Debt consolidation ? Options for Reducing Your Debt
Studies show that Americans are now saving less than ever before. Along with that, Americans are carrying a heavier debt load than ever. It's easy for a home loan, a car loan and a few credit card bills to get out of hand, and many people are struggling with more debt than they can easily pay. To make matters worse, new bankruptcy legislation will make it harder than ever to file bankruptcy for those who simply cannot pay their bills. There are a number of solutions available that allow most people to reduce their interest rate on their debt, reduce their total monthly payment, or both:
If you have been making payments regularly, and you haven't had a history of late payment, you may be able to lower your interest rate on your credit cards simply by calling your credit card company and asking them! It doesn't always work, but the market for credit cards is pretty competitive these days, and many lenders would rather lower your interest rate than lose you as a customer. It's worth asking.
You can probably obtain a simple installment loan from your bank by putting up cash or investments as collateral for the loan. Like credit cards, the interest isn't tax deductible, but the interest rate may be better than credit cards, and if you consolidate several payments into one with a bank loan, you will lower your monthly payment.
As a bonus, the interest is tax deductible. A minor downside is the fact that these loans usually have application fees and/or closing costs.
There Are Two Types Of Personal Bankruptcy, What Are They?
There are two different types of personal bankruptcy that an individual can file, Chapter 7 & Chapter 13.
Chapter 7 allows you to disburse of most or all of your debts at the time of the court ruling. This method, however, has more of a negative impact on your credit rating and will stay with you longer?up to ten years. People who file Chapter 7 personal bankruptcy are considered to be a much more credit risk then those who file Chapter 13 personal bankruptcy.
In a Chapter 13 personal bankruptcy filing you pay off your debts in what is known as reorganization.
Through the courts, a court-appointed trustee will determine your new standard of living and how much of your income will be given to you to live on and will divide the rest among your creditors each month. For the next three to five years, you will have to live on a strict budget while your debts are getting paid. At the end of the reorganization your debts are considered paid in full, however, the record...
There Are Two Types Of Personal Bankruptcy, What Are They?
Bankruptcy > There Are Two Types Of Personal Bankruptcy, What Are They?
Low Cost Bankruptcy Filings
By and large, one would notice that when someone files for Chapter 7 bankruptcy they would make a payment of about $450 in attorney fees, where people who file Chapter 13 have to pay more. These cases are in general more costly, the attorney's fee begins at $750 for representation through completion of the plan.
These amounts represent attorney fees only and people are still responsible for paying filing fees and other expenses. People should also be aware that any complications in the case will raise the attorney fees rather quickly.
People could alternatively choose form preparation services instead of legal representation.
A few debtors have a preference to do this and only be in attendance through hearings alone. Other alternatives include using a number of software programs that are now available. Pricewise, these programs cost about the same as form preparation services.
If the debtor wants to avoid that cost, they can download...
Bankruptcy > Low Cost Bankruptcy Filings
Debt consolidation ? Options for Reducing Your Debt
Studies show that Americans are now saving less than ever before. Along with that, Americans are carrying a heavier debt load than ever. It's easy for a home loan, a car loan and a few credit card bills to get out of hand, and many people are struggling with more debt than they can easily pay. To make matters worse, new bankruptcy legislation will make it harder than ever to file bankruptcy for those who simply cannot pay their bills. There are a number of solutions available that allow most people to reduce their interest rate on their debt, reduce their total monthly payment, or both:
If you have been making payments regularly, and you haven't had a history of late payment, you may be able to lower your interest rate on your credit cards simply by calling your credit card company and asking them! It doesn't always work, but the market for credit cards is pretty competitive these days, and many lenders would rather lower your interest...
Bankruptcy > Debt consolidation ? Options for Reducing Your Debt
Chapter 7 Bankruptcy
When you file Chapter 7 bankruptcy (liquidation bankruptcy), your first step is to contact a bankruptcy lawyer to get you through the process. Your attorney will prepare and file documents to the US Bankruptcy Court clerk. The forms will contain your complete financial information, your income, expenses, property and debt.Next you will meet with the court appointed trustee at which time your creditors will be notified and they can no longer contact you to attempt to collect any debt you may owe. The trustee will take your non-exempt assets and sell them to pay the trustee's fees, administrative expenses and your creditors.Once you have complied with all the courts requests, than an order will be filed discharging you from your debt..
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