A South Carolina Bankruptcy Attorney Explains How
It's common for people who overspent on their credit cards to think about filing for bankruptcy to get out from under that crippling debt—and they may be right.
The goal of bankruptcy is to wipe out personal liability for debt. If you file for bankruptcy, unsecured debts like credit cards can be discharged. In other words, if you’re struggling with credit card debt, filing for bankruptcy is like hitting a reset button.
However, not everybody qualifies for bankruptcy. There are certain standards that have to be met and strict amounts of debt that can't be exceeded.
Falling Behind on Credit Card Payments
Credit card debt is easy to fall into. If you skip making a monthly payment on your credit card, you’ll be hit with a late fee. If you miss the month after, credit card companies can raise the interest rate.
The Credit Card Accountability Responsibility and Disclosure Act became law in 2009. The CARD Act brought sweeping reforms to the credit card industry, but consumers still need to pay attention because:
- There is no maximum interest rate (The national avg. is 16.13%, but in 2010, a company offered a credit card with a 79.9% interest rate.)
- Card issuers can still raise your interest rate if:
- The prime interest rate, or APR, goes up
- You have had the card for over a year
- Your credit score goes down
- The promotional rate period ends (though all promotional rate periods must last for at least six months)
- Deferred interest still exists (Like “no interest paid if you pay your balance in full by 2022.”)
- There is no protection for small business credit cards
When your credit card's interest rate shoots up, your credit card debt can skyrocket and become too much to manage. If you can’t make minimum payments, aggressive debt collection agencies are often called in.
But you can stop the collection agencies and protect your home, your car, and other possessions. There is a way out by filing bankruptcy—and our law firm can help you.
Talk to an Attorney About Filing Bankruptcy
If you file bankruptcy, your credit report will take a hit for years and make it harder for you to get a loan right away. However, millions of Americans choose Chapter 7 or Chapter 13 bankruptcy as the best solution for reorganizing or eliminating their debt every year.
Declaring bankruptcy could be the right answer for you too.
There is an old adage that goes: “If you are your own lawyer you have a fool for a client.” In other words, it is probably not a good idea to represent yourself in any legal matter without a lawyer.
An experienced attorney can make sure the paperwork is filed accurately and on time, and bring years of knowledge of bankruptcy law to your case when representing you.
Filing for bankruptcy can be a difficult decision, but choosing the right lawyer to work with should be simple.