If you have credit card debt that you cannot afford to pay or have even reached the point where the credit card company has sued you and obtained a judgment against you, you may not know where to turn. But one option you should at least consider is declaring bankruptcy.
Bankruptcy is a powerful tool that exists to help individuals with more debt than they can afford to pay. Even if a credit card company has obtained a judgment against you, a bankruptcy can eliminate that judgment and give you a fresh start, so long as the debt was not created under fraudulent circumstances. For example, if you decide that you are going to declare bankruptcy, but before you do, you make additional charges on your credit card (thinking that the bankruptcy will simply make these charges go away), the creditor can file an action to request that the debt not be discharged.
It is important to point out that there is a difference between a judgment and a lien. A judgment results from a ruling by a court in favor of your creditor, which states that you must pay the specified amount of money. A lien is when a creditor that has obtained a judgment against you then has that judgment attached to your assets, such as real estate. If you sell the asset, any proceeds from the sale will have to go toward payment of the lien.
As noted above, a judgment from a credit card company can be eliminated as a part of a bankruptcy. But a bankruptcy may not be able to eliminate a lien depending on the timing, circumstances, and location under which the lien was filed. Therefore, it is generally a good idea to have the specifics related to any judgments or liens reviewed by a bankruptcy attorney before making a decision.
Declaring bankruptcy is not an option you should consider lightly, as it can have significant long-term consequences. These consequences can include having the bankruptcy reflected on your credit report, impacting your ability to obtain some jobs, increasing the difficulty and cost of future loans you are able to obtain, and forcing you to sell assets you would otherwise prefer to keep. But if you already have a judgment against you for credit card debt, declaring bankruptcy may still be the best option.
How can I obtain help from a bankruptcy attorney related to a credit card judgment?
If you complete the short form below, a bankruptcy attorney can review your specific situation to give you further advice. A lawyer who is trained in bankruptcy proceedings and who has worked with other clients with situations similar or identical to yours will have the necessary experience to evaluate what next steps are best for you.
As a bankruptcy may have repercussions that last for many years, consider all available options before entering into bankruptcy proceedings.
Latest posts by Beth (see all)
- Chapter 7 bankruptcy and why it could be a mistake - April 30, 2017
- Chapter 11 bankruptcy What do I need to know? - April 24, 2017
- Chapter 13 what if I cannot make my debt payments? - April 19, 2017