Get Some Philadelphia Debt Answers

Q. What is the difference between Chapter 7 bankruptcy and Chapter 13 bankruptcy?

A. Chapter 7 is sometimes called a fresh start bankruptcy. In Chapter 7, the Trustee can liquidate your non-exempt property to distribute to creditors. However since those who are eligible for Chapter 7 usually have little in the way of non-exempt property, they usually keep most of their assets and their debts are discharged. In other words, debts such as credit card bills, medical bills and certain other bills are eliminated; hence, you have a fresh start.

Chapter 13 is for those who either do not qualify for Chapter 7 bankruptcy or wish to repay their debts, but just need a longer period of time to do so. It generally allows you to prevent foreclosure and keep your assets. At the end of the three- to five-year repayment period, remaining debts are discharged.

Q. Can I file for bankruptcy without the help of a lawyer?

A. You are not required to use an attorney to file for bankruptcy. However, bankruptcy laws are complex and require extensive documentation filed according to strict deadlines, along with knowledge of the laws and the available exemptions. It may be in your best interest to work with a qualified, experienced bankruptcy attorney to ensure the best outcome.

Q. Is it possible to negotiate directly with my creditors?

A. Yes. In fact, it is often the best first step you can take. Rather than avoiding their calls and letters, it is always a good idea to try to meet the problem head on. Most creditors would rather negotiate directly with you than have you file for bankruptcy. How far you will get depends on how cooperative the creditor is, your payment history…and your own powers of persuasion.

Q. Can a “debt consolidation” or “credit repair” really help me with my debt problems?

A. A debt counselor or counseling agency is certified and will help you look at your financial picture, offer you ideas on how to manage your money and your debt, and provide assistance in developing a budget. With debt consolidation, you are taking out a new loan to cover your old loans, while so-called “credit repair” companies do little more than try to negotiate with your creditors — something you can do on your own, and for free.

Q. How do I find a lawyer who can help me with my debt problems?

A. There are a number of attorneys in the Philadelphia area whose practices are focused on bankruptcy and debt relief or who have extensive experience helping people get out of debt. Fill out the form and a qualified attorney will contact you.