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Southaven MS Bankruptcy Law Blog

Feds crack down on false promises to stop wage garnishment

Countless residents of Mississippi are grappling with student loans, whether they are fresh out of school or graduated many years ago. Some are able to work their loan payments into their existing budgets, while others may discuss their financial challenges with the lender in order to obtain a deferment or temporarily reduce payments. For others, missed payments may be a reality due to overwhelming financial problems such as massive debt or unemployment. In such cases, these individuals may be facing the thought of or undergoing the experience of having their wages garnished.

Just like a vehicle repossession, a wage garnishment can be very emotionally stressful, as well as potentially embarrassing. Moreover, the garnishment itself produces added financial stress, since money is taken directly from a person's paycheck. Since garnishment is such a difficult process to endure, some companies have emerged in recent years with claims of offering significant debt relief. In reality, some of these companies are scams and end up doing graduates more harm than good.

Navigating the Chapter 13 bankruptcy process

When a Mississippi resident decides that personal bankruptcy is the right solution for them, they will likely need to first decide which type of bankruptcy to file. An individual in need of debt relief may file Chapter 7, which involves asset liquidation, or Chapter 13, which involves adhering to a repayment plan concerning a portion of eligible debts.

Not everyone can file for Chapter 7. In addition, some may decide that Chapter 13 is more appropriate. But, navigating Chapter 13 bankruptcy can be tricky without knowing everything about the process. Our firm's Southaven bankruptcy attorneys understand our clients' rights and obligations when filing for Chapter 13.

Does bankruptcy stop car repossession?

When a person is severely in debt, that person may resort to selling off personal property in order to either repay debt or make ends meet. While many are willing, if reluctant, to part with items like jewelry or electronics, many understandably fear losing their home or car. Asset forfeiture is a threat to Mississippi residents who are in over their heads financially. Fortunately, there are legal options available for avoiding these scenarios.

In the case of a potential vehicle repossession, a debtor can utilize personal bankruptcy as a means of stopping asset forfeiture. In many cases declaring bankruptcy will put an immediate end to not only collection efforts, but also to repossession actions. In some cases, a Mississippi bankruptcy attorney can help a debtor get his or her car back if it has already been repossessed. However, legal action must be taken within 10 days of the repossession itself.

Impact of the nearly decade-old BAPCPA on Chapter 7

Next year, the Bankruptcy Abuse Prevention and Consumer Protection Act will turn ten years old. Over the past decade, the reforms brought forth by the act have changed the way many individuals, both nationwide and in Mississippi, file for Chapter 7 bankruptcy. Those intrigued by the benefits of Chapter 7, such as the elimination of certain debts, may wish to know more about the reform's key effect regarding eligibility.

In the spring of 2005, the law, often known as BAPCPA, was signed by then-President Bush. While it ushered in several changes, one of the primary effects was stricter eligibility requirements regarding Chapter 7 bankruptcy. Since the law's passage, those wishing to file for Chapter 7 must now pass what is called a "means test." Under the conditions of the test, a person whose monthly income is less than their state's median income can file for Chapter 7.

Seniors face increasing need for debt relief

It's often thought that bankruptcy is an appropriate option for Mississippi families struggling with overwhelming debts. While this is indeed frequently the case, there are many more types of people who can benefit from the debt relief provided via personal bankruptcy. One such group is senior citizens. According to recently-released information from the Consumer Financial Protection Bureau, older Americans are increasingly troubled by both debt and debt collectors.

Per the CFPB, seniors make more complaints regarding debt collectors than they do about any other service or product. Between last year and this year, many of the submitted complaints focused on debt collectors who attempted to collect from the wrong person, collectors who used harassment or intimidation, to the complete lack of important information about the debt itself.

Key qualifications for Chapter 13 bankruptcy

Filing for bankruptcy is one of the most important decisions that some individuals may ever make. When an individual or business is in dire need of debt relief, bankruptcy can almost immediately alleviate the burden. For individuals who decide bankruptcy is right for them, deciding whether to file for Chapter 7 or Chapter 13 can be crucial.

There are many key differences between these two types of personal bankruptcy, but the most well-known is likely how each one handles existing debts. Under Chapter 7, many of an individual's qualifying debts are eliminated. Under Chapter 13, an individual agrees to a repayment plan; at the end of the repayment period, many of the qualifying debts are eliminated. Chapter 13 presents many advantages, such as the ability to rebuild a history of solid payments to creditors under the plan. Before filing for Chapter 13, though, a person must meet several important qualifications.

An attorney's advice often critical regarding credit card debt

Some Mississippi residents may believe that an attorney is only needed for certain financial challenges involving overwhelming debt, such as the threat of losing one's home, car or other forms of personal property. A bankruptcy attorney, however, can also help with seemingly "smaller" debt situations, such as credit card debt that has spiraled out of control.

Like all forms of debt, credit card debt can grow quite rapidly if even a few delinquent payments accumulate. Credit cards often have interest rates that are much higher than other forms of debts, such as federal student loans. As a result, even one missed payment can mean that the amount owed has grown sizably; moreover, the debtor must often pay fees associated with even a single late payment. When multiple late or missed payments add up, the final product can be debt that has gone from slightly unmanageable to completely insurmountable.

Link between Medicaid status quo and bankruptcy

In many states across the country, the Medicaid expansion has brought forth both praise and criticism. Mississippi decided not to participate in the Medicaid expansion, and not surprisingly, this move has also had both supporters and detractors. Some believe that the state's refusal to expand the healthcare program will negatively affect struggling residents who have unpaid bills related to medical expenses.

According to some recent studies, debt from medical bills is the biggest reason for personal bankruptcy in the U.S. In a struggling economy, issues like unemployment exacerbated the rising costs of healthcare. As a result, many in Mississippi and beyond have found themselves unable to pay the staggering bills for things such as surgery, the delivery of a baby, cancer treatment, broken bones and the like. The Commonwealth Fund reported that between 2005 and 2010, the number of Americans who indicated they had trouble paying medical bills rose by about 14 million.

What are the Mississippi Chapter 7 pros and cons?

The type of bankruptcy most individuals in Mississippi are likely to be familiar with, even if they have never declared bankruptcy themselves, is Chapter 7. Under Chapter 7 bankruptcy, many of a person's assets are liquidated to repay creditors. As a result, this type of bankruptcy is very attractive to those who struggle to cope with burdensome personal debt. On the other hand, some debtors may be hesitant to file since they worry about the credit-related drawbacks of this type of debt relief.

There are many different pros and cons of declaring any type of bankruptcy, and Chapter 7 for individuals is no exception. One of the main downsides related to credit is that Chapter 7 harms a person's credit score for years, as this type of bankruptcy can stay on a person's credit report for up to a decade. Nonetheless, the actual Chapter 7 process lasts only about three to six months. So, the tradeoff is a damaged credit score, but a relatively quick way to get out from under overwhelming debt.

The basics of vehicle repossession

One of the worst things that can happen to a driver is falling behind on car payments. In Mississippi, cars are essential for getting to work, transporting family members and simply carrying on with day-to-day living.

Being without a car is what often befalls those who become too far behind on their vehicle payments. When one finances or leases a car, their creditor holds crucial rights. These rights conclude when the car is paid-off, but until then, drivers must understand and acknowledge these rights. Unlike other assets, such as a home, vehicles can often be seized by creditors without a lengthy legal process or warning in advance. This is known as repossession and usually happens after the driver has missed a number of payments.

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Subscribe to this blog's feed Visit Our Bankruptcy Law Website Heidi S. Milam

Attorney at Law, P.L.L.C.
7160 Tchulahoma Road, Suite A5
Southaven, MS 38671

Phone: 662-655-1605
Toll Free: 888-341-8136

Fax: 866-267-5360