Creditors and Debt Management
A San Jose bankruptcy lawyer speaks to Creditors and Debt Management
Debt management is an important topic for individuals thinking about bankruptcy. Often what attracts people to bankruptcy is, upon successful discharge, the face no further obligation is owed to creditors. While bankruptcy does not discharge all debts owed, most unsecured debt (credit cards) can be eliminated or repaid at a severely discounted rate.
In 2005 Congress made several revisions to the bankruptcy code. Among those changes included a requirement that an individual take a debt management or credit counseling course prior to filing a bankruptcy petition. The idea was to impress upon the individual the importance of appropriate debt management and help them understand their finances and develop a realistic budget.
In addition, the debtor, prior to receiving a bankruptcy discharge, is required to take a pre-discharge debt management course. The purpose of this course is to help prepare the debtor for life after bankruptcy and help them better manage their finances. The goal is to help the debtor with debt management and try to make them aware of what habits led them to bankruptcy and to hopefully avoid falling back into old habits.
An understanding of debt management is also important when dealing with creditors after bankruptcy. While it may be difficult to obtain credit soon after a bankruptcy discharge, it is still possible to obtain loans and credit cards within a few years after filing for bankruptcy. Individuals should approach debt management seriously in order to not fall into the same pattern of behavior that led to bankruptcy in the first place. While it might be enticing to say yes to higher credit limits when presented with the option from creditors, the more prudent approach would be to assume only what is necessary for living and to forgo certain luxuries until it makes financial sense.
If you have a question regarding Bankruptcy in San Jose please contact us at 408.279.2288 or visit www.bkanswers.com and we can connect you with one of our experienced San Jose Bankruptcy Attorneys. After you have spoken with one of our San Jose bankruptcy attorneys we can schedule you a free face to face appointment in our office location nearest you. Our team of San Jose Bankruptcy Lawyers can assist you with all aspects of your case. If you have questions about filing a chapter 7 bankruptcy, a chapter 11 bankruptcy, a chapter 13 bankruptcy, lien stripping, cram down, stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your financial needs. Please feel free to complete our free bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.
