The point of filing for bankruptcy is to eliminate debts and free up disposable income. However, there will be some debts that remain due after your case ends, and it is important to know how those debts will be treated so you can act accordingly. The most common debts still due after bankruptcy include car and house payments. This is because most people need to keep their car in order to get to and from work, so the bills can be paid, and everyone needs a place to live so hanging on to your house in bankruptcy is popular.
If you have made the decision to file for bankruptcy and are wondering what your financial picture will look like after the case is over, consider the following:
- Any debt you reaffirm, which means you agree to remain personally responsible for the debt after the bankruptcy case is final, will have to be paid. If you do not continue making the payments, the lender can and probably will sue you. What this means is that once a judgment is entered, the creditor can undertake collection efforts.
- Debts still owed after bankruptcy not only need to still be paid, but they are also debts for which you can negotiate with your lender on payment and other terms. If a debt is still owed, you have certain rights. This is especially true if you signed a reaffirmation agreement, which gives the lender the ability to discuss the debt with you after the bankruptcy case is over. If you find yourself having a hard time making the payments pursuant to the reaffirmation agreement, you can call the lender and ask for payment options. This is not something you can do if you decide to voluntarily pay for your property after bankruptcy without also reaffirming the debt.
This information is complex, and can be difficult to understand. We can help make it clear, so you are clear about what is expected of you once your case is final. It is much easier to stick to a financial plan when you understand the terms of that plan. Call our office today to learn more and allow us to help you formulate a plan that makes sense.
For more information about debt management, bankruptcy, and what you will still be required to pay after filing for bankruptcy, contact us at www.DsouzaLegalGroup.com. We help by explaining your options and developing a plan that meets your needs.