Alexandria Legal Blog

Many people who have fallen into debt assume they are helpless against debt collection agencies. They assume these companies have a right to harass them at their leisure. The truth is that you have plenty of options when it comes to prudent debt relief. 

One debt collection firm, ACM, based out of Australia, went to court and had to pay a fine for undue hardship placed over harassing phone calls. A consumer watchdog group took the firm to court due to seeking out unpaid debt in unfair manners from a single mother and a disabled man. You have options when it comes to seeking relief from such phone calls. 

Filing for bankruptcy can be a scary process, even if you know it is necessary. One of the most intimidating aspects of declaring bankruptcy is wondering what it does to your credit score. You may fear your credit will be in shambles for years to come – or even forever.

While going bankrupt does impact your credit score, you can build it back up and even get it higher than before by following some simple steps. Here are a few pointers for rebuilding your credit following bankruptcy.

With Chapter 13 bankruptcy, you can use your regular monthly income to repay some or all of your debt. Doing this over the course of three to five years goes a long way in helping you keep your assets.

Here are some reasons to choose Chapter 13 bankruptcy:

• Avoid foreclosure: If you've received a foreclosure notice, a Chapter 13 bankruptcy can stop the proceedings for the time being. It may even provide the opportunity to catch up on back payments through your repayment plan.
• Less impact on your credit report: A Chapter 13 bankruptcy will remain on your credit report for seven years. While this sounds like a long time, it's three years less than a Chapter 7 bankruptcy.
• Lower monthly payments: Through Chapter 13 bankruptcy, you can reschedule some of your secured debts. By extending them over the life of your repayment plan, you may end up with a lower monthly payment. This makes it much easier to meet your obligations.

Thousands of people file for bankruptcy every year. Many of these stories fly under the radar because news outlets tend to only focus on companies filing for bankruptcy. One recent local example includes a Louisiana company that owns multiple nursing homes that had to file for bankruptcy. 

No one enjoys thinking about the possibility of filing for bankruptcy. However, it is vital to remain grounded in reality. In some circumstances, it may be the only way to get out of debt, but it is not right for everyone. Here are three signs you need to start thinking about bankruptcy.