Month: January 2019

How much debt does it take to file Bankruptcy?

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Tons of people ask the question each day, “Do I have enough debt to file bankruptcy?”  The long and short of it is that the US Bankruptcy code lists no minimum amount of debt to be able to qualify for bankruptcy. However, in consumer bankruptcy, there is a debt ceiling that prohibits an individual from filing a Chapter 13.

The Minimum Amount of Debt

As we stated previously, there’s no minimum amount of debt you have to have to file for bankruptcy. That being said, the amount of debt you have should be a determining factor in whether or not you decide file a Chapter 7 or Chapter 13 bankruptcy. Should you have creditors who are unwilling to work with you, you find yourself owing more debt than you can pay back during the the next five years, or you are facing lawsuits due to debts in collection the time may be right to file bankruptcy. There is, however, only one way to decide if the time is right and that is to contact a local bankruptcy attorney to analyze your individual situation.

The Maximum Amount of Debt

Some people find themselves faced with insurmountable debts. One thing you should understand is that there is a limit to the amount of debt you have have in order to file a consumer bankruptcy. Owing more than $1,184,200 in secured debt or $394,725 in unsecured debt as of 2018 disqualifies you from being able to file Chapter 13 bankruptcy. If you find yourself in this situation then you may be forced to work on settling your debts or reducing outstanding principal in order to lower your debt load before we can file a Chapter 13. .

Bankruptcy in Georgia

Making the decision to file for bankruptcy protection is one that has long lasting implications and therefore shouldn’t be rushed into. Making contact with a local bankruptcy attorney like Harmon and Gorove can give you a better idea of where you stand financially and will allow you to determine which of your debts can be eliminated during bankruptcy and which ones you will have to pay back.

The Automatic Stay: A Saving Grace in Bankruptcy

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Tens of thousands of Americans struggle with credit card debt, medical expenses, mortgages and other bills each day. Many of those people have been contacted by creditors in increasingly predatory and harassing ways about late and delinquent payments. Many businesses have probably even turned your unpaid and deficient amounts over to a collections agency. Many of these collections agencies contact you at the most inconvenient times or in the most inconvenient places such as your work, or at dinner time after a long day away from your family.  They are often ruthless in hounding you and over time may become more and more aggressive towards you in an attempt to collect from you. The best way to stop all of these harassing collection attempts is to file for a Chapter 7 bankruptcy. Filing a Chapter 7 Bankruptcy will stop all collection attempts while your attorney works out the details of your debts with the trustee, this is called the automatic stay.

The best thing about a Chapter 7 Bankruptcy is the automatic stay.  The automatic stay is issued to your creditors once your bankruptcy case is filed in the courts. When meeting with your attorney it is extremely important to include a complete and total list of who your creditors are, their address and phone number and how much you owe them in your bankruptcy petition. Doing this will ensure that these agencies receive notice to stop attempting to collect on your debt and to leave you alone. Once the automatic stay is in place, collection agencies can’t contact you, they must stop garnishing your wages and can no longer initiate or pursue lawsuits. Many of our clients often feel a deep sense of relief their case is filed and the threatening collector calls stop.

During, before and after the automatic stay bill collectors are also banned from taking certain actions including making threats, calling you at extremely late or very early hours, using profane language, increasing debts beyond the terms of the contract and threatening to have you arrested if you don’t pay their balance. These are protections afforded to you by the Fair Debt Collection Practices Act. If you feel that your right have been violated or you are tired of receiving the harassing phone calls and letters, being served with lawsuits or having your hard earned wages garnished, call one of the experienced attorneys at Harmon and Gorove.  They can help you find the right debt relief options for your situation and customize a plan to help get you out of debt for good. We offer convenient appointments and our consultations are ALWAYS free.

Bankruptcy, Foreclosure and the American Dream

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During times like this more and more Americans have found themselves to be faced with the prospect of foreclosure or bankruptcy. American society puts a high value on owning a home and for many people it is a source of personal wealth and pride. For the many people who have been through the foreclosure process or filed for bankruptcy protection, being able to purchase a new home and start over again seems like it is an unattainable dream.

There is good news though, recent interviews with people in the housing industry (builders, realtors and lenders) suggest that people who have been through the foreclosure process or have filed for bankruptcy protection are often able to return to homeownership sooner than previously thought.  There are steps to take though in order to attain the dream of homeownership again.

Getting back on track

Foreclosures and bankruptcies often stay on someone’s credit for 7 years or more.  Because of this you must take deliberate steps towards rebuilding your credit as soon as you possibly can.  Consistently making bill payments on time, paying down credit cards, lowering other debt, and avoiding going into additional debt can cause credit scores to be dramatically improved within months of being discharged from bankruptcy or completing the foreclosure process.

Many experts say that many people who work diligently at rebuilding their credit and are save money for down payments are able to buy another home within two to 3 years. Federal Housing Agency (FHA) loans are a frequently used way for previously foreclosed upon homeowners to be able to finance a new home purchase. Many former homeowners who have been through a foreclosure or bankruptcy cannot qualify for conventional mortgages and FHA loans have exploded in popularity amongst people with little credit or damaged credit

Generally speaking, conventional mortgages offer interest rates that are lower than FHA mortgages but conventional mortgages often require a downpayment of 20 percent of the price of the home, a credit score of at least 720 and a proof of income. Comparatively, FHA mortgages, only require credit scores of about 620 and a down payment of 3.5 percent of the home’s purchase price, which makes it much more attractive for lower income people or people with little savings.

FHA loans have drawbacks. In addition to higher interest rates, FHA mortgages are subject to a mandatory insurance premium of 1.75 percent of the loan. While this sounds like a lot more money up front, often, these costs can be rolled into the total amount of the loan. Additionally, payments of 1.25 percent of the outstanding balance are required of the homebuyer each year. Many Americans find that FHA loans are a more affordable option despite these drawbacks.

FHA mortgages are not the only available option for homebuyers. Many former homeowners eligible for first-time homebuyer programs and if you qualify for Veterans benefits, you might qualify for a mortgage under the VA. These different programs help buyers to make the down payment and handle the closing costs of the loans. Generally speaking, programs like this are available to homeowners who have not owned a home within the previous three years.

A competent Attorney can help

If filing for bankruptcy is something you’re considering or you find yourself  threatened with a foreclosure it can feel like your world is collapsing around you. We cannot state more emphatically that this is not the case. The experienced bankruptcy attorneys of Harmon and Gorove can explain the bankruptcy and/or foreclosure process and advise you on how it will affect your financial situation. Armed with facts, expert analysis and years of experience our team can recommend the best debt-relief option for your particular situation. With the planning, guidance and the expertise of our team your dream of owning a home again can once more become a reality.

Bankruptcy and Divorce: They often go hand in hand

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Financial problems are often a source of major problems in a marriage. Many couples in Georgia have found themselves facing the prospect of divorce at least in part due to unsustainable debt or different spending habits. Many couples choose to file a Chapter 13 bankruptcy in an effort to save their marriages from divorce.  Unfortunately, this decision doesn’t always end up working out and leaves divorce as the only option. Divorce can leave the parties wondering how their bankruptcy will be impacted.

There are several factors that play into the options for people facing divorce in this situation. Bankrate states, some people may be able to convert their Chapter 13 case to a Chapter 7. Another important thing to consider when looking at your options is whether the case was filed as a joint case or a single case.

There is a different set of circumstances for those who did not begin their bankruptcy proceedings before deciding to get divorced.  Those people will need to look at which type of bankruptcy plan is best for them according to a blog called My Horizon Today. The types of debt, the new incomes of the divorcing parties and the expenses incurred by new living situations are just some of the factors that will contribute to this decision.

Another important thing to think about during this time is how well the divorcing couples are able to work together to achieve their financial goals. If the divorce is not amicable and the former spouses are unable to communicate, a Chapter 13 bankruptcy might not be the best idea. However, for divorced couples who can get along and communicate, this type of plan may be the best thing for them even though they would likely have to communicate and work together through the 3 to 5 year bankruptcy term.

If you find yourself facing debt problems that could potentially lead you to divorce or you are divorcing and find your new financial reality untenable, contact the compassionate attorneys at Harmon and Gorove. We offer same day appointments and free consultation so we can show you how we can help you achieve a new level of financial freedom and get your life back on track.

Living Paycheck to Paycheck? You’re not alone.

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Despite the booming economy and record low unemployment, many Americans are unable to pay their bills and save for a rainy day.  In fact, only 29 percent of families have enough money saved to cover 6 months worth of bills in an emergency fund and a whopping 23 percent have no savings at all. A recent study noted that 78% of American families are living paycheck to paycheck.  It is among the highest number ever recorded.

There are many reasons to explain why this might be the case.  Despite a low unemployment rate, millions of people are underemployed.  Underemployment is when you have a job but are unable to work as much as you would like or work for wages that are too low to support your lifestyle.  Countless others work in the gig economy, driving for rideshare companies or doing contract work that pays intermittently and doesn’t provide benefits or a steady paycheck.  Still more people find themselves saddled with debt that is eating up their paychecks and stopping them from being able to save for the future and get ahead.

The average American household has $137,063 in debt with the average American earning just over $59,000 last year.  While much of this debt is due to a mortgage or student loan, the average American carries a balance of $6,379 on their credit cards.  The total outstanding credit card debt in America now exceeds 1 TRILLION dollars.  Cars are getting more expensive as well. The average American household owes more than $30,000 on car loans.  Suffice to say that millions of Americans are struggling to get ahead and and countless more are actively falling behind, struggling to handle untenable loads of debt.  

If you find yourself among the nearly 8 in 10 Americans living paycheck to paycheck and you feel like you are drowning in debt, you are not alone. The competent and compassionate attorneys at Harmon and Gorove are here to help you get your finances back on track.  We offer free consultations and have helped thousands of people achieve financial freedom. Call us today and let us help you!

Are unpaid medical bills keeping you up at night?

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Medical bills are among the top reasons why people file bankruptcy. The Medical industry is rife with complaints about how charges are calculated and it has little transparency in how much each procedure will cost. Many Americans have no idea how much each visit to the doctor will ultimately cost and even less of an idea about how much a procedure or hospital stay will set them back.  This is especially true of people who do not have medical insurance. The nature of Medical care is that it’s something that often times can’t be put off, especially in emergency situations. With the average cost of an ambulance ride nearing $1,000 and the cost of an air ambulance being $50,000 or more, just getting to a hospital in an emergency situation can bankrupt even the most well off citizens. The choice to seek medical care stresses many Americans, including those with health insurance.

CBS News reports that nearly 25 percent of adults in the U. S. have an unpaid balance on a medical bill. Numerous factors may be involved in why this is the case and who the most indebted people are. Many imagine that the elderly are the group most likely to have unpaid medical bills but it’s actually  people between the ages of 20 and 50 that hold that distinction.

A recent study found that geography plays a role in who often incurs debt for medical care which they can’t afford. The Atlantic states that people who live in The South are more likely to find themselves with medical debt. In fact, of the top 10 states with the highest rates of medical debt, eight are Southern States. Some reasons may include an overall higher need for medical care as many people in the South lead less healthy lifestyles which often requires more medical attention.  Many of the states also did not expand Medicare coverage under the ACA.

Georgia is one of those states in the top 10, coming in squarely at number 10.  37 percent of people in Mississippi have unpaid medical bills while just under 30 percent of Georgians have unpaid medical bills.

Unpaid Medical bills can put a larger strain on the budgets of people who are already finding it hard to make ends meet.  Many doctors and hospitals routinely turn those bills over to unscrupulous and predatory debt collection agencies who constantly harass people, including at work, with threatening phone calls and nasty letters. Some debt collection agencies report negatively on your credit while others go so far as to sue you and garnish your wages.

If you find yourself being harassed, sued or garnished by debt collectors over unaffordable medical bills call the attorneys at Harmon and Gorove and allow us to schedule a free consultation so we can develop a plan to help relieve you of the stress that these unpaid medical bills cause.  We can help you get started on the path to financial freedom today!