Credit Card Debt and Bankruptcy - Know Your Options
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Credit Card Debt and Bankruptcy

Credit card debt may be the most common type of debt in America. In 2008, Chase bank alone had almost 120 million credit cards in circulation.

For most people, credit card use is just another part of life. On the surface, there is nothing wrong with carrying some credit card debt.

But complicated contracts, ever-changing interest rates, hidden fees and complex billing procedures can quickly turn a small amount of credit card debt into financial devastation.

The good news: There are safe, reliable steps you may be able to take to eliminate your debt, and get your financial life back under control.

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Credit Card Debt Relief Options

Credit card companies make getting a credit card as easy as filling out a slip of paper at a baseball game. But getting rid of your credit card debt can be a more complex process.

Bankruptcy is designed to be a secure means of debt relief for people in true need. But there are several options under the bankruptcy umbrellas, and each functions in a slightly different way.

Bankruptcy processes are legally protected by United States law. However, one type of bankruptcy may be better for you than another. For many people, the first step is learning about the different bankruptcy chapters.

If you have specific questions, speak with a local bankruptcy lawyers about the laws in your state and how you might best be able to get debt relief.

If you only have credit card debt problems

Chapter 7 bankruptcy is designed to quickly eliminate all of your credit card debt. Only unsecured debt may be included in this filing, so if you are struggling with mortgage debt or car loans, this may not be a good fit.

Unsecured debt includes credit card, medical and utility bills, as well as personal and payday loans.

Chapter 7 cases may last only a few months, which means that you may be back on your feet quickly.

Before you file, you may want to get information on the Chapter 7 exemptions in your state. In exchange for rapidly removing your debt, a Chapter 7 does allow creditors, in certain situations, to claim certain types of property. In almost all cases there is no property sale thanks to Chapter 7 exemptions, which outline your protected property.

If you have several types of debt

While Chapter 7’s focus is mainly on credit card and medical debt, Chapter 13 bankruptcy may address almost all types of debt.

Home mortgages and car loans may be included along with your credit card and other bills in a Chapter 13 filing. Chapter 13 bankruptcy may also help you protect your property from pending foreclosure.

In order to file this type of bankruptcy you will need some regular income. Chapter 13 combines and orders your debts, allowing you to make one monthly payment to a trustee to take care of what you owe. This process takes place during a court-approved timetable which may last from 3-5 years.

Chapter 13 includes stronger property protections, and may be a good choice if you own lots of expensive assets, like several cars.

Speak With a Lawyer About Credit Card Bankruptcy

Bankruptcy was created to help relieve credit card debt. If you think you could use this kind of help, you may want to speak with a local bankruptcy lawyer.

A bankruptcy attorney can answer your questions, and explain how the laws in your state may affect your credit card debt.

To get a free case evaluation with a local bankruptcy lawyer, complete the free form on this page. We’ll connect you with an attorney in your area so you can get started on the road to financial relief.

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