what is bankruptcy, how does it work, how does it affect your credit, and what does it do?
In: 37
I’m a bankruptcy lawyer in Pennsylvania and have been for 25 years. A bankruptcy can stop a foreclosure or allow you to pay back taxes. It can wipe out all your unsecured debt. It can reduce the total you have to pay on a car loan. It can wipe out some back taxes. It can stop lawsuits. It can get you back a car that has been repossessed. There are two kinds for consumers that are most popular: 7 and 13. You get to keep property that is exempt and for most people ALL their property is exempt. Each state decides if it wants to use the federal exemptions or their own or both. Most clients see their credit bounce back after about 24 months. If you would otherwise qualify for a mortgage most people can get a mortgage two years after a bankruptcy. A chapter 7 can be filed once every 8 years. A chapter 13 once every two years. When deciding whether bankruptcy is right for you you should speak with a licensed bankruptcy attorney in your state. If your income is over a certain threshold you may need to pay back a portion of your debt in a chapter 13. If you do have assets that are not exempt you can pay the trustee what they would get if they sold your stuff in a chapter 13. You have five years to pay. Three most common reasons for bankruptcy: divorce; job loss; illness. Another common reason: low wages. You cannot budget your way out of poverty.
Latest Answers