Credit Archives - Page 6 of 82

Bankruptcy Law, Credit, Credit Card Debt, Debt Relief, Timothy Kingcade Posts

Floridians Hold Some of the Highest Amounts of Credit Card Debt in the Nation

Posted on June 8, 2018by Admin

Credit card debt is a problem for many Americans, but according to a recent study, it seems to be a more significant problem in Florida. In fact, the Sunshine State has been ranked among the top three states where residents hold the highest amount of credit card debt.

Florida residents carry a total balance of $59.2 billion in credit card debt, as of the end of 2017. The State of California tops the list with its residents holding $106.8 billion in credit card debt, followed by Texas at $67.3 billion.

Interestingly enough, California has traditionally been known to be a state where individuals need to earn the most income to be considered “wealthy” by most standards. Considering the high level of credit card debt residents in California carry, this leads one to conclude that this “income” involves resorting to the use of credit cards, instead of solely relying on earnings.

According to the report, the states with the highest amounts of credit card debt in 2017 were:

California $106.8 billion
Texas $67.3 billion
Florida 59.2 billion
New York $58.1 billion
Pennsylvania $33.2 billion
Illinois $32.2 billion
New Jersey $29.6 billion
Ohio $26.7 billion
Virginia $26.5 billion
Georgia $26.3 billion

Florida residents were also in the top ten for credit card delinquency rates, meaning balances were left unpaid for 90 or more days. Nationally, approximately 7.5 percent of credit card debt was delinquent by these standards. Florida was above this average figure and ranked third in terms of delinquency reported.

The report stated that credit card balances on a national level declined between the years 2008 and 2013 but began to rise again in 2014. As of 2017, more than 470 million credit card accounts were open, totaling $3.5 trillion. The total debt figures were compiled by the Federal Reserve Bank of New York. The full report can be viewed here.

If you are struggling with credit card debt and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:

https://patch.com/florida/southtampa/florida-among-states-highest-credit-card-debt

Bankruptcy Law, Credit, Timothy Kingcade Posts

Steps to Take if Your Personal Debt Goes to Collections

Posted on June 5, 2018by Admin

When someone is facing serious amounts of debt, it can feel like there is no end in sight. Odds are the individual is fielding continuous calls from debt collectors, all of whom are threatening legal proceedings if the person does not pay the debt owed. However, certain steps can be taken to help handle personal debt issues and hopefully avoid a lawsuit.

1. Review the Debt in Question.
The first step is to review the debt amount. Do not automatically trust what the debt collector is telling you, the debt they are attempting to collect could be expired or past the statute of limitations. It is recommended that the person facing the debt collection action first examine the information provided, research the collection agency that is reporting the debt and see if any discrepancies exist. The debtor has 30 days to verify that the amount is correct after the collection agency has contacted him or her. Take advantage of this time and carefully review the debt before making any payments.

2. Dispute an Incorrect Debt.
If, during this 30-day period, the individual discovers any figure that is inaccurate or unusual, it is recommended that he or she report this and provide proof that it is inaccurate. It is possible that the debt collection agency will clear up any discrepancy and adjust it as necessary.

3. Be Aware of the Fair Debt Collection Practices Act.
Not many individuals are aware that they do, in fact, have rights when it comes to collections. Simply because someone has missed a payment and has fallen delinquent does not mean that he or she has no rights. The Fair Debt Collection Practices Act is a federal law that protects the rights of consumers against harassment and aggressive collection practices by third-party collection agencies. Take the time to review the law and to understand what these rights include.

4. Discuss Payment Options.
If the debt is valid, it can help to talk with the collection agency about payment options. At the end of the day, these companies would rather be paid than have the debt be discharged in bankruptcy. Talk with the company to see what payment options are available. The consumer should examine his or her household budget to see what can be done to make payments to repay this debt.

5. Negotiate the Debt.
Another option that many consumers do not realize they have is to negotiate the debt. Many debt collectors or creditors are quite open to discussing other options for payment. If the individual is facing extreme circumstances or hardships, the creditor or collector may be willing to at least reduce the amount of debt owed or extend the deadline for payment.

6. Know the Statute of Limitations.
Every legal matter comes with its own set deadline for when legal claims can be made. Every state has its own statute of limitation for how long debts can be pursued. It is important that the consumer research what his or her timeline is and know what actions affect this timeline.

7. Be Aware of the Timeline.
After the collection proceeding is over, the debt will stay on the person’s credit report for seven years. This seven-year timeline does not start from when the delinquent account was originally opened but rather seven years from the time it became delinquent. Being aware of this fact can help when negotiating a payment on the debt since a paid debt will be viewed more favorably than one that continues to remain unpaid.

8. Understand the Consequences.
It is equally as important that the individual know what the consequences are to leaving a debt unpaid for too long. It also helps to know what the consequences are of ignoring a legal action if one is eventually filed. If the person is sued, it is extremely important that he or she at least appear in court and respond. It can be tempting to just ignore the matter, but by not appearing in court, the individual is likely to lose by default judgment and could have their wages garnished.

Click here to read more on this story.

If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

When will a Bankruptcy be removed from My Credit Report?

Posted on May 31, 2018by Admin

Making the decision to file for bankruptcy is never an easy one. Many people hold off on filing for fear of what bankruptcy will do to their credit once all is said and done. However, having a bankruptcy filing on a credit report does not necessarily mean the end of your finances or your ability to access new credit in the future. It is possible to begin rebuilding credit after filing for bankruptcy.

What Type of Bankruptcy?

The most common types are Chapter 7 and Chapter 13 bankruptcies. Chapter 7 bankruptcy is also known as a liquidation bankruptcy. This type of bankruptcy involves the bankruptcy trustee liquidating assets that are not otherwise exempt and paying off the qualified debts with the proceeds. Chapter 7 bankruptcy allows you to get a fresh start financially and erase past debts, but a legitimate concern consumers have is the effects it will have on their credit score and their ability to take out credit again.

A Chapter 7 bankruptcy filing will take approximately 10 years from the date of filing before the case will come off of the filer’s credit report. On the other hand, a Chapter 13 bankruptcy is known as a reorganization bankruptcy. This case allows the filer to work with the bankruptcy trustee to put together a repayment plan to pay for some or all of the filer’s debts over the course of three to five years. A Chapter 13 bankruptcy case will be automatically deleted from the person’s credit report seven years from the date of filing.

Can the Process Be Faster?

It is possible to have the bankruptcy removed from the person’s credit report sooner than is normally allowed. There is a big misconception that bankruptcy cannot be removed from a credit report and that you will be penalized for 10 years, not being able to access new credit. The truth of the law or the way law is written, there’s a maximum amount of time a bankruptcy can remain on your report, but there is no minimum amount of time.

This is done by filing a dispute with all three of the credit bureaus. It is recommended that the person reviews the bankruptcy filing and the specific debts related to the bankruptcy that appear on the credit report. If any incorrect items are found, the person can file a dispute.

When a credit dispute is filed with one of the bureaus, it must be verified and validated for it to stay on that person’s credit report. If the disputed items are not verified within 30 days of the dispute, they must be removed from the credit report, including bankruptcies.

Getting Back on Your Feet.

Chapter 7 bankruptcy allows you to get a fresh start financially and erase past debts, but a legitimate concern consumers have is the effects it will have on their credit score and their ability to take out credit again.

One of the biggest misconceptions about filing for bankruptcy is that it will ruin your credit score and your financial future. To the contrary, after filing for bankruptcy you can begin restoring your credit right away.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Millennials Struggle to Keep up Financially with Previous Generations

Posted on May 22, 2018by Admin

The financial crisis may have hit the ’80s generation the hardest. Americans who were born in the 1980s, otherwise known as “millennials,” are finding themselves struggling financially more than generations before them. Following the Great Recession, which began in 2007, individuals born in the ‘80s are at wealth levels which are 34 percent below where they would be had the financial crisis not occurred. Most millennials have to save longer to buy a home, struggle with student loan debt and rising home prices.

The generation known as “millennials” is categorized as being born between 1981 and 1996. According to a report issued by the Federal Reserve Bank of St. Louis, people in this generation are at risk of being termed “the lost generation.”

“Not only is their wealth shortfall in 2016 very large in percentage terms, but the typical 1980s family actually lost ground in relative terms between 2010 and 2016, a period of rapidly rising asset values that buoyed the wealth of all older cohorts,” the report says.

This can be attributed to a number of factors. One major setback this generation faced was entering the workforce as the financial crisis was beginning. In fact, this generation seems to have been hit the hardest for this very reason. Entering the workforce at the time of a recession put these young workers at an immediate disadvantage for earning an income, as well as saving money towards big purchases or retirement.

Once the recession passed and the economy began to improve, these individuals faced difficulty in recovering from the hard hit.

Millennials have been on the receiving end of a 67 percent increase in wages since 1970, but this increase in pay has not kept up with the rising costs of living, including rent, home prices, college tuition, costs for childcare, healthcare, and entertainment.

This generation also has to deal with large amounts of credit card debt, on top of six figure student loan debt. After graduating from college at a time when jobs are not as prevalent, these individuals have had to resort to credit to pay for these expenses.

If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:

http://www.businessinsider.com/1980s-millennials-wealth-the-great-recession-2018-5

https://blogs.wsj.com/economics/2018/05/21/crisis-hits-1980s-generation/

Bankruptcy Law, Credit, Debt Relief

Rent-A-Center Accused of Kicking in Doors and Crushing Customers’ Credit

Posted on May 21, 2018by Admin

Rent-A-Center has recently made headlines due to its unethical treatment of customers and harassing debt collection practices. In fact, it has gotten so out of hand that the complaints and harassment lawsuits have grown in numbers.

Rent-A-Center customers throughout the U.S. are now complaining that Rent-A-Center has virtually destroyed their finances after they have leased electronics, appliances and furniture from the company.

Rent-A-Center is a Texas-based publicly-traded company. The company started in 1986, offering consumers a way to purchase electronics and other household items that they would not be able to afford otherwise. The customers rent these items, making payments on a monthly, semi-monthly or even weekly basis. At any time during the lease, the customer can terminate the lease and return the household goods, or they can keep making payments until they own the items in full. The company’s mission aims to help those in lower-income households by allowing them to purchase items they would not otherwise be able to afford.

Once a customer begins to fall behind on his or her payments, that is where issues arise. Just one missed payment, missed by something as small as a day, can trigger aggressive collection efforts.

One federal lawsuit, brought by a Florida resident, claimed that she was forced to hide in a closet with her two young sons while a Rent-A-Center employee pounded on her door to collect payment on her rented household items. Another lawsuit claims that a Rent-A-Center worker kicked in her front door after she fell behind on payments for her laptop computer.

Even debt collectors are complaining about the practices of Rent-A-Center. In 2014, the collection company, Acceptance Now, took on accounts from Rent-A-Center, but as soon as debt collectors began making efforts to collect on the accounts, customers continually informed the agents that their debts had already paid. The problem was Rent-A-Center’s records did not reflect these payments.

Many states allow rent-to-own companies, like Rent-A-Center to file criminal charges against customers who do not pay on their rental agreements and do not return items when asked to do so. The collectors are well aware of this information, and Rent-A-Center regularly uses these threats to scare customers into making payments. It can make customers feel trapped in a no-win situation, not only fearing for their safety against aggressive collectors but fearing jail time if they are not able to make payments.

Between January 2016 and June 2017, the Federal Trade Commission received 2,779 complaints regarding both Rent-A-Center and Acceptance Now. Out of these complaints, 90 percent of them involve aggressive collection tactics, involving employees banging on customer’s houses and blasting car horns outside of homes.

Know your rights when it comes to creditor harassment. The Fair Debt Collection Practices Act (FDCPA) was designed to help prevent creditor abuse and harassment.

Click here to read more on this story.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

10 Things Debt Settlement Companies Won’t Tell You

Posted on May 17, 2018by Admin

When facing overwhelming debt, it can seem like there is no way out, the thought of a third-party debt settlement company coming in and negotiating down the debt can seem like a dream come true. While it can be tempting to jump at this offer, there are several important facts that debt settlement companies will not tell you.

It is important to first understand what makes a debt settlement company different from the normal credit counseling service. A debt settlement company assists in negotiating down the individual’s debt. To qualify, the individual must stop making payments on any debts. All of the late fees, interests and penalties will continue to grow during this time, and the debtor will make payments to an escrow account held by the debt settlement company. When a specified amount has been saved, the company contacts your creditors and tries to get them to accept a lower amount to settle the debt.

If it seems too good to be true…

The consumer facing mounds of debt is able to settle the case for less than what he or she owed. In return, the debt-settlement company collects fees from the consumer for having to negotiate the debt. However, like many things that sound too good to be true, it is not always that easy. In fact, the consumer can end up in a much worse financial situation than they were in before. The debt settlement company, on the other hand, comes out earning fees on the payments made by the consumer. Many times, the consumer will never end up seeing the light at the end of the tunnel and will end up filing for bankruptcy anyway. In the meantime, he or she has been making payments in an escrow account, while accruing fees and costs accumulate.

Debt settlement is not an easy process.

The individual has to basically stop paying his or her bills and let all debt go into delinquency or default. The money that would be going towards the debt goes towards the debt-settlement firm and into an escrow account. By stopping payments on current debts, the creditors are supposed to be fooled into believing they will never receive payment, which will make them desperate to take a lower settlement. However, until that happens, it does not mean the collections efforts will stop. The creditors will want to receive payment and will continue doing anything they can to receive it. The debt settlement firm cannot stop the calls from coming, and they cannot stop the collection efforts during all of this.

Debt-Settlement Companies Cannot Ask for Upfront Fees

In 2010, the Federal Trade Commission made it illegal for for-profit debt-settlement companies to charge upfront fees. Firms are not allowed to collect fees from the consumer before they have settled the debts. If the company is settling debts one debt at a time, fees can be collected on that settled amount, but they are not allowed to ‘front-load’ fees.

There are other alternatives to debt relief.

Other debt-relief options are out there. Credit counseling is available, and many non-profits offer education for consumers on how to get rid of debts. Debt management programs offered through non-profit credit counseling services are also available. Additionally, if all else fails, bankruptcy is an available option. It helps to sit down with a bankruptcy attorney to discuss the possible options, as well as the best ones for the specific debtor.

Debt-Settlement Will Not Save Your Credit Score.

The fact that the consumer simply stops paying his or her credit cards, letting them go delinquent means that the individual’s credit is going to take a hit. Even missing a payment for 30 days means that the consumer’s credit score is going to get hit. Once that happens, it can be hard to get it back.

The Consumer May Still End Up Filing for Bankruptcy.

When all is said and done, the debtor may end up back at the point where he or she would have ended up had he or she not sought debt-settlement. The bankruptcy process provides some protections for debtors that debt-settlement does not. All collection efforts stop with the automatic stay, including the fees from accruing. Also, the Chapter 13 bankruptcy process allows a more structured way for the individual to pay back the debt.

Not All Debt Will Be Settled.

It is possible that the debt-settlement company may not end up settling all of the debt. They normally deal with liabilities that are unsecured, like credit cards, medical bills and unsecured loans. Debts that have collateral attached to them, such as mortgages or car loans, can be a little more difficult. Creditors are not under an obligation to work with debt-settlement companies, which is why many debts end up not being successfully settled.

Debt Settlement Lawyers Do Not Represent You.

Many debt-settlement firms will tell consumers that their attorney represents them in negotiations with the creditors. However, half the time that means the attorney is basically letting the debt-settlement company utilize their letterhead. Most of the time, the attorney on the letterhead will never truly represent the consumer, and consumers should never assume or rely on false promises that they are legally protected by representation.

You don’t need them.

One big issue debt-settlement companies do not want you to know is that you can do this alone. Nothing prevents a consumer from negotiating a settlement directly with the creditor. Many consumers are actually successful in working with creditors on a mutually-beneficial solution, independent from third-party intervention.

Prepare for Tax Consequences.

The Internal Revenue Service considers debts that are forgiven, cancelled or discharged to be taxable income. If a consumer is successful in reducing or paying off their debts through settlement, they may still owe taxes for the amount that has been written off. In fact, consumers will receive a 1099-C form for any debt that applies as income, and this will need to be reported as gross income for taxes. The only exception to this rule is for taxpayers who are insolvent, meaning they owe more than they own.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Yahoo Users Can Sue Over Data Breach

Posted on May 15, 2018by Admin

A federal court has recently ruled that a lawsuit regarding Yahoo’s recent data breach, exposing the personal information of its nearly 3 billion users can go forward. The decision was announced on May 11, after U.S. District Judge, Lucy Kohl, rejected a request from Verizon Communications to dismiss many of the claims made against the company for negligence and breach of contract. Verizon Communications purchased Yahoo’s Internet business in June 2017.

The case stems from three different data breaches that occurred between 2013 and 2016. Yahoo has been criticized with how slowly it reacted to the breaches and informed their users. The breaches were not discovered and revealed until after Verizon agreed to buy Yahoo’s business. Upon discovering this news, Verizon demanded a $4.5 billion cut in the purchase price for the company.

Customers were later informed about the release of confidential information, which increased users’ risks of identity theft. Users were then required to pay for credit freezes and continued monitoring on their credit reports.

Kohl stated that, had customers been informed about the breach sooner, they would have taken measures against identity theft and fraud. By the time the company had informed users of the breaches, many of them had already had their identities stole by hackers who used their personal data to file fraudulent tax returns and make illegal credit card charges.

Initially, the company had said that one billion users were a part of the hack, but it later came out that three billion of the users were affected by the breaches. In fact, the complaint filed by plaintiffs had to be amended in October 2017 after it was revealed that the breach ended up affecting three billion users.

Kohl said the fact the complaint had to be amended to include these additional users highlighted just how serious the issue of security was in the plaintiff’s decision to use Yahoo as an Internet service.

In March 2017, two Russian intelligence agents and two hackers were charged by U.S. prosecutors for crimes connected with the Yahoo breaches. One of the accused hackers, Karim Baratov, pleaded guilty to aggravated identity theft and conspiracy charges.

If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorneywho can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Related Resources:

https://www.consumeraffairs.com/news/yahoo-users-can-sue-over-data-breaches-031318.html

https://www.reuters.com/article/us-verizon-yahoo-breach/data-breach-victims-can-sue-yahoo-in-the-united-states-judge-idUSKCN1GO1TL

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

How Student Loan Debt Can Affect Your 401K

Posted on May 14, 2018by Admin

Student loans and retirement planning may not seem like two things that would affect each other. Usually, the first thought after graduating is to get a job to start paying back student loan debt. However, student loan debt has become an increasing problem when it comes to saving and planning for retirement.

More and more students are graduating with student loan debt today. And for those starting their careers fresh out of college, many are finding it hard to save for retirement along with meeting their monthly obligations, the biggest of these being student loan payments.

New research shows that families age 45 to 54 with zero student loan debt have an average 401(k) balance of $80,000. Take that same age demographic and add the issue of student loans, and the median balance for their 401(k) drops to $46,000. Families who have heads of household younger than 35 with student loans carry a median 401(k) balance of $8,000.

Some companies are helping their employees with student loan debt. In January 2016, Fidelity launched a program to help their own customer service associates pay up to $2,000 of student loan debt annually, with a lifetime maximum of $10,000. Fidelity employees responded well to the program with 8,400 employees taking advantage of it, the majority of them being in the younger demographic.

Another company, Gradfi, a fintech company, started a student loan repayment program, offering this service to 100 employers in 2016. Gradfi is now working with 350 companies across the United States, including Peloton and Pricewaterhouse Coopers. Employers can use these programs to draw in key hires, but also work on retaining employees once they are hired.

One downside to these student loan repayment programs, however, is the fact that these employer payments must be considered as taxable income to employees.

For the time being, it is advisable to factor in both payments on student loan debt and contributions to retirement savings. Every bit helps and making those smaller contributions today will build up to larger contributions over time as student loan debt decreases. Take advantage of employer-matched money when making these contributions, and speak with your financial advisor to see how much you can contribute comfortably.

Click here to read more on this story.

For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Debt Relief

5 Ways to Erase Your Credit Card Debt

Posted on May 9, 2018by Admin

Credit card debt can be frustrating to no end and is easily one of the most common debts individuals who later file for bankruptcy find themselves battling. Every situation is different, and while there is not a single solution for getting out of credit card debt, certain tips and tricks can help individuals who find themselves drowning in this type of debt.

Use All Resources to Pay the Debt

The most common method used in the past was to take all resources available to pay off the debt. While it is an effective method, it is one that requires a lot of dedication, as well as a lot of time. It starts with the individual cutting up their credit cards and using cash only to pay for essential living expenses. It is recommended that the person first sit down to make a list of all cards he or she has, writing down the interest rate for each card, as well as the minimum payment on each.

Utilizing what is known as the “debt avalanche” method, the person targets one credit card balance at a time. This means that the person pays the minimum payments on all other cards with the exception of the first card with the highest interest rate. To come up with the amount the borrower can afford to pay towards this car, he or she will need to create or revise a budget, eliminating all unnecessary expenses, and see what amount is left after all living expenses are covered. The person will throw all of the money towards the first debt, and as soon as that debt is paid, the card with the next highest interest rate is handled and so on until all debts are paid.

However, when the card’s interest rate is too high, the individual has too many debts to handle or he or she has no extra money to contribute to paying the cards off, other options may need to be used.

Balance-Transferring Card

If the individual still has a good credit score, it is possible he or she could transfer the balance from one or more of these cards to a newer one with a lower interest rate. Many cards offer a limited-time 0 percent annual percentage rate for a certain period of time and waive a balance transfer fee during this period. This time period can allow the payer a chance to catch up without the debilitating interest rates preventing any progress. However, the key is the person needs a good credit score, as well as savings or funds available to pay off the balance during this period of time with 0 percent APR.

Credit Card Consolidation Loan

Sometimes paying off the credit card debt can be too much to pay without help. In these situations, credit card consolidation loans are a possibility. According to Bankrate, the average rate for these loans is 16.84 percent for credit cards these debtors are facing, which can be near impossible to conquer. A credit card consolidation loan allows the person to pay off the credit card balance with a loan for the same amount but a lower rate. The rates for these loans start around 10.00 percent with lower fees than the credit cards. These personal loans are available for borrowers with less than perfect credit, but the borrowers will need someone to cosign the loan or at least put up collateral to cover the loan.

Debt Management

Another option is for the borrower to enroll in a debt management program or plan (DMP) and receive assistance from a credit counseling service. A qualified credit counselor will work with the individual to put together a budget, create a plan to pay off the debt and to work with the creditors to negotiate the debt. Also, under a DMP, the person will consolidate the debt into one monthly payment with a small monthly fee that is capped by the state. This option is available for individuals with poor credit, and the process can take approximately four to five years.

It is important that the person find a company who is qualified, such as the Financial Counseling Association of America. If a company promises the debtor that it will be able to completely get rid of the debt, it is likely a scam. Do the homework before choosing a company.

File Bankruptcy

Sometimes, the individual has no choice but to file for bankruptcy if the amount of debt is too much to handle. It is at this point that a bankruptcy attorney needs to be consulted. An attorney can help the person determine whether other options exist, and if no other option does exist, the attorney can advise the individual on what type of bankruptcy is best for his or her situation, whether that be Chapter 7, 11 or 13 bankruptcy.

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

How to Recover After Bankruptcy

Posted on April 20, 2018by Admin

Even the most financially responsible people can fall on hard sometimes, whether it be a sudden illness, job loss or divorce. As many as 78 percent of full-time workers said they live paycheck-to-paycheck and 71 percent are already in debt, according to a recent study by CareerBuilder. With statistics like this it is not surprising how quickly finances can spiral out of control.

Having to file for bankruptcy can take an emotional and financial toll, but sometimes it is the only option. In 2017 alone, there were 765,863 non-business bankruptcy filings, according to the Administrative Office of the U.S. Courts.

While you cannot offset the impact of bankruptcy to your credit, there are things you can do to improve it over time.

While each case is different, bankruptcy can completely wipe out credit card debt, medical bills, personal loans, past-due utility bills and even rent. Rebuilding your credit after bankruptcy can start by sticking to a budget and paying all of your bills on time.

A powerful tool to help improve your credit score is a secured credit card. These cards require a deposit, which can be equal to your spending limit. Applying for new credit too soon or having multiple denials can hurt your credit even more.

One of the biggest myths about filing for bankruptcy is that it will ruin your credit score and your financial future forever. To the contrary, after filing for bankruptcy you can begin restoring your credit immediately.

Still not convinced? A testimonial from one of our clients in regards to their credit score after filing for bankruptcy.

My credit score said on all three reports 775, I couldn’t believe that I had such a great score before 10 years. Tim for me was the best move I have made for my situation. I have no regrets, I am glad the past is the past. – Bill T.

Click here to read more on this story.