WHEN debts spiral out of control, bankruptcy can become an invaluable financial recovery tool in stemming the tide and getting you back on the right track. Without the “fresh start” that bankruptcy provides, it would be impossible for a lot of people to ever pay back what they owe and they will simply remain stuck in debt with nowhere to go. If you’ve tried everything you can to pay your debts but nothing has worked up to this point, it may be time to consider legal options.
A financial crisis can happen to anyone at any time. No one is exempt. Bankruptcy is a fact of life. Without it, people with serious debt problems will remain stuck where they are, unable to move on with their lives. Living with stress every day caused by the burden of debt is a horrible way to live. Bankruptcy can offer hope when the future looks bleak.
Some people will qualify for Chapter 7 to completely wipe out their debts. Others may have no choice but to file Chapter 13 and pay their creditors over a 3-5 year period. Much of it depends on your income and your assets. You also need to take into consideration your objective in seeking debt relief.
Under the rules for Chapter 7 bankruptcy eligibility, your current monthly income must be measured against the median monthly income for a family of your size in your state. If your average monthly income is lower than the median, Chapter 7 may be for you. If your income is higher than the median, Chapter 7 is still a possibility, but there is an additional step. You have to pass what’s known as “the means test”, a mathematical formula for calculating your disposable income and determining whether it is high enough to help pay off some of your debts.
Chapter 13 can be the most effective way to consolidate all your debts into one low monthly payment that you can afford. In a lot of cases, most debts are only paid a small percentage of the actual amount, resulting in significant reduction- a reduction of 50% or more is not unusual. Just imagine what this will do for you if you can cut your debt payments every month by more than half!
Instead of hopelessly trying to pay your debts and not making progress, you may be better off just filing bankruptcy now to start fresh and rebuild your credit sooner than later. If you need help in getting out of debt, I would like to help you. Please call Toll-Free 1-866-477-7772 to schedule a free consultation. We have offices in Pasadena, Valencia and Cerritos.
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None of the information herein is intended to give legal advice for any specific situation. Atty. Ray Bulaon has successfully helped thousands of clients in getting out of debt. For a free attorney evaluation of your situation, please call Ray Bulaon Law Offices at TOLL FREE 1 (866) 477-7772.
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