Philadelphia Bankruptcy Law Blog

Debt snowballs and bankruptcy options that might help you

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Credit Card Debt on Tuesday, June 13, 2017.

When you are facing mounting debts, paying some of them off might seem like it is impossible. It is understandable that you might want to review some of the ways that you can get out of debt. One of these options is to use the debt snowball payoff method.

The debt snowball method uses a mental trick to help you pay off accounts. You start by paying as much as you can, while still paying your other bills, on the smallest debt you have. Once this debt is paid off, you move to the next smallest debt. As you move down the list, you put what you spent on the previously paid off debt toward the next debt on the list.

Bankruptcy isn't an easy way out, so don't fall for that

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Chapter 13 on Friday, June 2, 2017.

Chapter 13 bankruptcy is a form of bankruptcy that enables you to repay some of your debts by following a set plan that is ordered by the court. This type of bankruptcy also allows you to hang on to certain assets. If you are swimming in debt and have some funds available for making payments to the bankruptcy trustee, you might consider this option.

We know that you might be wary to file bankruptcy at all. This is often a difficult decision, partially because people tend to focus on the negative connotation surrounding bankruptcy. It is imperative that you look past this connotation and think carefully about how bankruptcy might help you to improve your situation.

Take control of your credit card debt right away

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Credit Card Debt on Friday, May 19, 2017.

Many people think that if they are swimming in credit card debt that they have to hide that fact and just struggle through trying to pay it off. This isn't necessarily the case. In fact, many people who are struggling with credit card debt are in this boat because of an uncontrollable situation like a major illness or job loss.

We know that you might want to take care of the debts that you have; however, you might need to consider bankruptcy to help you get the financial freedom that you need. You might be suffering physically because of the debts. Having to worry that it is a debt collector every time the phone rings or dreading going to check the mail because there might be collection correspondence isn't a way to live.

4 steps to take when dealing with credit card debt

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Credit Card Debt on Friday, May 5, 2017.

Credit card debt seems to be the bane of the American existence -- consumers are encouraged to buy, and it's considered a sign of a good economy when people are willing to load their credit cards with debts.

At the same time, living under all that debt can be a real struggle. One unexpected expense or a single missed paycheck can send your finances into a downward spiral you can't control. If you're trying to pay off your credit cards before something like that happens, experts recommend several different approaches:

Think about how filing bankruptcy can help your creditors

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Chapter 7 on Friday, April 21, 2017.

The debts you incurred are yours to pay and you might not want anyone to be shafted by your inability to pay. This is an honorable way of thinking; however, it isn't the way you should think if you are drowning in debt.

Think about how much money a company probably spends to try to collect from you. The company might have representatives call you. They might send you demand letters. They might even send someone to your home. All of this costs money.

Missing a Chapter 13 plan payment: not the end of the road

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Chapter 13 on Friday, April 7, 2017.

When you file a Chapter 13 bankruptcy, you have to come up with a plan for making some payment to some of your creditors. How much you pay and to whom depends on a variety of factors, and calculations can be complex, so it helps to consult with an experienced bankruptcy attorney. He or she can usually help you come up with a plan that the court is likely to approve.

Once your plan is confirmed, you are responsible for making monthly payments to the trustee. Sometimes the trustee takes the money directly out of your paycheck.Other times, you must mail payment or make it via an online portal. For numerous reasons, someone might fall behind on Chapter 13 payments. Perhaps your employer failed to take out money appropriately and forward it to the trustee. You might have changed jobs and not caught up on paperwork. In some cases, you may have experienced a temporary financial crisis that caused you to be unable to make a monthly payment.

Is a short sale the right solution for your mortgage?

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Chapter 13 on Friday, March 24, 2017.

Whether or not a short sale is the right way to handle your mortgage crisis depends on a number of factors. To understand whether it might be the right step for you, you first have to understand what exactly a short sale is.

A short sale means that a property is sold for less than is owed on any related mortgage. For example, if someone owed $180,000 still on a mortgage balance and they were able to come to an agreement with a buyer to sell the property for $170,000, that would be a short sale. There would be a loss to someone -- often the bank -- of $10,000.

What are some drawbacks to secure debt?

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Credit Card Debt on Friday, March 10, 2017.

Secure debt is any debt that is secured by collateral. Collateral is something that the lender has a right to liquidate to pay off a debt that you do not pay as agreed. If you finance a car purchase, for example, the loan is secured by the car itself. The bank can repossess the car if you don't make your payments, and that's the drawback of this type of debt.

Other types of secured debt can include mortgages and rent-to-own type appliance or furniture purchases. While most people can't go through life without dealing with some type of secured debt -- especially with regard to homes or cars -- many financial experts will tell you that it can be a mistake to turn unsecured debt into secured debt.

3 ways to keep retail therapy from deepening your debt

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Credit Card Debt on Friday, February 24, 2017.

Whether retail therapy is a major reason you now find yourself dealing with debt or you simply want to shop to boost your spirit during financial struggles, continued unplanned spending typically makes the situation worse. Retail therapy makes sense: buying something nice or doing something unplanned for yourself boosts endorphins and positive feelings, which can temporarily reduce the impact of stress. The stress always returns, though, which makes retail therapy an expensive long-term solution. Here are three ways to quash your spontaneous spending habits as you work on debt and financial stability.

Put a timer on your impulse buys. Impulse buys are easy, especially when shopping online. Within 30 seconds, you can click through to check out, spending hundreds of dollars on items you might not be as excited about when they arrive. Experts recommend putting items in your shopping cart and then walking away for a few days. Many times, once stress and emotional attachment subsides, you make a different decision about the purchase.

You have options if your wages are being garnished

On behalf of Joshua Z. Goldblum, Attorney at Law posted in Chapter 7 on Friday, February 10, 2017.

If you're struggling to make ends meet and you can't make payment on all your debts, the last thing you need is someone taking up to a quarter of your paycheck from you, but that can happen. If a creditor obtains a judgment against you on the debt you owe, they can then move to get an order of garnishment that gives them the ability to levy your bank accounts or garnish your wages.

A wage garnishment means that your employer is ordered to pay a certain portion of your wages to the creditor until the amount is paid off. That means you never see that money at all -- it comes directly out of your paycheck. It can be both frustrating and embarrassing; depending on your financial situation, it can also be debilitating.

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