Bankruptcy Credit Cards

Archive for February, 2010

It is important to make smart financial decisions throughout your life because the economy is very unpredictable.  If you are interested in investing in some risky ventures with the hope of big payoffs, that is fine as long as you know you can cover your debt. Never give away more that you can lose. If you feel like you have insurmountable debt, however, and you feel like declaring bankruptcy is the only solution, you have two options. You can file for bankruptcy Chapter 13 or Chapter 7.

Chapter 13 bankruptcy is also known as the wage earner’s plan. It is the way in which someone who has a steady income can work with a professional accountant in order to determine a new repayment plan for the next three to five years. This form of bankruptcy is preferable to that of Chapter 7 because you are still able to retain your possessions such as your house and car as long as you are able to continue to make your payments on these items. The non-exempt debt is restructured and all of your monthly payments go through a trustee at the bankruptcy court who, in turn, distributes the money to your creditors. Your creditors are no longer allowed to harass you once you have filed for bankruptcy.

Not everyone is eligible for bankruptcy Chapter 13. You debts cannot total a certain amount (the limit of which changes frequently) and you need to have a steady income. Talk to your lawyer to find out if Chapter 13 will work best for your situation.

Chapter 7 is known as liquidation or straight bankruptcy. This Chapter applies for both individuals and businesses and should be the last resort. This Chapter entitles the bankruptcy court to seize your assets and sell them immediately. All the money made off the liquidation of your assets goes to paying off your creditors. Just as in Chapter 13, your creditors cannot contact you for the money any longer. All correspondence must go through the court and your lawyers.

In the best case scenario, you do not need to file for bankruptcy at all. If you find that it is your only option, try to file for Chapter 13 if you can!

Jane Worthington
http://www.articlesbase.com/bankruptcy-articles/bankruptcy-chapter-13-101-756406.html

What do you need to do to get credit card counseling debt consolidation? If huge debt amount is haunting you day and night and you just don’t know how to get out of it then don’t worry there are ways out. One of the ways that you can select is to look out for credit card counseling debt consolidation services. These services help you when huge amount of debts has left you regretting your decision for getting so many credit cards in the first place. What happens during credit card counseling? During credit card counseling, companies organize various sessions that educate you on controlling your finances and work towards to a better debt-free future. You can work along with your counselor to develop and practice an effective debt management program. They teach you how to control your indiscriminate spending and negligent payment habits. They also work towards making you a better, responsible and dutiful consumer.

When should you start credit card counseling?

You must seek a credit counseling program only when you have decided to get rid of all your debts and are prepared to do anything to achieve this goal. In the process, the most important point is that in order to survive for a longer period you must be confident and must not be afraid of appearing ignorant. First and foremost, you must select your credit card debt counseling company carefully and should be cautious of fraud firms that have sprouted all over. After you have chosen the right firm, you must ask them all kind of questions until you understand the problem. Additionally, you must try and do some self research also.

What are the main components of credit card counseling debt consolidation program?

When you sign up with a credit counseling programs you may be asked to fill up a debt consolidation form. Your credit card debt may be a part of this form. Therefore, prior to going ahead you must ensure all possible side effects of this action. One of the main points that you must check is whether in the process of consolidating your debt you will able to use any of your credit cards or not. Under most circumstances your debt consolidation programs will require you to surrender all your cards. Therefore, to get yourself out of this situation you must be ready to do away with all your cards and work towards preventing yourself from piling up huge debts once again. In addition to all the measures you take, when resorting to a credit debt counseling service, you must make it a top priority to get rid of all your unsecured debt also. However, remember you can achieve all this only if you go and sign up with right credit card debt counseling company today.

Jeffrey J. Walteron
http://www.articlesbase.com/finance-articles/what-are-the-main-components-of-credit-card-counseling-debt-consolidation-program-122784.html

Life after bankruptcy can have a great impact on your financial life. For some, bankruptcy provides a fresh start and debtors receive numerous loan and credit offers before their debts are even fully discharged. For others, bankruptcy prevents them from getting a decent interest rate on a house or other major purchase. It is always important to consider all of the ramifications and other options before making the final decision to file bankruptcy.

One of the biggest complaints that people have about bankruptcy for the sake of a new start is that it does not change a person’s habits. Oftentimes, people get deep in debt because of bad spending habits or because of letting their credit cards and consumer debts get out of control. The actions you take after bankruptcy are vital to keeping the management of your finances under control.

This is one reason that bankruptcy does not actually help people. Without behavior change, the majority of filers fall back into the same destructive spending habits that they had before their debts were discharged. Therefore, recognizing that you have a spending problem is vital before considering bankruptcy.

If you file bankruptcy without going through some type of financial management training, you have a greater chance of repeating the same mistakes. New laws require filers to complete a money management course before their debts are discharged. This is a step in the right direction to help people realize how to use credit as a responsible aspect of their finances rather than abusing it until it is too late to climb out of the debt that they have accumulated.

The final step following a bankruptcy is to deal with the negative ramifications it has on your credit. For purposes of getting a home mortgage, bankruptcy will stay on your credit record for the rest of your life. This could be bad news for the interest rate or the repayment terms of your mortgage even several years after bankruptcy. If you file bankruptcy due to one single major setback in your life, such as an illness that resulted in huge medical bills or a job loss, some mortgage companies will work with you.

While it still shows up on your credit, mortgage companies that do manual underwriting can customize your home loan and they will consider your specific situation. Be sure to save any papers related to the event so you can present them to the mortgage company when it is time to buy a home.

Your life after bankruptcy can return to a sense of normalcy if you take steps to limit its negative implications. Changing your spending habits is the most important thing you can do to ensure that you do not get in the same predicament again. Examine how you spend your money and use a written monthly budget. Only spend money that you have rather than buying things on credit, too.

If your bankruptcy was a result of a single life event, keep the papers associated with the event in case you ever need proof of your circumstances. The best thing is to realize your mistakes and move on with your life.

MIKE SELVON
http://www.articlesbase.com/non-fiction-articles/a-perception-of-life-after-bankruptcy-140119.html

If you haven’t noticed, unless we make some drastic changes, our nation is headed into a literal Credit Card Debt tsunami. As credit has tightened and banks are seeing the errors of their ways, (i.e., easy credit approvals) more and more credit card companies are raising interest rates if you even smell like you are having financial problems.

The reverberating effects can be chilling; consumers are waking up and finding out that credit card debt has put them in the dreaded financial danger zone. There are some distinct signs to let you know if you are headed into trouble. Heed this advice and you’ll surely avoid the stress and strain that comes with credit card debt.

Credit Cards Nearly Ruined My Life
One credit card customer (I’ll call Bradford) wrote me to explain how credit card debt nearly ruined his life. He had a wallet full of credit cards, 15 in all! An American Express, 3 Visas, 3 MasterCard’s, 2 gas cards, 4 credit cards from major retailers and 3 credit cards from national jewelers.

All of Bradford’s credit cards except 2 of the jeweler’s cards had balances; eight of them were maxed out. Since he was only paying the minimum monthly payment on each account, it would be around twenty years before he would have most of the balances paid down. And that was provided that he stopped accumulating new charges.

What Happened To My Credit Line?
Bradford’s wake up call came one day when he attempted to make a major purchase (a vehicle no less) on a Visa credit card that had a line of credit at $10,500.00 and was declined. He called his credit card company to find out what was going on and that was the first time he heard about the company’s credit card policy. Every credit card company has one. It’s written in very small print and is always neatly tucked away so that it is hard to find and even harder to read.

In his case, the small print stated the credit card company had a right to alter his credit line and interest without notice, period and end of story. In an instant, in accordance with their policy, his bank chopped his line of credit down from $10,500.00 to $1500.00. Plus, they raised his interest rate from 8.5% all the way up to 23.75%.

Why? Because they ran a credit check, (which they have a right to do) and saw that Bradford’s credit card debt was no longer in a safe income to debt ratio. Right after that company cut his credit line and raised his rates, all of his creditors followed suit. Bradford was now in the credit card debt danger zone. In the rest of this session, let’s talk about how he got there. When Bradford took our test and failed; he knew he had to make changes and fast! To measure where credit card debt has taken you, take the test now.

Test #1
Do you generally only pay the minimum payment on your credit card or other loan balances?

Test #2
Are you habitually sending your payments in late?

Test #3
Do you have one or more credit cards that are maxed out?

Test #4
Do you find yourself skipping payments so that you can have cash on hand?

Test #5
Do you use credit cards to pay for things you should be paying for with cash?

Test #6
Are creditors calling you regarding late payments?

Test #7
Are you spending more than 10% to 15% of your take home pay on credit card debt and other loans?

Test #8
Have you ever taken credit card cash advances to meet living expenses?

Test #9
Is your credit card debt bothering you, emotionally, mentally or spiritually?

Test #10
If you had no credit card debt, would you be able to save money every payday?

If you answered, “Yes,” to just two or more of these test questions, you are definitely headed into debt trouble, if you are not already there. If you find yourself in trouble, stop what you’re doing and seek help now!

Joel Marks
http://www.articlesbase.com/credit-articles/10-signs-that-you-are-headed-into-credit-card-debt-danger-678840.html