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Chapter 7
How to file Bankruptcy
without an attorney or lawyer. File Bankruptcy
inexpensively and without an attorney. Stop foreclosure
and wage garnishments without an attorney and usually
keep everything. Personal Bankruptcy Chapter 7 and Free bankruptcy help information and services
Online bankruptcy assistance and consultation
plus--comprehensive pros and cons with an overview of
bankruptcy procedures-- plus, true stories of it's
effects and benefits.
What
some of our customers are saying...
From Kimberly in MO
I
can't believe how amazing you are-- this is
nightmare paperwork --I would've NEVER been able to
do this-- Thank You again so very much
From Chrissy in OH
You
rock!! Thanks so much for your help. I wasn't sure
what to expect doing this myself but you have been
great!!!
From Roger in MI
you
did a SMASHING job of reading what I wrote and
turning it into this very organized and beautifully
written petition--Thank You
Other Services you may need...
Learn to file bankruptcy do
it yourself or without an attorney in the northern,
southern, eastern and western states: Alabama AL, Alaska
AK, Arizona AZ, Arkansas AR, California CA, Colorado CO,
Connecticut CT, Do it yourself bankruptcy in Delaware
DE, Florida FL, Georgia GA,
File bankruptcy without an
attorney in Hawaii HI, Idaho ID, Illinois IL, Indiana
File Chapter 7 without attorneys IN, Iowa IA, Kansas KS,
Kentucky KY, Louisiana LA, Maine ME, Maryland MD,
Massachusetts MA, Michigan MI, Minnesota MN, Mississippi
MS, Missouri File bankruptcy without an attorney in MO,
Montana MT, Nebraska NE, Do it yourself bankruptcy in
Nevada NV, New Hampshire NH, New Jersey NJ, New Mexico
NM, New York NY, North Carolina NC, North Dakota ND,
Ohio OH, Oklahoma
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File Chapter 7 without attorneys OK,
Oregon OR, Pennsylvania PA, Rhode Island RI, South
Carolina File bankruptcy without an attorney in SC,
South Dakota SD, Tennessee TN, Texas TX, Do it yourself
bankruptcy in Utah UT, File Chapter 7 without attorneys
Vermont VT, Virginia VA, Washington WA, West Virginia
WV, Wisconsin WI, Wyoming WY rent to own homes and
houses for rent can be found in: Alabama AL: Gulf
Shores, Birmingham, File Chapter 7 without attorneys
Huntsville, Decatur, Florence, File bankruptcy without
an attorney in Auburn, Tuskegee, Mobile, Montgomery,
Dothan, Anniston, Tuscaloosa, Hoover, Dothan Alaska Do
it yourself bankruptcy in AK: Anchorage, File Chapter 7
without attorneys Fairbanks, Juneau, Kodiak, Valdez
Arizona File bankruptcy without an attorney in AZ:
Flagstaff, Phoenix, Scottsdale, Tempe, Tucson, Yuma
Arkansas Do it yourself bankruptcy in AR: Hot Springs,
Little Rock, Eureka Springs, Fayetteville, Fort Smith,
Jonesboro, Monroe California Do it yourself bankruptcy
in CA: Anaheim, Beverly Hills, Burbank, Carmel, File
Chapter 7 without attorneys Fresno, Hollywood, Modesto
Vacaville Laguna Beach, Los Angeles, File bankruptcy
without an attorney in Monterey, Newport Beach, Oakland,
Palm Springs, Palo Alto, Pasadena, Redondo Beach,
Sacramento, San Diego, File bankruptcy without an
attorney in San Francisco, San Jose, Santa Barbara,
Santa Cruz, Santa Monica, Carlsbad, Carmichael, Citrus
Heights, Concord, Corona, Davis, El Cajon, Fairfield,
Fremont, Hayward Huntington Beach, Irvine, File
bankruptcy without an attorney in Long Beach, Modesto,
Mountain View, North Hollywood, Oceanside, Rancho
Cucamonga, Riverside, Roseville, San Leandro, San Mateo,
Santa Ana, Santa Clara, File Chapter 7 without attorneys
Santa Rosa, Sherman Oaks, Sunnyvale, Temecula, Tustin,
Van Nuys, Vista Colorado CO: Aspen, Boulder, Colorado
Springs, File Chapter 7 without attorneys Denver,
Telluride, Vail Connecticut CT: File bankruptcy without
an attorney in Hartford, New Haven Delaware DE: Dover,
Wilmington Florida Do it yourself bankruptcy in FL: Boca
Raton, Clearwater Beach, Daytona Beach, Destin, Fort
Lauderdale, File bankruptcy without an attorney in
Jacksonville, Key West, Miami, Naples, Orlando, Palm
Beach, Panama City Beach, Pensacola, St. Petersburg,
Sarasota, Tallahassee, Tampa, Apollo Beach, File Chapter
7 without attorneys Apopka, Beverly Hills, File
bankruptcy without an attorney in Arbor Oaks at Boca
Raton, Boca Raton, Bonita Springs, Bradenton, Cape
Coral, Citrus Springs, File Chapter 7 without attorneys
Clearwater, Clermont, Cocoa Beach, Davenport, Davie,
Delray Beach, Doral, Estero, Fort Lauderdale, Fort
Myers, Ft. Lauderdale, Ft Myers, Heathrow, Jacksonville,
Jensen Beach, Kissimmee, Lake Mary, Lakewood Ranch,
Largo, Lehigh Acres, Lithia, Maitland, Miami, Miami
Beach, Miramar, Naples, New Port Richey, North Miami
Beach, North Port, Orlando, Overstreet, File bankruptcy
without an attorney in Oviedo, Palm Bay, Palm Beach
Gardens, Palmetto, Palm Harbor, File Chapter 7 without
attorneys Panama City Beach, Parrish, Ponte Vedra, Port
Charlotte, Port St Lucie, Punta Gorda, Riverview,
Ruskin, File bankruptcy without an attorney in Saint
Augustine, Saint Cloud, Sarasota, Sorrento, Spring Hill,
St Augustine, St. Augustine, St. Petersburg, Stuart,
Tarpon Springs, Wellington, Wesley Chapel, West Palm
Beach, Windermere, Wintergarden, Winter Park Georgia GA:
Athens, Atlanta, File bankruptcy without an attorney in
Augusta, Columbus, Macon, Savannah, Albany, Americus,
Bainbridge, Brunswick, File Chapter 7 without attorneys
Commerce, Cornelia, Dalton, Gainesville, Hinesville Fort
Stewart, LaGrange, Lake Oconee, Milledgeville, Rome, St
Marys, Statesboro, Do it yourself bankruptcy in
Thomasville, Toccoa, Valdosta, Warner Robins, Waycross..
Acworth, Alpharetta, Atlanta, Auburn, Austell, Avondale
Estates, Bowdon, Bowdon Junction, Brooks, Buford,
Canton, Carrollton, Cartersville, Clarkston, College
Park, Conley, Conyers, Covington, File bankruptcy
without an attorney in Cumming, Dacula, Dallas,
Dawsonville, Decatur, Doraville, Douglasville, Duluth,
Dunwoody, East Point, Ellenwood, Emerson, Fairburn,
Fayetteville, Forest Park, Grayson, Griffin, File
Chapter 7 without attorneys Hampton, Hapeville, Hiram,
Inman, Jasper, Jonesboro, Kennesaw, Lawrenceville,
Lilburn, Lithia Springs, Lithonia, Locust Grove,
Loganville, Lovejoy, Mableton, Marietta, McDonough, File
bankruptcy without an attorney in Monroe, Monticello,
Morrow, Mount Zion, Newnan, Norcross, Peachtree City,
Powder Springs, Rex, Riverdale, File Chapter 7 without
attorneys Rockmart, Roopville, Roswell, Senoia, Smyrna,
Snellville, Statham, File bankruptcy without an attorney
in Stockbridge, Stone Mountain, Sugar Hill, Suwanee,
Temple, Tucker, Tyrone, Union City, Villa Rica, Waleska,
Whitesburg, Winder, Woodstock.. Hawaii HI: Honolulu,
Kauai, Maui, Oahu Idaho ID: Boise, Pocatello, Sun Valley
Illinois IL: Champaign-Urbana, Chicago, Moline, Aurora,
Rockford, Do it yourself bankruptcy in Naperville,
Elgin, Joliet, Peoria, Springfield Indiana IN: Angola,
Bloomington, Etna Green, Evansville, Fort Wayne,
Indianapolis, South Bend, Terre Haute Iowa IA: Cedar
Rapids, Des Moines, Iowa City Kansas KS: Kansas City,
Topeka, Wichita Kentucky KY: Lexington, Louisville,
Bowling Green, Campbellsville, File bankruptcy without
an attorney in Danville, Elizabethtown, Frankfort, File
Chapter 7 without attorneys Georgetown, Harrodsburg,
Henderson, Hopkinsville, Mount Sterling, Owensboro
Paducah, Prospect, Do it yourself bankruptcy in
Radcliff, Winchester Louisiana LA: Baton Rouge, New
Orleans, Shreveport Maine ME: Bangor, Kennebunkport,
Portland Maryland File Chapter 7 without attorneys MD:
Annapolis, Baltimore Massachusetts MA: Amherst, Boston,
Cambridge, Springfield, File bankruptcy without an
attorney in Worcester Michigan MI: Ann Arbor, Detroit,
Kalamazoo, Lansing, Traverse City, Ypsilanti, Brighton,
Battle Creek, Marshall, Albion, Bay City, Benton Harbor,
File Chapter 7 without attorneys St. Joseph, Niles, Big
Rapids, Cadillac, Livonia, Dearborn, Flint, Gaylord,
Grayling, Houghton Lake, Petoskey, Grand Rapids,
Wyoming, Kentwood, Holland, Grand Haven, File bankruptcy
without an attorney in Houghton, Jackson, Portage, East
Lansing, Marquette, Ishpeming, Midland, Monroe, Do it
yourself bankruptcy in Mount Pleasant, Muskegon, Norton
Shores, Royal Oak, Southfield, Troy, Warren, Birmingham,
Rochester, Rochester Hills, Saginaw, Sault Ste Marie,
Beaverton, Farmington Hills, Fenton, Fremont, Garden,
Gladstone, Linden, File Chapter 7 without attorneys
Livonia, Mears, Mount Morris, Ortonville, Oxford,
Pontiac, Sandusky, Warren, Waterford Minnesota MN:
Duluth, Mankato, Minneapolis, File bankruptcy without an
attorney in St. Paul, Rochester Mississippi MS: Biloxi,
Jackson Missouri MO: Branson, Kansas City, St. Louis
Montana MT: Billings, Butte Nebraska NE: Lincoln, Omaha
Nevada NV: Las Vegas, File Chapter 7 without attorneys
Reno New Hampshire NH: Concord, Hanover, Manchester,
Portsouth New Jersey NJ: Princeton, Newark, File
bankruptcy without an attorney in Trenton New Mexico NM:
Albuquerque, Las Cruces, Los Alamos, Santa Fe New York
NY: Albany, Buffalo, Ithaca, New York City, Niagara
Falls, Rochester, Syracuse North Carolina NC: Chapel
Hill, Charlotte, Durham, Fayetteville, Greensboro, King,
Raleigh, Winston-Salem North Dakota ND: Fargo, Grand
Forks Ohio OH: Cincinnati, File bankruptcy without an
attorney in Cleveland, Columbus, Dayton, Lima, Toledo,
Wheeling Oklahoma OK: Oklahoma City, Tulsa Oregon OR:
Ashland, Eugene, Portland, File Chapter 7 without
attorneys Salem Pennsylvania PA: Bethlehem, Erie,
Harrisburg, Hershey, Do it yourself bankruptcy in
Philadelphia, Pittsburgh, Scranton, State College, York,
Lancaster Rhode Island RI: Charleston, Newport,
Providence South Carolina SC: Charleston, Columbia,
Greenville, Myrtle Beach, Rock Hill, Augusta, Florence,
File bankruptcy without an attorney in Sumter, Hilton
Head Island, Spartanburg South Dakota SD: Pierre, Sioux
Falls Tennessee TN: Chattanooga, File Chapter 7 without
attorneys Gatlinburg, Knoxville, Memphis, Nashville,
Pigeon Forge Texas Do it yourself bankruptcy in TX:
Amarillo, Austin, College Station, Corpus Christi,
Dallas/Ft. Worth, El Paso, Galveston, Houston, San
Antonio Utah UT: Ogden, File Chapter 7 without attorneys
Salt Lake City Vermont File bankruptcy without an
attorney in VT: Burlington, Montpelier Virginia VA:
Alexandria, Lynchburg, Norfolk, Richmond, Virginia
Beach, Williamsburg Do it yourself bankruptcy in
Washington File bankruptcy without an attorney in WA:
Olympia, Seattle, Spokane, Tacoma West Virginia WV:
Charleston, File Chapter 7 without attorneys Morgantown,
Wheeling Wisconsin WI: Madison, Milwaukee Wyoming WY:
Cody, Yellowstone
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Free
Bankruptcy Manuals, Free Bankruptcy Forms
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Bankruptcy Advice, Chapter 7, Chapter13
THIS IS ONE OF THE MOST INFORMATIVE,
COMPREHENSIVE BANKRUPTCY SITES ON THE WEB
We will
show you... |
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How to file Bankruptcy Without an Attorney
How to Stop Foreclosure
How to Get Rid of Back Taxes
How to File Bankruptcy and Still Buy a Home |
How to File Bankruptcy Cheaply
How to Stop Wage Garnishments
Discharge All Debt and Keep All Your Assets
When Bankruptcy Can Actually be GOOD for Your
Credit |
... And Why,
(contrary
to what credit card companies and consumer credit
counseling firms have led the public to believe),
you can still File Bankruptcy, Discharge All Debt
and STILL almost certainly, Keep Everything
You Own!
Note: If you are in danger of
losing your home please see our Mortgage
Renegotiation Services.
Simply
Put, We don't preach-- we teach. Our goal
is not to look out for the interests of
the credit bureaus or creditors--
It is to provide the best
information and service available for solving your
issues.
The decision as to how to use the
information is left to you.
WE MAKE THE PROCESS SIMPLE!
What some of our
customers are saying...
|
From Kimberly in MO
I
can't believe how amazing you are-- this is
nightmare paperwork --I would've NEVER been able to
do this-- Thank You again so very much!
|
From Vivian in CA
Last Tuesday, I went for my appointment with the
Creditors. After waiting for approximately
35 minutes, the interview took only about 5
minutes. The Judge was very cordial. None of
the Creditors were present. It was not stressful, as I had anticipated. There were
many people there for the same reason as
me, so that gave me a level of comfort to
know that I am not alone in this critical
financial situation. |
From Clarence in FL
My first
and last meeting with
the creditors went
great! (August 5,
2011). No creditors
showed up to question me
and my discharge papers
are already on the way.
Having this out of the
way and done is such a
great feeling.
Thanks,
to all who helped.
|
From Roger in MI
you
did a SMASHING job of reading what I wrote and
turning it into this very organized and beautifully
written petition--Thank You |
From Chrissy in OH
You
rock!! Thanks so much for your help. I wasn't sure
what to expect doing this myself but you have been
great!!! |
|
Crucial Bankruptcy Links and
Information
We
provide Online Bankruptcy Assistance,
Free Consultation,
plus-- comprehensive pros and cons with an overview
of bankruptcy procedures-- plus, true stories of
it's affects and benefits.
We
even GIVE you the resources, (Free
Forms and Manuals) that will allow you to
file completely on your own, if you so choose.
If you want professional assistance, we
guarantee to provide you with the
very best service at the very lowest fees,
about one fourth of most attorney's fees.
HOW WHAT DOES IT COST TO FILE BANKRUPTCY
The fees to the
court are usually about $299.
If you qualify for a
"Waiver of Court Fees", that portion would be free.
And
in some instances the court will allow you to pay their
fees
in installments.
(for details call 877 604 6636 Ext 3)
Please reference Service ID # 1000
WHAT DO WE CHARGE TO PREPARE YOUR BANKRUPTCY?
Chapter 7--
Most Attorneys
charge anywhere from $1,200 to
$2,000, for a Chapter 7 (complete discharge of
debts).
Our fee for a
Chapter 7 is ONLY
$295 and
even that is broken up into 2 payments.
Chapter 13
(Where a repayment plan is developed in which all debts
are paid over a 3 to 5 year period),
Most Attorneys
charge anywhere from $3,000
to $5,000 or more for a
Chapter 13.
Our fee for a
Chapter 13 is only
$ 800
and we help you by breaking this up into
3
installments.
How Can We Charge So Little Compared to Everyone
Else?
There is a
tendency in business to charge that which the market
will bear. Oil companies do it--
so do attorneys.
Attorneys not only
can charge... but can actually get,
exorbitant fees-- so they do.
We Do More Than Bankruptcy
We are much more than Bankruptcy Preparers. We handle a
myriad of services and issues, Bankruptcy,
Taxes,
Wills,
Credit Repair,
Home Sales, Home
Loans,
Financial Opportunities, etc... in fact, we are
known as the No Down Home Purchase specialists helping
people all across the US to buy homes with no down
regardless of credit, hence our phone number...
America
West Homes
Toll Free 877 60
4 No Down
(877
604-6636) Ext 3
When calling, please
reference Service Code 1000
We know that by
treating you right with our combination of premium
service and low fees, we will be your company of choice
for all your future business and financial needs.
We don't want you
just as a customer for today, we want you and your
family, and friends as customers for life.
And quite
frankly, as pertains to bankruptcy... because, we
utilize the most up to date technologies and software,
we can accomplish in 5 hours what it might take others 5
days to accomplish.
Remember, it is our goal
to provide the options you need to solve your
issues. If you need our services, we're here to
help. If you prefer to do it on your own, we'll
help there, too.
Questions? Call Toll Free 877 604 6636
ext 3
Please when calling reference Service ID 1000
At The Solutions Network, we do more than prepare your
bankruptcy petition. We help prepare you for
Life After
Bankruptcy... The Complete Bankruptcy Package
gives you all of this...
Complete
Bankruptcy Document Preparation so you can get a
Financial Fresh Start--
We prepare all
schedules, including the Federal Bankruptcy Petition
plus, Schedules A, B, C, D, H, J, Statement of Financial
Affairs, etc...
Tri-merged credit report--
we help you get a
FREE
Tri-merged report, so you don't miss creditors.
A complete record of all debts you owe, credit cards,
car loans, real estate loans, collections, judgments,
tax liens, school loans, including balances, payment
amounts, creditors names and their addresses-- Saves you
hours in your debt investigation..
Remember,
if they are not listed in your Bankruptcy, you still owe
the debt!
Do It Your Self Credit Repair Kit--
see
credit repair.
By utilizing the techniques that we include in these 2
Creditor Busting Ebooks you will be able to immediately
begin to improve your credit rating and credit score,
in
spite of your bankruptcy.
Bankruptcy
Information Packet--Comprehensive,
but easy to understand information that shows how to
maximize the benefits of your bankruptcy by not only
eliminating
debts, but by reducing the amount of debt remaining on
that car or furniture on which you still owe money but
want to keep. In other words-- keep the car-- but
get rid of half the debt.
The Truth is that
Bankruptcy has it's Benefits and
it's Drawbacks-- but whether it is the right decision
for you depends on your particular situation...
For
one family Bankruptcy was the
only way
to achieve
home ownership...
For
another family, the failure to file, when truly
necessary, almost cost them
everything.
To see how and
why bankruptcy impacted these families' lives see
"Scenarios 1 & 2" Below.
Note:
The Solutions Network provides low
cost bankruptcy services in all states including the following states
and protectorates.
Alaska AK Alabama AL Arkansas AR Arizona AZ California
CA Colorado CO Connecticut CT Washington DC Delaware DE
Florida FL Georgia GA Hawaii HI Iowa IA Idaho ID
Illinois IL Indiana IN Kansas KS Kentucky KY Louisiana
LA Massachusetts MA Maryland MD Maine ME Michigan MI
Minnesota MI Missouri MO Mississippi MS Montana North
Carolina NC North Dakota ND Nebraska NE New Hampshire NH
New Jersey NJ New Mexico NM Nevada NV New York NY Ohio
OH Oklahoma OK Oregon OR Pennsylvania PA Puerto Rico,
Guam, Rhode Island RI
South Carolina SC South Dakota SD Tennessee TN Texas TX
Utah UT Virginia VA Vermont VT Washington WA Wisconsin
WS West Virginia WV Wyoming WY
In
spite of an effective National Campaign by creditors,
that fact is...
life after bankruptcy is not as
difficult as often imagined or portrayed.
Even so, whether
or not to file Bankruptcy is one of the most difficult
decisions that a person makes in today’s society.
Good decisions require
accurate information. The things that cause
people to come to a point in their life where Bankruptcy
becomes something to even be considered are many
varied. But at this point, we are not going to talk
about how we got to that place, but rather,
what to do about it-- and to
inform you of the true consequences.
We all know that bankruptcy is not
a good thing. It goes on your credit report and stays
there for 10 to 12 years, and yes, for a year or two, if
you apply for a loan, you will pay a higher interest
rate.
There's no
question, bankruptcy is rarely the ideal
solution, but it is often the best solution--
and as we'll see, it also is not an economic death
sentence.
Crucial Bankruptcy Links and
Information
Note:
Recently, there has been a lot of discussion about
credit improvement services.
Many companies are scams--
some are reputable. Credit restoration has it's
benefits and it's limitations. Often times the
effective dispute of derogatory credit can
eliminate the need for
bankruptcy and
allow you to pursue objectives you may have that are
almost impossible with the derogatories still on
your credit file or with a recent bankruptcy.
For a
comprehensive discussion of the benefits and
limitations of credit restoration,
click here.
Should You File Bankruptcy?
There is no magic
formula that tells you whether bankruptcy is the best
choice for you-- but here a few facts to consider.
|
You
don't need bankruptcy
protection now if...
You have nothing that a creditor with a judgment
could take from you, in either assets or income:
that is, if everything you have is exempt under
the laws of your state, including your source of
income, you have nothing to lose to a creditor
and no need for bankruptcy protection now.
However, it's important to
realize that just because the creditor has
nothing to attach, now,
does not mean that the debt can’t come back to
haunt you.
Are your
present circumstances a temporary financial
glitch?
Will you in the
near future be better off? New job?
Extra Income? Will you soon have your finances
in place?
If you file now, (while down in the dumps, so to
speak), you will undoubtedly be able to keep
everything and pass the federally
mandated means test (Don't
worry, we handle that for you)--plus...
in two years you will be almost blemish free
with no outstanding collections, late pays, or
judgments. Your credit worthiness will then be
determined by your, then current, income and the credit track
record you create after the bankruptcy.
If you keep a clean slate, you will again
be considered a good credit risk.
WHAT IF YOU DON'T
FILE?
If you DON'T FILE, and your
financial situation
improves? Obviously getting back on your feet is great
thing, but... In Two Years you could be
faced with this-- You've
weathered the storm and now have great income,
living the American Dream, have newly acquired
assets, Great Income, But Now...
Instead of a having two year old discharge, and no
existing debts, re-established credit, (your
situation if you had filed), you
still have collections and judgments-- but now
that you have an income and something to take, your past
creditors are coming after you! And
Chapter 7 protection is out of the question
because now that you are living the American
Dream... You make too much money to pass the
means test! You will now have to pay back
old debts or face garnishments.
Even
more so, (If
you didn't file) and you now attempt to buy a
home, (
See No Down Real Estate Investment), the
existence of the still owed collections and
charge offs will in many cases prevent you from
getting a home loan until they are paid, and at
the very least will necessitate a higher
interest rate and down payment. If, on the
other hand, your BK is one to two years old and
all debt since then has been paid on time,
you will again be considered a good credit risk
and qualify for the best home loans available.
There are even many purchase programs that will work for you
immediately out
of bankruptcy.
I
want to make something clear.
The above
the above scenario, nor those that follow are in
anyway intended to try to
convince you that you should file bankruptcy.
That decision is absolutely yours and yours
alone. We just want to be certain that any
decision you make is based on a complete
understanding of facts and actual, rather than
imagined consequences.
|
The Truth About Bankruptcy
The decision to file is intensely personal. It
is yours and yours alone. Whatever, decision you
make, be certain that is made with all the facts in
hand.
What I am
going to do here is not necessarily give you advice but
rather elaborate on a couple of scenarios that I have
had with my clients while dealing with Bankruptcy, and
credit related facts-- also, what I suggested that they
do and the end result. Of course, how you proceed and
the decisions you make are yours and yours alone. My
goal is to simply help you proceed with a broader view
of what bankruptcy is. Hopefully, this article will
give you more relevant, real life facts to help you make
a fully informed decision--
See the following true life stories of past clients.
|
Inevitability.
Should You File Now? or
File Later? |
Is
doing the Right Thing
the Wrong Thing for
Your Family? |
Do you own a home and are in danger of losing it? See
our article regarding alternatives and possible
solutions to
Foreclosure
Remember, you
rarely have to lose your home.
Even though, Bankruptcy should be a last resort, if all
else fails, a Chapter 13 will almost always allow you to
save your home.
SHOULD YOU FILE
BANKRUPTCY NOW OR LATER?
I had a close
personal friend who came to me wanting to buy a home.
During the loan process we found that he had absolutely
impeccable credit. Unfortunately, his income was only
slightly more than his outgo, (as in about $100 per
month, and this was before food and utilities!),
. My first question to him was how are you managing to
make all your payments on time. I had never seen anyone
so overloaded with debt while making their payments so
flawlessly. He informed me that he was effectively
borrowing from Peter to pay Paul. Borrow from one
credit card to pay another, then open another credit
account to pay the last...
Under
these circumstances, there was no way that he could
qualify for a normal loan. He only wanted around an
$80,000 home, but even with the $8,000 down he was
getting from a settlement, he could not qualify for a
conventional low rate loan. His expenses vs income was
just too high.
As I
explained to him, with his income to debt ratios, he
would never be able to buy a house. At least, not
with a fixed rate or reasonable down payment. We
were going to have to get creative. I then
explained to him that with his situation-- Namely,
the fact that every month he was going further and
further into debt. His minimum payments on the
credit cards were getting larger and larger-- His
income was staying relatively stagnant. He was
unquestionably spiraling into the need for a
bankruptcy. The only real
question was would it be now or later?
Here’s what we did. We used his $8,000 insurance
settlement for his down payment. I persuaded the seller
of the property to carry $12,000 for a term of 30
months. Now, that we only needed a loan for $60,000 on
an $80,000 home, We were able to
get him a loan
secured by the property. It was not a good loan, but a
loan, nevertheless. This loan was fixed at 6%, but for
only two years. After that it would adjust to about
12%, thus increasing my friends payment by about $300
per month over the original payment.
Generally, I wouldn’t negotiate
this deal for my worst enemy, but we had a strategy that
would insure that he would never have to pay that high
interest rate.
NOTE:
If
a person files Bankruptcy and then from the date of
discharge, keeps any new or reaffirmed debts paid
perfectly, for most lenders, in two years, they will
be considered to again be a good credit risk.
We closed the deal, he now owned the home
and he then immediately filed
Bankruptcy. So he discharged his
unsecured debt, and reaffirmed his home and
car loan. (i.e. continued to make payments on home
and car).
NOTE:
There are now loan programs that will allow you to
get a home loan within 6 months
after bankruptcy or even one day with a substantial
down payment.
See
Home
Loans
At the end of two years,
he had paid his remaining bills perfectly.
Additionally, because he had all of the unsecured debts
discharged, his monthly obligations were reduced by
about $600 per month. He now had good credit and
income to debt ratios that were reasonable, so he could
now refinance his home and get rid of that first
mortgage that was getting ready to go to 12%-- plus,
because his home had appreciated, we could even pay off
the $12,000 that he still owed the seller. Because his
finances were now in balance I was able to get him
approved for a refinance to do the above at a fixed 6%
interest rate loan.
Amazingly enough-- this was one of those rare situations
in which the only way to accomplish the
goals of home ownership for himself and his family, was
Bankruptcy.
***********************************************************************************************************
IS DOING THE
RIGHT THING, THE WRONG THING FOR YOUR FAMILY?
Doing
the right thing is always admirable.
But it has been my experience that sometimes doing the
right thing for the creditors is absolutely the wrong
thing for your family...
I was recently contacted by a family that had been
struggling with debt for 3 years. Prior to the
beginning of their problems they had both had very good
jobs. As with most of us, good jobs equal good
lifestyle and lots of debt. Their income was such that
they were not overloaded in the least.... but then he
lost his job, the family income was halved for about
six months. They had some 30 day lates, but nothing too
serious. He finally found other employment-- just
about the time that she lost her job!... Over
the next three years, for both of them, employment was
sporadic. In their attempt to do the “right thing”
i.e. keep their home, pay their bills, even if late... they
drained not only their savings,
but raided their retirement accounts (Which
you can almost always keep when you file Bankruptcy),
To make
matters worse, dipping into retirement accounts, carried early
withdrawal penalties and extra tax liabilities, (we managed to avoid most of the
penalties on an
amended tax return), but the point is that they were
financially drowning.
At all costs, they were determined to avoid bankruptcy.
They wanted to do the right thing and pay their
creditors. They continued their spiral and sporadic
employment for three years.
This
was admirable and I respect them immensely for their
integrity. But now,
they have nothing left. Even their
retirement is gone! Their home was in foreclosure
and to keep the home, for themselves and daughter,
they finally decided to file a chapter 13
bankruptcy.
If they had filed two years
earlier, when the spiral was obviously out of
control...
They would now have good credit, they
would still have their retirement, and they would be
stress and debt free. As it stood, we saved their home, but
their retirement is forever lost and good credit is
a thing that will elude them for another two years.
In
my opinion, the moral of the story is, if you can fix
your finances, by all means, do so. But please, for
your and your families sake, make an honest and
objective assessment of your ability to pull out of the
financial morass. If Bankruptcy is inevitable,
do it now,
not after your retirement is gone.
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