Credit Card Debt Elimination Through Personal Bankruptcy
When filing a Chapter 7 bankruptcy case, you will files several bankruptcy forms with the bankruptcy court disclosing your personal and real property, your income and expenses, debts and property transactions. The bankruptcy court will appoint a person called the “Trustee”, who is assigned to oversee your case. About 30 days after your bankruptcy case is filed, you will attend the “Meeting of Creditors” where the trustee reviews your personal bankruptcy case, verifies your identity, and may have a few basic questions. Despite the name, editors rarely attend. The meeting lasts only a few minutes. A couple months later, he should receive a notice from the court that all debts that qualified for discharge were discharged.
Under the federal Bankruptcy Law, a discharge releases you, the debtor, from personal liability for certain specified types of debts. In other words, you are no longer required to pay any debts that are discharged. The discharge operates as a permanent order directing your creditors to refrain from taking any form of collection action on discharge debts, including legal action and communications with you such as telephone calls, letters and personal contacts. Although a debtor is relieved of personal liability for all debts that were discharged, a valid lien that has not been removed by the bankruptcy case, will remain after the bankruptcy case is final. Therefore, a secured creditor may enforce the lien to recover the property secured by the lien. In other words, if your car is still under financing, the lender can repossess the vehicle, but in most cases if you work something out with them by reaffirming the debt, they will not. One thing for sure with bankruptcy, you will have complete unsecured credit card debt elimination and a chance to start over.
