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Confronting credit card debt with Chapter 7 bankruptcy

Most Americans carry at least some credit card debt, with the average consumer having a balance of about $5,000. Many of these individuals pay little more than the minimum balance each month, resulting in a growing balance, accumulating interest and little hope of ever paying off the balance in full. Credit card debt can be overwhelming, but Chapter 7 bankruptcy can offer a way out.

How much credit card debt a person can effectively handle differs on a case-by-case basis, and even one small change in circumstances may result in an inability to make regular payments. Those who are unable to pay down any principal may quickly fall behind, but there are options for Kentucky consumers who are dealing with significant credit card and other types of unsecured debt. In these situations, bankruptcy may offer a positive solution.

Chapter 7 bankruptcy, also known as a liquidation bankruptcy, provides certain protections to applicants, allowing them to discharge or eliminate certain types of debt. While in bankruptcy, the person will be shielded from harassment from credit card companies and other types of debt collectors. The Chapter 7 bankruptcy process will be complete in a matter of a few months.

Not every individual struggling with credit card dent will be eligible for Chapter 7 bankruptcy. Eligibility is based on a number of different factors, including the types of debt owed and income. For those in Kentucky who want to know if bankruptcy is an option due to their credit card debt, a complete case evaluation with an experienced attorney makes good sense.

Source: USA Today, "Here's the average American's credit card debt -- and how to get yours under control", Matthew Frankel, Jan. 24, 2017

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