Credit cards are one of the easiest, but most expensive, ways to borrow. People who don’t pay them off in a timely fashion or only pay the minimum balance often wind up in situations with interest rates that can reach almost 20 percent leading to debt that snowballs quickly, accumulates, and never gets paid off.
According to the American Bankers Association, 43 percent of card holders carry a balance each month, and the Federal Reserve reports that outstanding card debt hit a record $1.023 trillion in November 2017. Rising credit card debt is a leading reason why Americans get into a financial hole and wind up being threatened with foreclosure on their homes.
If you have gotten to the point where your credit card and other debt have become overwhelming, you may want to consider filing for bankruptcy. Bankruptcy, a legal way to have many debts forgiven, can eliminate credit card and other unsecured debt, and may still allow you to keep your home.
The skilled and compassionate Ohio debt relief attorneys at Fesenmyer Cousino Weinzimmer understand that even the most well-intentioned people can find themselves in a financial hole. We offer a free consultation to evaluate your individual financial situation by looking at your debts, your income, and your goals and coming up with a debt-relief plan that’s best for you. Contact us online or call one of our conveniently located office branches to set up your free consultation and learn how we can help.
Bankruptcy in Ohio
You cannot file for bankruptcy on credit card debt alone, as the law requires that all your debts be listed in the bankruptcy documents. However, because bankruptcy can eliminate credit card and other unsecured debts, filing will often put you in a better financial position that allows you to keep your home.
The most common types of consumer bankruptcy are Chapter 7 and Chapter 13. Once bankruptcy is filed, an automatic stay — an order of the bankruptcy court that prevents creditors from trying to collect while the court oversees the bankruptcy case — goes into effect. This automatic stay will stop foreclosure on your home, as well as stopping lawsuits, garnishments, and harassing collection calls. The stay lasts only until the bankruptcy proceedings are complete, but it will give you some breathing room; and if you can eventually continue to make mortgage payments, you will not lose your home.
Chapter 7 or Chapter 13?
Chapter 7 bankruptcy will eliminate many debts, including those for credit cards. While your non-exempt property will be sold by a bankruptcy trustee to pay off your debt, Ohio has exemption laws that can protect certain types of property, including your home, clothing, cars, equipment used for work and household furnishings. If all your property is exempt, you may qualify for a “no asset” bankruptcy. You can keep your home, your car, your pension, and more.
Chapter 13 bankruptcy allows you to consolidate payments to repay some or all of your debt in affordable monthly payments over a three- to five-year period. You do not have to come up with a lump sum to pay your past-due amounts, which are spread over the life of the Chapter 13 payment plan; once you successfully complete the plan, dischargeable debts covered by the plan are eliminated. If you can continue to make mortgage payments, you can keep your home rather than losing it to foreclosure.
While Chapter 7 and Chapter 13 bankruptcy are different, both can allow you to keep your home. Plus, because credit card and other debts are eliminated, making mortgage payments after bankruptcy will be easier.
Be aware that exemption laws do not protect all property, a bankruptcy filing does not discharge all types of debts, and there are different classes of creditors that may be able to seize your property. The attorneys at Fesenmyer Cousino Weinzimmer understand each of these distinctions and can provide the best legal advice to protect your assets.
Contact Us and Get Help
If debt is something you can no longer handle, take the first step toward relief by contacting the seasoned and compassionate Ohio debt-relief attorneys at Fesenmyer Cousino Weinzimmer. We offer a free initial consultation to evaluate your entire financial situation and determine the best fit for your particular circumstances. We will make sure you are aware of all your options to help you keep your home. We will be there for you and walk you through the process every step of the way.
Delaying can only worsen your situation, so contact us online or call one of our conveniently located office branches to set up your free consultation so we can determine what debt relief solutions will work best for you.