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Chattanooga Bankruptcy Law Blog

Making minimum payments won't solve credit card debt problems

When a Tennessee resident receives a statement from their credit card company, that statement will outline what purchases the individual has made with their card in the prior month, what costs have carried over from prior months of purchasing and what minimum payment the individual needs to make to avoid penalties on the account. While some people choose to pay off their credit card bills each month in full, others are not able to do so and just pay the minimums to keep their accounts open and available for additional spending.

However, if a person wants to conquer their credit card debt, just paying the minimums will not get them to their goal in a timely manner. Americans have, on average, around $8,000 in debt on credit cards. If they only make their minimum payments, it could take them over 20 years to clear out those debts. A person's interest rate, the amount of debt they carry and other factors can influence just how long it takes a person to pay off their credit card debts.

Loan consolidation as an option for managing debts

Individuals who have felt the heavy burden of insurmountable debts may have scrambled to find fast solutions to getting out from under the weight of unpaid bills. Despite their efforts, most will likely come to the conclusion that there are no fast fixes when it comes to getting out of a financial hole. While it is imperative that our readers get the right information about their specific options and needs, some Tennessee residents may find debt relief through the practice of loan consolidation.

There are different ways of consolidating loans and debts, such as those that individuals have on their homes, cars and credit cards. They may transfer all of their debts into a single loan so that they are making one payment per month instead of many and they may be able to negotiate a reasonable payment on their consolidated loan so that they do not risk a future default.

Lenders accused of taking debtors' funds after bankruptcy filings

One of the biggest protections that Tennessee residents can receive after filing for personal bankruptcy is a stay on actions of collection on their loans. During bankruptcy, a person is generally given time to either liquidate their assets through a Chapter 7 action or create a repayment plan through a Chapter 13 action. The idea is to give a debtor an opportunity to put themselves in the best possible position to alleviate their burdensome financial troubles and to emerge at the end of the process without debts.

Some debtors find, however, that some creditors do not respect their bankruptcy filings and still take actions against them while they are under the protection of the bankruptcy courts. Debtors have reported that payday lenders and other loan businesses have withdrawn money from their personal accounts to repay their debts after the debtors have submitted their bankruptcy paperwork. These actions may run afoul of bankruptcy laws and these entities may also violate usury laws by imposing massive interest rates on the people who use their services.

Know your personal bankruptcy options for the New Year

Sometimes the one person that a Tennessee resident may struggle to be honest with is themselves. When it comes to approaching life in a truthful, honest manner, it can be tough for individuals to hold themselves to the high standards they expect out of their friends, family members and co-workers.

However, there is one area of a personal attention that individuals should always be truthful about with themselves, and that area is money. When a person has money, life can be very good. However, when they do not have enough money to support their needs, life can be incredibly tough.

What qualifies a debtor for Chapter 13 bankruptcy?

Readers of this Chattanooga bankruptcy and debt relief legal blog may not know that not everyone is able to pursue all forms of bankruptcy. This is because different forms of bankruptcy serve different purposes and therefore only certain individuals and entities may qualify for each. The remainder of this post will discuss how an individual may qualify for Chapter 13 bankruptcy and what events may bar them from using it to achieve financial stability.

Unlike Chapter 7 bankruptcy which addresses the needs of individuals with minimal incomes, Chapter 13 bankruptcy may be utilized by individuals who make enough money to pay off at least some of their debts. In Chapter 13 bankruptcy, debtors are asked to create repayment plans that, over time, pay down the money that is owed to the debtors' creditors. If a debtor does not make enough money they may not be able to use Chapter 13 to manage their debt needs.

What to file to start a Chapter 7 bankruptcy case

Bankruptcy is an area of the law that provides Tennessee residents with legal options for overcoming their financial burdens and debts. While some individuals with sufficient incomes may use Chapter 13 bankruptcy to manage the repayment of their outstanding debts, others may find that Chapter 7 bankruptcy's liquidation process is more suited to their needs. Certain documents must be provided to the bankruptcy courts in order for a Chapter 7 petition to begin.

First, a debtor must file a petition with the court to start their bankruptcy. The petition will include important information about the person who is filing as well as the relief that they are seeking from the court. Other documents are also required to begin a Chapter 7 bankruptcy.

What rights does a lender have to reclaim a house?

Buying a home or a parcel of property is a significant legal undertaking. The law takes seriously the transfer of land rights from one person to another; therefore, when a proposed sale of real estate is made, individuals must be sure that any and all title issues are in line. If a buyer cannot pay the full amount of the seller's asking price but still wants to purchase the property, the buyer will likely secure a loan for the amount of the purchase price that they cannot cover out of pocket.

When a mortgage loan is used to purchase property, different states look at who owns the property in different ways. In Tennessee, property transfers subject to mortgages are addressed under a title theory of law. This means that the buyer of the property does not actually hold legal title to the parcel or residence, but rather, their lender does. The buyer takes equitable title, which means that they may live on the property or in the home; however, they must satisfy the conditions of their loan in order to obtain legal title.

Understand the difference between secured and unsecured debt

Buying a home can be a massive undertaking for a Chattanooga resident. After saving their money and enduring exhausting searches for just the right property, they may take the plunge and make an offer on the house of their dreams. If their offer is accepted, they will quickly find themselves in the process of securing a loan and taking ownership of their new residence.

Not everyone who buys a home, though, is able to keep up with the financial management of their home loan. Known as a mortgage, a home loan is held by a lender and repaid by a homeowner. If the homeowner fails to make payments on the loan or otherwise violates the terms of their lending agreement, the lender may take back the owner's home through a process called foreclosure.

What is a Chapter 13 repayment plan?

Personal bankruptcy is an option for individuals who cannot get out of debt and repay their financial obligations without help. There are different forms of bankruptcy that men and women may choose to pursue, and different forms of bankruptcy can meet the needs of different debtors. For Tennessee residents who earn incomes and can dedicate some of their earnings to the repayment of their debts, Chapter 13 bankruptcy may be a suitable option.

That is because Chapter 13 debtors work toward the discharge of their debts through a repayment plan. After filing for bankruptcy, a Chapter 13 debtor must file a repayment plan with their bankruptcy court. That repayment plan outlines how they will pay off their pending obligations and it must be approved by the creditors that will be paid through the plan.

Bankruptcy is an issue for an aging American population

It is a common practice of Americans to save their money so that one day they may be able to leave their jobs and enjoy their retirement years before health issues and old age deprives them of their happiness. With the help of investments, pensions, and other retirement tools, many Tennessee residents are able to achieve this dream and still have some money left over to give to their descendants in their estates. However, this is not the case for all older Americans. A disturbing study recently revealed that aging Americans are filing for bankruptcy at a much higher rate than in the past.

The study found that the number of individuals over the age of 65 who are filing for bankruptcy was 204 percent higher in 2016 than it was in 1991. This means that older retirement-aged individuals are facing financial strains as they move closer to the ends of their lives.

Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-624-4002
Toll Free: 800-257-7594
Fax: 423-624-0509
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