Articles Posted in Chapter 7 Bankruptcy

You can bounce back from bankruptcy way more quickly than you think.  For instance, debtors who file bankruptcy can qualify for an FHA loan in as few as two years, or a conventional loan four years after filing.

What about credit scores?  They can and frequently do go up right after filing.

Bankruptcy can help repair credit faster than trying to chip away at debt with predatory interest rates or judgments that last for 20 years.  Most people that we talk with, if they decide to file, they usually wished they’d pulled the trigger and gotten that “fresh start” years before.

Credit reporting is changing for medical debt.  Starting July 1, 2022, previously defaulted, but subsequently repaid, medical debt will no longer be reported on someone’s credit.  Next year, medical debt of less than $500 will not be reported on credit reports any longer.  This doesn’t mean that the medical provider doesn’t have a claim however.  It’s important to keep copies of these small medical bills and give them to your bankruptcy attorney so they can be officially discharged in your bankruptcy.

The timing can also be important.  Remember, that you can only file a Chapter 7 every eight years.  So if you have a medical procedure coming up that may have unexpected and you incur out-of-pocket costs, you may want to consider getting ready to file bankruptcy, but wait to actually file once you are medically cleared.

It’s often better to file a bankruptcy when you are unemployed.  You don’t have to be without a job, but we’d rather you look into filing bankruptcy right after a medical procedure (so all out-of-pocket costs are discharged), but before you begin a new job.