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Chapter 7 bankruptcy may be the solution to debt problem

Financial problems will not simply go away on their own. Once the decision that something has to be done has been made, it is time to take action. The first step is to analyze the situation and determine which option is best in the given circumstances. For some Kentucky residents, filing for Chapter 7 bankruptcy is the answer. Chapter 7 bankruptcy generally eliminates the majority of debts; however, it does have some very specific criteria.

For some individuals, credit cards are the primary source of the problem. Generally, credit card debt can be eliminated in Chapter 7 bankruptcy unless there are fraudulent charges on credit card accounts. This can happen in a variety of ways. If the account was opened using false information, it would be considered fraudulent. False information can include stating an inflated income when applying for the account.

The court also looks at the creditor's purchasing history with the credit card. For example, it will look at the length of time between making purchases using the card and then filing for bankruptcy. Purchases in excess of $500 will also be scrutinized. Additionally, the court will look at recent cash withdrawals from the credit card account.

Chapter 7 bankruptcy is often the answer to relieving the stress of excessive debt. However, since it does eliminate the majority of debts, the courts will carefully review financial documents, debts and any assets that the Kentucky resident may own. In order to determine if Chapter 7 bankruptcy is the appropriate solution, it would be wise to discuss the situation with experienced legal counsel.

Source: bankruptcy.findlaw.com, "Is Chapter 7 Bankruptcy the Right Option for You?", Accessed on Nov. 26, 2016

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