Bankruptcy to Eliminate Consumer Debt

consumer bankruptcy, consumber debt, consumer bankruptcy attorneyIn bankruptcy lingo, the term “consumer debt” is often used to clarify how debts have been incurred. Different from business debt, consumer debt involves funds used for consumption rather than investment. Consumer debts are typically classified as such based upon the purchase of consumable goods that do not appreciate in value, such as those things that are purchased to pay personal or household expenses.

More about Consumer Debt
You’ll hear some other terms associated with consumer debt such as secured, unsecured, variable interest rate, fixed rates, and deductibles. It is helpful to understand the meaning behind these terms. It is also important to understand that not all consumer debt is considered to be negative. (Your mortgage is a good example of this.) Any debts that have high interest rates, such as credit cards, auto loans and some student loans, are typically considered bad consumer debt. Most recent studies indicate that the average U.S. Household Debt is increasing. For the first time, credit card debt is approaching one trillion dollars. In 4Q of 2015 alone, consumers racked up more new debt than in 2009, 2010, and 2011 combined. There is a level of economic concern when consumer spending goes far beyond what can be paid back.

Consumer Debt and Chapter 7 Bankruptcy
The good news is that if your debts are mostly consumer debts, half or more of your total debt, then you may be eligible to file Chapter 7 bankruptcy to eliminate debts. A Debt Advisors bankruptcy attorney may administer what is called, “The Means Test.” This, among other factors, will help determine what kind of debt you have, how much, when the debt incurred, what the purpose was, who made the purchase, etc. During the calculation of consumer debt, both spouses and debt incurred by children living in the home will be included. There are some surprises too, like the fact that medical bills are usually classified as non-consumer debts.

When filing bankruptcy, the determination of which debts are business or consumer can get a little tricky. Hire an experienced consumer bankruptcy attorney to ensure that your bankruptcy is filed correctly the first time. Your attorney will conduct a thorough debt analysis and cover all the bases to avoid any potential bankruptcy disputes in court. (The bankruptcy trustee and court will review each debt closely, and you will need the appropriate documentation.) Ask for our free consultation to get information you are looking for right now.  Bankruptcy may turn out to be the best financial decision you have made regarding oustanding consumer debt.

Can Bankruptcy Help Identity Theft?

identity-theft-and-bankruptcy

Last year nearly 500,000 complaints of identity theft were reported to the Federal Trade Commission.  Anyone with a social security number could be a potential target for identity theft.  You may be surprised to hear that of the complaints filed, more than 20,000 involved minors.  All identity theft is a loss, but one of the most difficult to deal with is identity theft of a minor.  Kids are prime targets; they don’t apply for credit for years, and they have a clean social security number to work with.  If your minor child has become a victim of identity theft, file a police report, and report the issue to both the Consumer Protection Bureau and Federal Trade Commission.

 

The FTC has also released a report outlining the current situation in America regarding identity theft.  Here are the interesting points noted:

  • -Id theft pertaining to wage or tax dollars is reported at the highest rate, representing 46%
  • -Credit card fraud comes in second at 16%
  • -Identity theft can negatively affect your credit score
  • -Military members are a prime target due to the ease of obtaining   personal social security numbers
  • -Children are at risk, although it may go unnoticed for many years

 

Protect your Family from Fraud

When data breaches happen, they can place the private information of people at risk.  With access to so much information, and security moving too slowly to protect it, the internet is an identity thieves dream come true.  Besides fraud alerts, consumers should also frequently check credit reports.  If the theft goes too long, victims of stolen identity can find themselves in a real uphill battle trying to prove to credit agencies that charges were not made by someone other than themselves.  Identity theft is a growing problem that in the most severe cases leaves people feeling helpless.  At some point, no amount of time or money is enough to reverse the damage that has already been done.  One thing you can do to protect yourself and family is to place a “fraud alert” on credit profiles.  For a minor child, submit request for all credit agencies to place a “security freeze” on accounts until the child is at least 18 years of age.  Wisconsin in one of many states who allow credit freezes for minors.  If you have already become a victim, hire a reputable bankruptcy lawyer to provide the guidance and resources that you will need at a time like this.

 

Debt Dischargeable in Ch. 7 Bankruptcy

The great news about bankruptcy is that credit card debt and most other unsecured consumer debts are dischargeable in Chapter 7 Bankruptcy.  If you’ve experienced identity theft, it’s likely that there are multiple unsecured debts involved including some you have not yet been made aware of.  Once the petition is filed for Chapter 7, creditors will no longer be able to harass you about these debts.  You and your bankruptcy lawyer will work together to uncover and gather information.  Resolving all of your debt issues through the bankruptcy code will be less expensive and quicker than trying to tackle them one by one.  After it’s all said and done, your credit score can begin to improve and you can begin to rebuild your life.  More tips on how to rebuild credit after bankruptcy. #debtadvisors

Ins and Outs of Debt Collection and Consumer Rights

 

questions about bankruptcy, consumer rights, credit card debt, wisconsin consumer laws

 

Credit card companies, hospitals, schools, utility companies, banks, or even payday loan stores extend services and credit to nearly everyone, but not everyone is able to return payment.  Although the intentions of consumers may be to pay back each line of credit; a job loss, illness or other life event that prevents us from working can make this very difficult.  Millions of Americans are contacted by debt collectors each year.  State and federal agencies are receiving more complaints about unfair or deceptive practices than any other part of the consumer financial system. 

Accumulation of Debt:  Families with children under eighteen, those without health insurance, and those that have experienced more than two months of unemployment are more likely to hold a credit card balance.  Credit Card Debt Statistics  Once any type of debt becomes overdue, the very companies that extended credit and asked for your business will become focused on collections.  If the company is not successful in obtaining payment for past due amounts, or if a payment plan has not been established, they may hire a third-party “debt buyer agency” to collect for a percentage of the original debt value.

Wisconsin Consumer Rights:  If a third-party debt collection agency is contacting you on behalf of a creditor, it can be helpful to know the statute of limitation that applies to your specific debts. If the statute of limitation has expired, a debt collector cannot sue to collect.  Any debtor has the right to obtain “verification” of the debt and to dispute it.  This and other laws are part of “The Fair Debt Collection Practices Act.”   The FDCPA and the Wisconsin Consumer Act has protected Wisconsin consumers from abusive and harassing debt collection tactics for more than forty years.

 FDCPA Violations:  There are many examples of debt collector abuse that are considered FDCPA violations.  For example, collectors must identify themselves and accurately identify the agency that they represent.  They cannot ask you to pay more than what is owed, threaten, or use profanity or violence.  They can’t ask for interest, fees or expenses that are not allowed by law, or call repeatedly or before 8:00 a.m. or after 9:00 p.m.  If any other violation of the FDCPA occurs, consumers have the right to sue the debt collector for damages.

Debt Collector Defense:  Once a creditor or a debt collector begins to contact you, keep records of each call including caller name and other important details.  Save all mail and emails, and ask them not to call you at work.  If you decide at some point to sue creditors for harassment, your records will be a valuable asset.  Next, contact an attorney who is familiar with Wisconsin debt collection laws and the elimination of debt.

Contact a Debt Lawyer:  Feeling that you have been harassed or deceived by a debt collector is a justifiable reason to seek the advice of an attorney.  Debt Advisors Law Offices offers a free consultation with a lawyer to discuss your experiences, financial circumstances, and options such as an “automatic stay” to stop harassment calls immediately.   Chapter 7 bankruptcy and Chapter 13 bankruptcy have helped thousands of Wisconsin Residents get back on their feet after a tough financial crisis.  The lawyers at Debt Advisors will be upfront and honest regarding whether or not the bankruptcy process is right for you.  The sooner you speak to an attorney about your particular situation, the sooner the calls can stop, and the sooner you can get back to living peacefully again.

Medical Diagnosis Often Precedes Financial Problems

mydebtMany recent studies have been done over recent years to determine who files and why. Most people who file bankruptcy carry some form of medical insurance, have an education, and are employed. Research findings repeatedly conclude that un affordable healthcare services lead to medical bills that cannot be paid; a common situation that explains why many people seek bankruptcy.

Rising medical costs lead to bankruptcy; especially for the young.

A medical diagnosis or catastrophic medical event is a sudden and unexpected life event that often precedes financial problems. Younger cancer patients have the highest bankruptcy rates. This is because younger patients are more likely to have debt burdens such as student loans, starting business costs, new home purchase, raising young families, etc. Combine these indicators with fewer assets and little or no supplemental income. Soon, it will become clear why younger people diagnosed with cancer are more susceptible to bankruptcy than older folks. To benefit most from the bankruptcy filing process, seek advice from a lawyer who specializes in bankruptcy. Most initial consultations are free. Eliminating financial burdens will allow all expendable energy to be focused on a positive healing process.

Medical bills are only a hurdle.

When you or a loved one is diagnosed with a medical condition such as cancer, the diagnosis itself is devastating. The ultimate manifestation of a diagnosis like this can become economic hardship. However, the medical bills that have accumulated should only be viewed as a hurdle. While a medical team is aiding in your physical needs, allow a reputable legal team to assist in resolving your financial ailments.

Filing bankruptcy is a positive and optimistic fresh start.

Already overwhelmed by debt? Need to improve credit scores and regain financial independence?Beyond the stereotypes and misconceptions, filing bankruptcy is an affordable resolution that can eliminate most types of debt, including debt incurred from medical bills. Filing bankruptcy provides the launch pad of positive actions necessary to regain control of finances, build back your credit score, and focus on health.

Find an experienced bankruptcy law firm

Filing for bankruptcy can become an expensive and complex process if not handled correctly. Only an experienced Wisconsin bankruptcy law firm will be prepared for the task. The bankruptcy attorneys at Debt Advisors are fair, honest, considerate, compassionate about your diagnosis and helpful in these types of financial situations. They will present all of your options, steer you in the right direction. The most difficult part is making the call for your free consultation. 888-997-4917

Chapter 128 Wisconsin Bankruptcy Alternative

Chapter 128 Wisconsin Bankruptcy AlternativeOverwhelmed by debt? Making the necessary changes to take back control of finances is a key step, but sometimes easier said than done. If you’ve tried everything in your power, and still find yourself becoming further and further in debt, get the facts about your options. Rest assured, there is help available to you. It can be as simple as just reaching out. Make the call today and get some helpful advice. 888-997-4917

Doing Nothing, Fixes Nothing
If you are becoming further in debt, don’t let the fear of bankruptcy overcome the reality of the situation. Sure, bankruptcy could affect your credit score. However, the beauty of filing bankruptcy is that it provides a fresh start. This way, you’ll actually have a real chance at building back credit scores. Without some kind of action, your credit score will likely continue to fall due to missed payments, defaults, repossessions and potential lawsuits. Never discount bankruptcy as a realistic, reliable, and attainable solution because for many…it is just that.

Filing Bankruptcy in Wisconsin
Filing bankruptcy has been a life-saver for many Wisconsin residents. Financial relief can be obtained in as little as 3-6 months with a Chapter 7. You do lose your credit cards, but they’re likely a burden anyway, and you’ll be able to obtain new ones in as early as a year. There many other advantages to filing chapter 7 that most people are not aware of. For example, many personal property items are exempt, and you’ll get to hold on to the wages you earn and the property purchased after you have filed. Keep in mind that nothing will remove student loan debts, but filing bankruptcy may free up money in other areas to make your life a whole lot easier. Chapter 7 can only be filed once every six years; chapter 13 or chapter 128 may continue to be options in-between, if necessary.

Bankruptcy Alternative – Wisconsin Debt Relief
Chapter 128 is a decades old state-law debtor action, with a bankruptcy sounding label, although it is not bankruptcy. Chapter 128 may work well for someone who has more debt than they can handle, but can still repay with minimal help in structuring a plan. With Chapter 128, the debtor bypasses filing bankruptcy for a different course of action which includes debt repayment;forcing most creditors to accept monthly payments for as long as three years, and stopping interest from accruing on debts.Nearly any type of unsecured debt can be included in a section 128.21, although larger amounts for home and car loans often have monthly payments that are too big for debtors to be included. At the onset of the process, an automatic stay also goes into effect against creditors who are subject to the jurisdiction of the state of Wisconsin. Unlike bankruptcy, a chapter 128 debtor must repay all debts noted on their individual plan. (No debts are discharged through section 128.21.)

Debt Advisors Law Offices
If you’re interested in learning more about bankruptcy or Chapter 128, consult with a bankruptcy lawyer who understands the different roles of the debtor, creditors, attorney and trustee. An experienced bankruptcy attorney can clearly explain the differences between state debt relief and federal options. They will review your individual circumstances and provide the best option for you and your family. Request a free debt advisors consultation.

New Law Amends part of Wisconsin Consumer Act

New Law Amends part of WisconsinThe collecting, buying and selling of debt has become a multi-billion-dollar industry.  Debt Collectors will do whatever it takes to collect a debt. Sometimes called “debt buyers,” these organizations purchase charge-off debts for pennies on the dollar then often repackage and resell the debt, or portions of the debt to other agencies or firms to make more profit. The result of changing owners several times is the loss of important details associated with the original credit document.  In the event that a debtor is sued, it can be very difficult to track and verify original creditors, account numbers, dates, etc.  The FTC has made state recommendations which would essentially make it easier for debtors to verify the debts they are potentially being sued for. (Name and terms of the original creditor, last 4 digits of original account number, amount and date of the original default or charge-off, and amount currently due including principal, interest and fees.)
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Wisconsin Consumer Act Revised:  As of March 1st, 2016 parts of the Wisconsin Consumer Act have changed, but not enough to appease the FTC’s recommendations to fully protect the debtor.  For example, the new Wisconsin law does not require creditors to provide the original account number, the default or charge-off dates, or the terms of the original contract.  In addition, “specific itemization” is not required in the new law.  Many consumer advocates are disappointed in the new law because these missing details will continue to hurt consumers in the event that they are sued.

Bankruptcy Attorney Chad Schomburg:  “The Wisconsin legislator did not make the Wisconsin law strict enough on debt buyers or collection agencies.  They still have only minimal requirements when filing lawsuits against consumers, making it very confusing as to what debts they are actually collecting on.  The debtors then do not have much recourse under the Wisconsin Consumer Act.  They might be better off seeking protection through the Federal Consumer Protection Act, or more importantly, through bankruptcy.”

Debt Advisors Law Offices: Your situation may or may not benefit from bankruptcy.  To find out what your best options are, call Debt Advisors Law Offices at 414-755-2400 or find us online at MyDebtAdvisors.com.   For your convenience, we offer six Wisconsin locations.  The attorneys at Debt Advisors are experienced in dealing with credit agencies, and will steer you in the right direction.

Correlation between Home Sales, Home Foreclosures, and Chapter 13 Bankruptcy

MARCH 2In February, The National Association of Realtors posted a report stating that the home sales index rose 3.5 percent, the highest level since July of 2015. Although Midwestern states such as Wisconsin are in the middle of winter, sales surged ahead of the traditional Spring buying season. Rising home costs, fewer homes for sale, and higher expectations from lenders, had many thinking that sales would decrease. However, the opposite may be true, as the February numbers suggest a stronger than expected launch into Spring.

 

Foreclosure Crisis

Even the most optimistic of buyers can’t help to be a little cautious because in this fast-moving marketplace, things can change very quickly. It wasn’t that long ago that our nation experienced a major foreclosure crisis. Back in the early 2000’s, mortgage interest rates were very low. Buyers were able to borrow more money, and purchase bigger homes than what they would normally qualify for. Banks were largely basing their loans on the assumption that home prices would continue to rise. The assumptions were toxic and didn’t work as planned. Although most of the homes that were lost to foreclosure crisis were considered prime, the sub-prime borrowers did tend to default at a higher rate. Because the sub-prime loans were often sketchy, many experts blamed the crisis on sub-prime lending. However, other experts argue that a variety of stressful economic factors such as unemployment played a larger role. In any case, a crisis can happen at any time, to anyone, when particular conditions are present.

Stop Foreclosure

Foreclosure is the legal process whereby a bank or mortgage takes the real estate title, due to the homeowner’s failure to make mortgage payments. Although the foreclosure crisis may be over, and the market is showing some optimistic progression, hundreds of thousands of homeowners across the U.S. continue to find keeping up with mortgage payments a struggle. This is why our message is so important; if you are facing foreclosure, there are options available that could save your home.
Chapter 7, otherwise known as ‘liquidation bankruptcy,’ will allow you to eliminate a deficiency balance owed to your mortgage company, if your home is sold for less than the outstanding balance owed to the mortgage company. However, Chapter 7 will not provide the opportunity to catch up with over-due mortgage payments and will not provide the long-term protection that a Chapter 13 can.

Chapter 13 Bankruptcy

Rising interest rates and the fragile balance of our economy makes foreclosure a real threat. For many people, Chapter 13 bankruptcy can be a very powerful tool that stops foreclosure and saves your home. In fact, Chapter 13 is the driving force behind many bankruptcy petitions. Generally, Chapter 13 must be filed before the mortgage company sells your home, but as soon as you file Chapter 13, the “automatic stay” goes into effect. This stops the mortgage company from foreclosing on your home. For more information on how bankruptcy can stop foreclosure, get first-hand advice from a bankruptcy attorney. Contact Debt Advisors Law Offices directly for a free consultation, while time is still on your side. 414-755-2400.

Basic Facts Regarding Bankruptcy and Paying Taxes

paintTaxes are a part of our government body, created to support a framework of opportunity for people, families, and local communities. Here’s another fact: Our forefathers had incorporated bankruptcy into the constitution. Sure, the laws regarding bankruptcy have been tweaked over the years, but it has always been part of this country’s history. Thankfully, bankruptcy protection has expanded from businesses to also include individuals who are struggling to get out of debt.

 

Sound financial decisions
Whether we look at how the government spends our money, or at how we spend our money; it’s important to recognize where we have the most control in order to make the most of our lives. Good intentions do not equal good design. If throwing more money into a deficit isn’t fixing the problem, you may need new plan to eliminate the debt. One can absolutely take control of personal debt that has spiraled out of control. Bankruptcy law eliminates certain debts so that a new plan and a fresh start can be established. Basic tax returns are pretty cut and dry but if you’ve filed bankruptcy, are in the in the middle of a bankruptcy, or are considering a bankruptcy…you may have some questions about how it would or could potentially affect your tax returns.

A Few Things to Note Regarding Bankruptcy and Paying Taxes
• Bankruptcy or discharge of debt is not considered taxable income.
• With Chapter 7 bankruptcy, you’re still required to file an individual tax return. There are special considerations and options that your attorney will review with you.
• With a Chapter 13 bankruptcy, you’re also required to file your tax return as usual.
• Some taxes may be dis-chargeable in bankruptcy, but discharge of tax debt depends upon the details and circumstances of your personal bankruptcy case. Your bankruptcy attorney can clarify this for you.
• While in bankruptcy, you can receive tax refunds. But, they could potentially be delayed or used to pay down tax debt fees. Your bankruptcy lawyer can help determine if this applies to your case or not.
• Filing bankruptcy will not stop a tax audit.

If you have found yourself considering bankruptcy, don’t think about it as a failure, but as an opportunity to start new again.

You’re not alone, filing Bankruptcy happens and it’s a not the end…but a new beginning. The bankruptcy process is not complicated if you hire an experienced bankruptcy law firm. The best advice regarding bankruptcy and filing tax returns is to consult your bankruptcy lawyer if you have filed for a Chapter 7 or Chapter 13 bankruptcy. If you are considering filing bankruptcy, consult a bankruptcy attorney. Legal processes such as bankruptcy depend greatly on each individual set of circumstances. Debt Advisors Law Offices offers a free initial consultation to evaluate your situation and steer you in the right direction. Pay taxes responsibly; don’t risk having to pay penalties, fees and interest on unpaid taxes. Contact the IRS directly for tax-related questions that do not involve bankruptcy.

Could Federal Interest Rate Hike Cause more Foreclosures?

Rate Hike CauseAlthough nobody knew exactly when it was going to happen, the Federal rate increase last month had been predicted by financial markets for some time now. It’s the first increase since 2006, and the first time the Feds have implemented any rate hike since the most recent recession. (Federal Reserve interest rates went from a range of 0% to .25% to a new range of .25% to .5%.)There was instant chatter about more rate hikes to follow, possibly as soon as March of 2016. However, more recently, traders anticipate the next hike may not be until early 2017. The current rate hike appears minimal, but many still wonder if the economy is strong enough to handle even a small rise.

Rate hike may push homeowners into foreclosure

The housing market is supported by more than low mortgage rates, yet some home-buyers may still find it more difficult to get approved for a new home loan. Millions of American home owners and home buyers are uncertain about how this most recent federal rate increase will affect them both short and long-term. Some current owners fear that a small increase will equate to significantly more money taken from their wallets. Other consumers speculate higher interest will have minimal personal impact and a mostly positive mark on the economy. Chief economists and market strategist also have varying opinions. Some say that the increase is so small that it will have a very gradual and nearly unnoticed impact on mortgage rates. Other experts say higher rates could mean as many as one in five homeowners may face losing their homes.

Bankruptcy can save your home

Free financial advice from Attorney Chad Schomburg of Debt Advisors Law Offices.

The increasing cost of buying a home means fewer people will qualify for a mortgage loan. The larger problem may involve those who already own a home, especially those who have an adjustable rate mortgage, or those that may have taken out a home equity line of credit. It may be too soon to know what the full financial impact will be, but one thing is for sure, higher interest payments and financial pressure from many different angles may put your home at risk of foreclosure. If you find yourself facing foreclosure, don’t wait too long. (Don’t throw in the towel too quickly either.)How will you know what to do? Talk to a Debt Advisors Bankruptcy Attorney about your options. The consultation is free. If you qualify, Chapter 13 bankruptcy could save your home from foreclosure.

How to ensure your online shopping is safe & secure

How do I know an online site is safe to enter my credit card information?

When browsing online to make a purchase, there are easy things that you can look for that will reassure you that the website you’re on is secure.  Any site that asks for personal information should have an added layer of security between the browser and the website you’re connected to.  Before doing any kind of online banking or entering any kind of personal information, (including your name, contact info and or credit card information), be sure to look at the URL, or address for the site across the top of your computer screen or mobile, and ensure that you see “HTTPS.”  Internet Explorer, Firefox and Chrome will also display a “padlock” icon in the address bar to indicate the HTTPS connection.   On another note, reputable retailers and banks will NOT allow pop-ups advertising phony products or services, and you should easily be able to find a site privacy statement and return policy if applicable.

Good debt Vs bad debt

Borrowing money isn’t always a bad thing, it can actually be considered a good debt if it allows you to manage your finances more effectively.  Some examples of this could be investments in future earnings, taking out a mortgage, healthcare expenses or borrowing for a business expense.  Be cautious however, of online spending; it’s far too easy to spend beyond our financial means.  Credit card balances are bad debts that accumulate high interest charges.  The only way to avoid interest charges is to pay off the balance before the end of the current billing cycle.  Payday loans are also a form of bad debt.  If paying off a credit card balance in less than 3o days is not possible, or if you need to take out a payday loan, reconsider the long-term effects.  It’s always a better option to pay with cash, and you will spend less, avoid debt, and maintain your financial well-being.

Debit card vs credit card

DASometimes it’s difficult to see the visual differences between a debit and credit card, but the transactional process between the two is very different.  One comes directly from your banking account, the other is borrowed money.  To clarify, the amount of protection offered by both cards is essentially identical, as mandated by law.  However, because of the way debit cards are structured, unauthorized use can cause major havoc on your personal finances and take a long time to work through with your bank.  Credit card companies are quicker to alert suspected fraudulent behavior, and also offer some additional protections such as:  Disputing rights on a purchase, sometimes an extended warranty, property insurance, etc.

In financial trouble?  Find the help you need by scheduling a free, no obligation consultation with a Wisconsin bankruptcy attorney