The Allmand Law Firm, PLLC Difference

Unlike most bankruptcy firms in the Dallas / Fort-Worth area, Allmand Law Firm, PLLC spends the time to understand the complete financial picture for every one of our clients. We provide resources, tools and advice to address the unique needs of North Texans.

Considering Bankruptcy When Dealing with Multiple Types of Debt

Posted By Allmand Law Firm, PLLC || 9-Nov-2012

Many consumers decide to file bankruptcy when one form of debt becomes an issue to keep under control, such as medical bills or credit card debt . But some consumers may not realize they can file bankruptcy when dealing with multiple types of debt. Another common reason for filing includes receiving a lawsuit or judgment related to old debt. When considering filing due to multiple types of debt it helps to understand your situation so you can obtain a favorable outcome for your finances.

Old debt may include different forms of debt including credit card, medical and back taxes. Creditors have a certain amount of time to purse collection attempts until it runs out; also known as statute of limitations. This can extend for a few years to several depending on the type of debt and state regulations. If limitations have passed on the debt, meaning creditors can no longer collect against it, you don't want to make any payments on it since it would restart the limitations again.

Current debt may include payments you're making on a vehicle loan, mortgage or other accounts currently active. Bankruptcy may be sought in this case if a consumer is looking to maintain their assets such as their home or car. Chapter 13 bankruptcy may help you obtain affordable payments under a court-approved repayment plan that lasts 3 to 5 years.

Back income taxes are often an issue on their own. Getting them discharged may be possible when meeting qualifications or a repayment plan approved by the court could help manage payments. A lawsuit or judgment may lead to garnishment of wages or bank funds. Bankruptcy may stop collection efforts in this situation. In the end, you'll want to compare the types of debt you have and learn if bankruptcy can help minimize or eliminate obligations in the best way possible.

Categories: Bankruptcy
Blog Home