Preliminary low interest rate attracts the customers to transfer their balances from the current accounts to a new one. The new credit card companies tempt the customers so much that they often miss out to detect the hidden fees and costs of transferring the balance. They also forget that the offer of low interest rate lasts only for few months or a year. Soon the introductory offer rises, sometimes even higher than the original credit cards. It even gets canceled if you cannot pay the interest before time. The introductory offer is often applicable only to the balance transfer, and different rates are charged on different purchases. Even common fees are charged, which include monthly finance fees, balance transfer fees, cash advance fees and annual fees. Thus, borrowers often end up paying more fees than saving the amount with the low interest rate.

Your credit score may also be affected if you frequently transfer your balance. Frequent balance transfer indicates on your credit report that you had more credit debts than you could handle, and thus your credit score drops. Frequent balance transfer also increases the risk of not getting any more new credit cards in future.

Thus, you should transfer your balances from the current accounts to a new reduced introductory offer considering all the pros and cons. Balance transfer exacerbates the problem more rather than reducing or eliminating the debts.  So remember balance transfer is not a desirable and a long term process to manage your debts and can never be considered a substitute of bankruptcy.

Know about the pre-filing requirement for chapter 13 bankruptcy:

According to the U.S Bankruptcy Code, you have to undergo certain pre-filing requirement and they are as follows:

1. You have to go through a credit counseling briefing after getting approval from the U.S Trustee.
2. Provide your credit counseling certificate along with your bankruptcy petition. If you are unable to file this certificate then your bankruptcy petition will be dismissed.

Know about the eligibility criteria to file under chapter 13 bankruptcy:

• Filers who want to protect their non exempt property
• People with stable income
• People who can strictly follow a disciplined repayment plan

Know about the repayment plan under chapter 13 bankruptcy:

A trustee appointed by the bankruptcy court will review your financial situation and then he will accept the repayment plan proposed by you. The payment is distributed among the creditors after the approval of the plan.

Under chapter 13 bankruptcy you can pay off your own debts. You can avoid dismissal of the petition if you provide the required documents before the court.

Chapter 13- Wage earner’s bankruptcy:

Chapter 13 is commonly known as wage earner’s bankruptcy. The trustee appointed by the court prepares a budget so that you are successful in paying off the debt within 5 years.

Do you know about “Automatic Stay”?

The creditors will not be able to collect the debt illegally after the automatic stay has been placed. If the creditor files a lawsuit against you then it will be put on hold if the automatic stay is placed. The case will start after the bankruptcy case gets over.

A petition is filed which would state that the debtor won’t be able to pay the debts that is owed by him. A court procedure is involved before filing for bankruptcy. The debtor gets a debt relief but he has to pay for an easy get away as its after effect is very harmful. There are two types of consumer bankruptcy which are specially found in US and California: Chapter 7 bankruptcy and Chapter 13 bankruptcy. The bankruptcy lawyers are there to you help in the court proceedings.

What are the ill effects of bankruptcy?

Filing for bankruptcy can ruin your credit report as it stays on your record for 10 years. It makes things difficult for the bankrupt as he can not acquire credit to buy new home or indulge into any luxurious products. Debts like student’s loan and back taxes are two prime example which fall under non dis chargeable debts even after filing bankruptcy.

Bankruptcy is all about disrobing yourself in public. As you have to declare in the news paper as well as in the court paper that you are “bankrupt”. An explanation has to be provided to the judge for the cause of filing bankruptcy and how you got into such financial catastrophe.
Filing bankruptcy would not only bring down bad name upon you but also to your family. It would make your life difficult as it would be hard to find a job and no one would easily rely on you.

Difference between chapter 7 and chapter 13:

A Chapter 7 bankruptcy, is quite familiar as a liquidation bankruptcy. The debtors have to surrender all non-exhausted assets to the court. The assests would be sold off for repayment to the lenders. Chapter 7 bankruptcy gives provision to the debtors to keep property for instance cars, their home, retirement,accounts, and so on. After the assests are sold, the amount would be well distributed among the creditors.

There are three general characteristics for filers in Chapter 7 bankruptcies:

1. People with irregular or irratic income usually file for bankruptcy.
2. People with assets the are taxable property such as home, vehicles, and retirement accounts
3. They would fail to pay on a regular basis on a repayment plan

Chapter 13 bankruptcy results in a repayment plan, the debtor submits the expected amount to the court. The repayment plan is designed in such a way that it reduces the total amount of debt and it is a five year plan with in which the debtor has repay. Once the court approves the plan and after the payment has been made by the debtor then the borrower can lead a debt free life.

Bankruptcy is opted by people who are:

• Does not want to lose their non-exempt property
• Has a regular flow of income
• Can follow a disciplined payment plan and can stick to budget.

So these are the few marked differences found between chapter7 and chapter13. Although it is advisable not file for bankruptcy. As it has negative effect on credit record.

Filing your Student Loan Bankruptcy in chapter 13 could allow the student loan consolidation of college together with your other bills, hence, gets you an choice to propose your settlement about a span from 3-5 years. Even so, for filling the bankruptcy under chapter 13, you need to have a stable income having a disposable income plus a secured debt no a lot more than $1,010,650.

Furthermore, the scholar loans are incorporated from the payment plan depending on certain factors like size of mortgage, number and quantity of one’s other debts, and also the quantity of the disposable income. Even though the bankruptcy scholar mortgage still remains your liability, even if, not incorporated in the settlement strategy.

Bankruptcy Facts – Collection method in case of defaulted bankruptcy undergraduate mortgage :
Selection costs of 25% and collection agency “commission” costs of approximately 28% onto the principal, interest and penalties are levied.
The federal earnings tax refunds are used until the defaulted scholar loans are paid.
Without having suing in the beginning, Federal Government garnishes as much as 15 percent of your wages
The defaulted student mortgage is paid in the type of grabbing those federal benefits (which you must be entitled like social security requirement) and cutting 750$ per month from your income.,
Sue you for ones outstanding college student mortgage debt and location liens on your own property.

Repayments- Bankruptcy Options
You’ll find numerous bankruptcy services that allow you to obtain discharge of a portion from the bankruptcy undergraduate mortgage. Nonetheless, preparing a repayment plan may well prove a good aid.
You might make the lender to agree to defer repayment right up until your profession and financial circumstances have enhanced.
Consolidating all your scholar loans at reduced rates of interests could also allow you get a settlement time stretched over a lengthy span of period.
If bankruptcy doesn’t take care of your college student loan debts, you may wish to resort to an administrative discharge. While the chances are slim, it’s even now worth a attempt. For example, if you’re disabled for living, then you’ll probably qualify for an administrative discharge that eliminates your undergraduate loan debts. Joining the military or the Peace Corps are also great methods to wipe out your debts.

There are also a bunch of new fees that makes filing for bankruptcy more of a hardship for people already having financial problems. You’ll be required to attend financial counseling both before and after filing for bankruptcy, which you’ll be required to pay for. The bankruptcy law is much more complex, which means that your lawyer fees will be higher.

The previous bankruptcy laws were based on a belief that a person who was responsible, who had worked his or her entire life, regularly paid his bills on time, and generally was a good citizen, could have an opportunity to wipe his financial slate clean and start over in the off chance that through circumstances beyond his control, he was unable to pay his bills. Sure, the system was taken advantage of by some, but in a society of laws, that’s unavoidable.

Now some of the old laws were woefully out of date and were long past due for modification. So changes are good. But making modifications to the law shouldn’t mean that you remove the safety net for people. This is particularly true when the debt position that a lot of of these people found themselves in were surely worsened by the outrageous late fees, percentage hikes, and other “profit centers” built into the lending practices of most of the major credit card companies.

How Facebook affects the law and employment.

There are well over 600 million members on Facebook that share personal details about their lives, but most don’t realize how easy it is for their photos, opinions, and activities to be observed by outside parties. The CIA, attorneys, schools, insurance agents and employers have all been known to use Facebook as a tool to judge your character among other things. Many have been fired (sometimes illegally) or even expelled from school due to content on their Facebook page. Here are some shocking statistics:

The secret to protecting yourself on Facebook: The Attorney Resource Center
The secret to protecting yourself on Facebook:The Attorney Resource Center