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Tyler Texas Bankruptcy Law Blog

What is required to file for Chapter 13 bankruptcy? Part I

People in Tyler who are facing financial difficulties may decide that filing for bankruptcy is the right choice for them. Some may decide to file for Chapter 7 bankruptcy, as the process is relatively quick from start to finish, so they can move on with their lives with a fresh financial start. Others may want to file for Chapter 13 bankruptcy, especially if they think they can pay back some or all of their debt given time or if they want to preserve assets that might be lost if they file for Chapter 7. However, they should keep in mind that not everyone qualifies for Chapter 13.

First of all, an individual filing for Chapter 13 cannot be a business entity. That being said, if a person is a sole proprietor, he or she can file for Chapter 13 as an individual, at least with regards to the debts for which he or she is personally liable.

Tyler residents should be wary of debt settlement offers

Offers from debt settlement companies can seem so alluring to those in Texas struggling with unmanageable debt. For one lump sum payment, these companies offer to work with a debtor's creditors to forgive the remaining debt. Unfortunately, oftentimes these offers are too good to be true.

For example, negotiations between a debt settlement company and a person's creditors could take years. And, while debtors are told not to pay their bills while negotiations are ongoing, they could still be sued by their creditors. Chapter 7 bankruptcy, however, can be completed in months and halt collection activities, saving time, money and stress.

Federal law protects debtors from harassment, misrepresentations

Even the most financially responsible people in Texas may someday face an unexpected financial calamity that causes them to be unable to pay their bills. Being unable to pay your bills can be incredibly stressful, especially once the calls from debt collectors start coming in. However, there are limits to what debt collectors are allowed to do.

Under the federal Fair Debt Collection Practices Act, it is against the law for debt collectors to engage in tactics when trying to collect on a debt that are harassing, oppressing or abusive. The FDCPA also states that debt collectors cannot make misrepresentations.

Are one or more of these situations causal factors to your debt?

Do you have money problems? If you answered yes, you are likely not the only reader in Texas to do so as many people are currently facing serious financial crises and are wondering how to resolve their problems and get their heads back above water. The first step toward solving your financial woes may be to take a look back at what caused them to start. Perhaps you thought things were going along quite well and before you knew what was happening, creditors were calling you every day, demanding payments.

There are several types of financial situations that people sometimes overlook that can cause economic instability. If you've already researched several options and haven't found the one that describes your situation, you may be feeling a little overwhelmed and anxious right now. The answer may simply be something you just haven't thought about yet; however, if you know where to turn for guidance, this may be the key to overcoming your current obstacles.

Is there any hope for Tyler homeowners facing foreclosure?

Sometimes even the most responsible of homeowners can fall on hard financial times. It only takes a job loss, a serious illness or any other financial calamity that causes a homeowner to fall behind on their mortgage payments. This can be incredibly distressing, particularly if a homeowner is facing the threat of losing their home to foreclosure. However, homeowners in Tyler should know that there may be some alternatives to foreclosure that may be worth looking into.

First of all, lenders may agree to a special forbearance. This means that the homeowner may be relieved of their duty to make mortgage payments temporarily. If that is not agreeable to the lender, the lender may alternatively agree to a temporary change in the homeowner's repayment plan, based on the homeowner's specific circumstances and a showing of their ability to make payments under the new plan.

Debtors filing for bankruptcy must undergo financial counseling

In general, when a person in Texas decides they want to file for bankruptcy, within 180 days of doing so they must complete a credit counseling course. Also, before a person's debts can be discharged through bankruptcy, the debtor must complete a debt management course. These courses are designed to help ensure that debtors make sure they truly want to file for bankruptcy, and also to provide them with the information needed to hopefully deter having to file for bankruptcy a second time.

The pre-bankruptcy course will cover a number of topics. First of all, the debtor's personal finances will be reviewed. If the debtor has any choices besides filing for bankruptcy, these will be gone over. Finally, a budget will be developed. The course is not onerous. It usually lasts only around 60 minutes. Moreover, while it can be done in-person, it can also be completed on the Internet or through a phone call. When the course is completed, the debtor will be given an official certificate to include in their bankruptcy filing.

Helping you navigate the business bankruptcy process

Dealing with financial problems is never easy for Texas businesses. While some debt problems can be overcome with some simple budgeting and saving strategies, major debt problems often require more aggressive steps. While just hearing the term bankruptcy is likely to induce concerns and fears, this process can actually provide real and rational solutions for businesses dealing with too much debt.

At the Law Office of Gordon Mosley, we understand that it is never easy for a business owner to decide to file for bankruptcy. Nonetheless, many businesses file for this form of debt relief because it does provide the ability to eliminate debt and even keep a business afloat. Thus, we are dedicated to helping Texas business owners understand their options and how best to approach the bankruptcy process.

Can filing for Chapter 13 save your home from foreclosure?

Owning a home is a source of pride for many in Texas. Our homes are where we rest our heads at night, where we raise our families and where we celebrate holidays and other special occasions. In the end, "be it ever so humble, there's no place like home."

This is why, when homeowners in Texas fall on hard financial times, and are unable to keep up with their mortgage payments, the threat of foreclosure causes them significant stress. The thought of losing one's home is unbearable, but when a homeowner cannot pay their mortgage for a few months or more, their lender may pursue foreclosure. Through foreclosure, the creditor retakes possession of the home, and sells it at a public auction. Then the proceeds from the sale are used to pay back the mortgage.

Chapter 7 Bankruptcy and the means test

If you are dealing with an overwhelming amount of debt, you might wish to know more about the available options for relief. While there may be numerous outlets for debt relief, the correct path on which to pursue a healthier financial future could depend on your current circumstances.

Perhaps you are continually unable to make monthly payments and have fallen well behind as a result. You might be in search of a more permanent solution and wish to explore the possibility of filing for Chapter 7 bankruptcy, but you might need to find out if you are eligible before proceeding.

What is the Chapter 11 automatic stay?

Sometimes even the best of businesses in Texas can fall on hard times. Whether it is a downturn in the economy, an increase in competition or an unexpected loss of sales, a business may find itself floundering in a sea of debt. For some businesses, the best way out of this debt is through filing for Chapter 11 bankruptcy, also known as a reorganization bankruptcy. This can especially be useful, as filing for Chapter 11 bankruptcy can put an automatic stay on creditor actions.

An automatic stay gives the debtor time in which all collection efforts, repossessions and the foreclosure processes are put on hold. In general, creditors cannot proceed on any of these actions, so long as they took place before the business filed for bankruptcy. This gives the business a "breathing spell" in which it can try to negotiate a way with its creditors to reach a resolution regarding their debts.

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