College Park, Maryland, residents incur debt or make huge purchases with their credit cards for various reasons, such as a medical emergency, a personal problem or unexpected home or car repair. Many people try to repay debt by cutting expenses, working double shifts and sacrificing vacations. But due to difficult economic conditions, pay cuts or other financial liabilities, these hard working Americans may be unable to make timely payments.
In desperation, many approach professionals who may not provide correct advice and hence may add to the very financial problems they sought to address. A company from California was recently charged with fraud by the Federal Trade Commission after the company promised clients a debt reduction of 30 to 70 percent and to be free of debt in 18 months. This company also advised debtors to stop all communication with creditors.
Various options are available for debtors to repay their financial burdens but they may not be quick fixes. Debt can be retired through loan modification or negotiations with credit card companies, without affecting their personal lives. Sometimes, a creditor may not agree with a debt negotiation request and may decide to recover the debt in full. An unsatisfied creditor may take action by requesting liquidation of assets that were used to secure the loan, including a house and a car. To stop foreclosure or repossession, the person may file for Chapter 13 bankruptcy.
Chapter 13 bankruptcy enables reorganization of debt by presenting a payment plan for creditors to a federal bankruptcy court. An approved Chapter 13 filing may also help a debtor retain the house, cars and other assets while repaying money owed to unsecured credit companies, auto loans, bank mortgages and the Internal Revenue Service. Contact a College Park Maryland Chapter 13 lawyer to see if this type of filing is right for you.
Source: Philly.com, “Is this a fate worse than debt?,” July 18, 2014