Law Office of Ginger C. Cord, PSC. - Bankruptcy
Free Initial Consultation

Local 859-963-2073

Toll Free 800-762-6916

Call Today

Pursue A Bright Financial Future
Freedom From Debt Is On The Horizon

Lexington Bankruptcy Blog

Chapter 7 bankruptcy can help curb credit card debt

U.S. residents struggle with some of the highest per-household debt rates in the world. Unsecured debt like credit card debt can swamp a Kentucky family, leaving the household to struggle under the weight of high interest rates. It may be helpful, in the face of rising credit card use, to consider options for debt relief, from consolidation to Chapter 7 bankruptcy. 

In the last 10 years, the market has seen unprecedented growth. U.S. households now account for some $1 trillion in unsecured credit card debt. Over 171 million people around the country have access to credit -- sometimes more than they can handle. Lenders are offering higher limits on credit cards and lower rates as incentive to use more credit. 

Use all available means to get out of debt

When you get into a serious financial jam, it can be difficult to extricate yourself from a mountain of crushing debt. But before you resign yourself to a life of living paycheck to paycheck and dodging creditors, rethink your relationship with money and credit.

Live within your means

Determining the value of Chapter 7 bankruptcy

In modern American life, debt is an unavoidable reality. Many Kentucky households carry an average of thousands of dollars in different types of debt, most specifically credit card debt that can quickly become challenging if not impossible to surmount. Thankfully, there are a variety of options available to manage that debt, including Chapter 7 bankruptcy. However, it is important for an individual or family considering this kind of debt relief to understand what it entails. 

In general, Chapter 7 bankruptcy (also called "liquidation bankruptcy") involves eliminating unsecured liabilities like credit card debt, medical bills and personal loans. There are several ways this can take place, but in all cases, a bankruptcy trustee is assigned to supervise the bankruptcy process. This kind of bankruptcy is generally used by individuals who have insufficient disposable income -- or an insufficient rate of pay -- to pay down existing debt. A means test is employed to determine eligibility for Chapter 7.

Tech company files for Chapter 7 bankruptcy

What began as a single store closure has resulted in the shutting down of a chain of tech stores across the United States, according to business news. Kentucky residents may be familiar with TechShop, which has brick-and-mortar locations across several states. Sources are reporting the company has filed for Chapter 7 bankruptcy after battling financial troubles for some time. 

According to the report, the closures began with a location in the Midwest. The company's CEO sent out a memo at 9:14 the morning of Nov. 15 announcing that the company would be filing for bankruptcy. The filing became official later that day, with the memo clarifying that all 10 of the company's locations would be closing. TechShop has locations in eight states, including their flagship location on the West Coast, all of which are slated for closure. 

Aerospace company files for Chapter 7 bankruptcy

A small aerospace company that has had reasonable success in the last five years has shuttered its hangars, according to the bankruptcy court local to the business. Kentucky aerospace enthusiasts may be familiar with XCOR, based in a West Coast state, which has declared Chapter 7 bankruptcy. The company's assets and liabilities have not yet been made public. 

According to the report, XCOR was best known for an ambitious project building a suborbital craft called a Lynx spaceplane, which was purported to be able to take off and land horizontally. This would be tested at the company's new home in Midland, California, after a local development agency signed a $10 million deal with the aerospace company. However, trouble was on the horizon for the innovative company. 

There are debt limits in filing for Chapter 13 bankruptcy

Every day, the typical Kentucky resident gets up and goes to work. After a long day of taking care of things on the job, it is time to go home and take care of things there. For many, this scenario plays out day after day with no major obstacles. However, for some, something happens, and the financial picture changes drastically. Rather than being able to pay the bills, financial struggles come into the picture, and filing for Chapter 13 bankruptcy may be the best way to alleviate the struggle.

Chapter 13 bankruptcy was designed to provide relief for those individuals who have a steady income but for some reason struggle to pay the bills. Under Chapter 13, the individual is allowed to restructure debt and establish a repayment plan spread out over a three to five year period. The benefit of this plan is that the individual is able to retain property and other assets that may be lost otherwise. At the end of this time period, remaining debt, depending upon its type, can be discharged.

How to handle credit card debt - Chapter 7 bankruptcy and more

Credit card debt is among the most tenacious types of debt one can accrue, thanks largely to the high interest rates associated with credit payment. Some Kentucky residents may be feeling the weight of this debt since the average American household carries some $16,000 in credit debt alone. Thankfully, there are several ways to help discharge credit card debt, from debt consolidation to Chapter 7 bankruptcy. 

Many experts agree that the best first step in addressing debt is to create and stick to a comprehensive budget. Many people have a tendency to treat credit cards as their own money rather than the loan they represent. Sticking to a consistent budget can help curb spending and allows the card holder to create goals for paying down the debt. There are also several other methods to move money around and handle existing debt. 

Congress strips protections from consumers

Last week, the Senate repealed a rule put in place by the Obama administration that gave consumers additional protection from rapacious credit card issuers and banks. The tie-breaking vote was cast by Vice President Mike Pence. The vote rolled back the rule that consumers could take their grievances to civil court and not be limited to resolving their conflicts in arbitration instead of class-action lawsuits.

Two GOP senators opposed measure

Rebuilding credit score after Chapter 7 bankruptcy

Perhaps one of the most common fears surrounding the decision to file for bankruptcy is that the Kentucky resident will never be able to get credit again. Yet, this fear has limited basis in reality. In fact, within a very short time period after filing for Chapter 7 bankruptcy, most individuals are able to begin rebuilding their credit portfolio.

Once debts have been discharged in bankruptcy, it is time to start rebuilding credit. The first step is to apply for a secured credit card. Ideally, this card should require a deposit ranging from $50 to $200. Additionally, there are offers available that do not require monthly or annual fees.

Chapter 7 bankruptcy often better choice than short-term loan

Financial problems are not just the concern of those seeking employment. All too often, Kentucky residents with full-time employment face moments when it seems impossible to make ends meet. Day in and day out, these individuals spend hours trying to earn enough to pay the bills, but it just never seems to be enough. When this is the case, it may be in the individual's best interest to file for Chapter 7 bankruptcy.

Over the years, various forms of lenders have made loans available to those who are struggling. These borrowers are looking for a way to get past today's crisis and make it to the next payday. Unfortunately, many borrowers discover that these types of loans only lead to more debt and increased financial problems.