In this article, you will learn…
- What debts are discharged in Chapter 7 Bankruptcy,
- What assets are protected in Chapter 7 Bankruptcy, and
- How long a bankruptcy will appear on your credit report.
Can I Get Rid Of My Medical Debts In A Chapter 7 Bankruptcy?
One of the main reasons that people file a Chapter 7 bankruptcy is to get rid of medical debts. Medical debts are absolutely dischargeable.
How Common Is It For Americans To Have Medical Debt Nowadays?
The three most common reasons for people to file bankruptcy in America are:
- Being laid off, and
- Medical debt.
Can Debt That Is Already In Collections Be Included In A Chapter 7 Bankruptcy?
Debt that are already in collections can be included in a Chapter 7 bankruptcy. Any debt that existed prior to the day that you filed for bankruptcy is dischargeable unless fraud is alleged. Even debts that you don’t recall or have knowledge of would be dischargeable in most situations.
The only debt not dischargeable in a Chapter 7 bankruptcy would be anything that came into existence after you file for bankruptcy or debts where fraud was alleged.
Can You Protect Any Assets In A Chapter 7 Bankruptcy?
If you have been a resident of Florida for two or more years, your primary residence will be a protected asset in a Chapter 7 Bankruptcy in most situations. Outside of being foreclosed on by the mortgage company or HOA for nonpayment of fees, creditors are not able to seize your primary residence.
Another common exemption under Chapter 7 bankruptcy is your vehicle. There are some factors that may determine whether or not your vehicle is a protected asset. Right now, used car values are at an all-time high. That makes it a little more difficult for some people who own their car outright because there are only so many exemptions you can use. The value of your vehicle can create an issue.
If you still owe money on your vehicle, you are normally able to keep your vehicle as long as you are making your payments and there is not an abundance of equity in the vehicle.
I Am Not Behind On Any Of My Credit Card Bills. Can I Still File A Chapter 7 And Include Those Debts?
You can still file a Chapter 7 bankruptcy and include your credit card debts even if you are not behind on your payments.
There is no magic timeline you have to use when you decide to file for Chapter 7 bankruptcy. Some people file for bankruptcy after they have missed a string of payments, while others will file for bankruptcy before ever missing a payment.
Perhaps they have received some bad news of an impending lay off and know that they won’t be able to maintain their debts. There are others who are scraping by making their payments but come to the realization that the way they are living is not sustainable and they need relief.
You don’t have to wait to file bankruptcy. As soon as you decide that your debt situation is a burden from which you need relief, you can file Chapter 7 bankruptcy.
How Long Does A Chapter 7 Bankruptcy Stay On My Credit Report?
A Chapter 7 bankruptcy generally stays on your credit report for a minimum of 7 years to a maximum of 10 years. It is rare for it to fall off in less than 10 years.
Will The Bankruptcy On My Credit Report Be A Hindrance For Me In Buying A Car Or a Home?
A bankruptcy on your credit report will typically not be a hindrance for you in buying a home or a car.
There is a time period you must wait to buy a home, depending on the loan program you are pursuing. For example, you must wait two years before qualifying for an FHA-approved mortgage. As long as you meet the requirements for your specific loan program in terms of credit score and income, you shouldn’t run into an issue. After bankruptcy, your debt-to-income ratio is greatly improved, which will be beneficial in getting approval.
Most car dealerships will approve you for a vehicle loan as long as you have a discharge for your bankruptcy. You can usually get a car pretty much right after you file for Chapter 7 bankruptcy.
For more information on Medical Debts And Chapter 7 Bankruptcy, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (407) 305-5599 today.