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Thursday, January 16, 2014

Z is for Zero! Our last installment in our Bankruptcy alphabet series

Zero.  That is how much unsecured debt remains after a chapter 7 or chapter 13 bankruptcy discharge.  

You should be back on track now, debt free.   There are a few exceptions.  Student loans or educational debts do not discharge in bankruptcy.  Some tax debt, unless paid in full could survive a chapter 7 bankruptcy.  Child support, spousal support, alimony, or any other Domestic Support Obligations remain after bankruptcy too. 

If a debtor chooses to reaffirm a debt, and the court approves it, then that debt would survive as well. 

Cosigners are always on the hook for what they signed on too.

So, a bankruptcy case, whether chapter 7 or chapter 13, can definitely get a debtor a fresh start.

Call Leeders & Associates if you want to get out of debt with a bankruptcy discharge.  313-346-7400

www.leederslaw.com
www.chicagobankruptcynetwork.com
www.facebook.com/leederslaw


Monday, January 13, 2014

Y is for You Did It! You got a bankruptcy discharge!

Y was a tough letter to find to post about for bankruptcy.
Not many bankruptcy terms begin with the letter Y, there isn't much caselaw that starts with the letter Y.
No Judge has a name that starts with a Y in Chicago

So, I figure I'll sell the benefits of bankruptcy, with Y is for YOU DID IT!
You completed the bankruptcy case.  3 months for chapter 7, and 3 to 5 years for most chapter 13 bankruptcy cases.    So, now what?

It is a good idea to check your credit report a few months after bankruptcy.  This is a new service we are providing for interested clients.  We'll help to make sure all items are being properly reported.
You worked hard and paid a lot of money to get your credit back on track, so make sure it's being done correctly.

You should see an increase in your credit score after bankruptcy as well.  My research shows that most credit scores are predicted to jump up 50-100 points in the first year after bankruptcy.  This assumes the debtor doesn't go crazy and apply for every offer they see!  If the debtor stays on track, pays all of their bills on time, they should see an increase.  

Don't hesitate to take new debt, but only if you need it.  You'll get bombarded from tons of companies who gather your info from the bankruptcy filing and send you offers of new credit. Be smart, throw most in the trash.  You'll notice huge interest rates and tempting offers that aren't as good once you start reading the small print.

Take out a small credit card.  Use $50 each month on it. But pay off that $50 each month in full, on time as well. That will help your credit score for sure.

My clients are getting credit card and loan offers the first month after the case.  They are getting car notes the first month out of bankruptcy in Chicago as well.  Watch those interest rates and long car notes - 6, 7 years! Yikes!  My clients in the Chicago area who file bankruptcy are also getting mortgages as well within a few years out of bankruptcy.  

Nothing is set in stone, so feel free to seek out the credit, but only if you need it.  Keep your payment history clean, pay your bills on time.  That can take a few years before this has a major positive impact on your credit score, but every month counts.

Make a budget for yourself.  Be honest with yourself as well.  You had to take 2 counseling classes during the bankruptcy process,  use what they have provided to help keep you on track to financial freedom.

Don't forget, your attorney is a great tool as well to use, to help with issues you may be having.  They are a great source of referrals too, and have many vendors who are bankruptcy friendly if you need a car, a credit card, loan etc.  

Congratulations, you are out of debt and have a fresh start!
www.leederslaw.com
www.chicagobankruptcynetwork.com
www.cookcountybankruptcy.com

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