Credit Card Debt
What Will Bankruptcy Do To My Credit Card Debt?
Make no Mistake About it, Even in this Economy, Companies are Still MAKING PROFITS from credit card debt!
Is it a Wonder?
An Introduction. Nearly all credit card debt is unsecured debt, meaning that it is a debt that a creditor has not secured by collateral. The creditor is called an unsecured creditor, as opposed to a secured creditor which holds a lien on property (collateral) to secure payment of a debt. Secured creditors have a lien or right to foreclose on collateral for payment of a secured debt.
The credit cards industry has become a financial crisis all of its own. Even though interest sometimes of over 30% accrues, millions of people everyday are living on credit cards to make ends meet, all with the expectation, and intention, to payback those small daily “loans”. The problem: that “someday” never seems to arrive, and those “loans” are due. Unfortunately, we are in a “credit card society” where billions of dollars every year are being earned from the credit companies “banks” supporting this crisis. It is not a crisis to them! In fact, according to the Federal Reserve, the size of the total consumer debt in the U.S grew nearly five times in size from 1980 ($355 billion) to 2001 ($1.7 trillion). Consumer debt in 2019 stood at $747,000,000,000.00. (That’s a lot of “0”‘s!)
The average household in 2019 carried nearly $16,061 in credit card debt.
So what happens to your credit card debt when you file for bankruptcy protection? In a Chapter 7 Bankruptcy, one of the primary purposes of bankruptcy is to discharge certain debts to give an honest individual debtor a “fresh start.” The debtor has no liability for discharged debts. Although an individual chapter 7 case usually results in a discharge of debts, the right to a discharge is not absolute, and some types of debts are not discharged, such as certain student loans and taxes. Moreover, a bankruptcy discharge does not extinguish a lien on property. Subject to certain exceptions, your credit card debt will be discharged through a Chapter 7 bankruptcy however. Talk to a bankruptcy attorney today for more information.
Call Markwell Law, LLC today for a free consultation about your debt options.
Don’t let another day go by without having a zealous attorney protecting your future.
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