Business Bankruptcy

Rebuilding credit after chapter 7 or chapter 13 bankruptcy discharge

by Alejandro Uria |September 30, 2017 |0 Comments | Business Bankruptcy, Personal Bankruptcy

There comes a time for many people when they’re facing bankruptcy and wondering what it will do to their credit report. 

Even if you have responsibly managed your money things can happen such as a divorce or an accident that puts you out of the workforce. Do not let people make you feel bad about this.

Maybe your medical bills were just way higher than you could’ve anticipated. Maybe someone stole your identity and fixing it has become too much of a problem. 

Whatever the reason is don’t fear because the bankruptcy system was set up to help you reset if you get into one of these extremely difficult situations. It is not really designed to wipe you out but to give you a second chance.

How Will Chapter 7 or Chapter 13 Bankruptcy Affect My Credit Report?

Most people will file for either Chapter 7 or Chapter 13 bankruptcy.

In brief Chapter 7 is the kind of bankruptcy that discharges almost all your debts. Chapter 13 is more of a reorganization of debt with a plan to pay creditors back over 3 to 5 years.

Both of these types of bankruptcy will show on your credit report and public records for up to 10 years but they will have less and less impact on your credit score as years go by. 

Of course this is only true if you make moves to help improve your credit after bankruptcy. Things like paying all of your bills on time, getting secured credit cards, and keeping balances below 25% of your credit limit per card can help you get a better score within 3 to 5 years.

Credit Worthiness Versus Credit Reports In Bankruptcy 

While we hear about credit reports all the time they are not the same as our credit worthiness. You can pay your credit cards faithfully but still have a worse credit rating than someone who doesn’t if your income to debt ratio is too high. 

Creditors might consider you a risk because you don’t seem to be able to pay off the amount of credit you already have. For many people discharging the debt can actually raise their credit rating because you cannot declare bankruptcy again for eight years between Chapter 7 bankruptcy claims. For others it will hurt their credit rating. Sometimes the amount of debt discharged during bankruptcy can affect your credit worthiness for certain creditors.

Declaring bankruptcy or even beginning the process and stopping before discharge will all be reported on your credit report. If you do declare bankruptcy you should see on your credit report the words discharged by bankruptcy or debt included in bankruptcy and a zero balance next to the charges.

If you do not see a zero balance you should contact the credit reporting agency and dispute the claim. You are entitled to see your report every year from all three companies and you can dispute the charges without hiring a company.

Talk To A Lawyer About Declaring Bankruptcy And Which Option Is Best For Your Particular Credit Reports.

If you are considering bankruptcy it is helpful to consult with a bankruptcy lawyer to determine what your best option is and how much impact this will have on your credit report.

Bankruptcy doesn’t have to ruin your life but the more information you armed with at the start the more successful you can be at starting over.

About the Author: Alejandro Uria is a guest blogger in Lista Legal, an online attorney directory. The information on this article is for educational purposes only and under no circumstances it should be taken as legal advise.

How to know if I should File for Bankruptcy?

by Jorge Halperin |April 26, 2017 |0 Comments | Business Bankruptcy

There are two different types of bankruptcy, Chapter 7 and Chapter 13. Understanding which one is right for you is as important as understanding if Filing for Bankruptcy is the right thing for to do.

If you live in San Diego, CA, I  strongly recommend consulting with a Bankruptcy attorney here in San Diego. They can help you review your financials in order to evaluate different alternatives like Debt Consolidation, Debt Management, or Filing for Bankruptcy.

Filing for Bankruptcy may seem like a very bad thing to do and many people mistake it as a crime or cheating the law.

There are laws that protect Banks and Financial Institutions but there are also laws that protect consumers as well. Financial difficulties can definitely hurt individuals, families, and even make a person suffer from a lot of stress causing illness and depression

If you owe more than what you own and there is no foreseeable way in which you can repay your creditors, then you should consider filing for bankruptcy.

With the rising cost of living, unemployment and shrinking salaries, many people are facing monetary hardships. They find themselves scrambling to make minimum payments or facing late fees.

Here are some common signs that your finances are getting out of control and maybe you should talk to an attorney about the possibility of filling for bankruptcy.

  • You missed several monthly payments on your mortgage, your car, credit cards
  • You don’t have the money to pay for rent
  • You don’t have the money to buy food and continue using credit cards
  • You put most charges on a credit card and then don’t have the money to pay or only make the minimum payment.
  • You don’t know how much money you owe
  • You lost your job and are unable to make monthly payments

When you talk to an bankruptcy attorney in San Diego, you should gather as much of your financial information as possible.

Here is some common paperwork your attorney may need to get an accurate picture of your finances.

  • pay stubs that show how much you make an hour and how many hours a week you work,
  • tax returns that show how much you make a year
  • statements from your Credit Cards or Creditors showing how much you owe and what the interest rate is.

The idea is to evaluate your income to debt ratio.  Your lawyer will use this to determine whether it is possible for you to make payments in a timely manner and get out of debt.

If you are filing for bankruptcy, talk to a bankruptcy lawyer in San Diego, and he will help you take the steps to make it as painless as possible and answer all your questions.

Bankruptcy for Small Business Owners

by Jorge Halperin |April 26, 2017 |0 Comments | Business Bankruptcy

If you are a small business owner and you are in financial trouble, filing for Bankruptcy Chapter 7 may be the right thing to do.

With the economy going up and down, the political changes, and rising cost of living, many small businesses struggle to survive.

Even if a small business makes a profit they may find that their business or personal debt keeps increasing until the business owner can no longer make the payments.

Read more to find out what happens to your business after you file for Bankruptcy Chapter 7.


Can I keep my business if I file for bankruptcy?

Many small business owners have asked me if they can still own and operate their business if they file for a Bankruptcy Chapter 7.

This depends on if your business has assets.  If there are assets a bankruptcy trustee will be assigned to inventory and sell to action all of your non-exempt business assets. The fruit of the sales will be used towards paying your creditors.

There are a few exemptions for business assets that you won’t need to sell. You can ask an attorney about which ones are the exemptions and if they apply to your case.


Can I file for bankruptcy if my business is a Corporation or Limited Liability Company?

If you operate your business as a Corporation or a Limited Liability Company, the bankruptcy trustee will be able to liquidate your business, sell the actions, or sell the ownership of the business.

You may be able to buy the business back, but if you need to borrow money from your friends or family this may get you into even more financial problems than you already have.


Can I file for bankruptcy if I’m a Sole Proprietor?

Many small businesses are run and operated by the business owner/sole proprietor. This is common for service oriented businesses like carpet cleaners, yoga instructors, handymen, etc.

This type of small business usually doesn’t have a lot of valuable assets that can be possessed by the bankruptcy official to pay your creditors.  In this situation you can still keep your business and continue operating it after you file for a Chapter 7 Bankruptcy.