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Credit Reports and Affordable Bankruptcy Options FAQs

Credit Reports and Affordable Bankruptcy Options FAQs

By Ginger B. Kelly, Esq., April 3, 2019

I often get questions from my clients regarding how long a bankruptcy and debt will remain on their credit reports, after declaring or filing bankruptcy.  Here are a few of those frequently asked questions (FAQs) regarding credit reporting and how to pay for a lawyer to help with filing bankruptcy:

My bankruptcy was discharged about 10 years ago. What do I have to do to have it removed from my credit report?

~James, from Dudley

Dear James,

Since your bankruptcy and other accounts included within your bankruptcy will be deleted automatically, you don’t have to do anything to have them removed.

Although the date your discharge was recorded is the date your bankruptcy plan was completed, this date has nothing to do with when the information will be deleted. It is very possible that the information about your bankruptcy has been already deleted from your credit report.

How Long Does Bankruptcy Stay on the Credit Report?

~Dave, from Charlton

Dear Dave,

The date your bankruptcy will be deleted from your credit report is not set in stone.  Credit Bureaus will delete this public information anywhere from 7 to 10 years from the date you filed your bankruptcy.  The reason why this is not set in stone is because this depends upon the type of bankruptcy, or Chapter, you filed under.

A Chapter 13 bankruptcy is deleted 7 years from the date of filing because you are paying your creditors with a payment plan.  A Chapter 7 bankruptcy is deleted within 10 years from the date of filing because most, if not all, of your creditors will go without any payment.

When will accounts included in my bankruptcy be deleted from my credit report?

~Chrystal, from Southbridge

Dear Chrystal,

In both Chapters 7 and 13, individual accounts can remain on your credit report for seven years.  Typically, a person who files for bankruptcy is having serious difficulty payment all their debts.  Past due debts go into delinquency status. Delinquent debts, included in the bankruptcy will be deleted 7 years from the original delinquency date.  The original delinquency date is the date the account was late, which is typically 30 days past the due date.

Just because you declared bankruptcy, your original delinquency date is not altered.  This means that the time the account remains on your credit report is not extended, simply because you declared bankruptcy.

I need to file Chapter 7, but I don’t have any money to pay the legal fees, what can I do?

~Jen, from Webster

Dear Jen,

I totally understand your situation.  It seems crazy to have to pay a lawyer to file for bankruptcy when you can’t even pay your bills.  Isn’t that the reason why you need to file in the first place?

First and probably foremost, if you are really really poor and meet certain income guidelines, you may qualify for a reduced fee or legal aid.  I will point you in the right direction with this. I also offer reduced fees for certain individuals in dire situations.

Another suggestion is to apply your income tax refund to pay for your bankruptcy, rather than your back bills and old debt.  But be sure to contact your trusted bankruptcy attorney, first, before you decided to not pay debt or overdue bills.

Lastly, I can’t tell you how many people get help from family and friends the second they explain they are doing something helpful, like bankruptcy, to get a fresh start.

Other than these suggestions, we can discuss other options for payment at our first consultation.  If you can pay a little along into a payment plan until you have all of your fees paid, this may work for you.  Ask me how I can help you tailor a program that fits your needs and we can discuss any sensible option.  At our first consultation we will sit in my very quiet and completely confidential office and sip coffee if you like, and talk about all of your options and questions.

Thanks for your questions, James, Dave, Chrystal and Jen.  I’m always happy to help.

If you have legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland.  We can explore whether or not bankruptcy is the easy way out for you.  Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit our website, or call us at (508) 784-1444.

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NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2019 by Ginger B. Kelly, Esq., all rights reserved

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Filed under Bankruptcy, Chapter 7, Collection, credit card debt, Debt, Debt Collection, Deficiency, Deficiency Debt, Empowerment, Filing, Financial, Hiring Counsel, Massachusetts, payment, Rhode Island, tax refund, tax return

Utility Shut-off Solutions

Attorney Ginger B. Kelly

Good advice from Attorney Ginger Kelly, licensed since 2004

Utility Shut-Off Solutions

by Ginger B. Kelly, Esq., January 11, 2019

I’ts that time of year, again.  The time when utility costs sky-rocket into the netherworld of bills you wish you could pay, but can’t.  But wait, don’t be too hard on yourself.  There are a few solutions to help you navigate this rocky road of uncontrollable utility bills.

Mass.gov has multiple solutions for certain people.  For example, if you live in Massachusetts, and if all the people residing in your home are age 65 and over, your electricity or gas cannot be shut off without permission from the Department of Public Utilities (DPU).  If you are experiencing financial hardship and one of the following applies, your electric or gas cannot be shut off without permission from the DPU:

  • You, or someone in your home, is seriously ill;
  • You have an infant under 12 months in your home;
  • All adults in the home are age 65 or older and a minor child resides in the home;
  • It is between November 15 and March 15 and the utility service is needed to heat your home.

If you meet these requirements and your electric or gas has been shut off, you should call your utility company directly. They will ask for proof of your situation, such as a child’s birth certificate, doctor’s note for a serious illness, or income-based proof of your inability to pay. 

If, after speaking with your utility company, your electric or gas service is not restored, you should contact the Department of Public Utilities at (617) 737-2836 or 1-877-886-5066 (toll-free) or complete their online complaint form.

If your water is provided by the city or town where you live, you need to contact the city or town directly to have your service restored. The Department of Public Utilities has a list of all the water district areas in Massachusetts.

If your water is provided by a company, your water cannot be shut off if one of the following applies:

  • Everyone in your household is age 65 or over;
  • You, or someone in your home, is seriously ill;
  • You have an infant under 12 months in your home;
  • All adults in your home are age 65 or older and a minor child resides in your home;
  • You are a tenant whose landlord is responsible for the water bill.

If, after speaking with your utility company, your water is not restored, you should contact the Department of Public Utilities at (617) 737-2836 or 1-877-886-5066 (toll-free) or complete their online complaint form.

Oil, Propane and Wood (Un-Regulated Utilities)

There are no specific legal protections for utility customers who heat with oil, propane, or wood. However, providers of these utilities are often willing to work with consumers who find themselves in difficult situations. You should contact your service provider directly and if you cannot get your utility restored, you should file a complaint with CARD.

How can I get help making my payments?

You may seek help from your local fuel assistance office if you are having trouble paying your utility bills. You do not have to be unemployed to get help. In addition, utility companies are often willing to work out discount, budget, and payment plans. You can learn about your fuel assistance options here.

How can I find out about my other options?

If you are facing a utility shut-off, including your electricity, gas, water, or telephone due to unpaid bills, filing Chapter 7 bankruptcy may help keep your service connected. Under federal law, if you file for bankruptcy, the utility company cannot change, refuse, or disconnect your service.  Contact an experienced bankruptcy attorney to find out your options.

If you are poor and meet certain income guidelines, you may qualify for legal aid.  Another suggestion is not to use your income tax return refund check to pay for your back bills, but use it to pay for your bankruptcy and be free from most all of your crushing debt and back utility bills.

At our office, there are a number of ways to pay for your bankruptcy, including using your federal and/or state income tax return refunds.

If you have other legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland.  We can explore whether or not bankruptcy is the easy way out for you.  Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

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ABOUT ME: Attorney Kelly is an attorney in good standing, licensed to practice in both the Federal District and State Courts of Massachusetts and Rhode Island. Her law practice is focused on consumer debt, finance, bankruptcy and District Court matters. Attorney Kelly is experienced in both criminal and civil trial work. On a personal note, Attorney Kelly enjoys writing and other things, like conservation and agriculture. To find out more, visit our website, or call us at (508) 784-1444.

~~~~~~~~~~~~

NOTICE: This is an Advertisement. This post is not legal advice. Consult your attorney. Attorney Kelly does NOT provide legal advice to anyone via social media or anywhere over the Internet. Any and all electronic posts and writings, by Attorney Kelly, does NOT establish any type of attorney-client relationship, whatsoever, neither perceived, actual, material, implied or other. We cannot stress enough, if you need personal legal advice, always see your attorney. Do not rely upon Attorney Kelly’s posts, writings or any Internet information on websites or social media for your own personal legal advice. Seek legal advice and representation from your own personal attorney.

Copyright © 2018 by Ginger B. Kelly, Esq., all rights reserved

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Filed under Bankruptcy, Chapter 7, Collection, credit card debt, Debt, Debt Collection, Empowerment, Filing, Financial, Financial Planning, Legal, Legal Rights, Massachusetts, Massachusetts law, Massachusetts town ordinance law, payment, practical stuff, Uncategorized, Utility Bills, Utility Shut-Off

Top 4 Reasons NOT to Consider Bankruptcy

 

Top 4 Reasons NOT to Consider Bankruptcy

By Attorney Ginger Kelly, December 24, 2018

It’s not unusual to borrow money and have every intention of paying it back. But for some unknown reason, you can’t pay it back. Maybe you lost your job or your hours got cut. Did your small business just crash or were sick or hospitalized. Sometimes you need to stay home with a sick child or elderly parent. Whatever the reason, it’s very human to find yourself unable to pay back loans and credit cards. When life happens, and you are stuck with debt you can’t pay, it’s OK to talk to an experienced bankruptcy attorney.

Although many people avoid the “B” word, bankruptcy, bankruptcy could be the tool you need to get back on your feet. If you can’t decide what to do, here are the top 4 reasons why you should not consider bankruptcy.

Number #1. The Hole you’ve Dug for Yourself isn’t too Deep to Get Out

Paying and paying on credit card debt without making a dent in the balances is a perfect storm for credit disaster. Another problem is paying a minimum payment on a judgment for years and years and years and the balance just doesn’t go down, it appears to go up. These are problems that may lead you to think bankruptcy is the best option. But what if you are simply annoyed at paying bills? The best plan of action to take is to do the math. Weigh your disposable income and your unsecured debt. Are you making more than your minimum payments? Are you making any progress paying down principal? Even if you can only see a slight dent in the principal, over time, but it’s taking a long time for you, evaluate whether bankruptcy is really the best idea for you right now. If you have no employment or medical issues, no change in family status, keep plugging along. Bankruptcy is probably not for you.
Dennis, a Veteran living by himself on Social Security and a small pension had problems with a judgment on a small debt. Because Dennis did not defend himself in court, so the creditor obtained a judgment against him. This was way back in the 90’s. Dennis had no choice. He started making very small minimum payments of about $30 per month out of his disposable income, which wasn’t much. In 2017, he came to me for help. Dennis paid almost $9,000 to his creditor over the years and he couldn’t see any end in sight. Since Dennis had little monthly disposable income and other medical debt, bankruptcy was a good fit for Dennis.

Tip #1: If you can’t afford to pay all your unsecured creditors in full, over the next 3 years, your current strategy isn’t working.

Number #2: You Have NOT Looted Your Retirement Account to Pay Bills

It can be very tempting to take a loan or an early withdrawal from your retirement funds, simply to keep your head above water. But if you have the means not to do this and to seek help first, even when debtors are filing law suits against you, awesome! Borrowing money against your retirement account is a very big risk, especially if you are close to retirement age. By looting your retirement, you are not getting out of debt easily. You are actually taking from old-age self and using it, hoping you will recover. Most people don’t recover. And don’t forget the consequences of early withdrawals. It’s not worth it. Alternatively, consider making plans to contact a bankruptcy attorney who can help you move forward, not backward, before you decide to loot your retirement accounts.
Steve is currently being sued by a lender for a repossessed vehicle because he suffered road bumps in his career. After several layoffs, he decided he could no longer afford his $400 a month car payment. He surrendered his car. After the lender sold his car at auction, Steve still owes about $10,000. If Steve borrows from his retirement account he can pay off this debt and not have to worry about the law suit. Sounds tempting, doesn’t it?

Steve decides to hire a lawyer and the lawyer negotiates with the lender for a payment plan. He sticks to his monthly payments and pays off this debt within 3 years. Steve still has enough money to save for retirement, repair his current vehicle, eat out every once in a while and pay his mortgage. Steve probably doesn’t need to file for bankruptcy.

Tip: Seniors who need the relief bankruptcy are often tempted to use precious retirement funds to pay off credit card debt. If you find yourself in this situation, consider this a big red flag.

Number #3: Your Family Isn’t Going to Suffer

It’s a known fact that having a child is not easy. Some say that having a child is the single greatest predictor that a single person will end up in financial collapse. When struggling with debt and weighing your options, consider who is dependent upon you. What are their ages? Do you have an “emergency fund” to care for them if something unexpected happens? The larger the number of dependents you have, the more likely you are to need an emergency fund and health insurance.

Karen got slammed with a judgment from one of her credit card creditors. It was from a debt she acquired back in 2006. She was very upset. Karen is a single working mom, supporting two school-aged kids. Their father pays hardly any child support. If Karen’s creditor garnished her wages, or she lost her job, how would she pay her rent, feed her children and buy gas to get to work? With this in mind, Karen worked out a payment plan with her creditor and is now making minimum payments. Karen is also saving for emergencies and has enough disposable income to pay for things like school pictures and activities, clothes, food and gas. If this wasn’t the case, Karen would probably benefit greatly by talking to an experienced bankruptcy attorney. But since her family is doing fine, and she’s paying her unsecured debt and her bills, bankruptcy may not be a good option just yet.

Tip: If you have dependents, be sure to stash some cash into an emergency fund.

Number # 4 You’ve Got Equity on Your Home AND you can Catch up on your Past Due Mortgage Arrears

It’s been estimated the over 7 million Americans are underwater on their mortgages. But there are many ways of finding relief, like negotiating a loan modification and talking to your lender. If you file for bankruptcy these are the 5 things you may be able to do, as a last resort of course.
1. Catch up on past due mortgage payments or negotiate a loan modification so you can stay in your home;
2. Eliminate a second mortgage or home equity loan through bankruptcy;
3. Erase debt that could be due if the lender foreclosed and sold your home for less than you owed;
4. Free up money that you were paying on other debts so you can afford your home loan; and/or
5. Avoid a big tax bill from “cancellation of debt income” that could happen if your home goes into foreclosure or if you negotiate a short sale.

Where to Get Help

A consumer bankruptcy attorney can help you understand how filing may help you. Many offer low-cost or free consultations. Every bankruptcy attorney should tell you of your options and alternatives to bankruptcy before you make those very important decisions.
If you have other legal questions, especially if you are contemplating bankruptcy or dealing with collections or debt collection law suits, Attorney Ginger Kelly is now accepting clients in the Dudley, Webster, Sturbridge, Fiskdale, Southbridge, Saundersdale, Oxford, North Oxford, Charlton, Charlton Depot, Auburn, Leicester, Rochdale, Spencer, Brookfield, East Brookfield, West Brookfield, North Brookfield, Warren, Brimfield, Wales, Palmer and Holland. We can explore whether or not bankruptcy is the easy way out for you. Our office is a quiet and comfortable place to talk, and a free pot of coffee will be waiting for you when you arrive.

The Law Offices of Ginger B. Kelly

167 Carpenter Hill Road

Charlton, MA 01507

(508) 784-1444

AttorneyGingerKelly@gmail.com

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