With the economy being so bad this past four years, local authorities in some states are arresting debtors and placing them into jail. It is no coincidence that the bail to get out of jail is set at the same amount the creditor is owed. These types of actions has caused one US debtor to fear the return of debtor’s prisons here in America.

This personal bankruptcy story was posted on the internet in March of 2011 as comments in a bankruptcy discussion: “I am on disability, I owe a lot in past medical bills. I am being harassed on a more than daily basis by one collection agency. I am about to have even more surgery. I do not have the money to pay them at this time and will not be able to scrape together enough to pay them for a while and I worry all the time about when they’ll be able to haul me off to jail for it. At the rate this country is going, with privatizing prisons on the agendas all over the place,I have no doubt that we’ll have debtors prisons in no time if we as a nation do not stand up and fight back.”

Technically, bankruptcy is covered under the Constitution of the United States which gives Congress the power to legislate bankruptcy laws. The laws Congress have legislated through the years guarantees every citizen the right to bankruptcy protection, and without going to prison.

In the past, the United States did send debtors to a debtor’s prison in most states up until New York abolished the practice in 1831. The federal government, along with most of the rest of the states, followed suit in 1833.

Since then, rogue states and local authorities have challenged bankruptcy laws from time to time. The most common challenge to bankruptcy laws come in the form of de facto challenges. As an example, the most common use of throwing someone in jail comes not from owing the debt, but from failing to respond to a court order to appear before a judge who might demand you pay the debt or show good reason why you cannot. When you do not show up for the court appearance, a warrant is issued for your arrest for contempt of court.

A recent news article posted in the Star Tribune in Minnesota reported that arrests warrants for debt related contempt of court has grown over 60% in the past four years, and there were 845 issued in 2009 alone. Minnesota has some of the more creditor friendly laws in the nation.

Probably the greatest de facto debtors’ prison has already been largely accepted in the case of “deadbeat” parents when a failure to pay child support puts them in civil contempt of court. Most states around the nation usually find child support a dividing line as an argument for imprisonment. Bankruptcy laws through the years have evolved so child support cannot be discharged in bankruptcy cases.

The average cost to house an inmate across the nation is about $135 in 2011, including the cost of dental and medical coverage. The average income for most common workers in the US in 2011 is around $100 per day, from which they have to pay dental and medical costs if they are to have any. The average court award for child support in the US is $280 per month per child, and the average number of children per household is right at two. Considering normal living expenses and taxes, the average American paying child support will have approximately $1500 a month to live on and support a new family if so blessed.

So, what is the incentive for those who owe child support to work? What is the incentive to send the so called “deadbeats” to jail at a higher cost than they can ever make?

I suspect the new local laws to imprison debtors, even those debtors who owe child support, are more punitive in nature. I suspect the attitude of the local authorities to imprison their fellow man is more about piety and control than it has ever been about doing what is financially right for everyone concerned, including the debtor. It might bode well for all Americans if all would abide by the Constitution instead.

One way to combat local judgment is to file for bankruptcy protection. If you decide to file, you will most likely need a bankruptcy lawyer to help you understand the complex bankruptcy laws and how they might apply in your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan counties of Middlesex, Somerset, or Hunterdon, New Jersey, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

A new AARP study indicates seniors are filing for bankruptcy protection faster than other adults. Is this fact an indication of a new retirement plan for our Seniors?

The study showed that between 1991 and 2007 seniors aged 65 and older, who were overwhelmed with debt and unable to pay for rising medical costs, filed for bankruptcy 150 percent more than what they did in the past. The Consumer Bankruptcy Project found that among seniors aged 75 to 84, the rate of filing for bankruptcy protection increased by 433 percent. The study also noted that during the same time period, the number of younger Americans filing bankruptcy actually declined.

There is no clear cut reason made in the report for the rise in senior filings because no specific study for the reason why was done. Many observers reason that if the sagging U.S. economy, rising prices of food and gasoline, and uninsured medical expenses are driving many Americans to file bankruptcy, for the elderly living on a fixed income, these economic factors can drive them beyond filing bankruptcy and into poverty.

The seniors, who are being forced to file for bankruptcy in the droves, has probably not planned bankruptcy as part of their retirement. Nevertheless, when seniors cannot make financial ends meet, they are no different than any other Americans. They must file for bankruptcy in order to survive, protecting what little assets they have left.

The cost of living adjustments for social security, called COLAs, has not been increased since January of 2009. Many seniors lost their retirements during past stock market crashes, and all they have left is social security to rely on for retirement income. Inflation since January of 2009 has risen by 8.2%. That means the seniors on social security retirement are living on a little less than 92% of what they now make. The economy, along with the lack of a COLA has driven many seniors back into the work force, those lucky enough to get jobs that is.

Under the current circumstances, the fact seniors are filing more bankruptcies today is hardly an unusual phenomenon. It was once thought the Bankruptcy Abuse Protection and Consumer Protection Act of 2005 would prevent so many bankruptcies from occurring, or at least, that was the prevailing wishes of the creditor lobbying groups who were responsible for getting the new laws passed.

When the new bankruptcy law took effect in 2005, the number of people filing bankruptcy across all age groups temporarily fell. Even the stricter bankruptcy requirements were not enough to hold off many who were so smothered with debt that filing bankruptcy was the rational option. Soon the number of people filing bankruptcy began to rise again, and that number is probably most notable within the senior group of Americans.

If you are a senior who is currently experiencing the rising costs in living expenses and the rising costs in medical bills, you may need to consider making bankruptcy a part of your retirement plan.

Bankruptcy laws can be complicated, and it is recommended you consult with a bankruptcy lawyer in order to help you understand how the complicated process applies to you. If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan area of Hartford, Connecticut, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

Determining when it is time to file for bankruptcy is often a complicated process, but it can be simplified. In determining when bankruptcy is justified, three things normally happen before you make a decision to move on to file for bankruptcy protection.

First of all, creditors will apply various pressures on you possibly invoking debt collection procedures, law suits, garnishment, attachments, evictions, foreclosures, and the like. Selecting to do nothing about these types of activities can complicate the process to file and can create further debt in the form of interest, penalties, and fees.

Unless you are collection proof, meaning you do not have any assets for your creditors to go after, trying to outlast the statute of limitations in some states can be a cumbersome and harsh lifestyle within itself. The state statute of limitations on debt can range any where from a year to twenty years, and in some cases, creditors can extend those years indefinitely with a judgment from a court of law.

Secondly, selecting to do something about creditor collection activities can help you resolve some of your differences, or it can turn into a very frustrating experience. Often times, debtors will choose to alleviate their debt problems in a variety of ways. The most common way to alleviate a conglomeration of debts is to consolidate them into one payment. The only problem with this solution is whether or not you still have enough credit to obtain the consolidation. If you do, problem solved, but if not, many seek out a third party to help them consolidate, often frustrating the process and expenses.

Another way you may choose to alleviate debt problems is through either negotiating with your creditors or getting a third part to negotiate for you. Very few creditors will re-negotiate their contracts with a customer. A third party can be successful, but many times, they charge you for a product they often don’t deliver.

Finally, you realize there is literally nothing at this point you can do to solve your debt problems. You begin to understand there is a real possibility you are completely bankrupt and without the financial ability to pay your debts. You may even come to the place where you compare your income to your expenses to see whether or not it is possible to ever pay off all your debts.

Being bankrupt is much more a black and white experience than it is a gray one. As a general rule of thumb, you are completely financially bankrupt if your current sustainable income plus any cash reserves will not pay all of your living expenses, pay interest on outstanding loans, and reduce some of your principal on those loans while paying on them for five years. Depending on which state you live, the formula should not consider the current value of your assets owned outright including any retirement accounts. Paying off debts for five years is chosen because five years is the maximum legal number of years a United States Bankruptcy Court allows an individual to work their way out of bankruptcy protection.

After coming to this final conclusion you are completely bankrupt, your choices are now more simplified and justifying bankrupt is simpler. If you have assets to protect, you can file for bankruptcy protection invoking the automatic stay, common to all bankruptcy proceedings, and immediately prevent creditors from bringing certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment.

Justifying bankruptcy can be simplified, but bankruptcy laws can be complicated, and common sense indicates you might need a bankruptcy lawyer in order to help you understand how these complex laws may apply in your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan area of Nashville, Tennessee, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

Most people who are forced into having to file for bankruptcy protection do so because it is their last option. Many debt management gurus on the internet teach that filing for bankruptcy should be your last resort or option, but should it be?

This personal bankruptcy story was posted on the internet in November 2010 as a comment in a discussion on bankruptcy: “I tried for years to repay [my creditors], especially credit card companies, always the new plan. I would make some ground, then a truck would break etc.. no fun being in credit debt. I had my own business and worked at times 15-20 hrs a day… If you need to do it [file bankruptcy], have run out all your options, there is no shame in it. It’s as it was meant to be, a fresh start for those who need it. Good luck to all others. Filed in April, here we are November, 7 months later and no discharge or specific word yet. It is frustrating, but it is a last option.”

The debtor in this personal bankruptcy illustration testified there should really be no shame in the last option of filing for bankruptcy protection. Filing for bankruptcy is what he did as a last resort.

When an individual files for bankruptcy protection is really more of a personal choice, but sometimes that choice is made for you. There are two forms of bankruptcies- voluntary and involuntary. Although rare, an involuntary bankruptcy occurs when a creditor legally forces bankruptcy proceedings onto a debtor. The greatest majority of bankruptcy proceedings are of the voluntary variety. Debtors being involuntarily filed on usually respond with a voluntary filing of their own, so in effect, the choice is not really the debtor’s because the debtor is forced to file.

To avoid some of the stress associated with going bankrupt, the choice might be made sooner in some cases. In any regards, there is a relatively easy way to determine whether you should file for bankruptcy or not.

Becoming bankrupt is a black and white experience much more than it is a gray one. As a general rule of thumb, you are completely financially bankrupt if your current sustainable income will not pay all of your living expenses, pay interest on outstanding loans, and reduce some of your principal on those loans while paying on them for five years. Five years is the maximum legal number of years a United States Bankruptcy Court allows an individual to work their way out of bankruptcy protection.

If you find yourself in the position of being or going completely bankrupt, there should be plenty of motivation for you to file for bankruptcy protection. By this time, many of your creditors will most likely be pursuing you and invoking debt collection procedures, law suits, garnishment, attachments, evictions, foreclosures, and the like. Also at this point, you may have already tried debt management companies and consolidation of your loans to no avail. Since the debts will not go away by themselves and the pressure from your creditors are most likely to increase, the events should provide plenty of motivation for you to file.

The moment you file a bankruptcy, a judge will order all collecting actions to cease, an important feature called the automatic stay. The automatic stay, applicable to all types of bankruptcy filings, means that the mere request for bankruptcy protection automatically stops and brings to a cessation certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment.

If you have found yourself in a situation where you cannot reduce your debt load within a five year period, you may be a candidate for filing a bankruptcy, but choosing the appropriate bankruptcy to file can be a complicated and tricky process. Common sense indicates you might need a bankruptcy lawyer in order to help you understand how complex bankruptcy laws may apply in your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan counties of Bergen or Passaic, New Jersey, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

In 1980, the federal government passed a special law which allowed national banks to ignore state usury limits and peg the rate of interest at a certain number of points above the federal reserve discount rate. In addition, specially chartered organizations like small loan companies and installment plan sellers have their own rules. That means that the laws in most states do not have enough teeth to regulate credit card debt. As a result in many cases, about the only way a person can relieve exorbitant debt from various banking institutions is through filing bankruptcy.

Credit card debt is one of the leading reasons people file for bankruptcy protection, but if you are “collection proof,” meaning you do not have enough assets creditors can get hold of to satisfy debt, you may not need to file for bankruptcy protection at all. All states have a statute of limitations on debt collection.

Statute of limitations are basically broken down into four debt categories by law. These categories include oral contracts, written contracts, promissory notes, and open-ended accounts. The latter category deals with credit card debt.

For Virginia, the statute of limitations for oral contracts is three years, and written contracts is six years. The statute of limitations for promissory notes is six years, and the statute of limitations on open-ended accounts is three years from the last payment or last charge for goods or services rendered on the account.

Going to court and winning a judgment against a debtor is another matter. A judgment in Virginia carries a statute of limitations of 10 years. A creditor must renew a judgment before the time frame ends if they want to keep an attachment or lien alive. The judgment can be renewed to 20 years in Virginia.

Not all collection agencies play by the rules. Often, many will call you after the statute of limitation has run out of date and try to get you to acknowledge you owe the debt. If they can get you to acknowledge your debt and it is a qualifying debt like a credit card debt, the statute time for limitations begins afresh from that day forward.

So, what you might want to do when these agents come calling is to ask them to send you paperwork to verify exactly what debts they claim you owe along with dates of the claimed debt. If it is debts that has passed the statute of limitations, you might want to get their mailing address and send them a cease and desist letter to stop collections. You can explain in the letter why you do not owe the amount. If they cannot verify the claim, you might want to send the collection agency a cease and desist letter anyway.

The Fair Debt Collection Practices Act (FDCPA) was passed by Congress to protect consumers by providing a fair playing field in debt collections that parallels both federal and state laws. The FDCPA states all collection agencies must verify any debts they claim you may owe. If a debt is out of the statute of limitations or is unverifiable, the collection firm is prevented from pursuing the loan in any harassing manner. Continued violations by collectors could result in fines for the violators, court costs, and attorney fees. That is the reason a cease and desist letter should be sent.

If you have assets to protect from creditors seeking to get a judgment and your debt has not reached the statute of limitations, your best bet to handle the situation is most often filing for bankruptcy protection. Bankruptcy laws can be complicated, and common sense indicates you might need a bankruptcy lawyer in order to help you understand how these complex laws may apply in your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan areas of Norfolk, Virginia Beach, or Newport News, Virginia, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

When you hear so much negative news on a daily basis, you sometimes forget about the positive side of your lives. There has been a lot presented in the news lately that is very negative about the financial condition of America, but America still enjoys a strong economy despite the news.

Americans have historically been hard workers and strong reliable bill payers. You might sometime forget, in lieu of all the negative publicity about the economy, that the American worker is the backbone of our country. Despite becoming a service providing nation in recent years, America still leads the world in production within the manufacturing sectors. In other words, the economy, although now service oriented, still leads the world in producing things, and our economy is still the world’s largest national economy.

A recent survey in The Mainstreet Newsletter of New York revealed that one in 8, or about 13% of all adult Americans, have considered filing bankruptcy at some point. Men were found to consider bankruptcy more often than women, and the middle-aged group, between 35 and 54, were more likely to consider filing than those over 55. The survey was not really scientific, but you could make the generalization from it that bankruptcy has become a little more acceptable in recent years. Out of the 1,000 surveyed, only one percent had actually gone through a bankruptcy.

You might conclude that the good news from the survey is that a large number of people may be thinking about filing for bankruptcy protection at one point in their life, but one percent or less have actually gone through the process. That means, contrary to some public opinion, most people want to do the right thing about paying the bills they owe. From the results of the survey, it should be easy to see society is hardly abusing the bankruptcy system, and in light of the American worker being willing to pay their bills, certainly you should not have the view America is a society of deadbeats.

To the contrary, the positive twist in this revelation is that despite a sluggish economic recovery, the American worker is still doing the right thing. Regardless of whether America has been in the Great Depression or the Great Recession, the American worker has responded to the challenges, and in doing so, has never really whined about it as a nation.

To end the Great Depression, millions of American workers responded to the call to serve in the Conservation Corps Camps across the United States. The work provided by that group not only lifted the American spirit during the time, the workers provided a lead example for what America has done about conservation ever since.

In light of the facts presented, there should be strong doubt there was enough abuse of our bankruptcy system to warrant the changes made in the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005. In viewing history and the current recession, the act seemed more bent on satisfying creditor lobbyists than solving abuses in filing for bankruptcy made by the American worker.

In addition to the abuse segment of the 2005 laws, the law changes added private student loans to the non-dis-chargeable list in bankruptcy protection and usury to the student loan collection process. The burden of student loans is being the financial ruination of many in the one percent category of filers.

If you have been a strong American worker who has fallen on tough financial times in this past recession, don’t allow the naysayers to keep you from getting a fresh new financial start. It is your Constitutional right to start over, but remember, bankruptcy laws are complicated, and you might need a bankruptcy lawyer to help you understand how the laws might apply in your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan area of Sacramento, California, contact us here today at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

When my children were born, parents and grandparents tended to lavish them with toys. Unlike generations in the past, when toys were not so readily available from the store and gift giving was limited, the expanding economy allowed for charitable giving, even for the middle-class.

When I was a child, I was given few toys and learned to occupy my time with what I had. I remember countless hours of joy and imagination with a simple cardboard boxe. Almost 60 years later, many of the middle-class of my generation may be returning to the cardboard box of their youth.

This personal bankruptcy story was posted on the internet in July of 2010: “My husband lost his job about a year after we bought our house. He was unable to find another full-time job, and they kept cutting back my hours at the supermarket where I worked. We declared bankruptcy in an attempt to save the house, but we ended up losing it a couple of years later. We have a small business now, and we hope that we manage to keep it going. We are both in our 50′s (my husband is not far off 60) and not in the best of health, so I can’t imagine either one of us finding a another good job. When people ask me about our retirement plan, I tell them it involves a cardboard box under a bridge, and I’m not entirely joking.”

This debtor jokes that her retirement plan may include a cardboard box under a bridge. Unfortunately, today many middle-class people in America are in the same condition as this debtor.

The volatile stock maket has eliminated many retirees investment accounts. The only retirement income for most middle-class Americans is now Social Security.

In addition, the current housing crisis is also taking its toll on those nearing retirement age. Many are losing their houses because of the crisis and many will not be able to afford mortgage payments on social security income if they survive the crisis. As a result, many may be forced to work well beyond their retirement age, fearing they might be living in a cardboard box under a bridge somewhere if they do not.

There is one silver lining: America is still the land of opportunity. As illustrated by the debtor, many Americans still have the opportunity to start a small business. As long as we have the Constitution to guarantee our pursuit of happiness, there is still hope. In America, we can live in a cardboard box and do better than many people living in other areas of the world.

As a society, we have come a long way since the days of debtor prisons. The Constitution provided for our protection against those antiquated laws. Bankruptcy laws have also been designed to protect both creditor and debtor. Starting over is what we Americans do best. We understand the need for forgiveness and a fresh new start. Our history is full of citizens who have attempted a business venture and failed but who have started over and succeeded.

If you are currently being forced into bankruptcy, there is no need yet for you to return to the cardboard box of your youth. You can still start over.

Bankruptcy laws can be complicated. If you need relief from the stress of debt and you live in or around the metropolitan area of Orlando, Florida, contact us at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.

This personal bankruptcy story was posted on the internet in August of 2011 as comments in a bankruptcy discussion: “I am in need of your help. I quit a job ten months ago that paid well, but due to stress levels, it was starting to cause me health issues. I took a job that paid me half of the salary of my last job but we are happy. In the meantime, my motorcycle got repossessed, our house will be repossessed, and creditors are threatening to sue us. We don’t live in our house, but we bought a used mobile home two years ago. We have been trying to sell our old house but have had no luck. Should I or do I need to file bankrupt in North Carolina? I was told that in North Carolina they cannot take our vehicle or house. Is this true?”

So does bankruptcy provide bankruptcy protection in North Carolina? Evidently, this debtor is in the beginning stages of defaults and unsure about whether he should file or not. Keep in mind, certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment may be stopped by filing for bankruptcy.

So how do you know if you are bankruptcy and it is time to file? There are a variety of financial things that can happen that may cause you to go bankrupt. A sudden loss of income, unexpected health problems, an unexpected divorce, a catastrophic event, or an overall poor economy can all play roles in contributing to your bankruptcy.

Generally, you are completely financially bankrupt if your current sustainable income plus any cash reserves will not pay all of your living expenses, pay interest on outstanding loans, and reduce some of your principal on those loans while paying on them for five years. Depending on which state you live, the formula should not consider the current value of your assets owned outright including any retirement accounts. Paying debts for five years is chosen because five years is the maximum legal number of years a United States Bankruptcy Court allows an individual to work their way out of bankruptcy protection.

The debtor in the illustration may have been given some bad advice. He indicates his home and automobile are exempt from repossession in North Carolina. That all depends. If the house has a secured loan, the mortgage company can foreclose on the property if he has defaulted on the payments, and the debtor can lose the house, even in North Carolina. The same can be said for the automobile.

The debtor may be referring in his story to not being able to take the house or automobile because of bankruptcy exemptions. In North Carolina, the homestead exemption on real or personal property, including co-op, used as residence is up to $35,000 (husband and wife may double, and $60,000 if 65 or older and spouse is deceased). The automobile exemption is $3,500 as a wild card can be used along with $5000 of the unused homestead exemption.

In any case, to keep the house, all payments must be made up to date or the mortgage company can foreclose even during a bankruptcy.

As you can see from the illustration, bankruptcy laws can be complicated, and it might be wise to consult with a bankruptcy lawyer before you make any bankruptcy decisions.

If you need relief from the stress of debt and you live in or around the metropolitan areas of Charlotte, Gastonia, or Rock Hill, North Carolina, contact us at www.betterbankruptcy.com. We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.

In 1978, the Supreme Court made a ruling that would change the face of how banks dealt with credit card interest. The Marquette Bank opinion permitted national banks to export interest rates on consumer loans from the state where credit decisions were made to borrowers nationwide. Existing federal rules required a formal invitation to be issued by the legislature of the state the bank wanted to enter before banks could set up operations outside their home state.

It wasn’t long before states like South Dakota and Delaware took full advantage of the new jobs the banks offered. South Dakota’s legislature first passed laws in 1980 effectively eliminating their existing usury laws so Citibank could move their credit card operating headquarters to the state. Citibank eventually delivered 3,000 high paying jobs to the state that rewarded them with an operations base and ignored all the other state’s maximum usury rates to operate their business.

In 1980, Washington began a move, led by the Office of the Comptroller of the Currency, to peg the rate of interest at a certain number of points above the Federal Reserve Discount Rate. Specially chartered organizations like small loan companies and installment plan sellers would have their own rules. That means the usury laws in most states do not have enough teeth to regulate credit card debt today. As a result, many people have difficulty eliminating credit card debts with exorbitant interest rates and are faced to file bankruptcy.

Credit card debt is one of the leading reasons people file for bankruptcy protection, but if you are “collection proof,” meaning you do not have enough assets creditors can get hold of to satisfy debt, you may not need to file for bankruptcy protection at all. All states have a statute of limitations on debt collection.

Statute of limitations are basically broken down into debt categories including open-ended accounts, oral contracts, written contracts, and promissory notes. Statute of limitations in California carry a term of four years on open-ended accounts, two years on oral contracts, four years on written contracts, and four years on promissory notes.

Going to court and winning a judgment against a debtor is another matter. A judgment in California carries a statute of limitations of 10 years, but the limit can be renewed in order to extend the lien. The judgment can carry interest of 10% per year until the lien is satisfied.

Not all collection agencies play by the rules. Often, many will call after the statute of limitation and try to get you to acknowledge you owe the debt. In some states, if they can get you to acknowledge your debt and it is a qualifying debt like a credit card debt, the statute time for limitations may begin afresh from that day forward. In California, the statute of limitation is stopped only if the debtor makes a payment on the account after the expiration of the applicable limitations period.

The Fair Debt Collection Practices Act (FDCPA) protects consumers from unscrupulous collectors by providing a fair playing field in debt collections. The FDCPA states all collection agencies must verify any debts they claim you owe. If a debt is out of the statute of limitations or is unverifiable, the collection firm is prevented from pursuing the loan in any harassing manner. Continued violations could result in fines for the violators and requied payment for court and attorney fees.

If you have assets to protect from creditors seeking to get a judgment and your debt has not reached the statute of limitations, you may need to file bankruptcy.

If you need relief from the stress of debt and you live in or around the metropolitan areas of San Francisco, California, contact us at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.

After the Bankruptcy Abuse Prevention and Consumer Protection Act was passed in 2005, rumors circulated that if you had a job, there was no need to file bankruptcy because it would do no good. The supposition was that if you had a job, you could afford to pay your debts. The only way to fund a Chapter 13 bankruptcy filing, however, is if you a job, so the myth is false.

The means test was implemented in the 2005 to divert filers, who made more than the median income compared to other filers in their state,  to a Chapter 13 Bankruptcy. In reality, this rule has affected very few filers. 

Means testing refers generally to the eligibility for relief of debtors who have sufficient financial means to pay a portion of their debts. Debtors whose income is below the state’s median income for a family household of the same size are not subject to the means test.

A means test includes a formula designed to help determine who is eligible to file for Chapter 7 Bankruptcy, the simplest type of bankruptcy to file. Although a complicated formula, the bankruptcy means test is rather generous and many debtors have no trouble meeting its requirements. Almost 80% of all individual filers today file Chapter 7 Bankruptcy.

Means testing is determined by how much disposable monthly income you have. More accurately, it is called discretionary income, and it is the total gross income of all the earners in a family, minus the cost of taxes and living expenses. If your discretionary income falls between $100 and $166.66 per month, your eligibility for Chapter 7 Bankruptcy is determined based on the percentage of your discretionary income to your debt, with 25% as the cut-off. If your discretionary income over 60 months exceeds 25% of your debt, you must file Chapter 13 Bankruptcy. If it is less, you can file under Chapter 7 Bankruptcy.

There are advantages and disadvantages for filing Chapter 7 or a Chapter 13 Bankruptcy.

If you qualify for Chapter 13 Bankruptcy you may be able to save your home from foreclosure, to reschedule secured debts, to provide protection for co-debtors, to consolidate your loans under one plan, to keep non-exempt property, to extend certain tax obligations, student loans, or other such qualifying debts and to qualify for bankruptcy relief.

Filing Chapter 7 Bankruptcy has its own advantages. Chapter 7 Bankruptcy can bring faster and greater relief, make filers better credit risks more quickly (because they do not carry ongoing payments) and it is cheaper. The success rate for getting a discharge through Chapter 7 Bankruptcy is also higher.

How do you know which bankruptcy to file? If you have assets you want to keep, you currently have an income, and you want to try to pay your creditors as much as you can, Chapter 13 bankruptcy may be right for you. If you do not have many assets, you do not have a mortgage, you want to discharge your debts debts quickly, Chapter 7 Bankruptcy, if you qualify, may be a better option.

Whether you have a job or not, you can file file for bankruptcy protection. If you need relief from the stress of debt and you live in or around the metropolitan areas of Cleveland, Lorain, or Elyria, Ohio, contact us at www.betterbankruptcy.com .We will help you find a bankruptcy attorney in your area who will answer your bankruptcy questions.