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Debt and Bankruptcy

State of owing money to creditors. A person or organization is bankrupt when judged to be legally insolvent.

4,664 Questions

How does bankruptcy stop foreclosure?

The bankruptcy stay prevents any action by the lender until the BK is finalized. Be advised that a mortgage lender can petition the court to have said stay lifted so foreclosure proceedings can continue. That rarely happens though.

Unless the debtor reaches an agreement with the mortgage holder to reafirm the lending agreement the foreclosure will likely occur after the BK discharge.

How long do bankruptcy dismissal stay on you credit report?

Bankruptcy dismissals typically remain on your credit report for up to 10 years from the filing date. However, the impact on your credit score may lessen over time as you establish a positive credit history. It's important to note that while the dismissal itself stays on your report, the effects on your creditworthiness can vary based on your overall financial behavior post-bankruptcy.

How debt equity ratio improved?

Since the debt/equity ratio is determined as a fraction, you either decrease debt or increase equity. Before 2008, home equity increased yearly, but middle class persons kept borrowing against the equity rather than let it increase. Many mortgages are now underwater - the value of the house is less than the mortgage(s). So increasing equity is difficult.

Debt can be improved by 1)discharging debt in bankruptcy, 2) paying down credit cards, 3)never going over credit limits, preferably staying under half of the credit limit and paying the balance due at the end of the period (not the minimum payment due, the full balance). If you have more than one card, you might want to try paying down one card completely. Picking which card to do that to can get complicated, so you might consult a US Trustee approved debt consultation agency.

How long does bankruptcy in Iowa stay in your credit history?

In general, in the U.S. a bankruptcy stays on your credit 7-10 years. Most people will say 7, but there is no guarantee it will go away after 7.

If a foreclosure lawsuit is filed against you and a default judgment entered and you file a Chapter 7 before auction and foreclosure fraud is discovered can you keep your home if surrendered?

If the home has been sold to a third party, you cannot keep it. If the home has not been sold, you may be able to keep it, but you will have to pay the mortgage arrears, including legal fees and costs unless a court orders otherwise. You may still have problems paying the mortgage, so think about whether you can afford to keep it.

What can occur when a person owes more money than he or she can earn or pay to creditors?

A person can lose everything he or she owns when creditors move in to collect what they are owed. A person might have to go through bankruptcy.

When filing chapter 13 should all debt be included?

when filing any bankruptcy you must disclose ALL debts.

Is chapter 7 bankruptcy clear 10 years from court announcement or hearing date?

Chapter 7 Bankruptcy will be removed from a credit report 10 years after the date the Bankruptcy was FILED.

Can you stop a creditor from selling your account once you have filed bankruptcy?

No. The bankruptcy is to stop anyone who has a right to collect a debt from being able to collect, called the automatic stay. If the debt is listed in the correct debt owner's (creditor's) address and it is discharged, it does not matter who owns the debt.

Who owns home after filing a chapter 13?

It depends on what the chapter 13 plan provides. Most 13s are started to save a home from foreclosure, so the debtor remains the owner until the plan is completed. If the debtor misses post-filing mortgage payments, the mortgagee will file a motion for relief from stay to get the court's permission to proceed with the foreclosure.

The plan can provide for the sale of the house, most often at auction, and the balance of the mortgage becomes unsecured debt to be paid according to the plan provisions for unsecured creditors.

Or the plan can provide for the surrender of the collateral (home) to the mortgagee, with the same result for the mortgage balance.

How do you better your credit after a bankruptcy?

1. Start saving a small amount each month, until you have enough to meet at least 3 months' worth of needed expenses.

2. Develop a budget and stick to it.

3. Pay your bills on time. That means not mailing the payment on the due date, or paying after the due date but before the date set for a penalty, but at least three days before the due date.

4. Get a low-limit ($300-500) card, use it to buy only as much as you can pay in full at the end of the month (or whatever period your card uses).

5. If you have no utility bills in your name, change one to your name, and pay it regularly.

6. If you can, pick a discharged debt to pay. Save the money to make a lump sum payment. The discharge means the creditor cannot take action to collect, but it does not prevent you from paying it.

7. Get your free annual credit report from www.annualcreditreport.com every year and make sure it is correct and up to date.

8. Check your credit score at a free site

9. Do NOT apply for credit at more than on source. Multiple credit applications reduce your score.

Control your spending. Know what you spend. Spend only for what you need and only if you can afford it. If you get gas, don't go into the store to get a soda or a snack. Write down every penny you spend for a week. Lower that amount the following week. Repeat as needed.

Can you file bankruptcy on a debt owed to the IRS?

Yes you can file bankruptcy. Whether or not it is dischargeable is another matter. In a Chapter 13, it could be included in your repayment plan. Not sure how it works in a Ch 7.

Which bankruptcy removes federal taxes?

Federal income tax can sometimes be discharged in a bankruptcy, but there are several rules that apply. Only one example is, federal taxes must be at least three years in arrears before qualifying for bankruptcy discharge.

How much savings are you allowed to keep after filing chapter 7?

it depends on your state exemptions and what you mean by savings... for example, some states provide for 150$ of a bank account to be exempt, meaning everything else will become part of the bankruptcy estate to repay creditors.

How do you find out if someone has filed for bankruptcy?

Bankruptcy court records are public records, unless the court has impounded some or all the information for some good reason. There are banking publications, like Banker & Tradesman, that publish all filings in their area. Some local newspapers still publish bankruptcy filings from their communities. And you can check out the bankruptcy filings at the bankruptcy court for your area. There is usually a public access computer in the clerk's office where you can look for filings by name. A deputy clerk will be happy to assist you.

Can you make a partial payment to the chapter 13 trustee?

You should check with your c 13 trustee. In general you can make a partial payment, but if the next payment is also a partial payment, or if you do not make up the difference, the trustee will file a motion to dismiss your case. It is always a good idea to let the trustee's office know your next payment will be short and why, and when you expect to get caught up.

If you will not be able to continue the c. 13 payments as set forth in the plan, you may be able to end your c. 13 early or convert to a c 7. Consult your bankruptcy lawyer.

Does the bank have to refinance you if you file a value of collateral in a chapter 7 for what the house is worth?

No, it does not. But there may be a change in the law allowing a "cram down" of mortgages, as there used to be in bankruptcy.

Who can apply for car loan after bankruptcy filing?

Assuming the bankruptcy has gone to discharge, the debtor can apply for a car loan almost immediately, as long as the income is enough to qualify. You will pay a high interest rate, though, if you make the payments on time for a year or so, you may be able to refinance. Watch out for "we finance here" dealers. They are often not licensed as lenders and will have you sign a document with a lot of blank spaces. Don't do it.

Go to a credit union or a small local bank, if possible.

If the bankruptcy is still pending, you need permission from the court.

What happens at a sheriff's sale?

A Sheriff's sale usually is to sell off property that has been seized by a large judgement against someone or a repossession that has taken place.

Can you add furniture rental to your chapter 7?

Any Chapter 7 Bankruptcy should include ALL debts owed. Do not make the same mistake that I did and forget any little ones along the way,,,forgotten small balances on credit cards, retail store credits, loans of any kind(you may lose friends over that one but if you want to be debt free then include them also.

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