Welcome to Bankruptcy Guide
Rebuilding Credit After Bankruptcy Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
Credit Counseling as a Bankruptcy Alternative
from:Sometimes it is possible to seek a bankruptcy alternative through credit counseling. It is feasible to get deeply in a debt, but be able to avoid bankruptcy when certain conditions exist. First and foremost, if you earn enough income to pay your current monthly expenses and your debt payments, but have fallen behind because of high interest rates or a one-time financial emergency, then it might be possible to avoid bankruptcy. Also, if your secured debt such as your mortgage and car payments are current and it is the unsecured debt wreaking financial havoc, then credit counseling may be a good choice. There are plenty of other good reasons why you might consider seeking credit counseling.
You can find many different types of credit counseling agencies, nonprofits and for-profit businesses. You should be very careful about the company or agency you choose, because some of them charge high fees. That means a significant amount your monthly payment would go to pay fees and not your debt. The best place to start when looking for a reliable and experienced credit counselor is with a bankruptcy attorney.
You should meet with the bankruptcy attorney in order to determine if credit counseling is even the path you should pursue. Credit counseling is usually only suggested instead of bankruptcy when two conditions can be met. First, you have to be able to budget your money and adhere to a repayment plan. Second, you only need to get interest rates lowered on unsecured and maybe some of the secured debt in order to get your payments lowered.
Credit counseling involves listing all of your income and debts. You are assigned a counselor who then contacts each of your debtors. In most cases, high interest rates on credit cards can be reduced and the credit card companies agree to accept lower payments. In some cases, even secured debt payments can be lowered, because a company would rather not repossess personal property if at all possible. Normally though, only unsecured debt is included in the repayment plan. Once the counselor has obtained the new payment amounts, a total monthly sum payment is calculated which includes a fee. You then pay that one amount to the credit counseling agency which distributes the payments to the credit card companies or other debtors.
For many people, credit counseling offers a bankruptcy alternative. You are able to avoid filing a bankruptcy that remains on your credit records for 10 years. The credit management services are often able to negotiate lower interest rates so you can restore your financial health. It's always best to avoid bankruptcy if possible, but when you need to actually reduce your debt, rather than just the payments, then bankruptcy is the best solution.
A bankruptcy attorney can review your financial status and advise you as to the best course of action.
Rebuilding Credit After Bankruptcy News
Stay at Home Moms Face Credit Card Challenges - Forbes
Stay at Home Moms Face Credit Card Challenges Forbes Credit in America has really changed since the banking crisis a few years ago. Gone are the days of practically free credit and rebuilding or establishing credit post-foreclosure, post-bankruptcy or even post-divorce is an entirely too common task. |
Create Your Post-Bankruptcy Credit Rebuilding Plan - Fox Business
Create Your Post-Bankruptcy Credit Rebuilding Plan Fox Business We now have a debit card, but when do you get a chance to show the banks that we are seriously trying to get our credit score back up? Rebuilding a positive credit history after a bankruptcy takes time and patience. Because you did have excellent ... |
Credit care: Secured card, loan may help rebuild score - Arizona Daily Star
Credit care: Secured card, loan may help rebuild score Arizona Daily Star We now have a debit card, but when do you get a chance to show the banks that we are seriously trying to get our credit score back up? A: Rebuilding a positive credit history after a bankruptcy takes time and patience. Because you did have excellent ... |
How To Survive Bankruptcy - San Francisco Chronicle
How To Survive Bankruptcy San Francisco Chronicle While both types of bankruptcies last for 10 years on your credit report, a Chapter 7 filing can have a more detrimental effect on your score. Rebuilding Credit After emerging from a Chapter 7 filing or during a Chapter 13, the first goal is to begin ... |
Foreclosed Americans find way back to homeownership - CNBC.com
 msnbc.com | Foreclosed Americans find way back to homeownership CNBC.com But less than two years later, in March, they purchased a $297000 house outside Phoenix, Arizona, after qualifying for a loan backed by the US government. They joined a small but growing number of Americans who are making a surprisingly quick return to ... Foreclosed Americans buying homes again thanks to government loans |