Recent Blog Posts
What Is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?
There are many ways a person can build up debt that he is unable to repay. An individual may accumulate multiple high-balance debts, such as a mortgage, auto loans, medical bills, or credit cards. Whether it is due to poor luck or decisions that did not work out as planned, when a person gets in over his head, he has the option to file for bankruptcy.
Bankruptcy allows a person to have a second chance if he no longer has the resources to repay his debts. While there are benefits to bankruptcy, such as the forgiveness of some debts, it will negatively affect a person’s credit score and his ability to borrow money in the future.
There are two common types of bankruptcy available to individuals, and each one has different requirements and regulations:
- Chapter 7 Bankruptcy: This method of bankruptcy will discharge most outstanding debts. Some debts, such as student loans or obligations to pay child support or spousal maintenance, cannot be discharged. When filing for Chapter 7, a person’s non-exempt assets will be liquidated by the bankruptcy trustee to pay off some of his debts. Some examples of assets which are exempt are tax-exempt retirement accounts, necessary clothing, educational texts, and prescribed health aids. In some cases, a filer may be able to maintain ownership of a home and/or a car that is below a certain value. This method provides a clean slate and fresh start by eliminating most debts.
Divorce and Finances: What to Expect
Marriage and divorce are alike in that they usher in a number of changes for both spouses, many of which involve finances. Though marriage tends to offer more optimistic benefits, especially in regard to taxes and living with two incomes, the financial challenges of divorce can be more disconcerting.
Regardless of whether the marriage was young or old, you should plan your finances carefully before filing. Your budget should include legal expenses, possible relocation, and any adjustments that come with living on a single income. Spouses with children may face other monetary hurdles.
Seeking Out Professional Advice
Financial challenges should not dissuade you from consulting an attorney. A divorce lawyer may be able to help you avoid mistakes that could compromise your financial well being. According to the Women's Institute for Financial Education, failing to seek professional input is one of the most common mistakes divorcing spouses make.
Am I Eligible for a Loan Modification in Illinois?
You may take out loans to purchase various items throughout your lifetime, such as a car, a house, or to pay for your child’s college tuition. A loan modification involves modifying the terms of an existing loan, typically to make it more affordable for you as a borrower who might be in danger of defaulting, sometimes due to a scheduled rate increase or a job loss. For instance, you might want to pursue this route to avoid foreclosure on your house. It is important to note that a loan modification is not the same as refinancing a mortgage. In certain situations, you may also be allowed to file for bankruptcy. By combining these efforts, or by simply electing one of these options, you may be able to keep your home by lowering mortgage payments, avoiding default, and obtaining a way out of debilitating debt. A skilled lawyer can help ensure you take the correct legal steps to secure a promising financial future.
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