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Archive for February, 2020

How to Find and Fix Common Errors on Your Credit Report

If you are having issues with debt and considering a bankruptcy filing, there is something that you can do to ensure that the process goes as smoothly as possible

Having an accurate credit report will be very important when you meet with an attorney and discuss your bankruptcy options. There are times when errors occur on one or all of your credit reports. These errors can lower your credit score and also list creditors that should have been removed. The first step to take is to obtain a free copy of your credit report from each of the 3 major reporting companies (which are Equifax, Experian, and Transunion). Go to www.annualcreditreport.com and request your (free) annual reports. Next, go through your reports very carefully to verify that the information is 100% correct. If it is not, then you can dispute the errors with the credit reporting company AND with the company that is reporting incorrect information.

There are certain credit reporting errors that are seen more often than others

Errors regarding your personal information are common. Make sure that your entire name and current home address and phone number are correct. Look at all your listed accounts to make sure that they all belong to you, not to someone else with a similar name to you. If you have ever been the victim of identity theft, make sure that there are no accounts that were opened due to fraud by this theft.

In regards to each specific account listed on your report, make sure that the balances are current and correct. Also verify that the correct credit limits are listed for credit card accounts. This makes a difference in relation to your credit score.

Account status is the next area to take a look at

There are several items to be aware of here. Make sure each debt is only listed once and that any accounts that have been closed are reported as such. If any of your closed accounts are still reported as open, be sure to dispute this. Also, check to see that if you are an authorized user of an account (and not the account owner), that this is reflected properly on your report. Dispute any error that lists you as the owner of the account if you are not.

Other common account status errors include: accounts incorrectly reported as late or delinquent; incorrect date of last payment; incorrect date opened; incorrect date of first late payment/delinquency (if applicable). One other possible error is an account that appears more than once with different creditors.

If you discover any error on any of your reports, gather any supporting documentation that proves that there is a mistake. Then contact the credit agency or agencies that have misinformation, along with contacting the creditor/bank/company that provided the misinformation. This will ensure that your credit report is fully accurate and go a long way in improving your current and future financial situation.

Tax Season: Bankruptcy and Income Tax Refunds

Tax season is upon us, and many people think about a fresh financial start this time of year

When it comes to filing yearly taxes, it is an opportunity to assess current goals and whether current financial strategies are working efficiently. If you have filed a Chapter 13 case and are having trouble making your current plan payments, you may want to consider a conversion from a Chapter 13 Bankruptcy to a Chapter 7 Bankruptcy.

The main benefit of converting from a Chapter 13 Bankruptcy to a Chapter 7 Bankruptcy is that you will no longer have a monthly trustee payment

You can use your income tax refund to bring any outstanding secured obligations current with the lender (e.g. vehicle, mortgage). You will only have one case filed with the same case number, even if you convert from a Chapter 13 to a Chapter 7. Only one bankruptcy filing will show on your credit, rather than having a dismissed Chapter 13 case and a later filed Chapter 7.

Another major benefit of converting your case from Chapter 13 to Chapter 7 is that you can add any debts incurred after you filed your Chapter 13 case. If you incurred new debt during your Chapter 13 that is making it difficult to make your Chapter 13 payments, then a conversion can help alleviate this problem. Some examples of new debt can include new medical bills, or an unexpected, costly home repair.

In order to convert your case from Chapter 13 to Chapter 7, a notice will need to be filed with the Court

There are certain conditions that need to be met. Your bankruptcy attorney will discuss these with you.

With a Chapter 7, there is no monthly payment plan like there is with a Chapter 13. You will still have the automatic stay in effect during the length of your case. However, the Trustee may sell any non-exempt assets that you have in order to pay your creditors. This is known as liquidation.

Once a Chapter 7 case is finished, you receive a discharge of all debts that were part of your case. This occurs in a much shorter time period than for a Chapter 13 case, since there is no repayment plan. In many instances, converting your case from a Chapter 13 to Chapter 7 may be less costly than filing for a Chapter 13 and then having to file a separate Chapter 7 if your Chapter 13 case was dismissed.

An experienced bankruptcy attorney will assess your case to make sure conversion makes sense for you. There can be major benefits to converting your case from a Chapter 13 to a Chapter 7, but it is critical to understand all the implications.

Wage Garnishments and Bankruptcy

If you are considering filing either a Chapter 7 or Chapter 13 Bankruptcy, it is important to understand what happens to any current wage garnishment that you may have. A wage garnishment is a court order that enables a creditor to take money out of your paycheck. Once a wage garnishment starts, it is difficult to stop. Bankruptcy is an effective method to stop a wage garnishment. For most types of debts, either a Chapter 7 or a Chapter 13 filing will immediately stop a wage garnishment. Many people consider filing bankruptcy solely because of a wage garnishment.

There are many different types of wage garnishments

Some of the most common types include: child support, alimony, income tax debt, student loan debt (federal and private) and judgment creditors (such as banks and credit card companies). Each type of wage garnishment has different rules that apply, and these rules are affected differently by a bankruptcy filing. Most of these rules are specific to your state of residency.
Each type of wage garnishment has different rules that apply, and these rules are affected differently by a bankruptcy filing. Most of these rules are specific to your state of residency.

A bankruptcy filing, whether a Chapter 7 or Chapter 13, puts an immediate stop to most wage garnishments

This is called the “automatic stay.” This stays in place for the duration of your bankruptcy case (or until further order of the bankruptcy court), which can last up to 5 years, depending on the type of bankruptcy that you file. A Chapter 7 will generally eliminate the debt completely.

A Chapter 13 may require you to pay the debt back, or a portion thereof, pursuant to a Chapter 13 plan. No matter the chapter of bankruptcy, once you receive a discharge, you will no longer have any of your wages garnished for that particular discharged debt.

Another thing to realize is that if you are unable to pay current debts and obligations, filing for bankruptcy may prevent a wage garnishment from ever starting in the first place. Meeting with a qualified Atlanta area bankruptcy and wage garnishment attorney can help you assess your situation to see if this would be a good idea for you. An attorney can help to determine the options that best suit your needs, and help guide you through the process for the best possible outcome.