Discharging Credit Card Debt in Bankruptcy

Discharging Credit Card Debt in Bankruptcy

Are you having trouble making the minimum payments on your credit card debt?  Are you receiving calls from your creditors at home and at work?  Have you been served with a debt collection lawsuit?  Are you using one credit card to pay the payment on another credit card?  Have you started using your credit cards to pay your living expenses? If so, this may be the time to consider filing bankruptcy.

Treating the Problem Instead of the Symptoms  

It is easy to get in over your head with credit card debt.  You may have lost your job, suffered a prolong illness, lost a spouse, or simply mismanaged your credit card use.  Regardless of the reason why you cannot pay your credit card debt, filing a bankruptcy case will help you treat the problem instead of simply dealing with the symptoms of debt problems. When you do not have any income left at the end of the month to pay credit card debt after paying your living expenses, borrowing additional money, refinancing debt, or turning to a debt consolidation company will only treat the symptom of your debt problem.  The real problem is that you do not have sufficient income to pay your credit card debt. Filing bankruptcy can help.

Bankruptcy Eliminates Credit Card Debt

When you file bankruptcy, your creditors are prohibited from continuing any collection actions including filing a debt collection lawsuit.  This protection begins immediately when you file your bankruptcy case and continues throughout your bankruptcy case.

Credit card debt is unsecured debt — the creditor does not hold a lien on any of your assets. If the creditor held collateral for the debt, you would be required to pay the debt in order to keep the asset or surrender the asset in satisfaction of the debt.  Because credit card debt is unsecured debt, you can eliminate this debt through bankruptcy without paying any of the money back to the credit card company or only paying pennies on the dollar.

In a Chapter 7 bankruptcy case, credit card debt is discharged or eliminated at the end of your case. You are not required to repay any portion of your credit card debt in a typical Chapter 7 bankruptcy case. In a Chapter 13 bankruptcy case, you may be required to pay a portion of the credit card debt back.  The amount you will be required to pay toward your credit card debt will depend on many factors including your income, expenses, assets, and debts.  In many cases, you only pay a small percentage of the credit card debt spread out over a 5-year bankruptcy plan.  When you complete your bankruptcy plan, the remaining credit card debt is discharged.  You no longer owe any of the remaining credit card debt.

Your bankruptcy discharge prevents your creditors from attempting to collect any portion of the discharged debt.  If a creditor violates the discharge order, it may be subject to sanctions by the bankruptcy court.

Contact an Experienced Elkin, North Carolina Bankruptcy Attorney

I have been helping consumers in Wilkes, Surry, Yadkin, and Alleghany Counties file for bankruptcy for nearly 15 years.  Helping relieve the financial burden debt brings is my life’s work.  If you are ready to help yourself and your family build a better life, give me a call.

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