Understanding the Benefits and Consequences of Bankruptcy
People who file for bankruptcy relief usually realize different benefits at different stages of the process, but for most people the biggest benefit comes at the very end — discharge of debts. In other words, you can walk away from most unsecured debts and the undersecured portion of claims covered by collateral. That's when you can concentrate on rebuilding your credit and getting along with your life after bankruptcy.
Call 619-222-SHAY for Advice About Your Right to a Discharge of Debts
For most consumers in either Chapter 7 or Chapter 13, the prospect of a discharge of a significant portion of indebtedness stands as the main incentive for filing the petition. With important exceptions, such as student loans or taxes, you can look forward to a discharge of unsecured claims on credit card accounts, medical bills, utility bills and other consumer debts.
One main difference between Chapter 7 and Chapter 13 has to do with when you obtain your discharge. In Chapter 7, you get your discharge after your trustee and creditors have had a chance to object, and don't do so — four to six months after you file your Chapter 7 petition.
In Chapter 13, you get your discharge after you have completed performance of your repayment plan, which usually returns 5 to 20 percent of the total value of general unsecured claims to creditors over a period of three to five years.
One of your bankruptcy lawyer's main jobs is to give you an accurate idea of what your discharge will mean for you. At Daniel Shay Law in San Diego, we carefully review your financial circumstances to identify the debts eligible for discharge and make sure you understand that you're probably stuck with such debts as student loans and recent taxes.
Another important function of your bankruptcy attorney is to identify circumstances that could jeopardize your right to a discharge, and to steer you clear of mistakes. If you've recently drawn cash advances from a credit card account, don't file for bankruptcy next week, or even next month. Make sure you've disclosed your income and assets completely and accurately as well. Omitting assets from your bankruptcy filing essentially invites objections to discharge, and might result in dismissal of your case.
We work closely with all of our clients to make sure that you're in a position to get the maximum possible benefit from your bankruptcy discharge. We also advise people about the best ways to rebuild credit. Although a bankruptcy case will stay on your credit report for ten years, your credit score can improve rapidly if you carefully manage your opportunities to obtain credit.
To learn more about the discharge of indebtedness or the best ways to deal with the consequences of bankruptcy, contact Daniel Shay Law in San Diego for a free consultation.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code.
