Bryn Mawr Bankruptcy Lawyer
Bankruptcy is not something to be feared by debtors in Bryn Mawr. To ensure that bankruptcy is successful for you, there are a few things you should do before filing a bankruptcy petition.
Before you file a petition for bankruptcy in Bryn Mawr, carefully assess your debts so that you have a full understanding of your financial situation. Then, identify the bankruptcy chapter you can file based on your income and expenses. It is important for debtors to prepare for the impact bankruptcy may have on their credit and make a plan for a successful path forward. This will include deciding how to best build your credit back up again. If you are married, becoming an authorized user of your spouse’s credit card can help. Make a conscious effort to save smartly so that you do not find yourself in a difficult financial situation in the near future.
To have Young, Marr, Mallis & Associates evaluate your case for free, call our Bryn Mawr bankruptcy lawyers now at (215) 701-6519.
Steps to Take Before Entering Bankruptcy in Bryn Mawr
Before you enter bankruptcy in Bryn Mawr, you should do a couple of things. Start by assessing your debt. Is some of your debt dischargeable? Can you repay some of it before bankruptcy? Then, identify the chapter of bankruptcy that suits your situation. The chapter of bankruptcy you file will be determined according to your income.
Assess Your Debt
When our bankruptcy lawyers take on your case, we will begin by doing a complete overhaul of your debt and finances. This will allow us to get a clearer picture of your financial situation and what is necessary to address it. During this assessment, we can identify dischargeable debts from non-dischargeable debts. Dischargeable debts, such as credit card debt, are effectively erased during bankruptcy. If the majority of your financial distress is due to dischargeable debts, bankruptcy can eliminate those stressors. We will largely focus on addressing your non-dischargeable debts, which must be repaid in bankruptcy.
If you can pay off some of your debt before bankruptcy, do so. This might make it easier to pay off your creditors during bankruptcy. It can also make it so you do not have to liquidate certain assets if you file Chapter 7 in Bryn Mawr.
Identify Your Chapter
Then, identify the chapter of bankruptcy you will file. To do this, you must go through a means test. This will involve an assessment of your income and expenses. You will have to go with Chapter 13 if you earn too much income. If you earn too little, Chapter 7 will be best for you. Chapter 13 bankruptcies involve repayment plans. These plans allow debtors to consolidate their debts and work towards repaying them through more affordable monthly payments. Repayment plans set debtors on a path toward settling their debts but in a more accessible and less stressful way.
If Chapter 7 is the type of bankruptcy you file, identify the liquidation exemptions you want to use. Applying exemptions to your case can prevent you from losing specific assets or property during bankruptcy. Pennsylvania allows debtors to choose state or federal exemptions. Generally, federal liquidation exemptions are more expansive and allow debtors to exclude more important assets from liquidation in Bryn Mawr.
What to Do After Bankruptcy in Bryn Mawr
By declaring bankruptcy, you make it clear that you need help handling your financial situation. This can impact your credit score. While that can seem daunting to debtors, it may be preferable to living with suffocating debt in Bryn Mawr.
Prepare for the Impact to Credit
The impact on one’s credit score following bankruptcy will depend on how high their credit was prior to bankruptcy. While bankruptcy will cause your credit score to drop, ignoring your debt might have more drastic effects. Chapter 7 bankruptcy can stay on a person’s credit report for ten years, while Chapter 13 bankruptcy usually stays on credit reports for about seven years.
If you are married and do not have to file jointly, consider the benefits of filing individually. This will allow your spouse’s credit report to remain unaffected by your choice to file for bankruptcy. So, your spouse will still be able to make large purchases in the near future following the discharge of your bankruptcy case in Bryn Mawr.
Build Back Up Your Credit
The effects of bankruptcy on one’s credit score are not permanent. By changing your spending habits and lifestyle, you can build back up your credit steadily over time. Make small purchases on your credit card that are easily repayable. Instead of only making your minimum monthly payments on time each month, pay off the full monthly balance of your credit card if possible. If you have a spouse whose credit was unaffected by your decision to file for bankruptcy, you can become an authorized user of their credit card. To do this, you do not have to get approved for a credit card yourself. This can allow you to build back up your credit. Within several months of your bankruptcy being discharged in Bryn Mawr, you can start seeing improvements to your credit score.
Debtors should start practicing smart saving following bankruptcy to prevent a similar situation from happening again. While this looks different for everyone depending on the size of their household, income, and expenses, having savings can allow you to repay debts more easily in the future should you find yourself in debt. Put a portion of your income into a savings account periodically, and do not use that account for any unnecessary purchases. View it as an emergency fund and only use it if you are at risk of getting into debt again.
Contact our Bryn Mawr Lawyers About Your Bankruptcy Case
The Bryn Mawr bankruptcy lawyers at Young, Marr, Mallis & Associates can review your case for free when you call us at (215) 701-6519.