What is a Chapter 7 Discharge

When discussing filing for Chapter 7 bankruptcy, you may hear the term discharge being used frequently. While most of your debts will be affected by the Chapter 7 discharge, some may not be.

What Qualifies?

Most debts can be discharged through Chapter 7 bankruptcy. Most people already know that credit cards, medical bills and collection accounts will receive a discharge under Chapter 7.  You can also get a Chapter 7 Discharge on past due utility bills or money owed to an old landlord.  With all of these items qualifying for a discharge, you may wonder what does not qualify.

Non-Qualifying Items.

Although some attorney fees may be able to be discharged, those related to alimony or child support usually do not go away with a Chapter 7 Discharge. You also may not be able to receive a discharge for student loans in most circumstances.  If you obtained a loan through fraud or misrepresentation (dishonesty on an application, for example), you may not get rid of that debt.

The bankruptcy discharge does not, generally, get rid of liens on property.  If you were sued, that may be a lien and you should talk to your bankruptcy attorney about it.

 

What does the discharge mean?

Once you have received your discharge, you are no longer legally responsible to pay those creditors. Creditors are not allowed to attempt to collect on the debts in which you get a bankruptcy discharge.   The amount of time it takes to receive a full discharge of your debt will depend on the length of your bankruptcy proceedings, but you will usually get a discharge in three or four months after the case was filed.

 

Sean C. Paul is licensed to practice law in the State of Missouri. His practice is located in downtown Kansas City. He can help you with your Chapter 7 or Chapter 13 Bankruptcy case. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

Build Credit!

So you are done with your bankruptcy, right?  What next?

Many of you have asked me how to build credit after  your case.  At the time I told you we’d worry about that later.  Your priority at the time was to GET OUT OF DEBT.  Now that you’ve accomplished that, you need to build credit and retake your finances.

Your credit score can have a major impact on the cost of loans and credit cards.  The difference between a 760 credit score and a 660 credit score might be thousands of dollars in interest over the term of a loan.  That’s WAY too much!

Get a small credit card to rebuild credit.  It might have to be a secured credit card or a low-balance card.  You must start somewhere.  From there use that card on minor purchases such as gas and groceries and pay it in full every month!  Pay on time so it helps you rebuild your credit.

Remember – a small $100 credit card will help your credit just as much as a $10,000 loan.  Just make the payments on time!  It does not have to be difficult to build credit.

Please contact me today to discuss how to build credit and make your life better.  314-827-4027.

Sean C. Paul is licensed to practice law in the State of Missouri. His practice is located in downtown Kansas City and in St. Louis. He can help you with your Chapter 7 or Chapter 13 Bankruptcy case.  Talk to Sean about how to build credit after bankruptcy. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

 

Inheriting Money during Bankruptcy

The most confusing and heartbreaking part of bankruptcy can occur if a loved one passes and you end up inheriting money or property in bankruptcy. It is confusing because it is a huge exception to the general rule that only assets that exist on the day of filing are part of your bankruptcy estate.  It is heartbreaking when you lose money you need to help you pay for a loved one’s funeral expenses.

Sean C. Paul, Missouri bankruptcy attorney, explains how inheriting money can affect your bankruptcy case.

 

The 180 Day Rule

This rule states that property inherited within one hundred and eighty (180) days of filing for either Chapter 7 or Chapter 13 bankruptcy, the property will be available to creditors. If you inherit the property after that period and have filed for Chapter 7, you may keep all of the inheritance. In Chapter 13 filing, the judge may still require you to pay this amount over for the benefit of creditors if you are still under your repayment plan, since the rule in a Chaptr 13 is that all disposable income must be used for creditors.

Call your bankruptcy attorney immediately if someone dies.  The rule is based on when you become entitled to inherit – NOT when you actually get the money.  So if someone dies within 180 days of your filing, you must turn the money over even if you don’t get it within 180 days (which you normally would not, anyway).  If you fail to turn it over, you might lose your discharge in bankruptcy.  You could even be prosecuted for not disclosing assets!  If you have any doubt at all, CALL YOUR MISSOURI BANKRUPTCY ATTORNEY!

 

Spouse

Your spouse’s money is not necessarily your money.  If you file bankruptcy, and your spouse does not, you probably won’t have to turn that money over.  However, DISCLOSE IT!  Talk to your Missouri Bankruptcy attorney to make sure what you need to disclose and what you need to turn over.

 

 

Sean C. Paul is licensed to practice law in the State of Missouri. His practice is located in south St. Louis County and downtown Kansas City, Missouri. He can help you with your Chapter 7 or Chapter 13 Bankruptcy case.  Sean can explain to you the rules about inheriting money or property in bankruptcy. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

 

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Source: Bankruptcy blog

Is all debt bad?  – An opinion from Missouri bankruptcy attorney Sean C. Paul

Firstly, let me state that it is generally best to stay debt free.  Even though I do firmly believe that there are “good” debts and “bad” debts.

Bad debts are obvious:  credit cards, medical bills, and collection accounts generally demonstrate an overall inability to afford routine expenses.  But even that can be overstated.  Even the most financially astute carry a balance sometimes in order to finance a temporary situation.  Pay it off quickly and it won’t become a problem.

What are “good” debts?  I like to think debts that help you gain leverage are good.  For example, if you buy into real estate, and that real estate increases in value over time, it is a net GAIN for you to have that asset.  Of course, if you can’t afford the payments on the debt, it can become a “bad” debt as well.

Are cars a good or bad debt?  Cars lose value quickly.  If you need to finance, you should do so at a low interest rate and a very short repayment period.  Again, if you can’t afford the payment, the debt will be even worse for you.  However, a short-term auto payment may help you gain leverage in that it will allow you to make more money getting to work.

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Source: Bankruptcy blog

Teach Your Teenager to Run from Debt with These 6 Tips

Unfortunately, sound financial advice is not taught in school during one’s formative years. It is up to the parents to talk to their teenagers about how credit works, how to be smart about their money, how to save, and the importance of staying out of debt.

With the six tips below you can teach your teen how to run from debt and make smart financial decisions that will greatly impact their future and quality of life.

Debt Prevention and Financial Advice for Teens

1.       Have them create a monthly expense report 

To teach your teenager about the importance of budgeting their money, sit down with them and show them the value of understanding where their money is going and coming in from. Start with their income and the various sources they may be getting money from whether it be allowance, their job or another revenue source. Next, use their bank statement (or written list of monthly purchases) to get an idea of how much money they are spending.

Separate the items that are must-haves (needs) from the wants to determine where their money is going. Once they get an understanding of how much they make versus how much they spend they’ll have an eye-opening experience that can lead to further discussions about money. This will be particularly helpful for parents who provide their teens with a credit card.

2.       Show them what compound interest can mean for savings 

Compound interest is when the interest that accrues on an amount of money accrues interest itself. This concept can be somewhat confusing to teens until you show them how saving a little bit of money now and gaining interest on it can mean a huge difference between them waiting until later in life to save and putting a more substantial amount away each month.

The below graph by J.P. Morgan Chase shows the benefit of saving early and is taken from an article that showcases the power of compound interest that may also be of interest to your teen. It shows three individual examples of investors who put away $5,000 annually and provides your teenager a good representation of how starting early can lead to tremendous gains in the long run. Teens tend to be amazed by million dollar amounts, and this graph shows that contributing just $5,000 a year (only $416 a month), can result in the seven-figure savings they may be interested in.

There are two more graphs on the aforementioned article that further emphasize the importance of starting to save early. Bankrate also has an investment goals calculator that you can use to plug in real life examples.

 

 

Resource: http://www.businessinsider.com/amazing-power-of-compound-interest-2014-7

3.       Teach them how electronics purchases using credit cards make no sense

Electronics. Teens are enamored by them and the latest-and-greatest devices seem to get more expensive each year. While there may not be an opportunity for you to discourage your teen from wanting the latest phone, you can teach them to be smart about their purchases.

Electronics, like smartphones, drop in price rapidly, so by putting cash away, their account balance will grow as the price for electronics goes down. When your teen uses their credit card to buy electronics up front (as the price is going down), the amount they are paying for them is increasing.

Show your teens what this means to their debt by using this credit calculator by Bankrate.com. For example, let’s take a common price for a new smartphone, $500. Assuming a credit card with 18 percent interest is used to pay for this device:

• with a minimum payment of $15
• your teen meets this minimum
• it would take your teen 47 months to pay off their debt
• accumulating another $200 in interest along the way

How’s that $700 phone going to be treating you in the four years it takes to pay it off, son?

4.       Use the thermometer visual for younger teens to teach them about savings

If you have a younger teen who wants to buy something nominal, it’s never too early to teach them about savings. A good visual representation is a picture of a big thermometer that you can put on your refrigerator with dollar amounts along the side of it that represent their savings.

As your teen saves money, they can fill the thermometer with color to represent how close they are to reaching their financial goal. This process helps them realize that saving takes dedication but comes with rewards.

5.       Show your teen the terms and conditions of credit card statements

Credit card companies’ terms and conditions are written by attorneys and are purposely worded in ways that are confusing and that protect the credit card companies. The word “may” is an important one in these documents and it basically translates to the credit card companies giving themselves permission to do anything they want whenever they want.

Communicate to your teen that these clauses mean that the credit card companies can keep their options open and can do things like change their credit card limit, cash advance limit and update their default rate to determine how much of a penalty they want to give them for being overdue on payments.

6.       Teach them the mechanics of good credit and debt ratios

It is never too early to start helping your teen build their credit. To keep things simple, talk to your teen about the importance of paying down their balances each month. When they understand credit scores are basically an assessment of their risk, they’ll understand that having good credit means not using the full amount that is available to them each month.

This risk ratio, called the debt-to-credit ratio, is an important factor they should understand when building credit and being smart about avoiding debt. Financial professionals that tell you to use the 20%-30% of your debt are usually bankers that know by carrying a balance you will always be paying interest. The fact is that your score will be better by carrying less than 10% and your interest will be zero if you pay the cards in full.

Your Debt-free Teen 

All parents want to set their kids up to be successful in life and one of the best ways they can do this is to teach them about debt. The average American has over $15,000 in credit card debt, meaning many of our neighbors have a financial burden looming over them each month. With smart planning, teens can avoid this downfall and lead more successful financial lives.

 

Author Byline: “Debthelper.com is an IRS Approved 501c3 Non-Profit Florida Corporation dedicated to our mission to educate, advise and empower youth to seniors to handle debt, credit and housing and to provide affordable housing opportunities through the acquisition and rehabilitation of residential properties.”

 

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Source: Bankruptcy blog

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Should I use a debt-settlement program instead of bankruptcy?

 

A debt settlement program may seem like a good idea at first.  Who wouldn’t want to try to pay things back?  The problem is that they don’t always work.   You should research carefully the advantages of a bankruptcy filing.  If you need immediate relief and court protection, bankruptcy will be the best option.

In some cases, debt settlement may, in fact, be a great option for you.  A Chapter 7 Bankruptcy or a Chapter 13 bankruptcy does not work for everyone.  I have seen some situations where debt settlement may be a better option than bankruptcy.  However, these situations are unique, and you should always use an attorney to represent you.

Chapter 7 Bankruptcy and Chapter 13 Bankruptcy offer a major advantage over debt settlement. Since bankruptcy is supervised by the courts, you are not at the mercy of creditors. Unless you have large amounts of cash to offer, a debt settlement is usually not attractive.  The only way to negotiate a debt settlement is to have something to offer.  Since most of my clients do not have liquid assets, a Chapter 7 or Chapter 13 Bankruptcy will usually be a better approach.

In any event, you should not handle these matters on your own.  You should seek the advice of an experiences attorney to guide you.

Sean C. Paul, St. Louis attorney, explains why bankruptcy is usually better than debt settlement

Sean C. Paul is licensed to practice law in the State of Missouri. His practice is located in south St. Louis County. He can help you with your Chapter 7 or Chapter 13 Bankruptcy case. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

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Source: Bankruptcy blog

So bankruptcy can help me?

The key is having a normal life.  Many people choose to continue to struggle with debts.  While it may be possible to do for years and maybe even forever, it isn’t a good qualify of life.  Let me ask you this:  are you getting ahead?  Do you have a retirement account?  Do you have money saved for an emergency?  Or are the credit cards your emergency fund?

A bankruptcy CAN help.  It doesn’t have to be a dirty word.  And it doesn’t have to be the end of your financial life.  In fact, it should be a NEW BEGINNING.   I know that, sitting where you are right now, that seems hard to believe.  Filing bankruptcy is the equivalent of financial destruction, right?

WRONG!

Chapter 7 Bankruptcy and Chapter 13 bankruptcy are here to HELP you rebuild your financial life.  While it may seem like the last resort – and I know the last resort is usually the least desirable option – you deserve the fresh start you can get from the bankruptcy code.

So what does a fresh start look like?  What does it mean?  How about this:  saving for retirement, building an emergency fund, and improving your quality of life!  Would you like stress-free nights and actually having a few extra bucks in your pocket when you need it?  Yes – bankruptcy can help!

Please contact me today to discuss how to build credit and make your life better.  314-827-4027.

Sean C. Paul is licensed to practice law in the State of Missouri. He can teach you that bankruptcy can help you rebuild your financial life. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

 

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Source: Bankruptcy blog

Can I buy a car after bankruptcy?

So you are done with your bankruptcy, right?  You need a new car?  Getting a car after bankruptcy IS POSSIBLE!

You most certainly CAN get a car after bankruptcy.  Whether you are filing for Chapter 7 or Chapter 13 relief, I can refer you to a lender that will help you obtain financing.   These lenders work specifically with people who have filed for bankruptcy relief.  If you have steady income right now, they can almost certainly help you.

If you are doing a Chapter 7 bankruptcy and you currently have a car payment this is too high, we can discuss giving that car up and getting a discharge.  Then, I will refer you to someone who can help you buy a car after bankruptcy.  Many times, this will give you a lower car payment and a slightly newer car.

If you are doing a Chapter 13 bankruptcy, we can ask the court to approve a new car loan.  Again, this may allow you to obtain a smaller car payment, but a slightly newer car.

Obviously, the new car purchase will help you build credit.  This is key to getting your financial life back to normal.

Please contact me today to discuss how to build credit and make your life better.  314-827-4027.

Sean C. Paul is licensed to practice law in the State of Missouri. His practice is located in south St. Louis County. He can help you with your Chapter 7 or Chapter 13 Bankruptcy case.  Talk to Sean about how to buy a car after bankruptcy. Sean C. Paul will give you the individual attention you deserve. He will meet with you one-on-one to determine how he can help you. If you are considering filing bankruptcy in Missouri, please call today. Sean C. Paul, Attorney at Law Google+ Profile.

 

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Source: Bankruptcy blog

Are you looking for bankruptcy relief? Are you facing a garnishment, bank levy, or constant creditor calls? I can help you file for Chapter 7 or Chapter 13 bankruptcy relief quickly!

In a Chapter 13 bankruptcy, you can usually repay pennies on the dollar and stop the interest that is accumulating against your credit cards. We can often lower your car payment and decrease the interest rate. I can help you obtain relief under Chapter 13 of the bankruptcy code for as little as $500 up front! Any additional bankruptcy fees will become part of your Chapter 13 repayment.

I offer competitive prices for Chapter 7 bankruptcy as well. Since Chapter 7 cases vary in complexity, I can’t quote exactly what it will cost. However, the court charges a $335 filing fee and I will have to pull credit reports to obtain a list of your debts. My attorney fees for a Chapter 7 case starts around $600 for my St. Louis-area clients.

If you want to get out of debt and stop creditors, call me today at 314-827-4027.

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Source: Bankruptcy blog