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Cleveland TN Bankruptcy Law Blog

Exemption planning as part of the bankruptcy process

One of the most basic services our law office offers Bradley County, Tennessee, residents is helping a debtor fill our his or her bankruptcy forms correctly. Indeed, bankruptcy clients have the right to expect that their attorneys will make sure that their official forms will be accurate and complete. If they are not, it can land the debtor in to a lot of trouble and even keep them from being able to get debt relief.

However, correctly filling out forms is the minimum duty of a bankruptcy attorney. A quality attorney, like the specialist at our law office, understands the full consequences of what a debtor says, or does not say, on his or her forms.

How does the CARD Act protect Tennessee families?

It is bad enough to deal with credit card debt, particularly when someone, at the same time, also has other issues, like unemployment or mounting medical bills from a recent and unexpected procedure. It is even worse when credit card companies take advantage of their customers, and families do not realize it until it is too late.

Fortunately, federal law offers some protections to families. About a decade ago, Congress passed the CARD Act, which was designed to protect consumers in Tennessee and around the country from the most common and aggressive techniques of credit card companies.

Survey: Americans amass over $1,000 in holiday debt

According to a recent survey, Americans on average picked up $1,054 in debts related to their holiday spending this season. Of this debt, over two-thirds of the people survey said they used a credit card to finance it.

Additionally, more than 15 percent of those surveyed said that while they did not use a credit card, they did use an in-store card, which operates in basically the same way as a credit card would.

Alternatives to reaffirmation of debt

A previous post on this blog talked about when a Bradley County, Tennessee, family might consider signing a reaffirmation agreement, which, as that post discussed, means that the reaffirmed debt is not affected by the bankruptcy.

Some people may balk at signing these sorts of agreements, however, especially since they mean that a creditor or their debt collector will have full legal power to take collection actions on that debt, including issuing garnishments and freezing one's bank account, for many years.

Should you sign a reaffirmation agreement?

When a Bradley County, Tennessee resident has to file bankruptcy, they often have several debts secured by collateral, or property the debtor owns but promises the bank or financing company can have if the debtor does not make good on his or her loans.

As previous posts on this blog have discussed, from a long term perspective a Chapter 7 bankruptcy will not protect a debtor's collateral from getting taken if they have fallen behind in their payments. Assuming they are not behind in their payments, though, they may get what is called a reaffirmation agreement from the creditor.

Review of alternatives to the bankruptcy process

At our law office, we believe that our clients deserve the opportunity to explore all options for resolving their debt should they run into financial trouble. While we do not hesitate to recommend bankruptcy to a southeastern Tennessee resident when that really is their best financial option, we also will not hesitate to let families know when they should consider trying another approach.

After all, while bankruptcy can give a family the fresh financial start they desperately need, it comes with some sacrifices. For one, a person's credit score is always going to take a hit after that person files for bankruptcy, making it harder for that person to get loans and other financial advantages in the short term.

How one can wipe out car, other debt in bankruptcy

As this blog has discussed previously, residents of Bradley County and other parts of southeastern Tennessee can avail themselves of the country's bankruptcy system should they find themselves in trouble financially.

Whether it is a Chapter 7 or Chapter 13 bankruptcy, the system exists to give honest families who have run into financial problems the chance to get a fresh start while still ensuring that creditors get treated fairly.

How Chapter 13 bankruptcy helps stop foreclosure

As this blog has mentioned previously, when family in southeastern Tennessee files for bankruptcy protection, they get the benefit of having immediate relief from all debt collection efforts, which includes foreclosures.

However, at least in a Chapter 7 bankruptcy, the protection from foreclosure only lasts so long. This is because, if a family falls behind in payments, no bankruptcy will stop the mortgage holder from taking back the home eventually, even though following a bankruptcy the mortgage holder can no longer turn around and sue the family personally. Usually, if a family is significantly behind on their mortgage payments, all a Chapter 7 does is drag out the process.

Black Friday scary prospect for those in credit card debt

What started as a fun family tradition of going shopping on that extra day off after the Thanksgiving holiday has become an all out shopping extravaganza. Some may still love Black Friday for the deals people can get in the check out lines, while others have grown less enthusiastic or even disdainful about this unofficial American holiday.

Still, two out of three people, assuming they shop at all, plan to be in the stores on Black Friday. The problem though is that on Black Friday, and during the four our so weeks afterward, many people in southeastern Tennessee and other parts of the country bite off more than they can chew. Some studies estimate as many as 40 percent of households spend more than they should on their Christmas gifts.

Are business owners subject to the "means test"?

A previous post on this blog discussed how a bankruptcy can help a sole proprietor, that is, a person who conducts business in his or her own name and does not incorporate, manage their business debts and keep their enterprise afloat while they reorganize.

Bankruptcy is also beneficial for business owners who chose to incorporate or otherwise organize their business. This is because most banks and creditors will require individuals who own a business, even if it is incorporated, to sign documents promising to pay all business loans if the business fails. These documents may even require a person put up his or her house or car as collateral.

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Richard Banks & Associates

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Cleveland, TN 37364-1515
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