The Truth About Liquidation
Houston Bankruptcy Liquidation Facts
There are many misconceptions surrounding the liquidation of assets during Chapter 7 bankruptcy. Many people believe that all of their worldly goods will be sold and that the proceeds go to pay any bankruptcy claim, essentially leaving the bankrupt individual with nothing left after the liquidation companies are finished. Also most people believe that under the new bankruptcy laws it is now not possible to eliminate credit card debts.
Here is how Chapter 7 bankruptcy really works for most people:
- Most and usually all of all your credit card, medical, and any other types of unsecured debts go away completely and will never be paid back.
- You keep most and usually all of the assets you owned when your bankruptcy was filed. This is because most, if not all of your assets, are exempt under bankruptcy law, which means you have the right to keep them.
- The person filing for Chapter 7 always has the option of keeping or surrendering the assets that are collateral for their secured debts. For example, if a person has a car note with a $20,000 balance, but the car is only worth $10,000, they can choose whether or not they want to surrender the car to the lender. If they choose to surrender the car, the whole $20,000 car note goes away just like their credit card debts. A variation of the above situation is when your attorney goes to the lender and says "let's make a deal. My client could surrender your $10,000 vehicle and get rid of a $20,000 debt, so how about reducing the $20,000 debt to $12,000 at 0% interest for 5 years?" Can you see the possibilities for a good negotiation with the lender when their bankruptcy claim could go to $0?
When To Contact a Bankruptcy Attorney
If you can answer "Yes" to at least some of the following questions, you may want to consider contacting Houston bankruptcy lawyer O. Miller White:- Do you have $50,000 or more in credit cards or other unsecured debts (i.e. medical bills, signature loans, post repossession, or foreclosure debts)?
- Are you barely making the minimum payments and your average credit card interest rates are in the 15-29% range?
- Are you behind three months or more on your mortgage payments?
- Are you in danger of foreclosure and your mortgage company won't talk to you?
- Are you about to be sued for unpaid debts you cannot afford to pay? Have you already been sued?
- Have you suffered a substantial loss of income, making it unlikely that you'll be able to pay off your non-mortgage debts in the next 5 to 10 years?
If you are considering filing for Chapter 7, Houston bankruptcy lawyer O. Miller White offers a FREE CONSULTATION if you would like to discuss your situation in more detail. We can even help those who live in the Channelview Baytown areas. To schedule your free consultation, please contact the Law Offices of O. Miller White today at (281) 315-8810.
