Bad Credit? Start Rebuilding

July 14, 2014

Bad Credit? Lose The Shame, Take Responsibility, and Begin Rebuilding

According to the research firm Sherbrooke and Associates, 43 percent of American households are “credit constrained.” This is probably because they carry too much current debt, or they were forced into making poor choices with their credit in the past. With interest rates rising and the housing market cooling, the number of credit constrained households is likely to increase. If you find yourself in a such a situation, know that you’re not alone.

Having excess debt and bad credit is a source of shame for many, and it has even been known to break up otherwise loving marriages. Many people who are credit-constrained feel there is no way out – particularly now that bankruptcy laws have been changed to make filing for bankruptcy more difficult for people with even average incomes. The truth, contrary to what most bankruptcy lawyers will tell you, is that bankruptcy is rarely the answer. You can dig yourself out of debt and repair your credit – all that it takes is commitment, discipline, and most of all, a new attitude.

Step #1 – Let Go Of Your Shame

Unless you fraudulently charged items that you had no intention of paying for, you need to let go of all shame related to your bad credit and debt. After all, the credit system is set up with the understanding that some people will be unable to pay their debts – that’s why lenders are paid interest, to compensate them for risk. If you buy a corporate bond and the company goes under, nobody feels sorry for you, so don’t let your creditors make you feel sorry for them. Just like buying a bond, your creditors took a financial risk by lending to you, and they didn’t do it out of the kindness of their hearts – they did it to make money. So long as you had every reason to believe that you’d be able to pay for your debts, you have nothing to feel guilty about.

Letting go of your guilt and shame is not the same as abdicating all responsibility. To one degree or another, you are responsible for your situation. To another degree, externalities – things in the outside world – are responsible. Take responsibility for your actions, but do not let anyone make you feel guilty or they will wield that guilt as a weapon against you.

Step #2 – Contact Your Creditors

Once you’ve let go of your shame and have committed to taking responsibility, it will be much easier to face your creditors. Explain to them that you’re over your head in debt, and while you want to honor your commitments, you would appreciate it if they would work with you to make doing so easier. Most of the time, your creditors will be more receptive than you would imagine – after all, they’re used to people in your position ducking under a rock and ultimately sticking them with the bill.

Your creditors may offer to let you skip a payment or two in order to help you get back on your feet, or they might offer to lower your interest rates. If you still have your accounts open, they might offer to suspend your credit while you pay off the balance in principal only at regular monthly intervals. Finally, they may offer to settle your accounts at less than the full amount due if you pay in one lump sum.

Step #3 – Begin Rebuilding Your Credit

While restructuring your payment terms, by all means, stop abusing credit. You need to work out a budget that will prevent you from finding yourself in this situation again. If you still have credit cards that haven’t been canceled, you should continue to use them – but make absolutely sure that you can pay for everything you’ve charged that month when the bill comes due. By doing this, you’ll keep a credit account active, which is good for your credit.

Many of these negotiated payment plans will adversely affect your credit – particularly settling for less than the total amount due, which will be a black mark on your credit report for up to seven years. The fact is that negotiated settlements may still may be superior to falling deeper and deeper into debt, which could ultimately destroy your credit and lead to legal action being taken against you.

Once you’re back on your feet, be sure not to repeat the same mistakes you made in the past, but don’t swear off credit altogether, either. Just because you’re in bad shape now doesn’t mean that you always have to be. Open up a small credit account and pay your bills in full and on time, and in a matter of just a few short years, your credit can be just as good as anyone else’s. The sooner you start rebuilding after a near credit meltdown, the sooner you’ll be able to experience the security and peace of mind that the other 57 percent of Americans enjoy.

Finding Good Bankruptcy Lawyers

July 4, 2014

Going through bankruptcy is a process that no one ever wants to go through. However, it is something that could happen to almost anyone, so it is a good idea to prepare yourself with valuable information about bankruptcy in the event that it ever happens to you.

Start at the Beginning

At the beginning of this painful process, you will run through a gamut of emotions including confusion over the steps that lie ahead. Bankruptcy basically means that you have no means of paying off your bills. The good news is that there are steps that you can follow to make it through an experience like this, but you are going to need to have some good bankruptcy lawyers who can guide you through the process in the best way to preserve your financial life and your credit as much as possible.

How to Find a Lawyer for You

The best way to go about finding a good bankruptcy lawyer is to make sure that you are dealing with a firm that specializes in bankruptcy. There are many categories of the law that lawyers can specialize in, and you will want to make sure that your bankruptcy lawyers have had ample experience in this field so that they are equipped to offer you the greatest amount of help possible. It is important that you find bankruptcy lawyers who you can trust, so do your research before settling on a firm. Look for one that is welcoming and forthcoming with information, and that has a good payment plan that you will be able to work with.

Good bankruptcy lawyers are going to be able to counsel you thoroughly in the matters of your money and property. These bankruptcy lawyers should help you to preserve as many of your assets and protect your financial health as much as possible. Bankruptcy is a life-changing event in a person’s life, but it doesn’t have to be the end of your financial future. A good bankruptcy lawyer will keep this in mind as he is guiding you through the steps of your bankruptcy.

You also want to keep in mind that you need to find bankruptcy lawyers that are going to fight for you and your interests in every way possible. The bankruptcy process means that there is going to be a lot of paperwork that you will need to complete and file. When you are facing this mountain of paperwork, it will help to know that you have bankruptcy lawyers in your court to assist you with this task, and ensure that it is done correctly.

Bankruptcy Lawyer: When to Hire One

July 4, 2014

If you are having difficulties with finances and are considering debt consolidation or bankruptcy, you may also be considering hiring a bankruptcy lawyer. Of course for those who are in a financial rut or on the verge of financial ruin, coming up with extra funds to pay a bankruptcy lawyer can be downright impossible. Despite the shortage of money, it is often best to still consider at least consulting with a bankruptcy lawyer before you begin the process.

The main purpose of a bankruptcy lawyer is to help an individual or business go through the legal procedures for filing bankruptcy. Lawyers are meant to help deal with creditors, meet with the court systems to set up payment plans or repayment programs, gather together and liquidate assets, and fill out and file necessary paperwork. Just as a realtor would be the knowledgeable party in the selling or buying of a home, a bankruptcy lawyer will be that knowledgeable source during a bankruptcy proceeding.

In most state and county legal systems, you are not required to have a bankruptcy lawyer for the legal proceedings. This does not always mean it is wise to do without a bankruptcy lawyer, though, as most specialize in just financial law. Unless the court case would be easily cut and dry or you already know a great deal about the legal system in this case, a bankruptcy lawyer can help from becoming overwhelmed with the legalities of the system.

From the start, a good bankruptcy lawyer should help you to determine which chapter of bankruptcy to file and will offer sound reasons why. If you don’t know anything about the different chapters, this is an excellent reason to begin consulting a lawyer. Many lawyers will even offer a free consultation where you can simply claim the advice and move on to take care of the remainder of the case yourself. Often, though, lawyers will charge by visit or by activity, such as appearing at the courthouse or filing paperwork.

Keep in mind that not all bankruptcy lawyers specialize in the same type of cases, so it is important to find a lawyer who can help you with the type of financial difficulties you are having. Some bankruptcy lawyers work specifically with businesses, while others work solely with individuals. Having a good experience with your lawyer will undoubtedly include finding someone knowledgeable in the areas you need expertise.

Another excellent reason to consider hiring a bankruptcy lawyer is simply to have someone knowledgeable who can help guide you through the paperwork process. In bankruptcy cases the paperwork is the most overwhelming aspect and more often than not, bankruptcy lawyers will actually fill out and file all of the paperwork for you. This takes away the burden of dealing with paperwork in the middle of a financially and emotionally straining time.

If you decide that hiring a bankruptcy lawyer is right for you, ask the local court house for names of lawyers in the area. You may also want to consider asking trusted friends or family advice for finding bankruptcy lawyers. If all else fails, take advantage of technology and research cases in your area to see which bankruptcy lawyers most often represent individuals or businesses. This is a great way to determine who the best lawyers are for your financial needs.

Can I File for Bankruptcy Myself?

September 4, 2012

It’s bankruptcy that we’re talking about and so, money is in short supply. Because of this, when many people first start considering bankruptcy as a viable option for themselves, they often consider if they can file themselves, rather than hire a bankruptcy lawyer. This might seem like a great way to save even more money and it’s entirely possible to file yourself, there are plenty of good reasons why you shouldn’t.

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Alternatives to Bankruptcy

September 4, 2012

The first thing you should do before filing for bankruptcy is contact all the people you owe money to and see if there is a way that you can work out a repayment schedule. You might be surprised how cooperative creditors might be if you call and show interest in paying back the debt.

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What is Bankruptcy Protection?

September 4, 2012

Bankruptcy protection is a legal declaration by an individual or a company that declares they are unable to repay their debts. This is more than just simply filing a form and being forgiven of all debts though.

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