The standard that used to define a good credit score is using 30% or less of one’s credit card limit at any one time. In Texas, 30.2% of adults are using 75% or more of their limit. That percentage makes the state the sixth highest in the country.
If you are using too much — or all — of your approved credit, you are obviously not alone. Like thousands of other people, your physical and mental health, personal relationships, and overall well-being may be paying a heavy price as you continue to fall deeper into debt.
Chapter 7 bankruptcy may provide the solution that you need to create a fresh financial start. In fact, more than 15,000 Texas residents filed for Chapter 7 bankruptcy in 2020. Filing for Chapter 7 bankruptcy can offer a path toward financial security so that you can return to making sound financial decisions for your future such as building your retirement or savings.
For more than 40 years I have been helping clients in Amarillo and throughout the Texas panhandle navigate their way out of debt using Chapter 7 bankruptcy. If you believe chapter 7 may be the best way for you to escape the mire of debt and start moving forward again, reach out today to learn more.
Chapter 7 bankruptcy can discharge your unsecured debt, with the exception of unpaid child support, tax debt, and student loan debt. The Chapter 7 legal process takes an average of four months to complete and will discharge your unsecured debt, including but not limited to credit cards, personal loans, and medical bills.
It can also discharge balances due on your business loans, auto loans, and mortgage, although you may have to surrender your business, vehicles, and real property to do so. You are able to keep your home and your car by choosing not to discharge those debts. Filing for chapter 7 will also put an end to any collection calls you have been receiving and may help you restore utility services that may have been shut off.
Chapter 7 will not relieve debt from obligations such as alimony, child support, student loans, back taxes, court fees and penalties, homeowner association fees, and judgments against you for certain personal injury claims. It also will not take care of any unsecured debt you failed to list for discharge in your bankruptcy case.
If your median income is below the Texas average, you can file for Chapter 7 bankruptcy. Currently, that is a monthly income of $4,412.75 and an annual income of $52,953 for a household of one. The annual income amount increases with each member of the household, for example, the median income level for a household of 4 is $88,190.00.
If your household income is above the state median, you are required to pass a “means test” which supplements the calculation by including allowable expenses based on the county in which you reside. These allowable expenses can be deducted from your income to see if you can then meet the median income requirement. The means test may help those with expensive mortgages, for example, qualify for Chapter 7 bankruptcy.
There are many signs that could indicate it is time to file for chapter 7 bankruptcy. Some of the most common signs include any of the following:
You have spent your savings.
You have little or no disposable income.
You’re using loans to pay your bills and credit cards to buy groceries.
Your business vendors require cash on delivery.
You make a credit card payment then immediately max it out again.
You’ve fallen behind on your mortgage or rent.
Creditors are calling about late or missed payments.
Your debts are more than one-half of your annual income.
Paying off your debt would take more than five years, even with extreme measures.
Financial stress is taking a toll on your health, relationships, and ability to sleep.
If any of the items on this list are happening to you, there are steps that you can take to put your financial affairs right again.
At the end of the day, no one wants to live under a mountain of debt. With Chapter 7 bankruptcy, your debts can be discharged, allowing you a start fresh with a clean financial slate. Filing for Chapter 7 bankruptcy can be complicated and may seem overwhelming, but you don’t have to face this challenge alone.
If you are considering filing for chapter 7 bankruptcy, reach out to me today to schedule a consultation. Together we can review the details of your situation, explore all of your options, and walk through the bankruptcy process step by step. Chapter 7 may offer you the opportunity to finally get out from underneath your debt. Don’t wait. Call me today to learn more about how chapter 7 bankruptcy might be the right option for you.
At Swindell Law Firm, I have worked with hundreds of clients looking for a fresh start through Chapter 7 bankruptcy. If you live in Amarillo, Borger, Pampa, Hereford, or Dumas, Texas, or anywhere in the panhandle, let me help you find the financial relief you need. Call my office today to schedule a consultation. Getting out of debt is nothing to be ashamed of, and chapter 7 bankruptcy can be an extremely helpful tool to help you get back on solid financial ground. Call or reach out to my office today to learn more!