Are you worried about your debt problems? Does the thought of not being able to pay your bills keep you up at night? If so, you are not alone. Millions of people are struggling with debts that they cannot afford to pay. They are searching for an affordable way out of debt. At Allegiant Law, our Anthem debt problems attorneys can help.
Filing Bankruptcy in Anthem to Get Out of Debt
One option to get out of debt is to file for bankruptcy relief. Many individuals who meet the income requirements for filing under Chapter 7 receive their bankruptcy discharge within four to six months after filing their bankruptcy petition.
A Chapter 7 bankruptcy case can get rid of many unsecured debts, such as credit card bills, personal loans, medical debts, and judgments. In some cases, a person may be able to get rid of old tax debts and some student loans through a Chapter 7 bankruptcy case.
If you earn too much money to file Chapter 7, you may qualify for bankruptcy under Chapter 13.
In a Chapter 13 case, you reorganize your debts with the help of the bankruptcy court. Your bankruptcy repayment plan is calculated based on a variety of factors, including your income and expenses. Equity in property and recent financial transactions can sometimes be factors in the amount of a Chapter 13 plan payment.
Most Chapter 13 debtors do not pay back all of their unsecured debts. They only pay a portion of the unsecured debt through the Chapter 13 plan. When they complete the plan, the remaining unsecured debts are discharged. Some debts are not eligible for a discharge. However, except for student loans, most debtors include non-dischargeable debts in their Chapter 13 plans so they can get rid of these debts too.
Are There Alternatives to Filing Bankruptcy?
Yes, there are some alternatives you can use to get out of debt instead of filing for bankruptcy relief.
Budgeting and Managing Debt
Depending on your financial situation, you may be able to increase your income (get a second job) and/or reduce your expenses so that you have additional money each month to pay down debt. By living within a budget, you might be able to get out of debt without filing bankruptcy.
Debt Consolidation Loans
Some people borrow money to pay off their debts. Instead of having multiple debt payments, they have one monthly payment. However, most debt consolidation loans require collateral. If you cannot afford the payments on the loan, you could lose your home or other property. If you work with a debt consolidation company, you may be charged a fee for the service, which could be expensive.
Using Retirement Funds
You could use your savings or retirement funds to pay off debts. However, retirement funds are typically protected from creditors in a bankruptcy filing. Instead of using retirement funds that you will need in the future, you could file bankruptcy, discharge your debts, and keep your retirement funds.
Negotiating with your creditors to settle debts could be an option, if you have access to enough money to pay lump-sum payments to your creditors. Two things that you should keep in mind about debt settlement:
- (1) Not all creditors are willing to accept reduced payments, so you may still have debts you cannot pay; and,
- (2) Debt that is forgiven becomes taxable income, which could result in a tax liability.
Contact Our Anthem Debt Problems Attorneys
Are you ready to explore your options for getting out of debt? The legal team of Allegiant Law Group is here to help. Call our office at 602-562-1000 to request your free consultation with an Anthem debt problems lawyer.