much quicker than in some parts of the country, it requires that homeowners be on top of their situation. Knowing you have missed a couple of mortgage payments, you need to be on the lookout for a notice in your local paper and anything that may be sent to you in the mail regarding a foreclosure.

If your financial situation has deteriorated to the point that you are struggling to make your housepayment, you should talk to a Georgia bankruptcy attorney about your options.