| When should someone declare bankruptcy? What | | | | adhere to a repayment plan and in some cases |
| type of bankruptcy am I eligible for? These are | | | | reduction in debt. |
| very common questions. Unfortunately, there | | | | This is done for individuals who have, after |
| often are no direct answer as "it all depends." For | | | | consideration, enough disposable income to pay |
| some, individuals, a BK may be the only option to | | | | off a portion if not all of the debt in a reasonable |
| be able to get out from under overwhelming debt. | | | | amount of time without causing an issue with |
| In some cases, it may be the only way to save | | | | their home, transportation or other necessary |
| your home, your car and other assets. New | | | | expenses. It is important to remember that the |
| legislation has made it more difficult to obtain a full | | | | expenses that are deducted from your incoming |
| bankruptcy where all debt is eliminated with no | | | | cash flow are determined by governmental |
| effects other than a negative reporting on your | | | | guidelines and are determined in part by family |
| credit report. In fact the new regulations stipulate | | | | size. Even if you are filing for chapter 7 |
| the types and kinds of debt, which can be | | | | bankruptcy you may not with these guideline |
| discharged, and in some cases the reasons. | | | | actually qualify. |
| There some things, which are not considered to | | | | There are recourses if your actual expenses are |
| be bankruptcy debt, these are usually federally | | | | indeed more than the allowable by government |
| issued or managed loans such as student loans. | | | | guidelines however these require additional time |
| These are not cleared under bankruptcy laws and | | | | and may require additional costs when it comes |
| cannot be applied for when applying to have debt | | | | to court fees, legal fees and rising debt. How you |
| liquidated under chapter 7 or placed on a | | | | handle credit and budgeting after bankruptcy is |
| repayment plan such as available through chapter | | | | important. The number of times you can file is |
| 13. The new requirements for both chapter 7 and | | | | limited and in many cases one time is all that is |
| chapter 13 bankruptcy filings make it more | | | | allowable. Repairing your credit after either a |
| difficult to obtain a chapter 7 which is total | | | | chapter 13 or chapter 7 bankruptcies can be |
| liquidation of debt and it makes it harder for | | | | difficult. |
| bankruptcy attorneys to file for clients. This in | | | | This is why bankruptcy credit card options exist. |
| turn makes it more expensive and a much | | | | They are designed to provide you with the ability |
| lengthier process to file for bankruptcy now than | | | | to be able to help repair your credit after you |
| in previous years. | | | | have filed bankruptcy and discharged your |
| In order to be eligible to file chapter 7 bankruptcy | | | | bankruptcy debt. There are a few earmarks of |
| you must meet a certain set of guidelines. These | | | | the type of credit card that can be classified as a |
| guidelines are that you attend credit counseling as | | | | bankruptcy credit card. |
| well as personal finance and budgeting classes. | | | | One of the biggest is that it is a secured card. |
| These have to be from a registered provider and | | | | This means that your credit limit on the card is |
| there must be documentation that you attended | | | | limited to the amount of money you place on the |
| and made yourself available to the services they | | | | card. If you place $50 on the card then your |
| provide. It is also necessary that you meet | | | | credit limit is $50. Every time however you pay |
| income guidelines. This means that after allowable | | | | that back to the card and renew the total |
| expenses are removed you do not have enough | | | | amount a positive report is sent to the credit |
| disposable income to make payments on a | | | | reporting agencies indicating that you paid the |
| repayment plan. The key word in this is allowable. | | | | card. This in turn improves your credit rating in |
| The government has set regulations on expenses. | | | | regards to revolving credit. Revolving credit is |
| These regulations allow only so much of each | | | | characterized by having a renewable source of |
| type of expense to be deducted and it stipulates | | | | credit such as a credit card or line of credit style |
| the types of expenses, which are allowable. | | | | loan. |
| Chapter 7, which is total liquidation of debt, is | | | | Other things, which may characterize the type of |
| much harder to qualify for and obtain than a | | | | credit card available, as a bankruptcy credit card |
| chapter 13. After you have obtained credit | | | | is a credit card with a low balance and high |
| counseling and it has been documented that you | | | | interest rate that you are allowed to keep regular |
| do not have the income necessary to pay off | | | | payments of this card have the same effect as a |
| your debt. There are a few things that occur. You | | | | secured credit card. It is important with these |
| must present your case in court where creditors | | | | cards is that you purchase no more than you can |
| often send representatives to argue for a | | | | afford to pay off by the time the bill is due. This |
| dismissal of a chapter 7 or to remove their debt | | | | creates an even greater impact because you are |
| from the list of accepted debts that were to be | | | | paying the debt off in full at the turn of each |
| liquidated. It is possible for some bankruptcy debt | | | | billing cycle. |
| to be presented and not be ultimately included in | | | | Filing for bankruptcy may be a way to release |
| the decision of the court regarding your | | | | you from overwhelming debt legally but it is not a |
| bankruptcy. | | | | decision to be made lightly and should be used as |
| Chapter 13 bankruptcy is based on a repayment | | | | a final resort. It remains one of the biggest |
| plan. This plan is usually set up by the credit | | | | marks, which can negatively affect credit scores |
| counseling service and courses that you are | | | | and ratings. The new legislation also makes it |
| required to take when filing any form of | | | | difficult to obtain a full liquidation leaving you not |
| bankruptcy. This is the type of bankruptcy, which | | | | only with the debt to repay but also with the |
| does not remove debt but requires creditors to | | | | negative effects of a bankruptcy. |