Credit cards may be a convenient way to shop, make large purchases, and manage spending, but the bills can easily start to pile up, especially when life’s unexpected challenges present themselves. Eventually, credit card debt can become so unmanageable that payments barely cover fees and interest payments. In these situations, almost no payments made will go towards paying down the debt itself.
For those who are struggling with unmanageable credit card debt, bankruptcy can be a viable option for getting credit card debt under control and giving a person a “fresh-slate.” So, how do you know if and when bankruptcy is right for you?
At the Law Office of Steven D. Barnette, P.C., our Virginia bankruptcy lawyers will be ready to help you get on the path to financial freedom. We can assess your situation and discuss the legal options that may be available to you. We understand how debt can impact you today and into the future. If you need more information about bankruptcy and how it could be the path towards clearing your credit card debt, contact us today.
Credit Card Debt and the Impact It Can Have On Your Life
Carrying a load of credit card debt can be a heavy burden. Significant credit card debt can hurt a person’s credit score and inhibit their ability to draw new lines of credit. Debt doesn’t just impact getting approved for new credit cards, but it can also affect a person’s ability to get a loan. If a person is lucky enough to secure a loan, typically, that loan will carry a high interest rate.
Mounting credit card debt may also impact an individual’s ability to secure housing in the form of an apartment or rental unit. In many rental situations, a landlord or management company will conduct a credit check. If the credit check reveals high credit card debt or a low credit score, you may be considered an undesirable candidate for the unit. Increasingly, professional fields are also conducting credit checks before hiring. Carrying a large amount of credit card debt can impact a person’s ability to secure a job.
Debt can even take a heavy toll on a person’s emotional health and wellbeing. It can make people feel stressed, anxious, and eventually. The stress and psychological impact of debt can even strain relationships and push people to their breaking point.
Could Bankruptcy Help Me Clear My Credit Card Debt?
In some cases, it may be beneficial to examine the possibility of filing for bankruptcy to help clear credit card debt. Chapter 7 bankruptcy may discharge most unsecured and nonpriority debt owed to creditors. Unsecured debt is money that a person owes that is not secured by a form of property. In other words, it is debt that cannot be paid back by a company repossessing the property. Unsecured debt may include medical bills, personal loans, and most credit card debt.
Chapter 7 has its limitations. Credit card debt incurred through fraud cannot be discharged. Charging “luxury” goods or services to a card within 90 days of bankruptcy will also not be discharged. Luxury goods are considered purchases over $725.00 to a single creditor. Cash advances made on credit cards are, likewise, not dischargeable through bankruptcy.
Chapter 13 bankruptcy might also be a viable option. Through Chapter 13, a person is put on a payment plan that can last anywhere from three to five years. This plan may cover part or all the debt owed to creditors. At the end of the repayment period, any remaining unsecured debt could be discharged. A Chapter 13 bankruptcy is not as quick or easy as Chapter 7, but it does drop off a credit report faster and it may allow a person to keep their home or other assets.
How a Virginia Bankruptcy Lawyer Could Help
No one wants to stay buried under massive credit card debt, and sometimes it feels like there is just no way out. At the Law Office of Steven D. Barnette, P.C., we want you to know that you do have options, and we will be ready to provide the knowledgeable legal counsel you need and deserve.
If you are ready to get rid of the heavy burden of overwhelming credit card debt, contact our Virginia bankruptcy attorneys today. An initial consultation with us could be the first step towards your new beginning.