What Does Bankruptcy Do To Your Credit Score?

What Does Bankruptcy Do To Your Credit Score?

King and King Bankruptcy Attorneys 12/28/12

Bankruptcy reduces balances due to zero on your credit report.  However bankruptcy does not remove a creditor from your credit report and it does not remove the history of missed payments. If you’re looking to remove a creditor from your credit report you can simply wait for them to drop off or file a valid dispute with the credit bureaus.  The most important effect of bankruptcy on your credit report is that it removes your obligation to repay past debts, and that allows you to start rebuilding your credit.

Your credit score will drop after you file for bankruptcy, however your credit score will usually go back up shortly after the bankruptcy is filed because your debt to credit ratio improves.  You will also start to get offers for credit cards and other loans after you file.  When reestablishing credit make sure that the secured credit card reports to the credit bureaus and to have a plan of action to keep your debt under your control. 

I Don’t Want My Credit Score to Drop, Should I File Bankruptcy?

If you are missing payments, then your credit score is decreasing and won’t stop until something is done about it.  If you have trouble paying your bills each month and have no savings, then one large unexpected expense can put you in serious financial jeopardy.

If you cannot pay down your debt and don’t have any savings, then bankruptcy is an option for getting a new start on your financial life. Call King and King at 404-524-6400 for a free bankruptcy consultation today.

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Are Tax Penalties Dischargeable in Bankruptcy?

Are Tax Penalties Dischargeable in Bankruptcy?

King and King attorneys, 12/19/12

The government wants their tax revenue, and if you've ever been in debt to them you know how far they will go to get it.  Back taxes can be a large burden, especially with interest and penalties.  You can use bankruptcy to take care of debts to the IRS.

In general, outstanding tax debt that is less than 3 years old is not nondischargeable, as are tax debts where the debtor has engaged in some sort of deception such as failure to file returns, attempting to evade taxes, and failing to withhold employee taxes.

Now the IRS has some very detailed documentation on how bankruptcy can discharge tax debt. If you want to have a closer look, the IRS details can be found here.  However the short answer is that you can use a chapter 13 bankruptcy to discharge your tax debt.  If you have non-dischargeable tax debts, then you can use a chapter 13 bankruptcy to payoff your taxes.  A chapter 13 bankruptcy allows you to payoff your taxes over 5 years.

If you’re considering filing bankruptcy and you want to include tax debt, you need an experienced bankruptcy attorney on your side. Call King and King for a free consultation at 404-524-6400 

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Can you qualify for a mortgage after bankruptcy?

Can you qualify for a mortgage after bankruptcy?

King and King Bankruptcy Attorneys, 12/14/12

If you’re considering bankruptcy, Chapter 7 can be a very useful option. Although it is not available to everyone - it depends on several different factors, including income - for those who qualify the discharge of debt can lead to a much more solid financial future. However, most everyone who has considered filing for bankruptcy knows that doing so does have its drawbacks, including appearing on the filer's credit report. And, some people believe that having a bankruptcy on your credit report will keep them from making significant financial transactions, such as buying a car or a home, for years.

In fact, someone who has filed for bankruptcy may be eligible for a mortgage within only a couple of years. Depending on the type of personal bankruptcy option, a filer in a post-bankruptcy financial existence may be able to pursue a government-backed mortgage in as little as 1-2 years, and a conventional mortgage in as little as 2-4 years.

There are many reasons why you may be hesitant about considering personal bankruptcy, and the subsequent lack of mortgage options could be one factor. However, when you have the right information about where you stand financially, and how bankruptcy can offer you a fresh start, you may have an easier decision to make than you thought. For a free consultation with an experienced bankruptcy attorney, call King and King 404-524-6400

Can Chapter 13 Bankruptcy Stop Foreclosure?

Will filing a Chapter 13 bankruptcy stop a foreclosure sale?

December 12, 2012, King and King Bankruptcy

Yes, it’s true.  A Chapter 13 bankruptcy will stop a foreclosure sale.  Chapter 13 bankruptcy helps so many people and families save their home, save their vehicle, get out of tax debt, stop lawsuits and basically get their life back without losing the things that mattered most to them.

To save your house from foreclosure, a Chapter 13 bankruptcy is what you will want to file, not Chapter 7.  In many cases homeowners are first sent a certified letter called a NOTICE OF DEFAULT.  You generally have 30 days to bring your mortgage payments current and if you fail to do so you then receive a NOTICE OF SALE.  This is also called a foreclosure sale date.

Home foreclosure can happen within a surprisingly short period of time. Don’t wait until it is too late to file a Chapter 13 bankruptcy.   Working with your mortgage company on a loan modification process or debt workout plan is a great first option, but also prepare to file a Chapter 13 bankruptcy to stop the foreclosure sale as a backup plan. Meet with a bankruptcy attorney to learn what you need to do to file a Chapter 13 bankruptcy at the last minute.  Initial bankruptcy consultations are provided free of charge and they are totally confidential.

Filing bankruptcy is never a first choice and nobody wants to file bankruptcy if there are other options.  But, there are situations where filing bankruptcy is the very best option.  Chapter 13 bankruptcy works!  And, it works fast.  Call King and King for a free bankruptcy consultation today, 404-524-6400

Can Bankruptcy Eliminate Your Student Loans?

Can Bankruptcy Eliminate Your Student Loans?

While bankruptcy can provide you with a fresh start, current bankruptcy laws state that federally insured student loans are not dischargeable, unless you can prove in court that repaying the loans is an "undue hardship." The legal code does not include a definition of what is an "undue hardship."  In each jurisdiction, Judges apply a test to the debtor's circumstances.

Most jurisdictions use a 3 prong test; it requires a borrower to show 3 things:

(1) that the debtor cannot maintain, based on current income and expenses, a minimal standard of living for the debtor and dependents if forced to pay off student loans;

(2) that additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and

(3) that the debtor has made good faith efforts to repay the loans.

While on the surface it may seem like you could qualify, subsequent cases show that it is extremely difficult to overcome the test in order to obtain dischargeability as Judges strictly rule on what is considered "good faith efforts" and "whether the state of affairs is likely to persist for a significant portion of the repayment period." Typically, people with income that does not exceed 150 percent of the poverty level are considered "low income individuals." But, don't forget the two other prongs of the test as all 3 must be met.

STUDENT LOANS AND CHAPTER 7

The filing of a Chapter 7 case does trigger protection of the "automatic stay." The lenders are supposed to cease any/all collection efforts until either a relief of stay motion is granted or the debtor's case closes post discharge or is dismissed. The creditors typically wait until the case closes and resume demands for payment. If there is no discharge of student loans, payment must resume.

If you or someone you know is having difficulty paying their student loans, we may be able to help.

Contact King and King today for a free bankruptcy consultation 404-524-6400.

How to Get Credit After Filing for Bankruptcy

How to Get Credit After Filing for Bankruptcy

King and King Bankruptcy Attorneys 11/27/2012

During our bankruptcy consultations, one of the biggest worries our clients have is that they’ll never get credit again—or at least not for the 10 years during which bankruptcy shows on their credit report. Our clients are usually surprised to hear it won’t be as difficult as they fear. Bankruptcy will affect your credit score in the beginning, but you will be able to get credit again and rebuild your score. Bankruptcy actually helps your chances of getting credit if you had high credit card debt before the bankruptcy and collections or charge-offs. Bankruptcy gives you a clean slate. 

Secured credit cards:

 A credit union or a bank may give you a secured credit card. This is where you give the bank funds to “secure” the credit on the card. Some lenders might want you to deposit the full amount of the credit limit (e.g., a $500 deposit in exchange for a card with a $500 limit), whereas others might only require you to secure a certain percentage of the limit with a deposit (e.g., a $250 deposit in exchange for a card with a $500 limit).

Credit cards:

Many people get offers for credit cards right after bankruptcy. There are a number of companies that specialize in credit cards after bankruptcy because they can get higher interest rates or fees. Make sure you understand the terms of these offers and take the best one. 

Car loans:

Much like credit cards, there are auto lenders out there who will give you a car loan right after bankruptcy, usually at a higher interest rate. Another option is to get a co-signer for the loan. The lender may agree to refinance it later if you make regular on-time payments for a period of time.

After about six to twelve months of on-time payments toward new accounts, even small ones, your credit will start to improve. From there, getting more credit should get even easier. Some people who work diligently toward rebuilding credit can even buy a house within just a few years after bankruptcy. 

If you have questions about your credit after a bankruptcy, contact King and King at 404-524-6400 for a free consultation. 

Medical Debt and Chapter 7 Bankruptcy

Medical Debt and Chapter 7 Bankruptcy              

King and King bankruptcy attorneys, Saturday, 24 November 2012

Serious illness can happen to anyone at any time. In addition to medical bills, prolonged illness or injury can interfere with your ability to work. Missed work equates to less income, which additionally complicates the financial battle.

Medical problems and the debt that results from them are an extremely common cause for filing Chapter 7. 

Fortunately, there are ways to deal with medical debt. If you are overwhelmed with expenses, Chapter 7 bankruptcy is one possible road to security. Chapter 7 bankruptcy is a form of personal bankruptcy, which clears out unsecured debts. The process generally moves fairly quickly. The average case takes as little as four months from the time of filing.

Bankruptcy courts classify medical debt as unsecured debt, which means that it may be discharged within the bankruptcy process. An unsecured debt is one that is not protected by a physical item of property as collateral. If you are unable make payments on unsecured debts, creditors cannot generally recover any items. However, they may be able to sue you and garnish your wages.

Within the Chapter 7 process, all eligible debts included in the filing should be discharged -- any legal obligation to repay is extinguished.

If you are overwhelmed by serious medical debt, contact King and King today. Our bankruptcy attorneys can help you sort through your finances and construct a solid debt-reducing plan. Call us at 404-524-6400.

Common Questions about Chapter 13 Bankruptcy

Common Questions about Chapter 13 Bankruptcy

King and King Bankruptcy Attorneys 11/14/12

Managing money isn't always easy, and some people need more than one chance to get it right. If you’re living a lifestyle with a few comforts you don’t want to give up, or make more money than what income limits allow for filing Chapter 7 bankruptcy, you might be considering the possibility of Chapter 13 bankruptcy in order to give you a new start and help you get a handle on your finances.

What’s the difference between debt consolidation and Chapter 13?

At first glance, Chapter 13 bankruptcy can sound a lot like non-bankruptcy debt consolidation. The two are similar but have several key differences. With a Chapter 13 bankruptcy, creditors are court-ordered to comply with the terms of the debt settlement, while they have the option of declining under a standard debt consolidation plan. Also, with Chapter 13, the interest on certain types of debts stops accruing, so you can pay off what you owe without chasing down interest.  A Chapter 13 has an “automatic stay” which prevents creditors from attempting to collect a debt outside of the bankruptcy process.  Debt consolidation has no such protection.

Will I lose my assets or investments when I file Chapter 13?

Protecting assets and investments is one of the reasons why many people choose to file Chapter 13.  Speak with a qualified bankruptcy attorney to learn more about what assets you can protect in your bankruptcy.

Is Chapter 13 mainly for those who don’t meet Chapter 7 Guidelines?

While it is common for the Chapter 13 option to be presented to those who don’t pass the “means test” required for Chapter 7, there are many cases when even those with lower or moderate incomes may prefer Chapter 13 over Chapter 7.  Chapter 13 is a convenient reorganization of all of a debtor’s debts.  Also, many debtors can take advantage of “cram down” in Chapter 13, where interest rates and total amounts owed to certain creditors can be drastically reduced. 

Getting New Credit

When you file a Chapter 13 bankruptcy, your income levels are assessed to determine how much you can affordably pay towards your debts. For this reason, it is rare that new debt can be incurred during the 3-5 year repayment period. Any new credit you might get not only needs to be approved by the potential creditor, but also by Bankruptcy Court. Getting new credit is rare but possible during a Chapter 13 bankruptcy.

Every bankruptcy plan handled by King and King is customized for each individual case to obtain the very best results possible.  Contact us at 404-524-6400 for a free consultation today.

Which comes first — bankruptcy or divorce?

Should you file for bankruptcy before or after your divorce is finalized?

Which should you pursue first — bankruptcy or divorce?

This is an important decision and should in most cases be made BEFORE your divorce is complete. When one spouse files for consumer bankruptcy, it often sends the other spouse into bankruptcy too.

After divorce, domestic support obligations such as alimony and child support are not dischargeable during bankruptcy. Our attorneys can explain facts and legal options that will help you to make sound decisions about your future.

Your decision to pursue a consumer bankruptcy before, during or after divorce can be positively influenced by the guidance of experienced bankruptcy attorney. King and King as served bankruptcy clients in Atlanta and the surrounding areas with quality, full-service representation for Chapter 7 and Chapter 13 debt relief strategy; including the role that divorce can play in your decision.

Contact our bankruptcy offices today at 404-524-6400 for your free confidential consultation.

Can Filing Bankruptcy Dismiss Back Taxes?

Can Filing Bankruptcy Dismiss Back Taxes?

Taxes and Bankruptcy - 

Usually people associate bankruptcy with credit card, loan, or mortgage debt not knowing or realizing bankruptcy can also be used to eliminate liability for unpaid taxes.

The U. S. Bankruptcy Code permits discharge of certain back taxes, but several conditions do apply. Generally most business taxes are not dischargeable. People who qualify for tax discharge typically do so by filing either a Chapter 7 or Chapter 13 bankruptcy.  It is best to consult with an experienced professional to assess your unique situation. A qualified bankruptcy attorney can help determine whether you are eligible to obtain an IRS tax relief through bankruptcy.

Call King and King bankruptcy attorneys for a free consultation today. 404-524-6400

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Saving Your Home From Foreclosure

Saving Your Home From Foreclosure

Home foreclosure can be one of the most frightening financial challenges to face. Losing your home cannot only leave you without a place to live, but can also destroy all the hard work you’ve put into your home. Owning a home is an important investment, and putting money towards a mortgage instead of rent can mean a more secure future. However, if the payments become too much and you begin to fall behind, then the bank can threaten to foreclose on your home.

How Foreclosure Works

Foreclosure means that the bank will take possession of your house and sell it. If you are faced with the prospect of foreclosure or if you have already received a foreclosure statement from your lending company, one option you have is to file for bankruptcy. This may be something that not only saves your home, but also gives you a clean slate to create a more stable future.

Chapter 13 Bankruptcy and Foreclosure

Many people file for Chapter 13 bankruptcy specifically to stop foreclosure.

In most cases, an automatic stay is entered as soon as a Chapter 13 bankruptcy petition is filed. The automatic stay will temporarily stop foreclosure, along with all other collection action, regardless of the stage of the foreclosure proceedings.

With the automatic stay in place, the debtor and their attorney have the breathing room to work out a Chapter 13 repayment plan.

Professional Help is Available

Taking the leap and filing for bankruptcy can be scary but, in the end, it can release you from a world of stress and financial pressure. You don’t have to lose your home or succumb to foreclosure. There are options available and King and King bankruptcy attorneys can help. Contact at our AtlantaBankruptcy Office today at 404-524-6400 for a free initial consultation. 

Can I Keep My Car In Bankruptcy?

Can I Keep My Car In Bankruptcy?

Posted on October 24, 2012  King and King Bankruptcy Attorneys

With the economy in trouble like it has been for the past few years, you have probably heard or even know people that have pursued bankruptcy to ease the financial burden of an underwater mortgage (owing more on a mortgage than it is actually worth).

A similar question that is becoming more and more common is whether or not people can use bankruptcy as a release for the financial burden of an underwater auto loan. While each situation is considered unique and therefore could provide different outcomes, if you are facing an underwater car loan there are a few potential bankruptcy options that you can explore with your bankruptcy attorney.

Chapter 7 Bankruptcies

Chapter 7 bankruptcies provide several options for debt relief, including some that may allow you to keep your car. As always, your options will depend on your specific situation. Here are a few options under Chapter 7:

Surrender the vehicle

Surrendering your car is an option to reduce the burden of auto payments and insurance. However, this is not a viable option for most people since they need their transportation to get to and from work.

Redeem the loan

Through judicial approval, you may be able to reduce your car debt to the fair market value. In other words, if your loan balance is $8,000 and your car is only worth $4,000 you may be able to reduce the balance of the loan by $4,000. Depending on your situation, your payment requirements may be either monthly payments or a lump sum payment. There is often a tradeoff of higher interest charges, so it’s important to run the numbers to see if a redemption will help you.

Chapter 13 Bankruptcies

In Chapter 13 bankruptcies, your options are different. You may choose to keep the car and have it rolled into your bankruptcy, where you will pay some portion–often a fraction–of the balance as part of your payment plan. If you’ve owned your car for more than two and a half years, you may qualify to have your outstanding balance adjusted to Fair Market Value and stretch the payments out over the life of the bankruptcy. In some cases, you may be able to keep your car and pay off your debt for a very modest monthly payment.

As you can tell, there are many choices in bankruptcy when it comes to your auto loan. If you want to keep your car, it’s important to get expert advice. If you are exploring the possibility of filing for bankruptcy, schedule a free consultation to learn about your options with an Atlanta, Georgia Bankruptcy Attorney, by calling 404-524-6400. Contact us today.

A Few Common Bankruptcy Myths

Dispelling A Few Common Bankruptcy Myths

Posted on October 16, 2012  King and King Bankruptcy Attorneys

If you are considering filing for bankruptcy, chances are you have received information from many different sources. Some of it is genuine information, some is opinion, and some is simply myth. It’s important that you have accurate information about bankruptcy, not falsehoods. Here is a list of some common bankruptcy myths and why they are not reality. We hope this will clear things up for you as you make decisions about your financial future.

Common Myths About Bankruptcy in Georgia

Myth: People who file bankruptcy lose everything.

Reality: In many cases, your bankruptcy attorney is able to help you keep important possessions. Bankruptcy law contains many "exemptions" which are designed to help people keep their house, car, retirement accounts, furniture and other property. Remember, bankruptcy is designed to help you, not hurt you.

Myth: Bankruptcy will destroy your credit.

Reality: In truth, if you are in a position where bankruptcy is an option, your credit may already be heavily damaged. While a bankruptcy filing does show up on your credit report for up to 10 years, your credit is not impacted that long. In fact, the fresh start bankruptcy provides allows you to rebuild credit rather quickly.

Myth: It’s hard to file for bankruptcy.

Reality: It is true that the bankruptcy laws changed in 2005, but the vast majority of people who qualified for Chapter 7 before the changes will still qualify today. If for some reason you do not qualify for Chapter 7, there would be nothing preventing you from filing for Chapter 13instead.

Myth: Filing bankruptcy prevents you from getting credit in the future.

Reality: By lowering your debt-to-income ratio, bankruptcy makes you a more attractive candidate for loans. In fact, many filers are able to secure a mortgage only a few years after their bankruptcy is complete. Creditors like to see that you are taking control of your finances. Bankruptcy is evidence of that.

Myth: Newspapers publish the names of people who file for bankruptcy.

Reality: Unless you are a celebrity, your bankruptcy is not really an item of public interest. Newspapers will rarely, if ever, publish the names of people who seek bankruptcy protection.

We hope you have a few more of the facts.  Have more questions? Schedule a free consultation with an experienced Atlanta, Georgia bankruptcy attorney; please contact King and King at 404-524-6400 today.

Wage Garnishment and Bankruptcy

Wage Garnishment and Bankruptcy

Posted on October 12, 2012  King and King Bankruptcy Attorneys

It’s a creditor’s job to collect on a debt. One of the most effective collection methods is wage garnishment. By garnishing wages, the creditor does not have to be concerned with the debtor’s willingness to send payments or pay the debt in full. The money is simply taken directly out of the debtor’s paychecks. Typically, a lender will not resort to wage garnishment until other collection methods have failed and the debtor has demonstrated an unwillingness to pay.

When a creditor threatens to garnish wages, a debtor often feels little can be done to prevent it. Working out a payment plan is one way to convince the creditor to refrain from garnishing wages.

Filing for bankruptcy is another option a debtor has to take control of debt. Filing for bankruptcy will also immediately stop wage garnishment and will completely prevent the creditor from garnishing a debtor’s wages.

Is Wage Garnishment the Best Option for Creditors?

According to a recent study, states that do not allow or put drastic limitations on a creditor’s ability to garnish the wages of debtors have lower rates bankruptcy filings; 42 percent lower according to the study. A creditor may be less likely to collect on a debt if a debtor files for bankruptcy.

However, the current economic recession has put creditors in the position of actively pursuing wage garnishment as a method of collecting on the debt owed. The recession has made it harder for debtors to repay debts and wage garnishment puts a creditor in first position to collect on a debt when there are multiple creditors.

If you are in debt and being threatened with wage garnishment contact an experienced Atlanta, Georgia bankruptcy attorney. King and King bankruptcy attorneys can help you understand all of your options to prevent wage garnishment and other collection efforts while helping you understand your options for taking control of your debt. Call us today404-524-6400

What Can You Expect After Bankruptcy?

What Can I Expect After Bankruptcy?

King and King Bankruptcy Attorneys 10/3/2012

If you have yet to file for bankruptcy but are seriously considering it, you may be asking yourself,  "Is there life after bankruptcy? Is there life after debt?" The answer to both questions is yes.

We want your bankruptcy efforts to succeed. We want to see your family restored to the sound economic footing you once had. Don't be afraid to ask for help. Contacting an experienced bankruptcy attorney for a consultation is the first step.

Mortgage payments, credit card debts, unforeseen medical bills: these concerns don't have to be forever. You can deal with them now. That is why federal bankruptcy protections are on the books — to help those who, often through no fault of their own, have fallen upon hard times.

On the other side of your Chapter 7 or Chapter 13 bankruptcyfiling, you can look forward to:

• An end to stress over your current financial problems

• Relief of debt pressures

• Credit Repair

• Eligibility for mortgage and motor vehicle loans

• An end to Collection Abuse

• A stop to repossession of personal items

• Prevention of wage garnishment

• Lifestyle and budget adjustments

• A clearer income tax picture

• A fresh start towards a brighter future

Bankruptcy attorneys have made a positive difference in many lives. We urge you to take action despite the emergence of many destructive, deceptive bankruptcy myths.

You will come away from your free initial consultation with a definite sense of your bankruptcy options. We are dedicated to your financial peace of mind. Contact King and King for a free consultation at 404-524-6400 today.

Chapter 13 Bankruptcy Can Help You Manage Your Debt

Chapter 13 Bankruptcy Can Help You Manage Your Debt

King and King Bankruptcy Attorneys 9/26/2012

In the past, bankruptcy was viewed negatively by most.  Today, however, the American Bankruptcy Institute reports that bankruptcy was unavoidable for nearly 1.5 million individuals and more than 35,000 businesses nationwide. Georgia residents considering filing for bankruptcy relief should know that attitudes have shifted, and many view bankruptcy as a solution to ease the hardship of debt.

Bankruptcy is a legal process designed to eliminate overwhelming debts in a variety of ways. One form of bankruptcy is Chapter 13, which is commonly referred to as "reorganization" or "wage-earner" bankruptcy.  Chapter13 bankruptcy allows filers to clear a large share of their debt through a repayment plan.

The repayment plan that borrowers enter into establishes the terms under which the filer will repay their debt. The repayment term typically runs between three and five years, and a trustee assigned by the court oversees the repayment process. What debt is included in the final repayment plan requires a collaborative process, which includes both the courts and the creditors. Throughout the process, creditors are allowed to comment on the terms of plan.

In the end, the court must approve the final plan. Once the plan has been approved, the trustee has been assigned and the terms of the repayment plan have been established, the court discharges remaining debt that falls outside the terms of the final agreement. For some, a little debt reorganization is all the help they need to get back on track. It doesn't take much to fall behind. Fortunately, with a little help, it is possible to stay on track to find a fresh start. There are options available, even when the situation is troubling. For a free consultation with a professional bankruptcy attorney call King and King at 404-524-6400

Source: CBS News, "Number of individual bankruptcy filings drop," Ray Martin, Sep. 11, 2012

Can a bank foreclose on your property after bankruptcy?

Can a bank foreclose on your property after bankruptcy?

King and King Bankruptcy 9/21/2012

It’s true in most cases that bankruptcy filing will stop a foreclosure, as long as a foreclosure sale has not taken place. However, many debtors wonder if their bank can come back after the bankruptcy case is closed and initiate foreclosure proceedings once again. Let’s take a closer look at this question.

Fact: the automatic stay imposed through a bankruptcy filing buys a debtor time in which to review and reorganize all of their debts. No collection efforts may take place while the stay is in effect, and that includes foreclosure proceedings. However, in some cases a lender may petition the court to have the stay lifted so that it may reinstate a foreclosure where it left off in order to take the property back.

In order to lift the stay, the lender must show that the homeowner is not current on the mortgage payments.  As long as you stay current on your mortgage payments and property taxes while in bankruptcy, you are not at risk.

Nevertheless, the lender may wait until the bankruptcy case is closed to start (or continue) foreclosure proceedings. If a debtor falls behind on payments after a bankruptcy is concluded, a lender may initiate foreclosure proceedings on the property.

If you have questions about whether a bankruptcy would be appropriate to save your home from foreclosure, an experienced attorney can advise you. Call King and King in Atlanta, Georgia for a free consultation today--404-524-6400.

Chapter 7 vs. Chapter 13 Bankruptcy

Chapter 7 vs. Chapter 13 Bankruptcy

September 17, 2012 by King and King Bankruptcy Attorneys

The two most commonly used types of bankruptcy are called Chapter7 bankruptcy and Chapter 13 bankruptcy. The one that you will file depends on your situation. The first is Chapter 7 bankruptcy.

In Chapter 7 bankruptcy, any unexempt property will be liquidated and turned over to a trustee. The trustee converts it to cash and then pays your creditors.  Do not worry—exemptions are generous and we are able to protect all of our clients’ property in almost every case.

You will most likely be advised to file Chapter 7 bankruptcy if you do not have enough disposable income to pay your obligations via a payment plan or if you are unemployed.

Chapter 7 Bankruptcy Advantages

Chapter 7 bankruptcy is a straightforward process. After the liquidation process, the trustee is expected to process your discharge from debt. After the discharge, your creditors do not have any claim on your future earnings or properties and possessions, so you truly get a fresh start.

Credit Impact

Chapter 7 bankruptcy’s major credit impact is that it lowers your credit score, and it stays in your record for up to 10 years. However, you should be able to rebuild your credit immediately after discharge and in most cases have a credit score higher than before bankruptcy within just a few years.

Chapter 13 Bankruptcy:

This type of bankruptcy is available to individuals with disposable income. With a Chapter 13 bankruptcy, your creditors will work with your bankruptcy attorney, your Chapter 13 Trustee, and the Bankruptcy Court to restructure your debt and create a repayment plan. These payments can last 3 to 5 years, depending on the agreed plan.

Chapter 13 Bankruptcy Advantages

The biggest advantage of Chapter 13 is that you get to keep your assets, including properties. This can also be done with Chapter 7 using exemptions.  Chapter 13 can also stop the foreclosure on your home, repossession of your car, wage garnishment, and it gives you more time to pay off your debt.

It is best to consult a bankruptcy attorney before deciding which type of bankruptcy is the best option for you. Call King and KingBankruptcy Attorneys in Atlanta, Georgia for a free consultation today, 404-524-6400.

When Facing Foreclosure Be Aware Of Mortgage Relief Scams

When Facing Foreclosure Be Aware Of Mortgage Relief Scams

Bankruptcy and Foreclosure – Saving Your Home in Bankruptcy

King and King Bankruptcy Attorneys 9/7/2012 

The thought of losing your home is a frightening one, and it can make some solutions that would normally seem too good to be true seem like a good idea. Today Fox News reported on six Mortgage Relief Scams that anyone facing foreclosure should be aware of.

1. Scammers posing as official counselors
2. Offering to perform a mortgage audit
3. Money-back guarantees
4. Advising you to stop contacting your lender
5. Misrepresented attorneys general settlement
6. Mass joinder scam

Read the full article here

Chapter 13 bankruptcy may be able to save your home. Because of the complexity and recent major changes to the law, consult competent legal counsel before you file any chapter of bankruptcy.  A good attorney can review your employment status and credit as well as personal circumstances to help you pursue a debt relief solution that is appropriate for your situation and goals.  Furthermore, if a deal seems too good to be true, have an attorney look at it before you make a costly commitment.  

King and King in Atlanta GA can help; call today 404-524-6400

Bankruptcy and Your Car Loan

                

Bankruptcy and Auto Loans – Saving Your Car in Bankruptcy

King and King Bankruptcy Attorneys 8/30/2012

If your vehicle is worth less than you owe, or you are paying excessive interest, Chapter 13 bankruptcy can reduce your balance, cut your interest rate, and slash your payment. A “cram down” of an auto loan is a major benefit available only in Chapter 13 bankruptcy.

Bad car loans can be financially devastating. As a bankruptcy firm in Atlanta, we have seen clients with auto loans nearly two times the value of their vehicles and at higher than 20% interest. However, it is not only debtors with egregiously bad loans who benefit from Chapter 13 cram downs. Unexpected depreciation of a vehicle’s value and a modestly high interest rate will quickly place almost anyone underwater on a car loan.

Bankruptcy and the Balance on an Auto Loan

Cramming down your car loan balance in Chapter 13 reduces the balance to the vehicle’s fair market value. This new lower amount is paid through your Chapter 13 plan. Although a creditor may object to the value that you propose, courts will generally accept the average Bluebook value.  Any remaining balance becomes an unsecured debt like your credit cards, medical bills, etc.  Because most Chapter 13 debtors pay only a small portion of their unsecured debt, cramming down the balance can save you thousands of dollars.

Time is a Factor

To be eligible to cram down the balance on an auto loan, you must have purchased the vehicle at least 910 days (a little over 30 months) from the date that you filed your Chapter 13 bankruptcy. Even if your car was purchased within 910 days of filing, most clients are able to lower their interest rate to a much lower rate than the one the financing company offered them.  Many of our clients are able to save thousands of dollars of interest this way.

Speaking with an experienced bankruptcy firm such as King and King, serving Atlanta for over 30 years, is the first step to your financial freedom. Call us today for a free consultation 404-524-6400

What can I keep when I File Bankruptcy?

What can I keep when I File Bankruptcy?

The Myth is You Lose Everything When You File Bankruptcy

The majority of people we meet with believe that if they file bankruptcy they will have to give up their home, cars, furniture, basically everything they own. In fact most people can’t understand how someone could file bankruptcy and keep anything. It pays to be informed, this is how bankruptcy works.

Bankruptcy Options Are Flexible and You Can Usually Keep All Your Assets

What you can keep in a bankruptcy case depends in part on which chapter is filed, and what exemptions (protections) are available under applicable law.  In a Chapter 13bankruptcy or Chapter 11 reorganization bankruptcy case, you can keep all your assets, but you may have to pay out a certain amount to your creditors through a “plan” of repayment to cover the value of any non-exempt assets.

In a most Chapter 7 bankruptcy cases, you get to keep any assets that are exempt.   In the vast majority of cases, you get to keep everything.  Why?  Because a experienced bankruptcy attorney is not going to file a Chapter 7 case if you’re likely to lose significant assets by doing so.

Start With A Consultation

The best thing to do if you have debts you cannot afford to pay is to have a consultation with a bankruptcy attorney to explore your options.  The worst thing to do is nothing, or to assume you know enough about the law and decide there’s no reason to explore your options. Call King and King for a free consultation today 404-524-6400.

Bankruptcy Can Stop A Wage Garnishment

Timing Is Everything when Filing Bankruptcy To Stop A Wage Garnishment

Can filing bankruptcy stop a wage garnishment?  As a Atlanta Georgia bankruptcy firm specializing in Chapter 7 and Chapter 13 cases, this is a question most of our clients ask whenever a creditor has successfully obtained a court judgment against them. After a successful court judgment against a debtor, wage garnishment usually follows. Debtors usually think that an immediate bankruptcy filing is a good idea to stop the garnishment of their wages.

Sections of the Bankruptcy Code provide that a debtor may recover property — such as wages — that have been involuntarily taken from the debtor during the 90 days preceding his bankruptcy filing. These sections are enacted to allow debtors to recover money or property.

Being a bankruptcy firm who has served Atlanta for over 30 years, we advise our clients to take care in deciding on when to file for bankruptcy in order to stop a wage garnishment in Georgia. Timing is everything in filing for bankruptcy to recover garnished wages. If the garnished wages total less than a certain amount they can’t be recovered.   

Filing for bankruptcy is similar to having a well thought out business strategy. You need the help of a specialist to make use of the law to your advantage. The lawyers at The Law Office of King and King specialize in Chapter 7 and Chapter 13 cases and will help you obtain a fresh start. Please call our office at 404-524-6400 for a free-no hassle consultation. 

Benefits of Filing for Chapter 13 Bankruptcy

Benefits of Filing for Chapter 13 Bankruptcy

Posted on Aug 1st, 2012 King and King Bankruptcy Attorneys, Atlanta GA

When deciding to file for bankruptcy, you might think of filing for chapter 7 first. This can be for many reasons; one of the most alluring draws of chapter 7 bankruptcy might be the ability to discharge all of your debts. This can be tempting – a fresh start. However, there are numerous benefits to filing for Chapter 13, and in many cases it may be a better option.

Four benefits of filing for Chapter 13:

        You have the opportunity to save your home. By filing for Chapter 13, you will put a halt to all foreclosure proceedings and will be able to come up with a repayment plan that will best suit you. You will also be able to structure delinquent mortgage payments so that by the end of the bankruptcy, you will be caught up.

      Individuals can schedule secured debt payments over three to five years. By coming up with a repayment plan for all secured debts, debtors will be able to have a solid battle plan moving forward. Beyond that, debtors who do this and stretch their payments over the repayment plan may find that they have lower payments that are more financially feasible to pay off.

     Creditors will stop calling. One great source of relief to many debtors is that during the course of their bankruptcy, they will not be required at any point to interact with their creditors. Instead, they will make all monthly payments in one solid lump to their trustee who will then make the payments. You then only have to focus on making one payment and only need to interact with the trustee.

You are not at risk of losing any of your property. When you file for Chapter 7, your property is vulnerable to being liquidated to satisfy the debts that you owe to all of your creditors. This, however, is not the case in Chapter 13 bankruptcy. In fact, it is quite the opposite with debtors able to keep all of their property and coming up with a repayment plan that allows for them to make payments over the course of several years instead.

One of the most important decisions you can make is who you choose to counsel you during your bankruptcy proceedings.

Call King and King in Atlanta Georgia for experienced help today.  404-524-6400

Seven Common Chapter 7 Bankruptcy Myths

Seven Common Chapter 7 Bankruptcy Myths

King and King Bankruptcy Attorneys posted on Tuesday, July 19, 2012

Chapter 7 bankruptcy allows people to discharge their debt. The process is called asset liquidation because the assets of the individuals can be sold to pay back creditors. However, numerous protections remain in place to prevent the loss of all assets, especially those necessary to enable the individual to start a financially successful future. Although most individuals qualify for this, some do not take advantage of it because of the numerous myths about the process. Those who are facing financially difficult times, regardless of why that is may wish to contact an attorney to discuss their options.

Here are a few common Myths.

In Chapter 7 bankruptcy, individuals request the court to grant them a discharge, which means they no longer have to pay back the funds included within the filing. When you go bankrupt, there are consequences. Yet for most, this is the best way to start a strong financial future. Don’t believe these common myths.

1. You will lose your home. Under state and federal law, some assets have protection, depending on the value. For those with a high amount of equity in their home, it is possible the trustee will force the sale, but this is rare in most cases and finding a good attorney will help.

2. Chapter 7, chapter 11, or chapter 13 will work for me. Not true, speaking to a qualified professional can help you figure out what type of bankruptcy you need to file.

3. All types of debt qualify. That is not the case because federal income tax debt, student loans, and child support and alimony are non-dischargeable. These will remain after you file.

4. It ruins your credit forever. Not true, you can rebuild your credit over time. Additionally, those who are unable to meet their financial obligations right now may be better off filing in the long-term, especially if they cannot pay off their debt within the next three to five years.

5. Everyone will know. Again, it is a public record, but what is different here is that unless you tell people about it or they follow court records closely, they will not know.

6. You will lose your family collectibles. Most states have specific allowances for various types of assets to protect them. As long as the value remains under the state-appointed threshold, you should be protected.

7. It takes too long. Most cases process within two to three months. You could be debt free by that time.

Chapter 7 bankruptcy is an opportunity to finally get the financial help you need. Do not put off the opportunity that this could provide for you. Instead, take steps to move towards this process by speaking to an attorney about your situation.

When it comes to filing for Chapter 7 bankruptcy Atlanta residents know that they need an experienced attorney on their side to get the best results. Visit the following for more information about your options: http://kingandkingattorneys.com .

Rebuilding Credit After Bankruptcy

Rebuilding After Bankruptcy

King and King Bankruptcy Attorneys

July 12, 2012

Can you rebuild your credit after bankruptcy?

This is a question most of our clients ask. One of the facts of bankruptcy is that although it initially has a negative impact on your credit, it can actually improve your credit for a very logical reason: After you file a Chapter 7 bankruptcy, your debt-to-income ratio dramatically improves because you have little to no old debt and more money available to pay on new debt.

When rebuilding credit the length and type of your employment can make a difference - the longer you have worked at the same job, the easier it will be to obtain new credit.

However, credit rebuilding steps do not end with your employment history.

First, keep in mind why you filed bankruptcy in the first place. If it came because of  a job loss, illness or divorce, you are a good candidate for moving forward and establishing new credit. Whatever the reason, be sure to address the issues that led to filing for bankruptcy.

The next step may be to apply for a secured credit card. With this, you deposit money with a lender as security and your credit limit is usually the amount of the deposit. This is different than a debit card, which has no element of credit lending or credit history rebuilding record.

Also, pay your existing debt, such as installment loans you may still have, on time. This is especially crucial with secured loans such as cars or mortgages. Each month you pay on time, it is reported to the credit bureaus and helps strengthen your score.

After you have a secured credit card, you may want to apply for a store card from a gas company or department store. Using your revolving credit lightly, but regularly can help restore your credit score.

The mix of credit cards, installment loans and store cards used and paid regularly on time can be a fast track to restoring your credit rating after bankruptcy. It can be accomplished in as little as two years in conjunction with a good employment history.

If you are thinking about bankruptcy, we can help. King and King Bankruptcy Attorneys 404-524-6400

How do you know when it's time to declare bankruptcy?

How do you know when it's time to declare bankruptcy?

King and King Bankruptcy Attorneys
July 5, 2012

As the ongoing housing crisis in Georgia and the country continues to influence our day to day lives, one of the ripple effects is the desperate financial situation of homeowners who continue to struggle with debt, sometimes even years after losing their homes to foreclosure.

Honest people who want to make good on their debts are increasingly overwhelmed as lenders continue to pursue deficiencies from years past. Attempting to make even the minimum payments on a sea of debt can wipe out retirement savings and max out credit cards. Then, many find it impossible to rebuild their financial lives.

It takes only a small shift in circumstance to make repayment impossible, loss of employment, divorce, a health or housing crisis. Remaining in denial about the futility of repaying all debt is stressful and takes a toll on relationships, family and health. When your liabilities are excessive, and your assets are minimal, if not gone, it is time to take a rational look at an often emotional, decision: Should you declare personal bankruptcy?

In today’s economy, personal bankruptcy filings are no longer seen as the end of your credit worthiness. These filings have become an acceptable solution to help you organize your debt, and free you from years and years of making minimum payments that will never go away. If you qualify, filing for Chapter 7 or Chapter 13 bankruptcy may be an effective way to restore your financial future and rebuild your dreams.

If you are considering bankruptcy the most important thing to do is to find a reputable lawyer to advise you.

For instance, in a Chapter 7 bankruptcy filing, you must meet a “means test” which will look at your income and debt to determine your true need for relief. These guidelines vary from state to state.

If you have tried to meet your obligations, but have been battered by economic forces beyond your control, the decision to take action and take control of your finances can be the beginning of a stable financial future.

If you need help, call King and King bankruptcy attorneys at 404-921-3790 today.

Facing financial hardships? Bankruptcy is an option.

If you are facing financial hardships bankruptcy is an option.

King and King Bankruptcy Attorneys posted  on Tuesday, June 19, 2012

If you are currently facing some unexpected financial challenges that several months ago or maybe even a year ago you couldn’t see coming, don't automatically discount bankruptcy protection as a possible option for resolving your problems.

Atlanta residents who don't understand Chapter 7 or Chapter13 bankruptcy or who have never had to worry about finances often assume that only irresponsible people file for bankruptcy in Georgia. However, this is generally not the case.

Atlanta consumers file for bankruptcy protection for many reasons including the loss of a job, a recent divorce or an illness that has resulted in major medical expenses. To say that these individuals were irresponsible is heartless. People face life-changing events every day that they can't necessarily plan for.

Although some folks do try to take advantage of bankruptcy laws in order to discharge debt they simply don't want to repay, these laws were also enacted to help prevent this type of abuse. For example, those who file bankruptcy protection can certainly have some of their debts discharged, but there are other types of debt that consumers could still be responsible for, even after bankruptcy. Some types of debts that cannot be discharged include student loan debt, tax debt and alimony or child support payments.

Credit card debt may be discharged, but this does not mean that consumers are free to start charging numerous purchases on their credit cards before choosing to file for bankruptcy protection. This type of activity could be considered fraud and courts will not discharge this type of debt.

Even if consumers do understand that bankruptcy may be a great solution to their financial troubles, some still choose not to file bankruptcy because they are worried about ruining their credit. The truth is bankruptcy will affect your credit score, but this is not permanent. In many cases, folks are able to rebuild their credit so that they can borrow from lenders in the future.

Bankruptcy may not be a solution for every consumer who is experiencing financial problems. If you have questions about whether or not bankruptcy is right for you, you may want to consider seeking guidance from anattorney in order to make sure that you are making the right decision for you and your family.

Source: USA News & World Report, "5 Bankruptcy Myths Debunked," Susan Johnston, May 14, 2012

http://money.usnews.com/money/personal-finance/articles/2012/05/14/5-bankruptcy-myths-debunked