Credit Card Debt and Bankruptcy: When to Start Over

If you are facing serious credit card debt, and you are having a hard time trying to dig your way out then you may want to consider filing for credit card debt bankruptcy. Depending on your circumstances, you will either file under a Chapter 7 or a Chapter 13 Bankruptcy as these two bankruptcies are the most common filed by individuals seeking to manage their debt.

Understanding Credit Card Debt Bankruptcy

There are certain things that you should know prior to filing for bankruptcy. You should think about the total amount of credit card debt that you are facing. Be sure that prior to filing for bankruptcy you have tried to resolve your credit card debt as best as possible. Bankruptcy should only be a last resort because it will stay on your credit report for ten years. For example, consider

Should I go with a debt clean-up company?

As relative to the debt that you are facing, you may want to consider a debt clean-up company as one of your options. There are some debt clean-up companies that will actually help you consolidate your debt into something more affordable. They will also teach you how to better manage your finances. It is important that you try to mend or alleviate your credit card debt prior to filing for bankruptcy. If you feel that you have indeed found a reputable debt clean-up company then it could be an option.

What can bankruptcy do for me?

If you are eligible for Chapter 7 bankruptcy, then your non-exempt assets will be sold and at the end of the sale, any remaining credit card debt is forgiven and you start with a clean slate. However, if you aren't eligible for chapter 7, then you need to understand that chapter 13 won't wipe out your debt. It will just restructure it, so you will still have to pay at least some of the debt off over a period of 3-5 years.

Get Help

One of the things that you may want to consider as you mull through your credit card debt situation is retaining a bankruptcy attorney. If you retain a bankruptcy attorney you will avoid having to deal with your creditors trying to file and adversary proceeding to your bankruptcy. Sometimes when an individual attempts to discharge his credit card debt via bankruptcy the creditors will file an adversary proceeding in order to get the money that is owed. This is where a bankruptcy attorney comes into play because he or she will be able to counter that charge. Your attorney can also help you throughout the process to make sure you comply with all rules and that the bankruptcy goes smoothly.

Think Bankruptcy Might Be for You?