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Middle Tennessee Bankruptcy Blog

Are you aware of how much credit card debt you owe?

Many Tennessee consumers have some credit card debt. Like many others, you may use your credit card as a way to pay for daily purchases, like groceries, gas and clothes. You may also depend on your credit card as a sort of emergency fund -- a way to pay for unexpected things you didn't know you would need, like medication or even medical bills. 

Credit cards are part of the American financial landscape, but they are easy to lose track of. Surveys have found that a surprisingly high number of people actually do not know how much they owe. It may surprise you to learn that many people also have no idea how much interest they pay as well. When a person is facing a financial situation that is beyond his or her control, it may be appropriate to consider the benefits of consumer bankruptcy.

What the means test means for your bankruptcy filing

Are you struggling with different types of debt? You may know that one of the options available to you includes filing for Chapter 7 bankruptcy, but you may not realize that not everyone is eligible. Before you can move forward with Chapter 7 bankruptcy protection, you may have to complete the means test. 

The Means test has been around since the U.S. Congress overhauled U.S. bankruptcy laws in 2011. The test will determine if you are eligible for Chapter 7. It is basically a calculation based on your ration of available financial assets (income) to your debt. If the results of the means test reveal that you are not eligible, you have the right to explore other options, including Chapter 13 bankruptcy. Before you move forward, you may want to learn more about what to expect from this test and what factors determine if you qualify for bankruptcy protection.

Worried about losing your property in Chapter 7 bankruptcy?

Struggling with debt can bring a host of complex and negative consequences to your life. You may find that you are dealing with phone calls from creditors on a regular basis, past-due notices coming in the mail and much more. In order to effectively deal with these things, you may consider the benefits of filing for bankruptcy.

Choosing to move forward with Chapter 7 bankruptcy is not an easy choice. You probably wonder what this step will mean for your future and what will happen to your personal property. It may be encouraging for you to learn that there are certain exemptions available that may allow you to keep most of your personal property. This allows you to deal with your debt without losing many of your important personal possessions.

Avoid mistakes when seeking debt relief

Even when paying close attention to your spending, debt can creep up on you. One unexpected expense or poor decision can result in trying to manage the payments on numerous credit accounts, loans, a mortgage and car payments. You may have medical bills and student loans thrown into the mix.

When you realize your paycheck isn't stretching far enough to cover all your debt, you may start to look at ways to pay down what you owe. While there are some commendable steps you can take to reduce your debt, it is easy for panic or desperation cause you to use ill-advised methods for debt repayment. As much as you may wish to rid yourself of overwhelming debt, some actions can have a long-term negative effect on your future.

Wage garnishment: What is it, and how can you make it stop?

There are few things as stressful for Tennessee consumers as facing a significant amount of debt they are unable to pay. If you find yourself in this position, you understand the complications that come with being in a difficult financial situation – phone calls from debt collectors, accumulating interest and even the garnishment of your wages.F

For those who might be unfamiliar with the phrase, wage garnishment is a legal tool creditors have at their disposal to force repayment of a debt. Under the laws of the State of Tennessee, creditors may seek payment for what you owe by having your employer remove a certain portion of your paycheck. This continues until you pay the debt in full. If it is already happening to you, or you are being threatened with the creditor action, you may be wondering how to make it stop. The good news? Yes, there are legal actions you can take to prevent it. 

The Chapter 13 hardship discharge

If you are one of the many people in Tennessee who has filed for debt relief via a Chapter 13 bankruptcy, you will know that this is not a quick fix to your debt problems. You are initially obligated to make monthly payments to a trustee for a minimum of 36 months and possibly for as long as 60 months. During such a long span of time, many things in your life may change and you might find yourself in a situation that makes it all but impossible for you to keep up with your bankruptcy payments.

If this happens to you, you should know that you might be able to qualify for what is called a hardship discharge. As explained by the United States Courts, this may offer people who fall on hard times a way out of their Chapter 13 responsibilities earlier than they had planned or promised. One of the criteria for qualifying for this type of discharge is that your creditors should have been paid at least the amount they would have received if you had originally filed for a Chapter 7 bankruptcy.

What is chapter 7 bankruptcy?

Like many Tennessee residents, you may have fallen into personal debt from credit card use, unexpected medical expenses or job loss. When you start to search for ways to get out of debt, you may feel overwhelmed by the numerous options that are available. One such option is chapter 7 bankruptcy. Depending on the unique aspects of your financial situation, chapter 7 may be the right solution to recover from overwhelming debt.

According to the Administrative Office of the U.S. Courts, chapter 7 of the Bankruptcy Code centers on paying creditors through liquidation of assets. One of the potential benefits of filing for chapter 7 is that the petition usually stops ongoing debt collection actions. Before choosing to file for chapter 7, you should understand the qualification requirements. The terms generally state that you must not have filed and then dismissed another bankruptcy petition in the last 180 days. Additionally, you usually must receive credit counseling from an approved source at some point within 180 days before filing.

How Tennessee residents can deal with unexpected medical debt

Have you ever been to the emergency room for something like a broken bone, or have you ever had to stay in the hospital overnight because of a surgery you needed? If so, you are like many in Tennessee who find themselves dealing with expensive and often overwhelming medical bills. Even getting minor medical care can be costly, especially for those needing emergency treatment. 

And who do you know who plans financially for a medical catastrophy? Most people only have enough liquid assets to cover a month or two of bills. In many cases, people need medical treatment before they have had time to financially prepare for such a monumental cost. You may find that you have bills coming in and a debt burden that you can never hope to overcome on your own. If you are facing this seemingly hopeless situation, you are not alone. There are options available to you, including the possibility of securing a better future through bankruptcy.

Retain your assets with Chapter 13 bankruptcy

There are usually only two ways for individuals in Tennessee to file for bankruptcy: Chapter 7 and Chapter 13. Each involves eligibility requirements relating to the amount of debt you owe and the amount of income you bring in each month. Often, you will be eligible for either one or the other, but at Rothschild & Ausbrooks, we have seen situations in which people have qualified for both Chapter 7 and Chapter 13. If this is the case, you have a choice between the two. Each has strengths and weaknesses but, depending on your situation, Chapter 13 offers advantages that may make it more suitable. 

If you worry about losing any of your assets, such as your car and home, upon filing for bankruptcy, Chapter 13 may be the better option for you. While Chapter 7 involves liquidating assets to satisfy your debts, Chapter 13 reorganizes your debt into a repayment plan. There is no chance of losing any of your property if you file Chapter 13. 

Removing missed payments from your credit report

Credit can be a great benefit, offering you easy access to funds in the event of an emergency in Nashville. Yet it also can lead to long-term financial difficulties if you are not able to manage it wisely. It is fine to use credit (even advantageous, in certain situations) as long as you remain committed to paying it back in a timely manner. Missed credit card payments are among the most common issues found on personal credit reports. Such negative marks can remain on a credit report for up to seven years. Many have come to us here at Rothschild & Ausbrooks, PLLC wondering if there is a way to get such issues resolved sooner. 

If you have struggled with credit card debt in the past, you should know that you are not alone. Data compiled in the Consumer Financial Literacy Survey shows that 34 million Americans have admitted to being late with their credit card payments. Even a single late payment can affect your credit score. Yet if you still have an open account with a credit provider, that company may be willing to work with you to remove the record of your late or missed payment in the interest of retaining your business. It might be willing to simply remove the record altogether, or on the condition that you enroll in automatic payments or another of its services. 

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Rothschild & Ausbrooks, PLLC
1222 16th Avenue South, Suite 12
Nashville, TN 37212

Toll Free: 866-656-8909
Phone: 615-866-2265
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Nashville Bankruptcy Office