What Will Bankruptcy Do to My Credit Card Debt?
Make no mistake about it: even in this economy, credit card companies are still MAKING PROFITS. Is it a wonder?
A Few Pointers on Credit Card Debt
Nearly all credit card debt is unsecured debt, meaning the creditor hasn’t secured it with 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, like a mortgage on a house or a lien on a car.
The credit card industry has become a financial crisis all its own. Even with interest sometimes over 30%, millions of people every day live on credit cards to make ends meet, all with the expectation, and intention, of paying back those small daily “loans.” The problem: that “someday” never seems to arrive, and those “loans” come due. We’re now a cashless “credit-card society,” and the banks behind it earn billions of dollars every year. It’s not a crisis to them!
What Happens to Credit Card Debt in Bankruptcy?
In a Chapter 7 bankruptcy, one of the primary purposes is to discharge certain debts and give an honest debtor a “fresh start.” You have no further liability for discharged debts. The right to a discharge isn’t absolute, and some debts, like certain student loans and taxes, aren’t discharged. A discharge also doesn’t remove a lien on property. But subject to a few exceptions, your credit card debt will be discharged in a Chapter 7.
In a Chapter 13, credit card debt is paid only what your budget allows through the plan, often a small fraction of the balance, and what’s left is discharged when the plan is completed.
Want to know why it’s so easy to get in over your head? Read Why Is It So Damn Hard to Resist Credit Cards. Being sued on an old card? See Missouri’s statute of limitations on credit card debt.
Call Markwell Law, LLC today at 636-486-1093 for a free consultation about your debt options. Don’t let another day go by without having a zealous attorney protecting your future.
Markwell Law, LLC
1600 Heritage Landing, Ste. 202B
St. Peters, MO 63303
Phone: 636-486-1093
Fax: 636-634-3462
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code. The choice of a lawyer should not be based on advertising alone. Use of this website does not create an attorney-client relationship.