How Long Do Creditors Have To Collect Debts?

It might seem like some things never end, especially when those things are not fun or cause you anxiety. One of the most common causes of stress among Americans is debt. Most of us have more debt than we can repay, and it only grows every day. If you have been working with a creditor to come to a result on how to repay a past due debt, you are probably wondering if you will ever pay off the loan and if not, how long the lender will continue to pester you for payments. It seems only fair that at some point, a debt has to die, and the creditor has to write it off and stop collection efforts.

One way a lender will stop trying to collect a debt is if you file for bankruptcy. When a bankruptcy case is filed and a discharge is entered, the debt is no longer due. But what if you haven’t filed bankruptcy or you have taken out new debt after your bankruptcy case was over? What happens to those debts, and how long do creditors have to collect what is due? The answer can be found by looking at the relevant statute of limitations. A statute of limitations is a timeframe under which legal action must be taken, and if it is not then it cannot. A good example is a car accident, where the injured person only has a certain amount of time to file a lawsuit against the negligent driver. If a lawsuit is not filed by the time the statute of limitations expires, the Courts do not allow one to be filed later. The statute of limitations for debt collection varies, depending on the type of contract and type of loan. But be careful, because regardless of the time line, there are some things you may be doing unwittingly that will start the clock running new. These include:

•         Making voluntary payments on a debt when asked to do so by the lender.

•         If you used a credit card outside of the limitations time, that use will trip the statute and the time will start running from the date of last use.

•         Sometimes a promise to pay will start the clock, so be careful about what types of conversations you have with your lenders or a collector.

One of the first things to look at if you have been sued for a past due debt is whether the lawsuit was filed within the statute of limitations. If it has not been, you can ask the Court to dismiss the suit and upon dismissal expect that the lender will no longer bother you. If you are being asked to pay a debt you believe is not legally due, according to the statute of limitations, call our office today for more information. We will look at the facts or your case, and take whatever action is needed to help you.

For more information about statutes of limitation, call us today or reach us online at www.law-ri.com. We offer appointments at multiple locations for your convenience and can schedule a time to visit with you today.

Three Tips To Rebuild Credit After Bankruptcy

One of the most common concerns people who file bankruptcy have is how long their credit will be impacted by the filing. We all have financial needs and if your credit is not good, it is hard to get a loan at a good rate, or to enjoy reasonable auto insurance rates. It might even be difficult to rent a house or apartment if your credit has taken a hit, so the concern over how credit is impacted by filing for bankruptcy is understandable. You will be happy to know that you can rebuild your credit very quickly after filing bankruptcy, and it does not take a lot of effort.

Three tips to rebuilding credit after filing for bankruptcy include:

•         Making payments on time. Bankruptcy will not eliminate all of your monthly obligations, especially for property you want to keep. Many people opt to keep their house and car when they file bankruptcy, and when this is the choice that is made the payments still have to be made. If you make these payments on time, your lenders will report you as an on time payer, and this data only serves to boost your credit score.

•         Taking on small amounts of debt after your case, and paying them off quickly. You would be surprised at how quickly lenders will start sending you offers of credit. If you are confident you can repay a new loan, doing so is a good way to repair your credit after filing a bankruptcy case.

•         Opening a secured credit card account is another way your credit will rebound after bankruptcy. Many banks and other lenders offer these types of cards, and if you pay them when due your credit will benefit.

The key here is to not take on debt you are not able to repay, and to take it slow. The worst thing that could happen is for you to get back into financial trouble right away, and undo all the hard work and effort you put forth in your bankruptcy case. For help getting back on solid financial footing, call us today. We can help you through the bankruptcy process, and give you advice on how to stay on track with your money after the dust settles.

For more information about how to rebuild your credit after bankruptcy, call us today or reach us online at www.law-ri.com. We will help by looking at the facts of your case and giving you options to reach your financial goals.

What's The Difference Between A Charged Off Debt And A Debt Discharged In Bankruptcy?

The purpose of filing bankruptcy is to get a discharge of the debts you are not able to pay. When a debt is discharged in bankruptcy, it is no longer considered due and payable. This is helpful because when you don’t have as many monthly payments to make, you are able to focus your funds on the payments that remain. For many people this means they are now able to pay the house and car payment, and buy groceries for their family because they no longer have to worry about making payments to credit cards and other unsecured debts. Bankruptcy can also result in paying less for your car, which also puts more money back in your pocket.

But there are a lot of questions about how the discharge works, and how a debt discharged in bankruptcy is different from a charged off debt. Here’s how it works:

•         A bankruptcy discharge is a legal notation that the debts contained within your bankruptcy are no longer due.

•         A debt that a lender has charged off is still due, it is just no longer showing on the lender’s books.

Many charged off debts are sold, and if any activity towards collection takes place within the legal timeframe to do so, you may find yourself paying back a debt that you thought was no longer lingering. The reason lenders decide to charge off a debt rather than try to keep it alive long enough to collect is largely for paper purposes, because when a debt is charged off the books it no longer brings down the total bottom line on that lending institution’s balance sheet. And, if your lender can sell the charged off debt and make a little, the balance sheet improves all the more. The key is to make sure that any efforts at collection of charged off debts falls within legally acceptable time lines. In order to make this determination, call our office for help. We will review your case and let you know what choices you have, and what will work best to help get you out of debt.

For more information about bankruptcy and how to manage debt, call us today or reach us online at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations for more convenient one on one office visits.

Three Ways Bankruptcy Is Better Than Credit Counseling

When consumers have more debt than they can service, there are several options for relief. It might be that your lender is willing to work with you to lower your payments, or at least let you put the past due amounts at the end of your note and consider the obligation current as long as you maintain payments. Or, you might be able to refinance your house and use the equity to pay off high interest rate credit cards, which frees up money each month by reducing the total amount you are paying out monthly. You might also be considering credit counseling or bankruptcy, and wonder which option makes the most sent for your situation.

Between these two options, it can be difficult to tell which is best, and there is a lot of information out there on both sides of the equation. Our office works with distressed debtors every day, and in our experience, bankruptcy is the answer. Three ways bankruptcy is better than credit counseling include:

•         A credit counseling agency can work with your lenders, but that does not necessarily 

       mean your lenders have to take an offer that is made. In bankruptcy, the courts dictate what is paid back and what is not, with very little room for objection by a lender.

•         Bankruptcy acts as an immediate stop to any collection lawsuit or wage garnishment, which gives you instant relief. But credit counseling can take time, and during the interim you will still be responsible for payments.

•         Some lenders view the hit to your credit score from credit counseling the same way as a bankruptcy. So, there is no measurable benefit to opting for credit counseling if your credit rating is on the top of your list of concerns.

We have helped people get out from under burdensome debt, and we can help you too! Once you have a plan in place, you will feel instant relief from the stress that goes along with being unable to pay all of your bills and look forward with positivity. If you are struggling to keep your head above water financially, call us today to learn your options. Bankruptcy is a beneficial legal tool that will help you to make a fresh financial start.

For more information about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Can My Car Be Repossessed During My Bankruptcy?

The possibility that your wages will be garnished, your home foreclosed on, or your car repossessed if you are behind on payments is great. The longer you go without making a payment, the more likely your creditors are to take action to collect what is due or to take back the property that secures the loan. But, if you file for the protection of bankruptcy, you get a chance to breathe and figure out your next step.

Filing bankruptcy will put an automatic stop to any collection efforts, and also requires any wage garnishments to immediately stop. If your home is in foreclosure when you file a bankruptcy case, that action has to cease as does any effort at repossession of your vehicle. If your auto lender is trying to take your car away from you while you are in bankruptcy, you must do the following things:

●          Call your attorney right away! Unless the auto lender has relief from the automatic stay, any efforts at repossession are against the law.

●          Provide your bankruptcy case number and date of filing to your auto lender, and to any repossession agent that shows up to try and take your vehicle.

●          Make sure your lender has proof of current insurance, because sometimes a lender thinks they can repossess a vehicle if it is unprotected from hazard.

One of the biggest benefits to filing bankruptcy is that you get a break from collection and repossession efforts. If your lenders fail to abide by the rules, and take action when they are not permitted to do so, you have a cause of action against that lender for violating the automatic stay and possible wrongful repossession. We know what rights you have during bankruptcy, and aggressively pursue all of those rights for you. If you are being called and asked to pay a debt that is included in your bankruptcy, or if you have received notice of a lawsuit that concerns one of your bankrupt accounts, take action! You are entitled to a fresh financial start, and that includes a start that is free from creditor harassment.

For more information about how bankruptcy can stop a repossession, call us today or reach us online at www.law-ri.com. We have multiple locations to serve you and can schedule a time to meet at the office most convenient for you.

How The New President Might Impact The Need To File Bankruptcy

For the past year, and even more so in the past months, the nation’s attention has been set squarely upon whether Hillary Clinton or Donald Trump would become the next President of the United States. That question was answered in the early morning hours of November 9, 2016 and the victor was Trump. This information was welcome to some, but sent many others across the country scrambling. Scrambling to protest the election result and scrambling to figure out what a Trump Presidency would look like. As the results started rolling in on election night, the Dow Jones dropped, but has since made up for lost ground.

But, just because the financial markets did not take a drastic hit, that does not mean we are all worry free when it comes to our money and how proposed policies by the new President might impact your bottom line. Several of President Obama’s initiatives came under fire during the campaign, most notably the Affordable Healthcare Act, but there are others that are worthy of mention. In particular, programs for distressed homeowners (like HAMP) may not be renewed by Trump. If so, the need to file bankruptcy in order to tackle mounting mortgage loan debt could become a very real reality for a lot of people. If you are trying to manage more debt than you can handle, consider how filing for bankruptcy can help:

•         All pending collection actions, including a foreclosure, must stop immediately upon filing a case.

•         If your wages are being garnished, that must stop when you file bankruptcy.

•         Bankruptcy allows you to eliminate or significantly reduce the amount of unsecured debt you have to repay.

•         Depending on the type of case you file, you might get to pay a lower rate of interest for your car as well as paying the vehicle’s value rather than the loan balance.

We understand the concern with what lies ahead, and can help you put a plan in action that will give you a sense of security. Rather than let your finances spiral out of control, call us today for help. We will explain your options and help you make a decision that meets your financial needs, and that will help you reach your financial goals.

For more information about how bankruptcy can help you, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Two Main Purposes Of Bankruptcy

Most laws are put in place to serve a purpose. Criminal laws are designed to protect the public from illegal activity and civil laws are used to sort out disputes between people, that do not involve crimes. The hope is that through the proper application of the laws that apply to your particular circumstances, a fair and equitable result is reached. We all know that sometimes the laws fail to deliver on this point, but the alternative is to live in a world without much order and that is not a viable option. When you have a need, the first thing to do is to look for ways to meet that need. When the need is related to the law, you have to take special care to partner with a knowledgeable attorney for help.

When the issue you are facing has to do with how much, or how little, money you have at your disposal every month the answer might be to file for bankruptcy. The two main purposes of bankruptcy are to:

•         Give you a fresh financial start, so that once free from overwhelming debt you can manage your money in such a way as to be able to pay all your bills on time without the worry of a foreclosure or repossession.

•         Provide repayment to those creditors who hold loans for collateral you wish to keep, without preferring one lender over another. Equal treatment of your lenders is one of the purposes of the bankruptcy laws, but it is a balancing act between doing that and getting you out of debt. In order to strike a balance that seems fair, the bankruptcy laws were revised in 2005 to try and put debtors and creditors on more equal footing.

Even though one part of bankruptcy is meant to repay debt, the driving force behind the law is to help the honest, but unfortunate debtor. Bankruptcy laws were written with that goal in mind, and the result may not be perfect, but there are plenty of opportunities for financial help through the process. If you need help getting out of debt, call us today. We can explain how bankruptcy works, and how it can play an integral role in getting you out of debt.

For more information about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.

Three Signs You Need To File Bankruptcy

In most situations that come up in life there are signs along the way of what is around the corner. For instance, when you get a tickle in the back of your throat there is a good chance you are getting a cold. Or, if you have a baby nearing their first birthday you may have seen signs that they will soon start walking. With money, and money problems, there are also signs that you are putting enough aside for an emergency or that you might run into trouble.

Three signs you are facing more debt than you can manage, and need to file bankruptcy include:

•         Having more total debt, in monthly payment amounts, than you have monthly income. When your expenses exceed your income, you need to take fast action to get a handle on your money. Failing to act can result in repossessions, foreclosures, and collection lawsuits being filed against you. Rather than give this type of power to your creditors, it is better to take things into your own hands and develop a plan to get out of debt.

•         You are taking out loans to pay necessary expenses. If you are not able to make your house or car payment without borrowing from savings, your retirement, or life insurance, bigger money problems await.

•         You are behind on some or all of your payments, and have been getting calls or letters from the lender.

No one wants to wind up down a financial black hole, and the best way to avoid this result is to pay attention to the warning signs. If you are having financial difficulty, don’t wait to find a solution. The faster you take action, the faster you can come up with a plan to get out of debt. Bankruptcy is a very real option for a large part of the population, and it can help you too. The moment you file your creditors are no longer allowed to call you and ask for payment. And, if there are any pending lawsuits against you, those have to be put on hold or stopped all together. This is one of the greatest benefits to filing for the protection of bankruptcy, and there are many more. Call us today to find out how bankruptcy can take the pressure off your family.

If you have more questions about bankruptcy, contact us today at www.law-ri.com. We will help you come up with solutions that work for your family, and have multiple locations where we schedule appointments so you can make a choice that is convenient for you.

How Often Are The Bankruptcy Laws Changed?

It should come as no surprise, especially during an election year, that the laws we have today may not be the same laws we have tomorrow. Amendments, revisions, and even repealing a law on the books happen all the time. Or, at least an effort to make these changes happens. It is much more common for a law to be changed at a state or local level than at the federal level, but federal laws can also be amended. One of the biggest changes in recent years to a federal law was to the Bankruptcy Code.

In 2005 Congress decided to rewrite some of the most important provisions of the Bankruptcy Code, and the changes were not widely received as good changes. Some of the most talked about changes we saw to the bankruptcy laws were:

•         Implementation of the means test, which is a mathematical computation that is performed when a person files a case. The result will dictate whether a Chapter 7 or a Chapter 13 case is required. Most people saw this change as a negative, because the end result was that more people were made to file a Chapter 13 instead of a Chapter 7. The reasons this is not desirable is because a Chapter 7 is a total liquidation of debt, including credit cards, and lasts about 6 months. But a Chapter 13 case lasts us to five years, and during that time the debtor will have to repay at least a part of their credit card and other unsecured debt.

•         If you are only eligible for a Chapter 13 case and want to keep your car, you cannot pay the value of the car vs. what is due if the purchase was recent. Well, not necessarily even recent. A provision was added that required Chapter 13 debtors to pay full price for their cars if bought within about 900 days of filing bankruptcy. This was not previously the law, and the change means not as many people get the benefit of paying their car’s value instead of what is owed. And, we all know that most cars are worth far less than what the loan balance shows.

•         The requirement that you undergo credit counseling as part of your case was also added in 2005.

Even though 2005 was over a decade ago, these changes are still relatively new. In the days after the new law was in place, there was a lot of confusion over some of the new provisions. It is our job to stay on top of these changes, and make sure your case is filed properly. We are always looking at the trends in the law, and going to continuing education courses to make sure our representation of you is exact. If you have questions about bankruptcy, call us today.

If you have more questions about bankruptcy, contact us today at www.law-ri.com. We will help you get prepared for what comes after we file your case, and have multiple locations where we schedule appointments.

Can I Take A Vacation If I File Bankruptcy?

There is nothing more relaxing than taking much needed time off from work, but if you are experiencing financial difficulties this can be hard. Let’s face it, vacations cost money, and when you are low on funds it is not relaxing at all to take a trip and be strapped for cash while out of town. The benefit to filing bankruptcy is that most of your debts are no longer due, and this can really free us some money each month. But the question is, what do you do with your extra funds?

Most people use the money they save from filing bankruptcy to pay other debts. Many times a family that is struggling to make ends meet needs to eliminate some of their debts in order to be able to keep current on their other expenses. When payments on high interest rate credit cards are no longer due, the money you would have paid to those companies can be used to make your house or car payment, or to buy groceries. In some instances, the amount saved is enough to put some aside for a rainy day, and some people even wonder if they can finally do something fun like take a vacation. You are not prohibited from traveling just because you have filed bankruptcy, and as long as your case is on track you should not worry about going out of town. But you should take care to be sure that the following things are in place before you make this decision:

•         All of your financial documents have been provided to the Court.

•         The Trustee has not raised an eyebrow about questionable expenditures.

•         You do not have any Court hearings scheduled for the time you plan to be out of town.

•         If you filed a Chapter 13 case, you are current on your plan payments and will not miss one due to taking a trip.

•         If you have reaffirmed any debt, you are able to maintain those payments even if you go on vacation.

•         You do not use credit cards to finance the trip.

•         You make a budget and stick to it, even while gone.

We understand the stress that is caused by having more debts than you can pay, but taking the step to file bankruptcy is meant to alleviate this stress. If you need a break, that’s fine too, but just be sure that your actions do not cause additional stress. It would be a shame to see all of your hard work in making sure your bankruptcy case goes off without a hitch go down the drain in exchange for a quick weekend getaway. Always keep in mind, the bigger picture is not next week or next month, but it is years down the road and we want you to be secure in your finances for a long time.

For more information about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Can I Do Some Of The Work On My Bankruptcy Case Myself To Save Money

We know that when you are having a hard time paying all of your bills each month, that the temptation to cut back and save money where you can is great. There are a lot of opportunities out there to minimize your expenses, such as clipping coupons, brown bagging your lunch instead of eating out, renting movies rather than going to dinner and a show, and the list goes on endlessly. But one spot you definitely do not want to try and cut back is on professional services. If you get sick with something that can’t be treated with an over the counter medication, go to the doctor. If you are being audited by the IRS, call an accountant. And if you need legal representation, call an attorney with experience in the area where you need assistance.

While many cases are handled pro se every year, the dangers and pitfalls are too great to leave things to chance. The sheer volume of legal statutes, rules, and procedures is such that it is best for a person trained in the law and with the experience of going to Court and negotiating with other lawyers to handle court proceedings. When it comes to filing for bankruptcy, money is already tight, but the issue of getting out of debt is far too significant to try and tackle alone. Rather than try and take on this extra burden yourself, call our office for help. That said, there are plenty of things you can do to help your case move more quickly, such as:

•         Be sure all of your data is complete when you give it to your attorney to prepare your case.

•         Finish your credit counseling courses as soon as possible, so this requirement is not hanging over your head.

•         Direct any calls from lenders to your attorney, so they can receive a quick reply about your case.

We have helped many people get out debt by filing bankruptcy, and can help you too. The approach we take is one that includes your involvement, and we keep you updated every step of the way. You will feel confident that your finances are in good hands, and that your financial future is secure.

If you have more questions about bankruptcy or need help deciding what to do about overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

What Documents Are Needed To Start A Bankruptcy Case?

Nearly everything you do has a prerequisite, or a condition that must be met before proceeding. This is true from very early on in life, when you have to be 5 b a certain date to start kindergarten. And, we see this type of thing over and over as we get older, such as the requirement that you turn 16 before you can get your driver’s license, be 18 before you can vote, and turn 21 in order to purchase alcohol. When the task at hand is administrative, there is often the need to gather documents and data before you can tackle what needs tackling. Just like you wouldn’t go to your CPA to prepare your taxes without your W-2, you have to gather certain things before you can file a bankruptcy.

In order to have a bankruptcy case started, here are the documents you need to gather and give to your attorney:

•         Pay stubs for at least the past six months.

•         Copies of your tax returns for the past 3 to 5 years.

•         Copies of car and boat titles.

•         A copy of the deed or title to your house.

•         A list of all of your creditors, with their addresses and the amount you owe.

•         A list of all of your assets that do not have liens.

•         Proof of identity.

Once you have all of these things organized and in one spot, you are ready to go talk to an attorney about your needs. Your attorney will look over these documents, perform a complex mathematical computation, and let you know what type of case you qualify to file. You will qualify for either a Chapter 7 or a Chapter 13, and depending on your needs you will have to make a decision about whether you will file. Be sure the attorney you speak with explains the difference between these two types of cases, and do not make a decision until you are satisfied that the type of case you qualify to file will help you. It is uncommon for a person to receive no benefit from filing, but it is important to know what you are getting into before you take the leap. If you want to know more about how bankruptcy can help you, call us today.

If you have more questions about bankruptcy, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Why Do I Have To Take Credit Counseling Before I File Bankruptcy?

When most people hear the word “counseling”, they immediately think of stretching out on a therapist’s couch and unloading all of their emotional baggage. This is one type of counseling, but there are other forms that serve other purposes. Marriage counseling is designed to help a troubled couple put their relationship first, and drug or alcohol counseling is meant to help people kick bad habits. When you are in dire financial straits, you might turn to bankruptcy as an answer, but even that comes with a requirement that you participate in counseling.

Before you will be permitted to file a case you have to go through a debtor education course, and provide the bankruptcy Court with certification that you completed the credit counseling course. The reason this is a requirement to your case is:

•         When Congress revised the bankruptcy laws in 2005, one of the major concerns was the volume of cases being filed. It was thought that if there was a more robust system of debtor education, bankruptcy would be used as a tool to help an honest but unfortunate debtor get out of immediate financial distress, while providing the tools needed to avoid the necessity of a repeat filing in the future.

•         The goal of bankruptcy is to provide automatic relief, but it is not to be used over and over as a way to get out of paying debts. When debtors learn what behavioral patterns got them in financial trouble to begin with, the thought is that those same patterns will not be repeated.

•         The courses are designed to help people come up with a budget, so the freedom that comes with spending only what you can afford to spend is realized.

•         The counseling is also designed to help people learn how to establish a savings or emergency fund, so resort to use of credit when unexpected expenses come up is not needed.

If you do not take the course before filing, you are given the chance to take it shortly after your case is filed. Our recommendation is to take the course first, and then file because this sequence of events takes the pressure of having a task to complete off your shoulders.

For help with managing overwhelming debt, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.

Will My Lenders Be Able To Prevent Me From Filing Bankruptcy?

Too often in life there are things that come up that you want to do, but something or someone stands in your way. For instance, you might have plans to go to the beach or on an outdoor picnic, and then it begins to rain. Or, you may have made arrangements for a sitter to come over and watch the kids so you can have a date night, then the flu bug hits your house. The point of these stories is to illustrate the point that we cannot control a lot of things in our lives. But when what you need to do will help you get out of financial trouble, it is more important than ever to make sure nothing prevents you from taking the steps you need to relieve financial pressure.

A lot of people who need to file bankruptcy wonder how it works and wonder if they will even be able to file a case. These concerns can lead to other questions, such as whether a creditor can prevent you from filing your case. While your lenders cannot stop you from filing a petition, they can take other action in your case that you might find less than desirable. Some of these things include:

•      In a Chapter 13 setting your lenders can object to your proposed plan of repayment of their debt. If you are unable to reach an agreement you can live with, the Court might decline to confirm your Chapter 13 Plan. Or, if the agreement throws off the numbers and makes the Chapter 13 Plan payment out of reach, the Trustee might advise the Court that your plan is not feasible. This is not necessarily the end of your case, but some adjustments will need to be made in order to make your plan work.

•      In either a Chapter 7 or a Chapter 13, a lender can object to the discharge of their debt. Simply put this means the lender will ask the Court to enter an order that their particular debt remains due after the bankruptcy case is over. You do have defenses to this type of effort, and many times satisfactory results can be obtained. The key is to not get discouraged and throw in the towel on your case.

We understand how difficult life can be when you don’t make enough money to pay all of your bills. So, things only become more stressful if you have to face adversity at every turn. Let us help by taking on the burden of dealing with your creditors, and coming up with solutions that fit your budget.

For more information about bankruptcy cases and what rights creditors have in your case, call us today or reach us online at www.law-ri.com.