Debt Consolidation Credit Counseling In Phoenix

Is your credit situation making you think about filing for bankruptcy? Filing bankruptcy is a "last-resort" option for individuals who are experiencing trouble paying their bills.

Frequently, someone who files for bankruptcy has many bad credit marks on their credit report. They often have been rejected for credit recently, have creditors calling them and have multiple bills which they pay late or not at all.

Often there will be a home or vehicle which has been repossessed, or under the threat of repossession.

If you having problems such as these, then you are searching for relief. Not being able to pay your bills is stressful and humiliating.

If you are thinking about bankruptcy, it is absolutely critical that you discover the permanent repercussions of a bankruptcy.

Bankruptcy laws were designed with you in mind. When you file bankruptcy, most or all of your debts will be resolved.

This resolution is achieved after your assets are divided amongst your creditors. This is possible, through bankruptcy, even if your assets don't pay your debts in full.

This procedure is called liquidation, or Chapter Seven (7) bankruptcy. Chapter 7 bankruptcy is the most common type. A "trustee" takes care of all the administrative and supervisory duties of the proceedings.

Chapter 11, 12, or 13 Bankruptcy provide rehab to your business, and choice of using future earnings to pay lenders. Once you begin the bankruptcy proceedings, creditors can no longer collect on your debts.

Additionally, you will not be able to transfer any assets that are part of the estate. Forget about hiding your savings account or gold coin collection with a trusted friend! Also, transferring ownership of assets prior to filing bankruptcy typically does not work.

Recently, the Supreme Court ruled that retirement savings do not have to be included in your assets that are liquidated.

Bankruptcy and your credit reports - regardless of which bankruptcy you choose, it will typically remain on your credit reports for 7 or 10 years. Filing for bankruptcy frees you from your existing creditors, but not from any future creditors.

If you do go through with a bankruptcy, it will narrow your credit options considerably. Good credit is not impossible to restore, but it will take some time and considerable patience.

Some things to remember:

1. Any negative item can potentially be removed from your credit report.

2. New, current good credit lines will make your score improve.

3. Old, bad credit falling off your report will also boost your score over time.

4. You must monitor your credit reports regularly - and dispute questionable derogatory marks such as charge offs, collection items, and late payments.