Being saddled with so much debt that minimum payments cannot be made feels like a nightmare. Creditors and collection agencies call daily, and some of them threaten with legal action. It seems like the power and water services are always just hours from being cut off. A bankruptcy law firm in Bowie, MD helps people struggling with this type of situation, which is more common than many realize.
Simple vs. Complex Filings
Depending on the person’s situation, filing for bankruptcy can be relatively simple. Someone who has maxed out two credit cards after losing a job now may risk losing their vehicle to the bank because there is no way to make car payments. This is a relatively straightforward situation involving three creditors.
The circumstances become more complicated when the person also has a mortgage on a home, an outstanding student loan, and debt from a personal installment loan. This person may be behind on child support. Dealing with all the paperwork and filing it correctly can feel unmanageable. Being able to turn to a bankruptcy law firm in Bowie, MD for assistance is a relief.
Chapter 7 vs. Chapter 13
A chapter 7 filing through a bankruptcy law firm in Bowie, MD discharges all of the debt that the person cannot pay through dissolution of assets. By the time people file for chapter 7, however, they usually do not have much in the way of assets. Chapter 13 involves building a repayment arrangement with all the creditors that can last up to five years. This is only feasible if the individual’s income has rebounded enough to manage a budget like that.
Not all debts can be discharged in chapter 7, but they could be managed in other ways. Student loan payments might be deferred for a time, and child support payments could be lowered.
The First Step
The first step usually is a free initial consultation with a firm such as Laura Margulies & Associates. If the person is ready to proceed with filing, a list of all creditors and the amounts owed will be needed. Filing the petition immediately prohibits creditors from continuing to contact this individual. Information on this organization can be seen at Law-margulies.com.
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