Tag Archives: chapter 13 bankruptcy

Can I Rehabilitate My Credit Report after Bankruptcy, and How?

Yes, you can rehabilitate your credit report after bankruptcy. Even though the bankruptcy details remain on your credit report for as much as ten years, you can immediately begin to improve your score after filing for bankruptcy. This is quite important considering the fact that credit companies, including car finances and mortgagors, will examine your credit report. Credit reporting companies generally look at your outstanding debt, your payment history, your length of credit history, and also how much new credit you are seeking; all of these are put together to determine your credit score.

 
The American economy in a sense is paradoxical: While one goes into bankruptcy because he or she has defaulted in paying off debts, one of the fastest means of rehabilitating your credit report is to spend even more and establish a better credit history. It is believed that your power to spend more after bankruptcy translates into increase earning power to show you are more credit worthy and responsible.

 
But before applying for new credit cards, try to purchase within your means, paying off your bills in full at the end of every month; the essential thing is to improve your repayment habit. Paying off debts in full when they are due, and making sure your debt is as low as possible when compared to your available credit, will enhance your ability to earn more, and that will put you in a better light when it’s time to borrow money. In other words, always try to spend within your means before you borrow more money. Adopting this approach when you assume more debt will help to rehabilitate credit report as you will make your payments in full and on time; and eventually, if this process is continued and improved upon, your credit report will become much better.

 
Talk to a professional bankruptcy attorney or credit counsel to properly guide you in your quest to rehabilitate and improve on your credit rating. Going into bankruptcy is not an end in itself, but an opportunity to make a fresh start, and will need to make wise financial short and long term decisions.

 
Summary
The blog explains that it is possible to rehabilitate and improve on the credit report. It also highlights the steps necessary to be taken to achieve this over time.

 

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Attorney Eli Tamkin is a Cleveland bankruptcy lawyer.  He has been practicing law since 1989 and in Cleveland Ohio since 1994. Since then, he has dealt with a variety of legal issues, including bankruptcy, real estate, divorce, personal injury, and probate. Many times, answering questions on bankruptcy draws on knowledge of other legal areas as well. His experience in these other areas, as well as in bankruptcy enables him to address your particular needs and to offer you advice that is applicable to your situation.

Can I Keep My Car if I file for Bankruptcy?

The law permits you to keep one vehicle whose value or equity after reducing any lien for financing is equal to $3,675.00 or less. You can determine the general value of your car by Googling NADA or Kelly’s Blue Book and checking it out there. The trustee may valuate your car differently than that amount, but it gives you a general idea as to the value. You should also reduce the value based on the number of miles driven and the condition of your vehicle. The vehicle exemption under Ohio law protects a vehicle with a value up to $3,675.00; you will be able to add onto that another exemption, called, “wild” car of up to $1,225.00.

 
If the equity in your car as discussed above is less than the combined exemptions listed, you will be able to keep your car. But if the equity in your is over that amount, and you still want to keep your car, then you may have to pay to the trustee the difference between the value and your exemptions. So, for example, if after your car is paid off in full from financing, it is worth $6,000.00; and you apply the car exemption of $3,675.00 and the wild card of $1,225.00, the total value of the car that will be protected totals $4,900.00. Subtract that amount from $6,000.00, the Blue Book value of your car. So in order to keep your vehicle, you will have to pay approximately $1,100.00. However, that amount may vary depending on how much the trustee has valuated your car. Usually the trustee allows installment payments to be made. If you do not pay the trustee, the trustee may file a motion in court to sell your car at an auction.

 
On the other hand, if your car is being financed you can also deduct the amount you owe on the note to further reduce the equity of the car. An important point to note is that you are behind in your car payments, a Chapter 7 Bankruptcy will only stall the collection proceedings temporarily, and the finance company may file a motion to repossess your car. Unless you get current on your payments before you file, the financing company may eventually repossess your vehicle, unless your Attorney works out a payment arrangement. A Chapter 13 bankruptcy on the other hand is designed to allow you to pay off the prearrange over a period of time, usually 3-5 years; in that case you would get long term relief for your car payments with a Chapter 13.

 
To get a better handle on what you are entitled to with respect of Ohio law and the total motor vehicle exemption ceiling, talk to an attorney proficient in bankruptcy laws and processes; this would give you a clear idea of what the status of your car before you file for bankruptcy.

 
Summary
The blog explains when the trustee can “take” your car and how you can avoid that. It avers that it depends on the condition of your vehicle at the time you file the bankruptcy and the exemptions that come into play to protect that value.

 

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Attorney Eli Tamkin is a Cleveland bankruptcy lawyer.  He has been practicing law since 1989 and in Cleveland Ohio since 1994. Since then, he has dealt with a variety of legal issues, including bankruptcy, real estate, divorce, personal injury, and probate. Many times, answering questions on bankruptcy draws on knowledge of other legal areas as well. His experience in these other areas, as well as in bankruptcy enables him to address your particular needs and to offer you advice that is applicable to your situation.

Can I File a Bankruptcy and also Save My Home From Foreclosure?

Yes, you can file a bankruptcy and then afterwards try to mediate your mortgage note.

When you file a Bankruptcy,  all of your creditors must stop all collection activities, including the bank. This means that if there is a foreclosure against you that must stop, and your lawyer should tell the court about it. The bank will need permission from the bankruptcy court to foreclose on your home.

After the bank receives that permission and files a complaint, you can then request mediation from the court. However,  getting the Court to approve your request to mediate is only the first step; after that you must now get the bank to agree to modify your mortgage note.

Summary

The bank must ask the Bankruptcy Court for permission to file a foreclosure complaint against you. After you have been served with a complaint, you can then request the court to mediate.

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Attorney Eli Tamkin is a Cleveland bankruptcy lawyer.  He has been practicing law since 1989 and in Cleveland Ohio since 1994. Since then, he has dealt with a variety of legal issues, including bankruptcy, real estate, divorce, personal injury, and probate. Many times, answering questions on bankruptcy draws on knowledge of other legal areas as well. His experience in these other areas, as well as in bankruptcy enables him to address your particular needs and to offer you advice that is applicable to your situation.

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