The last few years have shown economic ups and downs. Government shutdowns and sometimes hand-ups. As we return to ‘normal,’ we face layoffs, resumed lawsuits, foreclosures, and struggling with paying bills. If you put all expenses on a credit card and can’t pay it off, or if you must take a loan every month to make ends meet, you could be helped by legitimate debt settlement or bankruptcy. There is no shame in using the law to help yourself. Your creditors use it to help themselves.

Let’s talk debt settlement! You have been up late or just scrolling through cable TV and seen the ads that they can get you out of debt. Well, maybe. These companies collect their fee in total from your monthly payments, and then they start ‘saving’ up money to work a lump sum settlement with your creditors. If this takes more than four months, your creditors will start a lawsuit to collect as they have not received payment. You are being sued, and the company you hired has all your money. If you contact an attorney who can negotiate with your creditors for a lump sum payment or a payment plan. This will eliminate a lawsuit and get you back on track with your creditors.

What if you cannot participate in debt settlement and are in a financial crisis? It is time to look at bankruptcy. There are two types of consumer debt bankruptcies. Chapter 7 and Chapter 13.

Chapter 7 Bankruptcy

This is the chapter of bankruptcy that can eliminate all or most of your debt. Certain debts like taxes and domestic support obligations cannot be discharged with a chapter 7. There are income requirements based on income and family size that determines if you can file a chapter 7. If you can use this chapter for relief, you can emerge debt free about three months from the date you file the case with the court. If you are current on your house and your car and continue to make the payments, you are able to keep your house and car in most cases.

Chapter 13 Bankruptcy

This is a chapter of bankruptcy in which you pay your secured debts, those loans that are attached to an asset, such as your house and car, but can eliminate all or part of your unsecured debt – credit cards and medical bills. You would also have to file a chapter 13 if your income vs. household puts your income over the limit to file a chapter 7. This chapter is used to help you catch up on mortgage payments and car payments so you can keep your house and car. The chapter 13 plan, paid over between 3-5 years, can relieve your debt and get you back on track.

If you are struggling to make ends meet, need relief so you can start over financially, or are at risk of losing your home, contact Moseman Law Office, LLC, so we can help you get the real debt relief you need and deserve.