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Getting Out of Debt with Chapter 7

By: Nick Messe

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The process called Chapter 7 bankruptcy is a court process that may eliminate most kinds of unsecured debt, and is fully sanctioned by and defined in United States federal bankruptcy law. By unsecured debt we mean such things as credit card debts, personal loans, car accident judgments, deficiencies on repossessed vehicles, and most medical bills. Here are some facts you should know about Chapter 7 bankruptcy.

First, be aware that the stigma associated with such things has virtually vanished. The truth is, most people who hear the word "bankruptcy" and shudder, really don't know anything about it. It is true that when you file for Chapter 7 bankruptcy it will remain on your credit report for up to 10 years, but you don't have to wait that long to start putting your financial life back together.

You can begin to rebuild your credit almost immediately after Chapter 7. Credit is your ability to borrow money. If you don't believe it, ask yourself whether you'd rather loan money to the person you are now, with loads of credit card debt, or the person you will be after your bankruptcy has been discharged.

As for your current mortgage lender and automobile finance companies, they are usually more than happy to continue on with your current monthly payments after a Chapter 7. This is called reaffirming your debt. These companies want to make money, not repossess your property.

If you do not presently have a car loan, or a mortgage, then shortly after your bankruptcy is discharged, you will be able to arrange for a vehicle. Within two years, with a minimum down payment and evidence of income, you will be able to put an offer on a house.

It is the credit card companies that will get to you first, often within a few months. Of course they have their own motives for getting you back onto credit cards. But if you are careful you can use this to your advantage. You can use this readily available source of funds to rebuild your credit. But be careful. You do not want history to repeat itself. Use your head and be prudent in how you use your new credit cards. Do not extend your cards to their limit, and try very hard to pay your balance off every month.

Perhaps most important, when you are considering any kind of bankruptcy you should consult with an expert in the field - a qualified and experienced bankruptcy lawyer. It is only common sense that a bankruptcy attorney who specializes in bankruptcy filings has the required know-how and experience in bankruptcy law to guarantee you the best possible outcome.

Article Source: http://depositarticles.com/

Nick Messe is the founder and president of Lead Frog LLC. Contact the bankruptcy lawyers at LegalHelpers.com. LegalHelpers has helped thousands of people and they can help you too - www.legalhelpers.com

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