BankruptcyLawStl: December 2012

Tuesday, December 25, 2012

St. Louis Bankruptcy Attorney Insight: Credit Card Debt

By Frank Ledbetter

St. Louis Bankruptcy Attorney - St. Louis, MO

Any time people become unable to pay their minimum monthly credit card payments on time, they may be influenced to use one credit card to help make payments on a different credit card in a frantic attempt to keep current on their charges. Sadly, paying credit cards using other credit cards may result in very quickly escalating debt.

I’m usually surprised at the large quantity of credit lines people can obtain on their credit cards.

Usually when folks “max out” their credit cards they will have gotten themselves into an unsustainable debt situation where sometimes making the minimum monthly payments will leave them without the funds to pay for food, rent and additional necessities. When this occurs, individual bankruptcy could be the most suitable choice.

Most folks desire to pay their creditors entirely and on time, however I’ve noticed too many folks that get in above their heads by taking on just as much financial debt as the credit card issuers can give them. I’ve realized that the credit card issuers frequently give folks a lot more credit than they will be able to handle.

Credit card debt will rarely go away by itself. Even when a credit card provider writes off charges on an account, they'll most likely sell it off to another company who will then possess the right to collect on the balance.

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Thursday, December 20, 2012

St. Louis Bankruptcy Attorney Insight: Debt Relief Options

By Frank Ledbetter

St. Louis Bankruptcy Attorney - St. Louis, MO

If you’re struggling with debts, you want to be very careful before you sell or give away things you own before consulting with a bankruptcy attorney, particularly if you transfer those things for less than fair market value.

If you file Chapter 7 bankruptcy or Chapter 13 bankruptcy, you will need to disclose on your bankruptcy documents any things you owned which you sold or gave away during the two years prior to the filing of your case.

Further, in Missouri, if the sale or gift of the asset was within the last four years, the bankruptcy trustee may be able to void the transfer if it appears that the sale or gift was done to shield the asset from creditors.

If someone files bankruptcy in Missouri within four years of selling or giving away an asset, that asset may be subject to being recovered by the bankruptcy trustee and sold with the proceeds to be paid to the client’s creditors.

Sometimes, people get the notion that they may transfer an asset which might have more equity than the client would be allowed to have in the asset. For example, they may think they may transfer a car with over $3,000 in equity to a friend or relative and that way prevent the trustee’s liquidation of the asset.

However, such a transfer would likely not allow the protection of the asset if done within the four years prior to the filing of bankruptcy.

Selling assets for fair market value may be permissible shortly before filing a bankruptcy in order to obtain money to pay living expenses, but it is always advisable to consult with a bankruptcy attorney before selling or giving away assets if the person might need to file bankruptcy.